Inovalis Real Estate Investment Trust Announces a $45 Million Bought Deal Financing to Fund the Acquisition of the Remaining JV Ownership in Paris Property

NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES

TORONTO, Dec. 04, 2019 (GLOBE NEWSWIRE) -- Inovalis Real Estate Investment Trust (the “REIT” or “Inovalis”) (TSX: INO.UN) is pleased to announce that it has entered into an agreement with a syndicate of underwriters (the “Underwriters”) co-led by Desjardins Capital Markets and BMO Capital Markets to sell on a bought deal basis, 4,225,400 trust units of the REIT (the “Units”) at a price of $10.65 per Unit for gross proceeds of $45,000,510 (the “Offering”). The REIT has also granted the Underwriters an over-allotment option to purchase up to an additional 633,810 Units on the same terms and conditions, exercisable at any time, in whole or in part, up to 30 days after the closing of the Offering. The Offering is expected to close on or about December 23, 2019 and is subject to customary conditions, including regulatory approval and the approval of the Toronto Stock Exchange.

The REIT owns a 25% interest in an office building in Arcueil, France and has a non-binding agreement in principle in place with the REIT’s joint venture co-owner to acquire the remaining 75% interest in the property from such co-owner (the “Potential Acquisition”). The Arcueil property is located in the Vache Noire district of Paris and is fully leased to the Orange Group (mobile division of France Telecom) with the existing lease set to expire in March 2023. The property consists of 9 upper levels and 2 basement levels, with 253 parking spaces (40 outdoor and 213 indoor) with office floor plates of approximately 2,500 sq. m. The transaction is expected to close prior to December 31, 2019.

The REIT intends to use the net proceeds from the Offering to fund the Potential Acquisition and for general trust purposes.

The Units forming part of the Offering will be offered in Canada pursuant to a short form prospectus to be filed with the securities commissions and other similar regulatory authorities in each of the provinces of Canada, pursuant to National Instrument 44-101 - Short Form Prospectus Distributions.

“This acquisition opportunity represents the first step in simplifying the ownership structure of the REITs assets. It is the REIT’s intention over the next 12 to 18 months to reduce the number of joint-venture properties and crystalize some of the embedded value within the portfolio to provide additional value for unitholders” stated David Giraud, CEO of the REIT.