NORTHWEST HEALTHCARE PROPERTIES REIT ANNOUNCES $125 MILLION CONVERTIBLE DEBENTURE BOUGHT DEAL

TSX: NWH.UN

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TORONTO, Aug. 16, 2022 /CNW/ - NorthWest Healthcare Properties Real Estate Investment Trust (TSX: NWH.UN) ("NorthWest" or the "REIT") announced today a public offering, on a "bought deal" basis, of $125 million principal amount of convertible unsecured subordinated debentures (the "Debentures"), at a price of $1,000 per Debenture, with an interest rate of 6.25% per annum, payable semi-annually on the last date of August and February commencing on February 28, 2023 (the "Offering"). The Debentures will mature on August 31, 2027. The offering is being made through a syndicate of underwriters co-led by RBC Capital Markets and Scotiabank.

The REIT has also granted the underwriters the option to purchase up to $18.75 million principal amount of additional Debentures at a price of $1,000 per Debenture to cover over-allotments, exercisable in whole or in part anytime up to 30 days following closing of the Offering.

The Debentures will be convertible at the holder's option into units of the REIT at a conversion price of $16.00 per unit. The Debentures will not be redeemable prior to August 31, 2025. From September 1, 2025 to August 31, 2026, the Debentures may be redeemed in whole or in part from time to time at the REIT's option, at a price equal to their principal amount plus accrued and unpaid interest, provided that the volume weighted average trading price of the units on the Toronto Stock Exchange for the 20 consecutive trading days preceding the date on which the notice of redemption is given is not less than 125% of the conversion price. From September 1, 2026 onward, the Debentures will be redeemable at the option of the REIT, in whole or in part, at a redemption price equal to par plus accrued and unpaid interest.

The REIT intends to use the net proceeds of the Offering to repay short-term floating rate debt with a weighted average interest rate of approximately 7.6% and for general trust purposes.

The Offering and the identified use of proceeds are not expected to impact the REIT's leverage metrics, are expected to improve the REIT's debt maturity profile by extending the term of previous short-term acquisition debt, and are expected to reduce its exposure to floating rate debt which provides NWH with additional certainty for its interest expense in coming years.

The REIT continues to make progress on sourcing capital partners to form joint ventures for its U.S. and U.K. portfolios. The REIT expects the U.K. and U.S. joint ventures to close in H2 2022, following which the REIT's proportionate loan-to-value ratio is expected to decrease to approximately 45%.

The Offering is subject to normal regulatory approvals, including approval of the Toronto Stock Exchange and is expected to close on or about August 25, 2022.

The Debentures will be offered pursuant to the REIT's base shelf prospectus dated November 27, 2020. The terms of the Debentures will be described in a prospectus supplement to be filed with securities regulators in all provinces and territories of Canada and may also be offered by way of private placement in the United States.

The securities offered have not been registered under the U.S. 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. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About NorthWest Healthcare Properties Real Estate Investment Trust

NorthWest Healthcare Properties Real Estate Investment Trust (TSX: NWH.UN) is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. As at June 30, 2022, the REIT provides investors with access to a portfolio of high quality international healthcare real estate infrastructure comprised of interests in a diversified portfolio of 232 income-producing properties and 18.5 million square feet of gross leasable area located throughout major markets in Canada, The United States, Brazil, Europe, Australia and New Zealand. The REIT's portfolio of medical office buildings, clinics, and hospitals is characterized by long term indexed leases and stable occupancies. With a fully integrated and aligned senior management team, the REIT leverages over 250 professionals in nine offices in five countries to serve as a long term real estate partner to leading healthcare operators.

Forward Looking Information

This press release contains "forward-looking statements" within the meaning of applicable securities laws, including statements about the Offering and the proposed use of proceeds thereof, the expectations regarding the REIT's debt maturity profile, floating rate debt exposure and leverage metrics, the REIT's progress on sourcing capital partners to form joint ventures for its U.S. and U.K. portfolios, the closings of the U.S. and U.K. joint ventures, the anticipated timelines of such closings and the expected loan-to-value ratio reduction. The forward-looking statements in this news release are based on certain assumptions, including without limitation that all conditions to completion of the Offering will be satisfied or waived. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations including the risk that the U.S. and U.K. joint ventures will not be completed as anticipated, the Offering will not be completed on the terms proposed or at all or that other developments may arise that result in the REIT having to further increase its leverage. The statements in this news release are made as of the date of this release. Although the REIT believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. A discussion of the risk factors applicable to the REIT is contained under the heading "Risk Factors" in the REIT's annual information form dated March 31, 2022, a copy of which may be obtained on the SEDAR website at www.sedar.com.

SOURCE NorthWest Healthcare Properties Real Estate Investment Trust

Paul Dalla Lana, CEO, NorthWest Healthcare Properties REIT, [phone] x1001