Homburg Invest Inc. has announced that the Company intends to proceed with the purchase of four large commercial properties in The Netherlands in the first quarter of 2006, subject to the finalization of its due diligence, but will not proceed with the German residential portfolio acquisition. The original agreement in principle on all of this portfolio was first announced on June 23, 2005 and closing on this transaction was expected to take place on November 15, 2005.
The four commercial properties include the KPN Telecom Head Office in Groningen, the Phillips Lighting Headquarters and Research facilities in Eindhoven and two David Lloyd facilities in Rotterdam. All four properties are leased by world class, triple A public companies on a long -term lease basis. The aggregate cost to Homburg Invest for these properties will amount to approximately CAD $196 million (140 million) and will be financed by assumption of existing debt of CAD $147 million (105 million), and shares
of Homburg Invest (subject to TSX approval) and cash totalling CAD $49 million (35 million).
The residential portfolio consisting of approximately 8,500 units in the former West Berlin and in the Northrijn and Westfalen areas of Germany will not proceed as they did not meet our standards and the expected operating results from the residential portfolio did not achieve our financial objectives. As the company's philosophy has always been that we will not complete transactions for the sake of growth alone, all acquisitions must be accretive over the long term to sha reholders and add value to our earnings per share. In the end, the Company has determined that this residential portfolio does not meet this goal.
Source: Homburg
