ZB clings to its land
LIVINGSTONE MARUFU
DIVERSIFIED listed financial services concern ZB Financial Holdings (ZBFH) has put on hold its plans to sell residential stands amid indications that few clients are able to access United States dollar loans due to the obtaining volatile environment.
Whenever the country is in an inflationary environment, various lending institutions hold on to property and acquire properties to preserve the bank’s balance sheet against the unstable economic environment.
ZB corporate services head Shadowsight Chiganze told Business Times that the financial institution will resume selling residential stands when the situation has improved.
“The group is not selling any stands at the moment, although we are in the process of development. We will update the market on progress in this regard at the opportune time,” Chiganze said.
A number of local companies are tapping into property sector in order to unlock value and hedge its investments as fixed-term investments on the money market continue to lose their appeal.
In a volatile market where the Zimbabwe Stock Exchange (ZSE) companies have been grappling with forex shortages and inflationary environment, a combination of pent-up demand from local home seekers and freed-up land for investments, particularly in peri- urban areas, has created a lucrative investment avenue for banks.
Most local companies, especially banks, are beginning to leverage on their long-term assets to invest in the property sector to preserve value.
Chiganze said ZB’s current land bank is 638ha (made up of commercial and residential). The target is to grow the land bank by about 20 hectares mixed between commercial and residential.
The bank’s land bank was below 600ha by June 30 last year.
He said the group is buying for development and will sell as completed units.
The bank acquired over 63 Hopeview stands last year and the management is evaluating what can be done with the strategic land that goes to the Bulawayo Airport for the financial institution to monetise that land.
ZB is still assessing the viability of the Plumtree housing project as the cost of doing business has almost doubled in the process.
The bank said the cost of setting up an offsite infrastructure has skyrocketed as a number of contractors want to be paid in United States dollar.
The bank has also acquired a farm in Ruwa where it is in the process of regularising with the Housing and Social Amenities ministry together with five cooperatives.
Chiganze said the financial institution now wants the residents to start paying the land to ZB, who are the owners of the land.
He said the construction of other projects will depend on the stability of the exchange rate and prices.
