Melcor Real Estate Investment Trust (TSX:MR.UN) completed the acquisition of portfolio of five commercial properties from Melcor Developments Ltd..
January 12, 2018
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Melcor Real Estate Investment Trust (TSX:MR.UN) agreed to acquire portfolio of five commercial properties from Melcor Developments Ltd. (TSX:MRD) for CAD 80.9 million on December 4, 2017. As per the terms of agreement, Consideration will be paid with the combination of CAD 34.03 million in cash and by issuance of 0.283 million Class B LP units and 1.33 million Class C LP units and CAD 31.04 million by mortgage assumption. to Melcor. Post acquisition, Melcor Developments Ltd. will have 53.6% ownership of Melcor Real Estate Investment Trust. Melcor Real Estate Investment Trust finances the acquisition through the sale, on a bought deal basis, of approximately CAD 15 million of subscription receipts and CAD 20 million aggregate principal amounts from convertible unsecured subordinated debentures. Acquisition of five commercial properties includes Kingsview Market Centre Phases Two & Four, Telford Industrial Phase Four, Chestermere Station Phase Seven, The District at North Deerfoot Phase One and West Henday Promenade Phase two. The acquisition will be conditional upon the satisfaction of certain conditions including lender consents, completion of the debt offering, issuance of Class B LP Units and Class C LP Units in subscription offering, unitholders approval and TSX approval. Melcor Real Estate Investment trustees unanimously recommend unitholders to vote in favor of transaction. On January 10, 2018, Melcor Real Estate Investment Trust unitholders approved the acquisition. The board of trustees appointed a special committee of independent elected trustees to consider acquisition. The Special Committee retained Altus Group Limited to prepare independent appraisals of each of the transaction and also retained Trimaven Capital Advisors to both act as an independent financial advisor to provide fairness opinion. The transaction is expected to occur on or before January 12, 2018. The transaction is expected to be immediately accretive to the AFFO per trust unit of the REIT and will increase the GLA in the REIT's portfolio by approximately 6.4%. CIBC World Markets, Inc. acted as financial advisor to Melcor Real Estate Investment.
Melcor Real Estate Investment Trust (TSX:MR.UN) completed the acquisition of portfolio of five commercial properties from Melcor Developments Ltd. (TSX:MRD) on January 12, 2018. Melcor will continue to manage these properties under the asset and property management agreements.
Melcor Real Estate Investment Trust is a Canada-based open-ended real estate investment trust. The Companyâs principal business is to acquire, own and manage office, retail, and industrial properties in select markets across Western Canada. Its portfolio consists of interests in approximately 38 properties representing approximately 3.1 million square feet of gross leasable area located Alberta and in Regina, Saskatchewan, and Kelowna, British Columbia. Melcor has approximately five million square feet in planned commercial developments. Its portfolio of properties is located across Canada in various cities, which include Coast Home Centre in Edmonton; Kingsview Market in Airdrie; Birks Building in Edmonton; Capilano Centre in Edmonton; Crowfoot Business Centre in Calgary; Parliament Place in Regina, Melton Building in Alberta, and others. The properties are externally managed, administered and operated by Melcor Developments Ltd. (Melcor).