Canadian Real Estate Investment Trust Moves for Calgary Office Towers
- Nov 01, 2012
Calgary, Canada—The Morguard Real Estate Investment Trust has made an announcement regarding its most recent addition to its office portfolio. The entity has acquired a Calgary Class-A office property after the agreement to purchase the 100 percent freehold interest in the asset was finalized. The property in question is the centrally located Penn West Plaza, offering 621,628 square feet of office space, and the transaction total is a reported $374.3 million.
Located at 207 – 213 9th Avenue S.W., Penn West Plaza is part of Calgary’s Central Business District. Apart from the 600k+ square feet of gross leasable space, the two towers also include 17,766 square feet of prime retail space, while parking at the site is ensured by 379 spaces. Both of the Class-A towers are currently under a long-term leasing contract. The company occupying the entire available space at the property, apart from the retail component, is Penn State Petroleum Ltd., who still has 12 years on the current net lease agreement.
Details regarding the acquisition show that Penn West Plaza is being bought free and clear of financial encumbrances, and that the price paid for the office towers stands at $374.3 million, not including closing costs. Morguard REIT will finance the transaction through a 10-year mortgage worth $210 million at a 3.93 percent yearly interest rate, the proceeds gained through the offering of 4.85 percent convertible unsecured subordinated debentures that were due on October 31st, or around $145.7 million, as well as other resources.
Morguard Real Estate Investment Trust is a publicly traded entity that currently owns a diversified portfolio of more than 8.3 million square feet of commercial real estate across Canada. At the end of Q4 of 2011, Morguard REIT’s assets were valued at more than $2.2 billion. As for parent company Morguard, it currently owns and manages assets from the retail, office, industrial and multifamily sectors totaling around $54.1 million square feet and 12644 residential units. It has a commercial presence in the United States of around 2.7 million square feet.