Morguard North American Residential REIT prices $75 million initial public offering

/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES./

MISSISSAUGA, ON, April 9, 2012 /PRNewswire/ - Morguard Corporation (TSX: MRC) and Morguard North American Residential Real Estate Investment Trust (the "REIT") announced today that the REIT has filed, and obtained a receipt for, a final prospectus for its initial public offering of 7,500,000 trust units with the securities commissions of all provinces and territories in Canada. The trust units will be issued at a price of $10.00 per unit and are expected to provide holders of trust units with an annual yield of approximately 6.0%. Gross proceeds of the offering are expected to be approximately $75 million.

The REIT has granted to the underwriters of the offering an option to purchase up to approximately an additional 750,000 trust units at a price of $10.00 per unit for a period of 30 days after closing of the offering and, if exercised in full, will increase the total gross proceeds of the offering to approximately $82.5 million.

The offering is being underwritten by a syndicate of underwriters co-led by RBC Capital Markets and TD Securities, and including CIBC, BMO Capital Markets, Scotiabank, HSBC Securities (Canada) Inc., National Bank Financial Inc., Canaccord Genuity Corp. and Dundee Securities Ltd.

The Toronto Stock Exchange (the "TSX") has conditionally approved the listing of the trust units under the symbol "MRG.UN", subject to fulfilling all of the requirements of the TSX.

The offering is expected to close on April 18, 2012. On closing of the initial public offering, it is expected that Morguard Corporation (collectively, with its affiliates, "Morguard") will directly or indirectly hold a 69.7% interest in the REIT (67.6% if the over-allotment option is exercised in full). Morguard's experienced multi-unit residential real estate team will externally administer and operate the REIT's properties.

On closing of the offering, the REIT will use the net proceeds of the offering to indirectly acquire interests in a portfolio of 14 Canadian multi-unit residential properties and three U.S. multi-unit residential properties currently operated and owned or co-owned by Morguard (the "Initial Properties"). Morguard's interests in the following Initial Properties will be acquired by the REIT:

Toronto, Ontario

  • 35 Thorncliffe Park Drive
  • 43 Thorncliffe Park Drive
  • 47 Thorncliffe Park Drive
  • 49 Thorncliffe Park Drive
  • 45 Generation Boulevard

Mississauga, Ontario

  • 1423 Mississauga Valley Boulevard
  • 1477 Mississauga Valley Boulevard
  • 1547 Mississauga Valley Boulevard
  • 935 Dundas Street East
  • 2869 Battleford Road
  • 3665 Arista Way
  • 30 Elm Drive East

Kitchener, Ontario

  • 305-315 Margaret Avenue

Edmonton, Alberta

  • 10404 104 Avenue

Louisiana, U.S.

  • 1001 East Dale Street, New Iberia
  • 715 Marie Antoinette Street, Lafayette
  • 3215 Knight Street, Shreveport

The REIT initially intends to make monthly cash distributions of $0.05 per trust unit to holders of trust units. The first distribution of the REIT will be for the period from closing to May 31, 2012 and will be paid on or about June 15, 2012, in the amount of $0.07167 per trust unit assuming closing occurs on April 18, 2012. Declared distributions will be paid on or about the 15th day of each month to unitholders of record at the close of business on the last business day of the immediately preceding month. Copies of the final prospectus will be available on SEDAR at www.sedar.com.

The trust units have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered, sold or delivered, directly or indirectly, in the United States or to, or for the account or benefit of, ''U.S. persons'' (as defined in Regulation S under the United States Securities Act of 1933, as amended). This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the trust units in the United States or to, or for the account or benefit of, U.S. Persons.

About Morguard North American Residential REIT

The REIT is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. The REIT has been formed to own multi-unit residential properties in Canada and the United States. Concurrently with the completion of the initial public offering of trust units, the REIT will indirectly acquire, through a limited partnership, the Initial Properties currently operated and owned or co-owned by affiliates of Morguard. The Initial Properties consist of interests in 5,439 residential suites that are located in Ontario, Alberta and Louisiana and have been assembled from Morguard's portfolio of residential properties.

About Morguard

Morguard is a real estate investment company whose principal activities include the acquisition, development and ownership of commercial and multi-unit residential real estate properties. Morguard currently owns interests in a diversified portfolio of 101 office, industrial, retail and multi-unit residential properties (including the Initial Properties) located across Canada and the United States. As of December 31, 2011, Morguard's owned and managed portfolio of retail, office and industrial properties consisted of approximately 54.3 million square feet of gross leasable area and had an estimated market value in excess of $11.4 billion. Morguard owns approximately 44.8% of the units of Morguard Real Estate Investment Trust. Morguard provides advisory and management services to institutional and other investors through Morguard Investments Limited and Morguard Residential.

Forward-Looking Statements

This press release may contain forward-looking information within the meaning of applicable securities legislation, which reflects Morguard's and the REIT's current expectations regarding future events. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Morguard's or the REIT's control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, failure to complete the initial public offering of trust units and related transactions, and the factors discussed under "Risk Factors" in the final prospectus of the REIT dated April 5, 2012. Neither Morguard nor the REIT undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

For more information, visit Morguard's website at www.morguard.com and the REIT's and Morguard's respective issuer profiles at www.sedar.com.

SOURCE Morguard Corporation



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