ZIMRE Property Investments (ZPI) will not shift its business strategy and vision after de-listing from the Zimbabwe Stock Exchange (ZSE), MD Edson Muvingi told Standard Business on Friday.
BY TAURAI MANGUDHLA
Muvingi’s comments came after Zimre Holdings Limited (ZHL) shareholders approved an acquisition of the entire ZPI stock at the end of September. ZHL holds a controlling stake in ZPI.
The deal means that ZPI will have to de-list from the ZSE.
Both firms currently trade their shares on the Zimbabwean bourse, with ZHL’s pursuing interests in insurance operations while ZPI has developed a massive property portfolio in the country with land banks across major cities.
“For me, it (the de-listing) is more of consolidation,” Muvingi said.
“This de-listing is a shareholder strategy, but the actual business strategy remains the same,” he said.
He said the de-listing had not affected a massive plan to rope in big property owners with buildings in a prime zone of Harare’s central business district (CBD) to come up with a project that would completely transform the area.
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The plan involves redeveloping properties into top-end real estate gems with an expanded scope of services spanning from boutique hotels to housing units.
Many of the buildings have been run down through years of economic turmoil, which made it difficult for investors to give the properties facelifts. Muvingi’s vision will require millions of dollars to accomplish.
For now, it is not clear if property owners were ready to take up the offer.
But he said that should his proposal flop, he would proceed with redeveloping ZPI assets in the zone that includes First and Sam Nujoma streets.
Up to US$40 million would be required to complete the work, he said.Negotiations towards the deal had begun, said Muvingi.
“The numbers are not small, but it is the vision that we have,” he said.
“We have Nelson Mandela Avenue, First Street, George Silundika Avenue and Sam Nunjoma Street.
“In that block, we have been talking about Real Estate Investment Trusts (REITs) for a while.
“Our view is that everyone, who owns a property around that area can come together and do one big development.
“That’s our approach in terms of how we want to develop.
If we can’t convince everyone to be part of that development, then we do our own because we have three properties there.”
During the half-year ended June 30, 2020, ZPI posted a profit of $946,67 million, from $580,67 million in the same period last year despite total revenues having declined by 29% to $27 million.
This was after a fair value adjustment of $963,03 million.
Rental income grew by 27% to $24,21 million from $19,05 million attained in the corresponding period in 2019.
“Projects income significantly declined during the half-year mainly as a result of the Covid-19-induced lockdown, which restricted marketing of the stands and movement of potential purchasers,” ZPI said.
“Sales amounted to $2,38 million, down from $18,13 million achieved in the previous half-year, an 87% decline.”
