Partners Real Estate Investment Trust to Acquire Four New Ontario Properties

Partners Real Estate Investment Trust has entered into a purchase and sale agreement to acquire four retail centers in Ontario . The Properties are located in Hamilton, London, Kemptville and North Bay and total approximately 695,500 square feet of gross leasable area. The tenant roster of the Properties includes Shoppers Drug Mart, Winners, Giant Tiger and Dollar Tree. The Properties are estimated to generate annualized Net Operating Income in the aggregate of approximately $7,250,000.
 
The REIT will pay approximately $109,000,000 for the Properties, satisfied by (i) the assumption of certain debt secured by the Properties and, (ii) the issuance of units of a limited partnership to be formed by the REIT for the purposes of completing the acquisition as purchaser (the "New LP"), with such units including 6,450,000 class B units of the New LP (the "Class B Units"). The Class B Units will be exchangeable for units of the REIT on a one-for-one basis and will be the economic equivalent of units of the REIT and carry the right to vote at the REIT level. The Class B Units will be issued at an effective price of $7.61 per Class B Unit. After giving effect to the issuance of the Class B Units, the vendors will hold approximately 19.9% of the outstanding units of the REIT, calculated on a fully-diluted basis.
 
In addition, the Trustees of the REIT have amended the terms of the existing unitholder rights plan to permit units of the REIT to be issued as consideration for the direct or indirect acquisition of real estate on terms approved by the Trustees. Accordingly, the proposed issuance of Class B Units in connection with the transaction will be permitted under the terms of the unitholder rights plan.
 
The closing of the transaction is expected to occur in January 2014 and is subject to regulatory approval and the fulfillment of certain conditions precedent including the REIT's completion of satisfactory due diligence.
 

on December 20, 2013