PrimeTime's six-month profits at P40.4m
Pauline Dikuelo | Monday May 30, 2022 08:38
“While rental levels from existing properties have been relatively flat, the increased income and projected growth are coming from the new properties, Pinnacle Park and Lobatse,” she said. During the reporting period, the group’s rental income and revenue from contracts with customers were P79.8 million. According to Matumo, vacancies are low and where tenants have moved, they have and are finding good covenant replacements. “This is indicative of the quality of our assets, confirming the strength of our portfolio fundamentals. We have worked hard to look after our tenants and properties during this time as well as bedding down our new developments successfully,” she said.
The Lobatse Junction retail centre, which was opened in October last year, is reported to have been fully occupied by November 2021 while the final unit at the Pinnacle Park, which was practically completed right at the end of the 2020 financial year, has now been let out. In terms of the development pipeline, the two property disposals brokered in the prior financial year, namely retail centres in the rural locations of Gantsi and Ramotswa, were transferred by the end of January 2022.
The proceeds of these are being redirected into the first building of Prime Plaza II at CBD, Gaborone. The major extension to Boiteko Mall in Serowe is still being considered on the back of strong tenant demand and we have land to extend Pinnacle Park. Running parallel to this, Matumo said management and the board continue to partner with funders to restructure and reduce the group’s overall debt ratio levels. Moving onto costs, she said there are some key drivers of the increase recorded during this period. Matumo said some of these costs such as the refurbishment and compliance costs are investments into the group’s future and she expects to reap the benefits in the years to come. “New properties such as Lobatse Junction, by their nature as multi-tenanted retail malls, carry a higher cost base.
Generally, across all the regions we operate in, utility and municipal costs have increased above inflationary levels and recoveries must continually be adjusted upwards to keep pace where possible. Additional refurbishment costs have been incurred this year to fill vacancies with suitable tenants. There is a cost attached to improving our board structures, governance, and ongoing compliance in an increasingly regulatory environment,” she said.