In Montreal, the REIT entered into an unconditional contract to acquire one 10-story and two six-story concrete buildings in the Montreal suburb of St. Laurent. The $24-million purchase price equates to $74,500 per unit, $87 per sf and an initial cap rate of 7.10%. This transaction is expected to close in mid March.

In Calgary, the company entered agreements to sell two properties. It will sell Leighton House, a 38-suite suite mid-rise building, for $4 million ($100,000 per suite and $146 per square foot), which represents a 5.4% initial cap rate. It also will sell Glamis Green, a 156-unit townhouse project, for $16.7 million, ($107,000 per suite and $96 per sf), which represents a 5.5% cap rate.

Boardwalk REIT currently owns and operates in excess of 33,000 units (28 million sf) in 260 properties, making it one of Canada's largest owner-operator of apartments. The company's portfolio is concentrated in the provinces of Alberta, British Columbia, Saskatchewan, Ontario and Quebec.

The 322 units under contract in Montreal equals about one-fourth of the 1,325 units the company acquired in 2005 at a cost of $115 million. The aggregate going-in cap rate for the acquisitions was 6.68%.

The average vacancy rate across the REIT's portfolio for the fourth quarter of 2005 was 3.73%, down from 4.54% in the third quarter of 2005, and down from 4.22% in the fourth quarter of 2004. The average monthly rent realized in fiscal 2005 was $747 per unit, an increase of $6, or 1%, from $741 per unit for the 12 months ended Dec. 31, 2004.

Commenting on future property acquisitions, the REIT's senior vice president of Corporate Development Bill Chidley says the acquisition market for apartments in Canada continues to be a highly competitive seller's market characterized by aggressive vendor expectations and compression in cap rates. "We are currently in discussion on a number of properties; however, we cannot be certain of closing on any of these transactions," he says. "While market forces are making acquisitions more difficult, cap rate compression has had a positive effect on the overall valuation of our current holdings. Cap rates, spurred by increased investor interest in Canadian multifamily real estate, are expected to decline still further, resulting in a substantial increase in our portfolio's value as we look forward."