Tower Property Fund changes distribution policy amid Covid-19
The group, which previously paid out 100% of distributable earnings, says it will only pay out 75% for its year to end-May
Tower Property Fund, which has assets in SA and Croatia, says it has changed its distribution policy in light of Covid-19.
The group is a real estate investment trust, and is required to pay out at least 75% of distributable earnings annually. Tower said it would reduce its payout to the minimum, and while this would be revised from time to time, it does not expect to pay out more than 90% going forward.
“Tower has, for some time, considered whether the payment of 100% of its distributable income to shareholders is sustainable, given the need for defensive capital expenditure on its portfolio,” the group said.
The group said on Thursday that its distribution per share for the year ended May will be about 44.5c, 40% lower than the prior comparative period.
Tower owns 43 properties valued at R5bn, with six assets in Croatia accounting for 32%, as of its six months to end-November.
In afternoon trade on Thursday, the group’s share was up 0.77% to R2.62, having fallen 48.12% so far in 2020. This gave it a market capitalisation of R890m.
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