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TORONTO, June 25, 2019 /CNW/ - Automotive Properties Real Estate Investment Trust (TSX: APR.UN) (the "REIT") announced today that it has completed the previously-announced acquisition of a portfolio of three automotive dealership properties from AutoCanada Inc. (TSX: ACQ) ("AutoCanada") for a total purchase price of approximately $30.4 million, excluding closing costs (the "Transaction").
The three dealership properties included in the Transaction are: the Abbotsford Volkswagen property, located at 30150 / 30195 Automall Drive in Abbotsford, British Columbia; the Guelph Hyundai property, located at 765 Woodlawn Road West in Guelph, Ontario; and the Wellington Motors property, a Chrysler dealership located at 935 Woodlawn Road West in Guelph, Ontario. Affiliates of AutoCanada are now the respective operating tenants of the Abbotsford Volkswagen, Guelph Hyundai and Wellington Motors dealerships, and each has entered into a 19-year, triple-net lease with the REIT. AutoCanada Holdings Inc. has provided an indemnity to the REIT in respect of the lease obligations for the three dealership properties included in the Transaction.
The REIT has initially funded the Transaction through draws on its existing revolving credit facilities and through the expansion of one of its non-revolving credit facilities ("Credit Facility 2") to approximately $102 million, representing an increase of $29.7 million. The REIT has entered into a $29.7 million interest rate swap for a 10-year term at an interest rate of 3.55%. Credit Facility 2's term has also been extended to June 2024.
The REIT intends to use a portion of the net proceeds from the REIT's previously-announced bought deal public offering of trust units of the REIT (the "Offering") to repay the debt incurred to fund the Transaction. Closing of the Offering is expected to occur on June 28, 2019 and is subject to customary conditions, including approval of the Toronto Stock Exchange.
The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
About Automotive Properties REIT
Automotive Properties REIT is an unincorporated, open-ended real estate investment trust focused on owning and acquiring primarily income-producing automotive dealership properties located in Canada. The REIT's portfolio currently consists of 60 income-producing commercial properties, representing more than two million square feet of gross leasable area, in metropolitan markets across British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Québec. Automotive Properties REIT is the only public vehicle in Canada focused on consolidating automotive dealership real estate properties. For more information, please visit: www.automotivepropertiesreit.ca
This news release contains forward-looking information within the meaning of applicable securities legislation, which reflects the REIT's current expectations regarding future events and in some cases can be identified by such terms as "will", "intends", "anticipates" and "expected". Forward-looking information includes statements regarding the Transaction and Offering. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the REIT's control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, the failure of the REIT to close the Offering and the factors discussed under "Risks and Uncertainties" in the REIT's management's discussion and analysis ("MD&A") most recently filed on SEDAR (www.sedar.com) and in the REIT's current annual information form, which is available on SEDAR. The REIT does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law. This forward-looking information speaks as of the date of this news release.
SOURCE Automotive Properties Real Estate Investment Trust
For further information: Bruce Wigle, Investor Relations, Bay Street Communications, Tel: 647-496-7856; Milton Lamb, President & CEO, Automotive Properties REIT, Tel: 647-789-2445; Andrew Kalra, CFO & Corporate Secretary, Automotive Properties REIT, Tel: 647-789-2446