CAPREIT to Acquire Apartment Portfolio in the Netherlands
Capitalizing on Success in Ireland to Further Diversify Portfolio
TORONTO, ONTARIO--(Marketwired - Dec. 22, 2016) - Canadian Apartment Properties Real Estate Investment Trust ("CAPREIT") (TSX:CAR.UN) announced today that it will acquire a portfolio of 568 residential apartment suites and townhomes in eight properties in The Netherlands. Four properties containing 465 apartment suites are located in Utrecht, the fourth largest city in The Netherlands located just south of Amsterdam, with the remaining properties located in four smaller cities in the east of the country. The total purchase price of EUR64.9 million will be initially financed with CAPREIT's increased euro limit under its Acquisition and Operating Facility. CAPREIT intends to repay a portion of the euro financing upon closing or shortly thereafter with a new EUR40.7 million seven-year LIBOR loan with an all-in interest rate of approximately 2.0%. The purchase price generates a going-in capitalization rate of just under 5.0% and is significantly below replacement cost and appraised value. Occupancy for the total portfolio currently stands at 99.1%. Closing of the transaction is expected on or about December 23, 2016.
CAPREIT will be responsible for providing property management services for the new properties, exporting its proven programs to The Netherlands. CAPREIT has partnered with Rubens Capital Partners, a highly experienced local real estate investment and asset management firm which will own a nominal interest in the portfolio and will provide ongoing acquisition and asset management services to assist in growing CAPREIT's portfolio in the country.
Portfolio Details City Properties Year Built Suites Occupancy Utrecht 4 1965-1967 465 99.4% Scherpenzeel 1 1985 32 93.8% Cuijk 1 1990 26 100.0% Enschede 1 1995 20 100.0% Warnsveld 1 1985-2009 25 100.0% Total 568 99.1%
"We are very excited to be expanding our presence in Western Europe with this acquisition in The Netherlands," commented Thomas Schwartz, President and CEO. "With our success in Ireland, we have proven our ability to accretively enter new markets and quickly build a property portfolio with the size and scale to generate significant benefits for our Unitholders. We look to duplicate our success in Ireland with our new presence in The Netherlands and acquire additional properties in this very strong rental market."
Mr. Schwartz continued: "All of our new properties provide for significant upside opportunity through capital investment, operational efficiencies and rising market rents. The portfolio is attractive, and close to public transit, parks, retail shopping, universities and schools, as well as other amenities. With a current housing shortage in the country, and strong demand created by a growing population that favours rental accommodation, we believe we will see solid returns as we expand our Netherlands' portfolio and bring our proven and scalable property management programs to the region."
As one of Canada's largest residential landlords, CAPREIT is a growth-oriented investment trust owning interests in 48,196 residential units, comprising 41,748 residential suites and 31 manufactured home communities comprising 6,448 land lease sites located in and near major urban centres across Canada. For more information about CAPREIT, its business and its investment highlights, please refer to 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.
FOR FURTHER INFORMATION PLEASE CONTACT: CAPREIT Mr. Thomas Schwartz President & CEO (416) 861-9404 CAPREIT Mr. Scott Cryer Chief Financial Officer (416) 861-5771 CAPREIT Mr. Michael Stein Chairman (416) 861-5788 Source: Canadian Apartment Properties Real Estate Investment Trust