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Dundee Industrial REIT to Acquire Industrial Portfolio for $151.5 Million

Dundee Industrial REIT to Acquire Industrial Portfolio for $151.5 Million 
TORONTO, ONTARIO -- (Marketwired) -- 04/11/13 -- DUNDEE INDUSTRIAL
REIT (TSX:DIR.UN) today announced that it has entered into an
agreement with CanFirst Industrial Realty Fund III LP and CanFirst
Industrial Realty Fund IV LP ("CanFirst") to acquire a portfolio of
22 industrial properties (the "Portfolio") for approximately $151.5
million.  
The CanFirst Portfolio comprises 1.6 million square feet of gross
leaseable area wholly located across the Greater Toronto Area ("GTA")
in key industrial markets and along major transportation corridors
providing direct highway access.  
Highlights: 


 
--  Further solidifies Dundee Industrial as market leader - Upon completion
    of the acquisition of the Portfolio and the recently announced
    acquisition of C2C Industrial Properties Inc. ("C2C"), Dundee Industrial
    will own a nationally diversified portfolio totalling 15.6 million
    square feet of gross leasable area, reinforcing its position as Canada's
    largest industrial REIT. 
--  Broadens Dundee Industrial's exposure in the GTA - The Portfolio
    comprises 1.6 million square feet of gross leaseable area located
    entirely within the GTA. The Portfolio will provide additional scale in
    the GTA and further enhances the REIT's geographic and tenant
    diversification. 
--  Immediately accretive - The transaction is immediately accretive to the
    REIT. The Portfolio has a year-one capitalization rate of 6.5%.
    Including property management fee income, the capitalization rate
    increases to 6.7%.

 
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. 


 
            ----------------------------------------------------------------
                                                                  Geographic
                          Gross leasable area (sq. ft.)  distribution of NOI
            ----------------------------------------------------------------
                                                                   Pro forma
               Current        C2C   CanFirst        Pro    Current     C2C &
             Portfolio  Portfolio  Portfolio      forma  Portfolio  CanFirst
----------------------------------------------------------------------------
Atlantic                                                                    
 Canada      2,191,503    619,876          -  2,811,379        18%       19%
Quebec       3,204,516    528,508          -  3,733,024        24%       20%
Ontario      1,917,401  1,211,822  1,625,814  4,755,037        15%       27%
Saskatchewan   829,815          -          -    829,815         7%        5%
Alberta      3,277,555    168,251          -  3,445,806        35%       28%
British                                                                     
 Columbia       17,405          -          -     17,405         1%        1%
----------------------------------------------------------------------------
Total       11,438,195  2,528,457  1,625,814 15,592,466       100%      100%
----------------------------------------------------------------------------

 
The pro forma impact of the acquisition on Dundee Industrial REIT's
key portfolio metrics is detailed below:  


 
----------------------------------------------------------------------------
                                  Current        Pro forma        Pro forma 
Portfolio                       portfolio    C2C Portfolio   C2C & CanFirst 
----------------------------------------------------------------------------
Gross leasable area                                                         
 (square feet)               11.4 million     14.0 million     15.6 million 
Number of properties                  158              183              205 
Average remaining lease                                                     
 term (years)                         5.4              5.1              5.0 
Average in-place rent                                                       
 (per square foot)                  $7.12            $6.86            $6.75 
Average market rent (per                                                    
 square foot)                       $7.57            $7.29            $7.15 
Average tenant size                                                         
 (square feet)                     11,850           11,987           12,077 
Number of tenants                     910            1,120            1,240 
NOI by Multi-tenant /                                                       
 Single-tenant                   62% / 38%        67% / 33%        66% / 34%
Occupancy rate (%)                     96%              96%              96%
----------------------------------------------------------------------------

 
Dundee Industrial will acquire the Portfolio for a purchase price of
approximately $151.5 million, equating to a value of approximately
$93/square foot. Year 1 NOI is expected to be $9.9 million, resulting
in a capitalization rate of 6.5%. Including property management
income, the capitalization rate increases to 6.7%.  
The acquisition will be financed with: 


 
--  $93.5 million in cash from the Equity Issue that closed last March 6; 
--  The assumption of $61.7 million existing mortgage debt, with an average
    term of 1.9 years. The effective interest rate on the assumed debt is
    3.1% after giving effect to the vendor's buy down of existing rates.

 
Subsequent to both the CanFirst and C2C acquisition, the REIT will
have approximately $15 million of cash on hand, an undrawn operating
facility of $50 million and operate at a debt level of 54% (45%
excluding convertible debentures).  
The acquisition is subject to certain closing conditions typical for
transactions of this type, including lender consents. The acquisition
is scheduled to close by the end of April.  
Dundee Industrial REIT is an unincorporated, open-ended real estate
investment trust. Dundee Industrial REIT owns a portfolio of 158
primarily light industrial properties comprising approximately 11.4
million square feet of gross leasable area in key industrial markets
across Canada. Its objective is to build upon and grow its portfolio
and to provide stable, sustainable and growing distributions to its
unitholders. For more information, please visit
www.dundeeindustrial.com.  
This press release contains forward-looking statements with respect
to Dundee Industrial and its operations, strategy, financial
performance and financial condition, as well as with respect to the
acquisition of the Portfolio. These statements generally can be
identified by the use of forward-looking words such as "forecast",
"may", "will", "expect", "estimate", "anticipate", "intend",
"believe" or "continue" or the negative thereof or similar
variations. The actual results and performance of Dundee Industrial
and the Portfolio discussed herein could differ materially from those
expressed or implied by such statements. See the risk factors in the
public filings of Dundee Industrial REIT. Such statements are
qualified in their entirety by the inherent risks and uncertainties
surrounding future expectations. Some important factors that could
cause actual results to differ materially from expectations include,
among other things, general economic and market factors, competition,
the failure to receive any required approvals or consents in
connection with the acquisition of the Portfolio or the failure to
satisfy or waive any other condition to the acquisition of the
Portfolio, the failure of Dundee Industrial REIT to realize expected
benefits from the acquisition of the Portfolio, the performance of
the Portfolio generally, changes in securities or other laws or
regulations or the application thereof. The cautionary statements
qualify all forward-looking statements attributable to Dundee
Industrial and persons acting on its behalf. The assumptions made in
making forward-looking statements are referred to in the public
filings of Dundee Industrial REIT. Unless otherwise stated, all
forward-looking statements speak only as of the date of this press
release. Except as required by applicable law, Dundee Industrial
specifically disclaims any obligation to update or revise any
forward-looking statements, whether as a result of new information,
future developments or otherwise. 
Contacts:
Dundee Industrial REIT
Michael Cooper
Chairman, Executive Committee
(416) 365-5145
mcooper@dundeeindustrial.com 
Dundee Industrial REIT
Randy Cameron
Interim President & Chief Executive Officer
(403) 270-2480
rcameron@dundeeindustrial.com 
Dundee Industrial REIT
Mario Barrafato
Chief Financial Officer
(416) 365-4132
mbarrafato@dundeeindustrial.com