Firm Capital Apartment REIT Provides Strategic Review Update Including Florida Property Disposition and Early Redemption of Convertible Debenture

All figures in $USD unless otherwise noted.

TORONTO, May 22, 2024 (GLOBE NEWSWIRE) -- Firm Capital Apartment Real Estate Investment Trust (“the “Trust”), (TSXV: FCA.U), (TSXV: FCA.UN) is pleased to report the following:

$30.5 MILLION DISPOSITION OF FLORIDA PROPERTY

The Trust has completed the sale of one of its wholly-owned multi-family assets located in Florida (the “Florida Property”) for $30.5 million. The Florida Property had a sales price in line with its IFRS value.

Net of associated mortgage debt and closing costs, the net sale proceeds were approximately $12.0 million. As part of the transaction, the Trust has agreed to provide seller financing for $4 million due in 12 months (with a possible further one time six month extension) that will provide the Trust a possible escalating return on its investment as follows: (i) for the first six months, the interest rate is 9%, (ii) 11% from months 6 -12 and (iii) 15% from months 12 – 18.

On closing, the Trust received net sale proceeds of approximately $8.0 million which are being used for working capital purposes and debt reduction, which includes the Convertible Debenture (see below).

EARLY REDEMPTION OF $14.0 MILLION FCA.DB CONVERTIBLE DEBENTURE

The Trust is pleased to announce that it intends to redeem early all of its outstanding $13.8 million (CAD$18.8 million) aggregate principal amount of 6.25% convertible unsecured subordinated debentures due June 30, 2026 (the “Convertible Debentures”) on or about July 2, 2024 (the “Redemption Date”). The Convertible Debentures, which have a maturity date of June 30, 2026, will be redeemed by the Trust early in accordance with the terms of the trust indenture. The Convertible Debentures, which are listed and posted for trading on the TSX Venture Exchange under the symbol FCA.DB, will cease trading on the Redemption Date.

On the Redemption Date, the Trust will pay holders of Convertible Debentures a redemption price equal to $1,000 for each $1,000 principal amount of Convertible Debentures and all accrued and unpaid interest up to but excluding the Redemption Date. The Trust intends to use cash on hand to pay the redemption price of the redeemed Convertible Debentures.

Formal notice of redemption is being delivered to the Convertible Debenture holders through the Debenture Trustee, TSX Trust Company, in accordance with the trust indenture. Beneficial holders of the Convertible Debentures are encouraged to contact their investment dealer to coordinate the surrender of their Convertible Debentures or if they have any questions about the redemption. No action is required to be taken by holders of the Convertible Debentures in connection with the redemption.