Cominar Real Estate Investment Trust Trust Units CMLEF

We will vote against stealing of our shares

[incomedreamer11]

1.  The circular asserts that the public Real Estate Investment Trust (REIT) structure is suboptimal for Cominar.
   • We disagree and believe REITs allow investors to gain exposure to the real estate sector via a liquid and tax efficient structure. Forty countries have enacted REIT legislation, 528 listed real estate companies are included in the FTSE EPRA/Nareit Global Real Estate Index, comprising $2 trillion of total market capitalization.1 The Canadian S&P / TSX Composite Index counts 22 public REITs among its constituents with a total market capitalization of $67 billion.2
      
2. The circular asserts that diversified REITS trade at a discount in public markets.
   • Since the current proposal seeks to take Cominar private and dispose of the assets, no such discount should be reflected in the offer price.
      
3. The circular asserts that Cominar has a capital structure that employs high leverage and limited liquidity.
   • Cominar's leverage of 55% and Debt/EBITDA Ratio of 10.5x are well within the range of comparable peers.
   • Liquidity is adequate with interest coverage ratio of 2.5x, $341 million available in cash and unused credit facilities and $1.7 billion in unencumbered assets.
      
4. The circular asserts considerable capex requirements to maintain growth of office and retail segments.
   • Cominar has identified intensification opportunities including a potential of close to 10,000 residential units on its existing properties. Value can be derived from a combination of selling air rights, partnerships or standalone development.
   • Approximately one third of Cominar's properties are located near new mass transit projects such as the REM and Tramway. The Company stands to benefit directly from these major infrastructure projects.
      
5. Independent valuation and fairness opinions
   • The independent valuation and fairness opinion prepared by Desjardins Securities Inc. presents unreasonable assumptions including punitive capitalization rates, 'comparable' transactions dating back to 2006 and applies a discount to Cominar's reported net asset value in the range of 20% to 30% while showing 'comparable' transactions being executed at an average premium of 18%.
      
6. Fair treatment of other stakeholders
   • Throughout the strategic review process that lasted 13 months, there was little to no communication with shareholders regarding the progress of this review. The ensuing proposal lacks critical information for shareholders to fully evaluate the offer.
   • Despite requests from shareholders and analysts, the Company has not disclosed the price that Blackstone is paying for Cominar's industrial assets nor the price that the buying Consortium is paying for their share of the assets.
   • The CEO of Cominar is set to receive $11.6 million, including a $5.2 million termination fee should the proposal go through.
   • Suspending distributions for the remainder of 2021 is not in the best interest of shareholders and has a negative impact on value.

The timing of this proposal appears to be ill-conceived as Cominar is still in the early stages of emerging from the global covid-19 pandemic that has kept malls and offices closed over extended periods of time in 2020 and 2021. Cominar's share price saw a steep decline from pre-pandemic levels and has yet to fully recover.