More articles in this category
Top Stories

Swapo 2017: What Have They Done This is the second part in a series where The Villager will analyse what each of 11 Swapo Party top four candid...

Adv. Vekuii Rukoro has said that the German government is trying to avoid the charges lodged against it for the Ovaherero and Nama genocide during...

Swapo 2017 What Have They Done Series This is the first part in a series where The Villager will analyse what each of 11 Swapo Party top fou...

The Attorney General Sakeus Shanghala said the recent shack demolitions at Katima Mulilo were illegal because the town council did not have a cour...

SWAPO party Secretary General Nangolo Mbumba has today inaugurated the SWAPO disciplinary Committee at the party’s Head Office. The Commi...

Other Articles from The Villager

Kwanza swap has Angolans flocking to Namibia

Mon, 31 August 2015 22:29
by Staff Writer
Business

Recently-implemented regulations allowing the exchange of the Angolan Kwanza for Namibian dollars has brought back some Angolan shoppers, Simonis Storm Securities (SSS) have revealed.

James Cumming, Director of Research at the SSS, said Angolan shoppers are returning, although not at the same levels as in 2014. The high oil price is having a significant impact on them.

“The restrictions brought in earlier this year which limited the amount of hard currency Angolans could carry had a patent effect on the number of Angolans shopping in Namibia,” Cumming said.

This comes at a time when property creator Oryx Properties released their 2015 financial results. Cumming said although the results were good, the company will be tested in an ever-increasingly overcrowded shopping mall environment in Namibia.

Windhoek’s shopping malls are up for head-to-head competition, resulting in an overcrowded shopping mall environment.

Grove Mall, which is Namibia’s largest shopping mall, opened its doors in October last year, competing head- on with Maerua Mall.

Meanwhile, Ohlthaver and List recently announced plans to expand Wernhil Park to become the largest mall in Namibia by 2017. “The value of investment property currently stands at N$2 205.7mn, which represents an 11.56% increase, while details are sketchy at the moment, but it is competition nevertheless,” Cumming said.

Although the Grove Mall construction itself is complete, the adjacent buildings such as the gym, hospital, flats and office space are still under construction.

Once complete, this eco-system around the Grove could offer substantial competition to Maerua as the destination of choice for shoppers and mall rates.

The net rental income for Oryx properties increased by 19.0%, and rental cash flow increased by 31.5% on the back of the Maerua Mall expansion and the acquisition of Gustav Voigts in 2014.

Cumming said this should normalise from 2016 onwards, if no other substantial acquisitions are made.

“We are pleased to see the vacancy level at 0.7% for 2015, compared to 0.9% in 2014, and we believe that this figure will be kept below 1.0% over the next few years,” he added.

The contribution to revenue from the retail, industrial and office sectors equates to 61.9%, 27.6% and 10.6% respectively, compared to 57.4%, 34.3% and 8.3%, respectively in the 2014 financial year. Oryx properties also recorded that operating profit grew by 42.7%, and profit for the year grew by 79.0%, mainly due to the revaluation of property during the year amounting to N$179.36 million, while in 2014 it stood at N$71.46 million.

“Finance costs for Oryx properties increased by 46.2% due to debt held for the full 2015 year, compared to only being held for a portion of 2014, while the average interest rate on outstanding debt increased by 0.1% to 8.1%, which will continue to rise in the current interest rate environment,”’ he said.

Cumming said the interest rate swaps didn’t have much impact in financial year 2015, but they expect these to have a larger set-off in future, adding that they expect interest rates to rise by 50 to 75 basis points over the next 12 months.