TORONTO, ONTARIO and GREENSBORO, NORTH CAROLINA--(Marketwire - Nov. 21, 2011) - RioCan Real Estate Investment Trust ("RioCan") (TSX:REI.UN) and Tanger Outlet Centers, Inc. ("Tanger") (NYSE:SKT), today announced that through their co-ownership agreement conditions pursuant to a purchase and sale agreement have been waived to acquire Cookstown Outlet Mall on a co-ownership basis. The co-owners expect to acquire the property on a 50/50 basis at an anticipated purchase price of $62 million (Canadian dollar, at 100%), which includes the consideration paid for excess density. RioCan will provide development and property management services and Tanger will provide leasing and marketing services. The joint venture will assume the in place financing of $30 million (Canadian dollar) which carries an interest rate of 5.1% and matures in 2014.
Cookstown Outlet Mall is located approximately 50 kms north of the Greater Toronto Area (GTA) directly off of Highway 400 in the town of Innisfil, Ontario. The property was built in 1995 and is approximately 161,000 square feet with the potential to expand the property to approximately 320,000 square feet. This well established outlet centre features many national retailers such as, Coach Outlet, BCBGMAXAZRIA, Tommy Hilfiger Outlet, Toys R Us Express and Rockport. The acquisition of this property will enable the co-owners to begin to implement their outlet centre strategy immediately, as well as provide the flexibility to further develop, through expansion, the site into a full-scale Tanger Outlet Center.
RioCan and Tanger have also entered into a purchase and sale agreement to acquire approximately 50 acres of land in Kanata, Ontario, near Ottawa, to be developed as a Tanger Outlet Center. Subject to conditions, the co-owners are expected to acquire the land, which is located off of the TransCanada Highway (Highway 417) at Palladium Drive on a 50/50 basis.
The concept, design and merchandising of the Ottawa centre will be similar to those within the highly successful Tanger portfolio of outlet centres in the US. The site is located in the suburban Ottawa market of Kanata and will benefit from its access to the greater Ottawa market. When fully complete, the project will be home to approximately 350,000 square feet of branded factory outlet retailers from the U.S. and Canada offering consumers a unique opportunity to purchase merchandise directly from leading designer and brand name manufacturers at a substantial savings.
"We are very pleased to be able to jump start our co-ownership with Tanger and bring our collective expertise to a very well established, well located property and make it a key destination outlet shopping centre for Toronto and the surrounding area", said Edward Sonshine, President and CEO of RioCan. "Our site in Ottawa, represents an exciting opportunity to expand our co-ownership platform beyond Toronto, into other key Canadian retail markets."
"The acquisition of Cookstown Outlet Mall and its rebranding as the first Tanger Outlet Center north of the border accelerate our plans with RioCan for outlet center development in Canada," commented Steven Tanger, President and CEO of Tanger. "The addition of the site in the Ottawa market puts us well on the way to the establishment of a Canadian outlet shopping platform," he added.
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