/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES/
TORONTO, Dec. 11, 2018 /CNW/ - (TSX:CAR.UN) – Canadian
Apartment Properties Real Estate Investment Trust ("CAPREIT") of
Toronto, Ontario announced today
that it has agreed to sell, subject to regulatory
approval, 5,500,000 units at a price of $45.50 per unit for aggregate gross proceeds
of $250,250,000 (the "Offering") to a
syndicate of underwriters led by RBC Capital Markets on a
bought-deal basis. CAPREIT has granted the underwriters an
over-allotment option (the "Over-Allotment Option"), exercisable in
whole or in part up to 30 days after closing of the Offering, to
purchase up to an additional 825,000 units to cover
over-allotments, if any.
CAPREIT will, within the next few days, file with the securities
commissions and other similar regulatory authorities in each of the
provinces and territories of Canada, a preliminary short form prospectus
relating to the issuance of the units. Closing of the Offering is
expected to take place on or about January
4, 2019.
CAPREIT intends to use the net proceeds of the
Offering:
i.
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first to partially
repay the approximately $570 million currently drawn on CAPREIT's
acquisition and operating facility in the amount of approximately
$239 million, which was utilized by CAPREIT to, among other uses,
partially fund previous acquisitions; and
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ii.
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the remainder, if
any, for future acquisitions, capital expenditures and for general
trust purposes.
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Upon closing of the Offering, and excluding the effect of the
Over-Allotment Option, the partial repayment of approximately
$239 million of the currently drawn
acquisition and operating facility with the net proceeds of the
Offering will reduce CAPREIT's total debt to gross book value ratio
to 39.9% from 42.2%, as at September 30,
2018, adjusted to include the approximately $347 million of Netherlands acquisitions CAPREIT closed in
December. CAPREIT's acquisition capacity is expected to be
approximately $880 million, based on
the remaining liquidity available under the acquisition and
operating facility, and assuming 65% loan-to-value mortgage
financing.
Mark Kenney, President &
Chief Operating Officer of CAPREIT, added, "CAPREIT has a strong
pipeline of potential Canadian acquisitions, some of which are in
the advanced stages of negotiation. This equity offering will
provide CAPREIT with additional financing capacity to capitalize on
these exciting opportunities, while lowering CAPREIT's already
conservative leverage metrics. Since our last equity offering in
February 2018, we've grown our
portfolio through the acquisition of 1,755 suites and sites, at an
aggregate acquisition cost of approximately $482 million, and we look forward to continuing
to grow the portfolio."
CAPREIT intends to make monthly cash distributions to
unitholders of record on each record date, on or about the 15th day
of the month following the record date. CAPREIT's current monthly
cash distribution is $0.11083 per
unit ($1.33 annually). The first cash
distribution to which purchasers of the units under this Offering
will be entitled to participate will be for the month of January,
with a record date of January 31,
2019 and a payment date of February
15, 2019.
This press release shall not constitute an offer to sell, or the
solicitation of an offer to buy, any securities in any jurisdiction
in which such offer, solicitation or sale would be unlawful. The
securities being offered have not been and will not be registered
under the U.S. Securities Act of 1933 as amended and may not be
offered or sold in the United
States absent registration or pursuant to applicable
exemption from registration.
ABOUT CAPREIT
As one of Canada's largest residential landlords,
CAPREIT is a growth-oriented investment trust owning interests in
51,743 residential units, comprised of 45,151 residential suites
and 32 manufactured home communities comprising 6,592 land lease
sites, located in and near major urban centres across Canada and The Netherlands. Since its
Initial Public Offering in May 1997,
CAPREIT has grown monthly cash distributions per Unit by 86%.
For more information about CAPREIT, its business and its investment
highlights, please refer to our website at www.caprent.com or
www.capreit.net and our public disclosure, which can be found under
our profile at www.sedar.com.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING
STATEMENTS
All statements in this press release that do not
relate to historical facts constitute forward-looking statements.
These statements represent CAPREIT's intentions, plans,
expectations and beliefs and are subject to certain risks and
uncertainties that could result in actual results differing
materially from these forward-looking statements. These risks and
uncertainties are more fully described in regulatory filings that
can be obtained on SEDAR at www.sedar.com.
SOURCE Canadian Apartment Properties Real Estate Investment
Trust (CAPREIT)