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Enacy Mapakame Business Reporter
PROPERTY concern, Zimre Property Investments Limited says voids rose to an average 25 percent in the half year to June 30, 2016 as tenants seek cheaper options due to liquidity constraints.

This had a knock on effect on portfolio’s rental income which declined 9 percent to $1,65 million from $1,81 million during the prior year comparable period.

For the period under review, the portfolio debtors increased 5 percent to $2 million from $1,9 million last year.

ZPI chairman Ms Jean Maguranyanga said the challenging economic environment negatively affected the business during the period under review.

“As a result, effective demand for leased space and other real estate products remained subdued.

“The property sector experienced, amongst other challenges, declining rental rates which affected revenues, rising voids and debtors, tenants continued to reduce leased space in order to manage business costs,” she said.

Despite the increase in voids rates, total revenue for the six months was 13 percent firmer to $2,76 million compared to $2,45 million achieved in the same period last year.

Operating profit was 3 percent down to $0,43 million from $0,44 million. Projects income surged 75 percent to $1,08 million from $0,62 driven by the availability of new stand stocks at the Zimre Park project in Ruwa.

ZPI has completed servicing of the Zimre Park Extension and 10 percent of the project is already sold. The project has a total market value of $6 million.

The group has also sold 70 percent of its other residential stands development in Masvingo – the Zimre Park, although selling at a slower pace.

In view of preserving cashflows for its ongoing projects, ZPI did not declare dividend for the period. Management has also indicated it will continue on cost containment measures to maintain a positive performance.

The property sector has not been spared from the challenging macro-economic environment evidenced by a subdued demand and declines in rental revenue across sector.

Peers, Pearl Properties last week reported occupancy levels dropped to 72 percent across portfolios in the first six months of the year resulting in a 2 percent fall in revenue on the back of rental income declines.