Three of the centers are located in the greater Toronto area and the fourth is in Ottawa. Average occupancy of the properties is 97%.
The sellers are Canadian pension funds. As part of the purchase price, each of the sellers has agreed to accept the company's common stock. At an issuance price of $36.25, that portion of the transaction totals $36.3 million for all four properties.
GMAC Commercial Mortgage will be providing the company fixed rate, long-term, non-recourse financing for the acquisition. PenEquity will be retained as property manager for each of the centers. PenEquity also will be working with Entertainment Properties to add 230,000 sf of lettable space to the properties.
Entertainment Properties spokesman Jon Weis did not return phone calls seeking further comment. The company's strategy is to purchase real estate leased to operators of destination based entertainment and entertainment related properties under long-term, triple-net leases. According to SEC filings, most of Entertainment Properties' eggs are in the AMC basket; AMC leases 68% of the theater rental properties held by the company and accounts for 72% of the company's revenue.
As of Sept. 30, 2003, Entertainment Properties had invested approximately $818 million in 41 multi-screen movie theater properties, 31 restaurant/retail properties and one recreational waterpark. The company's share price on Wednesday fell $0.98 (2.77%) to $34.35 on twice the normal volume of trading. The company's 52-week high share price is $35.52.
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