/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED
STATES./
TORONTO, Jan. 14, 2020 /CNW/ - Starlight U.S. Multi-Family
(No. 1) Value-Add Fund (TSX-V: SUVA.A, SUVA.U) (the "Fund") today
announced the completion of the Fund's previously announced
indirect sale of the Fund's portfolio of three multi-family
properties totaling 1,193 suites located in the southern
United States (the "Fund
Portfolio") to Clearwater U.S. Multi-Family (No. 2) Holding LP (the
"Purchaser"), a Delaware limited
partnership formed by the Public Sector Pension Investment Board
and Daniel Drimmer, Chief Executive
Officer and Director of the general partner of the Fund (the
"Transaction"). The Fund's unitholders (the "Unitholders")
approved the Transaction at the special meeting of Unitholders held
on January 7, 2020.
"We would like to thank our Unitholders for their ongoing
support of Starlight U.S. Multi-Family and in particular, Starlight
U.S. Multi-Family (No.1) Value-Add Fund since 2017. We are pleased
with the performance of the properties of the Fund which has
resulted in Unitholders earning significant returns that exceeded
our initial targeted internal rate of return," said Evan Kirsh, President of the general partner of
the Fund.
The Transaction was valued at approximately US$239.6 million and included gross cash
consideration of approximately US$92.1
million payable to the Fund, with the Purchaser also
indirectly assuming all of the Fund's existing debt in the amount
of approximately US$147.5
million.
The proceeds from the Transaction will be distributed to the
Unitholders as soon as practicable by way of a cash distribution
per unit of the Fund ("Unit") in the following approximate
amounts:
|
Class of
Units1
|
Pre-US
Tax
|
Pre-US Tax
IRR
|
Post-US
Tax
|
|
Class A
|
C$12.21
|
16.4%
|
C$11.19
|
|
Class C
|
C$12.97
|
16.3%
|
C$11.89
|
|
Class D
|
C$12.21
|
16.4%
|
C$11.19
|
|
Class E
|
US$12.39
|
17.0%
|
US$11.35
|
|
Class F
|
C$12.65
|
16.4%
|
C$11.59
|
|
Class U
|
US$12.39
|
17.0%
|
US$11.35
|
The net proceeds of the Transaction, after applicable U.S. taxes
paid, will be distributed to Unitholders as part of the
cancellation of all issued and outstanding Units and dissolution of
the Fund. Any U.S. taxes paid from the Fund's proceeds of
disposition are generally expected to be recognized as having been
paid by the Unitholders for purposes of the foreign tax credit and
foreign tax deduction rules in the Income Tax Act
(Canada), subject to the detailed
rules and limitations therein.
The Class A Units and the Class U Units are expected to be
delisted from the TSX Venture Exchange effective as of the close of
trading on January 14, 2020. The Fund
will cease to be a reporting issuer in each of the provinces of
Canada in which it was a reporting
issuer following its dissolution.
About Starlight U.S. Multi-Family (No. 1) Value-Add
Fund
The Fund is a limited partnership formed under the Limited
Partnerships Act (Ontario) for
the primary purpose of indirectly acquiring, owning and operating a
portfolio of value-add, income producing rental properties in the
U.S. multi-family real estate market.
For the Fund's complete consolidated financial statements and
management's discussion and analysis ("MD&A") for the fiscal
quarter ended September 30, 2019 and
any other information relating to the Fund, please visit
www.sedar.com. Further details regarding the Fund's unit
performance and distributions, market conditions where the Fund's
properties are located, performance by the Fund's properties and a
capital investment update are also available in the Fund's
November 2019 Newsletter which is
available on the Fund's profile at www.starlightus.com.
Forward-looking Statements
This press release contains forward-looking statements and
information relating to expected future events that involve risks
and uncertainties. Such forward-looking information is typically
indicated by the use of words such as "will", "may", "expects" or
"intends". The forward-looking statements and information contained
in this press release include, without limitation, the expected
timing and quantum for the distribution to Unitholders in
connection with the Transaction, the delisting of the Class A Units
and the Class U Units, the dissolution of the Fund and the Fund
ceasing to be a reporting issuer. Such forward-looking information
and statements involve risks and uncertainties and are based on
Fund management's current expectations, intentions and assumptions.
If unknown risks arise, or if any of the assumptions underlying the
forward-looking statements prove incorrect, actual results may
differ materially from management expectations as projected in such
forward-looking statements. Although management believes that the
Fund's expectations are based upon reasonable assumptions, the
reader should not place undue reliance on forward-looking
statements and information. The Fund disclaims any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
unless required by applicable law.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
_____________________________
1 There are no issued and outstanding Class H
Units.
SOURCE Starlight U.S. Multi-Family (No. 1) Value-Add Fund