Business
H&R REIT to Acquire One-Third Interest in Scotia Plaza - One of Canada's Preeminent Office Properties
/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/ ...
About this update from H&r Real Estate Investment Trust
[{"type":"text","content":"\n\n\n\n\n\n\n\n\n/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE\n UNITED STATES/\n\n\nTORONTO, May 22, 2012 /CNW/ - H&R Real Estate Investment Trust (\"H&R\n REIT\") (TSX: HR.UN; HR.DB; HR.DB.B; HR.DB.C; HR.DB.D; HR.DB.E) today\n announced that, together with Dundee REIT, it will acquire the iconic\n Scotia Plaza complex (\"Scotia Plaza\") in downtown Toronto for a total\n purchase price of approximately $1.266 billion. Under the arrangements,\n H&R REIT will own a one-third interest and Dundee REIT will own the\n remaining two-thirds interest. The sale is expected to close on or\n about June 20, 2012.\n\n\nHighlights:\n\n\nGoing-in capitalization rate of 5.2% - The $1.266 billion purchase price reflects an initial 5.2% going-in\n cap rate with contractual rental escalations thereafter.\n\n$650.0 million of 7-year first mortgage bonds to be issued - To provide partial funding of the purchase price, H&R REIT and Dundee\n REIT have entered into an underwriting agreement with Scotia Capital\n Inc. and TD Securities Inc. for $650.0 million of first mortgage bonds\n (100% interest) with a 7-year term at an effective interest rate that\n will not exceed 3.45%.  H&R REIT expects to fund the remaining purchase\n price with proceeds from the Bow mortgage bonds or other currently\n available credit facilities.\n\n\nOutstanding anchor tenant -Scotiabank, one of North America's premier financial institutions,\n will lease approximately 61% of Scotia Plaza for an average lease term\n of 13.5 years.  Scotiabank is an AA-rated financial institution.\n\n\nThomas Hofstedter, CEO of H&R REIT said:  \"The unparalleled location,\n scale, LEED Gold status, and prestigious tenant roster make Scotia\n Plaza one of Canada's preeminent trophy office buildings. Together with\n the completion and occupancy of the BOW, the recent acquisitions of\n Gotham Center (New York), Hess Tower (Houston), and Corus Quay\n (Toronto), Scotia Plaza continues H&R REIT's strategy of acquiring the\n highest quality office properties throughout North America.\"\n\n\nInvestment overview:\n\n\nH&R REIT will indirectly acquire a one-third interest in Scotia Plaza\n for a purchase price of approximately $422.2 million, equating to a\n value of $640 per square foot. \n\n\nTo finance H&R REIT's portion ...