Allied Properties Real Estate Investment Trust (Allied) announced its acquisition of an ownership interest in 400 West Georgia Street, Vancouver, and an increased stake in 19 Duncan Street, Toronto. The deal for 400 West Georgia entails Allied converting a $198 million mezzanine loan into a 90% undivided interest based on a $395 million property value. This property, developed by Westbank, features office and retail spaces, and is notably designed to LEED Platinum standards.

For 19 Duncan, Allied will enhance its ownership to 95% by converting the remaining $67.5 million of the mezzanine loan into equity and paying Westbank $36.3 million in cash. This transaction values the property at $525.7 million, emphasizing its LEED Gold standard design, full office lease to Thomson Reuters, and a considerable number of residential and commercial parking stalls.

These transactions, expected to close in early April pending Competition Act approval, will significantly reduce Westbank’s debt to Allied and elevate Allied’s ownership in high-value urban properties. The deal puts temporary pressure on Allied’s debt ratios, which is expected to ease with property sales and EBITDA growth from full lease-ups, notably in 19 Duncan’s residential component.

Allied's strategy includes selling non-strategic properties in Toronto and Montréal for up to $200 million, further strengthening its financial metrics and portfolio quality. Legal advisories were not specifically mentioned, but these transactions reflect careful planning and strategic asset reorganization, aiming for long-term growth and portfolio enhancement.