THE property market has hit an all time low in Gweru with some shops and offices in the city’s central business district (CBD) now empty owing to the high cost of rentals.
Vacancy for office and shop space stands at 20 percent in the Midlands capital as some business shy away from the CBD, opting to occupy office space in suburbs close to the city centre like Windsor Park, Gweru East and Athlone.
Real Estate agents here have been forced to revise downwards their rentals as an incentive to tenants.
Trevor Dollar director, Victor Wasara, blamed the liquidity crunch for the slump in occupancy.
“Businesses continued to be plagued by serious liquidity challenges in the economy, which has not spared the property sector, hence some tenants prefer to set up their offices outside the CBD where rates are relatively cheaper.
“Those who have remained in the CBD have resorted to subletting to other tenants in order to spread the rental costs. Some of the buildings in the CBD are now virtually empty… We are now renegotiating our contracts downwards as we monitor the situation,” said Wasara.
Rentals, which are normally pegged at US$15 per square metre in some of Gweru’s affluent buildings, have been reduced to between US$6 and US$9 per square metre.
Verocy Real Estate property consultant, Martin Chivhoko noted that shortage of money circulating in the economy had depressed business despite that local rentals were within the regional benchmarks.
He said: “If you look at rentals of our regional neighbours like South Africa, Botswana and Namibia you will see that rentals are within those levels, but the only challenge we have is that people here do not have disposable incomes because of a depressed economy.
“Therefore, business is now coming from the big mining corporates in the province and other blue chip companies who can afford such high rentals.
“However, we are now reviewing our rates instead of letting the buildings lie idle,” said Chivhoko.
A survey by leading real estate firm, Knight Frank, shows that rentals in Zimbabwe are 30-40 percent lower than what is obtaining in the region, a development which has been linked to the economic slowdown.
Follow us on Twitter on @FingazLive and on Facebook – The Financial Gazette