November 24, 2008

Project Financing

Gobal economic crisis hits Calgary’s Bow office tower

The financial arrangements for the $1.2 billion Bow building in Calgary may be in jeopardy as a result of the current global economic crisis.

“At present there are no financing arrangements in place on any of the REIT’s development projects, and the current difficult economic conditions have impacted H&R’s financing strategy,” said the developer, H&R Real Estate Investment Trust, in its third quarter financial statement

In response to this situation, H&R is exploring the following alternatives to finance its commitments.

• Using H&R’s cash and unused operating line of credit as of September 30, 2008, which totals approximately $232 million. The operating line of credit is due in August of 2009 and is currently secured by charges on 27 properties.

• Securing permanent financing or selling of Bell Phase III project in Mississauga, Ontario.

• Securing construction financing or selling an interest in the Bow.

• Selling or refinancing other assets.

Currently under construction, the Bow building will be EnCana Corporation’s new corporate headquarters. The 58-storey, 775-foot tall office tower will offer approximately two million square feet of space.

Vancouver-based Ledcor Construction is the construction manager for the project.

JOC News Service

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