TORONTO,
June 16, 2014 /CNW/ - H&R
Real Estate Investment Trust ("H&R") (TSX: HR.UN; HR.DB.D;
HR.DB.E and HR.DB.H) announced today that it has agreed to
participate as a 50% joint venture partner, with Tishman Speyer, in developing a landmark luxury
residential rental development (the "Project") in Long Island City, New York. Tishman Speyer will act as the developer and
manager of the Project.
The parcel is zoned for 1.2 million square feet
of mixed-used development, potentially accommodating up to
approximately 1,600 rental units and approximately 30,000 square
feet of retail space developed in three phases. The site is
located adjacent to 2 Gotham Center, a fully-leased,
state-of-the-art, 670,000 square foot office tower that was
developed by Tishman Speyer in 2011
and acquired by H&R later that same year.
In the initial phase of the new development,
H&R and Tishman Speyer plan to
construct a 42-storey tower, which will include 700 rental
apartment units. Construction is expected to begin in 2015
with occupancy expected to commence in 2017.
H&R's share of the total land cost is US
$55.6 million which was at a
substantial discount to appraised value. Tishman Speyer has had an interest in its share
of the land since 2003. The total Project cost of all phases
at the 100% level is expected to be approximately US $875 million.
Long Island City
has experienced remarkable growth, and will continue to be a highly
sought after destination across New York. The neighborhood's
waterfront parks, popular restaurants and cafes, and a notable
array of art and sculpture museums have made it one of the fastest
growing mixed-use communities in New York City.
The site, which offers sweeping views of the East
River and New York City's iconic
skyline, also benefits from immediate access to 8 subway lines and
is a 5-minute commute to Midtown Manhattan. Outstanding bus
service, as well as easy access to the Ed Koch Queensboro Bridge,
the Long Island Expressway and a Long Island Railroad station, add
to the site's exceptional connectivity to Manhattan and the region.
"We are excited at the opportunity to participate
with Tishman Speyer in the long-term
growth and evolution of Long Island
City, at the intersection of two of the area's most
important thoroughfares", said H&R's President & CEO
Tom Hofstedter. "This project
further diversifies H&R and expands our foothold in one of the
world's largest and most prosperous metropolitan areas."
Tishman Speyer Co-CEOs Jerry Speyer and Rob
Speyer said, "Tishman Speyer
has long been committed to Long Island
City and its ongoing transformation as a dynamic mixed-use
district. We are very pleased to partner with H&R as we
seek to build upon the neighborhood's growing vitality."
About H&R REIT
(www.hr-reit.com)
H&R REIT is an open-ended real estate
investment trust, which owns a North American portfolio of 41
office, 111 industrial and 168 retail properties comprising over 53
million square feet and 2 development projects, with a fair value
of approximately $13 billion.
In addition, H&R REIT owns a 33.6% interest in ECHO Realty LP
which owns 178 properties, excluding properties under development
and vacant land, comprising over 7.4 million square feet. The
foundation of H&R REIT's success since inception in 1996 has
been a disciplined strategy that leads to consistent and profitable
growth. H&R REIT leases its properties for long terms to
creditworthy tenants and strives to match those leases with
primarily long-term, fixed-rate financing.
About Tishman
Speyer (www.tishmanspeyer.com)
Tishman Speyer is
one of the leading developers, owners, operators, and asset
managers of first class real estate worldwide. Active across
North America, Europe, South
America and Asia,
Tishman Speyer is relied upon by
many of the world's most prestigious corporations to meet their
office space needs. As of December 31,
2013, the firm had acquired, developed and/or managed a
portfolio of approximately 129 million sq. ft. with a total value
of approximately USD $66.2 billion
since its founding in 1978. Signature assets include
New York's Rockefeller Center and
the Chrysler Center, São Paulo's Torre
Norte, Ventura Corporate Towers in Rio de Janeiro, and OpernTurm in
Frankfurt. Tishman Speyer also
has projects at different stages of development currently in
Brasília, Chengdu, Frankfurt, Gurgaon, Hyderabad, Paris, Rio de
Janeiro, San Francisco, São
Paulo, Shanghai, Suzhou and
Tianjin.
Forward-looking Statements
Certain statements in this news release contain
forward-looking information within the meaning of applicable
securities laws (also known as forward-looking statements)
including, among others, statements relating to H&R's beliefs,
plans, estimates, and intentions, and similar statements concerning
anticipated future events, results, circumstances, performance or
expectations that are not historical facts. Forward-looking
statements generally can be identified by words such as "outlook",
"objective", "may", "will", "expect", "intend", "estimate",
"anticipate", "believe", "should", "plans", "project", "budget" or
"continue" or similar expressions suggesting future outcomes or
events. Such forward-looking statements reflect H&R's current
beliefs and are based on information currently available to
management. These statements are not guarantees of future
performance and are based on H&R's estimates and assumptions
that are subject to risks and uncertainties, including those
discussed in H&R's materials filed with the Canadian securities
regulatory authorities from time to time, which could cause the
actual results and performance of H&R to differ materially from
the forward-looking statements contained in this news release.
Those risks and uncertainties include, among other things, risks
related to: timing of the development of the Project; costs for the
development of the Project; return on the Project;
appreciation of real estate values in Long Island City; prices and market value of
securities of H&R; real property ownership; availability of
cash for distributions; restrictions pursuant to the terms of
indebtedness; liquidity; credit risk and tenant concentration;
interest rate and other debt related risk; tax risk; ability to
access capital markets; dilution; lease rollover risk; construction
risks; joint arrangements risk; currency risk; unitholder
liability; co-ownership interest in properties; competition for
real property investments; environmental matters and changes in
legislation and indebtedness of H&R. Material factors or
assumptions that were applied in drawing a conclusion or making an
estimate set out in the forward-looking statements include that the
general economy is stable; local real estate conditions are stable;
interest rates are relatively stable; and equity and debt markets
continue to provide access to capital. H&R cautions that this
list of factors is not exhaustive. Although the forward-looking
statements contained in this news release are based upon what
H&R believes are reasonable assumptions, there can be no
assurance that actual results will be consistent with these
forward-looking statements. All forward-looking statements in this
news release are qualified by these cautionary statements. These
forward-looking statements are made as of today, and H&R,
except as required by applicable law, assumes no obligation to
update or revise them to reflect new information or the occurrence
of future events or circumstances.
SOURCE H&R Real Estate Investment Trust