Gulf Complex Idle

The business complex that the City of Harare developed in partnership with an international property developer along Simon Mazorodze in Mbare appears to have become a white elephant as businesses struggle due to the country's harsh economy.

A US$10 million joint venture project between the City of Harare and a private investor, El Nour United Engineering Group, resulted in the development of the Harare Gulf Sunshine Bazaar, a business complex comprising of 500 shops and industrial incubators to house small businesses.

Although the complex was supposed to have opened in June last year, it is yet to open for business amid indications that it is struggling to attract tenants in an economy where even commercial property owners in Harare's central business district are experiencing vacancy rates as high as 60 percent.

Construction of the project started in September 2014 and it was scheduled for completion within ten months, but workers were last week still putting final touches on the property.

Gulf Complex Idle

There was no indication as to when the complex would open.

Efforts to get an update from Harare City Council spokesman, Michael Chideme, over the past three weeks were fruitless; the Zimbabwe Union of Journalists president did not respond to questions from the Financial Gazette's Property News, despite promising to do so.

The questions sent to Chideme also sought his comments on what effect the economy and the high vacancy rates had on this project.

It was Chideme who told this newspaper last year that the complex was scheduled for opening by June that year.

Most small-scale traders, for whom the complex was constructed, are trading freely on the pavements of the streets in Harare as they avoid paying rentals to property owners.

As a sign that all is not well, work on a site next to the Harare Gulf Sunshine Bazaar, where a similar project was being developed, has been abandoned.

What makes the complex a likely white elephant is that a similar project that the City of Harare developed in another joint venture with Augur Investments - the Mbudzi People's Market - which was opened in November last year, has not been viable for traders. The 200 tenants who had taken up space at the market have deserted the complex due to poor business.

Some of the tenants have of late been advertising their shops, with some of them getting so desperate as to offer cash rewards to anyone who could get them tenants to rent the shops.

However, property being a long-term investment, all hope is not lost as the City and its partner in the Harare Gulf Sunshine Bazaar would still be able to get a return on their investment when the economy rebounds in the future.

The El Nour United Engineering Group, owned by some Lebanese business tycoons, is known to be a long-term property investor. The company is the owner of the Gulf Complex, a double-storey shopping mall in Harare whose construction was completed in 2004.

The group is involved in similar projects in several African countries as well as in the Middle East.