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CHC Realty Capital Corp. Completes First Closing of Private Placement

V.CHC

TORONTO, ONTARIO--(Marketwired - Aug. 20, 2014) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

CHC Realty Capital Corp. ("CHC" or the "Company") (TSX VENTURE:CHC) wishes to announce that it has completed the first tranche of its previously announced non-brokered private placement effective August 18, 2014 through the issuance of 53,038,699 subscription receipts for gross proceeds of $5,834,257.

The Company has received conditional approval from the TSX Venture Exchange (the "TSXV") for the issuance of up to 72,727,272 subscription receipts for gross proceeds of $8.0 million under the private placement, and CHC expects to complete a final closing for the balance of the placement on or before August 29, 2014. Closing of the private placement, including this first tranche, is subject to final acceptance from the TSXV. In connection with the closing of this first tranche of the placement, the Company paid a total of $37,604 in finder's fees to certain investment dealers who introduced subscribers to the Company.

As previously disclosed, CHC intends to use the net proceeds of the private placement to complete the Company's proposed acquisitions of student housing properties in Windsor, Ontario and Trois-Rivières, Québec, and for general corporate purposes. As a result of its due diligence investigations in connection with the acquisitions, CHC has determined to proceed with the larger acquisition in Windsor, Ontario (117 beds in 87 student apartments in two buildings having a purchase price of $5.9 million) and has therefore removed its due diligence condition in respect of the acquisition and paid the vendor the additional $200,000 non-refundable (subject to certain exceptions) deposit required to be paid upon such event. CHC has also determined not to proceed with the second, smaller acquisition in Windsor, Ontario (51 beds in 32 student apartments in one building having a purchase price of $1.6 million) and has therefore terminated that transaction. The Company's due diligence period in respect of the Trois-Rivières, Québec acquisition (310 beds in 78 student apartments in six building complexes having a purchase price of $5.5 million) is ongoing. Of the combined $11.4 million purchase price for the two properties, the Company expects to pay approximately $4.65 million in cash (not including closing costs), with the balance to be satisfied through mortgage financing. The acquisitions remain subject to approval by the TSXV.

The proceeds from this first tranche of the private placement, less the finder's fees paid in connection with the closing and the amount of $600,000, which has been retained by CHC to fund the second deposits paid or to be paid to the vendors in connection with the two acquisitions in Windsor and Trois-Rivières, were deposited in escrow on closing. The funds held in escrow will be released to CHC and each subscription receipt will automatically convert into one common share of the Company without payment of additional consideration immediately prior to the completion of the acquisitions. If the escrow release conditions are not satisfied on or before October 31, 2014, the proceeds will be returned to subscribers. In addition, if one of the acquisitions is not to be completed, the funds required for it will be returned to subscribers.

All of the subscription receipts issued in this first tranche of the private placement, as well as the underlying shares issuable upon the exercise thereof, are subject to statutory resale restrictions expiring on December 19, 2014.

The securities described herein have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States unless registered under the Act or unless an exemption from registration is available.

About CHC Realty Capital Corp.

CHC Realty Capital Corp. is an owner and operator of student housing properties which is focused on acquiring high quality properties in close proximity to universities and colleges in primary and well understood secondary markets in Canada.

Cautions Regarding Future Plans and Forward-Looking Information

This press release contains forward-looking information within the meaning of Canadian securities laws. Such information includes, without limitation, information regarding the completion of the proposed transaction and the business strategies of CHC. Although CHC believes that such information is reasonable, it can give no assurance that such expectations will prove to be correct. Forward looking information is typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. CHC cautions investors that any forward-looking information provided by CHC is not a guarantee of future results or performance, and that actual results may differ materially from those in forward looking information as a result of various factors, including, but not limited to: CHC's ability to complete the proposed transactions; the state of the real estate sector in the event the proposed transactions are completed; recent market volatility; CHC's ability to secure the necessary mortgage financing or to be fully able to implement its business strategies; and other risks and factors that CHC is unaware of at this time. The reader is referred to CHC's initial public offering prospectus and other continuous disclosure documents for a more complete discussion of risk factors relating to CHC and their potential effects, copies of which may be accessed through CHC's profile on SEDAR at www.sedar.com.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there by any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

The TSXV has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

Mark Hansen, President and Chief Executive Officer
CHC Realty Capital Corp.
Telephone: (647) 288-9355
Email: mhansen@chcrealty.ca

Robert Waxman, Chief Financial Officer
CHC Realty Capital Corp.
Telephone: (647) 288-9375
Email: rwaxman@chcrealty.ca


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