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Business Reporter
Zimre Property Investments Limited is going to take a cautious approach on its proposed construction of a state of the art office park in Borrowdale as potential tenants continue to close shop, Finance manager Nyasha Zhou has said.In an interview with The Herald Business yesterday, Mr Zhou said a lot of companies with the potential of taking up space at the proposed office park have closed and this posed a challenge on the future of the project.
The property company plans to invest about $13 million on the construction of the state of the art office park along Borrowdale Road and the project has already been issued with a compliance certificate from the City of Harare.
“We managed to secure a piece of land (two hectares) at the end of last year along Borrowdale Road that we hope will address part of the challenges in our portfolio mix. We were looking at areas outside the Central Business District for a development that will culminate into an office park at some stage.
“The intention is to take the project forward as it will be approved by various structures. This is a long term development,” he said.
ZPI struck a pact with the Harare City Council that could see the parties mutually benefiting from the relationship and the property firm is now looking at financing options for the project to take off.
He said no financing model has been suggested so far but the company will continue looking at options
Mr Zhou said due to the flat rental market, it had become necessary to diversify away from the traditional rental income which is the greatest contributor to the company’s revenues and maintain a project pipeline that will be able to generate alternate income
The property firm is also looking at developing 238 stands in Ruwa after the project was put before National Physical Planning department after having received approval from the Ministry of Local Government, Public Works and National Housing.
ZPI is expected to invest about $5 million to start developing the residential property project and the construction of this residential facility is part of the company’s long term plans to boost revenue.
Mr Zhou said all the company’s projects are still at preliminary stages and the company is looking at investing in low cost housing projects to boost revenue.
The property market has emerged as the best in terms of returns, compared to other forms of investments.
And several financial institutions and insurance firms have invested heavily in the sector.
CABS, the country’s largest mortgage lender, FBC Building Society, Nicoz Diamond, Fidelity Life and other private firms have taken the lead to build houses and service stands for high income earners to bridge the gap left by Government, which has been failing to provide a number of crucial social services to Zimbabweans.
In a market that has been hit by lack of property development due to the high costs of construction projects and liquidity problems, residential projects by the companies would, in a small way, give relief to buyers who can still afford to purchase properties.
Online Reporter