BTB Real Estate Investment Trust
TSX VENTURE : BTB.UN

BTB Real Estate Investment Trust

December 04, 2006 13:03 ET

BTB Real Estate Investment Trust Announces $63.4 Million of Conditional Acquisition of Commercial Properties

MONTREAL, QUEBEC--(CCNMatthews - Dec. 4, 2006) - The trustees of BTB Real Estate Investment Trust (TSX VENTURE:BTB.UN) ("BTB") are proud to announce that they have entered into conditional agreements to purchase two real estate portfolios consisting of a total of 15 buildings, as well as a small strip mall on the South Shore of Montreal. Ten buildings are located in the greater Montreal area and five buildings are located in Cornwall, Ontario. These acquisitions consist of mixed-use office, commercial and light industrial buildings. The cost of acquisition is approximately $63.4 million, including closing fees, representing an average capitalization rate of 8.8%.

Management feels that there is a good potential to increase revenues as leases are renewed. Lease covenants are excellent and provide for stable cash flows.

Closing on these properties is scheduled for mid-December. Since October 3, 2006, BTB has negotiated agreements to purchase properties, the value of which is in excess of $91 million.

A brief description of the properties follows:

12055-12085 Marcel Laurin Blvd., Montreal, Quebec

This strip mall is approximately 30,752 square feet. It serves its local market and is well located. Marcel Laurin Boulevard bridges the islands of Montreal and Laval. Heavy traffic provides excellent commercial exposure.

4890-4898 Taschereau Blvd., Longueuil, Quebec

This mixed-use property is approximately 33,982 square feet. Its main commercial tenants are a franchised restaurant and a major eye wear store. Both tenants have long-term leases. The second floor of the building is used as office space and houses five different tenants, including a law firm and a distributor of goods.

3629-3645 Sources Blvd., Dollard-des-Ormeaux, Quebec

This building of approximately 19,908 square feet is situated at one of the main throughway in the Western portion of the Island of Montreal. Its tenants therefore enjoy great visibility. The main tenants are a chartered bank and a restaurant. The second floor is used as office space.

Plaza St-Louis, Lachine, Quebec

The leasable area of this semi-commercial building is approximately 14,004 square feet. A chartered bank is the anchor tenant and occupies 80% of the ground floor. The property is fully leased.

1125 St-Martin Blvd., Laval, Quebec

This building of approximately 9,723 square feet is fully leased to an eye wear store, a major retailer in the Province of Quebec. This building is well located on one of Laval's main commercial arteries.

3781 Des Sources Blvd., Dollard-des-Ormeaux, Quebec

This building of approximately 33,012 square feet is fully leased. The property offers ample parking and benefits from a lease that runs through 2013.

2330-2340 Cohen Street, Montreal, (borough of St-Laurent), Quebec

In the heart of the St-Laurent Industrial Park, this building of approximately 71,675 square feet is fully leased to a contract research organization.

7205-7235 St-Jacques Street West, Montreal, Quebec

This commercial strip of approximately 25,392 square feet is anchored by a franchised restaurant and provides BTB with a good potential to increase revenues. It is well located in a growing retail strip which will ensure good long term sustainability. Eventually BTB may be in a position to redevelop part of the property.

600 Industrial Blvd. St-Jean-sur-Richelieu, Quebec

This industrial building of approximately 137,511 square feet is fully leased to a Canadian distributor and retailer of hardware and to a sport equipment distributor.

1863-1865 Trans-Canada Highway, Dorval, Quebec

This building of approximately 42,310 square feet is fully leased with great visibility on the Trans-Canada Highway. Management believes it can increase its revenues over time.

2340 Lapiniere Blvd., Brossard, Quebec

This building is located on one of the busiest corner of the South Shore of Montreal (Taschereau Boulevard and Lapiniere Boulevard). This fully leased commercial property of approximately 19,200 square feet has long-term leases which will provide stable cash flows.

Cornwall, Ontario

These five light industrial buildings located in Cornwall, Ontario, have a total area of approximately 632,803 square feet. The average lease maturity is 6.9 years. These buildings are used as distribution centers and third party warehousing.

BTB has acquired in November the small strip center at 2220 Lapiniere Blvd. in Brossard.

These acquisitions are consistent with management's strategy of acquiring properties which are geographically well located and have the potential to increase revenues.

Mr. Michel Leonard, President and Chief Executive Officer of BTB, stated that this portion of $63.4 million of acquisitions reflects the acquisition strategy outlined in the final prospectus of BTB dated September 26, 2006.

BTB filed on November 29, 2006 its financial results for the 81-day period ended September 30, 2006. These interim financial statements are available electronically at www.sedar.com.

Income Tax

On October 31, 2006, the Federal Minister of Finances announced modifications proposals to the income tax regime of publicly listed income trusts and partnerships (flow-through entities) ("FTE") and their unit holders. Under these proposals, FTE will be taxed under a regime similar to that of corporations and their unitholders will be treated like shareholders. The introduction in the Income Tax Act (Canada) of a definition of "Real Estate Investment Trust" ("REIT") is also proposed. Based on the information now available, BTB would meet the conditions of this new definition of REIT. In such a case, its income and of its unitholders would be subjected to a regime of one level taxation similar to the one they are currently subjected to. Based on the limited information currently available, management of BTB believes that neither BTB nor its unitholders would be negatively affected by these proposals. Nothing guaranties that these proposals will become law, as announced.

Forward Looking Statements

This press release contains forward looking statements. Forward-looking statements are subject to risks, uncertainties and assumptions. Although the trustees of BTB believe that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Some of the factors and risks which could affect future results and could cause results to differ materially from those expressed in the forward-looking statements contained herein include the impact of general economic conditions, industry conditions, governmental regulation, environmental risks, competition from other industry participants, stock market volatility, the ability to access sufficient capital from internal and external sources and the risk of fluctuation and variation in actual operating results, which variation may be material. A full description of these risk factors can be found in BTB's final prospectus dated September 26, 2006 which is available electronically at www.sedar.com.

The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included herein are made as of the date hereof and BTB does not undertake any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transactions and has neither approved nor disapproved the contents of this press release. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this press release.

Contact Information

  • BTB Real Estate Investment Trust
    Mr. Michel Leonard
    President and Chief Executive Officer
    514-866-1990 ext. 236
    or
    BTB Real Estate Investment Trust
    Mr. George Rossi
    Vice President and Chief Financial Officer
    514-956-2526