TORONTO, July 27, 2015 /CNW/ - Firm Capital Property Trust
("FCPT" or the "Trust") (TSXV: FCD.UN) is pleased to
announce the purchase of a 70% interest in seven industrial
buildings located in Waterloo,
Ontario (the "Portfolio"). The acquisition price for
100% of the Portfolio is approximately $43.3
million, excluding transaction costs. The capitalization
rate is approximately 7%. The acquisition is expected to close
during the third quarter of 2015.
The Portfolio is comprised of seven multi-tenant industrial
buildings totaling 510,034 square feet. The Portfolio has in excess
of 40 tenants with a weighted average lease term of approximately
4.0 years. The Portfolio is currently 100% occupied.
The entire Portfolio is being financed through the assumption of
a $29.0 million first mortgage at a
2.95% interest rate and existing cash resources. 70% of the
Portfolio will be acquired by the Trust, while the remaining 30%
will be acquired by a private syndicate group.
ACQUISITION IMPACT ON THE TRUST
Pro-forma the
Portfolio acquisition, the Trust's Adjusted Funds From Operations
("AFFO") payout ratio is anticipated to be below 80% and
Debt to Gross Book Value is expected to be approximately 50%. The
Trust will increase the size of its current portfolio by
approximately 34% to $122 million and
will grow to 60 properties.
5% DISTRIBUTION INCREASE IS THIRD INCREASE OR 20% OVERALL
INCREASE IN LESS THAN THREE YEARS
As a result of the
Portfolio acquisition and overall improved financial performance,
the Trust will be increasing its annualized cash distribution by 5%
to $0.42 per Trust Unit per annum or
$0.035 per Trust Unit per month from
$0.40 per Trust Unit per annum or
$0.033333 per Trust Unit per month
commencing in November, 2015 payable in December, 2015, subject to
closing the Portfolio acquisition. This is the Trust's third
distribution increase since its inception in late 2012 and
represents total aggregate distribution increases of 20%. We
anticipate this increased distribution to result in an AFFO payout
ratio of below 85%.
In addition, the Trust announces that it has declared and
approved monthly distributions in the amount of $0.033333 per Trust Unit for unitholders of
record on October 30, 2015 payable on
or about November 16, 2015 and
$0.035 per Trust Unit for unitholders
of record on November 30, 2015 and
December 31, 2015 payable on or about
December 15, 2015 and January 15, 2016, respectively, subject to
closing the Portfolio acquisition.
ABOUT FIRM CAPITAL PROPERTY TRUST
Firm Capital
Property Trust is focused on creating long-term value for
Unitholders, through capital preservation and disciplined investing
to achieve stable distributable income. In partnership with
management and industry leaders, The Trust's plan is to co-own a
diversified property portfolio of multi-residential, flex
industrial, net lease convenience retail, and core service provider
professional space. In addition to stand alone accretive
acquisitions, the Trust will make joint acquisitions with strong
financial partners and acquisitions of partial interests from
existing ownership groups, in a manner that provides liquidity to
those selling owners and professional management for those
remaining as partners. Firm Capital Properties Inc., through
a structure focused on an alignment of interests with the Trust
sources, syndicates and property and asset manages investments on
behalf of the Trust.
Further information about the Trust can be found by selecting
the Firm Capital Property Trust link at www.firmcapital.com.
FORWARD LOOKING INFORMATION
This press release may
contain forward-looking statements. In some cases, forward-looking
statements can be identified by the use of words such as "may",
"will", "should", "expect", "plan", "anticipate", "believe",
"estimate", "predict", "potential", "continue", and by discussions
of strategies that involve risks and uncertainties. The
forward-looking statements are based on certain key expectations
and assumptions made by the Trust regarding, among other things,
the closing of the acquisition of the Portfolio. By their nature,
forward-looking statements involve numerous assumptions, inherent
risks and uncertainties, both general and specific, that contribute
to the possibility that the predictions, forecasts, projections and
various future events will not occur. Although management of the
Trust believes that the expectations reflected in the
forward-looking statements are reasonable, there can be no
assurance that future results, levels of activity, performance or
achievements will occur as anticipated. Neither the Trust nor any
other person assumes responsibility for the accuracy and
completeness of any forward-looking statements, and no one has any
obligation to update or revise any forward-looking statement,
whether as a result of new information, future events or such other
factors which affect this information, except as required by
law.
SOURCE Firm Capital Property Trust