CAPREIT Reports Continued Growth and Strong Operating Performance in Second Quarter of 2016
(firmenpresse) - TORONTO, ONTARIO -- (Marketwired) -- 08/09/16 -- Canadian Apartment Properties Real Estate Investment Trust ("CAPREIT") (TSX: CAR.UN) announced today solid portfolio growth and strong operating and financial results for the three and six months ended June 30, 2016.
"We continue to combine strong organic growth through stable high occupancies, increasing monthly rents and efficient property operations with accretive acquisitions that increase and diversify our revenues streams and strengthen our asset base," commented Thomas Schwartz, President and CEO. "Our portfolio growth so far this year has enhanced our presence in key target markets and will make a solid and growing contribution to our performance going forward through the increase in our size and scale and our ability to capture operating synergies at these new properties."
Operating Revenues
For the three and six months ended June 30, 2016, total operating revenues increased by 12.6% and 12.8%, respectively, compared to the same periods last year primarily due to the contribution from acquisitions, higher same property average monthly rents, and continuing strong occupancies. For the three and six months ended June 30, 2016, ancillary revenues, such as parking, laundry and antenna income, as a percentage of total operating revenues were 5.3% and 5.3%, respectively, compared to 5.6% and 5.4%, for the same periods last year.
CAPREIT's annualized net rental revenue run-rate as at June 30, 2016 increased to $576.2 million, up 16.4% from $494.8 million as at June 30, 2015 primarily due to acquisitions completed within the last twelve months and strong increases in average monthly rents on properties owned prior to June 30, 2015. Net rental revenue run-rate net of dispositions for the twelve months ended June 30, 2016 was $536.9 million (2015 - $483.1 million).
Overall average monthly rents for the stabilized residential suite portfolio (properties owned prior to June 30, 2015) increased 1.9% to $1,109 at June 30, 2016 from $1,088 at June 30, 2015. The increases were due primarily to a combination of ongoing successful sales and marketing strategies, above guideline rent increases, and continued strength in the residential rental sector in the majority of CAPREIT's regional markets. Occupancy for the stabilized residential suite portfolio increased to 98.2% as at June 30, 2016 compared to 98.0% for the same period last year.
For the MHC land lease portfolio, average monthly rents increased to $372 as at June 30, 2016, compared to $360 as at June 30, 2015 while occupancy remained strong at 98.3% compared to 99.0% for the same period last year. Management believes MHC land lease sites provide secure and stable cash flows due to long-term tenancies, high occupancies, steady increases in average monthly rents, and significantly lower capital and maintenance costs.
Suite turnovers in the residential suite portfolio (excluding co-ownerships) during the three months ended June 30, 2016 resulted in average monthly rent increasing by approximately $7 or 0.6% per suite compared to an increase of approximately $21 or 1.9% in the same period last year. For the six months ended June 30, 2016, suite turnovers resulted in average monthly rent decreasing by approximately $7 or 0.7% compared to an increase of approximately $17 or 1.5% in the same period last year primarily due to strategically reduced rents in the Alberta and Saskatchewan rental markets to increase occupancy and higher unit turnover than in previous years, offset by the strong rental markets of British Columbia and Ontario.
During 2016, Management made a strategic decision to reduce rents in Alberta and Saskatchewan in order to increase occupancies and reduce turnovers in these regions. Alberta and Saskatchewan have been facing increased pressure due to low energy prices resulting in a weaker economy in these regions than in the rest of Canada. Not including Alberta and Saskatchewan, average monthly rents increased strongly by approximately $34 or 3.1% and $34 or 3.2%, for the three and six months ended June 30, 2016, respectively, compared to an increase of $27 or 2.5% and $22 or 2.1% respectively for the same period last year, primarily due to the strong rental markets of British Columbia and Ontario.
Pursuant to Management's focus on increasing overall portfolio rents for the three months ended June 30, 2016 average monthly rents on lease renewals increased by approximately $20 or 1.9% per suite compared to an increase of approximately $22 or 2.0% for the same period last year. For the six months ended June 30, 2016, average monthly rents on lease renewals increased by approximately $22 or 2.0%, compared to an increase of approximately $23 or 2.1% for the same period last year. The lower rate of growth in average monthly rents on lease renewals during the period is due primarily to the strategically reduced rents in Alberta to increase occupancy, offset by higher guideline increases for 2016 (Ontario - 2.0%, British Columbia - 2.9%), compared to the permitted guideline increases in 2015 (Ontario - 1.6%, British Columbia - 2.5%), and by increases due to above guideline increases ("AGI") achieved in Ontario. Increased portfolio diversification helped mitigate geographical risk in particular areas of Canada. Management continues to pursue applications in Ontario for AGIs where it believes increases above the annual guideline are supported by market conditions to raise average monthly rents on lease renewals. For 2017, the permitted guideline increase in Ontario has been set to 1.5%.
Operating Expenses
Overall operating expenses as a percentage of operating revenues increased to 37.9% and 40.0%, respectively, for the three and six months ended June 30, 2016 compared to 37.6% and 39.8%, respectively, for the same periods last year, due to higher utility costs for the three months ended June 30, 2016, and higher R&M expenditures and wages for the six months ended June 30, 2016.
Net Operating Income
For the three months ended June 30, 2016, NOI increased by $9.8 million or 12.1%, and the NOI margin remained strong at 62.1% compared to 62.4% for the same period last year. For the six months ended June 30, 2016, NOI increased by $19.4 million or 12.4%, and the NOI margin remained strong at 60.0% compared to 60.2% last year.
For the three and six months ended June 30, 2016, operating revenues for stabilized suites and sites increased 1.4% and 1.8% respectively, while operating expenses increased 1.8% and 1.7%, respectively, compared to the same periods last year. As a result, for the three and six months ended June 30, 2016, stabilized NOI increased by 1.1% and 1.8%, respectively, compared to the same periods last year, showing the positive effects of CAPREIT's geographic diversification across Canada and proven property management programs.
NON-IFRS FINANCIAL MEASURES
For the six months ended June 30, 2016, basic NFFO per Unit increased by 3.3% compared to the same period last year despite the approximate 12% increase in the weighted average number of Units outstanding due to successful equity offerings completed in March 2015 and October 2015. For the three months ended June 30, 2016, basic NFFO per Unit increased by 3.2% compared to the same period last year despite the approximate 10% increase in the weighted average number of Units outstanding.
LIQUIDITY AND LEVERAGE
Financial Strength
Management believes CAPREIT's strong balance sheet and liquidity position will enable it to continue to take advantage of acquisition and property capital investment opportunities over the long term.
CAPREIT is achieving its financing goals as demonstrated by the following key indicators:
Property Capital Investments
During the six months ended June 30, 2016, CAPREIT made property capital investments (excluding disposed properties, head office assets, tenant improvements and signage) of $70.7 million as compared to $58.2 million in the same period last year. For the full 2016 year, CAPREIT expects to complete property capital investments of approximately $170 million to $180 million, including approximately $92 million targeted at acquisitions completed since January 1, 2011, and approximately $21 million in high-efficiency boilers and other energy-saving initiatives.
Property capital investments include suite improvements, common areas and equipment, which generally tend to increase NOI more quickly. CAPREIT also continues to invest in energy-saving initiatives, including boilers, energy-efficient lighting systems, and water-saving programs, which permit CAPREIT to mitigate potentially higher increases in utility and R&M costs and significantly improve overall portfolio NOI.
Subsequent Events
On July 27, 2016, CAPREIT completed the disposition of a mid-tier property consisting 145 apartment suites located in Montreal, Quebec for a sale price of approximately $25.0 million and a mortgage assumed by the purchaser of approximately $12.1 million with a term to maturity of March 2025 and a stated interest rate of 2.94%. CAPREIT used the net proceeds of the sale to partially repay the Acquisition and Operating Facility.
On August 3, 2015, CAPREIT closed its equity issue and sale of 5,126,000 Trust Units (including over allotment) which was previously announced on July 11, 2016, for $32.20 per Unit for aggregate gross proceeds of $165.1 million. The offering was sold through a syndicate of underwriters led by RBC Capital Markets on a bought-deal basis. CAPREIT used the net proceeds of the offering to partially repay the Acquisition and Operating Facility.
Additional Information
More detailed information and analysis is included in CAPREIT's unaudited condensed consolidated interim financial statements and MD&A for the three and six months ended June 30, 2016, which have been filed on SEDAR and can be viewed at under CAPREIT's profile or on CAPREIT's website on the investor relations page at or .
Conference Call
A conference call hosted by Thomas Schwartz, President and CEO and the CAPREIT Management Team, will be held Wednesday, August 10, 2016 at 10:00 am EST. The telephone numbers for the conference call are: Local/International: (416) 340-2216, North American Toll Free: (866) 225-0198.
A slide presentation to accompany Management's comments during the conference call will be available one hour and a half prior to the conference call. To view the slides, access the CAPREIT website at or , click on "Investor Relations" and follow the link at the top of the page. Please log on at least 15 minutes before the call commences.
The telephone numbers to listen to the call after it is completed (Instant Replay) are local/international (905) 694-9451 or North American toll free (800) 408-3053. The Passcode for the Instant Replay is 8515234#. The Instant Replay will be available until midnight, August 17, 2016. The call and accompanying slides will also be archived on the CAPREIT website at or . For more information about CAPREIT, its business and its investment highlights, please refer to our website at or .
About CAPREIT
CAPREIT owns interests in multi-unit residential rental properties, including apartments, townhomes and manufactured home communities primarily located in and near major urban centres across Canada. As at June 30, 2016, CAPREIT had owning interests in 48,609 residential units, comprised of 42,166 residential suites and 31 manufactured home communities ("MHC") comprising 6,443 land lease sites. For more information about CAPREIT, its business and its investment highlights, please refer to our website at or and our public disclosure which can be found under our profile at .
Non-IFRS Financial Measures
CAPREIT prepares and releases unaudited quarterly and audited consolidated annual financial statements prepared in accordance with IFRS. In this and other earnings releases and investor conference calls, as a complement to results provided in accordance with IFRS, CAPREIT also discloses and discusses certain non-IFRS financial measures, including Net Rental Revenue Run-Rate, NOI, FFO, NFFO and applicable per Unit amounts and payout ratios. These non-IFRS measures are further defined and discussed in the MD&A released on August 9, 2016, which should be read in conjunction with this press release. Since Net Rental Revenue Run-Rate, NOI, FFO and NFFO are not determined by IFRS, they may not be comparable to similar measures reported by other issuers. CAPREIT has presented such non-IFRS measures as Management believes these non-IFRS measures are relevant measures of the ability of CAPREIT to earn and distribute cash returns to Unitholders and to evaluate CAPREIT's performance. A reconciliation of Net Income and such non-IFRS measures including Adjusted Funds From Operations ("AFFO") is included in this press release. These non-IFRS measures should not be construed as alternatives to net income (loss) or cash flow from operating activities determined in accordance with IFRS as an indicator of CAPREIT's performance.
Cautionary Statements Regarding Forward-Looking Statements
Certain statements contained, or contained in documents incorporated by reference, in this press release constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to CAPREIT's future outlook and anticipated events or results and may include statements regarding the future financial position, business strategy, budgets, litigation, projected costs, capital investments, financial results, taxes, plans and objectives of or involving CAPREIT. Particularly, statements regarding CAPREIT's future results, performance, achievements, prospects, costs, opportunities and financial outlook, including those relating to acquisition and capital investment strategy and the real estate industry generally, are forward-looking statements. In some cases, forward-looking information can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or the negative thereof, or other similar expressions concerning matters that are not historical facts. Forward-looking statements are based on certain factors and assumptions regarding expected growth, results of operations, performance and business prospects and opportunities. In addition, certain specific assumptions were made in preparing forward-looking information, including: that the Canadian and Irish economies will generally experience growth, however, may be adversely impacted by the global economy; that inflation will remain low; that interest rates will remain low in the medium term; that Canada Mortgage and Housing Corporation ("CMHC") mortgage insurance will continue to be available and that a sufficient number of lenders will participate in the CMHC-insured mortgage program to ensure competitive rates; that the Canadian capital markets will continue to provide CAPREIT with access to equity and/or debt at reasonable rates; that vacancy rates for CAPREIT properties will be consistent with historical norms; that rental rates will grow at levels similar to the rate of inflation on renewal; that rental rates on turnovers will remain stable; that CAPREIT will effectively manage price pressures relating to its energy usage; and, with respect to CAPREIT's financial outlook regarding capital investments, assumptions respecting projected costs of construction and materials, availability of trades, the cost and availability of financing, CAPREIT's investment priorities, the properties in which investments will be made, the composition of the property portfolio and the projected return on investment in respect of specific capital investments.
Although the forward-looking statements contained in this press release are based on assumptions, Management believes they are reasonable as of the date hereof; however there can be no assurance actual results will be consistent with these forward-looking statements, and they may prove to be incorrect. Forward-looking statements necessarily involve known and unknown risks and uncertainties, many of which are beyond CAPREIT's control, that may cause CAPREIT or the industry's actual results, performance, achievements, prospects and opportunities in future periods to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, risks related to: reporting investment properties at fair value, real property ownership, leasehold interests, co-ownerships, investment restrictions, operating risk, energy costs and hedging, environmental matters, insurance, capital investments, indebtedness, interest rate hedging, foreign operation and currency risks, taxation, harmonization of federal goods and services tax and provincial sales tax, land transfer tax, government regulations, controls over financial accounting, legal and regulatory concerns, the nature of units of CAPREIT ("Trust Units"), Preferred Units, and units of CAPREIT's subsidiary, CAPREIT Limited Partnership ("Exchangeable Units") (collectively, the "Units"), unitholder liability, liquidity and price fluctuation of Units, dilution, distributions, participation in CAPREIT's distribution reinvestment plan, potential conflicts of interest, dependence on key personnel, general economic conditions, competition for residents, competition for real property investments, continued growth and risks related to acquisitions. There can be no assurance the expectations of CAPREIT's Management will prove to be correct. These risks and uncertainties are more fully described in regulatory filings, including CAPREIT's Annual Information Form, which can be obtained on SEDAR at , under CAPREIT's profile, as well as under Risks and Uncertainties section of the MD&A released on August 9, 2016. The information in this press release is based on information available to Management as of August 9, 2016. Subject to applicable law, CAPREIT does not undertake any obligation to publicly update or revise any forward-looking information.
SOURCE: Canadian Apartment Properties Real Estate Investment Trust
Contacts:
CAPREIT
Mr. Michael Stein
Chairman
(416) 861-5788
CAPREIT
Mr. Thomas Schwartz
President & CEO
(416) 861-9404
CAPREIT
Mr. Scott Cryer
Chief Financial Officer
(416) 861-5771
Themen in dieser Pressemitteilung:
Unternehmensinformation / Kurzprofil:
Datum: 09.08.2016 - 21:20 Uhr
Sprache: Deutsch
News-ID 488139
Anzahl Zeichen: 0
contact information:
Town:
TORONTO, ONTARIO
Kategorie:
Commercial Real Estate
Diese Pressemitteilung wurde bisher 276 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"CAPREIT Reports Continued Growth and Strong Operating Performance in Second Quarter of 2016"
steht unter der journalistisch-redaktionellen Verantwortung von
Canadian Apartment Properties Real Estate Investment Trust (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
