CHAIRMAN’S STATEMENT
Overview of Operating Environment
The operating environment was relatively stable, largely due to tight monetary and fiscal policies pursued by the Authorities. The country continued to operate a multi-currency system, with the US dollar remaining the dominant currency for commercial transactions, including property rentals and sales. Average US dollar inflation rose to 12.39% in 2025 from 2.48% in 2024. Against this backdrop, the ZWG exchange rate depreciated by 0.71% against the US dollar, compared to a 47% depreciation in the prior year. Despite this stability, consumer demand remained weak in some sectors, resulting in subdued trading performance across a segment of our tenant base.
The portfolio’s sector composition, comprising commercial, retail, industrial, office and residential assets, delivered diversification benefits. Demand was strong for assets in essential services, logistics, and neighborhood retail. However, selective exposure to discretionary retail required proactive tenant engagement and lease administration. The increased dollarisation of rental income improved cash flow predictability and portfolio valuations.
Investor interest in income-generating real estate assets with defensive characteristics remained strong throughout the year. The Group maintained a disciplined approach to asset management, tenant retention and capital allocation, thereby positioning the portfolio to preserve value and deliver stable, long-term returns.
Property Market Overview
The office market is showing a notable divergence. In the Central Business District (CBD), demand for large office space remains subdued, driving rentals lower and pushing vacancy rates to 40%-60%. As a result, property owners are adapting and repurposing existing buildings to meet the growing demand for small office units among small and medium-sized enterprises (SMEs) and startups.
There is a growing trend of corporations relocating to suburban areas, driven by the need for modern facilities, improved infrastructure, and reliable utilities. Notable developments include the head offices of Ecobank, Stanbic, and First Capital Bank in Borrowdale. Suburban office parks, particularly in the north, have low vacancy rates and high demand, with spaces leased much more quickly than in the CBD.
Business Performance Review
The Group’s net property income was US$4,566,700 (FY 2024: US$4,842,676) with total revenue at US$8,968,710 (FY 2024: US$9,027,117). Rental income remains the primary revenue source.
Rental collections for the year remained resilient at 80%, supported by a healthy average occupancy of 84%. Management continues to engage constructively with tenants to resolve outstanding arrears, reinforcing long-term relationships and the sustainability of cash flows. In parallel, there has been a heightened focus on tenant and portfolio diversification to strengthen income stability and reduce concentration risk. First Mutual Properties remains steadfast in its commitment to delivering safe, secure and high-quality facilities, underpinned by ongoing asset care and enhancement. In support of this objective, US$857,971 was invested in infrastructure maintenance during the year, ensuring the portfolio remains competitive, resilient, and well-positioned for future growth.
Property Valuations
An independent valuation by Knight Frank Zimbabwe placed the Group’s property portfolio at US$136,078,000 as at 31 December 2025, up from US$132,948,000 in December 2024. This represents a marginal 2.35% uplift in investment property value following the year-end revaluation.
The uplift was driven primarily by fair value gains, supported by higher US dollar-denominated rentals and the impact of targeted capital expenditure and asset enhancement initiatives undertaken during the year, which strengthened the portfolio’s quality, functionality, and income-generating capacity.
Developments
The recently completed new office block at Arundel Office Park was successfully leased to a blue-chip tenant. The business continues to explore development opportunities to enhance shareholder value. Modern developments, such as the new office block at our Arundel Office Park and utilisation of our land bank at Golden Stairs, form part of our strategic thrust and development pipeline.
Commitment to Sustainable Value Creation
We remain firmly committed to conducting our business in a way that creates long-term value while safeguarding environmental, social, and governance (ESG) principles. Sustainability is embedded in our operations through responsible property management, prudent resource utilisation and ongoing investment in asset resilience, energy efficiency and climate risk assessment. First Mutual Properties will continue to ensure that developments contribute positively to the broader socio-economic environment through sound governance, ethical business practices, and disciplined risk management, which are key to balancing commercial performance with social responsibility and supporting sustainable growth for all stakeholders over the long term. The recently completed new Arundel Office Block has a 75kwh solar system which is net metered to the grid.
Dividend
At a meeting held on 16 February 2026, the Board of Directors recommended that no dividend be paid for the quarter ended 31 December 2025. This brings the total dividend paid for the 2025 year to USD134,300, being USD0.000108 cents per share and ZWG1,249,500 being ZWG0.001 cents per share.
Acknowledgements
On behalf of the Board of Directors of First Mutual Properties, I would like to express my sincere gratitude and appreciation to my fellow directors, management, and employees for their collaborative efforts, which delivered results across all administrative, operational, and financial areas throughout the year. I would also like to acknowledge our strategic partners, tenants, and service providers, whose continued alliance and support remain integral to our success and long-term growth.
Business Outlook
The business outlook for 2026 remains cautiously optimistic, supported by expectations of continued economic growth, moderating inflation and relative currency stability. Improved macroeconomic conditions are expected to boost business confidence and planning certainty, while ongoing policy discipline should underpin investment across key sectors. Nevertheless, the operating environment is expected to remain challenging, requiring continued focus on cost control, liquidity management and operational efficiency. To this end, management will prioritise income growth, deepen portfolio diversification into the SME sector, enhance asset resilience and uphold prudent risk management practices to navigate the year ahead sustainably.
Directorate
It is with deep regret that the Board records the passing of Mr Samuel Vengai Rushwaya on 18 March 2026. The Group is deeply saddened by this loss. Mr Rushwaya had a long and distinguished association with the First Mutual Holdings Limited Group, during which he made a significant and valued contribution to the development and success of the organisation. He became a member of the FMP Board on 24 October 2023. The Board extends its sincere condolences to his family, friends and colleagues during this difficult time.
Elisha K. Moyo
Chairman of the Board
16 February 2026
