TORONTO, Dec. 8, 2017 /CNW/ - Brookfield Real Estate
Services Inc. (the "Company") (TSX: BRE) announced today that it
has approved the acquisition of certain franchise agreements from
Brookfield Real Estate Services Manager Limited ("the
Manager").
Acquisition of Franchise Agreements
Under the Royal LePage and Via Capitale brands, the Company will
acquire franchise agreements representing 38 real estate operations
and 563 REALTORS®1 across Canada for approximately $8.8 million. These agreements are estimated to
generate an annual royalty stream of $1.2
million and will be effective January
1, 2018.
As outlined in the Company's Management Services Agreement
("MSA") with the Manager, 80 per cent of the acquisition price will
be paid in January 2018 and the
balance will be paid later in the year when the purchase price is
finalized, based on the actual performance of the acquired
agreements.
The payment due January 1, 2018 of
approximately $7.0 million, plus
applicable HST, will be funded through a combination of cash on
hand and a draw down on the Company's debt facilities.
"We are very pleased with the strong and consistent growth of
our Company's Network," said Phil
Soper, president and chief executive officer, Brookfield
Real Estate Services Inc. "Our high quality brands enjoy
nationwide appeal and geographical diversification, which
has certainly helped the business successfully navigate market
slumps in Alberta in 2015,
British Columbia in 2016 and
Ontario this year. The tools,
services and support our Brands offer brokerages and
REALTORS® position them for success in a highly
competitive industry."
Forward-Looking Statements
This news release contains forward-looking information and other
"forward-looking statements". Words such as "will", "estimated",
"later", "growth" and other expressions that are predictions of or
could indicate future events and trends and that do not relate to
historical matters identify forward-looking statements. Reliance
should not be placed on forward-looking statements because they
involve known and unknown risks, uncertainties and other factors
that may cause the actual results, performance or achievements of
the Company to differ materially from anticipated future results,
performance or achievement expressed or implied by such
forward-looking statements. Factors that could cause actual results
to differ materially from those indicated in the forward looking
statements include: increases or decreases in the number of
REALTORS® prior to the acquisition date, availability of financial
resources to the Company, changes in the Company's strategy,
changes in the supply of houses for sale in Canada or in any particular region within
Canada, changes in the demand for
houses in Canada or any particular
region within Canada, changes in
general economic conditions (including interest rates, consumer
confidence and other general economic factors or indicators),
changes in global and regional economic growth, the demand for and
prices of natural resources on local and international markets, the
level of residential real estate transactions, the average rate of
commissions charged, competition from other real estate brokers or
from discount and/or Internet-based real estate alternatives, the
closing of existing real estate brokerage offices, other
developments in the residential real estate brokerage industry or
the Company that reduce the number of REALTORS® in the
Company's Network or royalty revenue from the Company's Network,
our ability to maintain brand equity through the use of trademarks,
changes in tax laws or regulations, and other risks detailed in the
Company's annual information form, which is filed with securities
commissions and posted on SEDAR at www.sedar.com. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law.
About Brookfield Real Estate Services Inc.
Brookfield Real Estate Services Inc. is a leading provider of
services to residential real estate brokers and a network of over
18,000 REALTORS®. We operate in Canada under the Royal LePage, Via
Capitale and Johnston & Daniel brands. For more information, go
to www.Brookfieldresinc.com.
Brookfield Real Estate Services Inc. is an affiliate of
Brookfield Asset Management, a leading global alternative asset
manager with over $250 billion of
assets under management. For more information, go
to www.Brookfield.com.
1 REALTORS® is a trademark identifying real estate
licensees in Canada who are
members of the Canadian Real Estate Association.
SOURCE Brookfield Real Estate Services Inc.