Business
Firm Capital Property Trust Announces the Acquisition of a 70% Interest in an Industrial Portfolio and 5% Distribution Increase
TORONTO , July 27, 2015 /CNW/ - Firm Capital Property Trust (" FCPT " or the " Trust ") (...
About this update from Firm Capital Property Trust
[{"type":"text","content":"\n\nTORONTO, July 27, 2015 /CNW/ - Firm Capital Property Trust (\"FCPT\" or the \"Trust\") (TSXV: FCD.UN) is pleased to announce the purchase of a 70% interest in seven industrial buildings located in Waterloo, Ontario (the \"Portfolio\"). The acquisition price for 100% of the Portfolio is approximately $43.3 million, excluding transaction costs. The capitalization rate is approximately 7%. The acquisition is expected to close during the third quarter of 2015.\n\nThe Portfolio is comprised of seven multi-tenant industrial buildings totaling 510,034 square feet. The Portfolio has in excess of 40 tenants with a weighted average lease term of approximately 4.0 years. The Portfolio is currently 100% occupied. \n\nThe entire Portfolio is being financed through the assumption of a $29.0 million first mortgage at a 2.95% interest rate and existing cash resources. 70% of the Portfolio will be acquired by the Trust, while the remaining 30% will be acquired by a private syndicate group. \n\nACQUISITION IMPACT ON THE TRUSTPro-forma the Portfolio acquisition, the Trust's Adjusted Funds From Operations (\"AFFO\") payout ratio is anticipated to be below 80% and Debt to Gross Book Value is expected to be approximately 50%. The Trust will increase the size of its current portfolio by approximately 34% to $122 million and will grow to 60 properties. \n\n5% DISTRIBUTION INCREASE IS THIRD INCREASE OR 20% OVERALL INCREASE IN LESS THAN THREE YEARSAs a result of the Portfolio acquisition and overall improved financial performance, the Trust will be increasing its annualized cash distribution by 5% to $0.42 per Trust Unit per annum or $0.035 per Trust Unit per month from $0.40 per Trust Unit per annum or $0.033333 per Trust Unit per month commencing in November, 2015 payable in December, 2015, subject to closing the Portfolio acquisition. This is the Trust's third distribution increase since its inception in late 2012 and represents total aggregate distribution increases of 20%. We anticipate this increased distribution to result in an AFFO payout ratio of below 85%.\n\nIn addition, the Trust announces that it has declared and approved monthly distributions in the amount of $0.033333 per Trust Unit for unitholders of record on October 30, 2015 payable on or about November 16, 2015 and $0.035 per Trust Unit for unitholders of record on November 30, 201...