"Strategic Rail Initiative Continues"
/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES./
VANCOUVER, Aug. 11, 2015 /CNW/ - American Hotel Income Properties REIT
LP ("AHIP") (TSX: HOT.UN; OTCQX: AHOTF) announced today the closing of its
previously announced public offering (the "Offering") of 3,800,000 limited partnership units (each a "Unit"), on a bought deal basis, at a price of Cdn$10.15 per Unit, for total
gross proceeds of Cdn$38,570,000. The Offering is fully described in
AHIP's short form prospectus dated August 5, 2015 (the "Prospectus"), which is available on SEDAR at www.sedar.com.
The Offering was conducted through a syndicate of underwriters co-led by
Canaccord Genuity Corp. and National Bank Financial Inc., and including
CIBC, RBC Capital Markets, Scotiabank, TD Securities Inc., Haywood
Securities Inc., Dundee Securities Ltd. and Industrial Alliance
Securities Inc. AHIP has granted to the underwriters an over-allotment
option to purchase up to an additional 570,000 Units which option may
be exercised in whole or in part at any time for a period of up to 30
days.
As described in the Prospectus, AHIP intends to use the net proceeds of
the Offering to: (i) partially fund the potential acquisition of a
strategic portfolio of five railway lodging facilities (the "Railway Portfolio") that is currently under preliminary review and subject to various
conditions; (ii) partially fund potential expansion, conversion and
new-build opportunities for railway lodging facilities (collectively,
the "Additional Railway Hotels"); and (iii) as to the balance, if any, to fund working capital and for
general corporate purposes.
Rob O'Neill, AHIP's CEO stated, "I am pleased to report that upon
completion of the acquisition of the Railway Portfolio and other
rail-related transactions that are in the pipeline, we will have seven
additional rail properties with significant railway occupancy
guarantees and two expanded Oak Tree Inn hotels. These transactions
reinforce our commitment to continue with our strategic rail initiative
for more high-occupancy, steady railway hotels in our portfolio."
The Units sold pursuant to the Offering have been listed on the Toronto
Stock Exchange under AHIP's existing trading symbol HOT.UN. AHIP now
has 34,383,740 Units issued and outstanding.
These securities have not been, and will not be, registered under the
United States Securities Act of 1933, as amended, and may not be
offered or sold in the United States absent registration or an
applicable exemption from the registration requirements of such Act.
This news release does not constitute an offer for sale of these
securities in the United States.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking information within the
meaning of applicable securities legislation, which reflects AHIP's
current expectations regarding future events. Forward-looking
information is identified by the use of terms and phrases such as
"anticipate", "believe", "budget", "could", "estimate", "expect",
"going-in", "intend", "may", "opportunities", "plan", "potential",
"predict", "project", "will", "would" and similar terms and phrases,
including references to assumptions. Such information includes, but is
not limited to: the use of proceeds from the Offering, including,
without limitation, to partially fund the potential acquisition of each
of the Railway Portfolio and the expansion of potential conversion,
expansion and new-build opportunities for the Additional Railway
Hotels; and AHIP's intention to continue with its strategic rail
initiative for more high-occupancy, steady railway hotels in its
portfolio. Actual events or results may differ materially.
Forward-looking information contained in this news release is based on
certain key expectations and assumptions made by AHIP, including,
without limitation those with respect to: the acquisition, expansion,
conversion, opening and successful integration, as applicable, of the
Railway Portfolio and the Additional Railway Hotels; capitalization
rates; fees and reserves; targeted completion dates; pro forma
leverage; and payout ratios. Although the forward-looking information
contained in this news release is based upon what AHIP's management
believes to be reasonable assumptions, AHIP cannot assure investors
that actual events or results will be consistent with such information.
Forward-looking information reflects current expectations of management
regarding future events and operating performance as of the date of
this news release. Such information involves significant risks and
uncertainties, should not be read as guarantees of future performance
or results, and will not necessarily be accurate indications of whether
or not such results will be achieved. A number of factors could cause
actual results to differ materially from the results discussed in the
forward-looking information, and a description of these factors can be
found under "Risk Factors" in AHIP's Annual Information Form dated
March 27, 2015 and under "Risks and Uncertainties" in AHIP's
Management's Discussion and Analysis dated May 13, 2015, both of which
are available on SEDAR at www.sedar.com.
The forward-looking information contained herein is expressly qualified
in its entirety by this cautionary statement. The forward-looking
information is made as of the date of this news release and AHIP
assumes no obligation to update or revise such information to reflect
new events or circumstances, except as may be required by applicable
law.
The potential acquisitions, expansions and conversions described in this
news release are indicative only, as these potential transactions are
being evaluated and negotiated with the applicable sellers. In
addition, each transaction, if it proceeds, would be subject to
conditions, including satisfactory completion of AHIP's due diligence
and negotiation or assignment of railway contracts, as applicable, and
negotiation of formal legal documents. For example, AHIP cautions that
there can be no assurance that any such transaction will complete, or
what the terms of such a transaction, if any, may be. AHIP undertakes
no obligation to update investors on the status of any potential
transactions described in this news release unless and until all key
conditions are satisfied and the Board of Directors of AHIP's general
partner has approved the transaction, in each case.
About American Hotel Income Properties REIT LP
AHIP is a limited partnership formed under the Limited Partnerships Act (Ontario) to invest in hotel real estate properties located
substantially in the United States and is engaged primarily in the
railroad employee accommodation, transportation-oriented, and
select-service lodging sectors. AHIP's properties are mostly located in
secondary and tertiary markets in the United States in close proximity
to railroads, airports, highway interchanges, and other demand
generators. AHIP currently owns 73 hotels including 38 hotels serving
the U.S. rail industry pursuant to long-term railway contracts and 35
hotels affiliated with leading national and international hotel brands.
AHIP's long-term objectives are to: (i) generate stable and growing
cash distributions from hotel properties substantially in the U.S.;
(ii) enhance the value of its assets and maximize the long-term value
of the hotel properties through active management; and (iii) expand its
asset base and increase its AFFO per unit through an accretive
acquisition program, participation in strategic development
opportunities and improvements to its properties through targeted
value-added capital expenditure programs.
Additional Information
Additional information relating to AHIP, including its other public
filings, is available on SEDAR at www.sedar.com and on AHIP's website at www.ahipreit.com.
THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
RESPONSIBILITY FOR THE ADEQUACY OR THE ACCURACY OF THIS NEWS RELEASE.
SOURCE American Hotel Income Properties REIT LP
