Botswana’s listed property sector is showing a widening performance gap, with well-capitalised firms and regionally diversified landlords holding up under pressure while highly leveraged companies struggle to absorb rising interest rates and falling property valuations.
The divergence is highlighted in the latest Botswana commercial property market report by Maru Group, which shows the six property companies listed on the Botswana Stock Exchange collectively account for more than P8 billion in market value, even as earnings across the sector come under strain.
While occupancy levels remain high in key retail and commercial assets, the report says higher borrowing costs, weaker valuation metrics and shifting tenant behaviour are reshaping profitability across the sector.
At the top end of the market, Turnstar Holdings, LetloleLa Rona, RDC Properties and FaR Property Company continue to demonstrate relative resilience, albeit under different strategies and risk profiles.
Turnstar remains one of the sector’s most stable performers, growing rental income to P354.4 million and maintaining a steady dividend for a fourth consecutive year. The company’s profit before tax declined, largely due to an P80 million downward revaluation of property assets rather than operational weakness. It continues to benefit from strong performance at its Mlimani City development in Tanzania and maintains one of the lowest debt positions in the sector.
Letlole La Rona has also maintained solid fundamentals, with revenue rising 16 percent and occupancy levels holding at 98 percent. Despite higher finance costs and softer valuations, the company continues to record full rent collection and is shifting its growth focus to domestic expansion, including a planned retail development in Selebi-Phikwe.
RDC Properties continues to stand out for its scale and geographic diversification. With a portfolio valued at about P5.97 billion across seven African markets, the company reported higher revenue and improved profitability in its latest results. Its regional exposure, including recent investments in South Africa, has helped cushion it against market-specific shocks.
FaR Property Company is emerging as a growth-focused player within the sector, posting double-digit revenue growth and strong operating profits driven by industrial property assets. With relatively low leverage and high rental yields, the company has opted to retain earnings to fund expansion rather than pay interim dividends, signalling confidence in its development pipeline.
However, conditions are more challenging for other listed players.
New African Properties (NAP), long regarded for its debt-free balance sheet and consistent dividend record, is facing uncertainty as key leases approach renewal. While revenue has continued to grow, rising costs and falling valuations have weighed on profitability. The report flags upcoming lease negotiations at Riverwalk Shopping Centre as a critical factor in its near-term earnings outlook.
PrimeTime Property Holdings remains the most financially stretched counter in the sector. Although recent results showed improved earnings, the gains were largely driven by property disposals rather than operational growth. The company continues to carry elevated debt levels and has relied on asset sales to strengthen its balance sheet amid declining property values.
The report says the contrasting performance across the sector underscores the growing importance of debt management, asset quality and strategic flexibility in a higher interest rate environment.
It also notes that future performance could be influenced by increased institutional participation, particularly from the Botswana Public Officers Pension Fund (BPOPF), which holds significant stakes across listed property counters. While potential inflows from pension funds could support valuations and development activity, analysts caution that absorption capacity within the market may become a constraint.
Overall, the sector is entering a period of adjustment in which strong balance sheets, diversified income streams and disciplined capital allocation are increasingly separating outperformers from underperformers.
