/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES./
TORONTO, Sept. 24, 2019 /CNW/ - European Residential Real
Estate Investment Trust (TSX-V:ERE.UN, "ERES" or the "REIT")
announced today that it has completed its previously announced
issue and sale of 40,185,000 trust units of ERES (the "Units") for
$4.15 per Unit for aggregate gross
proceeds of $166,767,750, which
includes the exercise in full of the over-allotment option (the
"Offering"). The Offering was sold through a syndicate of
underwriters led by RBC Capital Markets and Scotiabank.
ERES intends to use the net proceeds from the Offering to
partially finance the previously announced portfolio acquisitions
described in ERES' September 16, 2019
press release (the "Acquisitions"), to repay the approximately
€22.5 million outstanding balance on ERES' existing credit
facility, to fund future acquisitions, and for general trust
purposes. The Offering and Acquisitions are expected to result in
ERES' Debt to Gross Book Value ratio being approximately 48%.
CAPREIT's Ownership
As a part of the Offering, Canadian Apartment Properties Real
Estate Investment Trust (TSX:CAR.UN, "CAPREIT") acquired 4,820,000
Units for $4.15 per Unit. As a
result, CAPREIT beneficially owns, controls or exercises direction
over 4,820,000 Units and 140,903,682 class B limited partnership
units of ERES Limited Partnership (the "Class B LP Units"), a
subsidiary of ERES, representing approximately 73.4% of the issued
and outstanding Units, assuming all Class B LP Units are exchanged
for Units. The Class B LP Units are convertible on a one-to-one
basis into Units. Immediately before the completion of the
Offering, CAPREIT owned, controlled or exercised direction over
140,903,682 Class B LP Units, representing approximately 89% the
issued and outstanding Units and Class B LP Units. Subject to the
terms set out in the investor rights agreement dated March 29, 2019 between CAPREIT and ERES, CAPREIT
may seek to sell or otherwise dispose of some or all of ERES'
securities (which may include, but is not limited to, transferring
some or all of such securities to its affiliates) from time to
time, and/or may seek to acquire additional securities of ERES
(which may include rights or securities exercisable or convertible
into securities of ERES) from time to time, in each case, in
open market or private transactions, block sales or acquisitions or
otherwise.
After closing of the Acquisitions, which is expected to occur by
September 30, 2019, CAPREIT's
ownership is expected to increase to approximately 74% of the
issued and outstanding Units (assuming all Class B LP Units are
exchanged for Units), as a result of the approximately C$5.0 million of Class B LP Units that will be
issued to CAPREIT as partial consideration, at a price per Class B
LP Unit equal to the weighted average trading price of the trust
units on the TSX Venture Exchange (the "TSX-V") for the five
trading days immediately preceding the closing of the Acquisitions,
subject to TSX-V rules.
This press release is issued pursuant to the early warning
requirements of National Instrument 62-103, which also requires a
report to be filed containing additional information with respect
to the foregoing matters (the "Early Warning Report"). A copy of
the Early Warning Report will appear under ERES' profile on the
SEDAR website at www.sedar.com.
ABOUT ERES
ERES is an unincorporated, open-ended real
estate investment trust. ERES' Units are listed on the TSX-V under
the symbol ERE.UN. ERES is Canada's only European-focused
multi-residential REIT, with an initial focus on investing in
high-quality multi-residential real estate properties in
the Netherlands. ERES currently
owns a portfolio of 88 multi-residential properties, comprised of
3,859 suites located in the
Netherlands, and owns two office properties in Germany and one office property in
Belgium.
ERES' registered and principal business office is located at 11
Church Street, Suite 401, Toronto,
Ontario M5E 1W1.
For more information, please visit our website at
www.eresreit.com.
ABOUT CAPREIT
As one of Canada's largest residential landlords,
CAPREIT is a growth-oriented investment trust managing 62,645
suites and sites across Canada,
the Netherlands and Ireland. It owns 59,023 residential units,
comprising of 47,346 residential suites and 72 manufactured home
communities comprising 11,677 land leases sites located in and near
major urban centres across Canada
and The Netherlands. For more
information about CAPREIT, its business and its investment
highlights, please refer to our website at www.caprent.com or
www.capreit.net and our public disclosure which can be found under
our profile at www.sedar.com.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING
STATEMENTS
Certain statements contained in this press
release constitute forward-looking statements within the meaning of
applicable Canadian securities laws which reflect ERES' current
expectations and projections about future results. Forward-looking
statements generally can be identified by the use of
forward-looking terminology such as "outlook", "objective", "may",
"will", "expect", "intent", "estimate", "anticipate", "believe",
"consider", "should", "plans", "predict", "estimate", "forward",
"potential", "could", "likely", "approximately", "scheduled",
"forecast", "variation" or "continue", or similar expressions
suggesting future outcomes or events. The forward-looking
statements made in this press release relate only to events or
information as of the date on which the statements are made in this
press release. Actual results and developments are likely to
differ, and may differ materially, from those expressed or implied
by the forward-looking statements contained in this press release.
Such forward-looking statements are based on a number of
assumptions that may prove to be incorrect.
Except as specifically required by applicable Canadian
securities law, ERES does not undertake any obligation to update or
revise publicly any forward-looking statements, whether as a result
of new information, future events or otherwise, after the date on
which the statements are made or to reflect the occurrence of
unanticipated events. These forward-looking statements should not
be relied upon as representing ERES' views as of any date
subsequent to the date of this press release. There can be no
assurance that forward-looking statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements.
Neither the TSX-V nor its Regulation Services Provider (as that
term is defined in the policies of the TSX-V) have in no way passed
upon the merits of the Acquisitions or the Offering and have
neither approved nor disapproved the contents of this news
release.
This press release shall not constitute an offer to sell, or the
solicitation of an offer to buy, any securities of ERES in any
jurisdiction in which such offer, solicitation or sale would be
unlawful. The securities being offered have not been and will not
be registered under the U.S. Securities Act of 1933, as amended, or
any state securities laws, and may not be offered or sold in
the United States or to U.S.
persons absent registration or pursuant to applicable exemption
from registration.
SOURCE European Residential Real Estate Investment Trust
