TORONTO and DALLAS, Sept. 7, 2016 /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 Park 9 Apartments (“Park 9” or the “Property”), a 275-unit, Class A multifamily apartment community located in Woodstock, a suburb northwest of Atlanta, Georgia, for a purchase price of US$47.0 million, representing an estimated year one capitalization rate of 5.71% (the “Acquisition”). The Acquisition is expected to be accretive to the REIT.
The Property
Park 9 is located in the Northwest Atlanta suburb of Woodstock on Ridgewalk Parkway, which has immediate access to Interstate Highway 575, a heavily travelled freeway connecting the rapidly growing North Atlanta suburbs to major employment centers. Park 9 is in close proximity to the Outlet Shoppes of Atlanta, a 400,000 square-foot retail development, and downtown Woodstock, which offers restaurants, entertainment options and various community services.
Woodstock was named one of the top 50 places to live in the U.S. in 2015 by Money Magazine and benefits from favorable supply and demand trends with limited new multifamily construction. Over the last 10 years, only three new apartment communities have been developed in Woodstock. Milestone’s Harbor Creek property, located just six miles north of Park 9, has performed well since the REIT acquired the asset in May of 2014, benefiting from the area’s favourable employment, population and demographic trends. Park 9 will mark Milestone’s sixth acquisition in the Atlanta market over the past three years as the REIT continues to service the middle-market renter segment in high growth U.S. sunbelt markets.
Built in 2016, Park 9 is currently 95.0% occupied with average monthly rents of approximately US$1,200. Park 9’s average in-place rents are higher than the REIT’s portfolio average reflecting a higher percentage of two and three-bedroom apartment units and newly constructed units that offer high-end interior features and amenities. The Park 9 community features spacious living areas, nine-foot ceilings, stainless steel appliances, granite countertops and direct-access garages. Amenities include a clubhouse with a cyber café, a salt water swimming pool with beach entry and resort-style cabanas, an oversized fitness center, an outdoor grilling area, a bocce ball court, a dog park, storage units and electric vehicle charging stations.
Closing and Acquisition Funding
The Acquisition, which is subject to customary closing conditions, is expected to close by October 15, 2016. The REIT will disclose the final details of the purchase, including financing terms, following closing of the Acquisition.
About Milestone
The REIT is an unincorporated, open-ended real estate investment trust that is governed by the laws of Ontario. The REIT’s portfolio consists of 72 multifamily garden-style residential properties, comprising 22,546 apartment units that are located in 14 major metropolitan markets throughout the Southeast and Southwest United States. The REIT 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 approximately 1,500 employees and manages more than 50,000 apartment units 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 approximately US$10 billion in multifamily transactions. For more information, please visit www.milestonegp.com.
Forward-looking Information
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”, “estimated” and other similar expressions. Some of the specific forward-looking statements in this news release may include, but are not limited to, statements with respect to the future performance of the U.S. multifamily sector and the U.S. economy, the REIT’s financial performance and 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. 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 or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Non-IFRS Financial Measures
“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
Image with caption: “Milestone Apartments Real Estate Investment Trust (CNW Group/Milestone Apartments REIT)”. Image available at: http://photos.newswire.ca/images/download/20160907_C2853_PHOTO_EN_765977.jpg
