TORONTO, ONTARIO--(Marketwired - July 6, 2016) -


NorthWest Healthcare Properties Real Estate Investment Trust (the "REIT" or "NorthWest") (TSX:NWH.UN) is pleased to announce approximately $100 million of new capital in a bought deal financing of approximately $50 million of trust units and $50 million aggregate principal amount of 5.25% convertible unsecured subordinated debentures to support the accretive acquisition of high quality healthcare real estate in its core international markets. The REIT intends to use the net proceeds to fund a portion of its previously announced strategic investments in Australia and New Zealand and to fund a portion of the pending acquisitions of two hospitals in Sao Paulo and Brasilia, Brazil occupied by Rede D'Or (collectively, the "Transactions").

Taking into account the Transactions, which are expected to be completed by the end of Q3 2016, the REIT expects its key metrics over the next twelve months to be positively impacted as follows:

  • Annualized AFFO to $0.95/unit when including the $325 million of accretive acquisitions which are expected to be completed by the end of Q3 2016;
  • Loan-to-Value at the mid-point of the REIT's target range of 50% to 55%, underpinned by $130 million of accretive equity issuance and $140 million of portfolio revaluations over the last 12 months; and,
  • NAV in line with previous management estimates in the range of $10.50/unit - $11.00/unit.

In addition to improving NorthWest's financial profile, the Transactions significantly increase the REIT's investment in long-term, inflation-indexed healthcare real estate located in the top global healthcare markets. On a pro forma basis including the Transactions, approximately 45% of the REIT's Adjusted Net Operating Income will be derived from hospitals with 55% of the REIT's Adjusted Net Operating Income generated from its international markets of Australia, New Zealand, Brazil and Germany. The REIT's portfolio occupancy and weighted average lease expiry term metrics are expected to increase to 96.5% and 11.0 years, respectively.

Commenting on the Transaction, NorthWest Chairman and CEO Paul Dalla Lana said:

"Our focus has been on efficiently allocating capital to acquire and develop high-quality healthcare real estate assets in major international markets with leading operators. The Transactions achieve this objective, adding to the REIT's strong existing platform and recent results by improving portfolio quality and providing near-term accretion and long-term growth potential."


NorthWest has entered into an agreement, on a "bought deal" basis, to issue a combination of 5,105,000 trust units (the "Units") at a price of $9.80 per unit for gross proceeds of approximately $50 million and $50 million aggregate principal amount of 5.25% convertible unsecured subordinated debentures due July 31, 2021 (the "Debentures") at a price of $1,000 per Debenture, for aggregate gross proceeds of approximately $100 million (collectively, the "Offering"). The Debentures will be convertible at the holder's option into units of the REIT at a conversion price of $12.75 per unit.

The Offering is being led by a syndicate of underwriters led by RBC Capital Markets, BMO Capital Markets and National Bank Financial. The REIT has also granted the underwriters the option to purchase up to an additional 765,750 Units and $7.5 million of Debentures to cover over-allotments, if any, exercisable in whole or in part anytime up to 30 days following closing of the Offering.

The Offering is subject to normal regulatory approvals, including approval of the Toronto Stock Exchange. The Offering is expected to close on or about July 25, 2016.

The Units and Debentures will be offered by way of a short form prospectus in all of the provinces and territories of Canada and may also be offered by way of private placement in the United States.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.


NorthWest continues to successfully execute on its strategy of acquiring high-quality healthcare real estate assets in its core markets globally. The REIT intends to use the net proceeds of the Offering to partially fund the following transactions which total approximately $325 million:

  • The previously announced strategic investment in Australia, through its acquisition of the external manager and an interest of up to 19.9% in Generation Healthcare REIT (ASX:GHC) ("Generation REIT"). The total investment is for $56 million (A$58.5M) for the external manager and $90 million (A$95.5M) for the Generation REIT units.
  • The previously announced participation in the rights offering of New Zealand-based Vital Healthcare Property Trust (NSX:VHP) ("Vital Trust"), to maintain NorthWest's approximate 24.4% strategic investment in Vital is for approximately $35 million (NZ$39.0M).
  • The pending acquisition of two hospitals totaling $140 million (R$358.5M), located in NorthWest's existing core markets of Sao Paulo and Brasilia, Brazil. The hospitals will be leased on new 25-year leases to Rede D'Or, growing the relationship with an existing NorthWest tenant who is the leading operator of private hospitals in the country. The investment will generate a going-in cap rate of 9.7%, with the leases being adjusted annually to inflation.

The balance of the proceeds needed to complete the Transactions are expected to be funded through asset-level financing (which may include secured property financing as well as loans secured by shares of Vital Trust and Generation REIT) and the REIT's revolving credit facility. These asset-level financings are expected to be completed on terms similar to the REIT's existing facilities. The Transactions are expected to close over the course of the third quarter.

About NorthWest Healthcare Properties Real Estate Investment Trust

NorthWest Healthcare Properties Real Estate Investment Trust (TSX:NWH.UN) is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. The REIT provides investors with access to a portfolio of high quality international healthcare real estate infrastructure comprised of interests in a diversified portfolio of 137 income-producing properties and 8.9 million square feet of gross leasable area located throughout major markets in Canada, Brazil, Germany, Australia and New Zealand. The REIT's portfolio of medical office buildings, clinics, and hospitals is characterized by long term indexed leases and stable occupancies. With a fully integrated and aligned senior management team, the REIT leverages over 180 professionals across 9 offices in 5 countries to serve as a long term real estate partner to leading healthcare operators.

Forward-Looking Statements

This news release contains "forward-looking statements" within the meaning of applicable securities laws, including, without limitation, statements regarding the completion of the Transactions, the Offering, the financing of the Transactions, the benefits of the Transactions (including the extent to which they will be accretive), going in cap rates and revised 12 pro forma operating metrics, including annualized AFFO / unit, loan-to-value, NAV, occupancy and weighted average lease expiry. The forward-looking statements in this news release are based on certain assumptions, including that all conditions to completion of the Transactions and the Offering will be satisfied or waived, the REIT will complete the Transactions on the terms anticipated, revenue and costs associated with the assets acquired in connection with the Transactions will meet the REIT's expectations, significant additional costs will not have to be incurred by the REIT, exchange rates remain consistent and the other assumptions referenced under the heading "Forward-Looking Information Advisory" in the REIT's most recently filed management's discussion and analysis. They are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the risk that the Transactions and the Offering will not be completed on the terms proposed and the factors discussed under the heading "Risk Factors" in the REIT's annual information form available at There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in these forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, the REIT assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Non-IFRS Financial Measures

AFFO, Adjusted Net Operating Income and going-in cap rate are not measures recognized under IFRS and do not have a standardized meaning prescribed by IFRS. Such measures are presented in this news release because management of the REIT believes that such measures are relevant in interpreting the performance of the REIT's assets. Such measures, as computed by the REIT, may differ from similar computations as reported by other similar organizations and, accordingly, may not be comparable to measures reported by such other organizations. Please see the REIT's most recent management's discussion and analysis for how the REIT reconciles AFFO and Adjusted Net Operating Income to the nearest IFRS measure.

Contact Information:

NorthWest Healthcare Properties Real Estate Investment Trust
Paul Dalla Lana
(416) 366-8300 x 1001