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NorthWest International Healthcare Properties REIT Announces Closing of Previously Announced Acquisition and Disposition Transactions and a 150% Increase in Distributions

TORONTO, Nov. 16, 2012 /CNW/ - NorthWest International Healthcare Properties REIT (TSXV: MOB.UN) (the "REIT") announced today that it has closed the previously announced sale of its existing Canadian medical office building portfolio to NorthWest Healthcare Properties REIT (TSX: NWH.UN) ("NWHP REIT") in two separate transactions (the "Disposition Transaction"). Concurrently, the REIT completed its previously announced acquisition of a $170 million portfolio of international healthcare real estate in Australia/New Zealand, Brazil and Germany (the "International Portfolio") from NorthWest Value Partners Inc. ("NorthWest") (the "Acquisition Transaction").

Based on the accretive nature of the transactions, the REIT announced that it will increase its annual distributions from $0.064 per unit to $0.16 per unit, which is expected to represent an approximate 95% AFFO payout ratio.

In connection with the transaction closings and distribution increase, Paul Dalla Lana, CEO of the REIT and President of NorthWest commented:

 
      "Today's closing of both the Acquisition and Disposition Transactions and the resulting distribution increase completes the REIT's reconfiguration to a focused international healthcare real estate platform. With its high quality initial portfolio of international assets, a best-in-class management team and a significant acquisition pipeline, the REIT is now well positioned to provide its unitholders with growing stable distributions."
       

The Disposition Transaction

As part of the Disposition Transaction, the REIT sold its existing Canadian medical office building portfolio to NWHP REIT in two separate transactions, effective October 1, 2012. The Disposition Transaction was approved, by way of written consent, by the REIT's disinterested unitholders on September 25, 2012 and collectively resulted in net consideration to the REIT, after the assumption of related debt and subject to usual adjustments, of $39.2 million comprising of $9.2 million of cash and a $30.0 million promissory note.

The Acquisition Transaction

As part of the Acquisition Transaction, the REIT acquired a $170 million portfolio of international healthcare real estate in Australia/New Zealand, Brazil and Germany from NorthWest, entered into a series of external management arrangements with affiliates of NorthWest, and entered into a put / call agreement with respect to NorthWest's interest in NWHP REIT. The Acquisition Transaction was described in the REIT's October 5, 2012 management information circular and was approved by the majority of minority unitholders of the REIT at its October 30, 2012 annual and special meeting.  The Acquisition Transaction is effective October 1, 2012 and was funded through (a) the issuance of 9,878,165 REIT units at a deemed price of $1.87 per unit (approximately $18.5 million), (b) the issuance of 55,944,444 Class B LP Units of NWI Healthcare Properties LP, a subsidiary of the REIT, at a deemed price of $1.87 per unit (approximately $104.5 million) and (c) the assumption of existing debt of approximately $47 million. The purchase price for the Acquisition Transaction is subject to usual adjustments.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

FORWARD-LOOKING INFORMATION

Certain statements contained in this news release may contain projections and "forward-looking statements" within the meaning of that phrase under Canadian securities laws. When used in this new release, the words "may", "would", "should", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions may be used to identify forward-looking statements. Those statements reflect the REIT's current views with respect to future events or conditions, including matters relating to expected AFFO, future distributions, the accretive nature of the Acquisition and the REIT's growth prospects. By their nature, forward-looking statements reflect management's current views, beliefs and assumptions and are subject to certain risks and uncertainties, known and unknown, including, without limitation, risks disclosed in the information circular of the REIT mailed in connection with the annual and special meeting of unitholders held October 30, 2012. Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by these forward-looking statements. Although the forward-looking information contained in this news release is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. Certain statements included in this news release may be considered "financial outlook" for purposes of applicable securities laws, and such financial outlook may not be appropriate for purposes other than this news release. The REIT does not intend to nor assume any obligation to update these forward-looking statements whether as a result of new information, plans, events or otherwise, unless required by law.

SOURCE NorthWest Healthcare Properties Real Estate Investment Trust

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