Artis REIT is known for being a player in Western Canada: 98.8 per cent of its portfolio comes from provinces west of Ontario.
But its geographical distribution is set to change after buying two new properties in the Greater Toronto Area from Crown Realty Partners. The total purchase price is $116.5-million.
The first property is the three-building Concorde Corporate Centre in northeast Toronto, with tenants including Home Depot Canada and Deloitte & Touche. At an $87-million purchase price, the capitalization rate is 8.25 per cent.
The second is the two-building Cancross Court in Mississauga, just west of Toronto. The $29.5-million purchase price represents a 7.75 per cent capitalization rate.
The acquisitions are expected to close this fall and will be financed with cash and new debt. This debt, comprising about 65 per cent of the total purchase price, is expected to have an interest rate around 4.5 per cent.
Artis specializes in commercial properties and its portfolio breaks down as follows: about 30 per cent retail, 32 per cent office, and 38 per cent industrial.