WPT Industrial REIT announces completion of its previously announced public offering of trust units and acquisition of an industrial property in Kentucky

/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES/

TORONTO, April 4, 2014 /CNW/ - WPT Industrial Real Estate Investment Trust (TSX:WIR.U) (the "REIT") announced today that it has completed its previously announced public offering of trust units of the REIT ("Units") with a syndicate of underwriters, co-led by RBC Capital Markets and CIBC, on a bought deal basis (the "Offering"). A total of 3,478,200 Units (including Units issued pursuant to the exercise in full of the over-allotment option granted to the underwriters by the REIT) were issued at a price of US$9.30 per Unit (the "Offering Price") for total gross proceeds of US$32,347,260.

As part of the Offering, Welsh Property Trust, LLC ("Welsh"), the REIT's external asset and property manager, purchased 752,700 Units at the Offering Price, pursuant to the exercise of its pre-emptive right under the agreement of limited partnership governing WPT Industrial, LP (the "Partnership"), the REIT's operating subsidiary. Welsh now directly and indirectly owns 752,700 Units and 13,059,709 Class B partnership units of the Partnership ("Class B Units"), representing an approximate 50.7% effective interest in the REIT (assuming all Class B Units are redeemed for Units, but otherwise on a non-diluted basis), provided that the 2,192,347 Class B Units issued to a subsidiary of Welsh in connection with the REIT's acquisition of a property located in Illinois on July 15, 2013 may not be redeemed for Units until Toronto Stock Exchange approval has been received.

The REIT also announced today that it has completed the previously announced acquisition of a 300,000 square foot distribution facility located in Hebron, Kentucky (near Cincinnati, Ohio) (the "Kentucky Property") for a purchase price of US$13.3 million (exclusive of closing and transaction costs and acquisition fee) paid in cash using a portion of the net proceeds of the Offering. The REIT, through the Partnership, indirectly acquired the Kentucky Property from Welsh at Welsh's cost of acquisition plus certain expenses and expenditures. The REIT intends to place new, fixed rate term mortgage financing on the Kentucky Property following closing of this acquisition.

With the completion of the Kentucky Property acquisition, the REIT's portfolio now consists of 37 industrial properties and two office properties totalling approximately 10.2 million square feet of gross leaseable area.

The REIT used approximately US$13.3 million of the net proceeds of the Offering towards the purchase price of the Kentucky Property, excluding closing costs. The REIT expects to use the approximately US$17.5 million remaining net proceeds of the Offering (after deducting the underwriting fee and estimated offering expenses) to partially fund the purchase price for its previously announced acquisition of a 1.5 million square foot distribution facility located in Atlanta, Georgia (the "Atlanta Property") to be acquired from a third party vendor. The REIT expects to close the acquisition of the Atlanta Property on or about April 30, 2014. In the event the acquisition of the Atlanta Property is not completed, the remaining net proceeds of the Offering will be used by the REIT to fund future acquisitions, repayment of indebtedness and for general trust purposes.

The Units under the Offering were offered in Canada pursuant to a short form prospectus filed with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada, pursuant to National Instrument 44-101 - Short Form Prospectus Distributions. A copy of the short form prospectus is available under the REIT's profile on the SEDAR website at www.sedar.com.

The acquisition of the Kentucky Property and the purchase by Welsh of Units under the Offering pursuant to its pre-emptive right constitute "related party transactions" under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Pursuant to sections 5.5(a) and 5.7(1)(a) of MI 61-101, the REIT was exempt from obtaining a formal valuation and minority approval of the REIT's unitholders due to the fair market value of the acquisition and the Units to be acquired by Welsh under the Offering being below 25% of the REIT's market capitalization for purposes of MI 61-101. The acquisition and Welsh's participation in the Offering were reviewed and considered by the independent members of the REIT's board of trustees.

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. The Units 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.

About WPT Industrial Real Estate Investment Trust:

WPT Industrial Real Estate Investment Trust is an unincorporated, open-ended real estate investment trust established pursuant to a declaration of trust under the laws of the Province of Ontario.  The REIT has been formed to own and operate an institutional-quality portfolio of primarily industrial properties located in the United States, with a particular focus on warehouse and distribution industrial real estate.  WPT Industrial, LP (the REIT's operating subsidiary) indirectly owns a portfolio of properties consisting of approximately 10.2 million square feet of gross leasable area, comprised of 37 industrial properties and two office properties located in 12 states within the United States. 

About Welsh Property Trust, LLC:

Welsh Property Trust, LLC ("Welsh"), a privately held real estate investment management company, is the external asset manager and property manager of the REIT. The Welsh organization was founded in 1977 and has extensive experience in the acquisition, management and disposition of industrial and office real estate assets in attractive markets throughout the United States.

Forward-Looking Statements

This press release contains "forward-looking information" as defined under applicable Canadian securities law ("forward-looking information" or "forward-looking statements") which reflect management's expectations regarding objectives, plans, goals, strategies, future growth, results of operations, performance, business prospects and opportunities of the REIT. The words" plans", "expects", "does not expect", "scheduled", "estimates", "intends", "anticipates", "does not anticipate", "projects", "believes" or variations of such words and phrases or statements to the effect that certain actions, events or results "may", "will", "could", "would", "might", "occur", "be achieved" or "continue" and similar expressions identify forward-looking statements. Some of the specific forward-looking statements in this press release include, but are not limited to, statements with respect to: the closing of the acquisition of the Atlanta Property and the expected closing date thereof; the REIT's intention to place new, fixed-rate term mortgage financing on the Kentucky Property following closing of the acquisition; and the REIT's intended use of the remaining proceeds of the Offering. Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable by management of the REIT as of the date of this press release, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The REIT's estimates, beliefs and assumptions, which may prove to be incorrect, include the various assumptions set forth herein, including, but not limited to, the REIT's and each property's future growth potential, results of operations, future prospects and opportunities, the demographic and industry trends remaining unchanged, no change in legislative or regulatory matters, future levels of indebtedness, the tax laws as currently in effect remaining unchanged, the continual availability of capital, the current economic conditions remaining unchanged, and continued positive net absorption and declining vacancy rates in the markets in which the REIT's properties are located.

When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not the times at or by which such performance or results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under "Risk Factors" in each of the REIT's annual information form for the year ended December 31, 2013 and final short form prospectus dated March 28, 2014, which are available under the REIT's profile on SEDAR at www.sedar.com. These forward-looking statements are made as of the date of this press release and, except as expressly required by applicable law, the REIT assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

SOURCE: WPT Industrial Real Estate Investment Trust

Scott Frederiksen, Chief Executive Officer, WPT Industrial Real Estate Investment Trust, Tel: [phone], Fax: [phone], www.wptreit.com