Allied Joins Jesta Group in Completing Iconic Place Gare Viger Project in Montréal
19 Juli 2021 - 1:45PM
Allied Properties Real Estate Investment Trust (“Allied”)
(TSX:AP.UN) announced today that it will acquire the urban office
component of Jesta Group’s Place Gare Viger in Montréal. Place Gare
Viger is an exceptional mixed-use development located at the
intersection of Old Montréal, Viger Square and the recently
completed Centre Hospitalier de l'Université de Montréal (CHUM).
Over the last decade, Jesta Group has transformed Gare Viger, one
of the finest heritage properties in Canada, into a distinctive
urban office, residential and hotel complex. Allied has entered
into an agreement with Jesta Group to acquire the urban office
component of the complex. Jesta Group will retain the urban
residential and hotel components of the complex.
Allied and Jesta Group were brought together by
CBRE Limitée. “We’re sincerely grateful to Jesta and CBRE for
making this collaboration possible,” said Michael Emory, Allied’s
President & CEO. “It will enhance Allied’s ability to provide
distinctive urban workspace to knowledge-based organizations in
Montréal and other Canadian cities, which is our mission in life. I
also believe it will contribute to making Place Gare Viger one of
the finest mixed-use urban neighbourhoods in our country.”
Acquisition of Gare Viger (Also Known as
The Chateau)
Located at 700 Rue Saint-Antoine East and 755
Rue Berri, Gare Viger is a landmark property that includes one of
the finest heritage buildings in Canada. Completed in 1898 by
Canadian Pacific Railway, Gare Viger was built in the format of a
traditional British railway hotel where the rail lines run directly
into the lobby area. The structure is now comprised of 122,643
square feet of office and retail GLA adjacent to 21 surface parking
spaces. The Chateau is 95.7% leased to users consistent in
character and quality with Allied’s user base. The Chateau will
continue to evolve as a premiere Class I property under Allied’s
management, along with 425 Viger, Nordelec, 5505 St-Laurent,
5445-5455 de Gaspé and others in Montréal and across Canada.
Acquisition of Adjacent Developable
Land
Located at 810 Rue Saint-Antoine East, across
Rue Saint-Hubert and immediately to the east of Gare Viger, this
property is currently owned by Jesta Group and includes 75,672
square feet of land with a small office structure (43,500 square
feet of GLA) and surface parking for up to 132 vehicles. In the
near-term, Allied will use the office structure as swing-space and
continue to operate the parking facility. Allied’s plan for the
property in the longer term is to develop a new building suitable
for use by biotech and life-science users.
Closing and Funding of Gare Viger and
Adjacent Developable Land
The acquisition of Gare Viger and adjacent
developable land is expected to close in late August 2021, subject
to customary conditions. The aggregate purchase price for the two
properties is $128.2 million. On closing, Allied will assume an
existing first mortgage on Gare Viger in the principal amount of
$51.75 million, bearing interest at 2.8%, having a remaining term
of just over three years and payable in blended instalments of
principal and interest based on a 25-year amortization. Allied
expects to fund the remaining $76.45 million initially with
Allied’s operating line of credit and on a permanent basis with the
proceeds from the sale of a small, non-core property in each of
Montréal and Toronto.
Forward Purchase of Urban Office
Building Under Construction
Jesta Group is completing the development of a
new office building at 700 Rue Saint-Hubert, just behind Gare
Viger. The building is scheduled for completion in the second half
of 2022. It will be comprised of approximately 145,743 square feet
of GLA and 145 underground parking spaces and is approximately 24%
pre-leased to Novartis Pharmaceuticals Canada. The purchase price
for the property will be $121.4 million. The forward purchase is
expected to close in the second half of 2022, subject to various
conditions of closing.
About Allied
Allied is a leading owner, manager and developer
of (i) distinctive urban workspace in Canada’s major cities and
(ii) network-dense urban data centres in Toronto that form Canada’s
hub for global connectivity. Allied’s business is providing
knowledge-based organizations with distinctive urban environments
for creativity and connectivity.
About Jesta Group
Jesta Group is an active investor and developer
of iconic real estate assets world-wide with major developments and
investments in hotel, residential, retail and industrial properties
in some of the world’s most sought-after locations, including
London, Paris, Berlin, Montréal, Miami, Houston, Cannes and
Juan-Les Pins. For more information, please consult
www.jesta.com
Cautionary Statements
This press release may contain forward-looking
statements with respect to (i) Allied, (ii) its operations,
strategy, financial performance and condition and (iii) the
expected impact of the transactions contemplated in this press
release. These statements generally can be identified by use of
forward looking words such as “may”, “will”, “expect”, “estimate”,
“anticipate”, “intends”, “believe” or “continue” or the negative
thereof or similar variations. The actual results and performance
of Allied discussed herein could differ materially from those
expressed or implied by such statements. Such statements are
qualified in their entirety by the inherent risks and uncertainties
surrounding future expectations, including that the transactions
contemplated herein are completed and have the expected impact on
funding and earnings. Important factors that could cause actual
results to differ materially from expectations include, among other
things, general economic and market conditions, competition,
changes in government regulations and the factors described under
“Risk Factors” in Allied’s Annual Information Form, which is
available at www.sedar.com. These cautionary statements qualify all
forward-looking statements attributable to Allied and persons
acting on Allied’s behalf. Unless otherwise stated, all
forward-looking statements speak only as of the date of this press
release and the parties have no obligation to update such
statements.
For more information, please
contact:
Michael Emory, President & CEO (416)
977-0643 memory@alliedreit.com
Cecilia Williams, Executive Vice President &
CFO(416) 977-9002cwilliams@alliedreit.com
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