TORONTO, Dec. 17, 2018 /CNW/ - Granite Real Estate
Investment Trust ("Granite") (TSX: GRT.UN / NYSE:
GRP.U) announced today that its board of trustees has declared
a monthly distribution of CDN$0.233
per stapled unit. The monthly distribution will be paid by
Granite on January 15, 2019 to
stapled unitholders of record at the close of trading on
December 31, 2018.
Granite's board of trustees has also declared a special
distribution of CDN$1.200 per stapled
unit, which will comprise CDN$0.300
per stapled unit payable in cash and CDN$0.900 per stapled unit payable by the
issuance of stapled units based on the closing market price of the
stapled units on the Toronto Stock Exchange on December 31, 2018. The cash portion of the
special distribution is intended to provide liquidity to
unitholders to cover all or part of any non-resident withholding
taxes or other income tax obligations that may arise from the
additional taxable income being distributed via the special
distribution. Concurrently with the issuance of stapled units
pursuant to the special distribution, the outstanding stapled units
of Granite will be consolidated such that each unitholder will
hold, after the consolidation, the same number of stapled units as
such stapled unitholder held before the special
distribution. The special distribution will be made by Granite
on January 15, 2019 and will be
payable at the close of trading on December
31, 2018 to stapled unitholders of record at that time.
The stapled units will begin trading on an ex-dividend basis at
the opening of trading on Friday, December
28, 2018 on the Toronto Stock Exchange and on the New York
Stock Exchange.
TAX CONSIDERATIONS
Granite cautions that these
comments are not intended to be, and should not be construed as,
legal or tax advice to any particular unitholder. Granite
recommends that unitholders consult their own tax advisors
regarding the Canadian, U.S. federal and state income tax
consequences and filing requirements.
Granite confirms that no portion of the monthly distribution or
special distribution constitutes effectively connected income for
U.S. federal tax purposes. A qualified notice providing the
breakdown of the sources of the distributions will be issued to the
Depository Trust & Clearing Corporation subsequent to the
record date of December 31, 2018,
pursuant to United States Treasury Regulation Section 1.1446-4.
Certain Canadian Federal Income Tax
Considerations
Canadian Resident unitholders (i.e.
unitholders that are resident in Canada for Canadian Income Tax Act purposes)
will generally be required to include in their computation of
income the amount of net income or taxable capital gains as
determined by the Canadian Income Tax Act distributed to them by
Granite during the 2018 taxation year or that become payable to
them in 2018 including by virtue of the special distribution. Any
return of capital distributions made by Granite during the year or
that become payable in the year, will reduce the cost basis of such
unitholders' stapled units. This issuance of stapled units in
satisfaction of the unit portion of the distribution will add to
the aggregate tax cost basis of Canadian Resident unitholders'
units, and such aggregate basis will not change as a result of the
consolidation.
Certain U.S. Federal Income Tax
Considerations
U.S. Resident unitholders (i.e.
unitholders that generally are (i) citizens or residents of
the United States, (ii)
corporations organized in the United
States or any state or other political subdivision thereof,
(iii) estates, if the income of the estate is subject to U.S.
federal income taxation regardless of its source, or (iv) trusts,
if a court within the United
States is able to exercise primary supervision over the
trust's administration and one or more U.S. persons have authority
to control all of the trust's substantial decisions) will generally
be required to include their proportionate share of Granite's
taxable income, including capital gains as determined by the Code,
for the 2018 taxation year in computing their taxable
income. The cost basis of such unitholders' stapled units will
increase by their proportionate share of the taxable income and
will decrease by the amount of distributions paid by Granite. The
issuance of stapled units and concurrent consolidation of stapled
units will not affect U.S. Resident unitholders as it relates to
U.S. federal taxes. However, similar to Granite's regular monthly
distribution, Granite expects U.S. Resident unitholders will be
subject to 25% Canadian non-resident withholding tax. The U.S.
federal, state and local tax consequences to a unitholder of the
transactions described above are complex and this summary of tax
considerations is general in nature. Accordingly, each unitholder
is urged to consult its own tax advisor regarding such tax
consequences.
ABOUT GRANITE
Granite is a Canadian-based REIT engaged in the acquisition,
development, ownership and management of industrial, warehouse and
logistics properties in North
America and Europe. Granite
owns over 85 investment properties representing approximately 33
million square feet of leasable area.
OTHER INFORMATION
Copies of financial data and other publicly filed documents
about Granite are available through the internet on the Canadian
Securities Administrators' Systems for Electronic Document Analysis
and Retrieval (SEDAR) which can be accessed at www.sedar.com and on
the United States Securities and Exchange Commission's Electronic
Data Gathering, Analysis and Retrieval System (EDGAR) which can be
accessed at www.sec.gov. For further information, please see our
website at www.granitereit.com or contact Kevan Gorrie, President and Chief Executive
Officer, at 647-925-7500 or Ilias
Konstantopoulos, Chief Financial Officer, at
647-925-7540.
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SOURCE Granite Real Estate Investment Trust