TORONTO, Sept. 15, 2014 /CNW/ – True North Commercial Real Estate Investment Trust (the “REIT“) (TSX: TNT.UN) is pleased to report that it has closed its previously announced acquisition (the “Acquisition“) of an office property located in Edmonton, Alberta (the “Edmonton Property“). The Acquisition is immediately accretive to the REIT’s funds from operations (“FFO“) and adjusted funds from operations (“AFFO“) per unit and reduces the REIT’s AFFO payout ratio.

“This Acquisition allows the REIT to expand its geographic footprint in Alberta and is consistent with our core strategies of acquiring properties that are well located in strong secondary markets and tenanted by government or credit-rated organizations,” said the REIT’s Chief Executive Officer and Chairman of the Board, Daniel Drimmer. “It also increases the REIT’s occupancy level to 98.8% while increasing the REIT’s average lease term.”

The Edmonton Property is a single-storey office building situated northwest of downtown Edmonton, Alberta with a total of 96,804 fully occupied rentable square feet, with 5.3 years remaining on the lease term. The Edmonton Property was originally constructed in 1975 and modernized through extensive renovations and upgrades in 2005 and 2009. The property is well maintained with an excellent parking ratio of 4.1 parking stalls per 1000 square feet (approximately 400 paved parking stalls, a number of which are energized), is well located within close proximity to The Trans-Canada Highway and Highway 216 (Edmonton’s ring road), and is situated on St. Albert Trail, one of Edmonton’s major arterial roads.

The $24.5 million aggregate purchase price represents an implied capitalization rate of 7.4%, and was satisfied by a combination of approximately $6.125 million in cash and approximately $18.375 million aggregate principal amount of new mortgage financing with a 5-year term and an interest rate of 3.30%.

About the REIT

The REIT is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario.

The REIT is focused on acquiring and operating commercial rental properties across Canada and such other jurisdictions where opportunities exist. Additional information concerning the REIT is available at www.sedar.com or the REIT’s website at www.truenorthreit.com.

Non-IFRS measures

The REIT’s consolidated financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS“). The following measures, FFO and AFFO as well as other measures discussed elsewhere in this release, do not have a standardized definition prescribed by IFRS and are, therefore, unlikely to be comparable to similar measures presented by other reporting issuers. The REIT uses these measures to better assess the REIT’s underlying performance and provides these additional measures so that investors may do the same. Details on non-IFRS measures are set out in the REIT’s management’s discussion and analysis for the six months ended June 30, 2014 and available on the REIT’s profile at www.sedar.com.

Forward-Looking Statements

Certain statements contained in this press release constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking statements are provided for the purposes of assisting the reader in understanding the REIT’s financial position and results of operations as at and for the periods ended on certain dates and to present 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. Forward-looking information may relate to the REIT’s future outlook and anticipated events, including financial or operating results and may include statements regarding the financial position, business strategy, budgets, financing rates and costs, taxes and plans and objectives of or involving the REIT. Particularly, statements regarding future results, performance, achievements, prospects or opportunities for the REIT or the real estate industry are forward-looking statements. In some cases, forward-looking information can be identified by terms such as “may”, “might”, “will”, “could”, “should”, “would”, “occur”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “seek”, “aim”, “estimate”, “target”, “project”, “predict”, “forecast”, “potential”, “continue”, “likely”, “schedule”, or the negative thereof or other similar expressions concerning matters that are not historical facts.

Forward-looking statements necessarily involve known and unknown risks and uncertainties, that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, assumptions may not be correct and objectives, strategic goals and priorities will not be achieved. A variety of factors, many of which are beyond the REIT’s control, affect the operations, performance and results of the REIT and its business, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results. These factors include, but are not limited to, the risks discussed in the REIT’s materials filed with Canadian securities regulatory authorities from time to time on www.sedar.com. The reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking statements as there can be no assurance that actual results will be consistent with such forward-looking statements.

Information contained in forward-looking statements is based upon certain material assumptions, including management’s perceptions of historical trends, current conditions and expected future developments that are believed to be appropriate in the circumstances, such as: the Canadian economy will remain stable over the next 12 months; inflation will remain relatively low; interest rates will remain stable; conditions within the real estate market, including competition for acquisitions, will be consistent with the current climate; the Canadian capital markets will continue to provide the REIT with access to equity and/or debt at reasonable rates when required; Starlight Investments Ltd. will continue its involvement as asset manager of the REIT in accordance with its current asset management agreement; and the risks identified or referenced above, collectively, will not have a material impact on the REIT. While management considers these assumptions to be reasonable based on currently available information, they may prove to be incorrect.

The forward-looking statements made in this press release are dated, and relate only to events or information, as of the date of this press release. Except as specifically required by law, the REIT undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

SOURCE True North Apartment Real Estate Investment Trust