TORONTO, Feb. 27 /CNW/ - Residential Equities Real Estate Investment Trust ("ResREIT") (TSX - REE.UN), Canada's urban apartment REIT, today announced that it completed the internalization of its property management function including leasing, physical property management, resident relations and site staff for all but four of its properties. Greenwin Property Management Inc. ("Greenwin"), the previous manager, will continue to provide accounting and administrative services to ResREIT under a new agreement, as well as comprehensive property management services on the remaining four properties.
Greenwin received a $1.8 million fee to terminate the existing property management contract one year earlier than otherwise contemplated and will continue to provide back-office services to ResREIT at a reduced annual fee of 1.3% of gross receipts for a five-year period. The new agreement is cancellable by ResREIT after November 30, 2004 with 90 days' written notice, at no cost to ResREIT. The new agreement is terminable by Greenwin after November 30, 2004 with 120 days' written notice, at no cost to ResREIT. Each party may also terminate the agreement in certain circumstances, including upon a change of control of ResREIT before November 30, 2004. In that case, either party may terminate the agreement, upon 60 days' written notice, with a termination fee being payable by ResREIT in an amount equal to approximately $600,000 initially, but diminishing over time.
As part of this transaction, the existing strategic alliance and non-competition agreements among ResREIT, Greenwin and certain related entities and senior officers of Greenwin were also terminated.
ResREIT is one of Canada's largest residential real estate investment trusts offering investors stable returns through tax-efficient monthly distributions and the inherent growth potential of Canada's urban apartment market. ResREIT controls 100% of its portfolio comprised of 10,890 residential suites located in five major Canadian cities. To learn more about ResREIT, refer to www.resreit.com; for detailed information on ResREIT's portfolio of properties, refer to www.resrent.com.
/For further information: Dino Chiesa, Chief Executive Officer, (416) 869-3003, ext. 222, e-mail: dchiesa(at)resreit.com; Maurice Kagan, Chief Financial Officer, (416) 869-3003, ext. 224, e-mail: mauricekagan(at)resreit.com./
© CNW Group
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