WINNIPEG, May 3, 2016 /CNW/ - Lanesborough Real Estate Investment Trust ("LREIT") (TSX: LRT.UN) announced today that it has completed the sale of the following two properties, with an effective date of May 1, 2016:
- Willowdale Gardens, an 88-suite apartment property located in Brandon, Manitoba, was sold for $9 million. The sale resulted in net cash proceeds to LREIT, after repayment of the first mortgage loan and the standard closing costs and adjustments, of approximately $5.95 million. Willowdale Gardens was acquired by LREIT in 2006 for $4.3 million.
- Beck Court, a 120-suite apartment property located in Yellowknife, NWT, was sold for $23 million. The sale resulted in net cash proceeds to LREIT of approximately $3.4 million after the assumption by the purchaser of the existing first mortgage loan in the amount of $15.6 million and vendor take-back financing provided by LREIT in the amount of $4 million. The vendor take-back financing bears interest at 4%, with monthly interest only payments and a six-year term. Beck Court was acquired by LREIT in 2004 for $14.3 million.
The total net cash proceeds in the approximate amount of $9.35 million were used to fully repay a $5.4 million second mortgage loan, which had a secured charge on Willowdale Gardens, and to pay down the revolving loan by $3.95 million.
As part of the sale agreement for both properties, LREIT and the purchaser have agreed that, in the event that either property is re-sold within a 24-month period, LREIT will share equally in any profit that is realized as a result of such sale.
LREIT is a real estate investment trust, which is listed on the Toronto Stock Exchange under the symbols LRT.UN (Trust Units) and LRT.DB.G (Series G Debentures). For further information on LREIT, please visit our website at www.lreit.com.
The TSX has not reviewed or approved the contents of this press release and does not accept responsibility for the adequacy or accuracy of this press release.
SOURCE Lanesborough Real Estate Investment Trust
For further information: Arni Thorsteinson, Chief Executive Officer, or Gino Romagnoli, Investor Relations, Tel: (204) 475-9090, Fax: (204) 452-5505, Email: firstname.lastname@example.org