MEXICO CITY--(BUSINESS WIRE)--Macquarie Mexican REIT (MMREIT) (BMV:FIBRAMQ) today provided an update on its transition to an internal property administration platform.
“MMREIT has made significant progress in the establishment of an internal property administration platform,” said Jaime Lara, Chief Executive Officer of Macquarie Mexican REIT. “This is an important milestone in the development of our FIBRA as it will enable us to better serve our customers and better leverage our service provider relationships to reduce costs.”
MMREIT also announced today that it has brought forward the expiry date of its transitional property administration agreement with GE Capital Real Estate Mexico (GECREM) to December 31, 2013, a year earlier than provided under the original agreement. Certain transitional accounting and related services will continue into 1Q13. MMREIT’s other property administration arrangements with Corporate Properties of the Americas (CPA) will also terminate in December 2013.
“Given the progress we’ve made with our internal platform, we have decided to transition from the external arrangement with GECREM at the end of the year,” added Lara. “We are grateful for the strong partnership we’ve had with GE’s property administration arm and thank them for their support.”
MMREIT has agreed to pay GECREM US$9 million to discharge in full GECREM’s earn-out entitlement under the terms of the December 2012 industrial portfolio acquisition. The payment will be made in five equal quarterly installments through March 31, 2015. The original acquisition terms provided for a maximum earn-out of approximately US$18 million, payable incrementally upon reaching certain occupancy hurdles as well as upon early termination of GECREM’s property administration agreement.
The US$9 million payout is equivalent to MMREIT's conservative base case for occupancy and is expected to have the potential for upside. “The termination of our contract with GECREM in December will ease the transition of our properties currently administered by CPA in a cost efficient manner,” continued Lara. “We believe that being closer to our tenants, earlier than anticipated, will help us to facilitate our upside occupancy scenario.”
About Macquarie Mexican REIT
Macquarie Mexican REIT (MMREIT) (BMV:FIBRAMQ) is a real estate investment trust (fideicomiso de inversíon en bienes raices), or FIBRA, listed on the Mexican Stock Exchange (Bolsa Mexicana de Valores) targeting industrial, retail and office real estate opportunities in Mexico, with a primary focus on stabilized income-producing properties. MMREIT’s portfolio consists of 244 industrial properties located in 21 cities across 15 Mexican states (as of June 30, 2013). For additional information about MMREIT, please visit www.macquarie.com/mmreit.
About Macquarie Group
Macquarie Group (Macquarie) is a global provider of banking, financial, advisory, investment and funds management services. Macquarie’s main business focus is making returns by providing a diversified range of services to clients. Macquarie acts on behalf of institutional, corporate and retail clients and counterparties around the world. Founded in 1969, Macquarie operates in more than 70 office locations in 28 countries. Macquarie employs approximately 13,660 people and has assets under management of over US$362 billion (as of March 31, 2013).
Macquarie Infrastructure and Real Assets, a division of Macquarie, is a leading global alternative asset manager specializing in investments across infrastructure, real estate, agriculture and energy. Macquarie Infrastructure and Real Assets manages 49 funds with US$101 billion of assets under management across 25 countries (as of March 31, 2013).
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