Firm Capital Property Trust announces the closing of the acquisition of a 50% interest in an industrial portfolio and private placement

TORONTO, Aug. 1, 2013 /CNW/ - Firm Capital Property Trust ("FCPT" or the "Trust") (TSXV : FCD.UN) is pleased to announce that the Trust has closed the previously announced purchase of a 50% interest in 25 industrial buildings located in Montreal. The acquisition price of the entire portfolio is $48.2 million, excluding transaction costs (the "Portfolio").

The Portfolio is comprised of 1,029,898 square feet located in Montreal. The Portfolio consists of seventeen multi-tenant and eight single-tenant industrial buildings. The Portfolio has in excess of 90 tenants. The Portfolio is in proximity to Pierre Elliott Trudeau Airport as well as the Trans-Canada Highway. The Portfolio is currently approximately 90% occupied.

The Portfolio is being financed with new first mortgage financing provided by two Canadian Chartered Banks for proceeds of approximately $33 million at a weighted average interest rate of approximately 3.8%. 50% of the Portfolio was acquired by the Trust, while the remaining 50% was acquired by an entity associated with the Asset Manager that consists almost entirely of entities related to senior management and trustees of FCPT. The joint acquisition by the parties associated with the Asset Manager confirms the alignment of interests and is in accordance with the Trust's stated business strategy of completing joint acquisitions with experienced real estate industry professionals.

PRIVATE PLACEMENT
The funding required by the Trust for its 50% interest came from a combination of existing cash resources and a $6.4 million non-brokered private placement at $5.10 per trust unit. Closing of the non-brokered private placement is subject to a customary four month hold period, which expires on December 2, 2013.

ACQUISITION IMPACT ON THE TRUST:
Pro-forma the Portfolio acquisition and financing activity, the Trust's Adjusted Funds From Operations ("AFFO") payout ratio is anticipated to be below 80% and Debt to Gross Book Value of approximately 53%. The Trust will increase the size of its current portfolio to approximately $58 million and will grow to 30 properties. In addition, the acquisition adds diversification through the addition of the industrial asset class to the existing retail and medical office portfolio.

ABOUT FIRM CAPITAL PROPERTY TRUST
Firm Capital Property Trust is focused on creating long-term value for Unitholders, through capital preservation and disciplined investing to achieve stable distributable income. In partnership with management and industry leaders, The Trust's plan is to co-own a diversified property portfolio of multi-residential, flex industrial, net lease convenience retail, and core service provider professional space. In addition to stand alone accretive acquisitions, the Trust will make joint acquisitions with strong financial partners and acquisitions of partial interests from existing ownership groups, in a manner that provides liquidity to those selling owners and professional management for those remaining as partners.  Firm Capital Realty Partners Inc., through a structure focused on an alignment of interests with the Trust, will source, syndicate and participate in investments.

FORWARD LOOKING INFORMATION
This press release may contain forward-looking statements. In some cases, forward-looking statements can be identified by the use of words such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", and by discussions of strategies that involve risks and uncertainties. The forward-looking statements are based on certain key expectations and assumptions made by the Trust regarding, among other things, the use of the net proceeds from the Offering, the closing of the Offering, and the closing of the Acquisition. By their nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. Although management of the Trust believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that future results, levels of activity, performance or achievements will occur as anticipated. Neither the Trust nor any other person assumes responsibility for the accuracy and completeness of any forward-looking statements, and no one has any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or such other factors which affect this information, except as required by law.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, which may be made only by means of a prospectus, nor shall there be any sale of the Units in any state, province or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under securities laws of any such state, province or other jurisdiction. The Units of the Firm Capital Property Trust have not been, and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or delivered in the United States absent registration or an application for exemption from the registration requirements of U.S. securities laws.

SOURCE: Firm Capital Property Trust

Robert McKee
President & Chief Executive Officer
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Sandy Poklar
Chief Financial Officer
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