TORONTO and MONTREAL, March 26, 2020 (GLOBE NEWSWIRE) -- Nexus Real Estate Investment Trust (the "REIT") (TSXV: NXR.UN) announced today that it is progressing with plans to maximize value at its Richmond BC property.  

The REIT has entered into lease agreements with two new tenants in respect of approximately 60,000 square feet of space previously occupied by an industrial tenant at its Richmond, BC property. Net rents under these leases are approximately $23 per square foot higher than the rents the REIT was receiving from the former industrial tenant prior to early termination. The leases are expected to commence in early 2021, following build out and improvements to the space to ready it for occupancy by the new tenants. Following this investment, net operating income is expected to increase by $1.4 million annually under these new tenancies, as compared to net operating income under the previous tenancy.    

The new leases were arranged by the vendor of the Richmond property (our “Richmond Partner”), who will also manage the development of the property. The REIT is also in the planning stage for an approximately 70,000 square  foot addition to the property, which would be constructed and leased jointly with our Richmond Partner, who has relationships with tenants interested in leasing the space when complete. Subject to market conditions and  pre-leasing, construction of the addition would begin in 2021.  

Pursuant to a development management agreement entered into between our Richmond Partner and the REIT, the increase in the value of the property over what the REIT paid for it, and what is invested to enhance the value of the property, will be split between the REIT and our Richmond Partner. The first $20 million of value enhancement will be for the benefit of the REIT, the next $20 million will be for the benefit of our Richmond Partner, and all increases in value exceeding $40 million will be split equally between our Richmond Partner and the REIT. Our  Richmond Partner has agreed to receive units of the REIT, valued at the greater of $2.30 per unit or the minimum price allowed under stock exchange rules and policies, in settlement of its share of the value enhancement.

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/7f5ce573-f6f5-49a8-a4f7-eac749ea8651

RSU Grant For 2019 Service

The REIT also announced today that it, in respect of 2019 service, it has granted an aggregate of 189,687  restricted units (“RSUs”) to the Chief Executive Officer and the Chief Financial Officer of the REIT under it’s Incentive Unit Plan, and an aggregate of 27,781 RSUs to other employees. In accordance with the Incentive Unit Plan, the grant was made 5 days after the REIT exited its internal blackout period.

These RSUs will vest one-third on the date of issuance, one-third on February 28, 2021 and one-third on February 28, 2022 and are priced at 1.449756 per unit, the volume-weighted average trading price of units of the REIT for the 5 trading days prior to the grant date.

The REIT is authorized to issue up to 4,448,704 units under the Incentive Unit Plan. In total 353,694 restricted share units have been issued to date under the plan, including 5,878 Distribution Equivalent Units.   

About Nexus REIT

Nexus is a growth oriented real estate investment trust focused on increasing unitholder value through the acquisition, ownership and management of industrial, office and retail properties located in primary and secondary markets in North America. The REIT currently owns a portfolio of 72 properties comprising approximately 4.0 million square feet of rentable area. The REIT has approximately 105,848,000 units issued and outstanding. Additionally, there are Class B LP units of subsidiary limited partnerships of Nexus REIT issued and outstanding, which are convertible into approximately 23,025,000 REIT units.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information please contact:
Kelly C. Hanczyk, CEO at (416) 906-2379 or
Rob Chiasson, CFO at (416) 613-1262.