HomeKillam enters two new markets

Killam enters two new markets

Feb 27 2004

Halifax - Continuing its strategy of consolidating the rental apartment sector in Atlantic Canada and adjacent markets, Killam Properties Inc. (TSX: KMP) is very pleased to announce its entry into the Fredericton, New Brunswick and Charlottetown, Prince Edward Island markets. The company has acquired 51 residential rental units in Charlottetown, Prince Edward Island, and 54-units in Fredericton, New Brunswick. Killam now owns 2,172 apartment/manufactured home units in Nova Scotia, New Brunswick, Newfoundland, and Prince Edward Island - a significant increase from the 311 units owned at this time last year.

The purchase price of $2,175,000 ($42,647 per unit) for 64 Belvedere Avenue, in Charlottetown, Prince Edward Island was satisfied by a vendor take-back mortgage of $200,000, with the balance in cash. The Belvedere Avenue property contains one bachelor unit, 46 one-bedroom units, and 4 two-bedroom units with an average one-bedroom apartment rent of $490 per month. The property is a well maintained adult building located close to all amenities. According to the 2003 Canadian Mortgage and Housing Corporation Rental report for Charlottetown, the average monthly rent in the area is $469 for a one-bedroom and $595 for a two bedroom with the overall vacancy for Charlottetown being 3.5%.

“I am very excited about Killam’s entry into the Charlottetown residential marketplace, and we are currently looking for more quality buildings to buy”, stated Tim Banks, a resident of Charlottetown and a Director of Killam Properties Inc. since inception. “Killam is a solid and well-managed company and I think the move into Charlottetown is a good sign for the residential market in Prince Edward Island. This kind of investment is good for business and for the community”, Tim Banks concluded.

The purchase price of $3,100,000 ($57,407 per unit) for Venus Apartments, Fredericton, New Brunswick was satisfied with cash. This project contains a very favourable suite mix of nine one-bedroom units, 18 two-bedroom units, and 27 three bedroom units, with an average rent of $715 for each two-bedroom unit. According to the 2003 Canadian Mortgage and Housing Corporation Rental Report for Fredericton, the average monthly rent in the area is $669 for a two-bedroom unit and $824 for a three bedroom unit with the overall vacancy for Fredericton being 1.6%.

Killam intends to place new first mortgages on these properties within the next month at an interest rate expected to be in the range of 5.00% to 5.20% per annum. Accordingly, both acquisitions will be highly accretive to Killam’s financial performance.

Killam continues to actively investigate additional acquisitions on similarly accretive terms as it consolidates the rental apartment market in Canada.

Killam is a publicly-traded real estate company and is focused on the acquisition, redevelopment, and management of multi-family residential rental properties and manufactured home communities in Atlantic Canada and adjacent markets.


Killam Properties Inc.
Philip Fraser, President and CEO Robert Richardson, CA, EVP & CFO
Phone: (902) 453-4536 Phone: (902) 442-9001
Fax: (902) 455-4525 Fax: (902) 455-4525


Note: The Toronto Stock Exchange has neither approved or disapproved of the information contained herein. Certain statements in this report may constitute forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors which may cause actual results, performance or achievements of Killam to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Killam does not undertake to update any of such forward-looking statements.

Media Contact: MediaReleases@apm.ca