Alexis Nihon Real Estate Investment Trust

Alexis Nihon Real Estate Investment Trust

June 17, 2005 09:06 ET

Alexis Nihon REIT Announces $43.1 Million Acquisition of Industrial Properties in Montreal

MONTREAL, QUEBEC--(CCNMatthews - June 17, 2005) - Alexis Nihon REIT (TSX:AN.UN) today announced the acquisition of three industrial properties in Montreal. The acquisition price of $43.1 million represents a capitalization rate of 8.8%.

The properties were purchased as a portfolio, held in a joint venture that includes Agellan Capital Partners Inc. Leasable area of the portfolio totals 952,960 square feet, representing an acquisition price of $45 per square foot.

Two of the properties are located in the borough of Lachine, the other in St. Laurent. The properties are fully occupied by single tenants - Hudson's Bay Company, Michelin Tire's national distributor and a unit of Uni-Select Inc., nationwide distributor of vehicle components.

"These properties are very well located near major Montreal highways and the Pierre-Elliot-Trudeau International Airport," said Paul J. Massicotte, President and CEO. "In addition, they enhance the industrial asset segment of the REIT's portfolio and underline the ongoing commitment of Alexis Nihon to our core geographic territory of Montreal."

"The acquisition price is accretive to unitholders and represents a significant discount to replacement cost," said Rene Fortin, Senior Vice-President and Chief Financial Officer. "In addition to constituting excellent value, these properties will enhance the stability of the REIT's cash flow and contribute to long-term unitholder value."

The addition increases the industrial segment of the portfolio by 34.6% to 3,710,495 square feet. Following the acquisition, asset allocation within the REIT's portfolio consists of the following:

Asset class No. of properties Square footage Percentage of
(millions) total
Industrial 31 3.71 44.9%
Office 19 2.81 34.1%
Retail 4 1.43 17.4%
Residential(a) 0 0.30 3.6%

(a)Residential apartments are located in Place Alexis Nihon, classed
as an office property.

The purchase price, less $7.7 million in assumed mortgages on one of the properties, will be funded by the REIT's credit facilities. However, the REIT intends to put in place first mortgages, at 75% loan to value, on the other two properties at rates varying between 4.75% to 5.25%.

About Alexis Nihon REIT

The REIT currently owns interests in 54 office, retail, and industrial properties, including a 426-unit multi-family residential property, all located in the greater Montreal area and the National Capital region. The REIT 's portfolio has an aggregate of 8.3 million square feet of leasable area, of which 0.4 million square feet is co-owned.

Contact Information