TORONTO, Sept. 22, 2021 (GLOBE NEWSWIRE) -- Canadian Apartment Properties Real Estate Investment Trust (“CAPREIT”) (TSX:CAR.UN) announced today that it has acquired Tower Hill East, a superior-quality, luxury apartment building on St. Clair Avenue West in downtown Toronto, the sister to CAPREIT’s flagship property The Thomas. The 141 suites include 14 bachelor, 56 one-bedroom, 35 two-bedroom and 36 three-bedroom units with an extensive average suite size of 1,143 square feet. Located close to The Thomas, the purchase positions CAPREIT with a second iconic property in Toronto’s prestigious Forest Hill community. Historically at near 100% occupancy, at closing there were 15 vacant units. Management estimates current rents are approximately 30% below market.
The property was acquired for $110.0 million, with CAPREIT assuming a $34.0 million mortgage bearing a 1.93% interest rate maturing on December 1, 2021. The vendors elected to take 100% of the residual purchase price in CAPREIT Exchangeable LP Units at a price of $56.00 per Exchangeable LP Unit, saving CAPREIT the general underwriting commissions and market discounts associated with raising equity in the public markets resulting in approximately 8% savings.
The acquisition provides extensive management synergies and operational efficiencies between the two St. Clair Avenue properties, as well as solid upside as rents. In addition, future capital investments planned for the property, including LED lighting retrofits, new low-flow bathroom fixture installations, in-suite smart thermostats and a chiller replacement will significantly reduce energy consumption and contribute to CAPREIT’s goal of enhancing its environmental performance, including an estimated 40% reduction in natural gas usage.
“We are very proud to bring this prestigious downtown Toronto property into the CAPREIT family. Pairing these two iconic and well-known properties together under our experienced management team solidifies our presence as a leader in the GTA luxury rental market,” commented Mark Kenney, President and CEO. “We are also pleased that the property, and the planned value-add investments we will be making in it, will contribute to enhanced resident safety, reduced operating costs, and help us meet our ESG goals.”
CAPREIT is Canada's largest publicly-traded provider of quality rental housing. CAPREIT currently owns or has interests in approximately 70,000 residential apartment suites, townhomes and manufactured housing community sites well-located across Canada, in the Netherlands and Ireland with approximately $18 billion of assets under management globally. For more information about CAPREIT, its business and its investment highlights, please visit our website at www.caprent.com or www.capreit.net and our public disclosure which can be found under our profile at www.sedar.com.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS
All statements in this press release that do not relate to historical facts constitute forward-looking statements. These statements represent CAPREIT's intentions, plans, expectations and beliefs and are subject to certain risks and uncertainties that could result in actual results differing materially from these forward-looking statements. These risks and uncertainties are more fully described in regulatory filings that can be obtained on SEDAR at www.sedar.com.
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