Business
InterRent International Properties Inc. Announces Agreement To Sell GTA Property
InterRent International Properties Inc. Announces Agreement To Sell GTA Property.
About this update from Interrent Real Estate Investment Trust
[{"type":"text","content":"\n\n\n\n\nTSX-Venture-IIP\n\nTORONTO, Sept. 6 /CNW/ - InterRent International Properties Inc.,\n(\"InterRent\" or the \"Company\") today announced that it has entered into a\nbinding agreement of purchase and sale with an arm's length party for the sale\nof a ten (10) unit apartment building in Toronto's Parkdale district. The\ntransaction for which InterRent has received a $215,000 non-returnable\ndeposit, is scheduled to close on September 16, 2005.\nThe building was acquired by InterRent in the fall of 1999 for $667,000\nincluding all costs. The sale was transacted privately for a total\nconsideration of $850,000, or $85,000 per unit. As part of the purchase and\nsale agreement, InterRent will take back a $17,000 second mortgage for three\nyears at an annual interest rate of six percent (6%), with the balance in\ncash. After the discharge of an existing first mortgage of $348,000 including\nall costs, and a second mortgage of $70,000, InterRent will receive a total of\n$415,000 in cash. The net gain of $229,000 (34.3%) on the sale of the property\nwill be booked in the first quarter of 2006. Based on the selling price of the\nbuilding, InterRent realized an annual return of 17.8% on its original\ninvestment, not including operating profits generated during its ownership.\nCommenting on the divestiture, Michael Newman, President and CEO of the\nCompany stated, \"The sale of this property is in keeping with our previously\nstated strategy of disposing of smaller, non-strategic, non-core assets within\nthe Greater Toronto Area (GTA) at high per-unit valuations and low\ncapitalization rates, and re-deploying the funds obtained into larger, higher\ncapitalization rate buildings at lower per-unit prices, in smaller population\ncenters such as Hamilton, Kingston and Niagara Falls, Ontario. Management will\ncontinue to take advantage of opportunities to profitably divest of the\nCompany's smaller GTA properties as buyers are identified, with the exception\nof our strategically important King Street West buildings, which hold future\nre-development potential.\"\n\nInterRent is a rapidly expanding, growth oriented real estate company\nengaged in building shareholder value through the acquisition, ownership and\noperation of strategically located income producing multi-residential real\nestate, with 1,040 apartment suites under ownershi...