Granite Real Estate Investment Trust (“Granite” or the “REIT”)
(TSX: GRT.UN / NYSE: GRP.U) announced today that it has agreed to
acquire eight income-producing properties in the United States
comprising approximately 4.0 million square feet (“SF”) at a
combined purchase price of approximately C$332 million (US$246.1
million) (the “Acquisitions”). The Acquisitions represent an
in-going weighted average yield of approximately 5.5% and are fully
leased with a weighted average lease term of 5.1 years to a diverse
range of strong tenants.
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5415 Centerpoint Pkwy, Obetz, OH (Photo:
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Kevan Gorrie, Granite’s President and CEO, commented that,
“These acquisitions outlined herein advance our strategy of
acquiring and developing modern e-commerce and distribution
facilities in Granite’s U.S. target markets. The properties are
exceptionally well located in their respective markets, with close
proximity to critical e-commerce infrastructure. Furthermore, the
assets are being acquired at a competitive cost basis and provide
an opportunity to enhance returns as several leases in the
portfolio include below market in-place rents. Following the
Acquisitions, the net proceeds from our recent equity offering and
green bond offering enable us to maintain our strong balance sheet
position with estimated pro forma liquidity of approximately C$1.1
billion.”
Midwest Portfolio
Columbus (962K
SF)
Cincinnati (825K
SF)
Indianapolis (622K
SF)
5415 Centerpoint Parkway, Obetz, OH
6201 Green Pointe Drive South, Groveport,
OH
8779 Le Saint Drive, Hamilton, OH
8754 Trade Port Drive, West Chester,
OH
445 Airtech Parkway, Indianapolis, IN
Granite has agreed to acquire five modern distribution
warehouses located in the Midwest markets of Cincinnati, Columbus,
and Indianapolis, collectively totaling 2.4 million SF. The
properties are 100% leased to six tenants for a weighted average
remaining lease term of 4.6 years. These institutional quality
assets have minimum 32’ clear heights with an average age of 10
years.
The properties are located in established business parks with
close proximity to extensive highway and major air/rail systems,
and benefit from the availability of labor and access to a more
than fifty percent of the U.S. population within a one-day drive.
Two of the properties are located in Cincinnati’s largest
industrial submarket, Tri County, with close proximity to
Cincinnati/Northern Kentucky International Airport (“CVG”). The
fastest growing cargo airport in the U.S., CVG serves as DHL’s
North American hub and is home to Amazon’s US$1.5 billion Prime Air
Hub. The two Columbus properties are located in the preferred
southeast Rickenbacker submarket, adjacent to Rickenbacker
International Airport, one of the world’s only cargo-dedicated
airports. The Indianapolis property, situated in the Plainfield
submarket, the most sought after in the region, is located within 3
miles from the Indianapolis International Airport and the FedEx Air
Hub, the second largest FedEx Hub in the world.
Memphis Portfolio
4460 E. Holmes Road, Memphis, TN
4995 Citation Drive, Memphis, TN
8650 Commerce Drive, Southaven, MS
Granite has agreed to acquire three modern distribution
warehouses located in the Memphis market totaling 1.6 million SF
which are 100% leased to five tenants for a weighted average
remaining lease term of 6.2 years. These highly functional assets
have 32’ clear heights, cross dock capabilities and flexible design
characteristics.
The three properties are strategically located near major
e-commerce distribution infrastructure, including the Memphis
International Airport, the world’s busiest cargo airport, FedEx
World Hub, which is currently undergoing a multi-billion expansion,
UPS Airport Facility and the BNSF Memphis Intermodal Facility. 8650
Commerce Drive is located in the DeSoto Industrial Submarket, less
than 15 miles from downtown Memphis, and the remaining two
properties are located in the Southeast Industrial Submarket, the
largest in Memphis. The Memphis industrial market has been
experiencing robust occupancy levels and benefits from proximity to
greater than fifty percent of the U.S. population within a one-day
drive.
The Acquisitions are subject to customary closing conditions and
are expected to close in the second quarter of 2020. Granite
expects to fund the Acquisitions using a combination of net
proceeds from its recent equity offering and cash on hand.
ABOUT GRANITE Granite is a Canadian-based REIT engaged in
the acquisition, development, ownership and management of
logistics, warehouse and industrial properties in North America and
Europe. Granite owns over 90 investment properties representing
approximately 40.3million square feet of leasable area.
OTHER INFORMATION Copies of financial data and other
publicly filed documents about Granite are available through the
internet on the Canadian Securities Administrators’ System for
Electronic Document Analysis and Retrieval (SEDAR) which can be
accessed at www.sedar.com and on the United States Securities and
Exchange Commission’s Electronic Data Gathering, Analysis and
Retrieval System (EDGAR) which can be accessed at www.sec.gov.
For further information, please see our website at
www.granitereit.com or contact Teresa Neto, Chief Financial
Officer, at 647-925-7560 or Andrea Sanelli, Manager, Legal &
Investor Services, at 647-925-7504.
FORWARD LOOKING STATEMENTS This press release may contain
statements that, to the extent they are not recitations of
historical fact, constitute “forward-looking statements” or
“forward-looking information” within the meaning of applicable
securities legislation, including the United States Securities Act
of 1933, as amended, the United States Securities Exchange Act of
1934, as amended, and applicable Canadian securities legislation.
Forward-looking statements and forward-looking information may
include, among others, statements regarding the closing of the
Acquisitions, Granite’s ability to enhance returns on the assets
and Granite’s plans, goals, strategies, intentions, beliefs,
estimates, costs, objectives, economic performance, expectations,
or foresight or the assumptions underlying any of the foregoing.
Words such as “may”, “would”, “could”, “will”, “likely”, “expect”,
“anticipate”, “believe”, “intend”, “plan”, “forecast”, “project”,
“estimate”, “seek”, “objective” and similar expressions are used to
identify forward-looking statements and forward-looking
information. Forward-looking statements and forward-looking
information should not be read as guarantees of the closing of the
Acquisitions, Granite’s ability to enhance returns on the assets or
other events, performance or results and will not necessarily be
accurate indications of whether or the times at or by which such
closing of the Acquisitions or other events or performance will be
achieved. Undue reliance should not be placed on such statements.
Forward-looking statements and forward-looking information are
based on information available at the time and/or management’s good
faith assumptions and analyses made in light of its perception of
historical trends, current conditions and expected future
developments, as well as other factors management believes are
appropriate in the circumstances, and are subject to known and
unknown risks, uncertainties and other unpredictable factors, many
of which are beyond Granite’s control, that could cause actual
events or results to differ materially from such forward-looking
statements and forward-looking information. Important factors that
could cause such differences include, but are not limited to, the
risks set forth in the annual information form of Granite Real
Estate Investment Trust and Granite REIT Inc. dated March 4, 2020
(the “Annual Information Form”) and management discussion and
analysis of results of operations and financial position for the
three months ended March 31, 2020 (the “Q1 MD&A). The “Risk
Factors” section of the Annual Information Form and the Q1 MD&A
also contain information about the material factors or assumptions
underlying such forward-looking statements and forward-looking
information. Forward-looking statements and forward-looking
information speak only as of the date the statements and
information were made and unless otherwise required by applicable
securities laws, Granite expressly disclaims any intention and
undertakes no obligation to update or revise any forward-looking
statements or forward-looking information contained in this press
release to reflect subsequent information, events or circumstances
or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20200609005394/en/
Teresa Neto Chief Financial Officer 647-925-7560
Andrea Sanelli Manager, Legal & Investor Services
647-925-7504.
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