Allied Properties REIT buys Montreal and Calgary properties for $69.2 million

Allied Properties REIT announced that it has entered into agreements to purchase the following properties for $69.2 million:
 
 
                                               Total  Office  Retail Parking
Address                                          GLA     GLA     GLA  Spaces
----------------------------------------------------------------------------
85 Rue St. Paul, Montreal                     79,778  79,778       -      25
The Pilkington Building, 402 - 11th Avenue                                  
 S.E., Calgary                                48,223  48,223       -      44
The Biscuit Block, 438 - 11th Avenue S.E.,                                  
 Calgary                                      54,073  54,073       -      39
----------------------------------------------------------------------------
                                             182,074 182,074       -     108
----------------------------------------------------------------------------
 
"We continue to find high-quality infill properties that fit squarely within our investment parameters," said Michael Emory, President & CEO. "In addition to being immediately accretive, each of these properties is close to one or more of our existing properties. The Calgary properties form nearly half a city block in the heart of the Warehouse District."
Allied also announced the establishment of a fourth intensification joint venture with RioCan REIT through the acquisition of an undivided 50% interest in 491 College Street and 289 Palmerston Avenue in Toronto. "This is our fourth intensification JV with RioCan," said Mr. Emory. "It will enable both of us to build on the collaborative relationship that has been developed through the College & Manning JV, the King & Portland JV and the Downtown West JV, all of which are progressing well."
 
The Montreal Property
 
Located on the northeast corner of Rue St. Paul and Rue St. Sulpice, this property is comprised of 79,778 square feet of GLA, all of which is leased to tenants consistent in character and quality with Allied's tenant base. Built in 1861, the building was renovated and upgraded in 2001.
 
The Pilkington Building, Calgary
 
Located on northeast corner of 11th Avenue S.E. and 3th Street S.E., this property is comprised of 48,223 square feet of GLA, all of which is leased to tenants consistent in character and quality with Allied's tenant base, and 44 surface parking spaces. Built in 1913, the building was renovated and upgraded in 2012.
 
The Biscuit Block, Calgary
 
Located on northwest corner of 11th Avenue S.E. and 4th Street S.E., this property is comprised of 54,073 square feet of GLA, all of which is leased to tenants consistent in character and quality with Allied's tenant base, nine surface parking spaces and 30 underground parking spaces. Built in 1912, the building was renovated and upgraded in 2013.
 
Closing and Financing
 
The acquisitions in Montreal and Calgary are expected to close in February and March of 2014, subject to customary conditions. The purchase price for the three properties represents a capitalization rate of approximately 6.8% applied to the current annual net operating income ("NOI"). The properties will be free and clear of mortgage financing immediately prior closing. Allied plans to place mortgage financing on the properties on or soon after closing and will fund the equity component of the acquisitions with cash-on-hand.
 
College & Palmerston Joint Venture, Toronto
 
491 College Street and 289 Palmerston Avenue are comprised of 15,651 square feet of land on the south side of College and the east side of Palmerston. The College portion has 90 feet of frontage and includes a heritage building with just over 10,000 square feet of GLA. The Palmerston portion is separated from the College portion by a public laneway and is currently used for ancillary parking. The property was acquired by Allied and RioCan on a 50/50 basis in late December of 2013 for $7.7 million without the use of mortgage financing. While currently operating the property for rental purposes, the joint venture intends to intensify it over time by creating a mixed-use office, retail and residential complex, similar in concept to the one contemplated by the College & Manning JV.
 

on January 20, 2014