An anonymous director reports

LANESBOROUGH REIT ENTERS INTO AGREEMENT TO SELL PROPERTY

Lanesborough Real Estate Investment Trust has entered into an asset purchase agreement in connection with the sale of Nelson Ridge Estates, 101 Loutit Rd., Fort McMurray, Alta., to 7254751 Manitoba Ltd. (725) for aggregate consideration of $22-million, payable as follows: (i) a $20,000 cash deposit payable to Lanesborough within three business days of the effective date of the Agreement; (ii) $14,593,259.05 through the assumption of the first mortgage on the Property by 725; (iii) $7,615,564.57 through the assumption of the second mortgage on the Property by 725; (iv) an increase in the line of credit from 2668921 Manitoba Ltd., a sister company of 725, to LREIT by $228,823.62; and (v) the balance of the purchase price payable in cash on closing.

725 is a company controlled by Arni Thorsteinson, an insider of LREIT. Accordingly, the Transaction is a "Related Party Transaction" under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101").

As LREIT is not listed on the Toronto Stock Exchange, in accordance with Section 5.5(b) of MI 61-101, the Transaction is exempt from the formal valuation requirements of MI 61-101. As LREIT is experiencing financial hardship, as defined in Section 5.5(g) of MI 61-101, LREIT is also exempt from the requirement to obtain approval of a majority of the minority unitholders of LREIT for the Transaction.

It is anticipated that the Transaction will close on or about May 1, 2024.

Pursuant to the terms of the Agreement and the policies of the TSX Venture Exchange (the "Exchange"), the closing of the Transaction is subject to the condition that 725 arrange new and restructed mortgage financing for its acquisition of the Property on terms satisfactory to 725 and the final approval of the Exchange.

ABOUT LREIT

LREIT is a real estate investment trust, which is listed on the TSX Venture Exchange under the symbol LRT.UN (Trust Units).

We seek Safe Harbor.