Allied to Acquire Ownership Interest in 400 West Georgia and Increase Ownership Interest in 19 Duncan - Seite 2

Allied expects to complete the transactions in relation to 400 West Georgia and 19 Duncan in early April, subject only to Competition Act approval and customary closing conditions. The transactions will reduce Westbank’s debt to Allied materially and afford Allied a large ownership position in two triple-A urban properties as they near successful completion and full lease-up. The transactions will put modest and temporary upward pressure on Allied’s total indebtedness ratio and net debt as a multiple of Annualized Adjusted EBITDA. Management expects the upward pressure to abate and the ongoing strengthening of Allied’s debt metrics to continue in late 2024 and beyond as a result of (i) contemplated property sales in 2024 and (ii) EBITDA growth on achievement of full lease-up of the properties, particularly the rental-residential component of 19 Duncan. The transactions will also put modest and temporary downward pressure on Allied’s cashflow per unit. Management expects the downward pressure to abate in 2025 and beyond as the properties reach full lease-up.

Allied completed the sale of its UDC portfolio in 2023. In addition to the considerable benefits outlined at the time, the transaction prompted real estate market participants to make unsolicited offers to purchase specific properties from Allied, particularly in Montréal and Toronto. Over the course of 2024 and into 2025, Allied will work toward selling less-strategic properties in its portfolio at IFRS value for aggregate proceeds of up to $200 million. The proceeds will be used (i) to fund the modest incremental allocation of capital associated with the increase in ownership of 19 Duncan and (ii) to continue the ongoing strengthening of Allied’s debt-metrics. For Allied, a less-strategic property is generally one that is smaller in size and not an integral part of a major concentration or assembly of distinctive urban workspace in its portfolio. There appears to be considerable demand for such property in Montréal and Toronto, and Allied expects to pursue most sales privately rather than through a public-offering process.

Allied expects to complete the previously announced reorganization of ownership of TELUS Sky before the end of the second quarter. “The three transactions (TELUS Sky, 400 West Georgia and 19 Duncan), along with our contemplated property sales in Montréal and Toronto, will continue the ongoing upgrade of our urban workspace portfolio and establish our urban rental-residential portfolio in a concrete, material and timely way,” said Michael Emory, Founder & Executive Chair. ”Within a short period of time, these transactions will continue the ongoing strengthening of our debt-metrics and propel growth in our cashflow per unit.”