Chigunduru told shareholders at the company’s AGM on Tuesday that George Square property in Kamfinsa was almost complete and tenants were already completing the fittings ahead of the June 2012 opening.
However, Pearl had re-tendered the Kamfinsa Cluster House development and a contractor had been identified, and contract negotiations were in progress. The Arundel Office Park expansion had been put on hold pending the completion of tenant negotiations,” he said.
Pearl Properties posted an operating profit before tax of US$1,568 million for the quarter ended April 30 2011, on the back of a 10% rental income growth. The company achieved US$2,804 million in rental income against US$2,552 million in the prior year.
Property expenses at US$447 086 for the period were 48,68% below the budgeted US$871 166, but a massive 125,14% above US$198 585 figure from the same period last year.
Chigunduru said operating profit was better than the budgeted US$906 974, but was 20,47% lower than the US$1,972 million achieved during the prior year in the first quarter.
He said the group had experienced a decline in rental yield to 8,18% from the yield of 9,80% achieved in the same period last year due to the dilutive effect of property revaluations which were ahead of rental increases.
Earlier this year, analysts were concerned about the heavy revaluation gains on Pearl’s property portfolio, which they felt would affect the company’s performance going forward.
Average rental per square metre was, however, 3,96% higher at US$7,62 from US$7,33 during the prior year. Chigunduru was confident that the company would take the collection rate to 90% by year-end. However, for the period, the rate was 74,9%, 3,48% worse than the 77,6% achieved last year.
He said occupancy levels were slightly higher at 78,6%, compared with 77,5% prior year. During its AGM, shareholders also approved the appointment of four new directors to the board, namely, Andreas Mlalazi, John Travlos, Jessica Mugabe and James Gibbons.