TORONTO, Oct. 29, 2021 (GLOBE NEWSWIRE) — European Residential Real Estate Investment Trust (TSX:ERE.UN, “ERES” or the “REIT”) announced today that it has entered into an agreement to acquire a multi-residential property located in Rotterdam, the Netherlands (the “Willem Property”). Furthermore, the REIT is also pleased to announce that, through its subsidiary ERES Limited Partnership (“ERES LP”), it has amended and renewed its existing revolving credit facility, providing access to up to €100 million (approximately C$143 million) (the “New Revolving Credit Facility”).
The Willem Property is comprised of 63 residential units within a core Randstad sub-market and which are 100% owned and currently 100% leased. Closing is anticipated on or around November 30, 2021, and the €19.1 million (C$27.3 million) purchase price (excluding transaction costs and fees) will be financed using the New Revolving Credit Facility, with ultimate funding to come from long term mortgage financing.
The Willem Property consists of non-regulated units and is located nearby an existing building owned by ERES in the Prins Alexander borough of Rotterdam, providing operational synergy and efficiency as it will be managed by ERES’s existing property manager established in the region. Facilities such as schools and shopping centres are within a walking distance of the asset, which is situated in a neighbourhood characterized by its green space and parks, and with direct access to downtown Rotterdam via road or metro.
The New Revolving Credit Facility combines the REIT’s pre-existing revolving credit facility and bridge revolving credit facility into one facility, and is effective for a three-year period ending on October 29, 2024, which may be extended by the REIT for an additional one (1) year period available annually, upon the satisfaction of certain conditions. The New Revolving Credit Facility continues to be supported by a guarantee from CAPREIT Limited Partnership, the REIT’s largest unitholder and asset manager, and thereby facilitates lower interest rates and fees, alongside certain modifications to the financial covenants.
In addition, on September 29, 2021, the REIT secured mortgage financing on its June 30, 2021 acquisition properties, combined with refinancing of certain existing properties, in the total principal amount of €91.75 million. The mortgage bears a six-year term to maturity with a weighted average interest rate of 1.12% over the term of the mortgage, which lowered the REIT’s weighted average effective interest rate by eight basis points to 1.53%.
“ERES’s first acquisition of the fourth quarter will bring total 2021 acquisition volume to €66 million (excluding transaction costs and fees) across 200 residential suites, and we are optimistic to secure additional external growth as we head toward the new year,” commented Phillip Burns, CEO of ERES. “The amendment and renewal of our credit facility provides the means to act on upcoming opportunities, thereby re-solidifying ERES’s continued ability to pursue such growth-oriented objectives.”
ERES is an unincorporated, open-ended real estate investment trust. ERES’s Units are listed on the TSX under the symbol ERE.UN. ERES is Canada’s only European-focused, multi-residential REIT, with a current initial focus on investing in high-quality, multi-residential real estate properties in the Netherlands. ERES owns a portfolio of 141 multi-residential properties, comprised of 6,183 suites and ancillary retail space located in the Netherlands, and owns one office property in Germany and one office property in Belgium.
ERES’s 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.
Cautionary Statements Regarding Forward-Looking Statements
All statements in this press release that do not relate to historical facts constitute forward-looking statements. These statements represent ERES’s intentions, plans, expectations and beliefs and are subject to certain risks and uncertainties that could result in actual results differing materially from these forward-looking statements. These risks and uncertainties are more fully described in regulatory filings that can be obtained on SEDAR at www.sedar.com.
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|Mr. Phillip Burns||Mr. Stephen Co|
|Chief Executive Officer||Chief Financial Officer|