The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from CNW Group

Scott's Real Estate Investment Trust announces refinancing

Tuesday, March 08, 2011

Scott's Real Estate Investment Trust announces refinancing17:49 EST Tuesday, March 08, 2011Enters into a $33-million First & Second Mortgage Successfully extends balance of original mortgage to February 1, 2012TORONTO, March 8 /CNW/ - Scott's Real Estate Investment Trust (TSX: SRQ.UN) ("Scott's REIT"), owner of 220 retail and restaurant properties in seven provinces across Canada, today announced that it entered into a first and second mortgage with Firm Capital Corporation in the amount of $33 million. The mortgage is secured by 70 properties located in Ontario the primary tenant on which is Priszm Income Fund.The REIT also received a further extension for its original $64-million mortgage to February 1, 2012 from July 1, 2011. The majority of the proceeds from the new financing were used to pay down the original mortgage. The remaining balance is now $32 million."Our business remains strong and we continue to demonstrate the strong financials needed to secure the financing for our operations," said Evelyn Sutherland, CFO of Scott's REIT. "This partial financing and extension of the original $64-million mortgage affords us the security to continue providing value to our unitholders as we focus on implementing our long-term growth strategy."The new mortgage with Firm Capital Corporation bears an initial interest rate at the greater of 6.25 per cent or prime rate plus two per cent in the first 12 months, rising to the greater of seven per cent or the prime rate plus 2.5 per cent in the following 12 months. In the last six months of the mortgage, the interest rate escalates to the greater of 7.5 per cent or prime rate plus 3.1 per cent. The new mortgage is open for payment at any time during the two and half year term and is due on October 1, 2013.About Scott's Real Estate Investment Trust Scott's REIT (TSX: SRQ.UN) is Canada's premier small-box retail property owner with 220 properties in seven provinces across Canada. Scott's REIT's properties are well-located and geographically diverse across Canada with the majority of all properties containing long-term quadruple net leases. The REIT has approximately 75.6 per cent interest in Scott's Real Estate LP. To find out more about Scott's Real Estate Investment Trust (TSX: SRQ.UN), visit our website at http://www.scottsreit.com. Forward-Looking StatementsThis document contains certain information that may constitute forward-looking information within the meaning of securities laws. In some cases, forward-looking information can be identified by the use of terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Forward-looking information may relate to management's future outlook and anticipated events or results, and may include statements or information regarding future growth opportunities and potential and expected cash distributions or cash distribution levels. In particular, information regarding the REIT's monthly cash distributions and information relating to the impact of the REIT's recent acquisitions on annual revenues and interest expense is forward-looking information. Forward-looking information is based on certain factors and assumptions regarding, among other things, occupancy rates, property expense and capital expenditures. While the REIT considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Forward looking-information is subject to certain factors, including risks and uncertainties, which could cause actual results to differ materially from what is currently expected. Such factors include risks relating to the REIT's reliance on Priszm LP, the REIT's largest tenant, risks associated with investment in real property, competition, reliance on key personnel, financing and refinancing risks, environmental matters, tenant risks, risks related to current economic conditions and other risk factors more particularly described in the REIT's Annual Information Form for the year ended December 31, 2009.You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. Other than as required by applicable Canadian securities law, the REIT does not undertake to update this information at any particular time. Additional information identifying risks and uncertainties is contained in Scott's REIT filings with the Canadian securities regulators, available at www.sedar.com.For further information: For investor information, please contact:  For media information, please contact:Trish MoranTrevor Boudreau416-624-5133604-564-8209trish.moran@scottsreit.comtrevor@tbcommunications.ca