- Granite Real Estate Investment Trust (GRT.UN) is looking to raise C$250 million in a bought deal offering to fund a string of proposed acquisitions
- The trust intends to issue 3.34 million units at a price of $75.00 each, comprised of one trust unit of the REIT and one common share in Granite REIT Inc.
- The total purchase price of the acquisitions is expected to be $564 million and include four assets in the United States and four in the Netherlands
- A further $136 million is expected to go towards existing properties currently under development
- Granite Real Estate Investment Trust is currently down 3.59 per cent to $74.93 per share
Granite Real Estate Investment Trust (GRT.UN) is looking to raise C$250 million to fund a string of proposed acquisitions.
Under the terms of the bought deal offering, the trust intends to issue 3.34 million units at a price of $75.00 each. These units will consist of one trust unit in the REIT and one common share in Granite REIT Inc.
The syndicate of underwriters, led by BMO Capital markets and TD Securities, have also been granted an over-allotment option – exercisable in whole or in part – to purchase an additional 501,000 units. Should the underwriters elect to fully exercise the option, the gross proceeds from the offering will be brought to approximately $288 million.
Granite currently has an acquisition pipeline worth $564 million, including four assets in the United States and four in the Netherlands – all of which the trust hopes to close in the fourth quarter of 2020, subject to the completion of due diligence.
The properties sit within Granite’s core distribution and logistics markets in the U.S. and Europe, representing roughly 5 million square feet of leasable area.
Significantly, the acquisitions are currently 95 per cent occupied with an average lease term of 14.3 years.
In addition to the string of acquisitions, Granite plans to inject a further $136 million into its existing properties in 2021.
Roughly $121 million of this amount will go towards those properties currently under development, including two distribution and warehouse facilities in Houston, Texas, and an industrial property in Altbach, Germany, while the remaining $15 million will be put towards expansion initiatives at two assets in Toronto.
“These acquisition opportunities are highly compelling and consistent with our stated growth strategy – high quality distribution and logistics facilities that will strengthen our presence in our key target markets in the U.S. and Europe,” said Kevan Gorrie, President and CEO of Granite Real Estate Investment Trust.
“We will continue to pursue our robust acquisition pipeline to capitalise on the strong fundamentals of the industrial sector,” he added.
Granite Real Estate Investment Trust is currently down 3.59 per cent to $74.93 per share at 10:20am EST.