TORONTO, ONTARIO--(Marketwire - Jan. 24, 2013) - Mitchell Cohen, President and Chief Executive Officer of Urbanfund Corp. (TSX VENTURE:UFC) ("Urbanfund" or the "Company"), announced today that Urbanfund has entered into a conditional purchase agreement with an arm's length party for the acquisition of 10% of an 1,870 unit multi-family residential portfolio located in Quebec City and Montreal, Quebec (the "Portfolio").
The total purchase price for the 10% purchase is approximately $7,225,000 prior to customary adjustments. The average "going in" capitalization rate of this transaction is estimated at 6.40%. Most of the properties included in the transaction have existing mortgages at competitive market rates. Of the 1,870 units, 312 are located in Montreal with the remainder in Quebec City.
The remaining 90% of the Portfolio continues to be owned by Westdale Construction Co. Limited ("Westdale"). Mr. Ronald S. Kimel, the Chairman and Director of Urbanfund, is the principal shareholder of Westdale. Property Management will be done by La Corporation Headway Ltee which is owned 10% by Urbanfund and 90% by Westdale.
The transaction is conditional on Urbanfund completing due diligence to its satisfaction, securing the approval of the current lenders and satisfying any regulatory requirements (including approval of the TSX Venture Exchange). Closing is expected to occur in late February 2013. Satisfaction of the purchase price will be through a combination of cash on-hand and a vendor take-back mortgage at competitive rates.
Urbanfund Corp. is a Toronto-based real estate development and operating company. The Company's focus is to identify, evaluate and invest in real estate or real estate projects. The Company's assets are located in Toronto, Belleville and London, Ontario. The Company is a reporting issuer in Alberta, British Colombia and Ontario. The Company's common shares trade on the TSX Venture Exchange under the symbol 'UFC'.
This press release contains certain forward-looking statements, which reflect Management's expectations regarding the Company's growth, results of operations, performance and business prospects and opportunities. Statements about the completion of the acquisition constitute forward-looking statements. Wherever possible, words such as "may", "will", "should", "could", "expect", "plan", "intend", "anticipate", "believe", "estimate", "predict" or "potential" or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect Management's current beliefs and are based on information currently available to management as at the date hereof.
Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including: general economic and market segment conditions, interest rates, costs outside of the Company's control such as Real Estate Taxes and utilities, the ability of tenants to satisfy their contractual rent obligations and any unforeseen repair, maintenance or replacement of the Company's assets. More detailed assessment of the risks that could cause actual results to materially differ than current expectations is contained in the "Risks and Uncertainties" section of the Company's most recent Management's Discussion and Analysis.