Slate Office REIT has entered into an agreement to sell a nine-story office property in Toronto for $27.3 million to an undisclosed buyer. The REIT expects to use the net proceeds to reduce outstanding debt. The deal is expected to officially close in the second quarter of 2019.
The nine-story building, located at 225 Duncan Mill Road in the North York neighborhood of Toronto, is about a 45-minute drive from downtown Toronto. The sale of the 156,623-square-foot property will occur at a 19.5 percent, or $4.5 million premium, to the REIT’s purchase price in March 2018 and represents a levered internal rate of return of approximately 50 percent.
“The disposition of 225 Duncan Mill Road is another example of the REIT’s ability to source and execute on transactions that generate meaningful returns for unitholders,” said Scott Antoniak, CEO of Slate Office REIT, in prepared remarks. “This disposition will reduce leverage and create liquidity for new opportunities in the future.”
Last summer, Slate Office REIT acquired a 23-story office building in downtown Chicago for $156 million from Lincoln Property Co.
Image via Google Street View