Welcome to the first electronic edition of our newsletter, of Capital Interest. Some of you were loyal subscribers to our printed edition that was discontinued last summer and for others this will be your first introduction to the newsletter. Due to comments from some of the previous subscribers, we have decided to continue with the newsletter. However, it will now only be available by email. The newsletter will attempt to briefly summarize the real estate news and sales from the previous month. I will try to send it out on the first Monday of the month (I know this one is already three days late). I also welcome your comments and suggestions. If any agents wish to to have any of their listings mentioned in the newsletter, please forward the information to us.

SALES

The major Office Transactions for the months of August and September 1999 were as follows:

Holland Cross is an office/retail complex of some 275,000 square feet located across from Tunney's Pasture at the corner of Scott and Holland. It was sold by RHK Capital to I.F. Propco Holdings for $28,000,000 or $102 per square foot of leasable area. The sale closed on August 11, 1999.

1 Antares Drive is a Class "A" suburban office building in the south end of the City of Nepean. It was acquired by Dundee from Colonnade Developments for $7,825,000 or $110 per square foot on September 8, 1999.

2060 Walkley is an older two and one-storey industrial/office building located east of Conroy Road in the Ottawa Business Park. The property was sold by Royal Trust to Walkley Properties Ltd. for $1,550,000 or some $51 per square foot. The building is leased to one tenant for another eight years. The sale closed on August 31, 1999.

Two office buildings at 280 and 294 Albert Street were sold by the Manufactures Life Insurance Company to a company out of Montreal on September 1, 1999. The properties sold for $2,450,000 or approximately $20 per square foot of building area. These are older buildings that had high vacancy at the time of sale. Roger Casagrande of jj Barnicke was the agent.

The former La Cite College building at 2445 St. Laurent Boulevard has finally been leased and sold. The building is 149,370 square feet in size including the two lower basement levels that have an area of 60,917 square feet. The whole building was leased to JDS Uniphase (I should have bought the stock) for a five year term. The building was sold by Canada Life Assurance Company to a numbered company that is RT Properties. The sale price was $9,900,000. This is equal to $66 per square foot of total building area or $112 per square foot above grade.

The one storey industrial/office building across from 2445 St. Laurent was also purchased by RT Properties. This was sold under power of sale by the Royal Bank for $1,750,000 or $56 per square foot. The purchase price reflects the value of an empty building. However, the buidling was fully leased to Med Eng prior to closing. This sale closed August 6, 1999.

There were only two major RETAIL TRANSACTIONS during August and September. One of them was the Truscan's plaza at 1556 Merivale Road for $1,450,000 or $144 per square foot. This plaza was fully leased at the time of sale to a number of tenants. The real estate agent on this sale was John Seymour of Colliers.

The other retail transaction was the purchase by Loblaws Properties Limited of the Robinson Plaza on Merivale Road from K.D.R. Holdings Limited for $8,750,000. This sale was done direct between the parties.

Manulife sold their downtown core COMMERCIAL SITE at 199 Slater for $1,100,000 or $48.46/sq.ft. They acquired the site in 1990 for $8,500,000. Now that is a time adjustment!

Claridge purchased some 22 acres of RESIDENTIAL LAND in the Bridlewood community of Kanata for approximately $112,000/acre.

Minto Land Development purchased 112 acres of future residential development land from Queenswood Land Associates on the east side of Tenth Line Road, south of Innes Road in Cumberland. The sale price was $3,900,000 or $34,688 per acre.

Manulife sold the land under the Juliana Apartments on September 1, 1999 to the owners of the apartment building. The sale price was $1,125,000 or $38.95 per square foot of site area or $13,720 per unit.

Oxford Properties Group purchased an INDUSTRIAL BUILDING of some 43,000 square feet located at 180-200 Terrence Matthews Crescent in the Kanata South Business on September 24, 1999 for $2,300,000 or $53 per square foot. The property previously sold in April 1995 for $1,694,818. This transaction may or may not be arms length.

There were no major APARTMENT BUILDING TRANSACTIONS in Aug./Sept 1999.

NEWS

Nortel has announced they will be constructing a 150,000 square foot chip plant on 17 acres of land on the north side of Palladium Drive in the City of Kanata. The site is owned by CIBC and managed by Colonnade Developments. The plant is to be ready for production by next summer.

Entrust has choosen the Canderel NorthTech Business Park off of Hines Road in the Kanata North Business Park for their new offices. The offices are to be open by the end of 2000 and will be between 120,000 and 140,000 square feet in size.

The third quarter office survey from BOMA and prepared by jj Barnicke indicates the overall vacancy rate including space for sublet in the Ottawa region is at 8.2%. This is slighlty higher than the third quarter of 1998 when the vacancy rate was at 8.0%. A small surprise was that the best performing market is not in the west end but rather the Gloucester office market with a vacancy rate of only 4.8%. The Class "A" market in Gloucester is much lower at 1.3%.

New home sales are up 24% from last year as at the end of October. CMHC is predicting housing construcution will be at almost 4,400 units which is an increase of 21% over 1998. They are also projecting an increase of 13% for 2000 to 5,000 units.