CALGARY, Alberta, August 03, 2021--(BUSINESS WIRE)--Westphalia Development Corporation (the "Corporation") announced today an update for the overall development project and the efforts to date for refinancing. Launched in March 2012, the Corporation acquired for development the 310-acre Westphalia Property (the "Property or the "Project") located in Prince George’s County, Maryland, United States.
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Westphalia Masterplan: Phase 1 is made up of retail commercial, townhome residential, multi-family, and single family for rent. Phase 2 is made up of residential, industrial, and other commercial uses. Phase 3 is made up of industrial commercial, townhome residential and senior living uses. Phase 1A was sold to a third-party developer ~18 months ago. (Graphic: Business Wire)
LAND SALES TO-DATE – US$46.6 MILLION
The Project consists of 4 Phases. Construction on Phase 1 of the project began in 2014. Between 2015 and 2020, the development delivered 346 residential lots to three homebuilders (Ryan Homes (NVR), Mid-Atlantic Builders, and Haverford Homes) and has capitalized on that success with the sale of 58 acres to Galaxy NC, LLC in January 2020 for development of more than 600 residential units. The land sales in Phase 1 and Phase 1A resulted in total revenue of U.S.$46,605,162.
LAND UNDER CONTRACT
US$49.55 M in Purchase and Sales Agreements have been signed as follows:
January 2021 – Total $27.05M in signed Purchase and Sales Agreements with a major industrial builder, to purchase the 26.72 acres of industrial land in Phase 2 at $10.25M and the approximately 25 acres of industrial land in Phase 3 at $16.8M, subject to the satisfaction of certain conditions within the legal agreement.
Early July 2021 – Signed a Purchase and Sales Agreement with a major national homebuilder on the remaining residential land in Phases 1 and 2 at $22.5M, subject to the satisfaction of certain contractual conditions. The purchaser must deliver its Notice of Suitability (waiver of conditions) as to certain due diligence items within approximately 60 days from now.
Residual Land: There are three additional sites in which a vertical strategy is being pursued to work with national or regional retail commercial and senior living builders. The material aspects of this strategy are expected to be in place within the next 60 to 90 days. Walton is evaluating options for consultants to be engaged for this strategy and is seeking partners to build and lease out the two commercial sites (~5 acres and ~14 acres in size, respectively) and the Senior Living site (~13 acres in size).
"The vertical strategy for Westphalia is something we have been discussing for 2+ years", stated Bill Doherty, CEO of the Walton Group of Companies. "The timing we feel is right given the activity on the Westphalia masterplan. We are very active exploring and seeking industry leading regional and/or national retail commercial builders, senior living builders and build-to-rent builders to partner with for the build-out and leasing of our three remaining sites."
Walton, through its broker, has been seeking and has engaged with a potential lead lender for the project. The potential senior lender continues to conduct its ordinary course due diligence and documentation process, which must be completed prior to any closing. Management has also negotiated terms for subordinated financing from its existing lender, WWMN, LLC ("WWMN"), a portion of which is expected to be funded concurrently with the new senior loan. Management continues to work through the documentation and due diligence process for both new loans, which are now expected to be completed prior to August 31, 2021. An Extension Agreement has been executed with the existing senior lender, WWMN, to extend the maturity date of the Corporation’s existing senior debt to August 31, 2021.
DEVELOPMENT PROGRESS (as of July 15, 2021)
PHASE 1 DEVELOPMENT: 346 townhomes and Westphalia Green Park is fully completed
PHASE 1A DEVELOPMENT AND ROADWAY
Phase 1A land is under construction. Westphalia sold these lands to Galaxy NC, LLC in January 2020 for development of approximately 655 residential units. It will be a residential community within the larger Project masterplan.
Roadway construction within the development is progressing at a strong pace. The construction of the Presidential Parkway East was completed in November 2020 opening the access for Phase 1A residential.
Phase 2 consists of lands planned for residential and industrial uses. The industrial portion is currently under contract with an industrial developer with a target closing in the 4th quarter of 2022.
ROADWAY AND PHASE 3 DEVELOPMENT
The remainder of Presidential Parkway West is anticipated to be completed by the 2nd quarter of 2022. These infrastructure improvements are critical for opening the access for future phases of the development. Phase 3 consists of lands planned for retail and industrial uses. Rough grading of the industrial portion is underway, and that property is currently under contract for an anticipated closing of 1st quarter of 2023.
The Corporation is managed by Walton Global Investments Ltd. and the development of the project is managed by Walton Development & Management (USA), Inc., both of which are members of Walton.
Walton is a privately owned, leading global real estate investment, land asset management and administration group that has focused on strategically located land in major growth corridors for more than 40 years. Walton manages and administers US$3.8 billion of real estate assets in North America, on behalf of its investors and business partners. Walton has more than 106,000 acres of land under ownership, management and administration in the United States and Canada. Key entities in Walton include Walton Global Holdings, Walton International Group and Walton Development and Management. For more information visit Walton.com.
This news release, required by Canadian laws, does not constitute an offer of securities, and is not for distribution or dissemination outside Canada. This news release contains forward looking information, and actual future results may differ from what is disclosed in this news release. Forward-looking information is based on the current expectations, estimates and projections of the Corporation at the time the statements are made. They involve a number of known and unknown risks and uncertainties which would cause actual results or events to differ materially from those presently anticipated. The risks, uncertainties and other factors that could cause the Corporation's actual results and performance in future periods to differ materially from the forward looking information contained in this news release include, among other things, the development of Westphalia Town Center, general economic and market factors, including interest rates, a decline in the real estate market, changes in government policies and regulations or in tax laws, changes in municipal planning strategies and whether certain development approvals are obtained and changes in the Canadian/U.S. dollar exchange rate, in addition to those factors discussed or referenced in documents filed with Canadian securities regulatory authorities and available online at www.sedar.com.
Except as otherwise noted, all amounts are in Canadian dollars, and are based on unaudited condensed interim consolidated financial statements for the three months ended December 31, 2020 and related notes, prepared in accordance with International Financial Reporting Standards.
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