Morguard REIT Announces Completion of Previously Announced Public Offering of $150 Million of Convertible Debentures

/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES./

MISSISSAUGA, ON, Dec. 7, 2021 /CNW/ - Morguard Real Estate Investment Trust ("Morguard REIT" or the "REIT") (TSX: MRT.UN), announced today that it has completed its previously announced public offering (the "Offering"), on a bought deal basis, of $150 million aggregate principal amount of 5.25% convertible unsecured subordinated debentures due December 31, 2026 (the "Debentures"). The Debentures are convertible, at the option of the holder, into trust units of Morguard REIT (the "Units") at $7.80 per Unit. The Offering was underwritten by a syndicate of underwriters co-led by RBC Capital Markets, TD Securities Inc. and Scotiabank, with RBC Capital Markets and TD Securities Inc. acting as bookrunners. As part of the transaction, Morguard Corporation ("Morguard") purchased $60 million aggregate principal amount of the Debentures.

The REIT intends to use the net proceeds from the Offering, together with existing liquidity, to fund the redemption on December 17, 2021 (the "Redemption") of all of the REIT's 4.50% convertible unsecured subordinated debentures (current outstanding principal balance of approximately $175.0 million) (the "2016 Debentures").

Copies of the REIT's short form prospectus are available on SEDAR at www.sedar.com.

The Units and the Debentures have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered, sold or delivered, directly or indirectly, in the United States or to, or for the account or benefit of, "U.S. persons" (as defined in Regulation S under the United States Securities Act of 1933, as amended). This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States or to, or for the account or benefit of, U.S. Persons.

Early Warning Disclosure

Prior to the Offering, Morguard (together with Paros Enterprises Limited ("Paros") and K. Rai Sahi) owned 44,178,244 Units (including Units issuable upon conversion of the 2016 Debentures held by Morguard), representing 68.86% of the outstanding Units. After completion of the Offering, and assuming full conversion of Morguard's Debentures from the Offering, Morguard acquired ownership of an additional 7,692,306 Units, representing approximately 11.99% of the outstanding Units, calculated on a partially diluted basis. As a result, following the Offering, Morguard (together with Paros and K. Rai Sahi) owns 51,870,550 Units (including Units issuable upon conversion of the Debentures and the 2016 Debentures held by Morguard only), representing 80.85% of the outstanding Units (76.27% of the outstanding Units after giving effect to the recently announced Redemption).

Morguard acquired the Debentures for investment purposes. Morguard and its affiliates may, from time to time, depending on market and other conditions or relevant factors, increase or decrease its beneficial ownership, control or direction over securities of the REIT through market transactions, private agreements or otherwise.

This press release is being issued pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issuers which requires a report to be filed under the REIT's profile on SEDAR (www.sedar.com) containing additional information respecting the foregoing matters. A copy of such report may be obtained by contacting Beverley Flynn at Morguard Corporation, 55 City Centre Drive, Suite 1000, Mississauga, Ontario L5B 1M3, Tel: 905-281-3800.

About Morguard REIT

Morguard REIT is a closed-end real estate investment trust, which owns a diversified portfolio of 46 high quality retail, office and industrial income producing properties in Canada with a book value of $2.5 billion and consisting of approximately 8.3 million square feet of leasable space.

Certain information in this press release may constitute forward-looking statements that involve a number of risks and uncertainties, including statements regarding the outlook for the REIT's business results of operations, proposed use of proceeds from the Offering (including any redemption) and the timing thereof. Forward-looking statements use the words "believe", "expect", "anticipate", "may", "should", "intend", "estimate" and other similar terms, which do not relate to historical matters. Such forward-looking statements involve known and unknown risks and uncertainties and other factors that may cause the actual results to differ materially from those indicated. Such factors include, but are not limited to, general economic conditions, the availability of new competitive supply of commercial real estate that may become available either through construction or sublease, the REIT's ability to maintain occupancy and to lease or re-lease space on a timely basis at current or anticipated rates, tenant bankruptcies, financial difficulties and defaults, changes in interest rates, changes in operating costs, the REIT's ability to obtain adequate insurance coverage at a reasonable cost, the ability to complete potential acquisitions and the availability of financing. The REIT believes that the expectations reflected in forward-looking statements are based on reasonable assumptions; however, the REIT can give no assurance that actual results will be consistent with these forward-looking statements. Except as required by applicable law, the REIT disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Readers should be cautioned not to place undue reliance on the forward-looking statements.

SOURCE Morguard Real Estate Investment Trust