C.A. Bancorp Inc. (TSX: BKP) Announces Closing of a $1.2 Million Follow-on Mortgage Investment in the Kingswood Apartment Complex in Kitchener, Ontario

TORONTO, ONTARIO -- C.A. Bancorp Inc. (“C.A. Bancorp”) (TSX:BKP) is pleased to announce that it has closed a $1.2 million follow-on interest yielding mortgage investment in Kingswood Drive Kitchener Limited Partnership (the “Partnership”). The Partnership owns a 360 unit Kingswood Apartment Complex (“Kingswood”) located in Kitchener, Ontario. C.A. Bancorp owns a 80% limited partnership interest in the Partnership, Centurion Apartment Properties Limited Partnership (“Centurion L.P.”) holds 10%, and the remaining 10% is held by an outside institutional investor, all on a pari-passu basis. C.A. Bancorp’s 80% limited partnership interest was purchased for $6.0 million. C.A. Bancorp’s $1.2 million mortgage investment is being matched on a proportionate basis by the other two limited partners ($150,000 each). The total $1.5 million in mortgage proceeds will be utilized by the Partnership to refinance existing debt and to fund future unit upgrades and yields an interest rate of 10%.

Property Description
The Kingswood Property is a freehold interest in eight garden-style apartment buildings on 16 acres of land, with an average of 45 units per building, located on Kingsway Drive in Kitchener, Ontario. The Kingswood Property is strategically located in the south end of Kitchener with excellent access to Highway 401, Highway 8, and the Conestoga Parkway. The buildings are comprised of one and two bedroom units and are presently over 98% leased. The Kingswood Property is managed by Centurion Property Associates Inc (the “Manager”), a property management company related to Centurion L.P., which currently manages 1,179 apartment units in 23 locations throughout southern Ontario.

Original Investment Thesis
The investment thesis with respect to the Kingswood property was to increase net operating income by (i) physically upgrading individual apartments and increasing rents; (ii) reducing operating costs through strategic capital expenditures to increase energy efficiency; and, (iii) converting the apartment buildings to condominiums.

Progress to Date
The Manager has recently been successful in obtaining draft plan condominium approval from the City of Kitchener. If implemented, the conversion from apartment to condominium title will enhance liquidity of the units constituting the Kingswood property. In addition, the Manager has upgraded over 42% of the individual apartment units resulting in increased rents while reducing operating costs.

Centurion Apartment Properties Limited Partnership
Centurion Apartment Properties Limited Partnership presently owns 1,179 apartment units in Ontario and is focused on the acquisition and management of apartment properties located in Canada.

C.A. Bancorp Inc.
C.A. Bancorp is a publicly traded Canadian merchant bank and alternative asset manager that provides investors with access to a range of private equity and other alternative asset class investment opportunities. C.A. Bancorp is focused on investments in small- and middle-capitalization public and private companies, with emphasis on the industrials, real estate, infrastructure and financial services sectors.

This news release contains forward-looking statements. These statements relate to anticipated future events, results, circumstances, performance or expectations that are not historical facts but instead represent C.A. Bancorp’s beliefs regarding future events. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forward-looking statements are based on a number of assumptions which may prove to be incorrect. These cautionary statements qualify all forward-looking statements attributable to C.A. Bancorp and persons acting on its behalf relating to the subject matter of this press release. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release. C.A. Bancorp does not undertake, and specifically disclaims, any intention or obligation to update or revise any of such forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.