New Glasgow, NS, Oct. 10, 2017 /CNW/ - Crombie Real Estate Investment Trust ("Crombie") (TSX: CRR.UN) is pleased to announce that it recently received court approval of a lease surrender agreement with Sears Canada Inc. ("Sears") in respect of its store at the Avalon Mall in St. John's, Newfoundland and Labrador. In consideration of receiving a $5 million lease surrender fee, Sears has agreed to an early termination of its lease to vacate their 128,000 square foot store by February 28, 2018. This will enable acceleration of Crombie's redevelopment plans for the space.
Given Avalon Mall's dominance in the St. John's market, there has been significant ongoing leasing interest from numerous national tenants for this space. Management believes these new tenants will improve the mall's merchandising mix, drive additional customer traffic, and provide Crombie with considerably more rental income than what is generated today.
Crombie is currently in the first year of redevelopment at Avalon Mall. This Phase I investment is estimated at $54.5 million. These upgrades are expected to enable Crombie to continue to improve tenant mix, increase customer parking capacity, increase sales per square foot, and maximize property income.
"We are delighted to have negotiated this lease surrender with Sears as it enables acceleration of our overall redevelopment plan for Avalon Mall", said Don Clow, President and CEO of Crombie. "We look forward to sharing our redevelopment plans for the space in the near future."
About Crombie REIT
Crombie Real Estate Investment Trust is an unincorporated, open-ended real estate investment trust established under, and governed by, the laws of the Province of Ontario. Crombie currently owns a portfolio of 286 income-producing properties across Canada, comprising approximately 19.4 million square feet with a strategy to own, operate and develop a portfolio of high quality grocery and drug store anchored shopping centres, freestanding stores and mixed use developments primarily in Canada's top urban and suburban markets.
More information about Crombie can be found at www.crombiereit.com.
This news release contains forward-looking information reflecting management's expectations regarding future redevelopment of Avalon Mall and future rental income. The forward-looking statements in this news release are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from current expectations, including the ability to complete construction activity in a timely manner and within budget and the ability to complete new leasing activity, and other risks described in Crombie's Annual Information Form for the year ended December 31, 2016, which can be found at www.sedar.com. Crombie does not undertake to update any forward-looking statements that may be made from time to time by them or on their behalf other than as required by applicable securities laws.
SOURCE Crombie REIT