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TORONTO-The Calloway REIT has completed another step in its previously announced $1 billion agreement to acquire or lease interests in 16 SmartCentres properties, 14 of them anchored by Wal-Marts. The company has completed the acquisition of seven properties and has entered into long-term leases on an additional four properties, with five centers remaining under contract and scheduled to close by Dec. 31.

This latest step follows the acquisition of 11 initial properties when Calloway announced in October that it had entered into conditional agreements for the 16 properties, half of which are in the Greater Toronto Area. The 16 properties comprise nine shopping centers totaling more than 1.6 million sf and 600,000 sf of expansion potential, along with seven development properties with 1.8 million sf of potential leaseable area.

The expansion sites and development properties will be completed by Vaughan, ON-based SmartCentres under development agreements with Calloway, with all of the properties to be substantially completed over the next three to four years. The Toronto-based REIT estimates that it will invest an additional $555 million in these properties as new buildings are completed and as tenants lease new space.

The transaction also includes Calloway's purchase of part of the SmartCentres property management business that manages Calloway's shopping centers. In addition to the eight properties located in the Greater Toronto Area, the remaining properties are in the Greater Montreal Area, New Brunswick and Quebec.

In addition to the 14 centers anchored by Wal-Mart, there are five anchored by Loblaws, two by Home Depot, two each by Canadian Tire and Sobeys, and one by Rona. The development properties include a regional unenclosed center in Stouffville, ON that will comprise more than 600,000 sf on completion and is home to the first newly constructed Canadian Wal-Mart Supercenter.

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