MONTRÉAL, Aug. 21, 2024 /CNW/ - PRO Real Estate Investment Trust ("PROREIT" or the "REIT") (TSXV: PRV.UN) is pleased to announce that it has entered into a binding agreement to acquire a 100% interest in a strategically located industrial building in Dorval, a suburb of Montréal, Québec, adjacent to Montréal-Trudeau International Airport, for a total purchase price of $32.6 million (excluding closing costs), representing a going-in capitalization rate of approximately 6.7%.
The purchase price will be financed through a new $21.2 million five-year first mortgage at a rate of 5.10%, with the balance funded by proceeds from previously announced non-core property sales and a draw on available operating facilities.
"As we continue to successfully execute on our capital recycling program, we are pleased with this accretive acquisition which aligns with our growth strategy and medium-term goals of expanding our industrial footprint to 90% of base rent and $2 billion in total asset value," said Gordon Lawlor, President and CEO, PROREIT.
High-quality, light industrial building
The single-tenant industrial building, located at 2945 André Avenue in Dorval, Québec, comprises 134,340 square feet of gross leasable area ("GLA") and features a warehouse clear height of 24-27 feet, along with an efficient loading configuration. It is fully occupied by a national logistics company under a long-term lease that includes annual rent escalations and a renewal option. The tenant has been in place at the building since 2013.
Upon completion of this acquisition, PROREIT's portfolio will consist of 115 income-producing commercial properties, including a 50% ownership interest in 42 investment properties, totaling approximately 6.1 million square feet of GLA. This acquisition will further increase the portfolio's exposure to the industrial sector, bringing it to approximately 86% of GLA and 80% of base rent on a pro forma basis. The acquisition is subject to customary closing conditions and is expected to close in the third quarter of 2024.
About PROREIT
PROREIT (TSX:PRV.UN) is an unincorporated open-ended real estate investment trust established pursuant to a declaration of trust under the laws of the Province of Ontario. Founded in 2013, PROREIT owns a portfolio of high-quality commercial real estate properties in Canada, with a strong industrial focus in robust secondary markets.
For more information on PROREIT, please visit the website at: https://proreit.com.
Forward-Looking Statements
This press release contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of applicable securities legislation, including statements relating to certain expectations, projections, growth plans and other information related to PROREIT's business strategy and future plans. Forward-looking statements are based on a number of assumptions and are subject to a number of risks and uncertainties, many of which are beyond PROREIT's control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking statements.
Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intent", "estimate", "anticipate", "believe", "should", "plans", or "continue", or similar expressions suggesting future outcomes or events. Forward-looking statements contained in this press release include, without limitation, statements pertaining to the execution by PROREIT of its growth strategy, the proposed increase of PROREIT's footprint in the light industrial sector, the contemplated acquisition of an industrial building for a total purchase price of approximately $32.6 million (excluding closing costs), the timing thereof and the financing terms of such acquisition, and the medium-term goals (three to five years) of reaching $2 billion in assets and 90% of industrial base rent.
PROREIT's objectives and forward-looking statements are based on its current assumptions about future events, including that (i) PROREIT will receive financing on favourable terms; (ii) the future level of indebtedness of PROREIT and its future growth potential will remain consistent with PROREIT's current expectations; (iii) there will be no changes to tax laws adversely affecting PROREIT's financing capacity or operations; (iv) the impact of the current economic climate and the current global financial conditions on PROREIT's operations, including its financing capacity and asset value, will remain consistent with PROREIT's current expectations; (v) the performance of PROREIT's investments in Canada will proceed on a basis consistent with PROREIT's current expectations; and (vi) capital markets will provide PROREIT with readily available access to equity and/or debt.
Without limiting the foregoing, the medium-term (three to five years) targets of PROREIT are based on PROREIT's current business plan and strategies and are not intended to be a forecast of future results. The medium-term targets contemplate the REIT's historical growth and certain assumptions including but not limited to (i) current global capital market conditions, (ii) access to capital, (iii) interest rate exposure, (iv) availability of high-quality industrial properties for acquisitions, (v) dispositions of retail and office properties, and (vi) capacity to finance acquisitions on an accretive basis.
Although PROREIT believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct, and since forward-looking statements inherently involve risks and uncertainties, undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such forward-looking statements. The forward-looking statements contained in this news release are expressly qualified in their entirety by this cautionary statement. All forward-looking statements in this press release are made as of the date of this press release. PROREIT does not undertake to update any such forward-looking information whether as a result of new information, future events or otherwise, except as required by law.
Additional information about these assumptions and risks and uncertainties is contained under "Risk Factors" in PROREIT's latest annual information form and "Risk and Uncertainties" in PROREIT's management's discussion and analysis for the three and six months ended June 30, 2024, which are available under PROREIT's profile on SEDAR+ at www.sedarplus.ca
SOURCE Pro Real Estate Investment Trust
FOR FURTHER INFORMATION: Investor Relations: PRO Real Estate Investment Trust, Gordon G. Lawlor, CPA, President and Chief Executive Officer, 514-933-9552; PRO Real Estate Investment Trust, Alison Schafer, CPA, Chief Financial Officer and Secretary, 514-933-9552
Share this article