Student Housing Major Milestone Achieved

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We are back at it again. We have lined up another exciting acquisition. The current acquisition adds a tremendous amount of value and is completely transformational. The following key things will be accomplished with this acquisition;

  1. Adds 4 new buildings that are located near tier one Universities in Canada. This brings our total to 7 Buildings and over 3,300 beds. We are now the largest owner operator of Purpose Build Student Housing “PBSA” in Canada.
  2. Diversifies the REITs asset base to more markets that now include a strong hold in Waterloo and Ottawa as well as a presence in both Hamilton and Oshawa.
  3. We will undoubtedly have the highest quality portfolio in Canada with almost all of our buildings being less than 10 years old.
  4. The price we have paid for all of these buildings still is projected to generate a 15%+ IRR (rate of return)/annum.

We are currently raising $75 million of equity to fund the acquisition. We would encourage all unitholders to make an additional investment as this transformational acquisition substantially de-risks the student housing strategy. We will have over $350 million of property in the portfolio and be well ahead of schedule in the accumulation of Student Housing in Canada. We also encourage unitholders to refer any new investors they may think would be interested in our strategy.

Executive Summary

ASH REIT is the only investment vehicle focused exclusively on the Canadian Student Housing Market.

ASH REIT is currently focused on the consolidation of the fragmented Canadian PBSA market

Success to date of the REIT has exceeded expectations

  • 3 Class A+ properties in Tier-1 markets worth over $200 million
  • Quality and quantity of available assets
  • Attractive acquisition prices given limited competition (private transactions)
  • Operational upside to properties day-1

Transformational acquisition to close in April 2019

  • Portfolio consisting of 4 properties with 1,992 beds to be acquired for $170 million
  • Similar high-quality assets to current portfolio at an attractive all-in purchase price
  • Diversifies portfolio and positions ASH REIT as the largest owner/operator of PBSA in Canada
  • Unique opportunity to integrate new properties with current asset in Waterloo market
  • Scale will allow ASH REIT to commence movement of property management in-house

ASH REIT is seeking to raise up to $75 million of new equity in Q1/Q2 2019 to fund the Portfolio acquisition and position the REIT for additional high-quality acquisitions in the near-term

  • Sale of units to fund purchase expected to yield annual distributions (mainly return of capital) in excess of 6% to unitholders and long-term returns in excess of 15%
  • Units prices attractive relative to alternative real estate investments

We look forward to updating everyone in April when the transaction closes. Thanks again for your support.


Planning for the New Passive Income Rules Affecting Private Corporations

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In July 2017, Finance Minister Bill Morneau announced potential options for changing the taxation of investment income earned by private corporations. The proposed changes were strongly opposed by many stakeholders and, in October 2017, Minister Morneau announced that changes would be made to the proposed new rules and that draft legislation would be released as part of Budget 2018. The resulting highly anticipated Budget was tabled by Minister Morneau on February 27, 2018. While Budget 2018 has scaled back many of the proposed measures from the July 2017 Consultation Paper, it has moved forward with various amendments to the Income Tax Act1 that will affect small business corporations in Canada. The amendments with respect to passive income earned by a private corporation will still have an adverse effect on small business owners and may affect the way small business owners choose to invest their retained earnings. In particular, the effect of the changes on the small business deduction (“SBD”) will likely leave small business owners seeking tax-efficient options for the investment of corporate retained earnings that will reduce the impact of these changes.

Bill C-74, which contains the legislative provisions to implement the new passive income rules, received Royal Assent on June 21, 2018.


Alignvest Strategic Partners Fund Quarterly Report

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Dear Investors,
We are pleased to send you our fourth quarter 2018 report for Alignvest Strategic Partners Fund.  The Q4 update discusses performance over the past quarter and our thoughts going forward.  Moreover, it includes a snapshot of the portfolio holdings as of the start of 2019.

Q4 2018 Performance

  • Alignvest Strategic Partners Fund was down 4.65% (Class F, net of fees) during Q4 2018 and ended 2018 down 2.53% in what turned out to be a volatile year for world markets.  Performance was within expectations given our 45% weight to global equities which was mitigated by several of the portfolio’s alternative assets and strategies that performed well (including some gains in December).

Please click below to view our Q4 2018 performance report as well as the Fund Brochure.

Additional information and a product video for Alignvest Strategic Partners Fund can be found on our site as well.

As always, please feel free to contact our team to discuss the Fund in greater detail.