Northview Apartment REIT Announces $197 Million Strategic Acquisition of 1,250 Units in Key Growth Markets

CALGARY, ALBERTA–(Marketwired – Nov. 15, 2017) – Northview Apartment Real Estate Investment Trust (“Northview”) (TSX:NVU.UN) today announced it has agreed to acquire a 1,250 unit portfolio from independent third-party vendors and affiliates of Starlight Group Property Holdings Inc. (“Starlight”), for an aggregate purchase price of $196.8 million, with a weighted average capitalization rate of 4.4%. In addition, Northview has agreed to a sale, to an independent third-party vendor, of a 216 unit non-core asset located in Kitchener, ON, for $37.7 million. Following these transactions, which are expected to close in early December 2017, Northview's multi-family portfolio will increase to over 25,000 units.

Todd Cook, President and CEO, commented, “These transactions represent continued progress to our 2017 strategic priorities supporting the strategic capital redeployment and non-core asset sales. These high-quality assets are located in strong markets with an average occupancy level of 97.5%. It will further improve the overall geographic diversification and quality of our portfolio with a meaningful increase in the Ontario portfolio. This transaction also increases strong organic growth opportunities for our proven high-end renovation program.”

Mr. Cook concluded, “The acquisition is expected to be leverage neutral following future non-core asset sales. In an extremely competitive market landscape, these off-market transactions demonstrate the benefits of Northview's strategic relationship with Starlight and our continued focus on driving sustainable value creation for Unitholders.”

Summary of the Transaction

Property City Units
Ontario
2837 Yonge Street Toronto 67
320 – 342 Avenue Road (1) Toronto 109
2920 Fairlea Crescent Ottawa 113
340 Colborne Street London 132
204 Hespeler Road Cambridge 146
24 – 28 Helen Avenue Brantford 284
851
Quebec
939 – 959 Boulevard de la Cote Vertu Saint Laurent 89
105 Milton Street Montreal 112
201
British Columbia
7840 Lochside Drive (1) Saanichton 126
126
Nova Scotia
9 – 54 Paige Plaza Lower Sackville 72
72
Total 1,250

(1) Properties acquired from Starlight.

The aggregate purchase price of $196.8 million for the acquisition will be funded by:

  • Insured mortgage debt relating to the acquisition of approximately $121.9 million;
  • Issuance of $52.0 million in Trust Units and Class B LP Units to the vendors valued at Northview's five day volume weighted average unit price prior to the closing date; and
  • Cash consideration of $22.9 million funded by existing credit facilities and proceeds from the non-core asset sale in Kitchener, ON.

Related Party Transaction

The transactions include the acquisition of two properties from Starlight for total consideration of $58.2 million, including the issuance of $14.0 million in Class B LP Units to Starlight. In conjunction with the transactions, a fee of $1.6 million is payable to Starlight from Northview in accordance with the Transitional Service Agreement. The transactions were unanimously approved by the independent Trustees of Northview.

About Northview

Northview is one of Canada's largest publicly traded multi-family REITs. Prior to this transaction, Northview's portfolio consist of approximately 24,000 quality residential suites in more than 60 markets across eight provinces and two territories. Northview's portfolio includes markets characterized by expanding populations, growing economies, high occupancy levels, and rising rents, which provides Northview the means to deliver stable and growing profitability and cash distributions to Unitholders of Northview over time. Northview currently trades on the TSX under the ticker symbol: NVU.UN. Additional information concerning Northview is available at www.sedar.com or www.northviewreit.com.

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About the Author: Carrie Brunner

Carrie Brunner grew up in a small town in northern New Brunswick. She studied chemistry in college, graduated, and married her husband one month later. They were then blessed with two baby boys within the first four years of marriage. Having babies gave their family a desire to return to the old paths – to nourish their family with traditional, homegrown foods; rid their home of toxic chemicals and petroleum products; and give their boys a chance to know a simple, sustainable way of life. They are currently building a homestead from scratch on two little acres in central Texas. There’s a lot to be done to become somewhat self-sufficient, but they are debt-free and get to spend their days living this simple, good life together with their five young children. Carrie writes mostly on provincial stories.
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