BASE SHELF PROSPECTUS IS ACCESSIBLE, AND PROSPECTUS SUPPLEMENT WILL BE ACCESSIBLE WITHIN TWO BUSINESS DAYS, ON SEDAR+ NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR DISSEMINATION IN THE UNITED STATES MISSISSAUGA, Ontario, June 20, 2024 (GLOBE NEWSWIRE) -- Chartwell Retirement Residences ("Chartwell" or the "Trust") (TSX:CSH) announces that it has entered into definitive agreements for the strategic acquisition of two seniors housing portfolios in Quebec from separate vendors for an aggregate purchase price of $511 million (the "Portfolio Acquisitions"), consisting of: a 100% ownership interest in a portfolio of five high quality, modern retirement residences with 1,428 suites, located in the Greater Montreal area (the "GMA"), Gatineau, and Sherbrooke (the "GMA Portfolio") for $297 million; and a 50% ownership interest in a portfolio of five high quality, modern retirement residences with 1,805 suites located in the Quebec City area and Shawinigan (the "Quebec City Portfolio") for $214 million In addition to the Portfolio Acquisitions, Chartwell recently closed its acquisition of an 85% ownership interest in two modern, high quality residences with 685 suites from EMD-Batimo for $166 million: Chartwell Le Prescott and Chartwell Trait-Carré (the "Batimo Acquisitions"). On a combined basis, the Portfolio Acquisitions and the Batimo Acquisitions (collectively, the "Acquired Properties") are expected to result in Chartwell acquiring 12 properties representing 3,918 suites with an average age of five years and current occupancy of 95% (excluding two assets in lease-up)1. The total purchase price for the Acquired Properties, in aggregate, is $677 million. Chartwell is also in late-stage negotiations to acquire an 85% ownership interest in a retirement residence with 368 suites in Quebec from EMD-Batimo. Chartwell expects the price of the acquisition, if completed, to be approximately $86 million including the assumption of existing mortgages of $58 million. Concurrently with the Portfolio Acquisitions, Chartwell announces a $300 million bought deal offering (the "Offering") of units of the Trust ("Trust Units"), the net proceeds of which are expected to be used to partially fund the cash portion of the purchase prices for the GMA Portfolio and the Quebec City Portfolio, as further outlined below. GMA Portfolio The GMA Portfolio comprises five residences with 1,428 suites, of which three properties (55% of total suites) are located in the GMA, one property (23% of total suites) is located in Sherbrooke, and one property (21% of total suites) is located in Gatineau. The GMA Portfolio has a weighted average age of six years, with 105 seniors apartments ("SA"), 1,199 apartments offering independent supportive living services ("ISLA") and 124 suites offering assisted living services ("AL suites"). The current occupancy of the GMA Portfolio is 95%. Chartwell has agreed to purchase a 100% ownership interest in the GMA Portfolio for total consideration of $297 million. All properties offer residents a high quality living environment with upscale finishes, extensive and elegant amenity offerings, such as restaurants, theatres, multi-purpose rooms, libraries, swimming pools, exercise facilities and spas, and are well located in vibrant communities. The GMA Portfolio has over five acres of total excess land with the potential for development of over 580 units, across four properties. The GMA Portfolio is being acquired free-and-clear of debt. Quebec City Portfolio The Quebec City Portfolio comprises five residences with 1,805 suites of which four properties (82% of total suites) are located in the Quebec City area and one property (18% of total suites) is located in Shawinigan. The Quebec City Portfolio has a weighted average age of five years, with 181 SA, 1,428 ISLA and 196 AL suites. The current occupancy of the Quebec City Portfolio is 82%. Excluding two assets in lease up, the current occupancy of the Quebec City Portfolio is 94%. Chartwell will acquire a 50% ownership interest in the Quebec City Portfolio for total consideration of $214 million and will also assume management responsibilities. Chartwell expects to earn approximately $1.7 million in annual management fees from its joint-venture partner on a stabilized basis. The vendor has agreed to provide Chartwell with a 2-year net operating income ("NOI") guarantee, with $4.7 million of the purchase price to be held in escrow to support the vendor's obligation. The Quebec City Portfolio comprises modern assets with high end finishes and amenity offerings, such as restaurants, theatres, multi-purpose rooms, libraries, swimming pools, exercise facilities and spas. Each property is well-located close to stores, public transit and other community offerings. Chartwell will be assuming the current in-place mortgage debt on the Quebec City Portfolio totaling approximately $154 million, being Chartwell's 50% share. Beginning on August 28, 2028, subject to a one-year extension at the vendor's option, Chartwell will have an option to purchase the remaining 50% ownership interest of the Quebec City Portfolio and the vendor will have an option to sell its remaining 50% ownership interest of the Quebec City Portfolio to Chartwell at the then fair market value. Batimo Acquisitions The Batimo Acquisitions comprise an 85% ownership interest in two modern, well-located retirement residences with 685 suites. One property (47% of total suites) is located in the GMA and one property (53% of total suites) is located in Quebec City. The Batimo Acquisitions have a weighted average age of five years, with 648 ISLA and 37 AL suites. The current occupancy of these residences is 96%. The aggregate purchase price for the 85% ownership interest in the Batimo Acquisitions was $166 million. The Batimo Acquisitions offer residents attractive amenities, high quality finishes and are located in vibrant communities in core Quebec cities. Chartwell assumed the current in-place mortgage debt on the portfolio totaling approximately $100 million, being Chartwell's 85% share. "These acquisitions of high quality, recently developed residences will positively contribute to the overall quality of Chartwell's portfolio and expand our presence in high-growth Quebec cities, particularly within the Greater Montreal and Quebec City areas. The Acquired Properties are complementary to our existing Quebec portfolio, which we expect will allow for operating and management synergies. The transactions are consistent with our investment strategy to grow in strong markets with newer, high-quality assets which we believe will be competitive for a long time," said Vlad Volodarski, Chief Executive Officer, Chartwell Retirement Residences. Benefits of the Acquired Properties The Acquired Properties are expected to enhance the quality of Chartwell's portfolio and fit strategically with Chartwell's growth objectives, increasing its presence in key cities in Quebec. The Acquired Properties are strategically located, with 76% concentration in the GMA and Quebec City area, two of Quebec's most sought-after and largest cities. Over 91% of total suites are apartments, with the majority offering independent supportive living services. 10 of the 12 Acquired Properties offer continuum of care with dedicated AL neighborhoods. Pro forma the Acquired Properties, Chartwell's weighted average portfolio age will decline by approximately three years. The Acquired Properties are expected to have lower capital expenditure requirements than Chartwell's existing portfolio. The purchase price per suite for the Acquired Properties of approximately $230,000 is estimated to be approximately 30% below current replacement costs. The Acquired Properties have historically experienced strong operating and financial performance. As of May 2024, occupancy for the Acquired Properties was 95% (excluding two lease-up properties in the Quebec City Portfolio)1. Chartwell expects the Acquired Properties to generate a stabilized operating margin of over 40%. Based on Chartwell's underwriting and financing considerations, including estimated NOI support payments, the Acquired Properties are expected to be accretive to adjusted funds from operations per unit in the first full year of ownership, while enhancing the quality of Chartwell's property portfolio. Acquisition Funding The Acquired Properties will be funded through a combination of proceeds from previously announced dispositions, the assumption of in-place debt, net proceeds from the Offering (in the case ...