Invesque Inc. Closes on Previously Announced Acquisition of Toronto Based Mohawk Medical Properties REIT
TORONTO, ONTARIO, MAY 1, 2018 – Invesque Inc. (TSX: IVQ.U) (the “Company”) announced the closing of the previously announced acquisition of Mohawk Medical Properties Real Estate Investment Trust, and its subsidiary, Mohawk Medical Operating Partnership (I) LP (collectively, “Mohawk REIT”) for approximately US$138 million.
As one of the largest portfolios in Canada, Mohawk REIT is comprised of 545,000 square feet spread across 14 medical office buildings (the “Properties” or the “Portfolio”) in Canada and the United States. Affiliates of Mohawk will continue to provide asset and property management services for the Properties.
“We have been eying the medical office space for a while to complement our portfolio,” stated Adlai Chester, the Company’s Chief Investment Officer. “We found the right portfolio with great leadership to establish a strong platform to grow from.”
– Strategic Diversification: The acquisition further pushes the Company’s footprint further into Canada while providing one additional property in New York and two properties in Florida. The addition of medical office space as a new asset to the portfolio continues to help develop a well-diversified portfolio.
– Strong Operating Metrics: The Properties have a strong tenant base comprised of more than 400 physicians, generating strong initial yields, with historical occupancy greater than 90%.
– Rooted Shareholder Value: The Company issued common shares in the amount of US$9.75 per share to the Mohawk REIT unitholders to fund the equity portion of the Transaction.
The acquisition is expected to be immediately accretive to the Company’s Adjusted Funds from Operations (“AFFO”) per diluted share and will be funded through a combination of new debt, cash on hand, and issuance of the Company’s common shares (“Consideration Shares”) at a fixed issuance price of US$9.75 per share in exchange for Mohawk REIT’s current unitholder equity of approximately US$35 million.
The closing of the transaction expanded the Company’s portfolio to 103 buildings, more than 9,000 beds/suites, and 545,000 rentable square feet of medical office space.
Invesque Inc. is a North American healthcare real estate company with a growing portfolio of high quality properties located in the United States and Canada and operated by best-in-class operators primarily under long-term leases and joint ventures. Invesque’s mission is to create long-term shareholder value while providing an investment opportunity that matters. For more information, visit www.invesque.com.
NON-IFRS FINANCIAL MEASURES:
AFFO is not a measure recognized under IFRS and does not have a standardized meaning prescribed by IFRS. Such a measure is presented in this news release because management of the Company believes that such a measure is relevant in interpreting the purchase price metrics and performance of the acquisition. Such a measure, as computed by the Company, may differ from similar computations as reported by other similar organizations and, accordingly, may not be comparable to the measure reported by such other organizations. Please see the Company’s most recent management’s discussion and analysis, which is available on SEDAR at www.sedar.com, for how the Company reconciles AFFO to the nearest IFRS measure.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION:
This press release contains forward-looking information that reflects the current expectations of management about the future results and opportunities for the Company. Forward-looking statements generally can be identified by words such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plans”, “project”, or “continue” or similar expressions suggesting future outcomes or events. More particularly and without limitation, this press release contains forward looking statements and information concerning the acquisition being accretive to AFFO. Such forward-looking statements reflect the Company’s current beliefs and are based on information currently available to management. Although the Company believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that they will prove to be correct. By its nature, such forward-looking information is subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed, including risks in connection with the integration of the Portfolio and the Portfolio not performing as expected. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof and to not use such forward-looking information for anything other than its intended purpose. The Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
FOR FURTHER INFORMATION PLEASE CONTACT:
Chief Investment Officer