Starlight U.S. Multi-Family Core Fund and Starlight U.S. Multi-Family (No. 2) Core Fund to acquire apartment complex in Dallas, Texas

/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

TORONTO, Feb. 24, 2014 /CNW/ - Starlight U.S. Multi-Family Core Fund (TSX.V: UMF.A, UMF.U) (the "Fund") and Starlight U.S. Multi-Family (No. 2) Core Fund (TSX.V: SUD.A, SUD.U) ("Fund No. 2") announced today that they have entered into an agreement to acquire Soho Parkway Apartments ("Soho Parkway"), a 379 unit, garden style, Class A, apartment complex built in 2008 and located at 6653 McKinney Ranch Parkway in McKinney, Texas, a rapidly growing area of North Dallas.

In connection with the acquisition, the Fund is expected to acquire a 25% interest and Fund No. 2 is expected to acquire a 75% interest in Soho Parkway. In order to satisfy its cash portion of the purchase price, the Fund has secured a supplementary loan on the Falls of Copper Lake for up to approximately US$4,000,000 that will mature on April 1, 2017. The supplementary loan will be interest only for the entire term and will be payable at a rate equal to the interpolated three-year United States Treasury Yield + 3.52%. Fund No. 2 expects to satisfy its cash portion of the purchase price with the remaining proceeds from its initial public offering completed on November 15, 2013 at which time Fund No. 2 will be fully deployed.

Each of the Fund and Fund No. 2 are expected to assume responsibility for the liabilities of Soho Parkway on a pro-rata ownership basis. It is expected, that all decision making in respect of Soho Parkway, including day-to-day and material decisions, will be shared by the Fund and Fund No. 2 equally through their established governance practices.

Soho Parkway

Soho Parkway consists of 16, three storey walk-up buildings on a 15.04 acre site and is comprised of one, two and three bedroom units. The apartment units are of an above average size, well laid out and contain modern features including laminate wood flooring, granite counter tops, cultured marble vanities, brushed nickel fixtures and full size washer and dryer sets. Amenities at Soho Parkway include a central clubhouse with a 24-hour state-of-the-art fitness centre, a resident lounge with a large screen television and an executive business centre. Outdoor amenities include a resort style pool with barbeque picnic areas. Soho Parkway also has Wi-Fi high speed internet access throughout the property. Soho Parkway's current occupancy is approximately 90.8%.

Following completion of the acquisition, it is expected that property management at Soho Parkway will be transferred to the Pinnacle Family of Companies ("Pinnacle"), the fourth largest third party, multi-family property manager in the United States. Pinnacle is currently managing Bridgemoor at Denton and Greenhaven Apartments located in North Dallas and Villages of Towne Lake located in Houston for the Fund.

Pursuant to a purchase and sale agreement made as of January 16, 2014, Soho Parkway Acquisition LLC, an indirect wholly owned subsidiary owned 25% by the Fund and 75% by Fund No. 2, has agreed to purchase Soho Parkway unencumbered. It is expected that the Fund will contribute US$10,325,000 for its 25% interest in the property and Fund 2 will pay US$30,975,000 for its 75% interest in the property. The purchase agreement contains customary representations and warranties for a transaction of this nature. Subject to the satisfaction or waiver of conditions precedent, the purchase of the property is scheduled to close on or about April 1, 2014. The purchase agreement is a material contract of Fund 2.

A first mortgage loan in respect of the purchase of Soho Apartments in the amount of approximately US$28,300,000 has been secured for a three year term with two one year extensions available. The loan will be interest only for the entire term and will be payable at an annual rate of LIBOR + 2.00%.

The Fund and Fund No. 2 Portfolios

Following completion of the acquisition of Soho Parkway, the Fund expects to own and operate a portfolio comprising interests in 1,747 recently constructed, Class "A" stabilized, income producing multi-family real estate suites located in Dallas-Fort Worth and Houston, Texas, and Fund No. 2 expects to own and operate a portfolio comprising interests in 1,131 recently constructed, Class "A" stabilized, income producing multi-family real estate suites located in Austin, Dallas-Fort Worth and Houston, Texas.

About Starlight U.S. Multi-Family Core Fund and Starlight U.S. Multi-Family (No. 2) Core Fund

Each of the Fund and Fund No. 2 is a limited partnership formed under the Limited Partnerships Act (Ontario) for the primary purpose of indirectly acquiring, owning and operating a portfolio of diversified income producing rental properties in the U.S. multi-family real estate market.

Forward-Looking Information

This news release contains statements that may constitute forward-looking statements within the meaning of Canadian securities laws and which reflect the current expectations of the Fund and Fund No. 2 regarding future events, including statements concerning the acquisition of Soho Parkway, the financing of Soho Parkway and the refinancing of the Falls of Copper Lake by the Fund. Particularly, statements regarding future results, performance, achievements, prospects or opportunities for the Fund or the real estate industry are forward-looking statements. In some cases, forward-looking statements can be identified by terms such as "may", "might", "will", "could", "should", "would", "occur", "expect", "plan", "anticipate", "believe", "intend", "seek", "aim", "estimate", "target", "project", "predict", "forecast", "potential", "continue", "likely", "schedule", or the negative thereof or other similar expressions concerning matters that are not historical facts.

The forward-looking statements in this news release involve risks and uncertainties, including those set forth in the materials of the Fund and Fund No. 2 filed with the Canadian securities regulatory authorities from time to time at www.sedar.com. Actual results could differ materially from those projected herein. Those risks and uncertainties include, among other things, risks related to: reliance on the manager of the Fund and Fund No. 2; the ability to complete the acquisition of Soho Parkway; the terms and availability of financing for Soho Parkway; the terms and availability of supplementary financing for the Falls of Copper Lake by the Fund; the expected benefits of the ownership of Soho Parkway; the relationship and obligations of the Fund and Fund No. 2 in respect of Soho Parkway; the experience of the officers and directors and the Fund and Fund No. 2; substitutes for residential real estate rental suites; reliance on property management; competition for real property investments and tenants; and U.S. market factors.

Information contained in forward-looking statements is based upon certain material assumptions that were applied in developing such forward-looking statements including management's perceptions of historical trends, current conditions and expected future developments, as well as other considerations that are believed to be appropriate in the circumstances, including the following: the ability of the Fund and Fund No. 2 to complete the acquisition of Soho Parkway and secure acceptable financing; the ability of the Fund to secure acceptable financing for the Falls of Copper Lake; the ability of the manager of the Fund and Fund No. 2 to manage and operate Soho Parkway; the relationship and obligations between the Fund and Fund No. 2 in respect of Soho Parkway; the inventory of multi-family real estate properties; the population of multi-family real estate market participants; assumptions about the markets in which the Fund and Fund No. 2 operate; the global and North American economic environment; foreign currency exchange rates; and governmental regulations or tax laws. Readers are cautioned against placing undue reliance on forward-looking statements. Except as required by applicable Canadian securities laws, neither the Fund nor its manager undertakes any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE: Starlight U.S. Multi-Family Core Fund

Evan Kirsh
President
Starlight U.S. Multi-Family Core Fund
Starlight U.S. Multi-Family (No. 2) Core Fund
647-725-0417
[email protected]