RE:RE:RE:$11.75 takeout Oct. 24, 2021 /CNW/ - Artis Real Estate Investment Trust ("Artis" or the "REIT") (TSX: AX.UN) announced today that a consortium led by Canderel Real Estate Property Inc. and including Artis, partnerships managed by the Sandpiper Group, and FrontFour Capital Group LLC (the "Consortium") has, through a newly-formed entity, entered into an arrangement agreement to acquire Cominar Real Estate Investment Trust ("Cominar"), with Cominar unitholders, other than certain Cominar unitholders that are members of the Consortium, receiving consideration of $11.75 in cash per unit, (the "Transaction"). The Consortium intends to retain portions of Cominar's retail portfolio, as well as components of Cominar's office portfolio, and has entered into agreements to sell Cominar's industrial portfolio to Blackstone and a portfolio comprised of certain of Cominar's retail and office assets to the Group Mach. Koch Real Estate Investments, LLC, and Artis will also be providing preferred equity for the Transaction.
The Transaction, which is expected to close in the first quarter of 2022, has been recommended by both the Board of Trustees of Cominar and its Special Committee and remains subject to the approval of Cominar unitholders, court and required regulatory approvals and customary closing conditions.
Artis has committed a total of up to $214 million to the Transaction, which includes participation in multiple aspects of the Consortium's overall capital structure, including $100 million of junior preferred units that carry a distribution rate of 18% per annum and up to $114 million in common equity units.
"This transaction is an important step in implementing the next phase of our new vision and strategy," said Samir Manji, President and Chief Executive Officer of Artis. "We're pleased to collaborate with this group of experienced real estate investors in an opportunity that aligns with our long-term objectives and that we anticipate will generate strong annual returns on our overall capital commitments. This initiative also reflects the nature of opportunities and investments that we look forward to pursuing in the future with other potential investors and partners."
Ben Rodney, Chair of the Board of Trustees of Artis, added "Our Business Transformation Plan, announced just seven months ago, is working. On the heels of unlocking over $700 million on the sale of Artis' GTA industrial portfolio, our management team, working with Sandpiper Group, has identified opportunities that can compound unitholder returns through this multi-tiered and accretive investment strategy."
On March 10, 2021, Artis announced a new vision and strategy for the REIT – to build a best-in-class asset management and investment platform focused on growing net asset value per unit and distributions for investors through debt repayment, return of capital and value investing in real estate. As part of this strategy, Artis committed to deploying capital into strategic investments in portfolio companies and concentrating its ownership in the highest and best return opportunities in an effort to maximize long-term value for unitholders.