CAPREIT Announces Strategic Capital Recycling in Ottawa
28 February 2023 - 9:00AM
Canadian Apartment Properties Real Estate Investment Trust
(“CAPREIT”) (TSX:CAR.UN) announced today that it has completed the
acquisition of an on-strategy, newly-built property located in a
major suburb of Ottawa. The amenity-rich property, which contains
143 residential suites that are approximately 95% occupied, is
located in close proximity to another newly-built property that
CAPREIT purchased in 2022, providing economies of scale. CAPREIT
acquired the high-quality asset for a purchase price of $61 million
(excluding transaction costs), which was satisfied by the following
sources of capital: $16 million in cash, $42 million from the
assumption of an existing mortgage, and $3 million from a Vendor
Take-Back (“VTB”) loan. Repayment of the five-year interest-free
VTB may be waived, subject to certain conditions. The mortgage
being assumed carries contractual interest of 3.25% per annum for a
remaining ten-year term to maturity.
A Media Snippet accompanying this announcement
is available by clicking on the image or link below:
“This beautiful new asset is well-built and
well-located in a thriving neighbourhood that has strong
fundamentals, perfectly in line with our asset re-positioning
strategy,” commented Mark Kenney, President and CEO. “In addition
to improving the quality of our portfolio, we are assuming a
below-market, long duration mortgage that adds incremental value
and liquidity available to continue securing strategic
returns.”
“Following our successful disposition of three
older, value-add assets in Ottawa last month, we paid down higher
interest debt and are now re-allocating capital back into Ottawa
through this new-build property that has both a strong growth
profile and low capital expenditure needs,” added Julian
Schonfeldt, Chief Investment Officer. “We sold at a capitalization
rate in the mid 3% range and are re-investing at a capitalization
rate that is in excess of 4%, at a price that is below replacement
cost, creating value for our Unitholders.”
ABOUT CAPREITCAPREIT is
Canada’s largest publicly traded provider of quality rental
housing. As at December 31, 2022, CAPREIT owns or has interests in
approximately 67,000 residential apartment suites, townhomes and
manufactured home community sites well-located across Canada and
the Netherlands, with approximately $17 billion of investment
properties in Canada and Europe. For more information about
CAPREIT, its business and its investment highlights, please visit
our website at www.capreit.ca and our public disclosure which can
be found under our profile at www.sedar.com.
CAUTIONARY STATEMENTS REGARDING
FORWARD-LOOKING STATEMENTSAll 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.
For more information, please
contact:
CAPREIT |
CAPREIT |
CAPREIT |
Mr. Mark Kenney |
Mr. Stephen Co |
Mr. Julian Schonfeldt |
President & Chief Executive Officer |
Chief Financial Officer |
Chief Investment Officer |
(416) 861-9404 |
(416) 306-3009 |
(647) 535-2544 |
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