Global Education Communities Corp. Subsidiary Completes Sale of GEC Granville Suites Hotel for Approximately $70 Million

Rhea-AI Summary

Global Education Communities Corp. (GECC) announces the sale of GEC Granville Suites Hotel for $70 million, a 79% increase from its initial acquisition price of $39 million in 2015. The hotel's annual revenue also grew by 79% to $8.75 million after eight years under the GEC brand, despite economic challenges and the impact of the COVID-19 pandemic. The cash proceeds will be reinvested in expanding the student-housing portfolio and other GEC projects, as the company focuses on potential acquisitions below market value.

Positive

• 79% increase in property value and annual revenue after eight years under the GEC brand
• Reinvestment of cash proceeds into expanding student-housing portfolio and potential acquisitions below market value

Negative

• Impact of the COVID-19 pandemic and challenging economic conditions

VANCOUVER, BC / ACCESSWIRE / November 28, 2023 / Global Education Communities Corp. ("GECC" or the "Company") (TSX:GEC),(OTCQX International:GECSF) is pleased to announce that GEC Granville Limited Partnership has sold GEC® Granville Suites Hotel for gross proceeds of approximately $70 million. The transaction was completed on November 28, 2023.

GEC® Granville Suites Hotel was initially acquired for $39 million plus closing costs in 2015 and generated annual revenue of $4.9 million. The original news release from 2015 is available here: https://gechq.com/blog/2015/11/19/cibt-subsidiary-expands-its-student-housing-portfolio-in-downtown-vancouver/. After eight years of management under the GEC® brand, GEC® Granville Suites Hotel's annual revenue reached $8.75 million, an increase of 79%.

The property value also increased by 79% to $70 million from $39 million, despite the impacts of the COVID-19 pandemic, which led to the border shutdown for nearly two years, inflation, rising interest rates, and other challenging economic conditions.

"We are pleased with the sale after eight years of operations," commented Toby Chu, Chairman, President and CEO of GECC. "With the sale of this asset, GECC management will focus on expanding our student-housing portfolio, allocating more resources to our GEC® Living platform (www.gecliving.com), supported by our significant educational operations, which includes Sprott Shaw College® (since 1903), Sprott Shaw Language College, and Vancouver International College. GECC's share of the cash proceeds from the transaction will be deployed to other GEC® projects. Recent real estate market conditions have presented many interesting opportunities for potential acquisitions below market value."

About GECC:

GECC is one of Canada's largest education and student housing investment companies focused on the domestic and global education market since 1994. GECC owns business and language colleges, student-centric rental apartments, recruitment centres and corporate offices at 41 locations in Canada and abroad. Its education subsidiaries include Sprott Shaw College Corp. ("SSCC") (established in 1903), Sprott Shaw Language College ("SSLC"), Vancouver International College Career Campus ("VIC") and CIBT School of Business & Technology Corp. ("CIBT China"). GECC offers over 150 educational programs in healthcare, business management, e-commerce, cyber-security, hotel management, and language training through these schools. In 2022, GECC serviced over 13,000 domestic and international students through its educational, rental housing and recruitment subsidiaries.

GECC owns Global Education City Holdings Inc. ("GECH"), an investment holding and development company focused on education-related real estate such as student-centric rental apartments, a hotel and education super-centres. Under the GEC^® brand, GECH provides accommodation services to 92 schools in Metro Vancouver, serving 3,000 students from 71 countries. The total portfolio and development budget under the GEC^® brand is nearly $1.3 billion.

GECC also owns Global Education Alliance Inc. ("GEA") and Irix Design Group Inc. ("IRIX"). GEA recruits international students for elite kindergartens, primary and secondary schools, colleges and universities in North America. Irix Design is a leading design and advertising company based in Vancouver, Canada. Visit us online and watch our corporate video at www.GEChq.com.

For more information, contact:

Toby Chu
Chairman, President & CEO
Global Education Communities Corp.

Investor Relations Contact: 1-604-871-9909 extension 319 or | Email: info@GEChq.com

FORWARD-LOOKING STATEMENTS

Some statements in this news release contain forward-looking information (the "forward-looking statements") about GECC and its plans. Forward-looking statements are statements that are not historical facts. Forward-looking statements in this news release include, without limitation, the intended use of GECC's share of the net sale proceeds from the sale of GEC® Granville Suites Hotel. The forward-looking statements are subject to various risks, uncertainties and other factors (collectively, the "Risks") that could cause GECC's actual results or achievements to differ materially from those expressed in or implied by forward-looking statements. The Risks include, without limitation, national and global economic factors, customary risks of the construction industry, unexpected delays or requirements of the applicable municipalities, and the other risk factors identified in the Company's management's discussion and analysis for the fiscal year ended August 31, 2023 (available under the Company's profile on SEDAR+ at www.sedarplus.ca) which is expected to be filed on SEDAR+ on November 29, 2023. Forward-looking statements are based on the beliefs, opinions and expectations of GECC's management at the time they are made, and GECC does not assume any obligation to update its forward-looking statements if those beliefs, opinions or expectations, or other circumstances should change, except as may be required by law.

SOURCE: Global Education Communities Corp.

View source version on accesswire.com:
https://www.accesswire.com/811090/global-education-communities-corp-subsidiary-completes-sale-of-gec-granville-suites-hotel-for-approximately-70-million

FAQ

What is the name of the company making the announcement and its ticker symbol?

The company is Global Education Communities Corp. (GECC) and its ticker symbols are TSX:GEC and OTCQX International:GECSF.

What was the initial acquisition price of GEC Granville Suites Hotel and how much was it sold for?

The hotel was initially acquired for $39 million and was sold for $70 million.

How much did the annual revenue of GEC Granville Suites Hotel grow by after eight years under the GEC brand?

The annual revenue grew by 79% to $8.75 million.

What will the cash proceeds from the sale be used for?

The cash proceeds will be reinvested in expanding the student-housing portfolio and potential acquisitions below market value.

What challenges did the company face during the ownership of GEC Granville Suites Hotel?

The company faced challenges such as the impact of the COVID-19 pandemic, border shutdown, inflation, and rising interest rates.