Electra Real Estate in NIS 191m Winnipeg deal

The building is leased to MTS Allstream, at C$6.6 million a year, generating a net return on investment of 7.6%.

Electra Real Estate Ltd. (TASE:ELCRE) and a partner have bought a building in Winnipeg, Manitoba Canada for C$51.1 million (NIS 191 million) in a buy and lease-back deal. Electra Real Estate is a 75% partner in the deal, amounting to NIS 143 million. The building is leased to Canadian telecommunications giant MTS Allstream Inc. under a 15-year lease, through 2021, with no early release option, at C$6.6 million a year. Net annual rental income, after maintenance and management costs, is C$3.9 million (NIS 14.2 million), giving a return on investment of 7.6%.

Electra Real Estate and its partner will finance 80% the purchase with a ten-year non-recourse loan of C$40.9 million (NIS 148.5 million), at 5.1% interest.

In October, Electra Real Estate increased its stake in a Canadian company that owns two office buildings in Toronto for NIS 65 million. Last week, the company announced that it was negotiating to buy a 10% interest in the ₤1.1 billion deal to buy 47 Marriott hotels in the UK by a consortium of Delek Real Estate Ltd. (TASE: DLKR), Blenheim Property Group Ltd., owned by Igal Ahouvi, and Irish REIT Quinlan Private, for NIS 875 million.

Published by Globes [online], Israel business news - www.globes.co.il - on December 31, 2006

© Copyright of Globes Publisher Itonut (1983) Ltd. 2006

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