Mishma Chakanyuka, Staff Writer 
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FIRST Mutual Properties (FMP) says the office segment was subdued in 2022 owing to the need to re-adjust from the newly-formed remote working models.
Market watchers have since attributed the current trends to the “new normal” conditions prompted by the Covid-19 pandemic, which saw many companies shifting to online-based work practices as opposed to physical brick and mortar.
However, with the easing of the number of Covid cases, people began to slowly re-adjust back to working full-time in the offices, while some still opting for working remotely.
Elisha Moyo, the listed real estate firm’s chairman
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“The CBD office experienced the highest vacancy rates forcing most owners to re-model their properties to cater for the Small and Medium Enterprises (SMEs) sector,” chairman, Elisha Moyo, said in the company’s 2022 annual report.
During the year, the leasing market for commercial space was the most active segment, with buoyant activity in the retail and industrial sectors.
The retail, industrial and residential sectors enjoyed relatively huge activity during the year, while in contrast, commercial property transactions were low due to huge investment requirements.
“Limited commercial property developments seen during the period under review have largely been self-funded, and are being used as a hedge against currency and inflation risks as well as possible future rental increases,” Moyo said.
The group recorded inflation-adjusted net property income after administration expenses of $140,5 million from $589,4 million in 2021 despite a 42 per cent growth in revenue to $2,9 billion.
Foreign and local currency rental mix was 70 percent to 30 percent at the end of the year and this enabled the company to preserve value from foreign currency and inflation risks, while creating capacity to finance its ongoing capital and growth expenditure programs from internal resources.
Collections decreased to 72 percent from 82 percent in the prior year particularly on the back of the country’s contractionary policies.
Moyo highlighted that the business is striving to maintain buildings in lettable and safe conditions, as such, a total of $528 million was deployed towards maintenance of buildings.
“The company will continue to commit resources towards enhancing the quality of its product offering,” he added.
In terms of property valuations, an independent property valuation conducted by Knight Frank Zimbabwe as of December 31, 2022 ,valued the property portfolio at $109,3 billion compared to $22 billion in 2021, representing a growth of 397 percent.
