The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from CNW Group

NORTHWEST HEALTHCARE PROPERTIES REAL ESTATE INVESTMENT TRUST ANNOUNCES ACQUISITION OF PREMIERE EDMONTON MEDICAL OFFICE COMPLEX

Friday, December 24, 2010

NORTHWEST HEALTHCARE PROPERTIES REAL ESTATE INVESTMENT TRUST ANNOUNCES ACQUISITION OF PREMIERE EDMONTON MEDICAL OFFICE COMPLEX12:08 EST Friday, December 24, 2010TORONTO, Dec. 24 /CNW/ - NorthWest Healthcare Properties Real Estate Investment Trust (TSX: NWH.UN) (the "REIT") announced today it has entered into an agreement to acquire Hys Centre, Edmonton's most prominent medical office complex, strategically located on the Royal Alexandra Hospital campus. The purchase is expected to close in the first quarter of 2011, subject to customary closing conditions, and is expected to be immediately accretive and secure the REIT's dominance in the Edmonton medical office market.Hys Centre is a Class "A" office complex with underground pedway access to the large and expanding Royal Alexandra Hospital, Edmonton's leading surgical hospital. The property is composed of a 147,000 square foot medical office building, 50 residential apartments and a 384-stall pay parking facility. With more than 100 doctors, Hys Centre is over 96% occupied and has a long history of low vacancy and strong tenant retention. Hys Centre offers integrated healthcare services to the community, including medical consultation, diagnostic imaging, surgery and pharmacy.The purchase price will be approximately $53 million, subject to adjustments, which represents approximately a 6.7% capitalization rate applied to in-place annual net operating income or $286 per square foot of rentable area ($221 per square foot if the parking NOI is not included). Hys Centre will be acquired free and clear of any existing mortgages and will be refinanced on or shortly after closing. The equity portion of the REIT's investment will be funded from existing resources.The investment has the potential for value enhancement through incremental rental growth. In addition, the centre was designed to accommodate additional development on land that currently serves as surface parking.This investment will be the REIT's fourth Edmonton area property and its ninth asset in the Province of Alberta. The REIT believes that the acquisition of Hys Centre is strategically important and will further solidify its market leadership in healthcare real estate in Edmonton, in Alberta and in Canada.About NorthWest Healthcare Properties Real Estate Investment TrustNorthWest Healthcare Properties Real Estate Investment Trust, "Canada's Healthcare Landlord", is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. The REIT holds a portfolio of 50 income-producing properties, with a focus on medical office buildings and healthcare real estate, comprising approximately 3.1 million square feet of gross leasable area located in British Columbia, Alberta, Ontario, Québec, Nova Scotia and New Brunswick.Forward-Looking InformationThis press release may contain forward-looking statements with respect to the REIT, its operations, strategy, financial performance and condition. These statements generally can be identified by use of forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe", or "continue" or the negative thereof or similar variations. The REIT's actual results and performance discussed herein could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations, including that the transactions contemplated herein are not completed. Important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors (including changes in interest rates), competition, changes in government regulations, the performance of the acquired property, and the factors described under "Risk Factors" in the Short Form Prospectus dated October 22, 2010, including the risks and uncertainties set out in the Management Discussion and Analysis dated November 11, 2010 for the quarter ending September 30, 2010 included by reference therein, which are available on www.sedar.com. These cautionary statements qualify all forward-looking statements attributable to the REIT and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release, and, except as expressly required by applicable law, the REIT assumes no obligation to update such statements. Certain statements included in this news release may be considered "financial outlook" for purposes of applicable securities laws, and such financial outlook may not be appropriate for purposes other than this news release."Capitalization rate", "AFFO" and "Net operating income" (or NOI) are not measures recognized under Canadian generally accepted accounting principles ("GAAP") and do not have any standardized meanings prescribed by GAAP. Capitalization rate and NOI are presented in this press release because management of the REIT believes that these non-GAAP measures are relevant in interpreting the purchase price of the property being acquired. Capitalization rate, and NOI, 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 and NOI reported by such organizations. For additional information regarding each of the foregoing non-GAAP measures, including the definitions thereof, refer to the REIT's management's discussion and analysis for the three months ended September 30, 2010, a copy of which is filed on www.sedar.com.For further information: Peter Riggin, President, NorthWest Healthcare Properties Real Estate Investment Trust (416) 366-2000 ext. 224, or www.nwhp.ca