Brookfield Canada Office Properties to Acquire Bay Adelaide Centre East Development in Toronto
11 July 2013 - 9:45PM
Marketwired
Brookfield Canada Office Properties (TSX: BOX.UN) (NYSE: BOXC)
announced today that it has acquired the Bay Adelaide Centre East
development in downtown Toronto. BOX purchased the property -- a
44-storey, 980,000-square-foot premier office tower currently under
construction -- from parent company Brookfield Office Properties
Inc. (TSX: BPO) (NYSE: BPO) based on a value of C$635 million at
stabilization ($C602 million net of an imputed return on BOX's
equity investment). BPO is selling the asset to BOX on an
"as-if-completed-and-stabilized basis" and will retain development
obligations including construction, lease-up and financing.
At closing, through available liquidity, BOX will pay to BPO
C$170 million representing the amount invested and value created to
date in the project. BOX will commit to fund an additional C$26
million of up-front equity and an additional C$350 million that
will be funded from a first mortgage construction loan.
Additionally, BOX will make a final payment to BPO of C$56 million
on stabilization for an aggregate total investment of C$602
million.
"This acquisition is strategic for BOX as Brookfield's vehicle
for the ownership of its premier Canadian office assets," said Jan
Sucharda, president and chief executive officer. "Today's
announcement affirms BOX's growth strategy and its commitment to
adding value for its unitholders."
The East tower is 60% pre-leased to anchor tenants Deloitte and
Borden Ladner Gervais and is on target to be completed in late
2015. BOX will earn net operating income of C$32 million from
substantial completion of the project.
Bay Adelaide Centre is the newest, best-in-class office precinct
in Toronto's financial core. The East tower is being developed to
the highest level of efficiency and sustainability and will achieve
LEED Platinum certification upon completion.
The West tower opened in 2009 and is 95% occupied.
BOX's board of trustees established an independent committee to
assess the transaction and the committee unanimously recommended
the board of trustees' approval. The committee retained Morrison
Park Advisors Inc. as its financial advisor.
Further details of this transaction are included in a
supplemental information package that is available on BOX's
website: www.brookfieldcanadareit.com.
Forward-Looking Statements This press
release contains "forward-looking information" within the meaning
of Canadian provincial securities laws and applicable regulations
and "forward-looking statements" within the meaning of "safe
harbor" provisions of the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements include
statements that are predictive in nature, depend upon or refer to
future events or conditions, include statements regarding the
Trust's operations, business, financial condition, expected
financial results, performance, prospects, opportunities,
priorities, targets, goals, ongoing objectives, strategies and
outlook, as well as the outlook for the Canadian economy for the
current fiscal year and subsequent periods, and include words such
as "expects," "anticipates," "plans," "believes," "estimates,"
"seeks," "intends," "targets," "projects," "forecasts," "likely,"
or negative versions thereof and other similar expressions, or
future or conditional verbs such as "may," "will," "should,"
"would" and "could."
Although the Trust believes that our anticipated future results,
performance or achievements expressed or implied by the
forward-looking statements and information are based upon
reasonable assumptions and expectations, the reader should not
place undue reliance on forward-looking statements and information
because they involve known and unknown risks, uncertainties and
other factors, many of which are beyond the control of the Trust,
which may cause our actual results, performance or achievements to
differ materially from anticipated future results, performance or
achievement expressed or implied by such forward-looking statements
and information.
Factors that could cause actual results to differ materially
from those contemplated or implied by forward-looking statements
include, but are not limited to: risks incidental to the ownership
and operation of real estate properties including local real estate
conditions; the impact or unanticipated impact of general economic,
political and market factors in Canada; the ability to enter into
new leases or renew leases on favourable terms; business
competition; dependence on tenants' financial condition; the use of
debt to finance the Trust's business; the behavior of financial
markets, including fluctuations in interest rates; equity and
capital markets and the availability of equity and debt financing
and refinancing within these markets; risks relating to the Trust's
insurance coverage; the possible impact of international conflicts
and other developments including terrorist acts; potential
environmental liabilities; changes in tax laws and other tax
related risks; dependence on management personnel; illiquidity of
investments; the ability to complete and effectively integrate
acquisitions into existing operations and the ability to attain
expected benefits therefrom; operational and reputational risks;
catastrophic events, such as earthquakes and hurricanes; and other
risks and factors detailed from time to time in our documents filed
with the securities regulators in Canada and the United States.
Caution should be taken that the foregoing list of important
factors that may affect future results is not exhaustive. When
relying on the Trust's forward-looking statements or information,
investors and others should carefully consider the foregoing
factors and other uncertainties and potential events. Except as
required by law, the Trust undertakes no obligation to publicly
update or revise any forward-looking statements or information,
whether written or oral, that may be as a result of new
information, future events or otherwise.
About Brookfield Canada Office Properties
Brookfield Canada Office Properties is Canada's preeminent Real
Estate Investment Trust (REIT). Its portfolio is comprised of
interests in 28 premier office properties totaling 20.7 million
square feet in the downtown cores of Toronto, Calgary, Ottawa and
Vancouver. Landmark assets include Brookfield Place in Toronto and
Bankers Hall in Calgary. For more information, visit
www.brookfieldcanadareit.com.
Contact: Matthew Cherry Director, Investor Relations and
Communications (416) 359-8593 Email Contact
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