Demand for retail rental space grows
Tigere Property Fund says demand for rental space at its properties remains firm, a scenario that has driven the company to repurpose unoccupied spaces to cater for the growing number of prospective tenants.
The company was the first to list its Real Estate Investment Trust (REIT) on the Zimbabwe Stock Exchange (ZSE). According to Tigere, there is also a strong waiting list of tenants to take up any available space on its assets.
This comes as its buildings currently have a 100 percent occupancy level. Its two properties under the REIT, Highland Park and Chinamano Corner, have experienced good business and strong tenant demand since opening.
“Both Chinamano Corner and Highland Park Phase 1 maintained their stellar performance for the quarter. Both assets are coveted real estate assets and remained fully occupied and showed increased customer footfall.
“Due to robust tenant demand, certain unutilised space is being converted to generate additional rentable area,” said Tigere in an update for the third quarter to September 30, 2023.
With additional space created to meet tenant demand, Tigere also anticipates seeing marginal growth in rental income.
Meanwhile, the ongoing development at its Highland Park Phase 2 is expected to be completed before the end of this year.
“We are pleased to announce that Highland Park Phase 2 shall be opened prior to the busy Christmas season and should improve turnovers for the existing tenants due to increased activity in the node.
“Tigere REIT holds a pre-emptive right to acquire Highland Park Phase 2 on completion,” said Tigere.
For the quarter under review, the property firm realised a net property income of US$1,2 million and a total comprehensive income of US$0,8 million. Rent per square metre was US17,75.
The REIT closed the period under review with a net asset value of US$22,5 million.
The property market continued on a growth trajectory, with a number of developments ongoing across the country. In the capital city of Harare, demand for suburban office space continues to soar as many corporates are migrating from the central business district (CBD) to escape challenges such as increased congestion, high parking fees, and heavy traffic enforcement.
According to Tigere, more activity is being witnessed in the retail sector as the economy continues to grow and tenants continue to demand good quality leasing options. However, infrastructure spending on key arterial roads and maintenance provides an ongoing challenge for property developers.
Tigere Real Estate Investment Trust was incorporated in Zimbabwe in 2022 and was listed on the ZSE on November 30, 2022.