Monomotapa Hotel to be offloaded for US$15 million

African Sun Limited (ASL), Zimbabwe's leading hospitality group, has announced June 30, 2025, as the target date for concluding the sale of the iconic Monomotapa Hotel, which is estimated to be worth nearly US$15 million.

The hotel, situated in the heart of Harare's CBD and currently serving as ASL's registered head office, has been on the chopping block since 2024 as part of the group's broader strategy to dispose of non-core assets and boost capital for higher-yield investments.

In its audited financial statements for the year ended December 31, 2024, ASL disclosed that the Monomotapa Hotel was listed under "disposal group assets" valued at a combined US$19.13 million, a category that also included the Great Zimbabwe Hotel and its property-holding subsidiary Laclede Investments.

The Great Zimbabwe Hotel, along with Laclede, was sold last month for US$4.2 million, implying that the remaining US$14.94 million in asset value is largely attributable to the Monomotapa Hotel.

"The group resolved to sell Monomotapa Hotel during the year and has been actively marketing the hotel. The transaction is expected to be completed before 30 June 2025," ASL confirmed in its financial statement.

The sale of the Monomotapa Hotel comes after a turnaround in performance. The hotel posted a US$883,293 loss in 2023 but bounced back to register a profit after tax of US$88,992 in 2024, supported by a 12% drop in expenses and revenue growth from US$5.59 million to US$6.16 million.

ASL board chairperson Lloyd Mhishi said the divestments were part of a strategic shift to focus on core assets.

"As part of its strategy, the board approved the sale of several non-core assets, and the Great Zimbabwe Hotel and Monomotapa Hotel were earmarked for sale," Mhishi said.

"After year-end, the sale of the Great Zimbabwe Hotel has been consummated, and ownership was transferred with effect from 1 April 2025."

He also confirmed that ASL discontinued Sun Leisure Tours, its travel and transfer division, on March 31, 2024.

The sale of Monomotapa is expected to enhance ASL's liquidity. The group closed 2024 with a strong cash position of US$9.77 million and no external debt.

The firm also made significant strides in refurbishing its existing portfolio. Completed upgrades at Hwange Safari Lodge in 2024 are set to be followed by renovations at Holiday Inn Harare, Elephant Hills Resort, Troutbeck Timeshare Lodges, and a second phase at The Victoria Falls Hotel.

"These strategic capital investments aim to enhance guest experiences and grow the portfolio's market share," Mhishi said.

"Additionally, the group will embark on the second phase of the Marlborough Sunset Views residential development, targeting 55 stands."

Group revenue rose 15% to US$53.98 million, driven by improved occupancy rates and an increase in the average daily rate from US$115 in 2023 to US$119 in 2024.

However, a US$2.57 million additional tax assessment by the Zimbabwe Revenue Authority for the 2019 financial year saw ASL close the year with a US$689,162 loss, down from a US$50,748 profit in 2023.

Despite the setback, Mhishi said ASL remains confident about the recovery of the tourism industry, citing positive trends in both local and international travel.

"The tourism sector does, however, face significant risks from economic and geopolitical challenges," he cautioned.

"The suspension of foreign aid funding by the United States is expected to negatively impact business from non-governmental organisations and other government-funded programmes. Locally, business activity is expected to remain subdued due to tight liquidity and low government expenditure."