Minto Apartment REIT To Provide Financing for a New Mixed-Use Development in Vancouver
- REIT Has an Option to Acquire an 85% Interest in the Property Following Stabilization at a 5% Discount to Market Value -
OTTAWA, ON, Dec. 1, 2021 /CNW/ - Minto Apartment Real Estate Investment Trust ("the REIT") (TSX: MI.UN) today announced an agreement to provide a convertible development loan of up to $19.6 million (the "Financing") to Minto Properties Inc. ("MPI") to finance MPI's 85% interest in a joint venture ("JV") with Comma Properties Limited Partnership ("CPLP"), the rental portfolio of Rize Alliance Assets Inc. The JV will develop a six-storey mixed-use building containing 108 residential rental suites and approximately 11,500 square feet of at-grade retail at 810 Kingsway, Vancouver B.C. (the "Project").
The Financing will bear interest at 6% per annum, which will accrue and be payable in full on the maturity of the loan. On stabilization of the property, which is expected in the summer of 2024, the REIT will have the exclusive option to purchase MPI's 85% interest in the Project at a 5% discount to its then-appraised fair market value.
810 Kingsway is centrally located in the heart of "The Fraserhood", a desirable community in East Vancouver, and has a walk score of 88. The neighbourhood is recognized for its mix of trendy restaurants, locally owned and operated retail shops, parks and community services, including schools and Mount St. Joseph's Hospital. It is located on a Frequent Transit Network bus route, which connects residents to downtown in 25 minutes.
The Project's 108 residential rental suites will range in size from 393-square foot bachelor suites to 1,054-square foot two-storey, three-bedroom townhomes. The Project's retail space will be located at-grade along Kingsway, with up to 10 retail units ranging in size from 900 to 1,600+ square feet. Amenities will include a large second-level roof deck with seating, barbeques, a children's play area, an urban agriculture area and an indoor amenity room.
CPLP is a 50-50 partnership between Rize Alliance Assets Inc. ("Rize"), a Vancouver-based developer, and Pioneer Investments Ltd. ("Pioneer"), a Vancouver-based investment management company.
"Expanding the REIT's presence in Metro Vancouver is one of our core strategies." said Michael Waters, Chief Executive Officer of the REIT. "I am also pleased to be working with Rize, who have been operating in the Metro Vancouver region since 1991 and have a current portfolio comprising 3,200 homes and 370,000 square feet of commercial space."
The REIT intends to fund the Financing through draws on its revolving credit facility. The Financing is secured by, among other things, a mortgage on the property and is guaranteed by MPI. The Financing will be subordinate to senior construction financing.
MPI is a related party to the REIT. Accordingly, the terms of the Financing were reviewed, considered and approved by a committee of the REIT's independent trustees.
About Minto Apartment Real Estate Investment Trust
Minto Apartment Real Estate Investment Trust is an unincorporated, open-ended real estate investment trust established pursuant to a declaration of trust under the laws of the Province of Ontario to own, develop, and operate income-producing multi-residential properties located in urban markets in Canada. The REIT owns a portfolio of high-quality income-producing multi-residential rental properties located in Toronto, Montréal, Ottawa, Calgary and Edmonton. For more information on Minto Apartment REIT, please visit the REIT's website at: www.mintoapartments.com.
About Rize Alliance Assets Inc.
Rize Alliance Assets Inc. ("Rize") is a Vancouver based full-service real estate development, construction management and property management company. Rize has been developing a mix of mixed-use residential and commercial projects throughout Metro Vancouver since 1991. For more information on Rize, please visit its website at: www.rize.ca.
About Pioneer Investments Ltd.
Pioneer Investments Ltd. ("Pioneer") has been active in Vancouver since 1997. As an investment and management company, it participates in individual projects and ongoing business operations by providing consulting services, participating in joint ventures and co-ownerships.
For more information on Pioneer, please visit its website at: www.pioneerinvestcanada.com.
About Comma Properties Limited Partnership.
Comma Properties Limited Partnership ("CPLP") is focused on building better rental communities. CPLP will bring an integrated approach to rental property management, residential community programming, and retail leasing. For more information on Comma, please visit its website at: www.commaproperties.ca
This news release may contain forward-looking information within the meaning of applicable securities legislation, which reflects the REIT's current expectations regarding future events and in some cases can be identified by such terms as "will" and "expected". Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the REIT's control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, the completion of the transactions contemplated in this news release in the manner anticipated, and the factors discussed under "Risk Factors" in the REIT's third quarter 2021 Management's Discussion and Analysis dated November 9, 2021, which is available on SEDAR+ (www.sedarplus.ca). The REIT does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law. This forward-looking information speaks only as of the date of this news release.
SOURCE MINTO Real Estate Investment Trust