Chartwell Seniors Housing REIT
TSX : CSH.UN

Chartwell Seniors Housing REIT

November 16, 2009 08:40 ET

Chartwell to Acquire Three Quebec Retirement Communities

MISSISSAUGA, ONTARIO--(Marketwire – Nov. 16, 2009) - Chartwell Seniors Housing Real Estate Investment Trust (TSX:CSH.UN) announced today that it has agreed to acquire from Le Groupe Melior and its joint venture partners three properties in lease-up and two parcels of vacant land in the Province of Quebec. The properties are currently valued at approximately $87.6 million. The purchase price will be satisfied by the assumption of existing mortgages of approximately $67.1 million and other liabilities of approximately $5.9 million. Subject to adjustments for working capital and closing costs, the remaining amounts will be applied to settle mezzanine loans of $13.8 million and other amounts due to Chartwell. Closing of these transactions is expected in early 2010, however, Chartwell will control the three properties in lease-up as of today.

Chartwell will acquire 100% of Les Appartements du Chateau de Bordeaux, a 149-suite independent living community well-located in an older section of Quebec City between two large community parks. Opened in 2006, this modern seniors apartment residence is situated next to the REIT's Chateau Bordeaux facility and is currently 85% occupied. The lender has agreed to extend the term of the current $21.8 million loan to May 31, 2011. The loan will bear interest at prime plus 1.75%

Chartwell will also acquire 100% of Les Seigneuries du Carrefour, a 275-suite independent living seniors apartment complex located in the heart of Sherbrooke in Quebec's Eastern Townships. A brand-new facility, it is located close to shopping, medical clinics and other services, is surrounded by extensive grounds and walking trails, and is currently 59% occupied. Chartwell expects to convert the existing loan into a $26.4 million CMHC insured long term mortgage and a $1.9 million bridge loan with an interest rate of prime + 2.50% due July 2011.

In addition, Chartwell will be acquiring 100% of Cité Jardin Phase IV, a 173-suite independent living community located in the Cite-Jardin seniors living complex in the City of Gatineau, Quebec close to Ottawa. The property is currently 62% occupied. Chartwell currently owns Phases I, II and IIIA in this complex. The lender has agreed to extend the term of the existing $17.0 million construction loan to October 31, 2012 at an interest rate of prime + 1.75%.

Chartwell will also acquire a 1.73 acre parcel of land adjacent to its existing Residence Duplessis property in Cap de la Madeleine for future internal growth development as well as a parcel of land adjacent to its Residence Principale property for future use. In addition, as part of the agreement Chartwell and Melior have agreed to provide certain mutual releases, amend the terms of certain purchase options and cancel the due diligence and legal services agreements between parties.

"This agreement is consistent with our strategy to make selective acquisitions in markets where we already own properties, thereby generating economies of scale and operating synergies," stated Brent Binions, President and CEO. "We are also pleased to be converting outstanding mezzanine loans into accretive operating properties with solid upside potential as our management teams enhance occupancies and bring rents up to market levels." 

Chartwell is a real estate investment trust focused on generating sustainable, stable and growing cash distributions from owning and managing a complete range of seniors housing communities. It is one of the largest participants in the North American seniors housing business. Chartwell's aim is to capitalize on the strong demographic trends present in its markets to maximize the value of its existing portfolio of seniors housing facilities, and prudently avail itself of opportunities to grow internally and through accretive acquisitions. 

Chartwell's Distribution Reinvestment Plan (DRIP) allows Unitholders to have their monthly cash distributions used to purchase units without incurring commission or brokerage fees, and receive bonus units equal to 3% of their monthly cash distributions. More information can be obtained at www.chartwellreit.ca.

This press release contains forward-looking information that reflect the current expectations of management about the future results, performance, achievements, prospects or opportunities for Chartwell and the seniors housing industry. These statements generally can be identified by use of forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "believe", "project", "should" or "continue" or the negative thereof or similar variations. Forward-looking statements are based upon a number of assumptions and are subject to a number of known and unknown risks and uncertainties, many of which are beyond Chartwell's control that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking statements.

While we anticipate that subsequent events and developments may cause our views to change, we do not have an intention to update this forward-looking information, except as required by applicable securities laws. This forward-looking information represents our views as of the date of this press release and such information should not be relied upon as representing our views as of any date subsequent to the date of this document. We have attempted to identify important factors that could cause actual results, performance or achievements to vary from those current expectations or estimated expressed or implied by the forward-looking information. However, there may be other factors that cause results, performance or achievements not to be as expected or estimated and that could cause actual results, performance or achievements to differ materially from current expectations. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those expected or estimated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. These factors are not intended to represent a complete list of the factors that could affect us. See "Risks and Uncertainties" in our MD&A and risk factors highlighted in materials filed with the securities regulatory authorities in Canada from time to time, including but not limited to our most recent annual information form.

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