The Sunday Mail
Livingstone Marufu —
FIDELITY Life Assurance (FLA), which has successfully hedged the bulk of its portfolio in property development and investments, is confident of selling the first batch of stands from Langford Estates before the end of the year after it completed all the necessary procedures.
FLA expects to generate more than US$201 million profit before tax from the sale of 11 624 Langford Estates residential stands at a price of US$14 400 each. The 834-hectare Langford Estate is also projected to grow the life assurer’s balance sheet.
FLA said surveys and delays in some works in Southview Park had held back progress. The company’s MD, Mrs Nyaradzo Matindike, told The Sunday Mail Business that property development in Langford would replicate success recorded in other housing projects undertaken by the firm.
“We are happy to tell our clients that all the permits are now in place as we have completed the surveying processes. We envisage to begin the sales of the stands later in the year or very early in 2017 since we have done all required process to start our work at Langford Estates.
“Since the land is quite big some of the civil works at Langford will begin in 2017 … There has been a slight delay in completing some works at Southview Park, the water tanks are the major works that will be completed by the end of this year. Once those are complete we will move on to begin work at Langford,” said Mrs Matindike.
Buoyed by the successes of the Manressa and Southview Park projects, Fidelity assumed CFI Holding Limited’s bank loans amounting to US$16 million last year when it acquired Langford Estates in a land-for-debt swap arrangement.
Fidelity wants to invest about US$50 million in development of the new project. Langford Estates will use Southview Park off-site infrastructure as part of the company’s cost-cutting measures.
Fidelity expects total revenue of close to US$400 million from all its three investments, with Manresa Fidelity Park expected to bring US$7 million and Southview Park and Langford forecast to generate US$100 million and US$300 million respectively. The Langford Estate project could have a 250 percent return on investment.
In the long run, the life assurance company will venture into business stands. Besides dealing with internal issues such as cost build-up, Fidelity has had to contend with low disposable incomes that are affecting demand.
This reduces the group’s target market’s purchasing power, making products more expensive. The politics surrounding the governance issues of the company seem to have taken their toll as most of the projects were stalled due to a forensic audit. However, Mrs Matindike blamed the delay to the processes associated with servicing stands.
