01:25 PM EDT, 07/15/2024 (MT Newswires) -- CAPREIT (CAR) entered into an agreement with TPG Real Estate to sell its manufactured homes communities (MHC) portfolio for $740 million, which is 5% premium to the IFRS carrying value of $708 million and implies a 5.8% cap rate. National Bank notes that the REIT has been strategically disposing of non-core / non-Canadian apartment assets and pivoting into newly built assets in higher growth markets.

This sale frees up a significant amount of capital to accelerate the strategy. With net MHC proceeds of over $400 million and an additional $300 million expected from the up-financing of mortgages through 2024, "CAR is now flush with capital," writes analyst Matt Kornak.

Reiterate Outperform rating, $56 target.

Price: 47.50, Change: +0.19, Percent Change: +0.40