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TORONTO, May 28, 2019 /CNW/ - Choice Properties Real Estate Investment Trust ("Choice Properties" or the "Trust") (TSX: CHP.UN) announced today that it has agreed to issue, on a private placement basis in certain provinces of Canada (the "Offering"), $750 million aggregate principal amount of series M senior unsecured debentures of the Trust that will bear interest at a rate of 3.532% per annum and will mature on June 11, 2029 (the "Debentures").
Offering of Debentures
The Debentures are being offered on an agency basis by a syndicate of agents co-led by RBC Capital Markets, BMO Capital Markets, TD Securities, CIBC Capital Markets and Scotiabank. Subject to customary closing conditions, the Offering is expected to close on June 11, 2019.
The net proceeds of the Offering will be used by the Trust to repay existing indebtedness, including the redemption in full of the $100 million aggregate principal amount of its 2.564% series C senior unsecured debentures due November 30, 2019 (the "Series C Debentures") and the $200 million aggregate principal amount of Choice Properties Limited Partnership's (the "Partnership") 3.00% series 7 senior unsecured debentures due September 20, 2019 (the "Series 7 Debentures"), some of the Trust's unsecured term loans and for general business purposes.
It is a condition of closing of the Offering that the Debentures be rated at least "BBB" with a "stable" trend by DBRS Limited and at least "BBB" by Standard and Poor's Ratings Services. The Debentures will rank equally with all other unsecured indebtedness of the Trust that has not been subordinated.
The Debentures being offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Debentures in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Redemption of Series C Debentures
The Trust announced today that it has provided holders of the Series C Debentures a notice of redemption pursuant to which the Trust will redeem the entire outstanding principal amount of Series C Debentures on June 27, 2019 and has fixed June 26, 2019 as the record date for this redemption. As of the date hereof, there is $100 million aggregate principal amount of Series C Debentures outstanding.
On the redemption date, the Series C Debentures will be redeemed in accordance with their terms at a redemption price per $1,000 principal amount of the Series C Debentures equal to $1,001.470 plus accrued and unpaid interest to but excluding the redemption date of $1.967, and will thereafter cease to be outstanding.
Redemption of Series 7 Debentures
The Trust announced today that the Partnership has provided holders of the Series 7 Debentures a notice of redemption pursuant to which the Partnership will redeem the entire outstanding principal amount of Series 7 Debentures on June 27, 2019 and has fixed June 26, 2019 as the record date for this redemption. As of the date hereof, there is $200 million aggregate principal amount of Series 7 Debentures outstanding.
On the redemption date, the Series 7 Debentures will be redeemed in accordance with their terms at a redemption price per $1,000 principal amount of the Series 7 Debentures equal to $1,000 plus accrued and unpaid interest to but excluding the redemption date of $8.137, and will thereafter cease to be outstanding.
About Choice Properties Real Estate Investment Trust
Choice Properties, Canada's preeminent diversified real estate investment trust, is the owner, manager and developer of a high-quality portfolio comprising 756 properties totaling 67.7 million square feet of gross leasable area. Choice Properties owns a portfolio comprised of retail properties predominantly leased to necessity-based tenants; industrial, office and residential assets concentrated in attractive markets; and an unmatched development pipeline. Choice Properties' strategic alliance with its principal tenant, Loblaw Companies Limited, the country's leading retailer, is a key competitive advantage providing long-term growth opportunities. For more information, visit Choice Properties' website at www.choicereit.ca and Choice Properties' issuer profile at www.sedar.com.
This press release may contain forward-looking information within the meaning of applicable securities legislation, which reflects Choice Properties' current expectations regarding future events. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Choice Properties' control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, the factors discussed in Choice Properties' current Annual Information Form and First Quarter 2019 Report to Unitholders. Choice Properties does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law. All forward-looking statements contained in this press release are made as of the date hereof and are qualified by these cautionary statements.
SOURCE Choice Properties Real Estate Investment Trust