First Mutual Properties targets suburban growth, sustainability drive

SAMANTHA MADE

First Mutual Properties (FMP) is shifting its strategic focus toward growth in non-traditional and high-potential segments, including student accommodation and premium suburban markets, as part of a broader repositioning aimed at ensuring long-term sustainability and returns.

In its latest annual report, the real estate group announced that it is deliberately reducing exposure to ageing and underperforming central business district (CBD) assets while scaling up investments in suburban office parks, retail centres, and residential developments.

“FMP applies a structured asset management framework that classifies properties into core, value-add and non-core segments. This supports informed decisions around asset retention, reinvestment or disposal based on location, building quality, tenant mix and return potential,” the company said.

The report confirmed that proceeds from CBD asset disposals are being reinvested into properties with stronger long-term yield prospects. These efforts are part of a broader plan to align the company’s portfolio with evolving market trends and tenant demands.

The company completed the extension of Arundel Office Park during the review period, adding 2,616.5 square metres of prime office space to its suburban portfolio. It also progressed with a mixed-use development in Zvishavane, incorporating student accommodation and residential units.

“Active developments include a mixed-use development in Zvishavane, a retail centre and SME market in Marondera, and additional residential and accommodation projects in Chinhoyi and Bindura. All new investments are subjected to rigorous financial and ESG assessments, with energy and water availability now embedded as critical site selection criteria,” the group reported.

Suburban office parks are performing particularly well, with occupancy levels remaining stable across the portfolio. However, FMP acknowledged that rental collections have been affected by financial pressures on tenants, prompting the company to increase engagement and offer support to maintain healthy occupancy levels.

On the sustainability front, FMP reaffirmed its commitment to integrating environmental, social and governance (ESG) principles across its operations. Key initiatives under implementation include investments in renewable energy—particularly solar power—enhanced water efficiency measures, responsible waste management, and the incorporation of biodiversity considerations into development planning.

The group is also in the process of developing a formal sustainability strategy that will guide future ESG reporting and policy alignment.

“Sustainability is an increasing focus for the business, particularly as we shift our portfolio towards SME lending. FMM has introduced a sustainability screening process and avoids funding environmentally harmful activities, such as small-scale gold mining or coal extraction. We actively fund agricultural, aquacultural and renewable energy initiatives that are aligned with our commitment to responsible economic development,” the company noted.

A major area of emphasis is supporting Zimbabwe’s transition to clean energy. “FMM is funding solar installations for both households and SMEs. This initiative not only advances green finance, but also responds to the pressing need for reliable power in the face of Zimbabwe’s national electricity supply challenges,” the report stated.

The group’s deliberate pivot towards more sustainable and resilient asset classes reflects a long-term strategy to build value in a challenging economic environment, while also playing a proactive role in Zimbabwe’s development through environmentally responsible investments.