ENPF TO DEVELOP NEW SHOPPING CENTRE

MBABANE – The Eswatini National Provident Fund (ENPF) continues to show growing interest in commercial and retail property investments.

As such, the fund is preparing to develop a new retail centre at Checkers, Mbabane.  The fund has already invited sealed Bids from eligible Bidders for the proposed retail development on Portion 1072 of Farm 2 Mbabane.  According to the tender document, the works entail the construction of the shopping centre. bidding is open only to locally registered firms that hold a valid registration certificate issued by the Construction Industry Council (CIC), category B1, and of which at least 60 per cent of the controlling shares are owned by emaSwati.

Bids must be delivered on or before August 20, 2024, at 11:00am (Eswatini Time). Electronic bidding will not be permitted.  In an interview with this publication, ENPF Chief Executive Officer (CEO) Futhi Tembe, shared that the organisation owns a 1.7063-hectare land located at Plot 1072, Farm 2, Mbabane, along the strategic Sozisa Road. Tembe said acquired in 2011, the property is currently vacant. She said developing this vacant land is seen as a strategic move to alleviate traffic congestion in the city centre, while simultaneously generating socio-economic benefits such as job creation and the revitalisation of economic activity in the city of Mbabane.

“This development also aims to address the shift of consumer spending by Mbabane residents to elsewhere. The fund envisions direct ownership of a retail business as a diversification of its business ownership model, distinct from its indirect involvement in other businesses in which it has investments,” said Tembe.  The CEO added that the practical completion date of the project is 18 months from the time of the tender award. Tembe also highlighted that as a shareholder in the Industrial Development Corporation of Eswatini (IDCE), the Fund already owns the Swazi Plaza Shopping Centre and the New Mall, both in Mbabane.  She said, however, increased traffic congestion due to nearby food retailers has adversely impacted foot traffic on Dr Sishayi Street, leading to tenant attrition.

Fund

It is worth noting that ENPF has invested in a number of businesses in the country across different sectors. The fund owns 100 per cent of the Happy Valley Hotel and partly owns the Bhunu Mall and Lojaf to name a few. The fund also owns 4.46 per cent shareholding at FNB Eswatini, which was listed on Eswatini Stock Exchange (ESE) last December.  The fund is also part of the Montigny Investments’ shareholders owning 7.69 per cent. As part of growing its local investments portfolio, last year the ENPF reported to have acquired a 22.5 per cent stake in Unifoods, a local milling and pre-packing company.

The shares were worth E60 million and through this acquisition, the Fund stated that it believed that it would contribute to addressing the issues of food security and job creation in the country. The fund also invested E57.7 million in convertible preference shares of Eswatini Mobile. It is also worth noting that in its annual report for the year ended June 30, 2023, the fund reported a healthy 85.9 per cent year-on-year increase in investment income from E319.8 million in 2022 to E594.6 million in 2023.

Overall

This increase in investment income comes after the payment of investment management fees. This led to the fund’s overall performance in 2023 being favourable compared to the previous year. As such, the operating surplus for the year was E446.4 million,” said ENPF. The fund further reported their achievement of a surplus of E446.4 million, a substantial increase from E192.8 million in 2022. Total assets exceeded total liabilities by E144.2 million, indicating a healthy financial position. ENPF’s investment strategy prioritises a net real Emalangeni return of inflation plus five per cent over a three-year rolling period.

The fund utilises a diversified investment approach with 67 per cent of assets allocated locally and 33 per cent held offshore. In the 2023 report, the fund reported that Board members have appointed seven asset managers on full discretionary mandates for regional and offshore investments.

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