CIBT Provides Update on Global Education City (Richmond)
Vancouver, BC, January 3rd, 2019 – CIBT Education Group Inc. (TSX: MBA, OTCQX International: MBAIF) (“CIBT” or the “Company”) is pleased to report that one of its real estate investment projects, Global Education City® (Richmond) (the “Project”), located in Richmond, BC received its Development Permit in November 2018 and began excavation and site preparation during December 2018. The approvals are based on a community development plan under which seven high rise towers are to be established in the city centre of Richmond, BC. Originally, Global Education City® (Richmond) was designed as a single office tower with two high rise residential rental towers totalling approximately 368,000 square feet. Due to the significant rental shortage in the Metro Vancouver region, the Project has experienced an increase in value.
In addition to the rental housing crisis in Metro Vancouver, there are considerable market demands for affordable living options in the condominium space. The limited partnership that is acquiring the Project (the “LP”) and the developer have reached an agreement to relinquish one of the two rental towers to the developer. The developer will convert one rental tower into market condominiums available for sale. In exchange for this arrangement, the purchase price for the Project’s remaining office tower and one residential rental tower has been reduced by more than $32 million, from $218 million to $109 million which factored in a square footage reduction and a discount. The total rentable square footage of the Project has been reduced from 368,000 square feet to approximately 238,000 square feet. The total cost per rentable-square-foot (“RSF”) including land, construction, soft-cost and finance fee has decreased to $459/RSF, down 23% from $592/RSF.
The LP has raised a total of $51 million in equity investment since March 31st, 2018. To date, CIBT has earned $10 million in development fees from this Project and anticipates earning an additional $2 million in fees through fiscal 2019. These funds have been used by CIBT to acquire at least a 20% equity interest in this GEC® project.
“We are excited about the development of Global Education City® (Richmond) which represents our eighth GEC® project and the 9th and 10th GEC® buildings in Metro Vancouver upon completion,” commented Toby Chu, Chairman, President and Chief Executive Officer of CIBT. “Global Education City® (Richmond) represents a key part of our growing portfolio of student housing residences throughout British Columbia and will contribute an additional 466 beds and 127,000 square feet of office and educational space to our portfolio, once completed.
“With eight projects now under our portfolio, 2019 is shaping up to be a year of strong growth as we continue to increase our bed count and maintain our position as western Canada’s leading education and student housing provider. The focus will be to continually retain a larger equity ownership in each of our projects so that CIBT Education Group shareholders can benefit from a profitable education business reinforced by a lucrative and rapidly growing student housing business.”
About CIBT Education Group:
CIBT Education Group Inc. is one of the largest education, and student housing investment companies in Canada focused on the global education market since 1994. Listed on the Toronto Stock Exchange and U.S OTCQX International, CIBT owns business and language colleges, student housing properties, recruitment centres and corporate offices at 43 locations in Canada and abroad. Total annual enrollment for the group exceeds 12,000 students. Its education providers include Sprott Shaw College (established in 1903), Sprott Shaw Language College, Vancouver International College and CIBT School of Business. Through these schools, CIBT offers business and management programs in healthcare, hotel management, language training, and over 150 career, language and vocational programs. CIBT owns Global Education City Holdings Inc., an investment holding and development company focused on developing education related real estate such as student hotels, serviced apartments and education super centres. Total portfolio and development budget of projects under the GEC® brand is more than C$1 billion. CIBT also owns Global Education Alliance (“GEA”) and Irix Design Group (“Irix Design”). GEA recruits international students on behalf of many elite kindergartens, primary and secondary schools, colleges and universities in North America. Irix Design is a leading design and advertising company based in Vancouver, Canada. Visit us online and watch our corporate video at www.cibt.net.
For more information contact:
Chairman, President and Chief Executive Officer
CIBT Education Group Inc.
Investor Relations Contact: 1-604-871-9909 extension 318 or | Email: email@example.com
Some statements in this news release contain forward-looking information (the “forward-looking statements”). Forward-looking statements are statements that are not historical facts and in this news release include, without limitation, the statement that CIBT anticipates earning an additional $2 million in development fees in respect of the Project during fiscal 2019. 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, the ability of the Group to raise additional investment as well as mortgage financing, usual construction risks, the ability to obtain all required municipal approvals, and the ability of the LP to satisfy all borrowing obligations. 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.