• Centre’s revenue up 12%
• Reduces vacancies
• Company rental revenue up 4%
RDC Properties, a Botswana Stock Exchange (BSE) listed property management and property Development Company, has registered satisfactory financial performance for the half year period ended 30 June 2015.
The company’s executives presented the results on Friday and noted that despite the subdued market, mainly in the office sector space, the company has remained resilient.
During the six month period, the company’s investment and property portfolio grew by 11 percent and now stands at P963.2 million while rental revenue went up by four percent to reach P39.6 million from P38 million registered in the previous period while the share price increased by 13 percent during the period.
Masa Centre is said to have been the major contributor to the group’s overall revenue having secured new leases at the property.
The recent IPD Botswana Annual property index 2014 report has shown that there was a decline in the local property market with total ungeared return from 21.5 percent in 2013 to 11.5 percent in 2014. However, RDC reports that its return for the same period was 15.5 percent.
Masa Centre remains the best performer in the company’s property portfolio with its revenue having increased 12 percent to P18.4 million compared to the P16.5 million in 2014 due to rental escalations, growth of Masa Hotel turnover rental and reduced vacancies at the centre.
The company has also announced that vacancies over the whole portfolio have decreased from 5.22 percent at December 2014 to 3.67 as at June 2015 with Masa centre now contributing 47 percent of the vacancies compared to the previous 69 percent as of December of last year.
RDC Managing Director, Guido Giachetti said the group is looking at other markets. He said they have already entered into a partnership with owners of prime land in the CBD of Cape town, South Africa and consultants have been appointed. The Cape Town project is expected to consist of four star hotel developments with more than 180 rooms and conference facilities.
Apart from South Africa, the group is also pushing further for regional expansion with Namibia and Mozambique on its radar. The group’s expansion drive is expected to further improve the status of the well balanced portfolio across various segments.
With regard to Mozambique, Giachetti said the economic outlook for the country is promising with the current oil and gas developments taking place. He said the controlling shareholders of RDC have invested in an engineering consulting firm in Mozambique, to among others, source development opportunities for RDC.
The targeted areas of investment are the retail and hospitality property sectors. In Namibia, Giachetti said the outlook is promising with a stable political environment, positive economic prospects with a development of new mines and diversification of the economy. In Namibia, RDC, according to its MD, is reviewing opportunities in the retail and hospitality property sectors.
On the company’s outlook with regard to the local market, Giachetti said they expect the property market to remain subdued and have pinned their hopes on sectors such as hospitality and retail while the office market is expected to face challenges in that there are a lot of office blocks rising in the CBD.