Online Reporter
Business Reporter
ZIMBABWE’S property investment landscape remains on a strong growth trajectory, the latest development being the launch of the Seatrite Five Trust, a real estate investment trust (REIT) managed by Nhoro Asset Management.
The trust is raising funds for the development of a 148-apartment hotel in Borrowdale, Harare, to be operated under the Radisson Hotels brand, marking the group’s first entry into Zimbabwe.
The trust said: “We are selling units in a trust, Seatrite Five Trust, that is a real estate investment trust to be listed separately on the VFX (Victoria Falls Exchange) as a REIT.
“Through this vehicle, investors will gain exposure to and ownership of an apartment hotel operated by one of the largest hotel groups in the world, Radisson.”
The Seatrite REIT is offering 27 144 units, with the proceeds from their sale earmarked for the construction of the Radisson Apartment Hotel Harare (Block 5).
Construction is scheduled for completion by May 2027, with operations set to commence immediately thereafter.
“The unit cost of Seatrite Five Trust on launch will be US$500 per unit and we are offering 27 144 units,” the trust explained. “The project will be revalued quarterly to estimated market value of the completed building, and the unit selling price adjusted accordingly.
“This adds an advantage of capital appreciation for early investors.”
The purchase price of the building by the trust is pegged at US$13,5 million, translating to around US$91 000 per furnished apartment, a figure the trust describes as an extremely attractive price.
The property itself will sit on a 7 794m² stand in Borrowdale, with a total built-up area of 9 860m².
The apartment mix comprises 136 studio units, 11 one-bedroom units and a single three-bedroom apartment.
All units will be furnished to Radisson’s international standards.
The operator will be Radisson Hotels, one of the world’s largest hotel groups, ensuring global brand recognition and access to international booking networks.
“The apartment hotel will be operated by the Radisson Group, a well-known international brand, as its first entry into Zimbabwe,” the trust noted.
The facility is designed with sustainability in mind. The trust stated that the development will be self-sufficient in water and electricity, keeping with their sustainable future mantra.
The trust is projecting attractive returns for investors.
Based on Radisson’s profit and loss forecasts, annual income yields are expected to grow steadily from 7,5 percent in year one to 14 percent by year 10.
“Occupancy dependent, we could see returns of beyond 16 percent, unrivalled in the market by dividends from property companies and comparative REITs,” the trust said.
“We will, however, guarantee a first-year yield through a trust reserve fund at 8 percent.”
One of the key rationales for floating Block 5 as a trust is to broaden market access.
“We floated Block 5 as a trust to open our products to another part of the Zimbabwean market that cannot afford to purchase property,” Seatrite explained.
“This gives the investing public a legacy investment within the property sector and allows investment into an international hotel project previously denied to the Zimbabwean investing public.”
The REIT structure also brings tax benefits.
Once listed, all rental income will be tax free, particularly advantageous for pension funds. Through law, 80 percent of net rental income must be distributed annually to unit holders.
So far, more than half of the units have been taken up.
“More than 54 percent of the issue is already subscribed and we will be looking for a further US$6 million from the market,” the trust revealed.
Units will be listed on the VFX once the property is operational, giving investors liquidity and the ability to trade their holdings.
Investors are locked in for the 24-month construction period, but quarterly valuations are expected to deliver steady capital appreciation before rental income begins flowing.
The Seatrite REIT represents a significant milestone for Zimbabwe’s property sector, combining global hospitality management, a tax-efficient investment structure and exposure to a high-value asset.
