Sefalana Group Managing Director, Chandra Chauhan announced that they would be focusing on growing their property portfolio this year.
Presenting the group results last week, Chauhan said they have placed a lot of focus and emphasis on growing and developing their Botswana property portfolio, which is currently worth around P500 million.
Speaking to BG Business Chauhan said they are currently in the process to buy an eight-hectare plot that will be developed for a new store. “We have been looking at a number of other sites for purchase or development and this has resulted in a time cost recovery charge relating to senior management that is greater this period than in the comparative period.
Rental streams remain strong and the property portfolio is now virtually fully tenanted,” said Chauhan. He said they have already submitted the plan to the City Council and they expect to start construction as soon as the plan is approved. “To increase our property portfolio and our stores we want to buy a plot in Mogoditshane.
This will be our new store. We have already submitted the plan to the city council and it is a beautiful plan,” said Chauhan. The group has recently purchased 42 000 sqm site in Block 10 (Setlhoa plots). “We intend to carry out a significant development in the forthcoming year.
Details of this development are still being finalised but are likely to include our largest to date Sefalana Shoppers Supermarket and a petrol station,” said Chauhan. During the period the group has purchased the building that previously housed the Golden Fruit juice business in Ramotswa, Delta Dairies Property in Broadhust.
Chauhan said this year they are planning to renovate the property in Ramotswa as it is in a prime location for a large cash and carry for the customers in that area. He said the delta dairies will allow the group to carry out the necessary developments to the sites to enable the group to move the fruit juice plant to this site from Ramotswa along with newly introduced beverages.
In Zambia Sefalana group property is on shaky grounds as that country’s government has discontinued the use of US dollar as a secondary currency and enforced the use of the Kwacha. Chauhan said this resulted in a significant weakening of the Kwacha against global currencies and rental leases will now have to be converted to Kwacha and this exposes the group to additional foreign exchange risks.
“The value of the net investment in Zambia is worth less than it was at April 2015 Pula terms. This has resulted in a significant P25 million foreign exchange loss for the period,” he said. However he said the Zambian property is fully let and continues to generate a very good rental stream. “We don’t know what the impact will be on the group profits as time goes on,” he said.
He added that they are also looking at potential property investments in Namibia to support their planned growth in the country. In November 2015 Sefalana acquired its 14th store in Namibia in Swakopmund and other potential sites are also being considered for additional store openings.