InStorage Real Estate Investment Trust
TSX VENTURE : IS.UN

InStorage Real Estate Investment Trust

December 21, 2006 17:54 ET

InStorage REIT Provides Update Concerning $35.9 Million of Self-Storage Investments

TORONTO, ONTARIO--(Marketwire - Dec. 21, 2006) -

NOT FOR DISTRIBUTION ON U.S. WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

Attention Business Editors:

InStorage Real Estate Investment Trust (the "REIT") (TSX VENTURE:IS.UN) announced today that the initial conditions have been waived in connection with its investments, together with InScotia Developments LP ("InScotia"), in a portfolio of 10 high quality self-storage properties (the "Properties") located in Western Canada and owned by Stor edge Self Storage. As a result, the investments will now proceed subject only to customary closing conditions and are scheduled to close on February 15, 2007.

The REIT will purchase three of the Properties that are operating on a stabilized basis (the "Stabilized Properties") for an aggregate purchase price of approximately $21.1 million. Two of the Stabilized Properties are located in Calgary, Alberta, and the third in Okotoks, Alberta. Collectively the Stabilized Properties represent approximately 190,000 square feet of net rentable area and approximately 1,300 self-storage units. The seven remaining Properties have not yet achieved stabilized operations (the "Non-Stabilized Properties") and will be acquired by InScotia with, among other sources of funding, mezzanine loan financing in the principal amount of approximately $14.8 million provided by the REIT pursuant to the terms of the development agreement between the REIT and InScotia.

The REIT will fund a portion of the purchase price for the acquisition of the Stabilized Properties and the mezzanine loan to InScotia described above with the net proceeds from its previously announced bought deal private placement scheduled to close on or about December 29, 2006. The remainder of the purchase price for the Stabilized Properties will be funded with the REIT's available cash on hand and secured bank financing.

InStorage Real Estate Investment Trust

InStorage REIT is an unincorporated open-ended real estate investment trust that invests primarily in self-storage properties and ancillary businesses throughout Canada. The REIT indirectly owns and/or operates 24 self-storage properties located in Ontario and Alberta.

Additional information concerning InStorage REIT may be obtained on the REIT's website, www.instoragereit.com, and on the SEDAR website at www.sedar.com, under the REIT's profile.

Forward-Looking Information

This press release contains forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the REIT to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Examples of such statements include the intention to complete the transactions mentioned above, as disclosed or at all. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this press release. Such forward-looking statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to: the ability of the REIT, its subsidiaries and InScotia Developments LP to obtain necessary financing and satisfy conditions under applicable transaction agreements; the level of activity in the underlying self-storage business of the REIT, the self-storage industry and in the economy generally; consumer interest in the services and products of the REIT's subsidiaries; competition; and anticipated and unanticipated costs. While the REIT anticipates that subsequent events and developments may cause its views to change, it specifically disclaims any obligation to update these forward-looking statements. These forward-looking statements should not be relied upon as representing the REIT's views as of any date subsequent to the date of this press release. Although the REIT has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The factors identified above are not intended to represent a complete list of the factors that could affect the REIT. Additional factors are noted under "Risks and Uncertainties" in the Management's Discussion and Analysis of the REIT for the interim period ended September 30, 2006, a copy of which may be obtained on the SEDAR website at www.sedar.com.

Contact Information

  • InStorage Real Estate Investment Trust
    T. James Tadeson
    Chief Executive Officer
    (416) 867-9705
    Website: www.instoragereit.com