Morguard Real Estate Investment Trust Advises of Discussions with Obsidian Energy

MISSISSAUGA, ON, Feb. 27, 2020 /CNW/ - Morguard Real Estate Investment Trust ("the Trust") (TSX: MRT.UN) today announced that it is in formal discussions with Obsidian Energy Ltd ("Obsidian") regarding a potential lease amendment for its Penn West Plaza tenancy.

Penn West Plaza is a 636,500 square foot Class A office complex, consisting of two towers, located at 207 and 215 9th Avenue, Calgary, Alberta. Both office towers are fully leased to Obsidian Energy Ltd. until January 2025.

The Trust has been advised that as a condition of amending and extending the Obsidian syndicated credit facility, due February 28, 2020, the Trust and Obsidian execute an agreement that would reduce the net rent payable by Obsidian and have the Trust indemnify Obsidian in respect of existing subleases. The Trust estimates the potential impact to net operating income could be $7 million annualized for each remaining year of the lease term.  The parties expect to resolve and settle the discussions on or before March 4, 2020.

Forward-Looking Disclaimer

Statements contained herein that are not based on historical or current fact, including without limitation, statements containing the words "anticipate", "believe", "may", "continue", "estimate", "expects", "will" and words of similar expression, constitute "forward-looking statements". Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions, both nationally and in the regions in which the Trust operates; changes in business strategy or development/acquisition plans; environmental exposures; financing risk; existing governmental regulations and changes in, or the failure to comply with, governmental regulations; liability and other claims asserted against the Trust; and other factors referred to in the Trust's filings with Canadian securities regulators. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The Trust does not assume the obligation to update or revise any forward-looking statements. 

About Morguard Real Estate Investment Trust

The Trust is a closed-end real estate investment trust, which owns a diversified portfolio of 48 retail, office and industrial income producing properties in Canada, comprising approximately 8.5 million square feet of leasable space, with a value of $2.9 billion.

SOURCE Morguard Real Estate Investment Trust