WINNIPEG, May 1, 2014 /CNW/ - Temple Hotels Inc. ("Temple") (TSX: TPH) announced today that it has completed the acquisition an extended-stay property in the Timberlea area of Fort McMurray, AB (the "Property") for $26 million, subject to the customary closing adjustments. The four-storey Property consists of 57 two-bedroom, furnished suites, with a 90-stall underground parkade and additional surface parking. The Property is the adjacent sister property of the Clearwater Residence Hotel - Timberlea, Temple's other extended-stay hotel in the Timberlea area of north Fort McMurray.
The $26 million acquisition price was financed with a first mortgage loan in the amount of $19 million and the balance in cash. The first mortgage loan bears interest at a rate of 4.25% with a 20-year amortization. The effective closing date of the acquisition was as of April 1, 2014.
The Property is 100% leased until April 30, 2018 on a triple net basis to a major oil-sands company. Based on the in-place lease terms for 2014, the acquisition price of $26 million represents an approximate capitalization rate of 8.2%, which will increase to approximately 9% based on the lease payments which come into effect on May 1, 2016.
The Property will operate as Cortona Residence until it is expected to become an expanded component of the Clearwater Residence Hotel - Timberlea in 2018.
Temple is a real estate investment company listed on the Toronto Stock Exchange under the symbols TPH (common shares), TPH.DB.C, TPH.DB.D, TPH.DB.E and TPH.DB.F (convertible debentures). The objective of Temple is to provide shareholders with stable cash dividends from investment in a diversified portfolio of hotel properties and related assets. For further information on Temple, please visit our website at www.templehotels.ca.
This press release contains certain statements regarding the proposed transaction described herein that could be considered as forward-looking information. The forward-looking information is subject to certain risks and uncertainties, which could result in actual results differing materially from the forward-looking statements. There can be no certainty that the transaction will be completed within the timeline set forth herein or all at.
The Toronto Stock Exchange has not reviewed or approved the contents of this press release and does not accept responsibility for the adequacy or accuracy of this press release.
SOURCE: Temple Hotels Inc.
For further information:
Arni Thorsteinson, Chief Executive Officer, or Gino Romagnoli, Executive Vice President
Tel: (204) 475-9090, Fax: (204) 452-5505, Email: [email protected]