Summit Industrial Income Reit acquires first GTA property
Summit Industrial Income Reit is to acquire a 142,000 square foot light industrial property in the Greater Toronto Area.
Situated in Etobicoke, Ontario close to Toronto's Pearson International Airport and major highways and transportation links, the property is 100 per cent occupied, leased to a single national tenant for a ten-year term that commenced on 1 May 2012.
The Reit will pay approximately CAD9.4m for the property, financed by a new CAD5.4m five-year mortgage incurring an interest rate of 3.75 per cent with the balance in cash from the Reit's revolving credit facility. Closing is anticipated on or before 31 December 2012. The purchase price equates to a solid acquisition cost of CAD66.00 per square foot and a strong initial capitalisation rate of 7.7 per cent.
"This is our first purchase in the key Greater Toronto Area. Going forward, we intend to aggressively grow our portfolio in the region focusing primarily on accretive acquisitions of properties at values at or below replacement cost that generate stable, consistent and increasing cash flows," says Paul Dykeman, chief executive officer.