Year-to-date acquisitions total $381 million
Toronto, Ontario (September 23, 2011) – First Capital Realty Inc. (“First Capital Realty”) (TSX:FCR), Canada’s leading owner, developer and operator of supermarket and drugstore anchored neighbourhood and community shopping centres located predominantly in growing metropolitan areas, today announced $181 million of new acquisitions and a disposition of $42.6 million. In addition, the Company announced the assignment of leases for 17 of the 19 Zellers locations in its portfolio.
$224 Million of Property Transactions
First Capital Realty has entered into a binding agreement to purchase Hazelton Lanes, a 205,000 square foot shopping centre with 517 stalls of underground parking, which is centrally located in Yorkville, Canada’s premier shopping district and one of Toronto, Ontario’s most affluent neighbourhoods. Hazelton Lanes is anchored by a 50,000 square foot Whole Foods grocery store and presents significant repositioning opportunities. The shopping centre consists of strata title to two retail levels, a small office component and two levels of underground parking. The balance of the mixed use complex, which is not part of the acquisition, includes 124 residential condominiums above the shopping centre.
The acquisition is expected to be completed in October 2011 and remains subject to customary closing conditions. The purchase price of approximately $110 million, including closing costs, will be satisfied by a combination of cash and the assumption of $58 million of existing fixed rate debt with an annual interest rate of 5.62% and maturing in June 2016.
On August 15, 2011, First Capital Realty completed the acquisition of Macleod Plaza, a 124,000 square foot shopping centre situated on 7.8 acres of land on Macleod Trail, one of Calgary, Alberta’s busiest commercial retail corridors. The property is adjacent to the Company’s Macleod Trail RONA and Bank of Montreal and near the Company’s Newport Village shopping centre. Tenants include Dollarama, Shoppers Home Health Care and a recently vacated Office Depot. The purchase price of $34.3 million, including closing costs, was satisfied by a combination of cash and the assumption of $13.4 million of existing fixed rate debt with an annual interest rate of 5.54% and maturing in January 2015.
On September 20, 2011, First Capital Realty also acquired Longstreet Shopping Centre, a 44,500 square foot property situated on 3.5 acres of land located in Edmonton, Alberta. The shopping centre has 1,500 feet of frontage on 104th Avenue, an intensified urban east-west corridor directly north of the downtown core. Longstreet Shopping Centre is across the street from Grant MacEwan University, which has over 16,000 enrolled students and a campus that extends along eight city blocks on 104th Avenue. The shopping centre’s tenants include Bank of Montreal, Liquor Depot, Red Robin Gourmet Burgers, Subway and Forzani’s Tech Stop. The purchase price of $16.9 million, including closing costs, was satisfied by a combination of cash and the assumption of $4.1 million of existing fixed rate debt with an annual interest rate of 5.74% and maturing in March 2013.
Since the Company’s August 11, 2011 update on acquisition activity, First Capital Realty has acquired additional space adjacent to one existing shopping centre adding 7,000 square feet on 0.2 acres of land.
During the same period, through its Main and Main Developments joint venture, First Capital Realty has acquired development land parcels comprising 0.7 acres in Toronto, Ontario for future development. Total expenditures on these additional interests amount to approximately $9.8 million.
Also since August 11, 2011, Main and Main Developments has entered into binding agreements to acquire development land parcels comprising 0.9 acres for future development at a total cost of approximately $10 million. These binding agreements remain subject to customary closing conditions.
First Capital Realty completed the sale of its West Lethbridge Towne Centre and the substantially complete adjacent development property, comprising a 103,000 square foot shopping centre and a total of 15 acres in Lethbridge, Alberta. The sale price of the property was $42.6 million.
“We are pleased with the acquisition of three properties located in the urban core of Toronto, Calgary and Edmonton, respectively,” said Dori J. Segal, President and CEO. “We see tremendous repositioning and rent growth opportunities in Hazelton Lanes shopping centre and all three properties are exactly in line with our acquisition strategy. Moreover, the disposition of our successful West Lethbridge Towne Centre greenfield development completes our exit from Lethbridge, Alberta, and we look forward to redeploying the capital to higher and better uses more aligned with our core strategies.”
Zellers Stores Outcome
In addition, First Capital Realty announced today leasing transactions with respect to 17 of its 19 existing Zellers leases. A total of 14 leases were assigned to Walmart Canada, which will bring to 18 the aggregate number of Walmart stores in First Capital Realty’s shopping centres and will make Walmart one of the Company’s top five tenants. Based on First Capital Realty’s current portfolio, these 18 Walmart stores would comprise a total of 1.8 million square feet, or 7.7% of the Company’s total gross leasable area. The Zellers stores at the following First Capital Realty shopping centres will become Walmart stores once renovations and redevelopment are completed:
Stanley Park Mall – Kitchener, Ontario
Gloucester Centre – Ottawa, Ontario
Parkway Centre – Peterborough, Ontario
Fairview Mall – St. Catharines, Ontario
Tillsonburg Town Centre – Tillsonburg, Ontario
Cedarbrae Mall – Toronto, Ontario
Sheridan Mall – Toronto, Ontario
Bridgeport Plaza – Waterloo, Ontario
Centre Commercial Domaine – Montreal, Quebec
Deer Valley Market Place – Calgary, Alberta
Meadowlark Shopping Centre – Edmonton, Alberta
Northgate Shopping Centre – Edmonton, Alberta
Southpark Centre – Edmonton, Alberta
Westmount Shopping Centre – Edmonton, Alberta
Two more Zellers leases in First Capital Realty’s portfolio, located at Queenston Mall in Hamilton, Ontario and the recently acquired Place Portobello shopping centre in the Greater Montreal Area, have been assigned to Target Canada.
Lastly, in addition to the 16 future Walmart and Target locations in First Capital Realty’s portfolio, the Company has secured national tenants for a significant portion of the Zellers premises at Ambassador Plaza in Windsor, Ontario.
“We are pleased with the outcome of our discussions with Walmart, Target and other retailers regarding the Zellers premises in our portfolio”, said Dori J. Segal, President and CEO. “We are happy to significantly expand our relationship with Walmart and to welcome Target as a new anchor tenant in our shopping centres.”
ABOUT FIRST CAPITAL REALTY (TSX:FCR)
First Capital Realty is Canada’s leading owner, developer and operator of supermarket and drugstore anchored neighbourhood and community shopping centres, located predominantly in growing metropolitan areas. The Company currently owns interests in 165 properties, including four under development, totalling approximately 22.8 million square feet of gross leasable area and six sites in the planning stage for future retail development.
This press release contains forward-looking statements and information within the meaning of applicable securities law. Forward-looking statements can be identified by the expressions “expects”, “believes”, “estimates”, “will”, “anticipates” and similar expressions. The forward-looking statements are not historical facts but reflect the Company’s current expectations regarding future results or events and are based on information currently available to Management. Certain material factors and assumptions were applied in providing these forward-looking statements.
Management believes that the expectations reflected in forward-looking statements are based upon reasonable assumptions; however, Management can give no assurance that the actual results or developments will be consistent with these forward-looking statements. 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, including the matters discussed under “Risks and Uncertainties” in First Capital Realty’s Management’s Discussion and Analysis and under “Risk Factors” in its current Annual Information Form. Readers, therefore, should not place undue reliance on any such forward- looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. First Capital Realty undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances except as required by applicable securities law.
All forward-looking statements in this press release are made as of the date hereof and are qualified by these cautionary statements.
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For further information:
Dori J. Segal, President & C.E.O., or
Karen H. Weaver, Executive Vice President & C.F.O.
First Capital Realty Inc.
85 Hanna Avenue, Suite 400
Toronto, Ontario, Canada M6K 3S3
Tel: (416) 504-4114
Fax: (416) 941-1655