In its annual report for 2020, Turnstar said its rental revenue increased by four percent to P10.7m (over 2.2bn/) whilst operational expenses were contained. “The US dollar appreciated against the Botswana pula, during the year under review. Approx 43 percent of the group’s rental income is in US dollars, resulting in an exchange gain for Turnstar,” the report said adding that the translation gain reported for the year, occurred when translating the US dollar denominated investments and assets of the group subsidiaries in Tanzania and Dubai.
Turnstar which is listed at Botswana Stock Exchange further noted that interest and loan repayments on the US dollar loan facility were made from rentals earned from Tanzanian property hence, there was no foreign currency exposure on the loan and interest repayments.
The report however pointed out that due to the vacancies in the commercial office space at Mlimani City, the local subsidiary reported a fair value loss for the year. “It should be noted that fair values are calculated on current rentals, projected into the future. It does not reflect the actual cost nor the condition of the buildings, and may change from year to year, depending on occupancy levels,” the report added.
The annual report stated that although Botswana properties recorded fair value gains, due to the Mlimani fair value loss, the group recorded an overall value loss for the year. At Mlimani City, Turnstar said it has four property types with 165 active tenants with 56,370 square metres of total lettable area all valued at $960m.
Mlimani City comprises of four distinct components being; Mlimani City Retail Centre which has a total rentable area of 27,465sqm; an Office park with a total rentable area of 15,017sqm; the conference centre which has rental space of 4,903sqm; and a residential complex with 50 free-standing residential units.
“The Mall has always enjoyed good occupancy with a large contribution being from the expatriates’ community. As a result, Mlimani enjoys a large market share in Dar es Salaam,” the report noted while stating that the coronavirus pandemic affected the conference centre immensely.
“The recent refurbishments of the conference facility had however spiked appetite to the conference centre to about 75 percent. The mushrooming of commercial properties in the city has affected our commercial office blocks, coupled with the movement of government offices to Dodoma which left behind offices which are now being occupied at lower rentals,” the report explained.
“A renowned local foundation has signed a five year term lease and will occupy 768 square meters of the office block 6. This signing will attract more investors to Mlimani City Offices. Competition in the city’s residential market is challenging and has been further aggravated by mushrooming of alternative accommodation. However we intend to continue looking for more innovative marketing tools to compete,” Turnstar’s annual report stated.