HALIFAX, June 15, 2011 /CNW/ - Killam Properties Inc. (TSX: KMP) is
pleased to announce acquisitions in New Brunswick totalling $50.4
million. The acquisitions include a total of 470 units in Fredericton
and Moncton and will increase Killam's total apartment portfolio to
10,196 units and will bring Killam's New Brunswick apartment portfolio
to 3,830 units, representing 38% of the total apartment portfolio.
On June 6, 2011, Killam closed the previously announced acquisition of a
six-building, 310-unit apartment portfolio in Fredericton. The
buildings are located within a block from each other, on Reynolds
Street (200, 300 and 305 Reynolds) and neighbouring McKnight Street
(25, 110 and 120 McKnight). The portfolio, built between 1996 and 2010,
contains 35 one-bedroom, 212 two-bedroom and 63 three-bedroom units.
The average rent is $931 per month, with tenants responsible for their
own heating costs. The purchase price of $36.1 million ($116,500 per
unit) was satisfied with $22.2 million in new and existing mortgages
with a weighted average interest rate of 4.3%, and the balance in cash.
The cap rate on the acquisition is approximately 6.2%.
Killam will acquire a three-building, 96-unit portfolio in Moncton. The
properties, 155 Canaan Street and 115 - 133 Kedgwick Street, were built
between 2008 and 2010. The buildings include 12 one-bedroom units, 81
two-bedroom units and 3 three-bedroom units, and have an average
monthly rent of $922 per month, with tenants responsible for their own
heating costs. The purchase price of $10.0 million ($104,200 per unit)
will be satisfied with the assumption of $7.2 million of existing debt
with a weighted average interest rate of 5.05% and the balance in
cash. The cap rate on the acquisition, expected to close during the
first week of July, is approximately 6.1%.
Killam will also acquire a two-building, 64-unit complex on Church
Street located in Moncton. The buildings include 64 two-bedroom units
with an average rent of $669 per month, with tenants responsible for
their own heating costs. The purchase price of $4.3 million ($67,000
per unit) will be satisfied with the assumption of an existing mortgage
of $2.6 million at 4.38%, and the balance in cash. The cap rate on the
acquisition, expected to close during the last week of June, is
"We are pleased to be expanding our portfolio of apartments in
Fredericton and Moncton, two of our core markets", noted Philip Fraser,
Killam's President and Chief Executive Officer. "In addition to
complementing our existing portfolios in each city, these properties
increase the percentage of Killam's apartment portfolio heated with
electricity, where Killam is not exposed to rising energy costs."
"We continue to have an active acquisition pipeline and look forward to
announcing additional acquisitions in the coming months as we grow our
business though expansion in our existing markets in Atlantic Canada
and in Ontario."
Killam Properties Inc, based in Halifax, Nova Scotia, is one of Canada's
largest residential landlords, owning and operating multi-family
apartments and manufactured home communities.
Note: The Toronto Stock Exchange has neither approved nor disapproved of
the information contained herein. Certain statements in this report
may constitute forward-looking statements relating to our operations
and the environment in which we operate, which are based on our
expectations, estimates, forecast and projections, which we believe are
reasonable as of the current date. Such forward-looking statements
involve risks, uncertainties and other factors which may cause actual
results, performance or achievements of Killam to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. For more
exhaustive information on these risks and uncertainties, you should
refer to our most recently filed annual information form which is
available at www.sedar.com. Readers, therefore, should not place undue
reliance on any such forward-looking statements. Further, a
forward-looking statement speaks only as of the date on which such
statement is made and should not be relied upon as of any other date.
Other than as required by law, Killam does not undertake to update any
of such forward-looking statements.
SOURCE KILLAM PROPERTIES INC.
For further information:
Killam Properties Inc.
Dale Noseworthy, CA, CFA
Vice President, Investor Relations & Corporate Planning
Phone: (902) 442-0388