H&R Real Estate Investment Trust Closes Over-Allotment Option for an Additional $15 Million Principal Amount of Convertible Unsecured Subordinated Debentures


    TORONTO, June 12 /CNW/ - H&R Real Estate Investment Trust ("H&R")
(TSX: HR.UN) (TSX: HR.DB) announced today that it has closed the
over-allotment option to purchase an additional $15 million principal amount
of 6.65% convertible unsecured subordinated debentures that mature on June 30,
2013 (the "Debentures") previously granted to the syndicate of underwriters
led by CIBC World Markets Inc. and RBC Capital Markets, and including Scotia
Capital Inc., BMO Nesbitt Burns Inc., TD Securities Inc., Canaccord Capital
Corporation and Desjardins Securities Inc. in connection with H&R's recently
completed offering of 8,734,250 trust units and $100 million principal amount
of Debentures, bringing the cumulative aggregate gross proceeds to H&R from
the offering to approximately $287.5 million.
    The securities have not been, nor will be, registered under the United
States Securities Act of 1933, as amended, and may not be offered or sold in
the United States absent registration or applicable exemption from the
registration requirement of such Act.

    About H&R

    H&R REIT is a TSX-listed, open-ended real estate investment trust, which
owns a North American portfolio of 35 office, 124 industrial and 140 retail
properties comprising approximately 44.1 million square feet, with a net book
value of $4.7 billion. The foundation of H&R's success is a disciplined
strategy that leads to consistent and profitable growth.
    Additional information regarding H&R REIT is available at 

    Certain information in this news release may contain forward-looking
statements within the meaning of applicable securities laws, including, among
others, statements relating to H&R's objectives, strategies to achieve those
objectives, H&R's beliefs, plans, estimates and intentions, and similar
statements concerning anticipated future events, results, circumstances,
performance or expectations that are not historical facts. Forward-looking
statements generally can be identified by words such as "outlook",
"objective", "may", "will", "expect", "intend", "estimate", "anticipate",
"believe", "should", "plans" or "continue" or similar expressions suggesting
future outcomes or events. Such forward-looking statements reflect H&R's
beliefs and are based on information currently available to management.
Forward-looking statements are provided for the purpose of presenting
information about management's current expectations and plans relating to the
future and readers are cautioned that such statements may not be appropriate
for other purposes. These statements are not guarantees of future performance
and are based on H&R's estimates and assumptions that are subject to risks and
uncertainties, including those described under "Risk Factors" in the Final
Prospectus and those discussed in H&R's materials filed with the Canadian
securities regulatory authorities from time to time, which could cause the
actual results and performance of H&R to differ materially from the
forward-looking statements contained in this news release. These risks and
uncertainties include, among other things, risks related to: H&R trust unit
prices; availability of cash for distributions; development and financing
relating to the Bow development; credit risk and tenant concentration;
interest rate and other debt related risks; tax risk; ability to access
capital markets; dilution; lease rollover risk; construction risks; real
property ownership; currency risk; government regulation; investment
eligibility; unitholder liability; co-ownership interest in properties;
dependence on key personnel; mezzanine financing credit risk; competition for
real property investments; influence of H&R Property Management Ltd. over H&R;
potential conflicts of interest; redemption right; statutory remedies; the tax
position and consequence unique to each holder of H&R trust units; the
proposed reorganization involving H&R; the failure to obtain all approvals
required to implement the proposed reorganization; no market for the
Debentures; credit risk and prior ranking indebtedness; absence of covenant
protection; conversion following certain transactions; value of conversion
privilege; redemption prior to maturity; inability of H&R to purchase
debentures on a change of control; and dilutive effects on holders of H&R
trust units in the event of the redemption of Debentures. Material factors or
assumptions that were applied in drawing a conclusion or making an estimate
set out in the forward-looking statements include that the general economy
remains stable; interest rates are relatively stable; equity and debt markets
continue to provide access to capital; and the information utilized by H&R to
determine the tax consequences of the proposed reorganization to H&R and its
unitholders is accurate and remains unchanged. H&R cautions that this list of
factors is not exhaustive. Although the forward-looking statements contained
in this news release are based upon what H&R believes are reasonable
assumptions, there can be no assurance that actual results will be consistent
with these forward-looking statements. All forward-looking statements in this
news release are qualified by these cautionary statements. The forward-looking
statements are made only as of the date that such statements are made and H&R,
except as required by applicable law, assumes no obligation to update or
revise them to reflect new information or the occurrence of future events or

For further information:

For further information: Larry Froom, Chief Financial Officer, Phone:
(416) 635-7520, Email: info@hr-reit.com

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