FML eyes SMEs market

Published: 26 May 2014

First Mutual Holdings Ltd has come up with measures to mitigate the low uptake of industrial space in its property division as the market suffers under liquidity challenges.

The property sector has been experiencing an increase in the rate of voids and defaults as the economy continues to face challenges.

In an interview on the sidelines of the First Mutual Health launch in Harare last Friday, FML group chief executive Mr Douglas Hoto said the company had divided some industrial space to cater for small to medium enterprises.

"Our industrial properties have not been performing very well and contributed the greater part of voids because the actual manufacturing is not happening. So to mitigate that problem we have cut them up to cater for SMEs and warehousing," he said.

He added that there was mixed performance in the property sector at the moment and the company is in the process of rolling out strategies to increase its revenue inflows.

Mr Hoto said the retail space and office parks had been performing well while CBD offices were still facing challenges. FML property company, Pearl Properties, registered increased rental income by 2,06 percent to $9,012 million in the year to December 31, 2013.

However, occupancy level fell by 3,3 percent to 76,3 percent, as a result of a decline in space demand due to economic challenges exacerbated by increase in vacations, evictions and company closures.

"The market is slow but we are working on some projects in the property division and we are funding these from internal resources," he said.

FML rebranded its medical insurance business from First Mutual Medical Services Fund to First Mutual Health.

The product is expected to increase the provision of medical care by the group to more Zimbabweans.

- BH24