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CAPITAL STRUCTURE
-- New equity issue helps increase market capitalization to $673.6 million - On March 6, 2013, the Trust completed a public offering of 10,465,000 Units issued at a price of $11.00 per unit for gross proceeds of $115.1 million. Since completing its Initial Public Offering in October 2012, the Trust has completed two equity offerings, each at successively higher prices, increasing the public float by approximately 130% and, together with higher trading prices, resulting in an 85% increase in total market capitalization.-- Strengthened capital structure through debt financings - During the quarter, the Trust secured $50.0 million in 7-year mortgage financing at a fixed face interest rate of 3.68% and $48.6 million in 10-year mortgage financing at 3.95%. The proceeds of these financings were used to repay $42.0 million in promissory notes due to Dundee REIT, as well as the $32.5 million variable rate bridge loan used to partially fund the KingSett Portfolio acquisition and $10.0 million drawn on its revolving credit facility. As a result, the Trust has eliminated its variable rate debt, lowered is effective interest rate and lengthened its term to maturity.
Key performance indicators(2) March 31, 2013 December 31, 2012----------------------------------------------------------------------------Level of debt (debt-to-gross book value)(3) 50.1% 54.3%Interest coverage ratio(4) 2.7 times 3.0 timesAverage face interest rate 4.25% 4.19%Debt - average term to maturity (years) 5.0 4.1----------------------------------------------------------------------------See footnotes on page 4
Subsequent to completing the CanFirst Portfolio acquisition and the acquisition of C2C Industrial Properties, the Trust's debt ratio will return to approximately 54%.
ACQUISITION ACTIVITY
The Trust continues to pursue strategic acquisitions. During the quarter, the Trust sourced and conducted due diligence on a portfolio of 22 properties comprising 1.6 million square feet of gross leasable area in key industrial nodes and situated along major transportation corridors in the Greater Toronto Area (the "CanFirst Portfolio"). The CanFirst Portfolio complements the REIT's existing assets in terms of asset type and quality, as well as other key portfolio metrics. The Portfolio has a current in-place occupancy rate of 96%, a weighted average lease term of approximately 3.7 years and an average in-place rent of $5.83 per square foot. The acquisition was completed subsequent to quarter-end, on April 24, 2013, for a total purchase price of approximately $(151.5) million.
In addition, on March 19, 2013, the Trust announced that it had entered into a support agreement pursuant to which it had agreed to make an offer to acquire all of the issued and outstanding shares of C2C Industrial Properties Inc. ("C2C") in exchange for units of Dundee Industrial REIT. The C2C portfolio comprises 25 properties totalling 2.5 million square feet of gross leasable area located primarily in Halifax, Edmonton, Greater Toronto Area and Greater Montreal Area, and complements the Trust's existing assets in terms of asset type and quality, as well as other key portfolio metrics. The portfolio has a current occupancy rate of 96%, a weighted average lease term of approximately 3.7 years and an average in-place rent of $5.65 per square foot. The take-over bid circular and the offer to acquire the outstanding shares of C2C was mailed to C2C shareholders on April 5, 2013 and expires on May 11, 2013.
