eBusiness Weekly
Michael Tome
Mashonaland Holdings rental income grew by 45 percent to close its first quarter to December 31, 2019 to push total revenues for the quarter to $10 million.
This comes on the back of constant rental reviews by the firm in line with rising inflation that have seen spiralling of basic goods and services price.
The company attributed the surge in income to a positive impact of rent reviews during the quarter.
Albeit the rising cost of living Mash holdings indicated that occupancy level remained flat in December at 76, 2 percent compared to the same period last year.
Occupancy levels however decreased marginally from 77 percent due to reduction in the office sector tenants in December 2019.
However, the company has had a positive start in 2020 reflected by a surge in occupancy levels in in January.
“Subsequent to the quarter ended 31 December 2019, the group managed to let new space, in the Office sector which increased occupancy levels to 77,6 percent at January 31, 2020,” said Mashonaland holdings in statement accompanying the trading update.
Property expenses to revenue ratio in the period under review however declined by three percent to 16 percent compared with 19 percent property expenses to revenue ratio achieved during the same period last year.
In the quarter ending December 31, 2019 administrative expenses to revenue ratio stood at 35 percent compared with 32 percent that was achieved in the prior year attributable to the impact of growing staff cost of living as the property concern handed out cushioning allowances to its staff and other related costs.
There was also a general increase in administrative expenses which were higher as compared to the inflows of revenue.
To remain afloat in business the group said it has begun rental reviews on a quarterly to salvage value.
Going forward the company is optimistic and looking at growing its property base into more profitable areas.
“The company will continue to explore opportunities to preserve shareholder value primarily through acquisition of strategic assets to feed into the development pipeline. Despite the development sub-market getting more risky, the company will carry on with some of its construction projects.”
Early last year Mashonaland Holdings managing director Gibson Mapfidza cited tourism infrastructure, student accommodation and out of Central Business District (CBD) office space as lucrative areas for property investments going into the future.
