TORONTO, Feb. 16, 2017 /CNW/ - Summit Industrial Income REIT ("Summit" or the "REIT") (TSX: SMU.UN) announced today that it has completed the acquisition of a 120,690 square foot light industrial property in Calgary, Alberta for a purchase price of $17.0 million. Located close to other Summit-owned assets, the property is 100% occupied by two quality tenants with a weighted average lease term of 7.7 years and is near major rail and highway transportation links. The acquisition was financed indirectly with proceeds from the REIT's bought-deal equity offering which closed on January 31, 2017 (the "Equity Offering"). The REIT expects to place an $11.2 million five-year mortgage on the property with a 3.00% fixed interest rate.
In addition, Summit has waived conditions on acquiring an additional 260,830 square foot property in the Greater Toronto Area for an expected purchase price of $28.2 million. The purchase is expected to be satisfied by a new $17.7 million five-year mortgage bearing an interest rate set at the five-year Government of Canada Bonds plus 1.9%, with the balance to be financed indirectly with proceeds from the Equity Offering. The property is 100% occupied by a single quality tenant with a remaining lease term of twelve years. Closing of the transaction is expected to occur on or before February 28, 2017.
"With the completion of these transactions, we will have invested a significant portion of the proceeds from our recently-completed $46.0 million bought-deal equity offering in income-producing properties," commented Paul Dykeman, Chief Executive Officer. "These new properties will strengthen our presence in key target markets, contributing to further cost synergies and economies of scale in our property management activities. Additionally, we are currently performing due diligence on two more properties and our pipeline has grown significantly. We are currently evaluating a number of additional acquisitions that should lead to further strong portfolio growth through the balance of 2017."
Summit Industrial Income REIT is an unincorporated open-end trust focused on growing and managing a portfolio of light industrial properties across Canada. Summit's units are listed on the TSX and trade under the symbol SMU.UN. For more information, please visit our web site at www.summitIIreit.com.
Caution Regarding Forward Looking Information
This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "goal" and similar expressions are intended to identify forward-looking information or statements. Forward-looking information may relate to future results, performance, achievements, events, prospects or opportunities for the REIT or the real estate industry, outlook and anticipated events or results. Some of the specific forward-looking statements contained herein include statements with respect to the following: the intention of Summit to complete the property acquisitions described herein on the terms and conditions described; the expected benefits of the property acquisitions described herein to Summit; and Summit's pursuit and completion of future acquisitions.
Forward-looking statements necessarily involve known and unknown risks and uncertainties, which may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, assumptions may not be correct and objectives, strategic goals and priorities may not be achieved. A variety of factors, many of which are beyond the REIT's control, affect the operations, performance and results of the REIT and its business, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results. These factors include, but are not limited to, the risks discussed in the REIT's materials filed with Canadian securities regulatory authorities from time to time on www.sedar.com. The reader is cautioned to consider these and other factors, uncertainties and potential events carefully as there can be no assurance actual results will be consistent with such forward-looking statements.
Information contained in forward-looking statements is based upon certain material assumptions that were applied in drawing a conclusion or making a forecast or projection, including management's perceptions of historical trends, current conditions and expected future developments, as well as other considerations that are believed to be appropriate in the circumstances will not have a material impact on the REIT. While management considers these assumptions to be reasonable based on currently available information, they may prove to be incorrect.
Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward looking information for anything other than its intended purpose. Summit undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
SOURCE Summit Industrial Income REIT
For further information: Paul Dykeman, CEO at (902) 405-8813, firstname.lastname@example.org