CIBT Increases Size of Student Housing Development in Central Vancouver
February 9th, 2016: CIBT Education Group Inc. (TSX: MBA; OTCQX International: MBAIF) (“CIBT”) is pleased to announce that the Purchase and Sale Agreement (“PSA”) with a Vancouver developer for a Global Education City project announced on May 27th 2015 (see previous news release here:http://www.cibt.net/news/20150527.php) has been expanded to include a third lot. The acquisition of the third lot will expand the land size of this project, previously referred to as Project 3 and now referred to as Project 6 (“GEC Project 6”), by 54% and increase the total number of available beds by an additional 53%.
GEC Project 6 is centrally located in Vancouver, approximately 300 feet from a Skytrain/Subway station. It is expected to be comprised of 46,000 net rentable square feet accommodating up to 184 student beds upon completion of development. The location of GEC Project 6 is only two subway stations (or 5 minutes) from downtown Vancouver in which over 100 educational institutions have presence including public institutions such as University of British Columbia, Simon Fraser University, British Columbia Institute of Technology and Vancouver Community College, private colleges such as Sprott Shaw College, and many language schools. Substantial student populations, both domestic and international, are enrolled at these institutions.
The total project cost of GEC Project 6 is estimated at $30 million including leasehold improvement, furniture, fixtures and equipment. GEC Project 6 will be a fully furnished serviced apartment building which is expected to complete in approximately 34 months. Three independent investors have been brought in to fund this development through a new limited partnership (the “LP”), along with CIBT’s wholly owned subsidiary, Global Education City Holdings Inc. (“Global Education”). The total cash equity portion of GEC Project 6 is expected to be $8.5 million, of which approximately $5 million has been received and the balance is payable within one year.
CIBT will be paid a structuring fee in connection with this project. CIBT plans to use the fees earned plus its capital resources to acquire up to 21% of the issued LP units. In addition, a subsidiary of CIBT will be the general partner for this project, and another subsidiary of CIBT will provide management services for 20 years.
“We are very pleased with the rapidly growing GEC branded student housing portfolio. This latest property acquisition increases the student housing portfolio under the GEC brand to approximately $170 million in assets, with 1,088 student beds in operation and undergoing development since Global Education’s inception 21 months ago,” commented Toby Chu, President and CEO, Vice Chairman of CIBT. “We remain committed to our business plan and strategy to acquire more education assets in the career college and language school sector to enhance the value of our student housing assets.”
About CIBT Education Group:
CIBT Education Group Inc. is an education management company focused on the global education market since 1994. Listed in Canada on the Toronto Stock Exchange and in the U.S. on the OTCQX International, CIBT owns and operates a network of business, technical and language colleges in North America and Asia. CIBT offers cooperative joint programs in 12 countries with campuses, recruitment offices and training centers enrolling over 7,000 students annually. Its education business is operated through Sprott Shaw College (established in 1903), Acsenda School of Management, CIBT School of Business China, and Global Education Alliance Recruitment Centers in China and other overseas countries. Through these subsidiaries, CIBT offers recognized and approved business and management degrees, programs in college preparation, healthcare, hotel management and tourism, English language training, English Teacher Certifications, junior and high school preparation programs for overseas study, and other career/vocational training. CIBT also owns Irix Design Group, a leading design and advertising company based in Vancouver, Canada, Global Education Alliance (“GEA”) and Global Education City Holdings Inc. (“GEC”). GEA recruits international students for many elite kindergarten, primary, secondary schools and universities in North America. GEC is an investment holding and management company with a special focus on education related real estate projects in Canada. Visit us online at http://www.cibt.netand watch our corporate video athttp://cibt.net/about/
Some statements in this news release contain forward-looking information (the “forward-looking statements”) about CIBT Education Group Inc. and its future plans. Forward-looking statements are statements that are not historical facts. The forward-looking statements in this news release include, without limitation, the increased value of assets and number of beds in the student housing portfolio under the GEC brand resulting from the increase in the size of GEC Project 6. The forward-looking statements are subject to various risks, uncertainties and other factors (collectively, the “Risks”) that could cause CIBT’s actual results or achievements to differ materially from those expressed in or implied by forward-looking statements. The Risks include, without limitation, that the acquisition of GEC Project 6 is not completed. Forward-looking statements are based on the beliefs, opinions and expectations of CIBT’s management at the time they are made, and CIBT does not assume any obligation to update its forward-looking statements if those beliefs, opinions or expectations, or other circumstances should change, except as may be required by law.