Toronto firm raising capital to finance $133M Ottawa-Gatineau shopping centres deal

Loblaws
The Loblaws at Gloucester City Centre. Via Google Maps

A Toronto-based real estate firm is raising capital to finance its new stake in a portfolio of shopping centres across Ontario and Quebec, half of which are in the National Capital Region.

Firm Capital Property Trust announced Wednesday it will raise $26.2 million through a share offering and an additional $15 million in a related private placement. If overallotment options are exercised on the deal, the Toronto firm’s gross proceeds from the financing will increase to more than $45 million.

Firm Capital is raising the extra cash to finance the acquisition of a 50-per-cent interest stake in a portfolio of six shopping centre properties owned by First Capital Realty. Firm Capital will pay $133 million for the stake in more than one million square feet of property primarily anchored by grocery stores.

The deal includes stakes in Carrefour du Plateau in Gatineau as well as the Merivale Mall and Gloucester City Centre properties in Ottawa. Gloucester, the largest property in the deal at 370,000 square feet, is anchored by a 124,000-square-foot Loblaws. The three National Capital Region shopping centres represent more than 80 per cent of the deal’s total square footage, with the remaining three smaller properties in Repentigny, Que.

Upon closing, Firm Capital will enter into a co-ownership agreement with First Capital, the latter of which will maintain property management services at the properties.

The deal is expected to close on in early May.