Masholds disposes Charter House
RYAN CHIGOCHE
Zimbabwe Stock Exchange listed property firm Mashonaland Holdings is going to dispose of the Charter House for US$7.4m after a deal to reconfigure the property to a hotel fell through.
In 2018, Mashonaland Holdings said it would reconfigure the property into a hotel and went through all the processes with Harare City Council and also roped in Chinese firm Touchroad International as a partner for the project.
Due to the Covid-19 constraints, the partner decided to first rebuild in China for two years before coming to Zimbabwe resulting in the mutual termination of the MOU.
Masholds MD Gibson Mapfidza said yesterday the company has since accepted an offer to sell the property for US$7.4m.
“We got a very compelling offer that we couldn’t turn down in December last year. We are going through a process and we have signed some agreements now for a total of US$7.4m to dispose of the asset,’’ Mapfidza said.
“The disposal will reduce our portfolio CBD concentration which has been a stumbling block in terms of achieving desired returns .The idea is to create finance by reducing concentration in the CBD through disposal and redeploying those funds to Borrowdale road, Pomona and Zvishavane as part of financing our diversification thrust.”.
The property concern widened its loss to ZWL$1.4bn in the 15 months ended December 31, 2021 from ZWL$671m reported in September 2020.
The group property investment portfolio was valued at ZWL$13.9bn representing a 11% capital loss from the valuation recorded as at 30 September 2020.
The company board chairman Grace Bema attributed the capital loss to the CBD concentration where there is low demand.
She said the company was going to diversify their portfolio and tap into new markets as a counter strategy.
“The Harare CBD sector has been negatively impacted by a reduction in space demand due to worsening urban problems such as deteriorating building infrastructure, street trading, congestion, noise pollution and the high building operating costs among others. Thus the group strategy is premised on portfolio diversification to reduce the CBD office concentration…’’ Bema said.
As a push to its diversification, Mashold has made some strategic acquisitions.
It acquired a 4ha site at the corner of Harare Drive and Alpes Road. The development concept consist of wholesaling and flexible warehousing and 50% of the development has been pre-eased. This is in line with the company’s portfolio rebalancing thrust.
The company has also acquired a 2ha site along Borrowdale Road where it plans to develop a modern office park. It has pre-leased about 40% of the space.
In the residential sector they have also invested in the Mashview Garden cluster housing project in Bluffhill. The houses were sold upfront and works have already commenced and the company is targeting to complete all 25 cluster by the 4th quarter of this year. The project has a value of US3.6m
In the health sector, pre-construction works have already commenced the 12 Van Praagh Day Hospital with the group having secured a change of use permit in December 2021 from residential to medical use.
Construction of the health care facility is expected to commence in the 2nd Quarter of 2022 and to be complete in the next 15 months. The project has a development budget of US$3m.
