Early Warning Press Release in Respect of Northwest Healthcare Properties Real Estate Investment Trust

/NOT FOR DISTRIBUTION TO UNITED STATES OF AMERICA WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES./

TORONTO, Oct. 3, 2023 /CNW/ - Northwest Value Partners Inc. ("NWVP") announced that on October 2, 2023, it acquired 10,000 trust units ("Units") of Northwest Healthcare Properties REIT (the "REIT").

This press release is being disseminated pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues ("NI 62-103"). The 10,000 Units represent approximately 0.005% of the issued and outstanding Units and were acquired through the facilities of the Toronto Stock Exchange at an average price of $4.82 for aggregate consideration of $48,300. Prior to the acquisition of these Units, NWVP, its subsidiaries, control persons and entities controlled by NWVP beneficially owned 22,459,387 Units and 1,710,000 Class B limited partnership units of NWI Healthcare Properties LP, a subsidiary of the REIT (each of which is redeemable for a Unit and is attached to a special voting unit of the REIT, providing for voting rights in the REIT), representing in the aggregate, on a partially diluted basis, 9.997% of the issued and outstanding Units. After the acquisition of the 10,000 Units, NWVP beneficially controls 22,469,387 Units and 1,710,000 Class B limited partnership units of NWI Healthcare Properties LP, representing on a partially diluted basis, 10.002% of the issued and outstanding Units. All percentages in this press release are based on 241,634,843 Units being outstanding as of the date hereof.

NWVP and its affiliates are considering acquiring additional REIT securities or derivatives through open market transactions, private agreements or otherwise up to a maximum of 10.5%, until August 2024, of the issued and outstanding Units. In connection with NWVP's financing arrangements, NWVP has pledged certain Units it holds. From time to time, Units may be disposed of pursuant to the realization of such pledging arrangements. NWVP will continue to evaluate the REIT's business, financial condition and prospects. In light of the REIT's ongoing strategic review process and the significant discount in the REIT's trading price relative to what NWVP believes to be fundamental value, NWVP has increased its ownership position for investment purposes and given the position, would encourage the REIT to engage meaningfully with NWVP and other interested parties to enhance unitholder value. In response to general economic and industry conditions, the securities markets in general and those for the REIT's securities in particular, NWVP and its affiliates may propose various strategic initiatives, the pursuit of new investment opportunities or changes to the REIT's strategic plan. From time to time, NWVP and its affiliates may hold discussions with management, members of the Board of Trustees of the REIT, certain unitholders of the REIT and other persons regarding any such matter.

Comments on the REIT's Strategic Review Process

NWVP, the largest unitholder of the REIT, wholly owned by Paul Dalla Lana, wishes to express its disappointment with the REIT's response in respect of proposals that would have provided ample flexibility to complete its strategic review without cutting the monthly distribution by 55%. Mr. Dalla Lana commented, "I have always recognized the importance of the distribution to all the REIT's unitholders and under my leadership ensured it was always paid." 

NWVP believes the REIT has been presented with proposals that would have enhanced the REIT's liquidity position, supporting the sustainability of the REIT's distribution at least through to the completion of the strategic review process. Mr. Dalla Lana commented: "Given the numerous proposals received and disclosed by the REIT and what I would expect are other expressions of interest not yet disclosed by the REIT, I do not understand the REIT's decision to proceed with a distribution cut in isolation of announcing other strategic changes or transactions."

Mr. Dalla Lana added: "As the founder of the business and its largest unitholder, I continue to be highly supportive of any efforts focused on maximizing value for all unitholders. In addition, I remain supportive of the REIT's strategic review exercise, which I am hopeful will result in a favourable outcome for all unitholders. I also firmly believe the current trading price for the REIT's units does not represent the value of the REIT's business. As a result, in conjunction with partners, I intend to submit a proposal for the REIT's entire business that will maximize value for all unit holders."

Board Appointment

Mr. Dalla Lana said: "In accordance with the REIT's declaration of trust, whereby NWVP is granted a board seat when it exceeds 10% ownership, we will work with the REIT to affect this right. The nominee will be a seasoned capital markets professional who I am highly confident will be additive to the REIT's Board of Trustees and will provide experience will provide useful guidance to the REIT in surfacing value for all unitholders."

In accordance with NI 62-103, NWVP will file an early warning report regarding these transactions on the System for Electronic Document Analysis and Review (SEDAR) at www.sedar.com under Northwest Healthcare Properties REIT's issuer profile. A copy of this early warning report can be obtained by contacting Paul Dalla Lana, President, of NWVP at [phone].

NWVP's head office is located at MaRS Centre 661 University Avenue, Suite 470 Toronto, Ontario M5G 1M1.

The REIT's head office is located at 180 Dundas Street West, Suite 1100, Toronto, Ontario, M5G 1Z8.

SOURCE Northwest Value Partners Inc.

Northwest Value Partners Inc., Paul Dalla Lana, President, Tel: [phone] [email protected]