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TORONTO and DALLAS, March 16, 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 the Village at Almand Creek (“Almand Creek” or the “Property”), a 236-unit, Class A multifamily apartment community located in the Conyers submarket of East Atlanta, Georgia, for a purchase price of US$24 million, representing an estimated year one capitalization rate of 6.7% (the “Acquisition”). The Acquisition is expected to be accretive to the REIT.
“Almand Creek is another off-market acquisition sourced to the REIT through our network of industry relationships. We look forward to increasing our presence in the Atlanta market as we continue expanding and further diversifying the REIT’s portfolio. With over 138,000 jobs added since 2011, Atlanta has one of the fastest growing economies in the country,” said Robert Landin, CEO of Milestone.
The Property
Almand Creek was built in 2002 and is currently 94.9% occupied, with average monthly rents of approximately US$985. The Property’s average in-place rent per square foot is consistent with the REIT’s portfolio and Milestone’s middle market strategy. The Property’s average in-place rents are higher than the REIT’s portfolio average in part due to a higher proportion of two and three-bedroom apartment suites. The Property has convenient access to major transportation corridors, including I-20 providing direct access to downtown Atlanta, and I-285, Atlanta’s perimeter interstate highway. It is located within close proximity to several large employers, including Rockdale County Public Schools district administration, Rockdale Medical Center and AT&T. Almand Creek is the nearest multifamily community in the vicinity of the large, new Baxter International facility currently being built in nearby Covington, Georgia. As the Property is located right off of Highway 138, Conyers’ major retail corridor, residents have a wide variety of shopping, dining and entertainment options nearby. Almand Creek features extensive amenities consistent with the REIT’s established portfolio, including a resort style pool, tennis court, an outdoor children’s playground and a nature trail.
Acquisition Closing
The Acquisition, which is subject to customary closing conditions, is expected to close by May 1, 2015. The REIT will disclose the final details of the purchase, including financing terms, following closing of the Acquisition.
March 2015 Distribution
The REIT has declared a cash distribution of C$0.05417 per REIT unit for the month of March, representing C$0.65 per REIT unit on an annualized basis. Payment will be made on April 15, 2015 to unitholders of record as at March 31, 2015.
About Milestone
Milestone is an unincorporated, open-ended real estate investment trust that is governed by the laws of Ontario. The REIT’s portfolio consists of 58 multifamily garden-style residential properties, comprising 19,441 units that are located in 13 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 initial capitalization rate of the proposed acquisition, the effect of the proposed acquisition on the financial performance of the REIT (including the degree to which the acquisition will be accretive), the ability to enhance the value of Almand Creek through the implementation of Milestone’s operating efficiencies and unit enhancement program. 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 Almand Creek 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 1 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
