TORONTO, Sept. 18, 2020 (GLOBE NEWSWIRE) — European Residential Real Estate Investment Trust (TSX:ERE.UN, “ERES” or the “REIT”) announced today that it has entered into an agreement to acquire a multi-residential portfolio of five properties located in the Netherlands (the “Kairos Portfolio”). The Kairos Portfolio is comprised of 113 residential suites and 98 parking units across the five properties, which each are 100% owned and currently 99.1% occupied. Approximately 87% of the residential suites are liberalized with a net average monthly rent of €912 per suite.
The €26.25 million (C$41.0 million) purchase price (excluding transaction costs and fees), representing an estimated forward capitalization rate of approximately 3.9%, will be financed initially using immediately available liquidity and ultimately with long-term mortgage financing. Closing is anticipated on or around October 1, 2020, after which the Kairos Portfolio will be managed by ERES’s existing regional asset and property manager established in the Netherlands.
The Kairos Portfolio, located in the municipalities of Hoogezand, Emmen, Hardenberg, Enschede and Maastricht, was constructed between 1997 and 2005, and given the age and quality of the properties ERES anticipates relatively modest capital expenditure needs. The properties reside in green and child-friendly neighbourhoods nearby primary schools, recreational areas and shopping centres, with direct connections to the city centres either by bicycle or by bus accessible within walking distance.
In addition, ERES completed the previously-announced purchase of a multi-residential property located in the municipality of Renkum in the eastern Netherlands (the “Doorwerth Property”) on September 1, 2020. The €20.15 million (C$31.9 million) purchase price (excluding transaction costs and fees) represents an estimated forward capitalization rate of approximately 4.3%. ERES financed the acquisition using cash on hand, with ultimate funding to come from long-term mortgage financing.
“We maintain our confidence in the attractiveness of the Dutch multi-residential real estate market, including its defensive characteristics. Amidst the continued disruptiveness characterizing today’s economic reality, the acquisition of the Kairos Portfolio and Doorwerth Property evidences our ability to accretively add attractive assets to our growing portfolio”, commented Phillip Burns, CEO of ERES. “We will continue prudently to work toward strategically increasing our growth by acquisition on the backbone of this trend, which we expect to continue”.
ERES is an unincorporated, open-ended real estate investment trust. ERES’s Units are listed on the TSX under the symbol ERE.UN. ERES is Canada’s only European-focused, multi-residential REIT, with a current initial focus on investing in high-quality, multi-residential real estate properties in the Netherlands. ERES owns a portfolio of 132 multi-residential properties, comprised of 5,750 suites and ancillary retail space located in the Netherlands, and owns one office property in Germany and one office property in Belgium.
ERES’s registered and principal business office is located at 11 Church Street, Suite 401, Toronto, Ontario M5E 1W1.
For more information, please visit our website at www.eresreit.com.
Cautionary Statements Regarding Forward-Looking Statements
All statements in this press release that do not relate to historical facts constitute forward-looking statements. These statements represent ERES’s intentions, plans, expectations and beliefs and are subject to certain risks and uncertainties that could result in actual results differing materially from these forward-looking statements. These risks and uncertainties are more fully described in regulatory filings that can be obtained on SEDAR at www.sedar.com.
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Mr. Phillip Burns
Chief Executive Officer
Mr. Scott Cryer
Chief Financial Officer