Plazacorp completes bought deal public offering of $40 million common shares and $30 million of convertible unsecured subordinated debentures

Oct 24, 2013

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

FREDERICTON, Oct. 24, 2013 /CNW/ - Plazacorp Retail Properties Ltd. ("Plazacorp" or the "Company") (TSX: PLZ) announced today that it has closed its previously announced bought deal public offering (the "Offering") of 9,400,000 common shares (the "Shares") of Plazacorp issued from treasury at a price of $4.25 per Share for gross proceeds to the Company of $40 million and $30 million aggregate principal amount of 5.75% convertible unsecured subordinated debentures due December 31, 2018 (the "Debentures"). The underwriting syndicate for the Offering was led by RBC Capital Markets. The Debentures are convertible at the option of the holder, into common shares of the Company at $5.75 per common share.

Plazacorp has granted the Underwriters an over-allotment option (the "Over-Allotment Option"), exercisable in whole or in part up to 30 days after closing of the Offering, to purchase up to an additional 1,410,000 common shares and $4.5 million additional aggregate principal amount of Debentures to cover over-allotments, if any.

As previously announced, Plazacorp intends to use the net proceeds from the Offering as follows:

(i)	approximately $15 million to fully repay the balance that is currently outstanding on the Company's operating line of credit (the majority of which was drawn to fund Plazacorp's on-going development and re-development program and previous acquisitions);

(ii)	approximately $35 million to partially repay the Company's bridge facility, which was drawn to fund the cash portion of its acquisition of KEYreit;

(iii)	approximately $16 million to redeem the currently outstanding Series A 7.75% convertible unsecured subordinated debentures, which mature on December 31, 2014 and which have a par call date of December 31, 2013 (the "Series A Debentures"). Plazacorp intends to provide notice of redemption to holders of the Series A Debentures in November 2013; and

(iv)	the remainder, if any, will be used to fund the Company's future and on-going development and re-development activities and for general corporate purposes.

Plazacorp intends to use the net proceeds, if any, from any exercise of the Over-Allotment Option to partially repay the bridge facility.

ABOUT PLAZACORP

Plazacorp is a leading retail property owner and developer, particularly in Eastern Canada. Plazacorp has an entrepreneurial focus with strong "value-add" capabilities. Plazacorp's current portfolio includes interests in approximately 343 properties totaling approximately 6.6 million square feet across Canada and additional lands held for development. Plazacorp's properties include a mix of strip plazas, stand-alone small box retail outlets and enclosed shopping centres, anchored by approximately 90% national tenants. Total assets have reached almost $1 billion. Plazacorp is fully internalized, therefore providing shareholders directly with the synergies that come with an internalized management structure. Plazacorp has proven its strong "value-add" capabilities to develop, redevelop and acquire retail real estate throughout Canada. Plazacorp has a strong track record of generating growth in distributions, having increased its distributions at least once every year in the last 10 years.

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS

All statements in this press release that do not relate to historical facts constitute forward-looking statements. These statements represent Plazacorp's intentions, plans, expectations and beliefs and are subject to certain risks and uncertainties that could result in actual results differing materially from these forward-looking statements. These risks and uncertainties are more fully described in regulatory filings that can be obtained on SEDAR at www.sedar.com.

SOURCE Plazacorp Retail Properties Ltd.

For further information:

Visit our website at: www.plaza.ca
Or contact: Michael Zakuta, President and Chief Executive Officer, at (514) 457-0997 or Floriana Cipollone, Chief Financial Officer, at (416) 848-4583