TORONTO, May 31, 2019 /CNW/ - European Residential Real
Estate Investment Trust (TSX-V:ERE.UN, "ERES") and Canadian
Apartment Properties Real Estate Investment Trust (TSX:CAR.UN,
"CAPREIT") are pleased to announce the closing of the
previously announced acquisition (the "Transaction") by ERES
from CAPREIT of a portfolio (the "Warehoused Portfolio")
comprised of 26 properties, representing an aggregate of 1,257
residential suites and certain additional ancillary commercial
space and parking facilities, located in 24 cities and towns across
the Netherlands, as more
particularly described in ERES's management information circular
dated April 23, 2019 (the
"Circular"). The purchase price for the Warehoused Portfolio
of approximately €232 million, subject to certain post-closing
purchase price adjustments, was satisfied by a combination of: (i)
the assumption of approximately €97 million aggregate principal
amount of existing mortgage debt net of financing fees associated
with the Warehoused Portfolio, bearing a weighted average 1.98%
fixed interest rate and a weighted average 6.6 year term to
maturity; and (ii) the issuance of 50,582,631 class B LP units of
ERES Limited Partnership (the "Class B LP Units"), a
subsidiary of ERES, at a price of C$4.00 per Class B LP Unit, in the aggregate
amount of approximately €135 million. The Class B LP Units are
convertible on a one-to-one basis into trust units of ERES
("Units").
The Transaction was completed pursuant to the previously
announced pipeline agreement dated March 29,
2019 between ERES and CAPREIT Limited Partnership, which was
approved by the holders of units and special voting units of ERES
at a special meeting held on March 21,
2019.
The issuance of Class B LP Units in connection with the
Transaction was overwhelmingly approved by disinterested
unitholders of ERES at ERES' annual and special meeting held on
May 23, 2019. As a result of the
Transaction, ERES's the value of investment properties has
increased from approximately €530 million to approximately €770
million, consisting of 3,348 multi-residential suites in 67
properties and approximately 400,000 square feet of gross leasable
office area in three commercial properties. ERES's market
capitalization has also increased significantly, with the number of
Units outstanding (including Class B LP Units) increasing from
approximately 99 million to approximately 150 million.
CAPREIT's Ownership
As a result of the Transaction, CAPREIT beneficially owns,
controls or exercises direction over 132,223,841 Class B LP Units,
representing approximately 88% of the issued and outstanding Units,
on a fully diluted basis. Immediately before the completion of the
Transaction, CAPREIT owned, controlled or exercised direction over
81,641,210 Class B LP Units, representing approximately 83% of the
issued and outstanding Units, on a fully diluted basis. Subject to
the terms set out in the investor rights agreement dated
March 29, 2019 between CAPREIT and
ERES, CAPREIT may seek to sell or otherwise dispose of some or all
of ERES' securities (which may include, but is not limited to,
transferring some or all of such securities to its affiliates) from
time to time, and/or may seek to acquire additional securities of
ERES (which may include rights or securities exercisable or
convertible into securities of ERES) from time to time, in each
case, in open market or private transactions, block sales or
acquisitions or otherwise.
This press release is issued pursuant to the early warning
requirements of National Instrument 62-103, which also requires a
report to be filed containing additional information with respect
to the foregoing matters (the "Early Warning Report"). A
copy of the Early Warning Report will appear under ERES' profile on
the SEDAR website at www.sedar.com.
About ERES
ERES is an unincorporated, open-ended real estate investment
trust. ERES' Units are listed on the TSX-V under the symbol ERE.UN.
ERES is Canada's only
European-focused multi-residential REIT, with a current initial
focus on investing in high-quality multi-residential real estate
properties in the Netherlands.
ERES owns a portfolio of 67 multi-residential properties, comprised
of 3,348 suites located in the
Netherlands, and owns two office properties in Germany and one office property in
Belgium.
ERES' registered and principal business office is located at 11 Church Street, Suite 401, Toronto, Ontario
M5E 1W1.
For more information, please visit our website
at www.eresreit.com.
About CAPREIT
As one of Canada's largest
residential landlords, CAPREIT is a growth-oriented investment
trust owning interests in 56,042 residential units, comprising
44,373 residential suites and 72 manufactured home communities
comprising 11,669 sites located in and near major urban centres
across Canada and The Netherlands.
CAPREIT's registered and principal business office is located at
11 Church Street, Suite 401, Toronto,
Ontario M5E 1W1.
For more information about CAPREIT, its business and its
investment highlights, please refer to our website at
www.caprent.com or www.capreit.net and our public disclosure, which
can be found under our profile at www.sedar.com.
Cautions Regarding Future Plans and
Forward-Looking Information
Certain statements contained in this press release constitute
forward-looking statements within the meaning of applicable
Canadian securities laws which reflect ERES'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", "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. Such forward-looking
statements are based on a number of assumptions that may prove to
be incorrect.
Except as specifically required by applicable Canadian
securities law, ERES 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 ERES' views as of any date
subsequent to the date of this press release. There can be no
assurance that forward-looking statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on
forward-looking statements.
Investors are cautioned that, except as disclosed in the
Circular, any information released or received with respect to the
Transaction may not be accurate or complete and should not be
relied upon.
Neither the TSX-V nor its Regulation Services Provider (as that
term is defined in the policies of the TSX-V) have in no way
passed upon the merits of the Transaction and have neither approved
nor disapproved the contents of this news release.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities of ERES.
SOURCE European Residential Real Estate Investment Trust