Partners Real Estate Investment Trust
TSX : PAR.UN

Partners Real Estate Investment Trust

November 10, 2014 16:38 ET

Partners REIT Completes Previously Announced Refinancing of Five Properties and Debt Repayments

BARRIE, ONTARIO--(Marketwired - Nov. 10, 2014) - Partners Real Estate Investment Trust ("Partners" or the "REIT") (TSX:PAR.UN) is pleased to announce the completion of all of the refinancings previously announced on November 3, 2014, in a press release entitled "Partners Announces Refinancing of Five Properties and Debt Repayments."

As previously announced, the refinancing consists of first mortgages that will amount to an aggregate of $51 million on the following properties:

  • Manning Crossing, Edmonton Alberta;
  • King George Square, Brantford, Ontario;
  • Centre Village, Montreal, Quebec;
  • Centuria Urban Village, Kelowna, British Columbia; and,
  • Crossing Bridge, Stittsville, Ontario.

Partners refinanced these five properties with the aim of providing the REIT with the capital necessary to both fund property improvements and allow for increased certainty regarding the REIT's future interest costs. These first mortgages carry an average weighted interest rate of 3.74% and an average term to maturity of 6.9 years. When originally announced, two of the first mortgages had already been completed. With the other three first mortgages now closed, the REIT has fully dispersed the funds as follows:

  • repayment in full of the $35 million outstanding amount on the REIT's $40 million credit facility; and
  • $12 million as repayment in full of two long term mortgages on one property;

The remaining balance of $4 million, net of costs, has increased the REIT's cash position. These funds will be utilized to improve the quality of the REIT's existing property portfolio via their deployment towards projects that feature what the REIT believes will be high returns on the investment.

The refinancing also includes a $10 million line of credit that has been secured by second mortgages on three of the refinanced properties and will bear interest at a rate of prime plus 2.0% with a term of two years. The REIT does not currently anticipate requiring significant use of this line of credit within the near future. This facility has been obtained to provide short term liquidity, as operating cash flows may require.

"Partners' Trustees fully support the REIT's management team in securing these refinancings," stated Joseph Feldman, the REIT's Chairman. "As a result of these refinancings, Partners will not only benefit from a stabilization of its cash flow, but also gain greater financial flexibility moving forward."

All of the above refinancings were originated by First National LP, a wholly owned subsidiary of First National Financial (TSX:FN)(TSX:FN.PR.A). Upon completion of all of the refinancings, First National LP and its institutional partners received an aggregate fee of $238,875, and First National LP will also collect fees for servicing certain of the new mortgages. Upon closing the refinancings, First National LP, which has originated mortgages previously for the REIT, has provided mortgage financing for the REIT's current properties in the total amount of $116 million. Moray Tawse, a significant unitholder of the REIT, has an interest in First National.

About Partners REIT

Partners REIT is a growth-oriented real estate investment trust focused on the expansion and management of a portfolio of 36 retail and mixed-use community and neighbourhood shopping centres. These properties are located in both primary and secondary markets across British Columbia, Alberta, Manitoba, Ontario, and Quebec, and comprise a total of approximately 2.5 million square feet of leasable space.

Disclaimer

Certain statements included in this press release constitute forward-looking statements, including, but not limited to, those identified by the expressions "expect", "will" and similar expressions to the extent they relate to Partners REIT. The forward- looking statements are not historical facts but reflect Partners REIT's current expectations regarding future results or events. 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. Although Partners REIT believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein.

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