GREENWICH, Conn., Nov. 5 /CNW/ -- Mercury Real Estate Advisors LLC, an
affiliate of Mercury Partners LLC, a real estate investment management company
based in Greenwich, CT, sent the following letter today to IAT Air Cargo
Facilities Income Fund's (TSX: ACF.UN) Board of Trustees.
Mercury Real Estate Advisors LLC
Three River Road
Greenwich, CT 06807
November 5, 2007
Trustees - IAT Air Cargo Facilities Income Fund
Mr. Alvin G. Poettcker
Mr. Robert J. Mair, Q.C.
Mr. W. John Dawson
Mr. Anthony W. Ryan
Ms. Alison Hill
IAT Air Cargo Facilities Income Fund
2000-5000 Miller Road
Richmond, British Columbia V7B 1K6
We are writing in regards to our recent communication with IAT Air Cargo
Facilities Income Fund (the "Fund"), the limited purpose trust that owns all
of the shares of International Aviation Terminals Inc. ("IAT" or the
"Company"). We thank you for your response; however, to our dismay, we find
your comments unresponsive to the most critical issues set forth in our
letter. Moreover, these disingenuous remarks misrepresent the Fund's true
performance. The fact remains that the Fund is far too small to be public.
This is made painfully clear by the Company's total inability to realize its
growth potential, leaving investors to suffer from its egregious
In our opinion, the accomplishments you cite are not only trivial and
inadequate, but have yet to result in any positive impact on the unit price.
This is evident in the excessive discount to current liquidation value at
which the units trade. Not only are the units trading at a discount to net
asset value, but they are trading at an appalling 17% discount to their
original listing price of $10.00 over ten years ago on June 10, 1997!
Regarding your comments on the dividend distributions of the Fund, while the
actual amount paid in 2006 of $0.67 was higher than the annualized quarterly
rate of $0.15, the total distributions for 2006 remained approximately 18%
lower than those made in 2005. Also, the increase in the 2007 quarterly rate
to $0.17 from $0.15 in 2006 remains significantly below the average quarterly
rate of $0.20 paid in 2005. Finally, it is important to point out that
regardless of the 350 basis point increase in occupancy since September 30,
2005 occupancy levels as of June 30, 2007 are actually 280 basis points lower
than they were at the end of the same period in 2006. These shortcomings at
both the corporate and property level are a poor reflection of both IAT and
AMB Property Corp. (NYSE: AMB), the parent company of IAT's property manager,
AMB Property Canada Ltd. The assertion that the Company has "taken steps to
improve the business" is ludicrous. Unitholders hardly benefit from this "one
step forward, three steps back" style of management.
We steadfastly believe that an immediate exploration of strategic
alternatives is in the best interest of unitholders and insist the Board of
Trustees of the Fund urgently pursue this course of action. We appreciate
your willingness to meet with us to discuss our concerns and would like to
schedule a time as soon as possible. We look forward to meeting with you in
the near future.
MERCURY REAL ESTATE ADVISORS LLC
David R. Jarvis Malcolm F. MacLean IV
Chief Executive Officer President
For further information:
For further information: Malcolm F. MacLean IV, President of Mercury
Real Estate Advisors LLC, +1-203-769-2980