|By Marketwired .||
|January 9, 2014 01:18 PM EST||
TORONTO, ONTARIO -- (Marketwired) -- 01/09/14 -- CHC Realty Capital Corp. ("CHC" or the "Company") (TSX VENTURE:CHC.P), a capital pool company, is pleased to announce that it has entered into a purchase and sale agreement dated January 9, 2014 to acquire the "Liberty Terrace" student housing property located in Kingston, Ontario (the "Property"). Subject to the terms and conditions of the agreement and the completion of certain conditions precedent, including satisfactory due diligence and receipt of all necessary regulatory approvals, including TSX Venture Exchange ("TSXV") approval, the proposed transaction will qualify as CHC's "Qualifying Transaction" as defined in TSXV Policy 2.4 - Capital Pool Companies.
The Property is situated at 335 Barrie Street, Kingston, in close proximity (approximately 1.2 km) to Queen's University. It is comprised of 18 beds and 1,108 sq ft. of ground floor commercial space. The vendor of the Property is Q4 Realty Inc. (the "Vendor"), a corporation incorporated under the laws of Ontario. The Vendor is not related to CHC or any of its directors and officers. As such, the acquisition will not be a Non-Arm's Length Qualifying Transaction (as that term is defined in TSXV Policy 2.4) and approval of CHC's shareholders will not be required for the completion of the acquisition. The principal shareholders of the Vendor are Bernard Luttmer, Oskar Johansson and John Feaver all of Toronto, Ontario and Andrew Keilty of Kingston, Ontario.
The purchase price for the Property is $2.5 million, subject to adjustments, which CHC intends to satisfy through the assumption of an existing mortgage on the Property in the principal amount of approximately $1.3 million, and the payment to the Vendor of the balance of the purchase price in cash from CHC's existing funds. CHC has paid a refundable deposit to the Vendor in the amount of $25,000. The deposit will become non-refundable upon satisfaction or waiver of CHC's due diligence condition in respect of the acquisition.
"We are very excited to enter into this transaction as the first step in our growth plan to become the leading provider of student housing across Canada", said Mark Hansen, Chief Executive Officer of CHC. "Liberty Terrace meets our criteria for acquiring high quality assets in close proximity to a major university in a proven market. The property provides stable and secure cash flow and is managed by a strong local partner in Varsity Properties, who are the leading property manager of student accommodations in the Kingston market. This model represents our template for growth across the country."
In addition to the deposit paid by the Company, CHC Realty Investments Inc. ("CHC RI"), a company owned by Mark Hansen, President, CEO and a director of the Company and Craig Smith, a director of the Company, has paid the Vendor an additional $75,000 refundable deposit, which will also become non-refundable upon satisfaction or waiver of CHC's due diligence condition in respect of the acquisition. CHC RI will also pay the Vendor an additional non-refundable deposit of $100,000 upon satisfaction or waiver of CHC's due diligence condition. The deposits will be repaid by the Company to CHC RI on closing of the proposed transaction, without interest or fees.
There will be no changes to the directors and officers of CHC as a result of the Qualifying Transaction. The directors and officers of CHC are Mark Hansen, President, CEO and director, Robert Waxman, CFO, Vaughn MacLellan, Corporate Secretary and director, Craig Smith, director and Thomas Murphy, director. Additional information about the directors and officers of CHC is contained in the prospectus of the Company dated November 19, 2013 relating to its initial public offering, which is available under the Company's profile on SEDAR at www.sedar.com.
On closing of the acquisition of the Property, CHC anticipates meeting the "Tier 2" initial listing requirements of the TSXV for a real estate issuer. Closing of the acquisition is currently anticipated to be in the first quarter of 2014.
The acquisition of the Property is intended to form part of a series of transactions which will result in CHC carrying on business as an owner and operator of student housing properties located in Canada with an internalized executive management platform and, at an appropriate time, the effective conversion of CHC into a real estate investment trust focused on student housing.
Additional Information Regarding the Property
The Property's 18 student beds are fully occupied and the commercial space is currently 100% leased to two tenants. Both commercial leases expire later in 2014. One of the commercial tenants has decided not to renew its lease and will be vacating the space at the end of its term. The other tenant is Varsity Properties Inc. ("Varsity"), a related entity to the Vendor. The location leased by Varsity is its head office. Varsity has entered into a new 5 year lease for the entire commercial space upon expiry of the existing leases. The terms of the new lease will increase NOI by $10,000 annually.
The existing mortgage on the Property will be assumed by CHC on closing. The mortgage is with a Canadian chartered bank and CHC is currently in discussions with the bank to assume the mortgage on closing. The principal balance outstanding on the mortgage is approximately $1.3 million. The mortgage comes due on June 1, 2014 with an above market interest rate. CHC intends to enter into discussions post-closing to renew the mortgage at current market rates.
The following table highlights additional information about the Property:
------------------------------------------------------------------------ Year NOI NOI Occupancy AMR Built Beds (LTM) Cap Rate (LTM) (LTM) ------------------------------------------------------------------------ 2009 18 $149,527 6.0% 100% $847.69 ------------------------------------------------------------------------ Notes: NOI = net operating income. See also "Non-IFRS Measure". LTM = last 12 months ended November 30, 2013. AMR = average monthly rate per bed (excluding commercial and parking)
In connection with the acquisition of the Property, CHC expects to enter into property management arrangements with Varsity, pursuant to which Varsity will become the property manager of the Property. Varsity is not related to CHC or any of its directors and officers. Varsity will be entitled to receive a fee for its property management services calculated on the basis of the Property's aggregate gross revenue to be negotiated.
Conditions of Completion
The acquisition of the Property will be subject to receipt of all necessary regulatory approvals, including the approval of the TSXV. In addition, the acquisition of the Property is subject to certain closing conditions, including completion of satisfactory due diligence and the completion of financing arrangements with the mortgage lender.
As of the date hereof, CHC has 55,000,000 common shares issued and outstanding, 4,125,000 incentive options exercisable at $0.10 per share and 1,000,000 agent's options exercisable at $0.10 per share. There will be no change to the capitalization of CHC as a result of the acquisition of the Property, other than the new mortgage financings in respect of the Property to be obtained by CHC.
Sponsorship of a Qualifying Transaction of a capital pool company is required by the TSXV unless an exemption from the sponsorship requirement is available. CHC intends to seek a waiver from the TSXV of the sponsorship requirement but if such waiver is not obtained, CHC will then retain a qualified sponsor.
CHC's common shares are currently halted and CHC anticipates they will remain halted until the documentation required by the TSXV for the proposed transaction can be provided to the TSXV.
About CHC Realty Capital Corp.
CHC is currently designated as a capital pool company by the TSXV. The Company has not commenced commercial operations and has no assets other than cash. Upon completion of its "Qualifying Transaction", CHC intends to carry on business as an owner and operator of student housing properties located in Canada with an internalized executive management platform. At an appropriate time in the future, CHC intends to convert into and carry on such business as a real estate investment trust.
Cautions Regarding Future Plans and Forward Looking Information
Completion of the proposed transaction is subject to a number of conditions, including but not limited to TSXV acceptance and, if applicable pursuant to TSXV requirements, majority of the minority approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the proposed transaction may not be accurate or complete and should not be relied upon. Trading in the securities of CHC should be considered highly speculative.
The TSXV has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
This press release contains forward-looking information within the meaning of Canadian securities laws. Such information includes, without limitation, information regarding the completion of the proposed transaction and the business strategies of CHC. Although CHC believes that such information is reasonable, it can give no assurance that such expectations will prove to be correct. Forward looking information is typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. CHC cautions investors that any forward-looking information provided by CHC is not a guarantee of future results or performance, and that actual results may differ materially from those in forward looking information as a result of various factors, including, but not limited to: CHC's ability to complete the proposed transaction; the state of the real estate sector in the event the proposed transaction is completed; recent market volatility; CHC's ability to secure the necessary mortgage financing or to be fully able to implement its business strategies and other risks and factors that CHC is unaware of at this time. The reader is referred to CHC's initial public offering prospectus and other continuous disclosure documents for a more complete discussion of risk factors relating to CHC and their potential effects, copies of which may be accessed through CHC's profile on SEDAR at www.sedar.com.
This news release shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there by any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
This press release uses the term "NOI", which stands for net operating income. NOI is not a measure recognized under IFRS and does not have a standardized meaning prescribed by IFRS. It is a supplemental measure of performance for issuers. CHC believes that NOI is an important measure of operating performance and is useful in assessing the company's property operating performance on an unlevered basis. The IFRS measurement most directly comparable to NOI is net income and NOI should not be construed as an alternative to net income determined in accordance with IFRS as an indicator of the company's performance.
Who are you? How do you introduce yourself? Do you use a name, or do you greet a friend by the last four digits of his social security number? Assuming you don’t, why are we content to associate our identity with 10 random digits assigned by our phone company? Identity is an issue that affects everyone, but as individuals we don’t spend a lot of time thinking about it. In his session at @ThingsExpo, Ben Klang, Founder & President of Mojo Lingo, discussed the impact of technology on identity. Sho...
Feb. 20, 2017 08:30 AM EST Reads: 5,105
@DevOpsSummit has been named the ‘Top DevOps Influencer' by iTrend. iTrend processes millions of conversations, tweets, interactions, news articles, press releases, blog posts - and extract meaning form them and analyzes mobile and desktop software platforms used to communicate, various metadata (such as geo location), and automation tools. In overall placement, @DevOpsSummit ranked as the number one ‘DevOps Influencer' followed by @CloudExpo at third, and @MicroservicesE at 24th.
Feb. 20, 2017 08:30 AM EST Reads: 939
SYS-CON Events announced today that Enzu will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive ad...
Feb. 20, 2017 08:30 AM EST Reads: 2,190
There are 66 million network cameras capturing terabytes of data. How did factories in Japan improve physical security at the facilities and improve employee productivity? Edge Computing reduces possible kilobytes of data collected per second to only a few kilobytes of data transmitted to the public cloud every day. Data is aggregated and analyzed close to sensors so only intelligent results need to be transmitted to the cloud. Non-essential data is recycled to optimize storage.
Feb. 20, 2017 08:15 AM EST Reads: 1,135
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
Feb. 20, 2017 07:45 AM EST
WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web communications world. The 6th WebRTC Summit continues our tradition of delivering the latest and greatest presentations within the world of WebRTC. Topics include voice calling, video chat, P2P file sharing, and use cases that have already leveraged the power and convenience of WebRTC.
Feb. 20, 2017 07:30 AM EST Reads: 135
Information technology (IT) advances are transforming the way we innovate in business, thereby disrupting the old guard and their predictable status-quo. It’s creating global market turbulence. Industries are converging, and new opportunities and threats are emerging, like never before. So, how are savvy chief information officers (CIOs) leading this transition? Back in 2015, the IBM Institute for Business Value conducted a market study that included the findings from over 1,800 CIO interviews ...
Feb. 20, 2017 07:30 AM EST Reads: 1,384
Stratoscale, the software company developing the next generation data center operating system, exhibited at SYS-CON's 18th International Cloud Expo®, which took place at the Javits Center in New York City, NY, in June 2016.Stratoscale is revolutionizing the data center with a zero-to-cloud-in-minutes solution. With Stratoscale’s hardware-agnostic, Software Defined Data Center (SDDC) solution to store everything, run anything and scale everywhere, IT is empowered to take control of their data ce...
Feb. 20, 2017 07:15 AM EST Reads: 664
In his session at @DevOpsSummit at 19th Cloud Expo, Robert Doyle, lead architect at eCube Systems, will examine the issues and need for an agile infrastructure and show the advantages of capturing developer knowledge in an exportable file for migration into production. He will introduce the use of NXTmonitor, a next-generation DevOps tool that captures application environments, dependencies and start/stop procedures in a portable configuration file with an easy-to-use GUI. In addition to captur...
Feb. 20, 2017 07:15 AM EST Reads: 3,376
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settle...
Feb. 20, 2017 07:15 AM EST Reads: 108
SYS-CON Events announced today that SD Times | BZ Media has been named “Media Sponsor” of SYS-CON's 20th International Cloud Expo, which will take place on June 6–8, 2017, at the Javits Center in New York City, NY. BZ Media LLC is a high-tech media company that produces technical conferences and expositions, and publishes a magazine, newsletters and websites in the software development, SharePoint, mobile development and commercial UAV markets.
Feb. 20, 2017 07:00 AM EST Reads: 1,456
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain.
Feb. 20, 2017 06:45 AM EST Reads: 263
In the first article of this three-part series on hybrid cloud security, we discussed the Shared Responsibility Model and examined how the most common attack strategies persist, are amplified, or are mitigated as assets move from data centers to the cloud. Today, we’ll look at some of the unique security challenges that are introduced by public cloud environments. While cloud computing delivers many operational, cost-saving and security benefits, it takes place in a public, shared and on-demand ...
Feb. 20, 2017 06:30 AM EST Reads: 1,086
Both SaaS vendors and SaaS buyers are going “all-in” to hyperscale IaaS platforms such as AWS, which is disrupting the SaaS value proposition. Why should the enterprise SaaS consumer pay for the SaaS service if their data is resident in adjacent AWS S3 buckets? If both SaaS sellers and buyers are using the same cloud tools, automation and pay-per-transaction model offered by IaaS platforms, then why not host the “shrink-wrapped” software in the customers’ cloud? Further, serverless computing, cl...
Feb. 20, 2017 06:00 AM EST Reads: 1,629
The Software Defined Data Center (SDDC), which enables organizations to seamlessly run in a hybrid cloud model (public + private cloud), is here to stay. IDC estimates that the software-defined networking market will be valued at $3.7 billion by 2016. Security is a key component and benefit of the SDDC, and offers an opportunity to build security 'from the ground up' and weave it into the environment from day one. In his session at 16th Cloud Expo, Reuven Harrison, CTO and Co-Founder of Tufin, ...
Feb. 20, 2017 05:30 AM EST Reads: 4,580