Granite to Acquire German Logistics Property and Sell Aurora, Ontario Office Properties

Granite Real Estate Investment Trust (“Granite”) (TSX: GRT.UN / NYSE: GRP.U) announced today that it has entered into an agreement to acquire a warehouse and logistics property in Erfurt, Germany consisting of approximately 717,000 square feet of gross leasable area.

The purchase price of euro 53.9 million represents an in-going yield of approximately 5.4% excluding transaction costs. The property is located in one of Granite’s core European markets and builds on Granite’s existing presence in the German logistics market.

The property which was built in 2010 is fully leased with a weighted average lease term of approximately 4.7 years.

The primary tenant is LGI TechLog GmbH, a German subsidiary of Elanders Group, a public Swedish company traded on the NASDAQ OMX Nordic Exchange, which is a global provider of supply chain management and e-commerce logistics services. The transaction will be immediately accretive to funds from operations and adjusted funds from operations and will be funded from a combination of cash on hand and Granite’s credit facility. The transaction is expected to close during the third quarter of 2018.

Granite also announced today that it recently entered into an agreement to sell its office properties in Aurora, Ontario that serve as the corporate headquarters for Magna International Inc. (“Magna”). The sale will generate total gross proceeds of $60 million representing a capitalization rate of approximately 6.2%. The sale will be accretive to Granite’s net asset value and is subject to customary closing conditions with the closing expected to take place towards the end of the third quarter of 2018.

Michael Forsayeth, Granite’s CEO, commented that “Together with the sale of Magna’s corporate headquarters being net asset value accretive and consistent with Granite’s strategy, these transactions will further reduce Granite’s Magna concentration.”


This press release may contain statements that, to the extent they are not recitations of historical fact, constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities legislation, including the United States Securities Act of 1933, as amended, the United States Securities Exchange Act of 1934, as amended, and applicable Canadian securities legislation. Forward-looking statements and forward-looking information may include, among others, statements regarding Granite’s plans, goals, strategies, intentions, beliefs, estimates, costs, objectives, economic performance, expectations, or foresight or the assumptions underlying any of the foregoing. Words such as “may”, “would”, “could”, “will”, “likely”, “expect”, “anticipate”, “believe”, “intend”, “plan”, “forecast”, “project”, “estimate”, “seek”, “objective” and similar expressions are used to identify forward-looking statements and forward-looking information. Forward-looking statements and forward-looking information should not be read as guarantees of performance or results and will not necessarily be accurate indications of whether or the times at or by which such performance or results will be achieved.

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