Winnipeg Free Press
Friday April 22 2005
By Martin Cash
WINNIPEG-based Huntingdon Real Estate Investment Trust (REIT) has purchased its sixth building in less than two months.
The REIT controlled by Winnipeg businessman Arni Thorsteinson agreed to acquire two office/warehouse buildings totalling 43,364 square feet at 119 and 130 Plymouth St. in the Inkster Industrial Park.
Both buildings are occupied by White-Wood Distributors Ltd., a distributor of specialty building products.
Huntingdon REIT has agreed to pay $2 million for the buildings in what is a related-party transaction. The two buildings are currently owned by a numbered company controlled by Thorsteinson. That company acquired them in December 2004 and January 2005.
Gino Romagnoli, an official with Huntingdon REIT, said the numbered company's acquisition of the buildings was done to ensure that Huntingdon would be able to buy them after it had completed all of its financing and regulatory closing prior to its public listing. Those details were completed in February of this year.
The Thorsteinson numbered company paid $2 million for the buildings, and sold them to Huntingdon for the same price. The independent trustees of the REIT approved the transaction and Thorsteinson abstained from voting on the resolution that approved it. The deal is similar to the company's acquisition in early March of the Fort Garry Brewing Co. building. Company officials say the buildings are "warehoused" until Huntingdon is able to purchase them.
Although it is a related-party transaction, it is exempt from the formal valuation and minority security holder approval requirements because it represents only about five per cent of Huntingdon's market capitalization.
The TSX Venture Exchange would call for more approvals if the deal represented more than 25 per cent of the market capitalization.
Huntingdon's shares closed yesterday unchanged at $2.55.
martin.cash@freepress.mb.ca