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Property market records low retail space uptake – Turnstar

Publishing Date : 05 August, 2019

Author : LAWRENCE PAGANGA

The property market in Botswana remains subdued due to the economic climate prevailing in the country resulting in little demand for space from new investors, a property investment company has announced.


In its 31 January 2019 financial report released this week, the Botswana Stock Exchange (BSE) listed company, Turnstar Holdings said a slow-down had been recorded in companies not opening new retail stores in the country. Addressing shareholders and the media at the Turnstar Holdings financial report ending 31 January 2019 this week, the group’s Managing Director and Founder , Gulaam Abdoola was, however, quick to announce that the company was in a stable financial position with its assets solid and the company recorded asset value of P2 billion for the year under review .


“In Botswana the property market is challenging at present, due to the economic climate prevailing.  There is very little demand for space, from new companies coming to Botswana,” Abdoola announced. He said most retail space in the country was occupied by large South African retail companies who were facing operational challenges in that country.


“These groups are also slowing down on opening new stores, as they are not performing well in South Africa.  There are a few citizen retail companies that occupy space, on a very limited basis.  However, our properties are still in demand and are doing well. “The retail market grew despite the prevailing market conditions in the industry.  However, in the short-term, it is likely that the retail market space has reached saturation.  The average yields for retail properties in Gaborone were eight percent,” said Turnstar Holdings MD.


The latest financial report shows that the group’s properties in particular, the Game City in Gaborone and Nzano Shopping Mall in Francistown posted fair value gains. Game City is Turnstar’s flagship and it is also the premier retail shopping centre in Botswana. “Game City had a tenancy rate of approximately 95 percent and continues to attract large listed or multinational companies who constitute approximately 80 percent of tenants as well as all the large banks.  The mall posted positive growth in rentals and yields during the year and continues to record the highest ‘footfall’ of retail malls in Botswana,” said Abdoola.


Turnstar also own and manage the Mogoditshane Centre, the Turnstar House, the GICP at the Commerce Park, Tapolongo Estate, and Mogoditshane Townhouses all located in Gaborone. “Revenue generated from commercial properties is P30 million during the reporting period with an average yield of eight percent.  Revenue generated from residential properties is P86 million.  Turnstar’s light industrial property in Commerce Park had a full occupancy rate during the reporting period.  Demand for light industrial properties in Gaborone and in prime location remained strong,” Abdoola told shareholders.


The group has also in recent years ventured into Dar Es Salam in Tanzania and Dubai, the largest and most populace city in the United Arab Emirates and Turnstar is operating malls and offices in the two countries.  The Milimani City in Tanzania is a US$100 million mixed use premier shopping and conference complex.  Turnstar also acquired an office block in Dubai valued at US$8.35 million.  The office is being leased on a long-term basis with a net rental yield of seven percent.


“In Tanzania there a lot of international brands waiting to come to the mall.  (In Dubai), it is busy bustling with tons of tourists and new emigrants coming in.  There is still a lot of opportunity there and we are busy exploring a few proposals,” the Turnstar MD said. However, Abdoola told shareholders that the company would not buy properties just to create bulk in the company, but that future acquisitions would be for adding value to the company and the shareholders.


“Turnstar is very keen to expand its Botswana portfolio.  We are considering a few acquisitions and will be carrying out due diligence,” he said. Meanwhile, Turnstar board chairman, Patrick Balopi has announced the retirement of Ishmael Nshakazhogwe as the company’s non-executive director. Nshakazhogwe is the chairman MD of Zambezi Group of Companies and Thailand’s Consulate General to Botswana.  “Mr Nshakazhogwe has served on the board of Turnstar, since its inception 2002,” said Balopi. Turnstar employs 125 people.

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