Tower Property Fund in strong growth phase

Tower Property Fund continues to grow, and as part of the funds strategy to acquire well located, quality properties, has recently announced a number of new acquisitions located in strong areas throughout South Africa.

The first building is the Sunclare office block which is being purchased at a cost of R192 million.  This purchase consists of the majority of sections of Sunclare, which is located on the corner of Protea Road and Dreyer Street in Claremont – just across the road from Cavendish Square.

Tower purchased the majority of sections of this terrifically located building which is perfectly poised to capitalise on its location and offers competitive rentals to smaller and larger businesses wanting an entry to Claremont.

15 Wellington Road, situated in Parktown in Gauteng, at a cost of R80.5 million is another property being purchased from a private owner.  The property is fully let, well located, has significant parking and has recently been refurbished.

A large industrial portfolio is being acquired from a private South African property investor.  The portfolio consists of eight well located industrial buildings in Gauteng and Kwazulu Natal.  Modern distribution centres are included in the portfolio, with a large Pick n Pay distribution centre – with a long lease – being the jewel in the crown.

A 12 000m2 lower LSM shopping Centre is also in the process of transfer.  This brings the number of lower LSM properties Tower has purchased in 2015 to four, and provides Tower shareholders access to this ever growing segment of the market.

Tower has secured approximately R1.2bn worth of commercial property in the past eight months and has another R1bn pipeline which it expects to bring to the market within the next six months

Marc Edwards, CEO of the Tower Property Fund says that the growth is pleasing as all the properties are yield accretive to the fund.  “Whilst growth in size is not the main goal, it does allow us to diversify our risks in certain sectors of the market which have been underperforming.  We had a stated goal of growing the fund by R1.2bn within 24 months of our listing and we have certainly exceeded that.  Growth also allows us to recycle some non-core assets and we have recently sold and are currently concluding the sale of smaller properties which do not fit with the growth strategy of the fund.”

Tower is committed to reducing its impact on the environment and reducing its tenants cost of occupancy by continuing to undertake energy reduction programme’s at its major properties.  The fund has formed a green committee amongst its board members who oversee the “greening” of the portfolio.  The members of this committee are green heavyweights and include the current Chair of the World Green Building Council, the inaugural CEO of the South African Green Building Council and a developer who has produced two of South Africa’s green star rated office properties.

“We believe our green approach provides us with a competitive advantage by improving our properties which retains our tenants and reduces environmental impact at the same time,” concludes Edwards.