ZIMRE Property Investments (ZPI) Ltd has announced plans to unveil a US$5,6 million residential stands project to be known as Zimre Park extension in Ruwa this September.
At an annual general meeting held in Harare on Wednesday, ZPI MD Edson Muvingi said the project has 229 stands that average 800 square metres on a total 603 795 square metre lot.
Projected total income on the project is US$6,9 million, giving an expected profit of US$1,3 million on the projected set to be completed by August 2015.
The rate of return on the project, according to ZPI projections is 22%.
The new project will add to already running projects in various stages of development.
Muvingi said the company’s US$7 million Zimre Park Masvingo project that has 338 stands has managed to sell 178 stands.
The scheme has 47% of stands in terms of area and recovered 63% of total costs to date in sales worth US$3,1 million.
“Our only worry in Masvingo is the time, it has taken us to recover our money and the profits, but we have payments coming in every month,” he said, adding this is a result of the liquidity challenge.
He said going forward, the group would focus on completion of the Masvingo and Bulawayo projects.
ZPI also has US$3,7 million high density residential stands scheme in Harare’s Tynwald suburb which has a total 288 stands averaging 200 square metres.
Muvingi said 64% of the stands have been sold to date at a value of US$2,5 million, enough for the company to recover 96% of its project cost.
“By end of year we would have recovered all our costs,” he said.
The project’s return is estimated at 41%.
In terms of financial performance for the first five months of the year to May 2014, Muvingi said ZPI operating profit went down by 29% to US$1 million from US$1,4 million in the prior period.
The operating profit was 12% off budget after total income slid by 22% to US$2,5 million compared to US$3,2 million over the same period last year after a 38% slump in project sales and 5% decline in rental income due to liquidity challenges.
Project sales amounted to US$906 696 compared to US$1, 5 million in the same period in 2013.
Other income, went down significantly by 79% in the period under review to US$29 398.
Staff costs to income ratio was 18% compared to 17% prior period after personnel costs went down by 17% to US$439,779.
The operating profit margin was 41% down from 45% in 2013.