Choice Properties Real Estate Investment Trust Completes Acquisition of Portfolio from Loblaw Companies Limited

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TORONTO, June, 1, 2015 /CNW/ - Choice Properties Real Estate Investment Trust ("Choice Properties" or the "Trust") (TSX: CHP.UN) today completed the acquisition of a portfolio of 38 retail properties from certain subsidiaries of Loblaw Companies Limited (collectively, "Loblaw"), for an aggregate purchase price of approximately $201.3 million, excluding transaction costs.

Highlights of Acquired Portfolio

• Immediately accretive with an estimated stabilized net operating income ("NOI") of approximately $14.5 million, representing an implied capitalization rate of 7.19%;
• Expands portfolio by approximately 1.5 million square feet ("sq. ft.") of Gross Leasable Area ("GLA"), with an occupancy rate of over 99%; and
• Located across Canada and consists of 36 Loblaw bannered stand-alone supermarkets and two Loblaw-anchored retail sites with other ancillary tenants.

With the completion of this acquisition, Choice Properties' portfolio consists of 513 properties comprising 495 retail properties, 11 warehouse properties, one office complex, one industrial property and five parcels of land, totaling approximately 41.3 million sq. ft. across Canada.

The acquisition was funded through the issuance of 9,237,166 Class B LP Units of Choice Properties Limited Partnership, which have a value of $102.2 million and the balance in cash. With the completion of this transaction, Loblaw's and George Weston Limited's effective ownership interests in the Trust are 83.1% and 5.4%, respectively.

Portfolio Summary

The acquired portfolio comprises approximately 1.5 million sq. ft. of GLA across Canada with an average building age of 17 years, which is in-line with the average building age of the Trust's existing portfolio.  As principal tenant, Loblaw represents over 98% of total GLA and NOI of this portfolio, with initial lease terms of 15 years for the Loblaw leased space. 

Property Summary

Address	Banner	Year Built	Loblaw GLA	Ancillary GLA	% Occupied
31 - 35 Broadway St., Kensington, PE	Save Easy	1997	12,998	5,920	82%
419 Main St., Doaktown, NB	Save Easy	1998	10,500	-	100%
7000 Route 125, Chertsey, QC	Provigo	2007	24,661	-	100%
11 Redway Rd., Toronto, ON	Loblaws	1994	60,950	-	100%
449 Parliament St., Toronto, ON	no frills	1999	14,414	-	100%
66 Fourth Ave., Englehart, ON	valu-mart	1990	7,968	-	100%
519 Main St., Powassan, ON	valu-mart	1990	14,222	-	100%
1120 Second Ave. E, Owen Sound, ON	Cash and Carry	1997	14,900	-	100%
24 - 65 Regional Road, Lively, ON	Your Independent Grocer	1990	30,768	-	100%
31-1 Hwy. #11 W, Cochrane, ON	valu-mart	1995	19,953	-	100%
15 McChesney Ave., Kirkland Lake, ON	Your Independent Grocer	1995	45,157	-	100%
55 Brunetville Road, Kapuskasing, ON	Your Independent Grocer	2000	41,585	-	100%
40 Meredith St. E, Little Current, ON	valu-mart	2000	10,726	-	100%
726 Principale St., Casselman, ON	no frills	2001	17,954	-	100%
512 St. Phillippe St., Alfred, ON	valu-mart	1999	17,507	-	100%
1012 Main St., Geraldton, ON	Extra Foods	2006	25,744	-	100%
127 Hastings St. N, Bancroft, ON	no frills	2005	25,338	-	100%
654 Algonquin Blvd. E, Timmins, ON	Your Independent Grocer	1992	50,020	-	100%
186 Mission Rd., Wawa, ON	valu-mart	1990	15,224	-	100%
75-85 - 105 Causley St., Blind River, ON	valu-mart	1999	10,132	16,411	95%
40 Meredith St., Gore Bay, ON	valu-mart	1990	9,486	-	100%
175 Cargill Rd., Winkler, MB	Real Canadian Superstore	2002	110,253	-	100%
1200 Main St. E, Swan River, MB	Extra Foods	1996	38,056	-	100%
206 Broadway St. East, Yorkton, SK	Real Canadian Superstore	1994	101,733	-	100%
30 Kenderdine Rd., Saskatoon, SK	Your Independent Grocer	1996	38,966	-	100%
315 Herold Rd, Saskatoon, SK	Your Independent Grocer	1997	42,568	-	100%
10851 - 100th St., Westlock, AB	Your Independent Grocer	2003	39,922	-	100%
10527 - 101 Ave, Lac La Biche, AB	Your Independent Grocer	2001	39,922	-	100%
5007 - 52nd St., Athabasca, AB	Your Independent Grocer	2001	40,136	-	100%
5701 - 47th Ave., Stettler, AB	no frills	1995	37,562	-	100%
4524 Feeney Ave., Terrace, BC	Real Canadian Wholesale Club	1997	53,904	-	100%
221 Highway 16, Burns Lake, BC	Real Canadian Wholesale Club	2000	51,241	-	100%
1501 Cook St, Creston, BC	Extra Foods	2000	38,798	-	100%
2110 Ryley Ave, Vanderhoof, BC	Your Independent Grocer	2000	38,049	-	100%
1792 - 9th Ave., Fernie, BC	Extra Foods	2003	39,922	-	100%
7000 - 27th St, Grand Forks, BC	Extra Foods	2004	40,374	-	100%
2335 Maple Dr. E, Quesnel, BC	Extra Foods	2004	58,224	-	100%
5001 Anderson Way, Vernon, BC	Real Canadian Superstore	2005	154,717	-	100%
			1,444,554	22,331	99.7%

About Choice Properties Real Estate Investment Trust

Choice Properties Real Estate Investment Trust is an owner, manager and developer of well-located commercial real estate across Canada. Choice Properties' initial portfolio spans approximately 41.3 million square feet of gross leasable area and consists of 513 properties primarily focused on supermarket-anchored shopping centres, stand-alone supermarkets and other retail properties. Choice Properties' strategy is to create value by enhancing and optimizing its property portfolio, which was built over thirty years by Loblaw, the REIT's principal tenant, and largest Unitholder. Choice Properties' strong alliance with Loblaw positions it well for future growth. For more information, visit Choice Properties' website at www.choicereit.ca and Choice Properties' issuer profile at www.sedar.com.

Forward–Looking Statements
This press release may contain forward-looking information within the meaning of applicable securities legislation, which reflects Choice Properties' current expectations regarding future events. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Choice Properties' control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, the factors discussed in Section 12 "Enterprise Risks and Risk Management" in the MD&A section of Choice Properties' First Quarter 2015 Report to Unitholders. Choice Properties does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

"NOI" is not a measure recognized under International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board and does not have any standardized meaning prescribed by IFRS. NOI is a supplemental measure of an issuer's performance and management believes that NOI is useful in the assessment of the REIT's operating performance for valuation purposes, and is also a relevant measure of the ability of the REIT to earn and declare distributions to Unitholders. NOI, as computed by the REIT, may differ from similar computations as reported by other similar organizations and, accordingly, may not be comparable to NOI reported by such organizations. NOI should not be construed as an alternative to comprehensive income determined in accordance with IFRS as indicators of the REIT's performance. For additional information regarding this non-IFRS measure, including the definition thereof, please refer to the REIT's most recent management's discussion and analysis of results of operations and financial condition, a copy of which is available at www.sedar.com.

SOURCE Choice Properties Real Estate Investment Trust

Kim Lee, Vice President, Investor Relations and Financial Planning & Analysis, Choice Properties Real Estate Investment Trust, t [phone], e [email protected]