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QUEBEC CITY,
May 22, 2013 /CNW Telbec/ - Cominar
Real Estate Investment Trust ("Cominar") (TSX: CUF.UN)
announced today that it has sold its interest in Dyne Holdings
Limited ("Dyne") to Homburg International Limited. Dyne was
an indirect subsidiary of Canmarc Real Estate Investment Trust
("Canmarc"), acquired by Cominar in 2012. The sale was
completed for nominal consideration and the reimbursement of
certain shareholder advances. This transaction will allow Cominar
to remove Dyne's liabilities from its balance sheet.
Dyne's assets include the Holman Grand Hotel
(the "Hotel"), an 80 room boutique style hotel located in
Charlottetown, Prince Edward
Island. Dyne is indebted to the Prince Edward Island Century
2000 Fund Inc. (the "Century Fund") under a secured loan in
the amount of $14.7 million
contracted by Dyne in November 2008
to finance the construction of the Hotel (the "Hotel Loan").
The Hotel Loan was guaranteed by Homburg Invest Inc.
("HII"). The Hotel was acquired from Dyne by HII in April of
2010, while it was still under construction. The Hotel Loan was
thereafter assumed by HII, which agreed to indemnify Dyne in
connection with same. However, Dyne was never released from its
obligations under the Hotel Loan, and remained liable for the debt.
Dyne's assets also include certain other commercial properties
known as the Confederation Court Complex (160,000 square feet)
including The National Bank Tower, BDC Place (64,000 square feet)
and The Homburg Financial Tower (34,000 square feet) located in
Charlottetown, Prince Edward
Island which have been given as security for other
borrowings of Dyne aggregating $17.9
million.
HII filed for protection under the Companies'
Creditors Arrangement Act (the "CCAA") on September 9, 2011. On November 30, 2012, HII terminated the ground
lease entered into in connection with the Hotel and the ownership
of the Hotel reverted to Dyne. The Hotel is presently closed.
In addition to the Hotel Loan, various claims
are being asserted in connection with the construction of the
Hotel, including against Dyne. Construction-related trade payables
alleged to be secured by liens on the Hotel total approximately
$4.1 million.
Losses with respect to Dyne's investment were
previously accounted for in Cominar.
Mr. Michel
Dallaire, Cominar's President and Chief Executive Officer,
said: "We are pleased with this outcome and wish the best for the
Homburg International Group and the Charlottetown community."
PROFILE as at May 22,
2013
Cominar is the third largest diversified real
estate investment trust in Canada
and currently remains the largest commercial property owner in the
Province of Québec. Cominar owns a real estate portfolio of 498
high-quality properties, consisting of 121 office, 156 retail and
221 industrial and mixed-use buildings with a leasable area of
approximately 36.8 million square feet spread out across Québec,
Ontario, the Atlantic Provinces
and Western Canada. Cominar's
objectives are to pay growing cash distributions to unitholders and
to maximize unitholder value by way of integrated, proactive
management and the expansion of its portfolio.
Forward-Looking Statements
This press release may contain forward-looking
statements with respect to Cominar and its operations, strategy,
financial performance and financial condition. These statements
generally can be identified by the use of forward-looking words
such as "may", "will", "expect", "estimate", "anticipate",
"intend", "believe" or "continue" or the negative thereof or
similar variations. The actual results and performance of Cominar
discussed herein could differ materially from those expressed or
implied by such statements. Such statements are qualified in their
entirety by the inherent risks and uncertainties surrounding future
expectations. Some important factors that could cause actual
results to differ materially from expectations include, among other
things, general economic and market factors, competition, changes
in government regulation and the factors described under "Risk
Factors" in the Annual Information Form of Cominar. The cautionary
statements qualify all forward-looking statements attributable to
Cominar and persons acting on its behalf. Unless otherwise stated,
all forward-looking statements speak only as of the date of this
press release.
SOURCE COMINAR REAL ESTATE INVESTMENT TRUST