Melcor Reports Strong Results for Q1-13, Declares Dividend of $0.25 Per Share, Announces Special Dividend of $0.50 Per Share

Melcor Developments Ltd. (TSX:MRD), an Alberta-based real estate development
company, today reported strong results for the quarter ended March 31, 2013.
Melcor earned net income of $12.62 million or $0.42 per share (basic), an
increase of 116% over the comparable period of 2012. Revenue was $41.62 million,
an increase of 25%.


Funds from operations (FFO) per share was $0.31 in Q1-13 compared to $0.20 per
share in Q1-12. FFO per share adjusts for all non-cash earnings items included
in income such as fair value adjustments on investment properties and stock
based compensation expense. FFO is commonly used to measure performance of real
estate operations.


Brian Baker, Melcor's President and Chief Operating Officer commented on the
quarter: "The solid start to our 90th year continues the positive trend of 2012.
With a strong base of well-diversified assets, a sound financial position and
management comprised of effective leaders assisted by dedicated staff, we are
well positioned for continued growth and success."


"We remain committed to distributing profit to our shareholders and are pleased
to increase our semi-annual dividend to $0.25 per share and declare a special
dividend of $0.50 per share."


Q1-13 Highlights



--  Melcor achieved solid results in Q1-13: 
    
    --  Consolidated revenues of $41.62 million, up 25% 
        
    --  Basic earnings per share of $0.42, up 120% 
        
    --  Funds from operations of $0.31 per share, up 55% 
        
--  Revenues were higher across all divisions in Q1-13 as a result of
    increased activity and continued execution of Melcor's growth strategy. 
    
    --  The Community Development division sold 196 single-family lots (Q1-
        12: 119), sold 2.84 acres for multi-family projects (Q1-12: 8.37)
        and 16.81 acres for commercial and industrial use (Q1-12: 14.39).
        These sales resulted in revenue growth of 26% to $26.73 million. 
        
    --  The Property Development division completed two buildings totalling
        14,500 square feet in Q1-13 and recognized $2.18 million in fair
        value gains. This compares to a fair value loss of $0.10 million in
        Q1-12. These projects have been leased predominantly to well-
        recognized national and multinational tenants. 
        
    --  Leasing activity in the Investment Properties division was strong
        with portfolio-wide occupancy rates rising to 91% leading to revenue
        growth of 14% to $14.26 million. Funds from operations grew 18% to
        $8.64 million. 
        
    --  US Operations revenue grew to $6.35 million in Q1-13 as a result of
        the sale of 83 single-family lots. This transaction represents
        further evidence of the improvement in the US housing market. 
        
--  On May 1, 2013, Melcor Real Estate Investment Trust successfully
    completed an initial public offering of 8,300,000 units for gross
    proceeds of $83.00 million. On May 7, 2013, the underwriters exercised,
    in full, their over-allotment option to purchase an additional 830,000
    trust units from Melcor at a price of $10.00 per unit for gross proceeds
    of $8.30 million.
    
    The creation of Melcor REIT represents a significant milestone in the
    history of Melcor Developments. This transaction will enhance the
    business models of both companies by providing access to capital that
    will fund development projects and long-term growth plans. Melcor
    Developments will continue its participation in these assets through its
    ongoing management and ownership interest of Melcor REIT.
    
--  Melcor's Board of Directors declared a semi-annual dividend of $0.25 per
    share and a special dividend of $0.50 per share, payable on June 28,
    2013 to shareholders of record on June 14, 2013. This dividend is an
    eligible dividend for Canadian tax purposes.



Outlook

The majority of Melcor's business operations and assets remain focused on
Alberta. Alberta economic fundamentals remain strong with low unemployment
rates, net in-migration, higher than the national average weekly earnings,
strong capital investment, stabilizing inflation and relative stability in the
price of oil. These fundamentals create a favorable environment for both
residential and commercial property development.


The company continues its selective US expansion by increasing its stable of
residential rental properties, serviced lot inventory and raw development land.
These assets now comprise approximately 10% of the company's total assets in a
strengthening real estate market. With Melcor's inventory of raw and developed
land, financial resources and strong management group, the company is well
positioned to take advantage of market opportunities.


About Melcor Developments Ltd.

Melcor is a diversified real estate development and management company with a
rich heritage of integrity and innovation in real estate since 1923.


Through four integrated operating divisions, Melcor manages the full life cycle
of real estate development: from acquiring raw land, to community planning, to
construction and development, to managing leasable office, retail and
residential sites. The company develops and manages mixed- use residential
communities, business and industrial parks, office buildings, retail commercial
centres and golf courses.


Melcor's headquarters are located in Edmonton, Alberta, with regional offices
throughout Alberta and British Columbia. Company developments span western
Canada and the US. Melcor has been a public company since 1968 and trades on the
Toronto Stock Exchange (TSX:MRD).


Forward Looking Statements

In order to provide our investors with an understanding of our current results
and future prospects, our public communications often include written or verbal
forward-looking statements.


Forward-looking statements are disclosures regarding possible events,
conditions, or results of operations that are based on assumptions about future
economic conditions, courses of action and include future-oriented financial
information.


This news release and other materials filed with the Canadian securities
regulators contain statements that are forward- looking. These statements
represent Melcor's intentions, plans, expectations, and beliefs and are based on
our experience and our assessment of historical and future trends, and the
application of key assumptions relating to future events and circumstances.
Future-looking statements may involve, but are not limited to, comments with
respect to our strategic initiatives for 2013 and beyond, future development
plans and objectives, targets, expectations of the real estate, financing and
economic environments, our financial condition or the results of or outlook of
our operations.


By their nature, forward-looking statements require assumptions and involve
risks and uncertainties related to the business and general economic
environment, many beyond our control. There is significant risk that the
predictions, forecasts, valuations, conclusions or projections we make will not
prove to be accurate and that our actual results will be materially different
from targets, expectations, estimates or intentions expressed in forward-looking
statements. We caution readers of this document not to place undue reliance on
forward-looking statements. Assumptions about the performance of the Canadian
and US economies and how this performance will affect Melcor's business are
material factors we consider in determining our forward-looking statements. For
additional information regarding material risks and assumptions, please see the
discussion under Business Environment and Risk in our annual MD&A.


Readers should carefully consider these factors, as well as other uncertainties
and potential events, and the inherent uncertainty of forward-looking
statements. Except as may be required by law, we do not undertake to update any
forward- looking statement, whether written or oral, made by the company or on
its behalf.



FOR FURTHER INFORMATION PLEASE CONTACT: 
Melcor Developments Ltd.- Business Contact
Brian Baker
President & COO
780-423-6931


Melcor Developments Ltd.- Investor Relations
Jonathan Chia, CA
CFO
780-423-6931
www.melcor.ca