Canadian Tire sells 11 stores for $164 million

Canadian Tire Corp. has sold 11 stores to two Canadian real estate trusts for $164.6 million. Canadian Real Estate Investment Trust, commonly known as CanReit, will buy eight properties for $137 million. Charter Real Estate Investment Trust will purchase three other stores for $27.3 million. Canadian Tire will continue to run the stores but will now lease these facilities and pay rent to the two companies.The properties are spread across Canada. CanReit, for example, is getting three stores in Alberta, two in Quebec and one each in British Columbia, Nova Scotia and Ontario. Canadian Tire will remain as the stores’ operators for at least the next 15 years, reducing the chances that either trust will need to find a new tenant for these properties.

Last month, Canadian Tire said it wanted to sell 12 of its properties to third-parties and then lease the stores back from the purchaser. Known as a sale and leaseback, this type of transaction allows the company to get a chunk of cash right away while spreading the leasing costs over a longer period. Once all the properties are sold, the company expects to net $70 million. Canadian Tire has not said anything about the one remaining property up for sale. (Tire Review/Akron)