YTD revenue and NOI growth of over 20% and successful execution of urban strategy with
Q4 acquisition of 1.1million square feet of high quality, Class "A" office properties
/NOT FOR DISTRIBUTION IN THE
Q4 Highlights and Key Performance Indicators
- Acquired four high quality, Class "A" office properties, three in the GTA and one in
Calgary, Alberta . The acquisitions totaled 1,146,200 square feet with a combined purchase price of approximately$395.8 million plus closing costs - On
November 18, 2019 , the REIT issued 11,638,000 Units at a price of$6.92 per Unit, including 1,518,000 Units issued on the full exercise of the over-allotment option, for aggregate gross proceeds of$80.5 million - Contractually leased and renewed 140,557 square feet with an average increase of approximately 6% over expiring rates, including a new
Alberta government tenant at13140 St. Albert Trail ,Edmonton, Alberta and an early lease renewal of a credit rated tenant at6865 Century Avenue ,Mississauga, Ontario , totaling 34,332 square feet
Three months ended | Years ended | |||
| | |||
2019 | 2018 | 2019 | 2018 | |
Number of properties | 49 | 45 | ||
Portfolio GLA | 4,836,400 sf | 3,615,050 sf | ||
Occupancy rate | 97% | 97% | ||
Remaining weighted average lease term | 4.7 years | 4.3 years | ||
Revenue from government & credit-rated tenants | 76% | 79% | ||
Revenue | ||||
NOI | 17,122 | 14,441 | 62,065 | 51,307 |
Net income and comprehensive income | 1,425 | 19,663 | 24,178 | 49,620 |
Same Property NOI | 14,626 | 14,349 | 45,618 | 45,056 |
Same Property NOI growth | 1.9% | (1.6%) | 1.2% | (2.5%) |
FFO | ||||
FFO per Unit - Basic | 0.14 | 0.14 | 0.58 | 0.57 |
FFO per Unit - Diluted | 0.14 | 0.14 | 0.57 | 0.57 |
AFFO | ||||
AFFO per Unit - Basic | 0.13 | 0.14 | 0.57 | 0.57 |
AFFO per Unit - Diluted | 0.13 | 0.14 | 0.56 | 0.57 |
AFFO payout ratio - Diluted | 112% | 107% | 106% | 105% |
Distributions declared |
Results were negatively impacted due to the timing differential between the September and
Q4 2019 | YTD 2019 | |||
Excluding timing differential dilution | ||||
FFO per Unit - Basic | $ | 0.16 | $ | 0.61 |
FFO per Unit - Diluted | 0.15 | 0.60 | ||
AFFO payout ratio - Basic | $ | 0.15 | $ | 0.59 |
AFFO payout ratio - Diluted | 0.15 | 0.58 | ||
AFFO payout ratio - Diluted | 98% | 102% |
Year-to-date ("YTD") Highlights
- Acquired five office properties, three in the GTA, one in
Ottawa, Ontario and one inCalgary, Alberta , totaling 1,253,300 square feet for an aggregate purchase price of$420.3 million plus closing costs - On
July 25, 2019 , the REIT disposed of a 35,200 square foot property inLondon, Ontario for a sale price of$8,700 - Completed two Unit offerings totaling 23,839,500 Units for aggregate gross proceeds of
$161 million - Contractually leased and renewed 394,479 square feet with an average lease term of 4.9 years and an average increase of approximately 8% over expiring rates
Operating Results
The REIT increased its portfolio in 2019 by 1,218,100 square feet. Revenue and operating costs increased 18% to
Government and credit-rated tenants account for 35% and 41%, respectively or 76% combined, of the REIT's annualized gross revenue. As at
Same Property Results
| |||||||||||
Occupancy | 2019 | 2018 | NOI | Q4 2019 | Q4 2018 | Variance | Variance % | ||||
91.4% | 97.8% | $ | 2,080 | $ | 2,023 | 57 | 2.8% | ||||
100.0% | 100.0% | 762 | 723 | 39 | 5.4% | ||||||
90.8% | 91.1% | 1,188 | 1,130 | 58 | 5.1% | ||||||
92.4% | 96.0% | 1,568 | 1,476 | 92 | 6.2% | ||||||
98.6% | 97.2% | 9,028 | 8,997 | 31 | 0.3% | ||||||
Total | 96.0% | 96.4% | $ | 14,626 | $ | 14,349 | $ | 277 | 1.9% |
QTD and YTD 2019 Same Property NOI increased 1.9% and 1.2%, respectively, compared to the same period in 2018. Excluding termination payments, project management fees and short term lease rental revenue, Same Property NOI increased by 1.5% and 1.1% in the quarter and year to date, respectively.
The Alberta Same Property NOI increase is due to termination payments received in 2019, which coincides with the decrease in occupancy. 10,368 square feet of the 39,549 square feet currently vacant has been leased to the Province of
Same Property NOI growth in
Excluding project management fees, Same Property NOI for the
Debt
Indebtedness to GBV Ratio | 57.6% | 56.5% |
Interest coverage ratio | 3.01x | 3.19x |
Indebtedness - weighted average fixed interest rate | 3.38% | 3.41% |
Indebtedness - weighted average term to maturity | 3.87 years | 3.85 years |
As at
As at
About the REIT
The REIT is an unincorporated, open-ended real estate investment trust established under the laws of the Province of
The REIT is focused on growing its portfolio principally through acquisitions across
Non-IFRS measures
Certain terms used in this press release such as funds from operations ("FFO"), adjusted funds from operations ("AFFO"), net operating income ("NOI"), same property net operating income ("Same Property NOI"), indebtedness ("Indebtedness"), gross book value ("GBV"), Indebtedness to GBV ratio, net earnings before interest, tax, depreciation and amortization and fair value gain (loss) on financial instruments and investment properties ("Adjusted EBITDA"), interest coverage ratio, and adjusted cash provided by operating activities are not measures defined by International Financial Reporting Standards ("IFRS") as prescribed by the
Forward-looking Statements
Certain statements contained in this press release constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking statements are provided for the purposes of assisting the reader in understanding the REIT's financial performance, financial position and cash flows as at and for the periods ended on certain dates and to present information about management's current expectations and plans relating to the future. Readers are cautioned such statements may not be appropriate for other purposes. Forward-looking information may relate to future results, performance, achievements, events, prospects or opportunities for the REIT or the real estate industry and may include statements regarding the financial position, business strategy, budgets, projected costs, capital expenditures, financial results, taxes, plans and objectives of or involving the REIT. In some cases, forward-looking information can be identified by such terms as "may", "might", "will", "could", "should", "would", "expect", "plan", "anticipate", "believe", "intend", "seek", "aim", "estimate", "target", "goal", "project", "predict", "forecast", "potential", "continue", "likely", or the negative thereof or other similar expressions suggesting future outcomes or events.
Forward-looking statements involve known and unknown risks and uncertainties, which may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, assumptions may not be correct and objectives, strategic goals and priorities may not be achieved. A variety of factors, many of which are beyond the REIT's control, affect the operations, performance and results of the REIT and its business, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results. These factors include, but are not limited to, risks related to the trust units of the REIT ("Units") and risks related to the REIT and its business. See "Risks and Uncertainties" included in the REIT's AIF and MD&A. The reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking statements as there can be no assurance actual results will be consistent with such forward-looking statements.
Information contained in forward-looking statements is based upon certain material assumptions applied in drawing a conclusion or making a forecast or projection, including management's perception of historical trends, current conditions and expected future developments, as well as other considerations believed to be appropriate in the circumstances, including the following: the Canadian economy will remain stable over the next 12 months; inflation will remain relatively low; interest rates will remain relatively stable; conditions within the real estate market, including competition for acquisitions, will be consistent with the current climate; the Canadian capital markets will provide the REIT with access to equity and/or debt at reasonable rates when required;
The forward-looking statements made relate only to events or information as of the date on which the statements are made in this press release. Except as specifically required by applicable Canadian law, the REIT undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.
SOURCE
© Canada Newswire, source