TORONTO--(BUSINESS WIRE)--Agellan Commercial Real Estate Investment Trust (TSX: ACR.UN):
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISTRIBUTION IN THE UNITED STATES
Agellan Commercial Real Estate Investment Trust (the “REIT”) (TSX: ACR.UN) announced today the closing of its previously announced disposition of the REIT’s approximate 824,000 square foot office property and approximate 42,000 square foot retail space and parking garage located on Consumers Road in Toronto, Ontario (“Parkway Place”) to a third-party purchaser.
The sale price for Parkway Place was approximately $256.3 million (excluding closing costs) subject to certain adjustments in respect of, among other things, certain committed leasing costs. In addition, in conjunction with the sale of Parkway Place, the REIT has entered into a two-year vendor head lease with the purchaser in respect of certain vacant retail space at Parkway Place. The REIT’s financial obligation under the vendor head lease is approximately $2.8 million.
The REIT expects to use the sale proceeds (i) to repay all outstanding amounts owing under the REIT’s credit facility secured by Parkway Place, (ii) to acquire industrial assets located in the REIT’s target markets in the United States, (iii) to repay certain other outstanding debt of the REIT, (iv) to fund the cash portion of an anticipated special distribution to unitholders of the REIT during 2018, and (v) for general business and working capital purposes.
About Agellan Commercial Real Estate Investment Trust
The REIT is an unincorporated, open-ended real estate investment trust established pursuant to a declaration of trust under the laws of the Province of Ontario. The REIT has been created for the purpose of acquiring and owning industrial, office and retail properties in select target markets in the United States and Canada.
The REIT’s 45 properties contain 6.5 million square feet of gross leasable area, with the REIT’s ownership interest at 6.1 million square feet. The properties are located in major urban markets in the United States and Canada.
This press release contains forward-looking information within the meaning of applicable securities legislation, which reflects the REIT’s current expectations regarding future events. Forward-looking statements include, but are not limited to, statements concerning: (i) the intended use of proceeds from the disposition of Parkway Place, including the potential special distribution; (ii) the REIT’s future financial obligation under the vendor head lease; and (iii) the REIT’s current investment strategy. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the REIT’s control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. These forward-looking statements are made as of the date of this press release and, except as expressly required by applicable law, the REIT assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.