H&R REIT announces completion of plan of arrangement



    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES/

    TSX SYMBOL: HR.UN

    TORONTO, Oct. 1 /CNW/ - H&R Real Estate Investment Trust (the "REIT")
(TSX: HR.UN) announced today that the internal reorganization (the
"Reorganization") of the REIT, which was approved by the REIT's unitholders at
a special meeting on September 19, 2008, has been successfully completed. The
Reorganization was approved by the Court of Queen's Bench of Alberta on
September 26, 2008.

    
    The Reorganization has resulted in the following:

      (i)  the completion of certain transactions in the course of which each
           unitholder received, for each REIT unit held, a unit of a
           "sister" trust ("H&R Finance Trust"). Each issued and outstanding
           REIT unit now trades together with a unit of H&R Finance Trust as
           a "Stapled Unit" on the Toronto Stock Exchange under the symbol
           HR.UN; and

      (ii) the completion of certain transactions whereby H&R TT (LP) Inc., a
           wholly-owned subsidiary of the REIT, ultimately transferred all of
           its assets (which primarily consisted of an interest in a
           partnership that holds the Telus Tower in Calgary, Alberta) to the
           REIT.
    

    As described in more detail in the management information circular of the
REIT dated August 20, 2008 (the "Circular"), Part XIII.2 of the Income Tax Act
(Canada) (the "Tax Act") imposes a tax on each holder of REIT units that is
neither a person resident in Canada for purposes of the Tax Act nor a
"Canadian partnership" for purposes of the Tax Act (a "Non-Resident Holder")
equal to 15% of the fair market value of the units of H&R Finance Trust
distributed to such Non-Resident Holder at the time of their distribution. It
is estimated that each unit of H&R Finance Trust had a fair market value of
approximately $0.91 at the effective time of the Reorganization, and therefore
Part XIII.2 non-resident withholding tax of approximately $0.14 is required to
be withheld in respect of each unit of H&R Finance Trust distributed to
Non-Resident Holders. As described in the Circular, registered REIT
unitholders who do not complete and deliver a letter of transmittal, as mailed
to registered unitholders of the REIT with the Circular, in accordance with
the instruction set out therein, on or prior to October 31, 2008, will be
treated by the REIT as Non-Resident Holders for purposes of remittance by the
REIT of non-resident withholding tax under the Tax Act (including, for the
avoidance of doubt, tax under Part XIII.2 of the Tax Act). Non-Resident
Holders are encouraged to consult their broker or investment adviser with
regard to arrangements for remittance of any applicable Part XIII.2
non-resident withholding tax. Unitholders are encouraged to review in detail
the management information circular of the REIT dated August 20, 2008 for more
information.

    About H&R REIT

    The REIT is a TSX-listed, open-ended real estate investment trust, which
owns a North American portfolio of 34 office, 124 industrial and 129 retail
properties comprising 43 million square feet, with a net book value of
$4.4 billion. The foundation of the REIT's success is a disciplined strategy
that leads to consistent and profitable growth.

    Additional information regarding the REIT is available on the REIT's
website at: www.hr-reit.com.




For further information:

For further information: Larry Froom, Chief Financial Officer, H&R REIT,
(416) 635-7520


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