CAPREIT to Provide Property Acquisition Facilities to Support I-RES REIT's Portfolio Growth

TORONTO, ONTARIO--(Marketwired - Nov. 21, 2014) - Canadian Apartment Properties Real Estate Investment Trust ("CAPREIT") (TSX:CAR.UN) announced today that it has entered into an agreement (the "Pipeline Agreement") with Irish Residential Properties REIT plc ("I-RES") to make available up to EUR150 million for a period of up to one year to acquire high quality properties in Ireland, and to subsequently permit I-RES to acquire such properties from CAPREIT once I-RES has sourced additional funding.

In consideration for making the facility available under the Pipeline Agreement, and subject to I-RES shareholder approval, the initial term of the Investment Management Agreement dated April 11, 2014 between I-RES and I-RES Fund Management Limited, a wholly-owned subsidiary of CAPREIT, will be extended from 5 years to 7.5 years. The Pipeline Agreement will terminate upon the termination of the Investment Management Agreement, however, after deployment of the EUR150 million commitment, no further funds will be made available to, and no amounts may be re-drawn by, I-RES under the Pipeline Facility unless reauthorized by CAPREIT.

Both the Pipeline Agreement and the extension of the Investment Management Agreement remain subject to the approval of I-RES shareholders.

"We are very pleased to be supporting I-RES with their growth plans and to have received recognition of our strong management platform with the I-RES Board approval of the extension of the Investment Management Agreement," stated Thomas Schwartz, President and CEO. "The funds available under this innovative agreement will be used to acquire high quality properties in Ireland that meet both CAPREIT's and I-RES' investment criteria. Importantly, all properties acquired under this agreement will be accretive to CAPREIT from both a property cash flow while CAPREIT owns the assets and an ongoing fee basis once I-RES acquires the properties from CAPREIT and I-RES Fund Management Limited manages the properties for I-RES."

Under the Pipeline Agreement, CAPREIT will bid for and, if successful, acquire properties, approved by CAPREIT's Board of Trustees and I-RES' Independent Directors, through special purpose vehicles ("SPV"). Upon having sufficient financing, I-RES will acquire the SPVs at a price equal to the price paid for the relevant property investments held by that SPV (together with all third party costs incurred by CAPREIT) (the "Acquisition Cost") (net of indebtedness) provided that I-RES acquires the SPV within six months of the acquisition of the property, and thereafter at the greater of the Acquisition Cost and the fair market value of the assets of the SPV. If I-RES does not acquire the SPV within one year of the acquisition of the relevant property, CAPREIT would be permitted, but not obliged, to sell the property for its own benefit.