Announcement of Intention to Float

Friday 04 April, 2014

Irish Rdn prop REIT

Announcement of Intention to Float

RNS Number : 0679E
Irish Residentl Properties REIT PLC
04 April 2014

 

Irish Residential Properties REIT plc
Announcement of Intention to Float
Irish Residential Properties REIT PLC
4 April 2014

This announcement is not an offer of securities for sale in the United States or any other jurisdiction.  This announcement is an advertisement and not a prospectus (or prospectus equivalent document). Investors should not subscribe for or purchase any shares referred to in this announcement except solely on the basis of information in the prospectus (the "Prospectus") to be published by Irish Residential Properties REIT plc (the "Company") in due course in connection with the admission of all of the ordinary shares in the capital of the Company (the "Ordinary Shares") to the Official List of the Irish Stock Exchange and to trading on the regulated market for listed securities of the Irish Stock Exchange Limited (the "Irish Stock Exchange"). A copy of the Prospectus will, following publication, be made available for viewing at http://www.centralbank.ie/regulation/securities-markets/prospectus/Pages/approvedprospectus.aspx. This announcement is not an offer to sell, or a solicitation of an offer to acquire, securities to any person in the United States or in any other jurisdiction to whom or in which such offer or solicitation is unlawful. Neither this announcement nor any part of it shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract or commitment whatsoever.

 4 April 2014

IRISH RESIDENTIAL PROPERTIES REIT PLC

ANNOUNCES INTENTION TO FLOAT ON

THE IRISH STOCK EXCHANGE

Irish Residential Properties REIT plc, an Irish property investment company, today announces its intention to seek a primary listing for its Ordinary Shares on the Official List of the Irish Stock Exchange and admission to trading on the regulated market for listed securities of the Irish Stock Exchange ("Admission").

The Company commenced operations in September 2013 when it acquired multi-unit primarily residential rental properties in four locations in Dublin (the "Initial Properties"), for approximately €42.4 million, excluding acquisition costs.

The Company is seeking to raise gross proceeds of approximately €200 million pursuant to a placing of its Ordinary Shares with certain institutional and qualified professional investors in various jurisdictions and, in Ireland only, with institutional and qualified professional investors and/or private investors acting on the advice of their stockbroker or financial advisor as well as specialised international real estate investors (the "Placing"). CAPREIT Limited Partnership ("CAPREIT LP") will subscribe for up to 10% of the Placing through a trustee on behalf of an intermediary vehicle (of which CAPREIT LP is the sole beneficiary), (the "Subscription"). CAPREIT LP is a wholly owned subsidiary of Canadian Apartment Properties Real Estate Investment Trust ("CAPREIT"), an entity listed on the Toronto Stock Exchange ("TSX").

It is expected that Admission will become effective and dealings in the Ordinary Shares will commence on the Irish Stock Exchange at 8.00 am on 16 April 2014. On 31 March 2014, the Company elected to become an Irish Real Estate Investment Trust ("REIT").

HIGHLIGHTS

  • The Company has an initial portfolio consisting of the Initial Properties which comprise 338 residential units across four properties in the greater Dublin area that were acquired in September 2013. The Initial Properties have been valued by CBRE as at 31 December 2013 at €45.49 million.
  • The Company's focus is to acquire, hold and manage investments primarily focused on multi-unit residential real estate located in Ireland and Northern Ireland (the "Island of Ireland") and/or ancillary and strategically located commercial property, for third party rental, on the Island of Ireland (the "Focus Activity").
  • Within its Focus Activity, the Company intends to build and manage its property investments to provide stable, sustainable and growing cash flows for its shareholders (the "Shareholders") with a target total shareholder return of 10% to 15% per annum (pre-taxation) when fully invested and gearing is at or near the maximum permitted level, targeting a dividend yield of 4.5-5.00% per annum.[1]
  • It is intended that, subject to authorisation by the Central Bank of Ireland (the "Central Bank") as an AIFM (defined below), CR Fund Management Limited (the "Investment Manager") an indirect wholly owned subsidiary of CAPREIT will be the investment manager of the Company. CAPREIT is one of the largest residential rental REITs in Canada with over 41,200 units in Canada as at 31 December 2013 and was formed and listed on the TSX in 1997. As at 31 December 2013, it had a market capitalisation of C$2.4 billion.
  • The Company will have a management team, composed of its CEO, senior members of its Investment Manager and senior members of CAPREIT (the "Management Team") and board of directors of the Company (the "Board" or "Directors") that in aggregate have significant experience in assembling and managing real estate property portfolios and individually possess considerable knowledge within their respective fields.
  • The Investment Manager has appointed an Irish-based chief investment officer who has 20 years' experience operating in the Irish real estate sector and will be responsible for on-the-ground investment sourcing and identification of opportunities. (The chief investment officer will take up his position in approximately two months' time.)
  • The day-to-day administration and operational aspects of property and facilities management will be provided by the Investment Manager's team based in Dublin, which is expected to expand as the portfolio grows. The full extent of CAPREIT's institutional experience, knowledge and operational infrastructure, including its property management systems, will be available to the Company through a formal services agreement.
  • CAPREIT intends to closely align its interests with other shareholders through an indirect subscription for up to 10% of the Company which it will seek to maintain by participating in any subsequent share issuances subject to a maximum aggregate total cash investment of €40 million.
  • Improving economic conditions and demographic trends, a lack of significant historical institutional ownership in the residential property rental market and the potential for significant asset sales by banks, the National Asset Management Agency ("NAMA") and other sources combine to provide what the Board believes to be a significant opportunity to build a significant residential rental portfolio at attractive yields.
  • The Company intends to take a long term view in relation to holding and enhancing its assets and specifically looks to identify acquisition properties which require active management.
  • The Company has entered into an agreement with Franklin Templeton Institutional, LLC ("Franklin") to participate in the Subscription and Placing as a cornerstone investor. Conditional upon Admission occurring on or before 25 April 2014 and certain other conditions, Franklin, acting as investment manager on behalf of certain funds and accounts has made an irrevocable and unconditional application to the Company for, and the Company has agreed to issue and allot to, those funds and accounts Ordinary Shares to the value of €25,000,000, at the issue price specified in the Prospectus.

Commenting on today's announcement, Colm Ó Nualláin, chairman of Irish Residential Properties REIT plc. said: 

"The Board considers that the opportunity presented by the availability of favourable investment prospects in the Irish multi-unit residential sector in the context of the improving Irish economy, the wealth of experience and support available from CAPREIT in an investor friendly REIT structure is a compelling one, and we look forward to working with CAPREIT to maximise this opportunity."

David Ehrlich, CEO of Irish Residential Properties REIT plc, said:

"We are delighted to be launching Irish Residential Properties REIT plc which we believe will be the first Irish REIT investing primarily in multi-unit residential properties. We intend to continue building a strong Irish team backed by CAPREIT's extensive infrastructure and to develop a professionally managed long term apartment sector."

Company Overview

The Company is a property investment company which will seek to acquire, hold and manage investments primarily focused on multi-unit residential real estate on the Island of Ireland and/or ancillary and strategically located commercial property, for third party rental, on the Island of Ireland. The Company has identified an opportunity to service the increased demand for rented accommodation arising from the large number of highly skilled and transient members of the workforce employed by the large multinationals, the acceptance of long term renting as an alternative to home ownership, and the postponement of first-time purchases as a result of the low availability of mortgage finance in recent years. 

The Company has acquired the Initial Properties in Dublin at prices below current replacement costs and the Directors believe that there will be further opportunities to acquire additional properties at attractive yields. The Board intends to focus on properties which require active management and which are expected to benefit from the Management Team's expertise.

The Company may acquire indebtedness secured by properties (including in respect of buy-to-let properties), where it intends to gain title to and control over the underlying property. The company may acquire properties and portfolios which include a limited amount of other assets,provided there is a disposition plan in place in connection with such assets. The company may also acquire a limited amount of value enhancement opportunities through intensification, redevelopment or project completion.

The Company believes that it will benefit from the provisions of the Irish REIT legislation. Pursuant to the Irish REIT regime the Company will be required, amongst other things, subject to having sufficient distributable reserves, to distribute to Shareholders at least 85% of the property income of its property rental business for each accounting period. The Board's current intention is to maintain gearing near 50% (in accordance with the Irish REIT legislation) once the portion of the net proceeds from the Placing and Subscription intended to be used for investments is fully invested.

Investec Bank plc and TD Securities Inc. have been appointed as Joint Bookrunners in connection with the Placing. Investec Bank plc (acting through its Irish Branch) has been appointed as sole Sponsor in connection with the Admission to the Irish Stock Exchange.

FOR FURTHER DETAILS, CONTACT:

Investec Bank plc
+353 (0)1 421 0000

(Joint Bookrunner and sole Sponsor (acting through its Irish Branch))

Tommy Conway

Kevin Gallen

Alan Mahon

TD Securities Inc. (Joint Bookrunner)
+1 416 307 8500

Andrew Phillips

John Mishra

William Huynh

David Gilmour

Vincent Wall & Associates (PR Consultants)

Vincent Wall
+353 (0)87 686 0727

FURTHER INFORMATION

INVESTMENT HIGHLIGHTS

Investment policy

Key characteristics of target properties for acquisition or development

The Company will invest and manage its assets in a way consistent with its investment policy as will be outlined in the Prospectus. The Board intends that the portfolio of real estate assets to be acquired by the Company will normally have a majority of the following characteristics:

(a)        Multi-unit residential properties across the affordable, mid-tier and luxury accommodation sectors and ancillary and/or strategically located commercial property located in the greater Dublin area and other urban centres on the Island of Ireland;

(b)        Scope for short and medium-term value enhancement through active asset management;

(c)        Opportunities to enhance the quality of the property;

(d)        Opportunities to create tangible value by undertaking initiatives to develop a sense of community amongst tenants consistent with the Management Team's Canadian practices and expertise;

(e)        Properties that will contribute to a targeted gross rental yield of 8.6% to 10% (with a rate of return based (on the expected net rental income after deduction of the property-related expenses that a property will generate) of 6% to 7%) before gearing for the overall blended portfolio;

(f)         Properties which can be acquired close to (and ideally below) replacement cost;

(g)        Properties which have strong prospects of generating income in the short to medium term in order to support the Company's dividend policy (as will be outlined in the Prospectus);

(h)        Properties providing value enhancement opportunities through intensification, redevelopment or project completion, such properties to be held for the purposes of the Company's property rental business, where the Investment Manager believes that this can be effected on a basis that will add value to the Company's portfolio subject always to the aggregate costs to be incurred in respect of assets under development at any time will not exceed 15% of the Company's most recently published Net Asset Value; and

(i)         Properties in markets where there is strong and/or improving demand for multi-unit residential rental accommodation and ancillary and/or strategically located commercial property.

Material changes to the Company's investment policy may only be made by ordinary resolution of the Shareholders in accordance with the Listing Rules, which will also be notified to the market through a Regulatory Information Service. If the Company breaches its investment policy, the Company will make a notification via a Regulatory Information Service of details of the breach and of actions it may or may not have taken. All decisions in relation to the acquisition or disposition of property investments will be reserved to the Board. 

Initial Properties

  • The residential units in the Initial Properties comprise:

    o    83 units over four blocks at North King Street, Smithfield, Dublin 7;

    o    90 units over six blocks at Camac Crescent, Inchicore, Dublin 8;

    o    63 units at the Grande Central block, Rockbrook, Sandyford, Dublin 18; and

    o    102 units over three blocks at Priorsgate, Greenhills Road, Tallaght, Daublin 24. 

  • The Initial Properties were acquired at below current replacement cost. The Company acquired the Initial Properties for €42.4 million (excluding acquisition costs) in September 2013. 
  • Average occupancy at the Initial Properties improved from approximately 93% in July 2013 to 99.4% as at 31 December 2013.
  • The Initial Properties generated gross rental income of €1.31 million in the period between acquisition and 31 December 2013 and incurred operating expenses of €0.386 million giving a net operating income of €0.924 million.

Background on CAPREIT

CAPREIT is an internally-managed, unincorporated, open-ended real estate investment trust governed under the laws of the Province of Ontario, Canada.  CAPREIT's stockholder units are publicly traded and have been listed on the TSX under the symbol "CAR.UN" since 1997.  As at 31 December 2013, it had a market capitalisation of C$2.4 billion and had provided a total unitholder return of 633% since its IPO.

CAPREIT has grown its initial portfolio from 2,900 residential units located primarily in Ontario and Nova Scotia in May 1997 to over 41,200 units coast to coast in Canada as at 31 December 2013.  While continuing to grow its property portfolio, CAPREIT has maintained its focus on building a strong property and asset management platform to improve property-level returns and capitalise on site intensification, development and capital investment opportunities. CAPREIT has approximately 900 employees coast to coast in Canada. CAPREIT's executives provide in-house expertise in the key areas of acquisitions, legal, finance, accounting, human resources, procurement, energy management, marketing, information technology, major capital expenditures and repairs and maintenance.

Management Team's senior level experience of assembling and managing property portfolios

  • Highly experienced Management Team with significant individual knowledge across a number of fields and in the real estate sector generally.
  • The Investment Manager has appointed an Irish-based chief investment officer who has 20 years' experience operating in the Irish real estate sector and will be responsible for on-the-ground investment sourcing and identification of opportunities. (The chief investment officer will take up his position in approximately two months' time.)
  • Management from CAPREIT has successful track record in multi-unit residential sector in Canada as outlined above.
  • The full extent of CAPREIT's institutional experience, knowledge and operational infrastructure, including its property management systems, will be available to the Company through the services of the Investment Manager and the services provided under the Services Agreement.

Alignment of interests with CAPREIT and Management Team

  • Investment by CAPREIT LP for up to 10% of the Company subject to 2-year lock-in arrangement from Admission (subject to certain customary exceptions and to the Investment Management Agreement (defined below) not having terminated).
  • Ability to participate in subsequent offerings up to total investment (including the Subscription) of €40 million.
  • Long Term Incentive Plan established in order to retain and incentivise certain personnel of the Company, the Investment Manager and CAPREIT LP.

Strengthening economic fundamentals in Ireland

  • Irish GNP rose by 1.8% year on year in 2012 and by a further 3.4% year on year in 2013 (Source: Central Statistics Office in Ireland ("CSO")).  The most recent forecasts of the Central Bank indicate it will expand for a third successive year in 2014 (Source: Central Bank Quarterly Bulletin, January 2014).
  • The unemployment rate has improved from a peak of 15.1% in February 2012 to 12.3% in January 2014 (Source: Central Bank Quarterly Bulletin, January 2014).
  • The competitiveness of the Irish economy has improved in recent years, as reflected in a cumulative 12% fall in unit labour costs across the Irish economy in the 2009 to Autumn 2013 period (Source: 'Forecasts from Europa.eu' Autumn 2013).
  • In November 2010, the Irish Government agreed to the EU/IMF Programme, an €85 billion programme of financial support, which Ireland exited without further supports, on schedule in December 2013.

Capitalise on Irish rental trends and the Irish residential property market recovery

  • The number of households renting accommodation in Ireland increased by 47% between 2006 and 2011 (Source: CSO Report 'The Roof over our Heads' August 2012).
  • The national population is projected to grow by between 0.3% and 0.6% per annum from 2011 to 2031 (Source: CSO).
  • The greater Dublin area population is projected to grow by between 0.5% per annum to 1% per annum from 2011 to 2031 (Source: CSO).
  • From its peak in February 2007, the national index of apartment prices fell 63% before stabilising in November 2012; prices have since recovered by 25% in Dublin and 17% nationally (Source: CSO Residential Property Price Index, December 2013).
  • Private sector rent levels in Dublin have been steadily increasing from the recent low in 2011. Data compiled by an Irish property website, Daft.ie, show that the asking rents nationally were 7.1% higher on average in the final quarter of 2013 than a year previously (Source: 'Daft Rental Report' Q4 2013).
  • In Dublin alone, asking rents rose by 11.2% on a year-on-year basis in Q4 2013 (Source: 'Daft Rental Report' Q4 2013).

Significant market consolidation opportunity

  • The Board believes there is the opportunity for the Company to be a consolidator of multi-unit residential real estate on the Island of Ireland.
  • Lack of significant historical institutional ownership in the Irish residential rental market.
  • Approximately 14,000 residential units held by NAMA
  • Approximately 30,000 buy-to-let mortgage loan accounts in Ireland in arrears over 90 days at December 2013.
  • At end of 2013, the six main banks in Ireland had 3,179 buy-to-let properties in receivership.
  • The Directors expect that approximately 10,000 units of foreclosed buy-to-let properties may come to market throughout 2014 and 2015.

SUMMARY OF THE INVESTMENT MANAGEMENT ARRANGEMENTS

Investment Management Agreement

The Company will appoint CR Fund Management Limited, a wholly owned subsidiary of CAPREIT LP, as its investment manager conditional on the Investment Manager being approved as an alternative investment fund manager within the meaning of Directive 2011/61/EU of the European Parliament and of the Council of 8th June 2011 on Alternative Investment Fund Managers ("AIFM") by the Central Bank under the European Union (Alternative Investment Fund Managers) Regulations 2013 of Ireland ("AIFMD Regulations"). The Investment Manager submitted an application to the Central Bank for authorisation as an AIFM on 20 February 2014. It is not expected, however, that approval will be granted by the Central Bank prior to Admission.

The investment management agreement between the Company and the Investment Manager (the "Investment Management Agreement") will govern the provision by the Investment Manager of portfolio management, risk management and other services pursuant to the AIFM Regulations to the Company.  It is conditional upon and will take effect upon the Investment Manager becoming authorised by the Central Bank as an AIFM, has an initial term of five years, unless it is terminated pursuant to the terms of the Investment Management Agreement and thereafter (unless subsequently terminated) will continue for consecutive five year periods.

The Investment Manager is entitled to receive annual fees, payable monthly in arrears, equal to 0.5% of the value of the Company's net asset value and 3% of gross rental income (the "Annual Fees"). There is no maximum fee payable under the Investment Management Agreement.

Interim AIFM Agreement

Until such time as the Central Bank approves the Investment Manager as an AIFM, the Company will engage the services of Gandon Alternative Fund Management Limited (the "Interim AIFM"), an entity authorised by the Central Bank as an AIFM under the AIFMD Regulations, as its AIFM on an interim basis. During the term of its appointment, the Interim AIFM will be paid a fee equal to the Annual Fees, from which it will pay the Investment Manager a fee pursuant to the Delegation Agreement referred to below.

The agreement entered into between the Company and the Interim AIFM (the "Interim AIFM Agreement") governs the provision by the Interim AIFM of certain investment management services (including risk management and advisory services) to the Company which must be provided by an authorised AIFM, from Admission until such time as the Investment Manager is authorised as an AIFM. It has an initial term of three months and will be automatically renewed at the Company's discretion for subsequent one month periods but terminates automatically when the Investment Management Agreement becomes unconditional.  The Interim AIFM has discretionary authority to enter into transactions for and on behalf of the Company, subject to certain reserved matters that require the consent of the Board. Responsibility for certain asset and property management services will be delegated by the Interim AIFM to the Investment Manager pursuant to the Delegation Agreement (defined below). 

The Interim AIFM is not a member of the CAPREIT group or otherwise associated with the Company or CAPREIT.

Delegation Agreement

The delegation agreement to be entered into between the Interim AIFM and the Investment Manager (the "Delegation Agreement") will govern the provision of certain asset and property management services by the Investment Manager. It will continue until such time as the Interim AIFM Agreement is terminated.  

Services Agreement

The services agreement to be entered into between the Company, the Investment Manager and CAPREIT LP (the "Services Agreement") will govern the provision by CAPREIT LP of property management services, asset management services and administrative services to the Investment Manager during the term of both the Interim AIFM Agreement and the Investment Management Agreement.

The Services Agreement also provides that the Investment Manager and CAPREIT LP shall not and they will procure that none of their group companies (if any) and no Investment Manager Affiliate or CAPREIT Affiliate (as defined in the Services Agreement) will, during the term of the Services Agreement, (i) acquire or invest in property on the Island of Ireland which is within the parameters of the investment policy and the investment strategy of the Company set out in the Prospectus or (ii) act as investment manager, investment adviser or agent, or provide administration, investment management or other services, for any person, entity, body corporate or client other than the Company or any shareholding through its investment intermediary or nominee shareholders through which CAPREIT LP may hold its shareholding in the Company. CAPREIT LP is paid its fee under the Services Agreement out of the fees payable to the Interim AIFM (during the term of its appointment) and out of the Annual Fees.

BOARD OF DIRECTORS

The Company

The Company has a highly experienced Board with Colm Ó Nualláin as Chairman and three other Non-Executive Directors, as well as Mr David Ehrlich as the sole executive director. Board members have held senior positions in a number of public and private companies.

David Ehrlich - CEO & Executive Director

David Ehrlich was a senior partner of the Canadian law firm Stikeman Elliott LLP for 10 years until his retirement in December 2013. From 1986 he focused his practice on the public real estate markets and was involved in creating the real estate investment trust industry in Canada, including the formation of CAPREIT. During his years practising as a lawyer, Mr Ehrlich acted for a number of Canada's leading real estate investment trusts, investment banks, life insurance companies, banks, pension funds, developers, property owners, asset managers and governmental agencies. 

Thomas Schwartz - Investment Manager Nominee Director to the Board

Thomas Schwartz has over 35 years of real estate experience. Mr Schwartz founded CAPREIT, Canada's first apartment real estate investment trust. Mr Schwartz currently is President and Chief Executive Officer of CAPREIT and has supervised CAPREIT's growth from 2,900 residential units to over 41,200, with an estimated total asset value of approximately C$5.3 billion. Mr Schwartz is active in industry and government affairs and is currently on the Board of Trustees of CAPREIT; the Board of Directors of Chartwell Seniors Housing REIT; the Board of Directors of REALpac; and the Board of Directors of the Mount Sinai Hospital Foundation.  Mr Schwartz is also a member of the Schulich School of Business Advisory Council - Program in Real Estate and Infrastructure. Mr Schwartz will also be a director of the Company as the Investment Manager's nominee.

Colm Ó Nualláin - Independent Non-Executive Chairman

Colm Ó Nualláin is recently retired after over 20 years as Finance Director of Grafton Group plc, a leading builders merchant group quoted on the London Stock Exchange. Mr Ó Nualláin is a qualified chartered accountant with international experience previously holding senior financial positions in a number of public and semi-state companies.

Declan Moylan - Independent Non-Executive Director

Declan Moylan is the former managing partner and former chairman of Mason Hayes & Curran and is currently of counsel to Mason Hayes & Curran. Mr Moylan is a member of the Law Society of Ireland, the Law Society of England and Wales, the International Bar Association and the Irish Centre for European Law. Mr Moylan is a director of several Irish companies, and is a member of the Board of Trustees of Dublin City University Educational Trust.

Aidan O'Hogan - Independent Non-Executive Director

Aidan O'Hogan is a fellow of the Society of Chartered Surveyors Ireland and past president of the Irish Association of Valuers Institute. In 2009, he retired as chairman of Savills Ireland after 40 years as a real estate professional. Mr O'Hogan is currently chairman of Property Industry Ireland.  Mr O'Hogan was previously managing director and chairman of Hamilton Osborne King, with almost 20 years' experience there.

INVESTMENT MANAGER -  BOARD OF DIRECTORS

The board of directors of the Investment Manager will comprise of the following individuals.

Thomas Schwartz - Director of Investment Manager

See above.

Michael Boyce - Director of Investment Manager

Michael Boyce acts as an independent director and a consultant to a number of Irish investment funds and management companies to such funds. Prior to this, he was executive director of Northern Trust Investor Services (Ireland) Limited, formerly Ulster Bank Investment Services Limited (UBIS), since 1990. He was managing director of Ulster Bank Custodial Services which was the Trustee and Custody operation of Ulster Bank fund's business from 1990 to 1997. From 1997 to 2000 he was managing director of Ulster Bank Investment Services. He has worked in financial services industry for over 30 years including stockbroking, fund management and fund administration.

Simon O'Sullivan - Director of Investment Manager

Simon O'Sullivan has worked in the investment management sector since 1993. He has worked in Pioneer Alternative Investments in Dublin as a product specialist, in Fleming Investment Management as a fund manager in London and in Eagle Star and in Merrion Capital, both in Dublin. In May 2013, Mr O'Sullivan became a partner in Maraging Funds Limited, trading as RiskSystem, a specialist provider of financial risk solutions to the investment funds industry.

DETAILS OF THE PLACING

Under the Placing, the Company is seeking to raise gross proceeds of approximately €200 million pursuant to a placing of its Ordinary Shares with certain institutional and qualified professional investors in various jurisdictions and, in Ireland only, with institutional and qualified professional investors and/or private investors acting on the advice of their stockbroker or financial advisor as well as specialised international real estate investors. CAPREIT LP will subscribe for up to 10% of the Placing through a trustee on behalf of an intermediary vehicle (a qualifying investor alternative investment fund of which CAPREIT LP is the sole beneficiary).

Investec Bank plc and TD Securities Inc. are acting as Joint Bookrunners in connection with the Placing. Investec Bank plc (acting through its Irish Branch) is acting as sole Sponsor in connection with Admission on the Irish Stock Exchange and to trading on the regulated market for listed securities on the Irish Stock Exchange. Full details of the Issue will be included in the Prospectus, which is expected to be published in due course.

IMPORTANT NOTICES

The contents of this announcement, which have been prepared by and are the sole responsibility of Irish Residential Properties REIT plc, have been approved by Investec Bank plc for the purposes of section 21(2)(b) of the Financial Services and Markets Act 2000 ("FSMA").

The information in this announcement is for background and informational purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. The material set forth herein is for information purposes only and should not be construed as an offer of securities for sale in the United States or any other jurisdiction.

This announcement is an advertisement and not a prospectus (or prospectus equivalent document). Investors should not subscribe for or purchase any shares referred to in this announcement except solely on the basis of information in the prospectus (the "Prospectus") to be published by the Company in due course in connection with the admission of the ordinary shares in the capital of the Company to the Official List of the Irish Stock Exchange ("Admission") and to trading on the regulated market for listed securities of the Irish Stock Exchange.  Neither this announcement nor any part of it shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract or commitment whatsoever.

The distribution or publication of this announcement, any related documents, and the offer, sale and/or issue of the Ordinary Shares in certain jurisdictions may be restricted by law. No action has been taken to permit possession or distribution or publication of this announcement, other than in Ireland. Persons into whose possession this announcement (or any other offer or publicity material relating to the shares) comes are required to inform themselves about and to observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdiction.

This announcement does not constitute or form part of an offer to sell, or the solicitation of an offer to buy or subscribe for, shares to any person in any jurisdiction to whom or in which such offer or solicitation is unlawful.

Any subscription of Ordinary Shares in the proposed Placing should be made solely on the basis of the information contained in the Prospectus to be issued by the Company in connection with Admission. No reliance may or should be placed by any person for any purposes whatsoever on the information contained in this announcement or on its completeness, accuracy or fairness. The information contained in this announcement is given at the date of its publication (unless otherwise marked) and is subject to updating, revision and amendment when the Prospectus is published. In particular, the proposals referred to herein are tentative and are subject to verification, material updating, revision and amendment.

The Ordinary Shares are only suitable for investors who understand the potential risk of capital loss and that there may be limited liquidity in the underlying investments of the Company and in the shares, for whom an investment in the shares is part of a diversified investment programme and who fully understand and are willing to assume the risks involved in such an investment programme. There is no guarantee that the Placing will proceed and that Admission will occur and you should not base your financial decisions on the Company's intention in relation to the Admission and the Placing at this stage. Acquiring the Ordinary Shares to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested.  When considering what further action you should take you are recommended to immediately consult, if you are resident in Ireland, an organisation or firm authorised or exempted pursuant to the European Communities (Markets in Financial Instruments) Regulations 2007 (Nos. 1 to 3) or the Investment Intermediaries Act 1995 (as amended) or another appropriately authorised professional adviser if you are in a territory outside Ireland. This announcement does not constitute a recommendation concerning the Placing. The price and value of the Ordinary Shares may decrease as well as increase. Information in this announcement, past performance and any documents relating to the Placing or Admission cannot be relied upon as a guide to future performance.

This announcement is for distribution in the United Kingdom only to persons who (i) have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the "Financial Promotion Order"), (ii) are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc") of the Financial Promotion Order, or (iii) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as "relevant persons"). This announcement is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this announcement relates is available only to relevant persons and will be engaged in only with relevant persons.

This announcement does not constitute and is not intended to constitute the direct or indirect offering or placement of shares of an alternative investment fund within the meaning of the Alternative Investment Fund Managers Directive (2011/61/EU) (the "AIFMD"). In any event, this announcement is directed at and is only being distributed in member states of the European Economic Area to Relevant Persons who are professional investors within the meaning of Article 4(1)(ag) of the AIFMD.

This announcement is not an offer of securities for sale in the United States.  The shares discussed in this announcement have not been and will not be registered under the US Securities Act of 1933, as amended, or the securities laws of any state of the United States, and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction subject to, the registration requirements of the US Securities Act of 1933, as amended, and applicable state securities laws. There will be no public offer of securities in the United States. Copies of this announcement are not being, and should not be, distributed in or sent into the United States.

It may be unlawful to distribute this announcement in certain jurisdictions.  This announcement is not for distribution in Canada, Japan, Australia or South Africa.  The information in this announcement does not constitute an offer of securities for sale in Canada, Japan, Australia or South Africa.

THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS AND INVESTORS SHOULD NOT PURCHASE ANY ORDINARY SHARES REFERRED TO IN THIS ANNOUNCEMENT EXCEPT SOLELY ON THE BASIS OF THE INFORMATION IN THE PROSPECTUS IN ITS FINAL FORM AND ANY SUPPLEMENTARY PROSPECTUS. THE PROSPECTUS, FOLLOWING PUBLICATION, WILL BE AVAILABLE ON THE WEBSITE OF THE CENTRAL BANK.

Certain statements contained in this announcement constitute "forward-looking statements" regarding the belief of current expectation of the Company, the Directors, the Investment Manager and the Management Team about the Company's financial condition, results of operations and business. Generally, but not always, words such as "may ", "could ", "should ", "will ", "expect ",  "intend ", "estimate ", "anticipate ", "assume ", "believe", "plan ", "seek ", "continue",  "target ", "goal ", "would" or their negative variations or similar expressions identify forward-looking statements. Such forward-looking statements are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside the control of the Company, the Directors,  the Investment Manager and the Management Team and are difficult to predict, which may cause the actual results, performance, returns,  achievements or developments of the Company or the industries in which it operates to differ materially from any future results, performance, achievement or developments expressed or implied from these forward-looking statements. Forward-looking statements speak only as of the date they are made and cannot be relied upon as a guide to future performance. A number of material factors could cause actual results to differ materially from those contemplated by the forward-looking statements. None of the Company, the Investment Manager, Investec Bank plc nor TD Securities Inc. undertakes any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances, unanticipated events, new information or otherwise occurring after the date of this announcement except as required by law or by any appropriate regulatory authority. All subsequent written and oral forward-looking statements attributable to Irish Residential Properties REIT plc or individuals acting on behalf of Irish Residential Properties REIT plc are expressly qualified in their entirety by this paragraph.

Investec Bank plc which is authorised in the United Kingdom by the Prudential Regulation Authority and regulated in the United Kingdom by the Financial Conduct Authority and the Prudential Regulation Authority and registered under Financial Services Register reference 172330, is acting exclusively for the Company and no one else in connection with the Placing and Admission and will not be responsible to anyone other than the Company for providing the protections afforded to its clients, for the contents of this Announcement or for providing any advice in relation to this Announcement, the Placing or Admission. In connection with the admission of the Ordinary Shares to the Official List of the Irish Stock Exchange and to trading on the regulated market for listed securities of the Irish Stock Exchange, Investec Bank plc is acting through its Irish Branch which is authorised by the Prudential Regulation Authority in the United Kingdom, and is regulated by the Central Bank of Ireland for conduct of business rules, registered with the Irish Companies Registration Office under number 904428 as an external company and has a registered branch office at The Harcourt Building, Harcourt Street, Dublin 2, Ireland.

TD Securities, which is registered as an investment dealer under the securities legislation of all provinces and territories of Canada and a member of the Investment Industry Regulatory Organization of Canada, is acting exclusively for the Company and no one else in connection with the Placing and Admission and will not be responsible to anyone other than the Company for providing the protections afforded to its clients, for the contents of this Announcement or for providing any advice in relation to this Announcement, the Placing or Admission.

In connection with the Placing and Admission, each of Investec Bank plc and TD Securities Inc., or any of their respective affiliates, acting as investors for their own accounts, may subscribe for or purchase Ordinary Shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Ordinary Shares and other securities of the Company or related investments in connection with the Placing or otherwise. Accordingly, references in the Prospectus, once published, to the Ordinary Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, Investec Bank plc or TD Securities Inc. or any of their respective affiliates acting as investors for their own accounts. Neither Investec Bank plc nor TD Securities Inc. nor any of their respective affiliates intend to disclose the extent of any such investments or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

None of the Company, the Investment Manager, Investec Bank plc, TD Securities Inc., or any of their respective affiliates, their respective directors, officers or employees, or any other person accepts any responsibility or liability whatsoever for the contents of, or makes any representation or warranty, express or implied, as to the accuracy, completeness, correctness or fairness of the information or opinions contained in this announcement or any document referred to in this announcement (or whether any information has been omitted from this announcement) or any other information relating to the Company or the Investment Manager or their respective affiliates, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith.

Accordingly, the Company, the Investment Manager, Investec Bank plc, TD Securities Inc. and any of their respective affiliates, their respective directors, officers or employees, and any other person acting on their behalf expressly disclaims, to the fullest extent possible, any and all liability whatsoever for any loss howsoever arising from, or in reliance upon, the whole or any part of the contents of this announcement, whether in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.

The contents of this announcement are not to be construed as legal, financial or tax advice. Each prospective investor should consult his own legal adviser, financial adviser or tax adviser for legal, financial or tax advice, respectively.

This announcement has been issued through the Companies Announcement Service of the Irish Stock Exchange.

[1]These are targets only and not profit or dividend forecasts. There can be no assurance that this target can or will be met and it should not be seen as an indication of the Company's expected or actual results or returns.  Accordingly, investors should not place any reliance on this target return in deciding whether to invest in the Ordinary Shares.  In addition, prior to making any investment decision, prospective investors should carefully consider the risk factors described in the Prospectus.

This information is provided by RNS
The company news service from the London Stock Exchange

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