- ViveRE Communities (TSXV:VCOM) has purchased 20 apartments for C$7.3 million
- The company is funding the purchase through a combination of mortgage, stock options, shareholder loans, and cash
- ViveRE has less than a one per cent vacancy rate across its existing portfolio
- COVID-19 has not affected business, with the company already having collected all April rents
- ViveRE Communities (TSXV:VCOM) is holding steady at $0.20 per share, with a market cap of $13 million
ViveRE Communities (TSXV:VCOM) has acquired 20 new apartments in Oshawa, Ontario for C$7 million.
The real estate investment firm has added the 20 new apartments to its portfolio of properties. This changes its total number of units under ownership to 263 units, with another 223 units under agreement.
ViveRE paid $7.3 million for the 20 apartments, subject to adjustments at closing. The mortgage which ViveRE has taken out will cover $4,780,750. The company’s share offering to the vendors will make up another $500,000.
The vendors have also provided VireRE with an unsecured vendor takeback loan to the tune of $500,000. In consideration, the company will issue 2 million warrants for common shares at VireRE at $0.27 per share.
ViveRE also snatched $900,000 in additional financing from a shareholder loan, and made up $1.3 million from cash on hand.
The impacts of COVID-19 has been minimal on the firm, with all rents for April currently collected in full. Also, only one per cent of the company’s portfolio apartments is currently vacant.
To fund all of these loans, VireRE has announced a private placement of tier 1 and tier 2 share units.
A total of 33 tier 1 units were sold at a price of $25,000 per tier 1 unit. Two tier 2 units were sold at a price of $250,000 per tier 2 unit. The aggregate gross proceeds were $1,325,000.
Each Tier 1 unit provides 52,083 common shares of ViveRE and a $12,500 convertible debenture. This will bear annual interest of 7 per cent for a term of two years.
The debenture is convertible into common shares of ViveRE at a price of $0.27 per share. Each Tier 2 unit comprises 520,833 common shares of the company and a $125,000 convertible debenture.
ViveRE Communities (TSXV:VCOM) is holding steady at $0.20 per share at 12:33pm EST.