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TORONTO, Jan. 4, 2022 /CNW/ - Nova Net Lease REIT ("NOVA" or the "REIT") (CSE: NNL.U) is pleased to announce that it has completed its initial public offering of 3,167,478 trust units (the "Units") at a price of US$1.25 per Unit (the "Offering"). The Offering raised gross proceeds of approximately US$4.0 million. The Units will begin trading on the Canadian Securities Exchange today under the symbol "NNL.U".

"The closing of the Offering marks a significant milestone for the REIT and is a big step towards us establishing a platform to leverage our first-mover advantage as the only Canadian publicly listed REIT exclusively addressing US regulated cannabis real estate. Our platform will deliver investors an opportunity to provide capital to the accelerating U.S. cannabis market, which we believe to be underserved" commented Richard Michaeloff, CEO, President and Trustee of the REIT. "With a number of potential acquisitions identified that, in aggregate, are valued at over US$1 billion with cap rates between 10% and 13%, a management team and board with a demonstrated track record, and access to the public markets, we believe we are well positioned in the sector" he added.

The REIT has been formed to acquire specialized industrial and retail properties leased to experienced, top-tier, creditworthy state-licensed operators for their Regulated Cannabis facilities ("Licensed Facilities") in the United States. The REIT intends to acquire properties through sale-leaseback transactions and lease such properties on a triple net lease basis for a targeted 10 to 15 year term and strives to negotiate annual rental rate increases in the leases. The REIT's portfolio will consist of only Licensed Facilities in the United States with a targeted mix of 80% cultivation/grow/processing facilities and 20% retail/dispensary. The REIT is internally managed by a vertically integrated team of seasoned real estate and cannabis professionals with expertise across the spectrum of real estate investment management, including: acquisitions, underwriting, financing, asset management, property management, operations, development and redevelopment, accounting, regulatory affairs and marketing. The REIT will use the net proceeds of the Offering to fund transaction costs associated with the Closing and for general working capital purposes. The proceeds received by the REIT on the exercise of the Over-Allotment Option, to the extent exercised, will be used by the REIT for general working capital purposes. None of the net proceeds from the Offering will be deployed by the REIT to acquire Licensed Facilities.

The Offering was underwritten by a syndicate led by Canaccord Genuity Corp., and including Echelon Wealth Partners Inc. and Haywood Securities Inc. (collectively, the "Agents"). The REIT has granted to the Agents an over-allotment option, exercisable in whole or in part at any time for a period of 30 days following the closing of the Offering, to purchase up to an additional 15% of the Offered Units at the Offering Price.

Goodmans LLP, is acting as Canadian counsel to the REIT and Hodgson Russ LLP and Reed Smith LLP, are acting as U.S. counsel to the REIT. Blake, Cassels & Graydon LLP is acting as Canadian counsel to the Agents and Saul Ewing Arnstein & Lehr, LLP is acting as U.S. counsel to the Agents.

Financial Advisor

Novus Merchant Partners acted as exclusive financial advisor to Nova Net Lease REIT.

No securities regulatory authority has either approved or disapproved the contents of this news release. The Units have not been and will not be registered under the United States Securities Act of 1933 (the "U.S. Securities Act"), as amended, or any state securities laws, and may not be offered, sold or delivered, directly or indirectly, in the United States or to, or for the account or benefit of, "U.S. persons" (as defined in Regulation S under the U.S. Securities Act, as amended) except pursuant to certain exemptions from the registrations requirements of the U.S. Securities Act and applicable state securities laws. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the Units in the United States or to, or for the account or benefit of, U.S. persons.

Forward-Looking Statements

This press release contains statements that include forward-looking information within the meaning of Canadian securities laws. These forward-looking statements reflect the current expectations of the REIT regarding future events, including statements concerning the ability of the REIT to achieve its stated investment objectives, any future acquisitions and the future success of the platform. In some cases, forward-looking statements can be identified by terms such as "may", "will", "could", "occur", "expect", "anticipate", "believe", "intend", "estimate", "target", "project", "predict", "forecast", "continue", or the negative thereof or other similar expressions concerning matters that are not historical facts.

These statements are not guarantees of future performance and undue reliance should not be placed on them. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause actual performance and financial results in future periods to differ materially from any result expressed or implied by such forward-looking statements, including the risk factors set forth in the Prospectus under the heading "Risk Factors".

Although forward-looking statements contained in this press release are based upon what management of NOVA believes are reasonable assumptions, there can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. NOVA undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements.

SOURCE Nova Net Lease REIT

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