Tigere bullish about property sector outlook
Tigere Property Fund is bullish about the outlook period with demand for its properties strong amid revelations tenants are scrambling for space in its assets, which currently have a 100 percent occupancy rate.
According to Tigere, the first Real Estate Investment Trust (REIT) to list on the Zimbabwe Stock Exchange (ZSE), there is a strong waiting list of tenants to take up any available space on its assets.
The company indicated that its two properties under the REIT, Highland Park and Chinamano Corner, have experienced increased customer traffic during the period under review.
“New tenants, among them restaurants, have opened for trade underpinning the strong performance of the two assets,” said asset manager Brett Abrahamse in a performance update for the half year to June 30, 2023.
“The surrounding areas continue to benefit from having high-quality retail shopping experiences. Occupancy reached 100 percent during the period under review due to an upsurge in demand for space at our assets. There is also a strong waiting list of potential tenants,” said Mr Abrahamse.
Tigere Real Estate Investment Trust was incorporated in Zimbabwe in 2022 and was listed on the ZSE on November 30, 2022.
During the half-year period, the REIT registered a net property income of US$861 949 while distributable income came in at US$567 392. Rental income totaled US$790 523 for the six-month period. The net asset value stood at US$22,5 million.
The period under review was, however, not easy as the economy experienced inflationary pressures as a result of the continued decline of the Zimbabwe dollar against the US dollar.
However, the economic measures implemented by authorities in the second quarter of 2023, have managed to stabilise forex rates through tight liquidity management.
Commodity and agricultural prices remain relatively high, which has provided a strong source of US dollars into the economy. A general slowdown towards the end of the second quarter has been attributed to the wait-and-see investor attitude associated with any election period and monetary policy tightening.
As for the property market, it continues to see transactional growth in the sale of existing stock and numerous developments taking place across the country.
Steps to improve the regulatory environment for the property market are being taken by Industry and government, which will make it easier for all investors to participate.
Increased demand for properties due to a growing population as well as outdated stock has also provided significant growth opportunities. Tenant demand within most sub-sectors remains strong due to a shortage of quality stock.
Meanwhile, construction of Highland Park Phase 2 is progressing well, according to the company, and is expected to be completed in the fourth quarter of 2023. The Tigere REIT holds a pre-emptive right to acquire phase 2 on completion.-herakd
