Canadian Real Estate Investment Trust Announces Atlantic Canada Portfolio Acquisition.

TORONTO -- Canadian Real Estate Investment Trust ("CREIT") (TSX:REF.UN) announced that it will acquire a portfolio of seven commercial real estate assets and two parcels of vacant land adjacent to one of the properties, for a purchase price of $50 million (subject to adjustment).

The portfolio is comprised of four retail assets, a flex-space industrial building and a suburban, one-story, office building located in Halifax, Nova Scotia, and a flex-space industrial building located in Moncton, New Brunswick.

Stephen Johnson, President & Chief Executive Officer of CREIT said, "This portfolio fits well with our existing operations in Atlantic Canada. The bulk of the portfolio is comprised of retail properties, located in the Bayers Lake Park in Halifax, which has now evolved into the dominant retail node in Halifax."

The total portfolio contains 466,000 square feet of space which is currently 93.8% occupied.

Major tenants of the portfolio include Sears, Chapters, Empire Theatres, Bank of Montreal, St. John Naval Systems and Medmira Laboratories.

It is anticipated that the closing of five of the properties in the portfolio will occur on July 2, 2004, at a price of $41.7 million. The purchase price will be partially satisfied by the assumption of mortgage debt of $25.8 million (weighted average interest rate of 7.15% and an average term to maturity of 5.2 years). The balance of the purchase price of $15.9 million will be drawn from CREIT's existing credit facilities.

The other properties in the portfolio will close upon certain due diligence requirements being met.

The first year income in place on the portfolio is anticipated to provide an unleveraged yield of approximately 9.7% on the purchase price.

The 5-year lease expiry profile for the seven-property portfolio is outlined in the table below:

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                        Year 1   Year 2   Year 3   Year 4   Year 5
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Square footage expiry   13,601   32,047   25,034   72,644   61,398
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CREIT is a real estate investment trust that is dedicated to building wealth for its Unitholders through reliable monthly cash distributions and long-term value enhancement. CREIT owns a portfolio of more than 118 retail, industrial and office properties. Its disciplined approach manages risk while delivering attractive long-term returns.

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS 

This news release contains forward-looking statements relating to our operations and the environment in which we operate, which are based on our expectations, estimates, forecasts and projections. These statements are not future guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. We undertake no obligation to publicly update any such statement, to reflect new information or the occurrence of future events or circumstances.