|10.06.2010 16:44:32 - Florida Appraisers Ask to Cut Value of Gulf Property Hit by Oil |
| June 9 (Bloomberg) -- Two of Florida’s elected property appraisers asked state lawmakers to let them cut the value of coastal real estate to reflect damage from BP Plc’s oil spill in the Gulf of Mexico and get BP to make up for lost tax revenue.
Coastal property values have fallen as oil washed up on beaches and as hotel reservations tumbled as much as 50 percent, said Gregory Brown, property appraiser in Santa Rosa County in the state’s western panhandle, in a phone interview. The appraisers, who held a press conference today at the Escambia Emergency Operations Center in Pensacola, said it was too soon to quantify the valuation change.
Brown and Escambia County appraiser Chris Jones met with state lawmakers yesterday. They discussed their request to Governor Charlie Crist to call a special session of the Legislature to authorize governments affected by the spill to revalue property for the current tax year, something that has been done after hurricanes and tornadoes in the past.
The spill is “a slow-moving nightmare” that may cut tax collections for the state and local taxing authorities, Brown said. He and Jones also want lawmakers to force London-based BP to make up lost tax revenue.
The spill will hurt travel to the area, though the effect on revenue and property values still isn’t clear, Sean Snaith, an economist at the University of Central Florida in Orlando, said in a phone interview. A 10 percent decline in tourism may put 39,000 people out of work and reduce income in the 23 Gulf Coast counties by $2.2 billion, he said.
The appraisers are seeking permission to reflect damage to property values from the spill in tax bills property owners will receive in November, Jones said in a phone interview today. Under state law they can’t alter the value assigned to property on Jan. 1 in the middle of the year, he said.
Appraisers are elected in Florida and it’s their job to provide the fairest property values possible to constituents, said Jones. He said he values 165,000 pieces of property, including 30,000 on the coast. Another 50,000 to 60,000 properties are along inland waterways whose values may drop if exposed to the oil, he said.
Escambia County’s property was appraised at $27.6 billion in 2009, according to the municipality’s financial filings. After property values fell about 6 percent last year, the county had to cut spending by $24 million, the documents show.
“What do I tell the owner of a $1 million house is the value if he can no longer walk on the beach?” asked Jones. “We want to hold our own citizens harmless and don’t want to put the burden on other taxpayers. We want BP to foot the bill.”
|10.06.2010 16:43:54 - Boca Raton deal shows market weakness |
|Pebb Enterprises has purchased the 89,503-square-foot Boca Corporate Plaza for $8.55 million from Invesco Real Estate – a bit more than half the price paid for the property in 1998, according to public records.
The likely reason for the bargain price? The Loopnet.com website indicates 14 spaces totaling 60,226 square feet are available – that's 67 percent of the space in the building.
The reflective-glass-covered building was built in 1987. It sits along the east side of Florida's Turnpike at Glades Road, next to a lake with a geysering fountain.
The 22-acre development around the office building includes a Hilton hotel, restaurants and retail shops.
The website for the plaza says the building has newly renovated common areas and four parking spaces per 1,000 square feet. It is described as one of only two Class A buildings in the western Boca Raton area.
Palm Beach County records indicate the building sold for $16.1 million in 1998 and $14 million in 1997.
The assessed value for 2009 was $14.8 million.
The deal shows the tough nature of the commercial market in South Florida, which has been battered by rising vacancy rates, falling leasing rates and foreclosures.
Invesco Real Estate is part of investment giant Invesco Ltd. (NYSE: IVZ), which has $419.6 billion in assets under management, according to its website.
Among its products are the Invesco mutual funds.
CB Richard Ellis Capital Markets, led by Vice Chairman Christian Lee in Miami, helped arrange the sale of the six-story office building.
Pebb Enterprises, owned by the Weiner family, is a real estate investment, development and management company. Its headquarters is at 6400 N. Andrews Ave., in Fort Lauderdale, where the South Florida Business Journal is the signature tenant.
Pebb Enterprises' website says it is seeking existing shopping centers, retail, office, warehouse and flex space priced at $5 million to $50 million.
The company is also seeking land for new development of retail projects under 500,000 square feet, office space under 150,000 square feet, flex space of up to 200,000 square feet and residential up to 100 acres.
Read more: Boca Raton deal shows market weakness - South Florida Business Journal
|10.06.2010 16:43:09 - Foreclosures curbed in Pinellas, Sarasota |
|Foreclosures remained mostly flat nationwide in May, but in Florida — and especially the Tampa Bay area — the peak of this real estate burden may have finally been reached.
Foreclosure filings were down nearly 14 percent in Florida, bolstered by significant year-over-year declines in Pinellas and Sarasota counties, according to a new report from RealtyTrac.
Pinellas experienced a 24 percent drop in foreclosures since May 2009. Sarasota was not far behind with an 11.5 percent decline.
That helped offset minimal gains in three Tampa Bay area counties. Hernando was up 4.4 percent, Hillsborough up by 3.6 percent and Manatee 2.7 percent higher.
Although foreclosures were up by a half-percent nationwide from the previous year, RealtyTrac Chief Executive Officer James J. Saccacio said this could simply be a sign of lenders working through a backlog of distressed properties that have built up over the past couple of years. “Lenders appear to be ramping up the pace of completing these forestalled foreclosures, even while the inflow of delinquencies into the foreclosure process has slowed,” Saccacio said, in a release.
Florida continues to have the nation’s third highest foreclosure rate behind Nevada and Arizona, where one in every 174 homes were in some state of foreclosure. It’s also among the 10 states that account for more than 70 percent of the national total, led by California.
Pasco County had a 4 percent drop in foreclosures over the past year, but it remains in the top 10 counties with the highest foreclosure rates in Florida, two slots ahead of Hernando. Polk County is ranked 16th despite a 2 percent drop from May 2009.
RealtyTrac’s foreclosure market report provides a count of the total number of properties with at least one foreclosure filing entered into the RealtyTrac database during the month. It is collected from more than 2,200 counties nationwide, which accounts for 90 percent of the U.S. population.
Read more: RealtyTrac: Foreclosures curbed in Pinellas, Sarasota - Tampa Bay Business Journal
|12.01.2009 18:34:41 - Economic downturn pounds commercial real estate market (http://www.usatoday.com/money/economy/2009-01-11-commercial-real-estate_N.htm)|
|Tom Howorth is feeling the impact of the crumbling real estate market. The Oxford, Miss., architect's firm has dwindled from 18 people to 11 since mid-2007 as clients have postponed or canceled major projects. The situation appears to be getting worse. Colleagues in other parts of the country, who had been faring better, now tell Howorth they are also starting to see a steep drop in business.
"People have lost confidence," says Howorth, a principal at Howorth & Associates Architects. "Whether it's a church that doesn't know what their membership is going to be able to do (with its building fund) … to universities whose endowments have taken a huge hit, to individuals who are saying, 'Look at what's happened to real estate values,' to developers who aren't even thinking about spending money in this economy."
Contractors, investors and developers are bracing for what could be the worst real estate crunch since the early 1990s, when the industry built a small city's worth of speculative office buildings that later went begging for tenants. Commercial property sales plunged 73% last year, according to Real Capital Analytics. Vacancy rates are rising, and hundreds of large properties are in default. The American Institute of Architects' billing index, a leading indicator of construction six months ahead, is at a record low. Unemployment in the construction industry is 15.3%, well above the average 7.2% jobless rate.
The 1990s crisis was sparked by federal tax breaks that encouraged overinvestment and overbuilding. This time around, the real estate frenzy was fueled by cheap credit, which allowed investors and developers to bid up prices of existing properties. But the economic fallout could be similar: rising bankruptcies and unemployment and slower economic growth at a time when the economy is already reeling from a historic housing depression.
|12.01.2009 18:34:16 - Orlando area in 2009: 'Foreclosures will still rule' (http://www.orlandosentinel.com/business/orl-realhome1209jan12,0,4395510.story)|
|Central Florida real-estate veterans polled a year ago for CFB's 2008 residential forecast accurately predicted what many Realtors did not want to hear at the time: The region's housing market would "continue to snooze and wait in 2008."
For 2009, those experts see glimmers of a wake-up call, at least for sales of existing homes.
If the local housing market does show signs of renewed life this year, the driving forces will be some of the same ones that surfaced late last year: lower home prices, reduced borrowing costs and a growing number of foreclosure sales.
Sales of existing homes, many of them bank-owned properties, have been rising by double-digit percentages in Metro Orlando in recent year-over-year monthly comparisons, and many Realtors expect Orlando to continue outperforming most of the state's other large metro areas this year. Tampa is the only market that has been as strong as Orlando in recent months.
|12.01.2009 18:33:25 - Real Estate Close-Up: Miami (http://www.google.com/hostednews/ap/article/ALeqM5h-be0d4jS06NJwR2-olYNRf3jeWQD95JTB400)|
|Despite record foreclosures, despite double-digit home price declines, and despite scary job losses, Miami's commercial real estate market has rolled with the punches — until now. "We're in a better place than where people thought we would be because of the collapse in the residential market. It's true, it's horrible, but it could be a lot worse," said Stephen Nostrand, an executive vice president at Colliers Abood Wood Fay.
The fear now is that it soon will be.
Industry watchers expect the national recession, new supply of offices and shopping centers and a crippled housing market to finally hit the city's property rents and vacancies this year.
Retail shops will suffer the most. Even though the retail vacancy rate in the greater South Florida area hovered around 5 percent, which is lower than the national average of about 7.5 percent, it's expected to climb steadily this year.
The few retailers entering the market like Kohl's and Ikea will be offset by many other small and mid-size stores closing shop. Job losses this year in Miami are expected to total 15,300, according to CBRE Torto Wheaton Research. That will curb consumer spending, while the national recession will hurt tourism.
"Anecdotally, every week there are more leasing signs up and more dark store fronts," Nostrand said.
|01.04.2007 11:10:05 - Magna Entertainment Corp. announces sale of Palm Beach residential real estate |
|AURORA, ON, March 28 /PRNewswire-FirstCall/ -- Magna Entertainment Corp. ("MEC") (NASDAQ: MECA; TSX: MEC.A) announced today that it has sold 157 acres of excess real estate adjacent to its Palm Meadows Training Center, located in Palm Beach County, Florida, to a subsidiary of MI Developments Inc. ("MID"), its parent company, in return for cash consideration of $35 million. In addition, MEC has been granted a profit participation right in respect of the property under which it is entitled to receive 15% of net proceeds from any sale or development of the property after MID achieves a 15% internal rate of return.
Blake Tohana, Executive Vice-President and Chief Financial Officer of MEC, commented: "This transaction is another step in our efforts to monetize non-core assets. We remain focused on pursuing other non-core asset sales and strengthening our balance sheet."
MEC's consideration of the real estate transactions was supervised by the Special Committee of MEC's board of directors, consisting of Jerry D. Campbell (Chairman), Louis E. Lataif and William J. Menear. The transactions were approved by MEC's board after a favorable recommendation of the Special Committee.
MEC, North America's largest owner and operator of horse racetracks, based on revenue, acquires, develops, owns and operates horse racetracks and related pari-mutuel wagering operations, including off-track betting facilities. MEC also develops, owns and operates casinos in conjunction with its racetracks where permitted by law. MEC owns and operates AmTote International, Inc., a provider of totalisator services to the pari-mutuel industry, XpressBet(R), a national Internet and telephone account wagering system, as well as MagnaBet(TM) internationally. Pursuant to joint ventures, MEC has a fifty percent interest in HorseRacing TV(TM), a 24-hour horse racing television network, and TrackNet Media Group LLC, a content management company formed for distribution of the full breadth of MEC's horse racing content.
This press release contains "forward-looking statements" within the meaning of applicable securities legislation, including Section 27A of the United States Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the United States Securities Exchange Act of 1934, as amended (the "Exchange Act") and forward-looking information as defined in the Securities Act (Ontario) (collectively referred to as forward-looking statements). These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and the Securities Act (Ontario) and include, among others, statements regarding the expected impact the sale of the 157 acres in Palm Beach County, Florida will have on our balance sheet.
Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or the times at or by which such performance or results will be achieved. Undue reliance should not be placed on such statements. Forward- looking statements are based on information available at the time and/or management's good faith assumptions and analyses made in light of our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the circumstances and are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond the Company's control, that could cause actual events or results to differ materially from such forward-looking statements. Factors that could cause actual results to differ materially from our forward-looking statements include, but may not be limited to, material adverse changes: in general economic conditions, the popularity of racing and other gaming activities as recreational activities, the regulatory environment affecting the horse racing and gaming industries, and our ability to develop, execute or finance our strategies and plans within expected timelines or budgets. In drawing conclusions set out in our forward- looking statements above, we have assumed, among other things, that there will not be any material adverse changes: in 1 general economic conditions, the popularity of horse racing and other gaming activities, the regulatory environment, and our ability to develop, execute or finance our strategies and plans as anticipated.
Forward-looking statements speak only as of the date the statements were made. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking statements. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect thereto or with respect to other forward-looking statements.
Source: Magna Entertainment Corp.
|01.04.2007 11:09:42 - Chartwell Seniors Housing Real Estate Investment Trust Treasury Offering of Trust Units and Convertible Debentures |
|CHARTWELL SENIORS HOUSING REAL ESTATE INVESTMENT TRUST ANNOUNCES UNIT FINANCING OF $200.9 MM AND CONVERTIBLE DEBENTURE FINANCING OF $75.0 MM TO FINANCE PROPORTIONATE SHARE OF ACQUISITIONS, MEZZANINE LOANS AND INTERNAL GROWTH INIATIVES TOTALING $725 MM
MISSISSAUGA, ONTARIO--(CCNMatthews - March 29, 2007) -
NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES
Chartwell Seniors Housing Real Estate Investment Trust ("Chartwell") (TSX:CSH.UN) of Mississauga, Ontario today announced that it has agreed to sell, subject to regulatory approval, 14,100,000 Units for $14.25 per Unit for aggregate gross proceeds of $200,925,000 and $75,000,000 of 5.9% subordinated unsecured convertible debentures due May 1, 2012 (the "Debentures") to a syndicate of underwriters led by RBC Capital Markets on a bought-deal basis. Chartwell has granted to the Underwriters an option (the "Underwriters Over-allotment Option"), exercisable in whole or in part up to 30 days after closing, to purchase up to an additional 15% of the Units issued on the same terms as set forth above. This offering is expected to increase Chartwell's market capitalization to approximately $1.4 billion, based on the offering price for the Units.
Chartwell will, within the next few days, file with the securities commissions and other similar regulatory authorities in each of the provinces of Canada, a preliminary short form prospectus relating to the issuance of the Units and the Debentures. Closing of the offering is expected to take place on or about April 20, 2007.
The estimated net proceeds from the Unit and concurrent Debenture offerings will be used to fund certain acquisitions, mezzanine loans and internal growth initiatives and the excess will be used for general business purposes and future acquisitions. Chartwell will use the net proceeds from the Debenture offering for Canadian purposes only.
Use of Offering Proceeds (Chartwell's Proportionate Share)
Cost (1) Mortgages/ Use of
Other (2) Proceeds
From third parties:
Merrill Gardens Southern Portfolio (U.S.) $429,577 $286,253 $143,324
RegencyCare Portfolio $134,088 $76,849 $57,239
Jardins de la Gare $23,026 $15,500 $7,526
Chateau Gardens Elmira AL $6,750 $4,748 $2,002
Subtotal $593,441 $383,350 $210,091
Le Domaine des Forges I $46,464 $37,712 $8,752
Cite-Jardin Phase III A $30,765 $25,489 $5,276
Rouge Valley Retirement Residence $20,300 $14,600 $5,700
The Gardens at Qualicum Beach $19,088 $15,450 $3,638
Total Acquisitions $710,058 $476,601 $233,457
2) Mezzanine Loan Advances $8,992 $0 $8,992
3) Internal Growth Initiatives $5,959 $950 $5,009
4) Remaining Cash From Offering $16,118
Grand Total (net of offering costs) $725,009 $477,551 $263,576
(1) Includes closing and mortgage defeasance costs and foreign currency
exchange rate of $1.1608 for U.S. acquisitions
(2) Includes deferred consideration, deposits and the repayment of
Merrill Gardens Southern Portfolio
Chartwell intends to use approximately $143.3 million of the net proceeds to acquire from Merrill Gardens L.L.C. ("Merrill Gardens") a 100% interest in a high quality seniors housing portfolio comprised of 24 freehold and 2 leasehold interests in retirement home facilities aggregating 2,374 suites located in strong markets throughout the southern United States (collectively the "Merrill Gardens Southern Portfolio" or "Merrill Gardens Properties"). Merrill Gardens is an experienced seniors housing owner/operator which, prior to the acquisition of 26 facilities by Chartwell, owned 68 communities containing over 6,000 suites/units, located in 11 states (Alabama, Arizona, California, Florida, Georgia, Louisiana, Nevada, Oklahoma, Tennessee, Texas and Washington).
The majority of the Merrill Gardens Properties were built within the last ten years, are modern, attractive and incorporate the latest services and innovations in seniors care. With the exception of one facility, all of the Merrill Gardens Properties are licensed as Assisted Living residences and are almost exclusively private pay. Approximately 70% of the resident profile is Independent Living, allowing for residents to age in place through the provision of additional services as required. The Merrill Gardens Properties are well-situated in high demand markets, with a current occupancy of 95%, which is consistent with very strong and stable occupancies in excess of 95% over the last five years. Existing staff at the residences will remain in place, while the Merrill Gardens Southern Portfolio, except those properties located in Alabama, will be managed by Horizon Bay Chartwell ("HBC"), Chartwell's joint venture property management entity in the US market. Closing of this acquisition is expected by the end of April 2007 and is subject only to normal closing conditions.
This acquisition, in connection with the other acquisitions announced year-to-date, are expected to add approximately $0.03 per unit in FFO in 2007, increasing in 2008 after the integration of the Merrill Gardens Properties is complete.
Chartwell intends to use approximately $57.2 million of the proceeds from the concurrent offerings to acquire an economic interest in the RegencyCare portfolio, which comprises eight new, Class A Long Term Care ("LTC") facilities containing 1,384 suites and a management company with long term management contracts for six other LTC facilities containing 814 beds. All of these facilities are well-located in high-growth communities situated in and around the Greater Toronto Area, and all are 100% occupied with waiting lists. Four of the eight sites have excess land zoned for the addition of approximately 400 assisted or independent living units in total. Chartwell, in connection with a joint venture partner, intends to complete the acquisition of a 50% interest in the eight Class A LTC facilities and a 100% interest in the management company in May 2007.
Approximately $50.0 million from the proceeds of Chartwell's November 2006 Unit and Debenture Offerings were expected to be used to complete the acquisition of an economic interest in the RegencyCare portfolio, as described in the prospectus related to that offering. The closing of the RegencyCare portfolio acquisition has, however, been delayed due to regulatory approvals, and is now expected to close in May 2007. In the meantime, additional acquisition opportunities have arisen and were completed by Chartwell through the use of funds expected to have been used for the RegencyCare portfolio acquisition.
Other Use of Net Proceeds
Chartwell intends to use approximately $9.5 million of the net proceeds to acquire 2 additional seniors housing facilities from third party vendors located in Ontario and Quebec, respectively.
Chartwell intends to use approximately $23.4 million of the net proceeds to acquire 4 new seniors housing facilities from Spectrum Seniors Housing Development LP ("Spectrum") and Melior Developments Inc. ("Melior") located in Ontario, Quebec and B.C., respectively.
In addition, approximately $9.0 million of the net proceeds is intended to be used to fund various mezzanine loans to be made by Chartwell Master Care LP during the quarter ending June 30, 2007 in relation to facilities under development and approximately $5.0 million of the net proceeds is intended to be used for internal growth initiatives at 6 of Chartwell's existing properties.
While Chartwell expects to complete the above investment activity, the completion of certain of these acquisitions remains subject to the fulfillment of certain customary conditions, including the completion of due diligence in some cases. Until such time as all conditions have been satisfied or waived, there can be no assurance that these acquisitions will be completed. Any cash remaining from the offering (after Underwriters' fees and offering expenses) will be used to finance potential future acquisitions and mezzanine loans consistent with Chartwell's growth strategy, capital expenditures and for general business purposes.
Chartwell intends to make monthly cash distributions to Unitholders of record on each record date, on or about the 15th day of the month following the record date. Chartwell's current monthly cash distribution is $0.08875 per Unit, representing an approximate yield of 7.5% to an investor. The first cash distribution to which purchasers of the Units under this offering will be entitled to participate will be for the month of April, with a record date of April 30, 2007 and a payment date of May 15, 2007.
The Debentures will bear interest at a rate of 5.9% per annum payable semi-annually in arrears on May 1st and November 1st in each year commencing May 1, 2007. The May 1, 2007 interest payment will represent accrued interest for the period from closing to May 1, 2007. Each Debenture will be convertible into freely tradeable Chartwell trust units at the option of the holder at any time prior to maturity at a conversion price of $16.25 per Unit (the "Conversion Price"), being a ratio of approximately 61.5385 Units per $1,000 principal amount of Debentures, and representing a premium of approximately 14.04% to the Unit offer price. The Debentures will mature on May 1, 2012.
Following the original Tax Fairness Plan announcement on October 31, 2006, the Minister of Finance (Canada) released on December 21, 2006 draft legislation relating to proposed changes to the taxation of income trusts for Canadian federal income tax purposes, which was followed by a Notice of Ways and Means Motion that was released on March 27, 2007 (collectively the "Proposals"). Based on the REIT qualification rules as proposed, Chartwell is of the view that, as it is currently structured and based on its present location of assets and sources of income, it would not qualify as a REIT and would be subject to the proposed income trust tax. The final form of the legislation, however, may change or the legislation may not be passed, thus Chartwell's Special Committee and Chartwell will continue to monitor announcements relating to the proposed taxation of income trusts and market events as they unfold.
Including the aggregate gross proceeds from this Unit and concurrent Debenture offering, Chartwell will exceed the safe harbour limits as set out in the growth guidelines published by the Minister of Finance (Canada) on December 15, 2006. If the Proposals and growth guidelines are enacted, this will result in Chartwell becoming taxable as a specified investment flow-through trust in 2007. In such case, based on Chartwell's structure and operations and its understanding of the Proposals, the aggregate amount of tax payable by Chartwell for each of 2007 and 2008, estimated as of the date hereof, will fall within a range of $0.00 to $0.05 per Unit (including all of the Units issued under the Unit offering), which may, in certain circumstances affect cash available for distribution to unitholders. The estimated tax per unit will not have a material after-tax impact on the cash position of Canadian resident taxable investors owing to the integration of the Canadian tax system (i.e. dividend gross-up and tax credit mechanism). Chartwell considers that this likely tax impact would be less material than failing to take advantage of the many growth opportunities currently available in the marketplace that would maximize Unitholder value.
In the March 19, 2007 Federal Budget, the Minister announced proposed changes to the Tax Act regarding the deductibility of interest (and other borrowing costs) on money borrowed to invest in foreign affiliates. Among other things, these rules will restrict the deductibility of interest (and other borrowing costs) in respect of borrowed money that may reasonably be considered to have been used to assist, directly or indirectly, a particular person with whom the borrower does not deal at arm's length, to acquire a share or indebtedness of a corporation that is a foreign affiliate of the borrower, of a person or partnership that is related to the particular person or partnership or of a person or partnership that does not deal at arm's length with the borrower. For non-arm's length debt incurred prior to March 19, 2007 the restrictions will apply to interest (and other borrowing costs) payable after 2008, for arm's length debt incurred prior to March 19, 2007 the restrictions will generally apply to interest (and other borrowing costs) payable after 2009, and for debt incurred on or after March 19, 2007 the restrictions will apply to interest (and other borrowing costs) payable after 2007. Based on Chartwell's current understanding of these proposed rules, certain assumptions that are reasonable in Chartwell's view, and assuming the aforementioned rules will be enacted as proposed, the estimated increase in tax payable by Chartwell in 2009 as a result of these proposed rules should not exceed approximately $0.01 per Unit (including all Units to be issued under the Unit offering). Chartwell will endeavour to restructure the financing of its investments in foreign affiliates prior to 2009 to minimize the impact of these proposed rules. Chartwell expects that these proposed rules will not materially impact the deductibility of interest (or other borrowing costs) on the Debentures issued under the Debenture offering and debt incurred in the future.
The Units and Debentures being offered have not been and will not be registered under the United States Securities Act of 1933 and state securities laws. Accordingly, the Units and Debentures may not be offered or sold to U.S. persons except pursuant to applicable exemptions from registration.
Chartwell is currently the largest participant in the Canadian seniors housing business with a substantial and growing presence in the United States. Chartwell is an unincorporated, open-end real estate investment trust governed by the laws of the Province of Ontario. Chartwell is a growth-oriented investment trust owning and managing a complete spectrum of seniors housing communities. Chartwell will capitalize on the strong demographic trends present in its markets to grow internally and through accretive acquisitions. Chartwell also has an exclusive option to purchase stabilized communities from Spectrum Seniors Housing Development LP, Canada's largest and fastest growing seniors housing development company.
Additional information on Chartwell Seniors Housing REIT is available on Chartwell's web site at: www.chartwellreit.ca.
This press release contains forward-looking statements that reflect the current expectations of management of Chartwell and Chartwell Master Care LP ("Master LP") (Master LP together with its general partner and subsidiaries, the "Operator") about the future results, performance, achievements, prospects or opportunities for Chartwell, the Operator and the seniors housing industry. Chartwell has tried to identify these forward-looking statements relating to its general affairs as well as for statements concerning the completion of any proposed transaction, intended financing arrangement and the effects on Chartwell of such acquisitions and financings as a result thereof by using words such as "may", "will", "expect", "anticipate", "believe", "intend", "plan", "estimate", "potentially" and similar expressions. Such forward-looking statements necessarily involve known and unknown risks and uncertainties that may cause Chartwell or the Operator or the industry's actual results, performance, achievements, prospects and opportunities in future periods to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, risks related to: business risks; real property ownership and lack of diversity; geographic concentration; continued growth; acquisition and development; competition; debt financing; mezzanine financing; environmental liabilities; US/Canadian exchange rate fluctuations; government regulations; operations in the United States; joint venture interests; liability and insurance; personnel costs; labour relations; conflicts of interest; management contracts; availability of cash flows; the redemption right of Unitholders; accounting guidelines; dilution; nature of Units; Unitholder liability; market for Units and Unit price; matters affecting trading prices of convertible debentures; credit risk and prior ranking indebtedness; absence of covenant protection; and tax, including changes to tax laws. There can be no assurance that the expectations of management of Chartwell will prove to be correct.
|01.04.2007 11:08:32 - Monmouth Real Estate Investment Corporation and Monmouth Capital Corporation to Combine in a Strategic Transaction Valued at $90.2 million |
|FREEHOLD, N.J., March 26 /PRNewswire-FirstCall/ -- Monmouth Real Estate
Investment Corporation (Nasdaq: MNRTA) and Monmouth Capital Corporation
(Nasdaq: MONM), announced today that they have entered into a definitive
agreement to complete a strategic combination of the two companies. After
the transaction is consummated, the combined company will operate under the
name Monmouth Real Estate Investment Corporation and will continue as an
equity real estate investment trust, owning interests in 55 industrial
properties on long-term net-leases to investment grade tenants, as well as
investments in REIT securities.
The definitive agreement provides that Monmouth Capital Corporation
("Monmouth Capital") will merge with a wholly-owned subsidiary of Monmouth
Real Estate Investment Corporation ("Monmouth REIT") and each share of
Monmouth Capital's common stock will be converted into and exchanged for
the right to receive 0.655 shares of Monmouth REIT's common stock. Monmouth
Capital's outstanding options and convertible debentures will remain
outstanding and will become exercisable or convertible for Monmouth REIT's
common stock at adjusted strike prices and conversion prices, as
applicable, that reflect the exchange ratio. Based on the closing market
prices as of March 23, 2007, the combined company would have an enterprise
value of approximately $400.8 million. Following the consummation of the
merger, Monmouth REIT's stockholders will own approximately 84.5% and
Monmouth Capital's stockholders will own approximately 15.5% of the
combined company, assuming no conversion of Monmouth Capital's outstanding
"The combination of Monmouth Real Estate Investment Corporation and
Monmouth Capital Corporation enhances our prospects for continued growth
and exposure in the marketplace through increased market capitalization and
an expanded shareholder base," said Eugene W. Landy, President and Chairman
of both Monmouth REIT and Monmouth Capital. "The core assets of the two
companies are complementary and the consolidation will enable management to
utilize existing capital and resources more efficiently while providing
stockholders with a portfolio of assets with enhanced tenant and geographic
diversification. The transaction is expected to be accretive to Monmouth
REIT's projected stand-alone funds from operations. An additional
significant benefit will be the productivity savings achieved through
managing a larger, combined company."
Following the merger, the combined company will remain headquartered in
Freehold, New Jersey and will be managed by the management team that
currently manages both Monmouth REIT and Monmouth Capital. It is
anticipated that each company will continue to pay regularly-scheduled
dividends through the closing date, which is expected to occur during the
third calendar quarter of 2007. Closing of the transaction is subject to
customary closing conditions, including approval of the transaction by the
stockholders of Monmouth Capital and Monmouth REIT.
Cohen & Steers Capital Advisors, LLC acted as exclusive financial
advisor to the Special Committee of the Board of Directors of Monmouth REIT
and Venable LLP is serving as its legal counsel. Ferris, Baker Watts, Inc.
acted as exclusive financial advisor to the Special Committee of the Board
of Directors of Monmouth Capital and Stroock & Stroock & Lavan LLP is
serving as its legal counsel.
About Monmouth Real Estate Investment Corporation
Monmouth REIT, which was organized in 1968, is a publicly-owned real
estate investment trust specializing in net-leased industrial properties.
Monmouth REIT's equity portfolio consists of forty-two industrial
properties and one shopping center located in New Jersey, New York,
Connecticut, Maryland, Michigan, Mississippi, Missouri, Massachusetts,
Iowa, Illinois, Nebraska, North Carolina, South Carolina, Kansas,
Pennsylvania, Florida, Virginia, Ohio, Wisconsin, Arizona, Georgia, and
Colorado. In addition, Monmouth REIT owns a portfolio of REIT securities.
About Monmouth Capital Corporation
Monmouth Capital's equity portfolio consists of thirteen industrial
properties in Florida, Georgia, Illinois, Minnesota, New Jersey, New York,
Ohio, Pennsylvania, Tennessee, Texas and Virginia. Monmouth Capital has
operated as a public company since 1961.
This press release contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. All statements other than statements of
historical facts included in this press release are forward-looking
statements. All forward-looking statements speak only as of the date of
this press release. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause the actual
results, performance, achievements or transactions of Monmouth REIT,
Monmouth Capital and their affiliates or industry results or the benefits
of the proposed merger to be materially different from any future results,
performance, achievements or transactions expressed or implied by such
forward-looking statements. Such risks, uncertainties and other factors
relate to, among others, difficulties encountered in integrating the
companies, approval of the transaction by the stockholders of the
companies, the occurrence of any event, change or other circumstances that
could give rise to the termination of the definitive agreement, the outcome
of any legal proceedings that may be instituted against either of the
companies or others following announcement of the definitive agreement, the
satisfaction of closing conditions to the transaction, inability to realize
or delays in realizing the expected synergies, unanticipated operating
costs, the effects of general and local economic and real estate conditions
and the amount of the costs, fees, expenses and charges related to the
transaction. Additional information or factors which could impact the
companies and the forward-looking statements contained herein are included
in each company's filings with the Securities and Exchange Commission. The
companies assume no obligation to update or supplement forward-looking
statements that become untrue because of subsequent events.
Additional Information about the Combination and Where to Find It
This press release does not constitute an offer of any securities for
sale. In connection with the proposed transaction, Monmouth REIT and
Monmouth Capital expect to file a joint proxy statement/prospectus as part
of a registration statement regarding the proposed merger with the
Securities and Exchange Commission. Investors and security holders are
urged to read the joint proxy statement/prospectus because they will
contain important information about Monmouth REIT and Monmouth Capital and
the proposed merger. Investors and security holders may obtain a free copy
of the definitive proxy statement/prospectus, and other documents filed by
Monmouth REIT and Monmouth Capital with the SEC, at the SEC's website at
http://www.sec.gov. The definitive joint proxy statement/prospectus and other
relevant documents may also be obtained free of charge from Monmouth REIT
and Monmouth Capital by directing such request to either company at Juniper
Business Plaza, 3499 Route 9 North, Suite 3-C, Freehold, New Jersey 07728,
Attention: Susan Jordan. Investors and security holders are urged to read
the proxy statement/prospectus and other relevant material when they become
available before making any voting or investment decisions with respect to
Monmouth REIT and Monmouth Capital and their respective directors and
executive officers may be deemed to be participants in the solicitation of
proxies from the stockholders of Monmouth REIT and Monmouth Capital in
connection with the merger. Information about Monmouth REIT and Monmouth
Capital and their respective directors and executive officers is set forth
in the respective annual proxy statements and Annual Reports on Form 10-K
for Monmouth REIT and Monmouth Capital, which can be found on the SEC's
website at http://www.sec.gov. Additional information regarding the interests of
those persons may be obtained by reading the proxy statement/prospectus
when it becomes available.
|01.04.2007 11:07:38 - Flipped in Florida: Sellers face the housing bust |
|THERE'S SOMETHING about Florida residential real estate that attracts speculators like an alligator to an easy meal.
Abundant sunshine has been known to distort investors' perception of the laws of economics from the 1890s to the present. With tens of thousands of properties languishing on the market, the quick profits seem to have evaporated.
The experience of Beth and Fabrizio Faieta, who have bought five homes in the Fort Myers-Naples area over the past few years, provides a tale of what happens when home prices sour.
The Faietas aren't your typical Florida "flippers" who had hoped to buy and sell properties within six months of purchase, though. They said their holdings were intended to be long-term investments. Yet as the market stalled, buyers were scarce and expenses rose, and they were forced to sell.
Homes are plentiful in southwest Florida. There are for-sale signs on almost every other property on the most desirable road that embraces the graceful, white-sand beaches of the Gulf of Mexico. Local newspapers carry four or more sections of real-estate advertising.
When the Faietas arrived in the Fort Myers area from Massachusetts 21/2 years ago, homes were in high demand in the Sunshine State. "We had to put in offers the same day we saw them or they were gone," says Beth, who was a part-time real-estate agent in Massachusetts.
Lower asking price
One of their investments, a three-bedroom home in Bonita Springs, was bought from an owner who had to sell. With 4.62 percent financing in September 2004, they bought it for $260,000. The house originally listed for $395,000.
Although they have had no problem renting the Bonita home — my family and I leased it — with the slack market, they have had trouble selling it on their own. They recently signed on with a local real-estate agent and have reduced the asking price of almost $400,000 to $359,900.
Like so many formerly torrid markets, southwest Florida home prices are in retreat. Prices fell 2 percent in the fourth quarter of last year in the Naples area and more than 1 percent in Fort Myers after more than doubling in value over a five-year period, according to the Office of Federal Housing Enterprise Oversight, the watchdog agency for the mortgage companies Freddie Mac and Fannie Mae.
"We purchased the house with the thinking that we would like to keep it long term," Beth says. "I am not happy to sell it. I am also not happy that we are putting our other properties up for sale."
When buyers abound, few investors think about the long-term costs of holding properties. Yet a rapidly rising market that brakes suddenly, combined with unique local conditions, presents pitfalls.
In Florida, as in most coastal areas in the southern U.S., the wave of hurricanes in 2005 led to skyrocketing homeowner insurance premiums. Some insurers even stopped selling policies and dropped coverage in storm-prone states.
For the Faietas' Bonita property, that meant an initial premium of $999 for their single-level house about a mile from the Gulf rose to $1,407. Beth expects it to climb even more in August. Another home they own in Naples had rates rise from $2,400 to $7,400.
A boom market also translates into higher assessed property values, which push up real-estate taxes.
The Faietas paid a bargain $1,200 in property taxes for their Bonita house in the first year of ownership. Last November, the levy was $3,768. The dramatic increase in taxes is front-page news for all Florida residents now, particularly those who were originally drawn by the lack of a state income tax and relatively inexpensive housing costs.
As if skyrocketing insurance and taxes weren't enough to give Florida home investors cold feet, the market is glutted with properties.
Within sight of the Faietas' property are three similar homes for sale. According to the Naples Area Board of Realtors, there are
11,000 houses on the market — an 18-month supply —and more than 2,900 homes under construction in neighboring Lee County.
The flippers who at one time accounted for as much as 50 percent of purchases in the Fort Myers-Naples area have largely retreated to the sidelines, responsible for no more than 2 percent of sales, according to Homesmartreports.com, a home information service in San Juan Capistrano.
A combination of slower sales, higher mortgage rates, large inventories and cash-strapped flippers being forced to sell is tilting the balance to buyers now.
Doug Brunner, a real-estate agent at Downing-Frye Realty Inc. in Bonita Springs, says: "Two years ago, it was common to see sales contracts written at 90 percent of the original list price. Now it is common to see listings reduced by anywhere from 20 percent to 33 percent before an offer is made."
While housing starts and existing-home sales both unexpectedly rose in February, don't expect a quick turnaround. The supply of homes for sale increased almost 6 percent last month, creating a supply of 6.7 months, according to the National Association of Realtors, a Chicago-based industry group. With almost 3.8 million homes on the market, that's still a hefty inventory to be absorbed.
Nationwide, the possibility exists that as many as 1.5 million more homes will come on the market from foreclosures of sub-prime mortgages.
In the interim, that means healthy discounts for patient buyers, and more pressure on long-term investors such as the Faietas to sell their properties.
This is a pattern being repeated all over the country from California to Massachusetts as investors who piled into the home market discover the painful realities of the supply-demand curve.
Source: Bloomberg News