Boston Development Closes Major Transaction

Business Wire, Oct 3, 1997

CALGARY, ALBERTA--(BUSINESS WIRE)--Oct. 3, 1997-- Boston(Alberta Stock Exchange: BTN. ) Boston Development Corp. ("Boston"), trading on The Alberta Stock Exchange (the "ASE") under the stock symbol "BTN" announces that subject to filing of final documentation with the ASE, it closed its Major Transaction on October 1, 1997 and has entered into an agreement to acquire a multi-family rental property for a purchase price of $4,750,000.

The Major Transaction involved the acquisition of seven real estate properties located in Alberta, Saskatchewan and Manitoba consisting of four multi-family rental properties containing an aggregate of 266 suites, a 33,000 square foot land assembly consisting of 6 rental houses, a 55,000 square foot office/warehouse and 74 units in a 156 unit, 17 storey high rise condominium conversion, the discharge of second mortgages registered against certain of the properties and a private placement for the sum of $497,691 in consideration for the issuance of 16,699,362 Common Shares and share purchase warrants to acquire an additional 3,772,572 Common Shares. Each share purchase warrant is exercisable for a period of two years at a price of $1.25 per Common Share.

Boston has also entered into an arm's length agreement to purchase a 210 suite rental property located in Winnipeg, Manitoba for a purchase price of $4,750,000. The acquisition is to close on October 31, 1997 and will be financed with a new first mortgage of $4,170,000 at a current interest rate of 4.75 percent.

Winnipeg is the capital of Manitoba and that province's largest city. The property is located in the Fort Garry community within the neighbourhood of the Pembina Strip and is in close proximity to shopping, public transit, educational and recreational facilities. The property was purchased at an 11 percent capitalization rate based on a 15 percent vacancy rate. A capital improvement program was implemented to upgrade and renovate suites. In addition, a rental program initiated to lease up suites has resulted in a vacancy rate of 6.6 percent for October 1997, significantly enhancing the cash flows and value of the property. An independent appraisal has valued the property at $4,900,000.

Boston views the acquisition as another quality addition to its portfolio in a market experiencing decreasing vacancy levels and historically low interest rates. On closing, the acquisition will have immediate positive impact on Boston's cash flow. Boston will continue to seek acquisitions throughout Canada to fulfill its growth strategy.

Boston Development Corp.'s mission is to acquire, develop and enhance value in residential and commercial real estate properties. It is focused on growth, value creation and a solid investment return. Boston operates in the areas of multi-family rental properties, condominium conversions, commercial properties and property development.

The Alberta Stock Exchange has neither approved nor disapproved the information contained herein.

CONTACT: Boston Development Corp.

Neil Evans, 306/955-6012 or 403/209-0312

306/955-3446 (FAX)