Mr. Mike Walsh reports

LFL ANNOUNCES INTENTION TO CREATE REAL ESTATE INVESTMENT TRUST

Leon's Furniture Ltd. (LFL) intends to create a real estate investment trust (REIT), which is expected to unlock significant shareholder value while positioning the company to accelerate growth. LFL has an attractive real estate portfolio of approximately 5.2 million square feet of wholly owned real estate from which it will vend in a significant portfolio of assets to the REIT. LFL is currently exploring various strategic alternatives for the REIT transaction, which could involve an initial public offering of the REIT or a shareholder-approved spinout of the REIT to LFL shareholders. It is LFL's intention to maintain a majority ownership interest in the REIT. The timing of the transaction will be subject to prevailing market conditions and the receipt of required regulatory approvals, including approval to list the units on the Toronto Stock Exchange.

LFL expects the creation of the REIT to:

• Unlock value for LFL shareholders by surfacing the market value of the company's significant portfolio of cash-flow-generating real estate properties;
• Create a vehicle that is expected to have a cost-of-capital advantage, a built-in growth pipeline of future property vend-ins from LFL, and a management team focused on growing and optimizing the portfolio;
• Lower the cost of capital for LFL and provide capital to invest in growth opportunities.

Mike Walsh, president and chief executive officer of LFL, commented: "The creation of the REIT is expected to surface the value that is currently hidden within the company's significant real estate portfolio, while ensuring both management teams are able to execute value-maximizing strategies for shareholders. Capital that LFL receives as part of this transaction is expected to go toward growth and efficiency opportunities, including accelerating the modernization of the company's distribution centre footprint. LFL has delivered value for its customers and generated results for its shareholders over a 100-plus-year history, and I know I speak on behalf of our entire senior management team and board of directors when I say that based on the opportunities we see in front of us, it feels like we are only just beginning our journey together."

Constantine Pefanis, chief financial officer of LFL, added: "The creation of this REIT will help to ensure that optimal decisions with respect to value creation are made for all businesses currently under the LFL umbrella -- retail, ancillary businesses and real estate. Access to incremental capital will enable us to accelerate the growth of our retail footprint and invest in the optimization of our operating platform, which will help position the company for further success. The REIT will also provide LFL with ongoing access to a source of lower-cost capital for growth, while giving the REIT an embedded growth pipeline. The company's real estate portfolio is very attractive, and the REIT will have a mandate to grow and diversify the portfolio outside of the LFL network, for the benefit of all stakeholders."

The company expects that, for financial reporting purposes, the REIT will be consolidated with LFL's financial results.

About Leon's Furniture Ltd.

Leon's Furniture is the largest retailer of furniture, appliances and electronics in Canada. Its retail banners include: Leon's; The Brick; Brick Outlet; and The Brick Mattress Store. Finally, with The Brick's Midnorthern Appliance banner alongside Leon's Appliance Canada banner, this makes the company the country's largest commercial retailer of appliances to builders, developers, hotels and property management companies. The company has 304 retail stores from coast to coast in Canada under various banners.

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