BARRIE, ONTARIO -- (Marketwired) -- 09/01/14 -- Partners Real Estate Investment Trust ("Partners REIT" or "Partners" or "REIT") (TSX: PAR.UN) is pleased to provide an update on both the unwinding of its purchase of three retail centres from Holyrood Holdings ("Holyrood") and its sale of a small portfolio of Ontario properties. These items were discussed in detail within a press release entitled "Partners REIT Announces Strategic Steps to Improve Financial Position," disseminated on August 14, 2014.
HOLYROOD TRANSACTION UPDATE
Partners REIT has previously announced that it entered into a Rescission Agreement dated June 6, 2014 with Holyrood providing for the rescission of the April 2014 transaction in which the REIT acquired three Ontario retail centres (in Hamilton, London and Kemptville) from Holyrood for an aggregate purchase price of $83.2 million. Partners satisfied the purchase price for the three properties by assuming mortgage debt and directing its subsidiary, Partners Ontario Limited Partnership, to issue 4,813,517 exchangeable LP Units to Holyrood. Concurrently, Holyrood subscribed for 1,188,188 units of Partners REIT at $5.80 per unit and issued a promissory note to the REIT in payment. The purpose of the proposed rescission is to reverse all these transactions and put the parties, to the extent possible, back into the position they were in prior to the Holyrood transaction.
The REIT and Holyrood have now commenced an application to the Ontario Superior Court for an Order rescinding the original Agreement of Purchase and Sale together with the related agreements. The REIT has been advised by Holyrood that it is in the process of arranging for the release of the units of Partners Ontario LP and Partners REIT that it had pledged as collateral for a loan following the Holyrood transaction in April 2014. This release of the pledged units will allow the units to be cancelled upon the completion of the rescission. There are a number of conditions that must be satisfied before the rescission can be completed, including obtaining the Order from the Ontario Superior Court. Although Partners REIT and Holyrood are both very confident that they have the appropriate grounds to apply for the Court Order, there is no assurance that the rescission will be completed until all of the conditions are satisfied and the appropriate Court Order is received.
Although the Rescission Agreement provides that it will terminate on August 31, 2014 if the Court Order has not been obtained by that date, both Partners REIT and Holyrood have agreed to amend that provision and to continue to use their reasonable commercial efforts to accomplish the rescission.
Upon completion, the rescission will require the REIT to reissue its June 30, 2014 financial statements. These statements will be consistent with Note 3 of the previously issued June 30, 2014 statements published on August 14, 2014.
SALE OF ONTARIO PROPERTIES STATUS UPDATE
On August 14, 2014, Partners announced that it had entered into a conditional purchase and sale agreement with an unrelated third party ("Purchaser"). Partners and the undisclosed Purchaser have moved forward on satisfying a number of the conditions associated with the agreement but as of this date the transaction remains conditional.
About Partners REIT
Partners REIT is a growth-oriented real estate investment trust, which currently owns (directly or indirectly) 42 retail properties (including the Holyrood properties), located in British Columbia, Alberta, Manitoba, Ontario, and Quebec, aggregating approximately 3.2 million square feet of leasable space. Partners REIT focuses on expanding and managing a portfolio of retail and mixed-use community and neighbourhood shopping centres located in both primary and secondary markets across Canada.
Disclaimer
Certain statements included in this press release constitute forward-looking statements, including, but not limited to, those identified by the expressions "expect", "will" and similar expressions to the extent they relate to Partners REIT. The forward- looking statements are not historical facts but reflect Partners REIT's current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Although Partners REIT believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein.
Contacts:
Partners REIT Investor Relations
1 (844) 474-9620 ext. 401
investor.relations@partnersreit.com
Renmark Financial Communications Inc.
Barry Mire (514) 939-3989 or (416) 644-2020
bmire@renmarkfinancial.com
Renmark Financial Communications Inc.
Robert Thaemlitz (514) 939-3989 or (416) 644-2020
rthaemlitz@renmarkfinancial.com
www.renmarkfinancial.com
Media: Longview Communications
Joel Shaffer
(416) 649-8006
