Alaris Equity Partners Invests a Combined US$47.5 Million in a New Partner and a Follow-On Investment with an Existing Partner

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CALGARY, Alberta, May 14, 2024 (GLOBE NEWSWIRE) -- Alaris Equity Partners Income Trust (the “Trust”) (TSX: AD.UN) is pleased to announce that its subsidiary, Alaris Equity Partners USA Inc. (collectively, with the Trust and its other subsidiaries, “Alaris”) has made an investment into Cresa LLC (“Cresa”) (the “Cresa Investment”). The Trust is also pleased to announce a total of US$27.5 million of funding to The Shipyard, LLC (“The Shipyard” or “TSY”).

Cresa Investment

Cresa is in an active growth phase and sought an equity partner to help it achieve its goals. Alaris was selected as an ideal equity partner given its focus on collaboration and ability to support a growth plan. Alaris and Cresa have a shared vision and values, and the investment is a strong endorsement of Cresa’s occupier focus model on the commercial real estate industry.

"Alaris is excited to be partnering with Cresa. Cresa has an excellent reputation in the industry and a strong growth profile which makes it a perfect fit for Alaris. We look forward to growing with Cresa over the course of our partnership", said Steve King, Chief Executive Officer, Alaris.

"Alaris has a distinguished track record of partnerships and we are delighted to welcome them as a minority investor in Cresa. Their partnership is a testament to the strength of our business model. This investment will accelerate Cresa’s robust growth plans", said Tod Lickerman, Chief Executive Officer, Cresa.

In exchange for an initial US$20.0 million investment, Alaris will receive preferred equity with an initial annual distribution of US$2.8 million resetting annually, up to a maximum of ⁺/- 7%, based on changes in Cresa's revenue. Cresa may pay-in-kind up to a specified percentage of the total annual pre-tax yield ("PIK Distribution"), which Cresa must fully pay on the earlier of the 5^th anniversary of the initial investment or redemption of Alaris' preferred equity.

Alaris' management believes that Cresa will have an earnings coverage ration above 2.0x based on: (a) Cresa's pro forma financial results for the most recent trailing twelve-month period, (b) certain other changes to Cresa's capital structure, and (c) the preferred equity distributions payable to Alaris.

To further accelerate Cresa’s growth plans, the Cresa Investment includes a commitment to fund two follow-on investments of US$10.0 million and US$15.0 million, for which Alaris will receive additional preferred equity. Each tranche of the Cresa Investment will have the same metrics as the initial tranche.