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Monday, July 15, 2024
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Pension funds invest in real estate to preserve value

Story by Stanley James, Business Editor

Zimbabwe’s ongoing infrastructure development projects are attracting investments into the real estate sector where pension funds are being invested to maintain value.

More funds are being invested by pension companies in the residential, industrial, and commercial real estate industries.

These include the Highland Park Mall in Harare, Palm River Hotel in Victoria Falls Marondera Mall, Eastgate SME’s Mall, and Land Banks, among others.

The pension funds now have a stake in at least 80 per cent of buildings in cities and towns across the country.

Insurance and Pensions Commission Director for Pensions, Mr Cuthbert Munjoma said, “Pension funds are interested in the real estate sector because it matches their liabilities profile. Furthermore, these are long-term investments and need long-term assets hence the reason they are devoting more of their income to such portfolios. It’s entirely linked to the fact that they want to preserve the value of investments.”

Growth in government infrastructure is also attracting more participation from the sector.

Chartered Valuation Surveyor and Registered Agent, Mr Simon Chaita noted, “Basically, it means that pensioners are guaranteed their funds if the pension funds invested them (the funds) accordingly within the property portfolios. In fact, over the years there has been more of these funds being heavily linked to shopping malls, offices and industrial  parks, among others.”

Despite huge capital outlay, Zimbabwe’s real estate sector has been cited as a viable investment portfolio.

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