SA firms invest in Zimbabwe’s mega-mall

2011-10-22 09:37

South African companies are set to increase investment in Zimbabwe over the next two years, particularly in the retail and construction sectors.

Construction giants Augur Investments, McCormick Property Development and West Properties are part of a team of architects that are spearheading the construction of what will be known as the Mall of Zimbabwe. The mall is set to be the biggest shopping centre in Africa outside of South Africa.

The investors acquired the land, with an estimated value of $68?million (R548.8?million), from the Zimbabwean government in a barter deal backdating to 2008, when Augur Investments built the Harare Airport road.

McCormick Property Development managing director Jason McCormick said: “The mall will be 45?000m². Construction starts next year. The project will become the biggest property investment in Zimbabwe, worth $100?million.”

The mall will house shops, restaurants, a hotel and a state-of-the-art medical centre. Augur Investments’ Ken Sharpe said the project would be finished in a space of 16 months.

“The Mall of Zimbabwe will be built in about 16 months. It won’t take more than two years,” he said.

Already, 53% of the space has been taken up by South African retail giants. The remaining 47% is still up for grabs for any potential investor.

McCormick said: “Woolworths, Spar, Shoprite and Pick n Pay are some of the investors that have declared their interests in setting up shop at the
soon-to-be-built mall. “By the time we start building, all the space would already be taken.”

South African retail giants seem not to be moved by the Zimbabwe government’s BEE scare. Pick n Pay this week got the Zimbabwean government’s approval to increase its shareholding in supermarket giant TM.

Initially, Pick n Pay controlled a 25% stake in the company. It acquired its 25% when the company was facing of collapse, largely due to the economic meltdown in Zimbabwe before dollarisation.

The new drive means Pick n Pay would have a 49% shareholding and some of TM’s retail outlets would be renamed Pick n Pay.

The president of the African Marketing Confederation, Helen McIntee, said investment in the retail and construction sectors is largely due to Zimbabwe regaining investor confidence and that profits are higher than in any other part of the region.

“There was a time when Zimbabwe was at its lowest but now things are picking up at an impressive speed. Investor confidence is creeping in. There is a new commercial vibrancy with more money to be made in Zimbabwe than anywhere in Africa,” said McIntee.

Most of the food and other items found in the Zimbabwean retail market originate from South Africa because Zimbabwean industries are still struggling to recapitalise after the country’s crippling, decade-long economic recession.

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