Artis Real Estate Investment Trust Announces Sale of GTA Industrial Portfolio for $750 Million
- Artis enters into an agreement to sell GTA industrial portfolio for $750.0 million, representing a price per square foot of $297
- Sale price for the transaction exceeds the REIT's most recently reported IFRS fair value of $550.7 million by 36.2%
- Transaction is expected to generate net proceeds of approximately $734 million that will be used to strengthen the REIT's balance sheet and to provide liquidity and flexibility to execute the REIT's previously announced strategy
WINNIPEG, MB, June 21, 2021 /CNW/ - Artis Real Estate Investment Trust ("Artis" or the "REIT") (TSX: AX.UN) announced today that it has entered into an unconditional agreement to sell its Greater Toronto Area ("GTA") industrial portfolio, comprising 28 properties totaling over 2.5 million square feet of leasable area located in the GTA for $750.0 million. The sale price represents a price per square foot of $297.
"The monetization of our GTA industrial portfolio represents a significant milestone in the implementation of our Business Transformation Plan," said Samir Manji, President and Chief Executive Officer of Artis. "This transaction reaffirms the demand for industrial real estate assets and demonstrates the significant value that exists within our diversified real estate portfolio. The net proceeds from the sale will be used to meaningfully reduce our debt and provide ample financial flexibility to execute on our return of capital and value investing strategies."
In March 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 announced that it will monetize part of its industrial portfolio to strengthen its balance sheet and to provide Artis with the liquidity and flexibility to execute on this strategy.
After adjusting for the repayment of one outstanding mortgage of approximately $15.2 million and anticipated closing costs, the transaction will generate net proceeds of approximately $734 million. The sale price for the portfolio exceeds the REIT's most recently reported International Financial Reporting Standards ("IFRS") fair value of $550.7 million by 36.2%.
"Today's announcement marks a milestone transaction for Artis, and truly reinforces the strength of our management team, the value of our platform and our ability to unlock unitholder value," said Ben Rodney, Chair of the Board of Trustees of Artis. "We are very pleased with the outcome and look forward to building upon this important achievement in the quarters to come."
The transaction is the result of an internally managed, formal and extensive sale process.
The transaction is subject to routine Competition Bureau approval and is expected to close in the third quarter of 2021.
Artis is a diversified Canadian real estate investment trust with a portfolio of industrial, office and retail properties in Canada and the United States. Artis' vision is 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.
Cautionary Statements
This press release contains forward-looking statements. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words "expects", "anticipates", "intends", "estimates", "projects", "seeks", and similar expressions or variations of such words and phrases or state that certain actions, events or results ''may'', ''would'' or ''will'' occur or be achieved are intended to identify forward-looking statements. Particularly, statements regarding Artis' Business Transformation Plan, the steps required to implement the Business Transformation Plan, building Artis into a best-in-class asset management and investment platform focused on value investing in real estate, significant value creation, the REIT's ability to execute its strategy, the REIT's ability to unlock unitholder value and anticipated net proceeds of the transaction are forward-looking statements. Forward-looking statements are based on a number of factors and assumptions which have been used to develop such statements, but which may prove to be incorrect. Artis cannot assure investors that actual results will be consistent with any forward-looking statements and Artis assumes no obligation to update or revise such forward-looking statements to reflect actual events or new circumstances. All forward-looking statements contained in this press release are qualified by this cautionary statement.
SOURCE Artis Real Estate Investment Trust
Mr. Samir Manji, President and Chief Executive Officer, Ms. Jaclyn Koenig, Chief Financial Officer or Ms. Heather Nikkel, Vice-President - Investor Relations of the REIT at 1.204.947.1250
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