to Acquire 16 Industrial Assets for an Aggregete $163.2 M NOT FOR DISSEMINATION IN THE UNITED STATES OR DISTRIBUTION THROUGH UNITED STATES NEWS OR WIRE SERVICES.
- Acquisition of 16 institutional quality industrial assets comprising total GLA of 1,181,006 square feet
- PROREIT portfolio to increase to 6.6 million square feet of GLA and approximately $928 million of total assets, pro forma the Transactions
- Increased exposure to industrial segment, representing 78% of GLA and 63% of base rent pro forma the Transactions
- Transactions accretive to AFFO/unit* and expected to reduce AFFO payout ratio* on a leverage neutral basis
- Enhanced liquidity through significant pay down of credit facilities
MONTREAL, Sept. 27, 2021 (GLOBE NEWSWIRE) -- PRO Real Estate Investment Trust (TSX: PRV.UN) ("PROREIT" or the "REIT") today announced that it has entered into agreements to acquire a 100% interest in 15 industrial properties located in Atlantic Canada representing 1,074,269 square feet of gross leasable area ("GLA") and one industrial property in Winnipeg, Manitoba representing 106,737 square feet of GLA (collectively, the “Acquisitions”) for an aggregate purchase price of $163.2 million (excluding closing costs), representing an implied weighted average capitalization rate of 5.9% and approximately $138 per square foot.
"The acquisitions of these high-quality institutional assets represent a strategic transaction for the REIT and provide AFFO accretion. The assets offer significant growth potential and substantially increase PROREIT's exposure to the industrial sector across key markets. The acquisitions also demonstrate the REIT’s continued success and ability to source and acquire assets in the highly competitive industrial segment where we are focused,” said James Beckerleg, CEO.
"We are also very pleased with continued commitment from an institutional investor of the caliber of the Bragg Group of Companies through the private placement. We are excited to continue to grow with this strong partner at our side," added James Beckerleg.
Public Offering and Concurrent Private Placement
The REIT also announced today that it has entered into an agreement to issue 8,760,000 trust units of the REIT (“Units”) from treasury on a bought deal basis at a price of $6.85 per unit (the “Offering Price”) to a syndicate of underwriters with TD Securities Inc. and Scotiabank acting as bookrunners and co-led by Canaccord Genuity Corp. (collectively, the “Underwriters”) for gross proceeds of approximately $60 million (the “Offering”). The REIT has granted the Underwriters an over-allotment option to purchase up to an additional 1,314,000 Units on the same terms and conditions, exercisable at any time, in whole or in part, up to 30 days after the closing of the Offering (the “Over-Allotment Option”). The Offering is expected to close on or about October 6, 2021 and is subject to customary conditions, including regulatory approval. The Units will be offered by way of a prospectus supplement to the REIT's base shelf prospectus dated July 13, 2021, to be filed with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada, pursuant to National Instrument 44-102 – Shelf Distributions (the "Prospectus Supplement").
PROREIT also entered into a concurrent binding subscription agreement to issue approximately $14 million of Units on a non-brokered private placement basis at the Offering Price to Collingwood Investments Incorporated, a member of the Bragg Group of Companies, from Nova Scotia (the "Private Placement"). Upon closing of the Private Placement, Collingwood Investments Incorporated, will maintain its voting and economic interest of approximately 19.23% in PROREIT, or approximately 19.5% together with one of its related parties. Collingwood Investments Incorporated will be entitled at closing of the Private Placement to a capital commitment fee equal to 2% of the gross proceeds of the Private Placement.
The Private Placement is subject to customary conditions, including regulatory approval. Closing of the Offering is conditional upon the concurrent closing of the Private Placement, and closing of the Private Placement is conditional upon the concurrent closing of the Offering.
The REIT intends to use the net proceeds from the Offering and the Private Placement (collectively, with the Acquisitions and the Sale Transaction (as defined below), the "Transactions") to partially fund the Acquisitions, to repay certain indebtedness which may be subsequently redrawn, and the balance if any to fund future acquisitions and for general business and working capital purposes.
https://www.globenewswire.com/news-release/2021/09/27/2303939/0/en/PROREIT-Announces-Agreements-to-Acquire-16-Industrial-Assets-for-an-Aggregate-Purchase-Price-of-163-2-Million-60-Million-Bought-Deal-Public-Offering-of-Trust-Units-and-14-Million-C.html