Suburban office parks boom as firms abandon CBDs

Investors in Zimbabwe's upmarket office parks are recording strong demand, as corporates and small businesses accelerate their shift away from central business districts (CBDs) in favour of modern suburban developments.

Property firms report occupancy levels of up to 93% in new office parks, a stark contrast to vacancy rates of between 40% and 60% in traditional CBD office spaces, underscoring a major structural shift in the country's real estate market.

Sector leaders say the transition is no longer cyclical but reflects a deeper transformation in how businesses operate and where they prefer to locate.

Masimba Holdings chairman Gregory Sebborn said refurbishment projects had temporarily weighed on rental income but were expected to drive long-term growth.

"In the property sector, a temporary 3% decline in rental income was recorded due to ongoing refurbishment of some rental properties. However, once completed, these improvements are expected to drive revenue growth," he said.

He added that the company's Impali housing project in Shurugwi is nearing completion, with stand sales already underway.

At First Mutual Properties, chairman Elisha Moyo said demand remains firm in essential services, logistics and neighbourhood retail, supported by increasing dollarisation and improved income predictability.

However, he noted that the CBD office market continues to weaken.

"In the CBD, demand for large office space remains subdued, driving rentals lower and pushing vacancy rates to 40%–60%," Moyo said.

"As a result, property owners are adapting and repurposing existing buildings to meet growing demand for smaller office units from SMEs and startups."

First Mutual Properties reported revenue of US$8.97 million and a portfolio valuation of US$136.1 million for the period under review.

Eagle Real Estate Investment Trust asset manager Bevin Ngara said demand is increasingly shifting towards modern, integrated developments.

"Residential projects remained dominant, while commercial demand increasingly favoured emerging precincts over the decaying CBD," he said, adding that Mazowe Mall is nearing full occupancy at 93%.

The REIT reported total income of US$3.58 million, with total assets rising to US$39.46 million.

Meanwhile, WestProp Holdings chairman Michael Louis said ongoing projects and sustained investor confidence position the company for long-term growth.

"With key projects advancing steadily and on schedule, coupled with sustained investor confidence, the group is exceptionally well-positioned to deliver enduring value," he said.

Mashonaland Holdings chairman Grace Bema described the sector outlook as mixed, warning that CBD office markets continue to deteriorate due to changing business models and declining rental yields.

Mashonaland Holdings recorded a 13% increase in revenue to US$8.1 million.

Industry analysts say Zimbabwe's property market is mirroring broader regional trends, where post-pandemic work patterns are reshaping urban real estate.

Across southern Africa, including in South Africa, Zambia and Botswana, developers are increasingly shifting capital towards decentralised business districts, retail parks and mixed-use developments that combine work, residential and leisure spaces.

While the long-term trajectory remains positive for modern developments, sector players say sustained growth will depend on macroeconomic stability, improved access to capital and coordinated infrastructure investment.