Tower ‘pleased’ with first month as listed company

By Nick Hedley

Tower Property Fund (TWR)‚ which is the JSE’s newest property counter having listed in July‚ has had “a good month” as a listed company‚ according to CEO Marc Edwards.

The fund listed on July 19 amid one of the most volatile periods in the listed property sector in recent years. Weakening and volatile bond yields have caused similar price weakness in the listed property sector.

Tower’s shares listed at R8.70‚ although its share price climbed to R10 on its first day of trade. Edwards said Tower’s shares have since “settled back down to around R9.50 — which we expected”.

However‚ the fund’s share price dived 7.37% to close at R8.80 on Tuesday‚ falling harder than a number of other funds which also saw share price declines.

“We are generally happy with where the share price has been and with the trading volumes‚” Edwards said‚ adding that trading volumes had been fluctuating‚ with some days seeing no trades while other days saw up to 800‚000 shares traded.

On average‚ about 2‚000-15‚000 shares were traded daily — in line with expectations given the size of the fund‚ Edwards said.

Tower had received much interest from institutional investors and already had a good spread of recognised shareholders‚ he said.

“We would imagine that activity will pick up once we go ex-dividend and we declare our first interim results.”

The fund’s interim results for the six months ending November are expected to be released in late January or in February.

Edwards said the fund was shielded from much of the volatility in the sector‚ thanks largely to its size. “Being a smaller cap fund‚ we fortunately aren’t as affected by the volatility as some of our bigger colleagues — who are highly liquid.”

He said the fund would focus on ensuring its underlying assets were well run “and we sweat them for what they’re worth”.

Tower’s diversified property portfolio consists of 27 properties valued at R1.65bn — comprising about 30% retail and 70% office assets. The portfolio includes the Cape Quarter complex in Green Point‚ Cape Town‚ and a five-star Green Star-rated office complex in Grayston Drive‚ Sandton.

Among Tower’s credentials which it sees as valuable in differentiating itself in the market is its focus on “greening” its properties over time to save costs and make its buildings more competitive.

hedleyn@bdfm.co.za

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