Primaris Retail REIT Acquires Place Fleur De Lys

On July 20, 2005, Primaris Retail REIT, through a newly formed Ontario limited partnership, acquired the real estate and partnership interests relating to the Place Fleur de Lys Shopping Centre in Quebec City for a total consideration of $85 million. Primaris will make a $91.5 million investment in this asset and will assume an existing credit facility and mortgage on the property with Desjardins Financial Security Life Assurance Co. and Sun Life Assurance Company of Canada representing a current balance of approximately $34 million.

Primaris acquired Place Fleur de Lys from five vendors who are all Ontario corporations. The new limited partnership issued to the vendors $40 million of exchangeable units as partial consideration for the purchase of Place Fleur de Lys. These units are exchangeable into units of Primaris Retail REIT on a one-for-one basis and, prior to exchange, are entitled to the same distributions as made on Primaris units. The exchangeable units are accompanied by certain voting rights and are subject to certain hold restrictions. The exchangeable units were priced at $14.04 per unit, being the weighted average closing price of Primaris units on the TSX for the 20 trading days beginning May 6, 2005 and ending June 3, 2005.

Primaris was represented internally by Devon Jones, and externally by Blake, Cassels & Graydon LLP, with a team that included Norm Saibil, Angelo Noce, Steve Samson and Viorelia Guzun in Montreal, as well as Jim Hilton, Iris Tam and Robert Kwinter in Toronto. Frank DeLuca of McCarthy Tétrault LLP in Toronto advised Primaris on the
exchangeable unit, securities and TSX listing aspects of the transaction, while Glen Ladouceur of KPMG LLP in Toronto provided advice on the tax structure of the transaction.

The five vendors were represented internally by Wendy Posluns, and externally by Denis Paquin (real estate), Michel Boislard (corporate) and Gilles Carli (taxation) of Fasken Martineau DuMoulin LLP in Montreal. The lenders in the Desjardins credit facility were represented internally by Carmen Hélie and externally by Fraser Milner Casgrain LLP in Montreal, with a team that included Louis Clément (corporate), Barbara Farina (banking), and Jenny Ross, Robert Béland and Yan Besner (real estate).
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