Northern Property becomes Northview in $3 billion dealCompany acquires True North and apartment portfolio from Starlight Investments
Karen K. Ho
Northern News Services
Monday, August 31, 2015
Northern Property Real Estate Investment Trust (REIT) is in the process of growing into a $3 billion real estate investment trust later this year, but the company said its NWT portfolio isn't going to fall by the wayside.
Chief financial officer Rob Palmer told News/North that Northern Property plans on continuing to invest in its apartments, hotels and commercial real estate holdings in Yellowknife and Inuvik.
"The commitment and the approach for us is still the same," he said.
Earlier this month, Northern Property announced it would be creating the country's third-largest publicly-traded real estate trust. The company is in the process of acquiring True North Apartment Real Estate Trust, as well as the $535 million, 4,650 suite, multi-family portfolio of Toronto-based Starlight Investments Inc.
The new company would have a portfolio of approximately 25,000 residential suites spanning eight provinces and two territories with a value of approximately $3 billion.
If there are no complications with the announced deal, Palmer said Northern Property will officially become Northview Apartment Real Estate Investment Trust in October and trade on the Toronto Stock Exchange under the symbol NVU.UN.
However, Palmer said even after the planned closure of the deal in October, the company will continue to invest in its NWT properties.
"We are 100 per cent committed to the North and investing in the North," he said. "It'll be an important strategic asset of our business going forward."
In fact, Northern Properties' assets in the NWT and Nunavut were highlighted in a news release as providing strong returns and contributing approximately 20 per cent of the net operating income of the new company.
"The North is a very consistent, steady, profitable business for us that we've been in for a very long time," Palmer said.
In the territory, the company has 1,329 apartment units, 160 executive suite and hotel rooms through its Capital Suites brand, as well as 537,000 square feet of commercial space, making the territory's holdings five per cent of its total multi-family portfolio.
Apartments in Yellowknife represent more than 80 per cent of the company's multi-family holdings in the territory.
In Nunavut, the company has 1,096 apartment units, 117 executive suite and hotel rooms through its Capital Suites brand, as well as 243,000-square-feet of commercial space, making the territory's holdings five-per-cent of its total multi-family portfolio.
Palmer said while the company considers Iqaluit one of its three main hubs in Northern Canada, it has properties in 11 smaller communities in Nunavut, including Arctic Bay, Pond Inlet and Pangnirtung.
For Northern tenants living, staying or working in Northern Property's holdings, Palmer said there should be no concerns about how things will operate going forward.
"The day to day running of the business will remain as it is today."