Huntingdon REIT suspends cash distributions, terminates its sales process and adopts a Unitholder rights plan

WINNIPEG, Oct. 22 /CNW/ - Huntingdon Real Estate Investment Trust ("HREIT") (TSX: HNT-UN.TO) announced today the suspension of its monthly cash distribution to Unitholders, the termination of its process to solicit proposals to acquire or merge with HREIT and the adoption of a Unitholder rights plan (the "Rights Plan").

HREIT Management and the Board of Trustees (the "Board") have determined that it is prudent to suspend the monthly cash distribution to Unitholders given the current uncertainty in the capital markets. HREIT believes that it would be more prudent to utilize its cash resources for the repayment of debt. The suspension of HREIT's $0.02333 per unit monthly cash distribution is effective for the October 2008 distribution that would have been payable in November 2008. The distribution policy will be reviewed as conditions warrant.

HREIT's Special Committee has also determined that current capital market conditions do not justify the previously announced process to solicit proposals to acquire or merge with HREIT. The Special Committee thoroughly reviewed multiple expressions of interest and non-binding purchase offers received from a variety of parties and determined that they did not offer sufficient value to Unitholders. HREIT will continue to evaluate all alternatives to maximize unitholder value and strengthen the balance sheet of HREIT.

The Board has also adopted a Rights Plan, which is effective immediately and will be in effect for a maximum of 180 days, unless otherwise approved at a meeting of Unitholders prior to the expiry date. The TSX has accepted notice of the Rights Plan, subject to, among other conditions, confirmation of the Rights Plan by HREIT's Unitholders prior to April 22, 2009. HREIT is not adopting the Rights Plan in response to any specific take-over proposal, nor has it been made aware of any such proposal.

The Rights Plan is intended to ensure that Unitholders receive fair treatment in the event of an unsolicited attempt to gain control of HREIT and, in such event, to ensure Unitholders receive full value and that the Board has time to consider alternatives to maximize Unitholder value. The Board believes that the implementation of the Rights Plan is particularly important at the present time given the volatility in the markets, the decision to suspend distributions, and the Board's view that HREIT's Units are currently undervalued.

To implement the Rights Plan, the Board has authorized the issuance of one right (a "Right") for each outstanding HREIT Unit to holders as of the close of business on October 22, 2008. The Rights will only become exercisable upon the occurrence of certain triggering events, including the acquisition by a person or group of persons of 20% or more of outstanding Units in a transaction not approved by the Board. Each Right entitles the Unitholder (other than the acquiring person or group of persons) to acquire Units at a substantial discount to the prevailing market price at the time.

The Rights will not be triggered by purchases of Units made pursuant to a "Permitted Bid" under the Rights Plan, being a bid made to all HREIT Unitholders on identical terms and which remains open for acceptance for not less than 60 days.

The Rights Plan is not intended to deter a bona fide take-over bid for HREIT under a full and fair offer. It does not affect the duty of the Board to give proper consideration to any offer that might be made, and to act in the best interests of Unitholders.

A complete copy of the Rights Plan will be filed with the applicable securities regulatory authorities and will be made available at www.sedar.com and on HREIT's website.

    
    About HREIT
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HREIT is a real estate investment trust, which is listed on the Toronto Stock Exchange under the symbols HNT.UN (Trust Units) and HNT.DB.C (Convertible Debentures). HREIT owns 79 income producing office, industrial, retail and standalone parking lot properties that have a total gross leaseable owned area of 5.4 million square feet; two land parcels held for development and other development and expansion opportunities within the existing portfolio. The properties are located in Manitoba, Ontario, Saskatchewan, Alberta, British Columbia and Northwest Territories. HREIT also owns a third party property management business. There are currently 72,589,214 trust units outstanding. For further information on HREIT, please visit our website at www.hreit.ca.

    
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Contacts

Arni Thorsteinson
President & Chief Executive Officer
or Gino Romagnoli
Investor Relations
Tel: (204) 475-9090
Fax: (204) 452-5505
Email: info@hreit.ca