CAPREIT Accelerates Capital Recycling With $477 Million in New Strategic Transactions
01 Agosto 2024 - 6:45AM
Canadian Apartment Properties Real Estate Investment Trust
(“CAPREIT”) (TSX:CAR.UN) announced today that, since the first
quarter of 2024, it has completed six acquisitions of new build
rental apartment properties in Canada for an aggregate $387.4
million. CAPREIT also announced that it has closed on, or has
entered into an agreement to close on, three non-core Canadian
dispositions to non-profit organizations for combined gross
proceeds of $89.3 million. All amounts disclosed herein exclude
transaction costs and other customary adjustments.
During the second quarter of 2024, CAPREIT has
completed the acquisition of two strategically aligned
properties:
- The first purchase was one newly
built, 68-suite rental property located in downtown Halifax, Nova
Scotia. The concrete apartment building was constructed in 2019,
and was acquired in June for $29.4 million. CAPREIT assumed the
$14.3 million in mortgage principal outstanding, which subsequently
matured and was repaid in full.
- CAPREIT’s second acquisition in
June was another concrete, 178-suite high-rise apartment building
located in a coveted central neighbourhood in Edmonton, Alberta.
The premium property was built in 2023 and was purchased, following
lease-up, for $79.3 million. CAPREIT assumed the existing $68.6
million mortgage, which carries interest at 3.6% per annum for a
nine-year term to maturity (all rates disclosed herein refer to
stated interest rates).
In July, CAPREIT closed on four additional
acquisitions of high quality, recently constructed rental apartment
properties:
- The first was built in 2023, and
contains 54 modern residential suites located in Ottawa, Ontario.
The stabilized property was purchased for $21.0 million, and
CAPREIT assumed the existing $15.9 million mortgage, which carries
interest at 4.4% per annum for a term to maturity of four and a
half years.
- CAPREIT also acquired a high-rise
rental property containing 144 spacious residential suites, primely
located near downtown Ottawa, Ontario. The 20-storey, concrete
building was constructed in 2019 and purchased for $78.5 million.
CAPREIT assumed the $10.4 million mortgage, which carries a
below-market interest rate of 2.1% per annum for a remaining term
to maturity of two and a half years.
- CAPREIT completed a further
acquisition in July of one newly constructed property comprised of
173 modern, luxurious suites in West End, downtown Vancouver,
British Columbia (“BC”). The 21-storey building is situated by the
waterfront across from the Vancouver Harbour, providing exceptional
views of the bay, mountains and skyline. Residents enjoy a short
walk to the beach, park and downtown, as well as many easily
accessible public transit routes to within and outside of
Vancouver. The centrally located property was built in 2019, and
was acquired for a purchase price of $137.0 million. CAPREIT
assumed the existing $64.1 million mortgage, carrying interest at
3.1% per annum for an eight-year term to maturity.
- Lastly, CAPREIT purchased an
unencumbered 64-suite building located in a highly sought-after
community in North Vancouver, BC. The leased-up property was built
in 2023, and it was acquired for $42.2 million.
A Media Snippet accompanying this announcement
is available by clicking on this link.
CAPREIT further announced that it has completed
two dispositions of non-core properties during the second quarter
of 2024:
- In May, one 79-suite property in
Burnaby, BC, was sold for $33.0 million in gross consideration,
with the buyer having assumed the $7.9 million in mortgage
principal outstanding. The buyer was Catalyst Community Development
Society, a BC-based not-for-profit real estate developer focused on
affordable housing. The transaction was supported by funding from
the BC Rental Protection Fund.
- In June, CAPREIT completed the
disposition of 44 residential suites located in Maple Ridge, BC,
for $18.5 million, with the buyer having assumed the $9.7 million
in mortgage principal outstanding. The buyer was another local
not-for-profit organization focused on affordable housing, and the
transaction was supported by funding from the BC Rental Protection
Fund.
CAPREIT has also entered into an agreement to
sell one more off-strategy property, with closing anticipated by
release of its second quarter 2024 financial results on August 7,
2024:
- An unencumbered 138-suite building
located in Toronto, Ontario, is expected to be sold for $37.8
million to a local not-for-profit corporation named Scarlett View
Housing Corporation.
“We’re excited about the ground we’ve covered on
our high-grading strategy since our last update, with nearly $500
million in additional Canadian apartment transactions, and we still
have significant runway left in the year,” commented Mark Kenney,
President and Chief Executive Officer. “Notably, the weighted
average cap rate on our newly announced acquisitions exceeds that
of our dispositions, which we’re continuing to sell at prices that
are at or above their previously reported IFRS fair
values. We’re also proud to be participating in the
preservation of affordable housing in Canada by transferring more
of our regulated properties into the hands of non-profit
organizations, that can maintain the affordability of these older
homes for substantially less than the cost of building new. We’ll
continue incorporating this as a key strategic priority going
forward, so that we can further contribute to the solutions to the
Canadian housing crisis in this important way.”
“The Board is pleased with the advancements made
on CAPREIT’s strategy in 2024, and we applaud management’s
commitment to heighten portfolio quality and grow earnings for
Unitholders,” added Gina Cody, Chair of the Board of
Trustees. “Alongside our recently announced divestments from
other ancillary interests that are no longer core to our business,
we’re thrilled to be transforming CAPREIT’s future for the better.
The Board remains supportive of CAPREIT’s strategic objectives and
encourages continued momentum on those goals going forward.”
ABOUT CAPREITCAPREIT is
Canada’s largest publicly traded provider of quality rental
housing. As at March 31, 2024, CAPREIT owns approximately 64,200
residential apartment suites, townhomes and manufactured home
community sites well-located across Canada and the Netherlands,
with approximately $16.7 billion of investment properties in Canada
and Europe. For more information about CAPREIT, its business and
its investment highlights, please visit our website at
www.capreit.ca and our public disclosure which can be found under
our profile at www.sedarplus.ca.
CAUTIONARY STATEMENTS REGARDING
FORWARD-LOOKING STATEMENTSCertain statements contained in
this press release constitute forward-looking statements within the
meaning of applicable Canadian securities laws which reflect
CAPREIT’s current expectations and projections about future
results. 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”, “consider”, “should”, “plans”, “predict”,
“estimate”, “forward”, “potential”, “could”, “likely”,
“approximately”, “scheduled”, “forecast”, “variation” or
“continue”, or similar expressions suggesting future outcomes or
events. The forward-looking statements made in this press release
relate only to events or information as of the date on which the
statements are made in this press release. Actual results and
developments are likely to differ, and may differ materially, from
those expressed or implied by the forward-looking statements
contained in this press release. Any number of factors could cause
actual results to differ materially from these forward-looking
statements. Although CAPREIT believes that the expectations
reflected in forward-looking statements are reasonable, it can give
no assurances that the expectations of any forward-looking
statements will prove to be correct. Such forward-looking
statements are based on a number of assumptions that may prove to
be incorrect. Accordingly, readers should not place undue reliance
on forward-looking statements.
Forward looking statements in this press release
are subject to certain risks and uncertainties that could result in
actual results differing materially from these forward-looking
statements. These risks and uncertainties are more fully described
in regulatory filings that can be obtained on SEDAR+ at
www.sedarplus.ca.
Except as specifically required by applicable
Canadian securities law, CAPREIT does not undertake 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. These forward-looking
statements should not be relied upon as representing CAPREIT’s
views as of any date subsequent to the date of this press
release.
For more information, please
contact:
CAPREIT Dr. Gina Parvaneh CodyChair of the
Board (437) 219-1765 |
CAPREITMr. Mark
Kenney
President & Chief Executive
Officer (416)
861-9404 |
|
|
CAPREITMr. Stephen Co Chief Financial Officer(416)
306-3009 |
CAPREITMr. Julian SchonfeldtChief Investment Officer(647)
535-2544 |
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