Weak demand for office and industrial space, declining revenues and increasing debtor and voids, Zimre Property Investments Limited recorded six percent increase in profit to $0.71 million compared to $0.67 million achieved in the prior year.
By Jeoffrey Ncube
The company chairperson, Jean Maguranyanga said the constrained liquidity and demand conditions made the operating environment difficult.
“Resultantly, the property sector continued to experience weak demand, declining revenues and increasing debtors and voids.
“Demand for office and industrial space deteriorated further as tenants continued to either rationalize occupied space or vacate commercial premises to operate from non-traditional locations resulting in excess supply of space in the market.
“As a result of the difficult operating environment, the Company recorded a modest 6% growth in operating profit,” said Maguranyanga.
She added that due to pressure on rental rates and an increase in voids, rental income declined.
“Due to pressures on rental rates and an increase in voids, rental income declined by 12% to $3.4 million up from $1.65 million achieved in 2015.
“Projects income for the year amounted to $2.27 million up from$1.65 million achieved in 2015, a 37% growth.
“Total administration costs were $2.77 million compared to $3.09 million in the previous year, a 10% decrease.
“Included in administration costs was $0.75 million for bad debts. Written off and increases in allowance for credit losses,” she said.
Maguranyanga said despite deteriorating operating environment and tight control measures taken, operating profit grew by only 6% to $0.71 million compared to the $0.67 million achieved in the prior year.
