Boardwalk REIT agrees to sell a 641-unit apartment portfolio in Regina, Saskatchewan to Mainstreet Equity Corporation
Boardwalk Real Estate Investment Trust ("BEI.UN" - TSX)
Mainstreet Equity Corporation ("MEQ" – TSX)
CALGARY, Dec. 13, 2017 /PRNewswire/ - Boardwalk Real Estate Investment Trust ("Boardwalk", "The Trust") is pleased to announce the sale of a 641-unit apartment portfolio in Regina, Saskatchewan formally known as Boardwalk Estates to Mainstreet Equity Corporation ("Mainstreet") for $71.65 million, which includes approximately 2 acres of residual land and a warehouse.
The sale price represents a price per door of approximately $112,000 and is inline with the fair value of these assets as recorded on Boardwalk's balance sheet as of September 30, 2017.
Mainstreet will assume the existing first mortgage of approximately $24.37 million at an interest rate of 2.19%. In addition, Boardwalk will provide a Vendor-Take-Back mortgage in the amount of $38.76 million at an annual interest rate of 2.19% for a period not exceeding two years.
Sam Kolias; Chairman and Chief Executive Officer of Boardwalk REIT commented: "Mainstreet has been a valued strategic partner for nearly two decades and we are excited to continue our long-standing relationship with the sale of our Boardwalk Estates portfolio in Regina. The Trust had identified these assets as non-core given the size of each asset and the varying locations within the portfolio, and is consistent with the Trust's strategy of high-grading its portfolio by investing in new construction such as our Pines Edge Communities in Regina. The continuation of our strategic partnership with Mainstreet has provided a win-win relationship where Mainstreet is able to further enhance value in providing high-quality mid-market apartments, while also providing Boardwalk strategic divestment opportunities."
Rob Geremia; President of Boardwalk REIT added: "We are pleased with the sale transaction which is inline with our fair value for the asset despite the current vacancy and incentive opportunity which is currently in place. The VTB provides the Trust with additional income, while balancing the near-term capital needs within the Boardwalk Estates portfolio. The Trust anticipates that it will be able to retain all of the net proceeds from this sale to utilize towards Boardwalk's strategic plan."
Bob Dhillon; President of Mainstreet Equity Corporation said: "Our strategic partnership with Boardwalk began nearly two decades ago with transactions in Edmonton, Calgary and the Lower Mainland of British Columbia, and continues with the acquisition of this 641-apartment unit portfolio in Regina, Saskatchewan, which represents an opportunity for Mainstreet to expand into the Regina market. This portfolio is ideal for Mainstreet to position itself to further create value by providing its strong and consistent brand of mid-market, renovated suites coupled with a high level of customer service."
The transaction is scheduled to close on December 14, 2017.
Table Summary and Address List:
| Property |
||||||||
| Type |
Year Built |
# Units |
Total Sq Ft |
Sale Price |
Price/Door |
|||
| Boardwalk Estates South |
Walk-up, Townhouse |
1950-60 |
537 |
372,956 |
$ |
61,886,000 |
$ |
115,000 |
| Boardwalk Estates Central |
Walk-up |
1960 |
46 |
26,060 |
$ |
4,013,000 |
$ |
87,000 |
| Boardwalk Estates North |
Walk-up |
1957 |
12 |
8,400 |
$ |
1,347,000 |
$ |
112,000 |
| Boardwalk Estates West |
Walk-up |
1950-60 |
46 |
27,640 |
$ |
4,401,000 |
$ |
96,000 |
| Boardwalk Estates Portfolio |
TOTAL |
641 |
435,056 |
$ |
71,647,000 |
$ |
112,000 |
|
| Building Address |
# Suites |
Building Address |
# Suites |
|||
| Boardwalk Estates South |
Boardwalk Estates South (Con't) |
|||||
| 1) |
2805 Parliament Avenue |
22 |
28) |
4040 Rae Street |
6 |
|
| 2) |
2821 Parliament Avenue |
23 |
29) |
4049 Retallack Street |
12 |
|
| 3) |
2835 Parliament Avenue |
23 |
30) |
4050 Rae Street |
12 |
|
| 4) |
2915 Parliament Avenue |
26 |
31) |
4064 Rae Street |
6 |
|
| 5) |
2924 Parliament Avenue |
22 |
32) |
4076 Rae Street |
12 |
|
| 6) |
2935 Parliament Avenue |
23 |
33) |
4100 Retallack Street |
35 |
|
| 7) |
3015 Parliament Avenue (Land) |
0 |
34) |
4110 Rae Street |
12 |
|
| 8) |
3025 Parliament Avenue |
18 |
35) |
4114 Rae Street |
4 |
|
| 9) |
3026 Parliament Avenue |
12 |
36) |
4120 Retallack Street |
18 |
|
| 10) |
3823 Retallack Street |
12 |
37) |
4122 Rae Street |
4 |
|
| 11) |
3854 Rae Street |
12 |
38) |
4130 Rae Street |
4 |
|
| 12) |
3864 Rae Street |
12 |
39) |
4140 Rae Street |
4 |
|
| 13) |
3900 Rae Street |
12 |
40) |
4150 Rae Street |
8 |
|
| 14) |
3918 Rae Street |
12 |
41) |
4160 Rae Street |
4 |
|
| 15) |
3929 Retallack Street |
8 |
42) |
4166 & 4168 Rae Street |
2 |
|
| 16) |
3930 Rae Street |
6 |
43) |
4145 Retallack Street (Land/Warehouse) |
0 |
|
| 17) |
3940 Retallack Street |
12 |
Boardwalk Estates Central |
|||
| 18) |
3941 Retallack Street |
8 |
44) |
2121 Smith Street |
23 |
|
| 19) |
3954 Rae Street |
12 |
45) |
2155 Rose Street |
23 |
|
| 20) |
3954 Retallack Street |
12 |
Boardwalk Estates North |
|||
| 21) |
3955 Retallack Street |
12 |
46) |
801 Grey Street |
12 |
|
| 22) |
3955 Robinson Street |
12 |
Boardwalk Estates West |
|||
| 23) |
4019 Retallack Street |
18 |
47) |
1520 Alexandra Street |
22 |
|
| 24) |
4020 Robinson Street |
29 |
48) |
1538 Alexandra Street |
12 |
|
| 25) |
4029 Retallack Street |
12 |
49) |
1544 Alexandra Street |
12 |
|
| 26) |
4030 Rae Street |
12 |
641 |
|||
| 27) |
4039 Retallack Street |
12 |
||||
Corporate Profile
Boardwalk REIT:
Boardwalk REIT strives to be Canada's friendliest communities and currently owns and operates more than 200 communities with over 33,000 residential units totaling over 28 million net rentable square feet. Boardwalk's principal objectives are to provide its Residents with the best quality communities and superior customer service, while providing Unitholders with sustainable monthly cash distributions, and increase the value of its trust units through selective acquisitions, dispositions, development, and effective management of its residential multi-family communities. Boardwalk REIT is vertically integrated and is Canada's leading owner/operator of multi-family communities with 1,800 Associates bringing Residents home to properties located in Alberta, Saskatchewan, Ontario, and Quebec.
Boardwalk REIT's Trust units are listed on the Toronto Stock Exchange, trading under the symbol BEI.UN. Additional information about Boardwalk REIT can be found on the Trust's website at www.BoardwalkREIT.com.
Mainstreet Equity Corporation:
Mainstreet Equity Corp. is a publicly traded (TSX: MEQ) residential real estate company in Canada. Since 2000, Mainstreet has grown its portfolio from 272 units with a market value of approximately $17 million to 11,185 units (YTD) and approximately $1.7 billion market value. Mainstreet positions itself as a value creator by purchasing under-performing properties, renovating them to a branded standard, improving operating efficiencies and repositioning them in the market for greater returns. Mainstreet currently owns and operates properties in Surrey, BC; New Westminster, BC; Abbotsford, BC; Calgary, AB; Cochrane, AB; Edmonton, AB; Lethbridge, AB; Fort Saskatchewan, AB; and Saskatoon, SK.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS
Information in this news release that is not current or historical factual information may constitute forward-looking information within the meaning of securities laws. Implicit in this information, particularly in respect of Boardwalk's objectives for 2017 and future periods, Boardwalk's strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations are estimates and assumptions subject to risks and uncertainties, including those described in the Management's Discussion & Analysis of Boardwalk REIT's 2016 Annual Report under the heading "Risks and Risk Management", which could cause Boardwalk's actual results to differ materially from the forward-looking information contained in this news release. Specifically, Boardwalk has assumed that the general economy remains stable, interest rates are relatively stable, acquisition capitalization rates are stable, competition for acquisition of residential apartments remains intense, and equity and debt markets continue to provide access to capital. These assumptions, although considered reasonable by the Trust at the time of preparation, may prove to be incorrect. For more exhaustive information on these risks and uncertainties you should refer to Boardwalk's most recently filed annual information form, which is available at www.sedar.com. Forward-looking information contained in this news release is based on Boardwalk's current estimates, expectations and projections, which Boardwalk believes are reasonable as of the current date. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While the Trust may elect to, Boardwalk is under no obligation and does not undertake to update this information at any particular time.
SOURCE Boardwalk Real Estate Investment Trust
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