Enacy Mapakame Property Reporter
There is need to rethink property uses in Harare’s central business district to match market trends and cushion the sector from growing voids, industry experts have said.
This comes as commercial properties in the Harare’s central business district (CBD) have been recording increases in vacancy levels as companies move to suburban areas.
In a recent interview, Old Mutual Zimbabwe group chief executive Jonas Mushosho said the decay of the inner city was not unique to Zimbabwe alone but a worldwide phenomenon with companies moving out to less congested areas.
“This has happened in other areas too like in South Africa’s central Johannesburg for instance, where companies have moved to areas like Sandton. This is always followed by a process of renewal of the inner city. A lot of work has to be done for renewal of the inner city. We think some of the buildings in the city need not to be refurbished only but to think about alternative uses as well in line with the market,” he said on the sidelines of the group’s annual general meeting held in the capital recently.
In light of the increasing voids in the CBD against high demand for residential space, Mr Mushosho indicated the property market in conjunction with the City of Harare were exploring a number of options to remodel current buildings into alternative uses in line with market trends.
One of the options analysts have suggested include conversion of commercial properties into residential. Mr Mushosho said, Old Mutual, which owns several commercial properties in the country was also considering alternative use for its buildings.
“We are looking at a number of options for our properties and that (conversion into residential) is not excluded from our plans,” he said adding that the group’s Eastgate Market that should cater for small to medium enterprises was one of the financial giant’s processes towards inner city renewal.
The Eastgate Market, which is expected to open in July this year will provide retail space for the booming SMEs and will have refrigeration facilities as well as accommodation facilities in line with market needs. In a previous interview, the Real Estate Institute of Zimbabwe (REIZ) president Mike Juru said demand was currently on the residential properties side ahead of office space, especially in the CBD.
As such there was need for a shift in town planning to allow for property firms to turn their buildings into residential, than keep white elephants. A trend analysis of property stocks such as First Mutual Properties (FMP), Old Mutual, Zimre Property Investments (ZPI) and Mashonaland Holdings show that commercial properties in the CBD have been problematic as demand has been skewed towards residential developments.
Indications are that business in the CBD has been on a downward trend as their commercial clients move to surrounding residential areas or Office Parks to escape congestion in the city or find a more pleasant environment.