Electra Real Estate Ltd. (TASE:ELCRE) is selling four properties in Canada for C$114.8 million (NIS 388 million), as part of the sale of its portfolio in the country, announced in June, in order to exploit the strong Canadian dollar. The sale will be closed in the first quarter of 2014.
Electra Real Estate owns 90% of the four properties, and its share of the proceeds will total NIS 349.2 million. The company will report a net cash flow of $C30.4 million (NIS 102.8 million on the sale, after deducting the bank loans on the properties, taxes, and transaction costs.
Although the company books the properties at C$111 million, because of C$2.4 million (NIS 8.1 million) in transaction costs and C$4 million in interest rate differentials, it will report a net loss of C$5 million (NIS 16.9 million) on the sale.
The four properties sold are an 18,110-square meter office building in downtown Montreal and a 28,800-square meter three-building Complexe Metro Longueuil in the city. The company bought the properties for C$69 million (NIS 233.2 million) in 2002-07, and reported handsome gains from the rise in their fair value valuations.
This is the latest sale by Electra Real Estate, which has netted the company NIS 101 million in free cash flow over the past six months. The company also sold a Chicago office building for $112.5 million (NIS 405 million in August, and sold its 50% share in three Swiss properties for CHF 29.6 million (NIS 113 million).
Electra Real Estate is planning a NIS 100 million private equity placement, in which parent company, Elco Holdings Ltd. (TASE: ELCO), may invest NIS 50 million. Electra Real Estate owns 46 income-producing properties in Israel, the US, Canada, Germany, Switzerland, and the UK with a total area of 750,000 square meters (including parking garages
Published by Globes [online], Israel business news - www.globes-online.com - on October 27, 2013
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