MISSISSAUGA, ONTARIO--(Marketwired - March 11, 2014) - Chartwell Retirement Residences (TSX:CSH.UN) ("Chartwell") announced today that it has entered into a binding agreement to sell a portfolio of 14 retirement residences comprised of 945 suites located in Ontario (collectively, the "Portfolio") to a private purchaser.
The sale price for the Portfolio is $65.95 million and will be partially settled through the purchaser's assumption of mortgages with an outstanding balance on the date of this press release of approximately $19.52 million. The mortgage debt carries a weighted average interest rate of 5.64% per annum and has a weighted average term to maturity of approximately three years. Chartwell will provide the purchaser with vendor take-back mortgages ("VTBs") secured by charges against certain properties in the Portfolio in the amount of $6.0 million, bearing interest at 8% per annum and having a three year term to maturity. The VTBs will be cross-collateralized and cross-defaulted and will be secured by the corporate guarantee of the purchaser. The balance of the purchase price, subject to customary closing adjustments, will be paid in cash. The purchaser has completed its due diligence and the closing of the transaction, subject to limited conditions, is expected in the second quarter of 2014.
"The sale of this Portfolio is in line with our strategy to divest assets that we consider non-core," commented Brent Binions, Chartwell's President and CEO. "We would like to extend our appreciation to the staff of these properties for their commitment to offering the best care and services possible. We believe the purchaser will continue to provide quality care and service to the residents of the Portfolio. We will continue to work with the purchaser to minimize the impact of the transition on residents and staff."
The following is a list of properties in the Portfolio:
|Name of the residence
||Number of suites
|Atrium Retirement Residence
|Atrium Villa Retirement Residence
|Cobourg Retirement Residence
|Devonshire Retirement Residence
|Gravenhurst Retirement Residence
|Maple Court Retirement Residence
|Mayfield Retirement Residence
|Millwood Retirement Residence
|Oxford Manor Retirement Residence
|Park Place Retirement Residence
|Peterborough Retirement Residence
|Teddington Park Retirement Residence
|Tillsonburg Retirement Residence
|Willoughby Manor Retirement Residence
Chartwell is an unincorporated, open-ended trust which indirectly owns and operates a complete range of residences from independent supportive living through assisted living to long term care. It is one of the largest participants in the seniors housing business in North America. Chartwell's aim is to capitalize on the strong demographic trends present in its markets to maximize the value of its existing portfolio of retirement residences, 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.chartwell.com.
This press release contains forward-looking information that reflects the current expectations, estimates and projections of management about the future results, performance, achievements, prospects or opportunities for Chartwell and the seniors housing industry. The words "plans", "expects", "does not expect", "is expected", "budget", "scheduled", "estimates", "intends", "anticipates", "does not anticipate", "projects", "believes" or variations of such words and phrases or statements to the effect that certain actions, events or results "may", "will", "could", "would", "might", "occur", "be achieved" or "continue" and similar expressions identify forward-looking statements. 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 our control, and 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 intend 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 estimates 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 the 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.