African Sun to Sell Monomotapa Hotel

The Zimbabwe Stock Exchange-listed hospitality group, African Sun Limited, has announced plans to sell its flagship property, the Monomotapa Hotel Crowne Plaza in Harare. The move comes as part of a strategic initiative to streamline its hotel portfolio and reinvest proceeds into other operations, including a comprehensive refurbishment programme across its properties.

In a recent statement, African Sun highlighted its goal of aligning the hotel portfolio to meet evolving trends in the local and global hospitality industries. This vision is underpinned by a recent merger with Dawn Properties, transitioning African Sun's focus toward managing and operating unique hotels across Zimbabwe, rather than Dawn functioning mainly as a property-owner. This shift, African Sun stated, reflects its commitment to crafting memorable guest experiences through targeted management and operational enhancements.

The board has approved a strategic plan prioritizing selective asset disposal to free up resources for promising investment opportunities within the portfolio. Central to this plan is the upcoming sale of the Monomotapa Hotel, a historic property celebrating its 50th anniversary this year. Proceeds from the sale will be directed towards portfolio enhancement and ongoing refurbishment efforts, aiming to ensure African Sun's properties remain competitive and offer top-tier comfort.

African Sun has already made substantial investments in portfolio improvements, drawing on the expertise of locally recruited executives with international experience to lead this ambitious refurbishment drive. Two of its ten properties have undergone extensive facelifts, with efforts now focused on securing additional capital to modernize other hotels in line with international quality standards.

The group operates several other properties across Zimbabwe, including Elephant Hills Resort, The Victoria Falls Hotel, Holiday Inn branches in Harare, Bulawayo, and Mutare, as well as Troutbeck Resort, Caribbea Bay Resort, Hwange Safari Lodge, and the Great Zimbabwe Hotel. With the consolidation strategy in motion, African Sun also plans to explore new expansion opportunities in high-demand destinations like Victoria Falls and other potential sites across the country.

The company's latest financials for the half-year ending June 30, 2024, reflect improved performance, with revenue up by 14% from the same period last year, totaling US$25.58 million. Although the group posted a post-tax loss of US$2.17 million, attributed to non-recurring costs, operating profit was bolstered by an increase in average daily rates, which rose from US$103 to US$112. Occupancy also saw an uptick, closing at 50% compared to 46% last year.

African Sun's operating expenses, excluding depreciation, amounted to US$14.09 million—a modest 1% increase despite inflationary pressures in the first quarter. The group credited the containment of overheads to improved procurement and cost-monitoring practices, essential as the company navigates price fluctuations following Zimbabwe's new currency introduction.

African Sun remains optimistic that its strategic repositioning will benefit both guests and shareholders, providing the foundation for a robust, sustainable presence in Zimbabwe's competitive hospitality market.