Tigere anticipates revenue growth

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ZIMBABWE’S only exchange-traded Real Estate Investment Trust (REIT), Tigere Property Fund, says it expects to grow its revenue after reaching full occupancy at its initial properties.
The Terrace Africa Asset Management (Terrace) fund, which started trading on the Zimbabwe Stock Exchange at the beginning of December, turned over US$162 646 during that month.
“Well-located real estate, with strong leases, will continue to be a hedge against inflationary pressures within Zimbabwe,” the asset manager said in a statement accompanying the fund’s results.
“We expect further growth in US$ revenue contribution for the next reporting period.

“The shopping centres have shown positive growth in customer visits and average turnovers, as new restaurants open and cement their position in the new respective nodes.”
The asset manager also said it had identified additional income areas through various leasing and marketing opportunities. The fund’s initial property portfolio comprised two commercial properties — Highland Park Phase 1 and Chinamano Corner.
The fund says it has entered into pre-emptive agreements with various partners and developers to purchase a pipeline of prospective properties, which could be added to the portfolio.
The REIT declared a maiden dividend of US$152 577, as well as an additional $75,8 million in respect of the period ended December 31, 2022.
On the ZSE, the REIT’s units have gained about 23 percent this year, closing yesterday at a price of $50,53 per unit.
The fund’s positive performance has contrasted with the country’s property market, which has generally remained subdued, with significant vacancy levels in various sectors. Covid-19 severely impacted the property market and further increased vacancy levels, especially in certain subsectors such as Harare’s central business district (CBD). The broader office sector outside of the capital’s CBD has also been affected due to reduced demand for space and the pandemic-induced working-from-home arrangements.
Terrace, however, says the continued growth in small businesses has slowly started to stimulate some demand for working space, with co-working spaces gaining popularity, particularly in suburban areas.
“The retail sector has been relatively resilient largely due to limited availability of quality trading space,” Terrace said in the fund’s prospectus.
The retail sector remains a relatively defensive property subsector due to the need for essential groceries and consumables.
“Growing consumer health consciousness brought about by the Covid-19 pandemic has also fuelled demand for health and pharmaceuticals retail space and remodelling of existing space to cater for these changes,” the property management firm said.
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