TORONTO, Jan. 18, 2022 /CNW/ - Summit Industrial Income REIT ("Summit" or the "REIT") (TSX: SMU.UN) announced today that it has completed the acquisition of the remaining 50% ownership of two recently constructed properties in the Hanlon Creek Business Park in Guelph, Ontario totaling 441,921 square feet of leasable area from Cooper Construction Limited ("Cooper"). Summit acquired its initial 50% interest in the two properties in September 2019 and with occupancy stabilized at 100% effective January 1, 2022, exercised its right to acquire the remaining 50% interest.
Summit paid approximately $54.9 million for the remaining 50% in the two properties. When combined with Summit's existing ownership interest in the properties, Summit's total investment is approximately $84.6 million, generating a consolidated capitalization rate of approximately 4.7%. Including these two properties, Summit has now developed 828,802 square feet of new Class A space in the Hanlon Creek Business Park, representing a total investment of $144.1 million.
The two acquisition properties are brand new, modern Class A buildings adjacent to properties already owned by Summit in this newly-created industrial park near Highway 401. They have 32-foot clear ceiling heights with ample parking and shipping areas. The weighted average lease term across the two buildings is 7.7 years with average contractual annual rental increases of approximately 2.3%. Both buildings are Leadership in Energy and Environmental Design (LEED) certified.
"In addition to our external acquisition program, we are pleased with the continued activity of our development program both on balance sheet and with our joint-venture partners such as Cooper. These two properties demonstrate the REIT's ability to execute on our development strategy, particularly in the strong GTA market, from both a return perspective and our commitment to ESG by delivering brand new, well-located, LEED certified buildings to the REIT's portfolio," commented Dayna Gibbs, Chief Operating Officer.
Summit Industrial Income REIT is an unincorporated open-end trust focused on growing and managing a portfolio of light industrial properties across Canada. Summit's units are listed on the TSX and trade under the symbol SMU.UN. For more information, please visit our web site at www.summitIIreit.com.
Caution Regarding Forward Looking Information
This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "goal" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this news release contains forward looking statements and information concerning the goal to build Summit's property portfolio. The forward-looking statements and information are based on certain key expectations and assumptions made by Summit, including general economic conditions. Although Summit 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 Summit 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, and given the impact of the COVID-19 pandemic and government measures to contain it, there is inherently more uncertainty associated with the REIT's assumptions as compared to prior periods. These risks and uncertainties include, but are not limited to, tenant risks, current economic environment, environmental matters, general insured and uninsured risks and Summit being unable to obtain any required financing and approvals. 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. Summit 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.
SOURCE Summit Industrial Income REIT
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