Botswana Stock Exchange (BSE) quoted Property Company, RDC Property said this week that it has began to rip from its investment on the Masa Centre ÔÇô one of the first buildings to be erected at the new Gaborone Central Business District (CBD).
The refurbishment and rebranding of Masa Square Hotel added an additional fully operational 30 luxurious Masa Executive Suite apartments which has to date since marketing exercises began in May has recorded a 61 percent occupation rate.
RDC properties Limited Chairman, Guido Giachetti said Thursday at the presentation of the unaudited half year results ended 30 June 2016 that the dividend distribution the Group will make was assisted by Masa Centre.
This contribution according to Giachetti is the first time that the property assists the dividends cash payout. The half year period results show that interim distribution cash payout is up by 35 percent.
The Group anticipates deriving P7.3 million from the property by the end of 2016. Its financials shows that for the six months ended 30 June 2016, the property had cashed in P3.3 million.
The results also recorded an increase of 5 percent in rental revenue from P39.6 million that had been registered in 2015 to P41.7 million in 2016 which Giachetti highlighted was due to the contribution from Chobe Marina Lodge.
“The lodge performance is benefitting from growth in the tourism industry and excellent management of the property. The lease is linked to the revenue of the Lodge hence the significant growth in rental income,” cites the results statement.
The results also show a marginal rise on the profit from the Group’s operations which increased by 8 percent to P29.7 million from P27.5 million in 2015. This flat increase is indicative of the difficult market conditions which the Group also alluded to. However regarding profit before tax, a significant rise is observed, increasing by 42 percent to P26.2 million from P18.5 million in 2015. Regarding the Group’s property portfolio expansion it was announced that the high-end flats located in Extension 9 which will soon be released into market will cater to location conscious customers with an up-market status.
The flats, which have a 40 year existence, will be given a facelift by the same architect and designer who revamped the Masa Square Hotel. The Group does however mention that the residential market contributes minimally to the property portfolio adding that such smaller growth is consistent with the cycle of the economy. It was also shared that 50 percent of the leases under the portfolio will expire beyond the year 2020. Giachetti mentioned Standard House which houses the commercial bank Standard Chartered, as a steady income stream given the nine year lease signed by the bank.
The group chairman also shared details on the Group’s regional diversification. He mentioned the fallback of the development of a Business Hotel in the CBD of Cape Town, South Africa that had been proposed citing that issues relating to the subdivision of the property which had been a standard condition. Regarding projects in Mozambique Giachetti shared that despite the looming political unrest, the Group will invest in two joint venture projects, at 65 percent and 55 percent shareholding respectively, and although a slow process the Group remains committed to the projects.
