Artis REIT announces disposition of two Calgary office properties and three new acquisitions

    WINNIPEG, July 31 /CNW/ - Artis Real Estate Investment Trust ("Artis" or
the "REIT") announced today that it has entered into an unconditional
agreement to sell two class "B" commercial suburban office properties in
Calgary, Alberta. The transaction is expected to close at the end of August of
this year. The REIT also announced that it has entered into conditional and
unconditional agreements to acquire two office properties in B.C. and a class
"A" flex/industrial property in Calgary.
    The two suburban office properties subject to sale - Airways Business
Plaza and Glenmore Commerce Court - will be sold for an aggregate sales price
of $24.9 million, representing a capitalization rate of approximately 6.3%.
Artis has owned these properties for three years and one year, respectively,
and expects to record a before tax gain on sale in Q3-08 of approximately
$6.5 million (approximately $0.20 per unit based on today's issued and
outstanding units). Net proceeds of approximately $12.2 million are
anticipated to be realized on the transaction.
    "The investment market for Calgary office property has remained strong
through the first half of 2008. This has presented us with an excellent
opportunity to realize gains on selected assets while partially repositioning
our portfolio in terms of asset class and geographical location," said
Armin Martens, Chief Executive Officer of Artis REIT. "We expect that the cash
generated from these dispositions will be redeployed in class "A" Calgary
industrial properties and in B.C. office properties, increasing our weighting
in those markets."

    New Acquisitions:

    Artis has entered into an unconditional agreement to acquire 1930
Maynard, a 153,000 square foot Class "A" industrial technology building in the
Mayland Commercial Park in Calgary. The estimated going-in cash capitalization
rate (the "cap rate") on the $36.4 million purchase price is 6.6% and
management estimates that in-place rents are currently 16% below market. 1930
Maynard is 100% occupied by four high-profile tenants - Bell Canada, Siemens
Canada, Q9 Networks and Ledcor Developments, with a weighted average remaining
lease term of 8.0 years. The acquisition is expected to close in Q3-08. Artis
has secured a commitment for a $24.0 million mortgage, five year term, bearing
an interest rate of 5.4% per annum (based on today's interest rates); the
balance of the purchase price will be satisfied with cash on hand and other
    Artis has also entered into an unconditional agreement to acquire a
47,000 square foot class "A" office building in Burnaby, B.C. The three-storey
Burnaby office building is well located in a park-like setting in the
Willingdon Green Executive Park, with excellent exposure and access to Highway
No.1. The property has a parking ratio of 3.14 stalls per 1,000 square feet,
including 67 underground stalls. The estimated cap rate on the $11.5 million
purchase price is approximately 7.2% and the acquisition is expected to close
in Q3-08. Artis has secured a commitment for $7.7 million financing bearing
interest at a rate of 5.5% per annum (based on today's interest rates); the
balance of the purchase price will be satisfied with cash on hand.
    Artis has also entered into a conditional agreement to acquire a well
located three-storey, 38,000 square foot office building in Victoria B.C. at
an estimated cap rate of 8.2%. The acquisition is anticipated to close in
Q3-08 and the $8.8 million purchase price will be financed with a combination
of mortgage financing and cash on hand. Artis has secured a commitment for a
$5.2 million five-year mortgage bearing interest at a rate of 5.5% per annum
(based on today's interest rates).
    To see charts detailing Artis REIT's Current portfolio weighting and
Portfolio weighting post closings and repositioning, please visit the
following URL:

    Artis is a growth-oriented real estate investment trust focused
exclusively on commercial properties located in primary and growing secondary
markets in western Canada, particularly in Alberta. The REIT's goal is to
provide Unitholders the opportunity to invest in high-quality western Canadian
office, retail and industrial properties, as well as to provide monthly cash
distributions that are stable, tax efficient, and growing over time.
    Including all of the completed and proposed acquisitions and
dispositions, Artis will own approximately $1.3 billion of commercial
property, comprising approximately 6.4 million square feet of leasable area in
87 properties. Leasable area will be approximately 30.1% in Manitoba, 7.7% in
Saskatchewan, 55.4% in Alberta, and 6.8% in B.C.; by asset class the portfolio
will be 32.4% retail, 40.2% office and 27.4% industrial.
    The REIT's Distribution Reinvestment Plan ("DRIP") allows Unitholders to
have their monthly cash distributions used to purchase trust units without
incurring commission or brokerage fees, and receive bonus units equal to 4% of
their monthly cash distributions. More information can be obtained at

    This press release contains forward-looking statements. For this purpose,
any statements contained herein that are not statements of historical fact may
be deemed to be forward-looking statements. Without limiting the foregoing,
the words "expects", "anticipates", "intends", "estimates", "projects", and
similar expressions are intended to identify forward-looking statements. Artis
is subject to significant risks and uncertainties which may cause the actual
results, performance or achievements of the REIT to be materially different
from any future results, performance or achievements expressed or implied in
these forward-looking statements. Such risk factors include, but are not
limited to, risks associated with real property ownership, availability of
cash flow, general uninsured losses, future property acquisitions,
environmental matters, tax related matters, debt financing, unitholder
liability, potential conflicts of interest, potential dilution, reliance on
key personnel, changes in legislation and changes in the tax treatment of
trusts. Artis cannot assure investors that actual results will be consistent
with any forward-looking statements and Artis assumes no obligation to update
or revise such forward-looking statements to reflect actual events or new
circumstances. All forward-looking statements contained in this press release
are qualified by this cautionary statement.

    The Toronto Stock Exchange does not accept responsibility for the
    adequacy or accuracy of this press release.

For further information:

For further information: Mr. Armin Martens, President and Chief
Executive Officer, Mr. Jim Green, Chief Financial Officer, or Ms. Kirsty
Stevens, Senior Vice President - Investor Relations, (204) 947-1250

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