First Capital Realty Inc.
TSX : FCR

First Capital Realty Inc.

August 04, 2016 16:37 ET

First Capital Realty Announces Toronto Investments and $150 Million Equity Offering

TORONTO, ONTARIO--(Marketwired - Aug. 4, 2016) -

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

First Capital Realty Inc. (TSX:FCR), one of Canada's largest owners, developers and managers of grocery anchored, retail-focused urban properties, announced today that it has entered into an agreement to sell 6,640,000 common shares ("Shares") on a bought deal basis at a price of $22.60 per Share to a syndicate of underwriters co-led by TD Securities Inc. and RBC Capital Markets for gross proceeds of approximately $150 million (the "Offering").

In addition, the Company has granted the syndicate an over-allotment option, exercisable in whole or in part at any time up to 30 days after closing, to purchase up to an additional 996,000 Shares at the Offering price which, if exercised in full, would increase the gross Offering size to approximately $173 million.

The Offering is scheduled to close on or about August 17, 2016, and is subject to regulatory approval. The Offering is being made under the Company's base shelf prospectus dated October 9, 2014. The terms of the Offering will be described in a prospectus supplement to be filed with Canadian securities regulators.

The net proceeds of the Offering will be used to partially fund the Company's capital requirements for the following transactions:

Flagship Retail Property at Yonge Street and Bloor Street, Toronto

The Company has entered into a binding agreement to purchase 85,000 square feet of new flagship retail space and 52 commercial parking stalls at the southeast corner of Yonge Street and Bloor Street in Toronto for a cash purchase price of $189.2 million. The property comprises three levels of retail space with over 220 feet and 270 feet of high visibility frontage on Bloor Street and Yonge Street, respectively, one of the busiest pedestrian intersections in Canada. The retail space is situated at the base of a 76-storey residential condominium tower that contains approximately 760 units, with residents expected to begin occupying these units during the fall of 2016. The property also features a direct connection to the busy Bloor-Yonge subway station which is utilized by over 400,000 passengers daily.

This landmark property will form the eastern gateway to Bloor Street's main retail area that is home to marquee locations for many of the world's most recognized luxury and mid-market retailers and which commands among the highest retail rents in Canada. Nordstrom Rack will be a major tenant in the property with their first Canadian location in a 39,000 square foot flagship store. First Capital Realty is finalizing its leasing program that will be executed to secure tenant commitments and enhance value on the remaining 46,000 square feet of available space which is presently under construction and is expected to be ready for occupancy in late 2017.

The Company expects to advance the purchase price in August 2016. The advance will earn a return payable monthly by the vendor until completion of construction, which is expected during the second half of 2017. Closing of this transaction is subject to certain closing conditions typical for a transaction of this type.

Pusateri's Assembly, Avenue Road and Lawrence Avenue, Toronto

The Company has advanced a $39 million interim first mortgage loan and entered into an agreement of purchase and sale in respect of an assembly of properties including Toronto's well-known Pusateri's Fine Foods gourmet grocery store located at the northeast corner of Avenue Road and Lawrence Avenue in Toronto. The acquisition has a purchase price of approximately $63.2 million and remains subject to completion of satisfactory due diligence by the Company. For further details concerning this transaction, please refer to the Company's press release issued on August 3, 2016.

"The opportunity to acquire assets of this calibre in our core urban markets is quite rare. We are particularly pleased that our business is well positioned to capitalize on these infrequent opportunities to add exceptional properties that are consistent with our strategy, which has been the case this year," said Adam Paul, President and CEO.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

ABOUT FIRST CAPITAL REALTY (TSX:FCR)

First Capital Realty is one of Canada's largest owners, developers and managers of grocery anchored, retail-focused urban properties where people live and shop for everyday life. The Company currently owns interests in 161 properties, totaling approximately 25.2 million square feet of gross leasable area.

Forward-looking Statement Advisory

This press release contains forward-looking statements and information within the meaning of applicable securities law. Forward-looking statements can be identified by the expressions "expects", "believes", "estimates", "will" and similar expressions. The forward-looking statements are not historical facts but reflect the Company's current expectations regarding future results or events and are based on information currently available to Management. Certain material factors and assumptions were applied in providing these forward-looking statements.

Management believes that the expectations reflected in forward-looking statements are based upon reasonable assumptions; however, Management can give no assurance that the actual results or developments will be consistent with these forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under "Risks and Uncertainties" in First Capital Realty's Management's Discussion and Analysis for the year ended December 31, 2015 and under "Risk Factors" in its current Annual Information Form. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. First Capital Realty undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances except as required by applicable securities law.

All forward-looking statements in this press release are made as of the date hereof and are qualified by these cautionary statements.

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