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PIRET Chief Executive Jumps to Granite

Kevan Gorrie Moving to Competitor After Leading Pure Industrial REIT Through $3.8 Billion Deal with Blackstone/Ivanhoé Cambridge
June 4, 2018
Pictured: Kevan Gorrie, the newly named CEO of Granite REIT.

Kevan Gorrie, the chief executive who led Pure Industrial Real Estate Trust through its $3.8 billion sale last month to Blackstone Property Partners and Ivanhoé Cambridge, is moving on to take the same post at Granite REIT.

Toronto-based Granite said Gorrie would start Aug. 1, 2018, following his approval Monday by the real estate investment trust's board of trustees. Gorrie will replace Michael Forsayeth as CEO, who had previously announced plans to retire effective in September 2018.

Granite, which owns approximately 34 million square feet of primarily industrial, warehouse and logistics properties in North America and Europe, is in the process of diversifying its tenant base away Magna International. Formerly known as MI Developments, Granite was created to hold the real estate of the global auto parts manufacturer, but the REIT expects to reduce its total lease exposure to Magna to 52 percent based on gross leasable area.

Just last month, the industrial REIT announced a US$232.5 million deal to acquire four single-tenant buildings near Columbus, Ohio, as it further reduced its exposure to Magna.

"The board unanimously selected Kevan, a proven leader and real estate professional, who brings a broad range of experience in both Canada and the United States in all aspects of the industrial asset class, including strategy, capital allocation, asset management, acquisitions, dispositions and development," said Kelly Marshall, Granite's chairman, in a statement announcing the new hire. "His extensive experience in industrial real estate, including logistics and e-commerce applications, makes him a great fit for Granite."

"Kevan will build upon recent initiatives undertaken at Granite of divesting approximately $391 million of primarily Magna-tenanted properties, including $327 million of special purpose properties, and acquiring approximately $545 million of new logistics-oriented distribution centres. Kevan's appointment will mark the next chapter in Granite's strategic plan," Marshall added.

Michael Markidis, an analyst with Desjardins Capital Markets, said hiring Gorrie would have a positive impact on Granite, following his successful track record of expanding Pure Industrial's portfolio through a series of acquisitions to more than 25 million square feet across Canada and the United States before its sale last month.

"Gorrie is well-known in both the real estate community and capital markets," said Markidis. "During this five-plus-year tenure, he established a solid track record on not only the acquisition but also the disposition front, and transformed (PIRET) from a small cap into an entity which was broadly owned by institutional investors.

"Given Granite's unique asset base, single-tenant concentration and inefficient capital structure (abnormally low leverage), we believe his skill set will benefit GRT investors over the long term," added Markidis.

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