TORONTO, ON--(Marketwired - May 05, 2014) - Delavaco Residential Properties Corp. ("Delavaco") (TSX VENTURE: DVO.U) (OTCQX: DELAF) and York Plains Investment Corp. announce that that they have completed their previously announced transaction, pursuant to which Delavaco has acquired all of the issued and outstanding shares of H60 Canada Inc., for an aggregate purchase price of US$6,240,000 (the "Transaction"). H60 Canada Inc. indirectly owns 19 residential properties (the "Properties") located in New Jersey, consisting of a total of 96 separate rental units (the "Units").
The aggregate purchase price was paid as follows: US$3,120,000 by the issuance of 3,120,000 common shares of Delavaco ("Delavaco Shares") based on the share price of US$1.00 per Delavaco Share, representing a premium of approximately 13.6% from US$0.88, the closing price of the Delavaco common shares on the day before this announcement, and two promissory notes (the "Notes") in favour of the vendors in the principal aggregate amount of US$3,120,000, secured by a first ranking lien over the Properties. The aggregate amount owed pursuant to the Notes is subject to a working capital adjustment, and the Notes will not bear interest until the date on which the occupancy rate of the Units exceeds 90%, at which point they will bear interest of 5.5% per annum, with a maturity date of November 1, 2014. As of closing, the 90% threshold has been met and therefore interest commences to accrue immediately.
Andrew DeFrancesco, Chairman and Chief Executive Officer of Delavaco, comments: "Delavaco is excited to be entering the New Jersey market. This initial purchase is an outstanding platform for us to grow in another geographic location that complements our existing model. We look forward to expanding our purchases in the area as they provide immediate accretion from an asset and cash flow basis."
Delavaco Residential Properties Corp. was formed on January 27, 2011 to take advantage of the U.S. housing crisis with the goal of significant capital appreciation through the recovery of the housing sector. Now a public company, Delavaco has its shares listed for trading on the TSX Venture Exchange and the OTCQX marketplace in the U.S. Delavaco is focused on the ownership and management of single and multi-family residential properties located principally in the south-eastern United States. Delavaco's real estate portfolio consists of 525 single-family homes in Florida, 298 single-family homes in Georgia, 311 multi-family units in Florida and Texas and 96 multi-family units in New Jersey. Delavaco also manages a 316 multi-family unit portfolio in Hollywood, Florida. Delavaco's acquisition strategy involves the identification and purchase of under-valued residential properties located in highly populated and dynamic urban centers within the lower to middle income demographic sector with tenants who qualify for government funding under the United States rental voucher assisted program. Delavaco's security holders include some of the leading Canadian institutional investors and real estate holding companies.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: Certain information in this news release constitutes forward-looking statements under applicable securities law. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expect", "intend" and similar expressions. Forward-looking statements in this news release include, but are not limited to, statements with respect to Delavaco's intended acquisition focus. Forward-looking statements necessarily involve known and unknown risks, including, without limitation, risks associated with general economic conditions; adverse industry events; marketing costs; loss of markets; volatility of real estate prices; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; industry and government regulation; changes in legislation, income tax and regulatory matters; the ability of Delavaco to implement its business strategies; competition; currency and interest rate fluctuations and other risks.
Readers are cautioned that the foregoing list is not exhaustive. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
Neither the Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Additional information about Delavaco Residential Properties Corp. is available at www.delavacoproperties.com or www.sedar.com.