TORONTO, March 28, 2018 /CNW/ - Summit Industrial Income
REIT ("Summit" or the "REIT") (TSX: SMU.UN) announced today that it
has waived conditions and will acquire 100% of a distribution
warehouse totaling 141,034 square feet of gross leasable area
located in Stratford, Ontario. The
building is leased to Samsonite Canada, a global manufacturer and
retailer of consumer durable goods, under a twelve-year lease with
contractual lease escalations. The property is a brand new,
build-to-suit facility with clear 36 foot ceiling heights and the
potential for future expansion based on tenant demand. The REIT
will pay $14.9 million for the
property, financed by a new $10.0
million five-year mortgage with an expected 3.82% interest
rate, with the balance in cash from the REIT's credit lines,
generating a very strong 6.0% capitalization rate. The REIT expects
to close the transaction on or before June
1, 2018.
The REIT also announced today that it has replaced the
$90.0 million bridge facility
established late in 2017 with $88.0
million in new mortgages on recently acquired properties
with a weighted average term of ten years and an interest rate of
4.1%. The bridge facility was due to expire in September 2018. With these new mortgages,
approximately 10.0% of the REIT's total debt now incurs a floating
interest rate.
"We are very pleased to be increasing our presence in the strong
Southwestern Ontario region and
enhancing the quality and average age of our portfolio with the
acquisition of this brand new property," commented Paul Dykeman, Chief Executive Officer. "We are
also pleased to be replacing the bridge facility with these
long-term mortgage financings, further strengthening the stability
and predictability of our cash distributions to Unitholders."
About Summit
Summit Industrial Income REIT is an
unincorporated open-end trust focused on growing and managing a
portfolio of light industrial properties across Canada. Summit's units are listed on the TSX
and trade under the symbol SMU.UN. For more information, please
visit our web site at www.summitIIreit.com.
Caution Regarding Forward Looking Information
This
news release contains forward-looking statements and
forward-looking information within the meaning of applicable
securities laws. The use of any of the words "expect",
"anticipate", "continue", "estimate", "objective", "ongoing",
"may", "will", "project", "should", "believe", "plans", "intends",
"goal" and similar expressions are intended to identify
forward-looking information or statements. More particularly and
without limitation, this news release contains forward looking
statements and information concerning the goal to build Summit's
property portfolio. The forward-looking statements and information
are based on certain key expectations and assumptions made by
Summit, including general economic conditions. Although Summit
believes that the expectations and assumptions on which such
forward-looking statements and information are based are
reasonable, undue reliance should not be placed on the forward
looking statements and information because Summit can give no
assurance that they will prove to be correct. By its nature, such
forward-looking information is subject to various risks and
uncertainties, which could cause the actual results and
expectations to differ materially from the anticipated results or
expectations expressed. These risks and uncertainties include, but
are not limited to, tenant risks, current economic environment,
environmental matters, general insured and uninsured risks and
Summit being unable to obtain any required financing and approvals.
Readers are cautioned not to place undue reliance on this
forward-looking information, which is given as of the date hereof,
and to not use such forward looking information for anything other
than its intended purpose. Summit undertakes no obligation to
update publicly or revise any forward-looking information, whether
as a result of new information, future events or otherwise, except
as required by law.
SOURCE Summit Industrial Income REIT