Harare central business district death continues

According to Mashold, “despite the faltering economic activity, the occupier submarket’s retail and industrial sectors have remained relatively resilient”.

However, investors are not building enough new projects because of rising inflation and high interest rates. PPC says it has raised its USD cement prices three times this year, by a cumulative 12%.

Mashold says: “The development submarket is the most affected as construction costs remain on an upward spiral in both currencies. As a result, the sub-market continues to be dominated by residential property projects and a few small-sized commercial developments. The high interest rates on mortgage lending coupled with declining disposable incomes however continue to act as hindrances against further growth in the residential sector developments.”

For the rich, there is a race for high-end properties, and this is making these properties even more expensive. As other capital markets such as the stock market falter, investors are rushing into property. But there just isn’t enough to buy.

Says Mashold: “Middle to high-income residential properties continue to present investors with an avenue for value preservation as the inflation trend remains uncertain, the high demand against static supply has seen property values in this market segment going up.”

To meet demand for industrial space, Mashold has bought a 4-hectare property in the Pomona industrial park and appointed a project team. Construction starts in October and an anchor tenant has been secured. The company has also started building a private hospital in Milton Park, Harare, which will be completed in August next year.

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