CAPREIT has entered into an agreement to sell its Canadian manufactured home community (MHC) portfolio to TPG Real Estate for a gross purchase price of $740 million. The portfolio includes 12,138 residential lots spread across 75 community sites located throughout Canada.

“We look forward to a smooth and successful transition with TPG Real Estate,” declared Mark Kenney, President and Chief Executive Officer of CAPREIT. “TPG Real Estate has advised CAPREIT that, as a longstanding investor in the Canadian real estate sector, it intends to partner with the existing team to manage and grow the MHC portfolio going forward.”

CAPREIT intends to use the net sale proceeds of its MHC portfolio for the repayment of the balance outstanding on its Canadian revolving credit facility and future acquisitions of on-strategy rental properties. Remaining funds will be used for general business purposes, which may include capital expenditures, debt repayment and the repurchase of trust units under its normal course issuer bid.

“We intend to use the net proceeds from this strategic sale to strengthen our balance sheet, enhance our liquidity and further fuel our high-grading capital allocation strategy,” added Julian Schonfeldt, Chief Investment Officer of CAPREIT. “This pivotal transaction is not only providing CAPREIT with a significant amount of capital, but it also increases management’s focus as a pure play apartment REIT. We’re excited to be simplifying our story and dedicating our resources to our core business, where our competitive advantages are strongest.”

The transaction is subject to compliance with the Competition Act (Canada) and other closing conditions customary in transactions of this nature. Subject to the receipt of all regulatory approvals and satisfaction of customary closing conditions, closing is anticipated in the fourth quarter of 2024.