– Expands presence in growing Dallas-Fort Worth metro region –
TORONTO and DALLAS, Aug. 26, 2015 /CNW/ – Milestone Apartments Real Estate Investment Trust (TSX: MST.UN) (“Milestone” or the “REIT”) today announced that it has entered into an agreement to purchase Broadstone Vista Ridge (“Broadstone” or the “Property”), a 372-unit, Class A multifamily apartment community located in the Lewisville submarket of Dallas, Texas, for a purchase price of US$45.1 million, representing an estimated year one capitalization rate of 6.72% (the “Acquisition”). The Acquisition is expected to be accretive to the REIT.
“The acquisition of Broadstone represents another off-market opportunity for Milestone and will further expand the REIT’s presence in the Dallas-Fort Worth market, one of the fastest growing markets in the U.S.,” said Robert Landin, CEO of Milestone.
Built in 2006, Broadstone is currently approximately 95% occupied, with average monthly rents of approximately US$1,050. The Property’s average in-place rents are higher than the REIT’s portfolio average in part due to a higher percentage of two and three-bedroom apartment suites. Broadstone includes one, two and three-bedroom units that feature spacious living areas, nine-foot ceilings, modern design, and gourmet kitchens. Amenities include a fitness center, a resort-style swimming pool with an outdoor fireplace, multimedia center, and a cyber cafÃ©. The Property is centrally located within the Dallas-Fort Worth metroplex and has convenient access to major transportation corridors, including the Sam Rayburn Tollway / State Highway 121, I-35, and the President George Bush Turnpike. Several large employment centers are located in close proximity to the Property, including the Dallas-Fort Worth International Airport, Las Colinas Urban Center and the Legacy Business Park, the site of corporate campuses for Toyota Motor Corporation’s new North American headquarters, Liberty Mutual Insurance and FedEx Corporation. The 1.4 million square foot Vista Ridge Mall is located 1.5 miles from the Property and features several large national retailers, more than 130 specialty stores, as well as several dining and entertainment options.
Acquisition Funding and Closing
The Acquisition, which is subject to customary closing conditions, is expected to close by September 30, 2015. The REIT will disclose the final details of the purchase, including financing terms, following closing of the Acquisition.
Milestone is an unincorporated, open-ended real estate investment trust that is governed by the laws of Ontario. The REIT’s portfolio consists of 61 multifamily garden-style residential properties, comprising 20,232 units that are located in 14 major metropolitan markets throughout the Southeast and Southwest United States. Milestone is the largest real estate investment trust listed on the TSX focused solely on the United States multifamily sector. The REIT operates its portfolio through its internal property management company, Milestone Management, LLC, which has more than 900 employees across the United States. Based in Dallas, TX, TMG Partners, L.P., an affiliate of The Milestone Group, LLC, is the external asset manager of the REIT. For more information, please visit www.milestonereit.com.
About The Milestone Group, LLC
The Milestone Group is a privately-held real estate investment management company with expertise and presence in major metropolitan markets throughout the United States. The firm has corporate offices in Dallas, Texas and New York, New York with regional acquisition and management offices across the United States. Founded in 2004, The Milestone Group has a strong track record of investing in the U.S. multifamily sector, including completion of more than US$4.5 billion in multifamily transactions. For more information, please visit www.milestonegp.com.
Forward-looking information and non-IFRS measures
This news release may contain forward-looking statements (within the meaning of applicable securities laws) relating to the business of the REIT and the environment in which it operates. Forward-looking statements are identified by words such as “believe”, “anticipate”, “expect”, “intend”, “plan”, “will”, “may”, “estimate” and other similar expressions. These statements are based on the REIT’s expectations, estimates, forecasts and projections and include, without limitation, statements regarding the anticipated closing date of the proposed acquisition, the year one capitalization rate of the proposed acquisition, and the effect of the proposed acquisition on the financial performance of the REIT (including the degree to which the acquisition will be accretive). They are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under the heading “Risk Factors” in the REIT’s annual information form available at www.sedar.com. The forward-looking statements in this news release are based on certain assumptions, including that the economy remains stable, rental rates at Broadstone will continue to grow, interest rates remain stable, and the REIT will continue to have access to capital. There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in these forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, the REIT assumes no obligation to publicly update any such statement, whether as a result of new information, future events or otherwise.
“Year one capitalization rate” is not a measure recognized under IFRS and does not have a standardized meaning prescribed by IFRS. Year one capitalization rate is presented in this news release because management of the REIT believes that this measure is relevant in interpreting the purchase price of the Property. Capitalization rate, as computed by the REIT, may differ from similar computations as reported by other similar organizations and, accordingly, may not be comparable to capitalization rate reported by such other organizations.
SOURCE Milestone Apartments REIT