Canadian Apartment Properties Real Estate Investment Trust
TSX : CAR.UN

Canadian Apartment Properties Real Estate Investment Trust

July 31, 2006 16:21 ET

Canadian Apartment Properties REIT Announces Unit Financing of $60.3 MM to Finance a New 338 Suite Acquisition in Longueuil, Quebec and the Prior Acquisition of Interests in 3,081 Suites

TORONTO, ONTARIO--(CCNMatthews - July 31, 2006) -

NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES

Canadian Apartment Properties Real Estate Investment Trust ("CAP REIT") (TSX:CAR.UN) of Toronto, Ontario today announced that it has agreed to sell, subject to regulatory approval, 3,570,000 Units for $16.90 per Unit for aggregate gross proceeds of $60,333,000 to a syndicate of underwriters led by RBC Capital Markets on a bought-deal basis. This offering will increase CAP REIT's market capitalization to over $1 billion, based on the current trading price of the Units.

CAP REIT will, within the next few days, file with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada, a preliminary short form prospectus relating to the issuance of the Units. Closing of the offering is expected to take place on or about August 22, 2006.

CAP REIT intends to use the net proceeds of this offering to repay a portion of amounts currently owing under CAP REIT's Acquisition Facility, which has had approximately $88.8 million drawn on it since our last trust unit offering in July 2005 to acquire the Longueuil Portfolio (see below) and to complete six other acquisitions, which had aggregate acquisition costs of $225.8 million, and the remainder, if any, for future acquisitions, capital expenditures and general trust purposes.



# of Acquisition
Acquisitions Suites Costs (1)

LSR Portfolio in Montreal, Quebec 1,431 $80.6
Three Properties in Vancouver, British Columbia 406 $57.8
Remaining Interests in Domaine Salaberry and
Domaine Choisy (2) 687 $14.6
Six Apartment Buildings and Six Townhouse
Complexes in Etobicoke, Ontario 464 $45.0
Adjacent Parcel of Land in Richmond,
British Columbia n/a $1.6
2 Apartment Buildings in Orangeville, Ontario 93 $7.2
14 Apartment Buildings in Longueuil, Quebec 338 $19.0

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Total 3,419 $225.8
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(1) $ amounts in millions
(2) Acquired the remaining 45% interest in Domaine Salaberry
(250 suites) and the remaining 48.5% interest in Domaine Choisy
(437 suites)


CAP REIT also announced today that it has acquired two neighbouring projects comprising 178 and 160 suites respectively, located in Longueuil, in the Greater Montreal Area. The total acquisition costs were approximately $19.0 million (including closing costs and transfer taxes). CAP REIT also assumed existing mortgages of approximately $11.4 million ranging from one to five year terms, with effective interest rates ranging from 4.51% to 4.67%. The purchase price of approximately $55,000 per suite is well below replacement cost in the region. The closing occurred on July 27, 2006. The two properties, in the mid-tier and affordable segments, are well located in a residential neighbourhood close to transit, parks, schools and supermarkets and one of the properties has an outdoor swimming pool.

"We are continuing to build our presence in the Greater Montreal Area. With the completion of this transaction, we will have 4,551 suites or 17.4% of our total portfolio in Quebec, further enhancing our overall geographic diversification," commented Thomas Schwartz, President and Chief Executive Officer. "In addition, with the completion of the acquisition, we have acquired a total of 895 suites so far this year, and we remain confident that we will achieve our annual target of adding between 1,500 and 2,000 suites to the portfolio by the end of 2006."

CAP REIT intends to make monthly cash distributions to Unitholders of record on each record date, on or about the 15th day of the month following the record date. CAP REIT's current monthly cash distribution is $0.09 per Unit. The first cash distribution to which purchasers of the Units under this offering will be entitled to participate will be for the month of August, with a record date of August 31, 2006 and a payment date of September 15, 2006.

The Units being offered have not been and will not be registered under the United States Securities Act of 1933 and state securities laws. Accordingly, the Units may not be offered or sold to U.S. persons except pursuant to applicable exemptions from registration.

As one of Canada's largest residential landlords, CAP REIT (TSX: CAR.UN.) is a growth-oriented investment trust owning interests in 26,147 residential suites located in major urban centres from coast to coast. Since its Initial Public Offering in May 1997, CAP REIT has grown monthly distributions per Unit by 51%.

All statements in this press release that do not relate to historical facts constitute forward-looking statements. These statements represent CAP REIT's intentions, plans, expectations and beliefs and are subject to certain risks and uncertainties that could result in actual results differing materially from these forward-looking statements. These risks and uncertainties are more fully described in regulatory filings that can be obtained on SEDAR at www.sedar.com.

Contact Information

  • Canadian Apartment Properties Real Estate Investment Trust
    Mr. Thomas Schwartz
    President & CEO
    (416) 861-9404
    or
    Canadian Apartment Properties Real Estate Investment Trust
    Mr. Michael Stein
    Chairman
    (416) 861-5788
    or
    Canadian Apartment Properties Real Estate Investment Trust
    Mr. Yazdi Bharucha
    CFO & Secretary
    (416) 861-5771