Mr. Robert McKee reports

FIRM CAPITAL PROPERTY TRUST ANNOUNCES THE SALE OF ITS 50% INTEREST IN A 159,470 SQUARE FOOT INDUSTRIAL BUILDING LOCATED IN MONTREAL FOR $27.9 MILLION

Firm Capital Property Trust's Montreal industrial portfolio joint venture has entered into a binding agreement to sell a 100-per-cent interest in a single-tenant, 159,470-square-foot industrial facility for gross proceeds of approximately $27.9-million ($27.5-million net of closing costs). The trust's portion of the gross proceeds after closing costs are approximately $13.8-million. Closing is anticipated to be during the second quarter of 2025.

Property details

The property has been owned by the trust in the 50/50 Montreal industrial JV since 2018 and was originally purchased for $11.0-million (at 100-per-cent ownership). The property is currently carried on the trust's balance sheet at an international financial reporting standard value of approximately $12.5-million for its 50-per-cent interest. The trust's property manager was in the process of re-leasing the property after the previous tenant declared bankruptcy last year. The sale reduces the trust's exposure to large tenants and allows the trust to reinvest capital into smaller bay multitenant industrial units.

The trust anticipates using its portion of the net proceeds (net of any associated mortgage repayment) to repay debt on the revolving credit facility and, then, to finance future acquisitions in the following sectors: (i) grocery-anchored retail; (ii) multitenant industrial; and (iii) multiresidential rentals, that are less exposed to the impact of U.S. tariffs.

Based on the original purchase price, the Montreal industrial JV will have generated a gain on sale of approximately $16.0-million ($8.0-million for the trust at its 50-per-cent ownership). As such, the trust expects the sale to increase the capital gain portion of its 2025 distribution by approximately 18 cents per trust unit compared with a total of eight cents per trust unit in 2024.

About Firm Capital Property Trust

Firm Capital Property is focused on creating long-term value for unitholders through capital preservation and disciplined investing to achieve stable distributable income in partnership with management and industry leaders. The trust's plan is to own as well as to co-own a diversified property portfolio of multiresidential, flex industrial and net lease convenience retail. In addition to stand-alone accretive acquisitions, the trust will make joint acquisitions with strong financial partners and acquisitions of partial interests from existing ownership groups in a manner that provides liquidity to those selling owners and professional management for those remaining as partners. Firm Capital Realty Partners Inc., through a structure focused on an alignment of interests with the trust, sources, syndicates, and property and asset manages investments on behalf of the trust.

We seek Safe Harbor.