CAPREIT Reports Continued Growth and Strong Operating Performance in Second Quarter of 2017

TORONTO, ONTARIO–(Marketwired – Aug. 14, 2017) – Canadian Apartment Properties Real Estate Investment Trust (“CAPREIT”) (TSX:CAR.UN) announced today strong operating and financial results for the three and six months ended June 30, 2017.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2017			2016			2017			2016
Operating Revenues (000s)	$	157,087		$	146,656		$	312,697		$	292,294
Net Rental Income (“NOI”) (000s)(1)	$	98,705		$	91,083		$	190,303		$	175,463
NOI Margin(1)		62.8	%		62.1	%		60.9	%		60.0	%
Normalized Funds From Operations (“NFFO”) (000s)(1)	$	63,608		$	58,452		$	121,545		$	110,747
NFFO Per Unit – Basic(1)	$	0.469		$	0.455		$	0.898		$	0.864
Weighted Average Number of Units – Basic (000s)		135,629			128,469			135,354			128,143
NFFO Payout Ratio(1)		69.3	%		68.6	%		71.8	%		72.0	%
(1) NOI, NFFO and NFFO per Unit are measures used by Management in evaluating operating performance. Please refer to the cautionary statements under the heading “Non-IFRS Financial Measures” and the reconciliations provided in this press release.

• Accretive acquisitions of 332 suites further strengthens and diversifies property portfolio
• Stabilized portfolio occupancy strengthens to 98.6% with solid 3.0% increase in average monthly rents
• Portfolio growth and strong operating performance generates 7.1% and 7.0% increase in revenues for the three and six months ended June 30, 2017
• NOI up 8.4% and 8.5% in the second quarter and first six months of 2017
• Continuing strong organic growth as same property NOI up 3.9% and 3.8% for the three and six months ended June 30, 2017
• NFFO up 8.8% in second quarter, 9.8% for the six months ended June 30, 2017
• NFFO payout ratio strong at 71.8% for the six months ended June 30, 2017
• Continued accretive growth as NFFO per Unit up 3.1% and 3.9% for the three and six months ended June 30, 2017 despite lower leverage and a 5.6% increase in the weighted average number of Units outstanding
• Financial position continues to strengthen with reduced leverage, lower interest costs, increased growth capacity and $252.5 million in unencumbered assets
• Subsequent to quarter Netherlands portfolio more than doubles with purchase of 905 residential suites.
• Closed and committed mortgage refinancings and new financings for $199.6 million, including $106.8 million for renewals of existing mortgages and $92.8 million for additional top up financing and new acquisition financing with a weighted average term to maturity of 9.0 years, and a weighted average interest rate of 2.68%

Our twenty-year track record of strong growth and solid operating performance continued in the second quarter of 2017. Accretive property acquisitions, combined with industry-leading organic growth, continue to generate significant benefits for our Unitholders. Looking ahead, supported by our strong and flexible balance sheet and financial position, we are confident 2017 will be another record year for CAPREIT.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2017			2016			2017			2016
Overall Portfolio Occupancy(1)								98.6	%		98.2	%
Overall Portfolio Average Monthly Rents(1),(2)							$	1,015		$	980
Operating Revenues (000s)	$	157,087		$	146,656		$	312,697		$	292,294
Annualized Net Rental Revenue Run-Rate (000s)(1),(3),(4)							$	599,109		$	576,172
Operating Expenses (000s)	$	58,382		$	55,573		$	122,394		$	116,831
NOI (000s)(4)	$	98,705		$	91,083		$	190,303		$	175,463
NOI Margin(4)		62.8	%		62.1	%		60.9	%		60.0	%
Number of Suites and Sites Acquired		300			1,153			332			1,823
Number of Suites Disposed		–			–			31			–
(1) As at June 30.
(2) Average monthly rents are defined as actual rents, net of vacancies, divided by the total number of suites and sites in the portfolio and do not include revenues from parking, laundry or other sources.
(3) For a description of net rental revenue run-rate, see the Results of Operations section in the MD&A for the six months ended June 30, 2017.
(4) Net rental revenue run-rate and NOI are measures used by Management in evaluating operating performance. Please refer to the cautionary statements under the heading “Non-IFRS Financial Measures” and the reconciliations provided in this press release.

Operating Revenues

For the three and six months ended June 30, 2017, total operating revenues increased by 7.1% and 7.0%, 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, 2017, ancillary revenues, including parking, laundry and antenna income, increased by 5.1% and 6.0% for the three and six months ended June 30, 2017, respectively, compared to the same periods last year. For the stabilized properties, operating revenues for the three and six months ended June 30, 2017 increased by 3.3% and 3.1% respectively.

CAPREIT’s annualized net rental revenue run-rate as at June 30, 2017 improved to $599.1 million, up 4.0% from $576.2 million at the same period last year, primarily due to acquisitions completed over the last twelve months and strong increases in average monthly rents on properties owned prior to June 30, 2016. Net rental revenue run-rate net of dispositions for the twelve months ended June 30, 2017 was $583.6 million (June 30, 2016 – $536.9 million).

Portfolio Average Monthly Rents (“AMR”)
	Total Portfolio						Properties Owned Prior to June 30, 2016
As at June 30,	2017 (2)			2016			2017			2016 (1)
	AMR		Occ. %		AMR	Occ. %		AMR	Occ. %		AMR	Occ. %
Average Residential Suites	$	1,114	98.6	$	1,076	98.2	$	1,114	98.6	$	1,081	98.2
Average MHC Land Lease Sites	$	383	98.4	$	372	98.3	$	383	98.4	$	372	98.3
Overall Portfolio Average	$	1,015	98.6	$	980	98.2	$	1,014	98.6	$	984	98.2
(1) Prior period comparable AMR and occupancy have been restated for properties disposed of since June 30, 2016.
(2) Under the purchase agreements for a property acquired on May 3, 2017, CAPREIT received monthly escrow payments for the positive differences, if any, between: (a) 100.0% of the gross rent roll for such month less (b) the actual rent earned for such month, with all applicable sales taxes. CAPREIT continues to receive escrow payments when the actual gross revenues were less than the threshold up to a maximum of $2.5 million for the property, after which rental revenue will be based on actual occupancy. The occupancy rates in the tables are reflected at 100.0% for this property.

Overall average monthly rents for the stabilized residential suite portfolio (properties owned prior to June 30, 2016) increased 3.1% to $1,114 as at June 30, 2017 from $1,081 at June 30, 2016. 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 markets. Occupancy for the stabilized residential suite portfolio increased to 98.6% as at June 30, 2017 compared to 98.2% for the same period last year.

For the MHC land lease portfolio, average monthly rents increased to $383 as at June 30, 2017, compared to $372 as at June 30, 2016 while occupancy strengthened to 98.4% compared to 98.3% 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 and Lease Renewals
For the Three Months Ended June 30,	2017				2016
	Change in AMR			% Turnovers	Change in AMR			% Turnovers
	$	%		& Renewals(1)	$	%		& Renewals(1)
Suite Turnovers	65.8	5.9		6.1	6.7	0.6		6.6
Lease Renewals	21.6	1.9		20.6	20.5	1.9		19.8
Weighted Average of Turnovers and Renewals	31.7	2.8			17.0	1.5
For the Six Months Ended June 30,	2017				2016
	Change in AMR			% Turnovers	Change in AMR			% Turnovers
	$		%	& Renewals(1)	$		%	& Renewals(1)
Suite Turnovers	57.0	5.1		10.4	(7.3)	(0.7	)	12.2
Lease Renewals	21.2	1.9		37.2	22.0	2.0		34.2
Weighted Average of Turnovers and Renewals	29.0	2.6			14.3	1.3
(1) Percentage of suites turned over or renewed during the period based on the total number of residential suites (excluding co-ownerships and the Netherland properties) held at the end of the period.

Suite turnovers in the residential suite portfolio (excluding co-ownerships and the Netherland properties) during the three months ended June 30, 2017 resulted in average monthly rent increasing by approximately $66 or 5.9% per suite compared to an increase of approximately $7 or 0.6% for the same period last year. For the six months ended June 30, 2017, suite turnovers resulted in average monthly rent increasing by approximately $57 or 5.1% compared to a decrease of approximately $7 or 0.7% in the same period last year due primarily to continuing strong rental markets in British Columbia and Ontario partially offset by strategically reduced rents in Alberta and Saskatchewan aimed at increasing occupancy and reducing turnover in these regions.

Pursuant to Management’s focus on increasing overall portfolio rents average monthly rents on lease renewals for the three months ended June 30, 2017 increased by approximately $22 or 1.9% per suite compared to an increase of approximately $21 or 1.9% for the same period last year. For the six months ended June 30, 2017, average monthly rents on lease renewals increased by approximately $21 or 1.9%, compared to an increase of approximately $22 or 2.0% for the same period last year. The rate of growth in average monthly rents on lease renewals has been impacted by the strategically reduced rents in Alberta and Saskatchewan, changes to the mandated rental guideline increases in Ontario and British Columbia for 2017 (Ontario – 1.5%, British Columbia – 3.7%) compared to 2016 (Ontario – 2.0%, British Columbia – 2.9%), and by increases due to above guideline increases (“AGI”) achieved in Ontario. 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 2018, the permitted guideline increase in Ontario has been set at 1.8%.

Operating Expenses
		Three Months Ended						Six Months Ended
		June 30,						June 30,
($ Thousands)			2017	%(1)		2016	%(1)		2017	%(1)		2016	%(1)
Operating Expenses
	Realty Taxes	$	15,571	9.9	$	16,182	11.0	$	32,747	10.5	$	32,189	11.0
	Utilities		12,633	8.0		13,443	9.2		31,363	10.0		32,386	11.1
	Other(2)		30,178	19.2		25,948	17.7		58,284	18.6		52,256	17.9
Total Operating Expenses		$	58,382	37.2	$	55,573	37.9	$	122,394	39.1	$	116,831	40.0
(1) As a percentage of total operating revenues.
(2) Comprises R&M, wages, general and administrative, insurance, advertising, and legal costs.

Operating Expenses

Overall operating expenses as a percentage of operating revenues improved to 37.2% and 39.1%, respectively, for the three and six months ended June 30, 2017 compared to 37.9% and 40.0%, respectively, for the same periods last year, due primarily to lower realty taxes due to tax rebates of $1.4 million in 2017, and utilities as a percentage of total operating revenues.

NOI

For the three months ended June 30, 2017, NOI increased by $7.6 million or 8.4% and the NOI margin increased to 62.8% compared to 62.1% for the same period last year. For the six months ended June 30, 2017, NOI increased by $14.8 million or 8.5%, and the NOI margin increased to 60.9% compared to 60.0% last year, showing the positive effects of CAPREIT’s geographic diversification and its proven property management programs.

NON-IFRS FINANCIAL MEASURES
	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2017			2016			2017			2016
NFFO (000s)	$	63,608		$	58,452		$	121,545		$	110,747
NFFO Per Unit – Basic	$	0.469		$	0.455		$	0.898		$	0.864
Cash Distributions Per Unit	$	0.320		$	0.308		$	0.635		$	0.613
NFFO Payout Ratio		69.3	%		68.6	%		71.8	%		72.0	%
NFFO Effective Payout Ratio		47.4	%		45.5	%		48.7	%		48.0	%

For the six months ended June 30, 2017, basic NFFO per Unit increased by 3.9% compared to the same period last year despite the approximate 5.6% increase in the weighted average number of Units outstanding due to the successful equity offering in August 2016. For the three months ended June 30, 2017, basic NFFO per Unit increased by 3.1% compared to the same period last year despite the approximate 5.6% increase in the weighted average number of Units outstanding.

LIQUIDITY AND LEVERAGE

As at June 30,	2017		2016
Total Debt to Gross Book Value	44.00	%	47.02	%
Total Debt to Gross Historical Cost(1)	54.60	%	57.12	%
Total Debt to Total Capitalization	43.95	%	45.28	%
Debt Service Coverage Ratio (times)(2)	1.63		1.63
Interest Coverage Ratio (times)(2)	3.16		3.01
Weighted Average Mortgage Interest Rate(3)	3.14	%	3.28	%
Weighted Average Mortgage Term to Maturity (years)	5.9		6.5
(1) Based on the historical cost of investment properties.
(2) Based on the trailing four quarters ended June 30, 2017
(3) Weighted average mortgage interest rate includes deferred financing costs and fair value adjustments on an effective interest basis. Including the amortization of the realized component of the loss on settlement of $32.5 million included in AOCL, the effective portfolio weighted average interest rate at June 30, 2017 would be 3.24% (June 30, 2016 – 3.39%).

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:

• Total debt to gross book value ratio strengthened to 44.0% as at June 30, 2017 compared to 47.0% for the same period last year;
• Debt service and interest coverage ratio remained stable at 1.63 times and increased to 3.16 times, respectively, compared to 1.63 times and 3.01 times for the same periods last year1.63;
• As at June 30, 2017, 96.1% (June 30, 2016 – 96.5%), of CAPREIT’s mortgage portfolio was insured by the Canada Mortgage and Housing Corporation (“CMHC”), excluding the mortgages on CAPREIT’s MHC land lease sites, Euro LIBOR borrowings and European financings resulting in improved spreads on mortgages and lower overall interest costs than conventional mortgages.
• The effective portfolio weighted average interest rate on mortgages has steadily declined to 3.14% as at June 30, 2017 from 3.28% as at June 30, 2016, resulting in significant potential interest rate savings in future years;
• Management expects to raise between $185 million and $225 million in total mortgage renewals and refinancings in 2017; Closed and committed mortgage refinancings and new financings for $199.6 million, including $106.8 million for renewals of existing mortgages and $92.8 million for additional top up financing and new acquisition financing with a weighted average term to maturity of 9.0 years, and a weighted average interest rate of 2.68%;
• The weighted average term to maturity for the mortgage portfolio decreased to 5.9 years as at June 30, 2017 compared to 6.5 years as at June 30, 2016;
• As at June 30, 2017, CAPREIT has investment properties with a fair value of $252.5 million not encumbered by mortgages and securing only the Acquisition and Operating Facility. CAPREIT intends to maintain unencumbered investment properties with an aggregate fair value in the range of $150 and $180 million over the long term.

Property Capital Investments

During the six months ended June 30, 2017, CAPREIT made property capital investments (excluding head office assets) of $73.7 million compared to $71.3 million in the same period last year. For the full 2017 year, CAPREIT expects to complete property capital investments (excluding development and intensification) of approximately $170 million to $180 million, including approximately $60 million targeted at acquisitions completed since January 1, 2013, and approximately $25 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 12, 2017, CAPREIT completed the previously announced acquisition of 19 properties totaling 849 residential suites located in eight cities and towns in the Netherlands. The purchase price of EUR170.4 million will be financed with new mortgage financing of approximately EUR100.8 million with a weighted average term of approximately 7.5 years bearing a weighted average interest rate of approximately 1.9% and the remaining with a euro-based loan under CAPREIT’s Acquisition and Operating credit facility.

On August 8, 2017, CAPREIT completed the acquisition of a 56 unit rental apartment located in Enschede, Netherlands at a purchase price of EUR8.4 million financed with CAPREIT’s Acquisition and Operating credit facility.

With the completion of these transactions, CAPREIT’s Netherlands portfolio has grown to 1,473 residential suites well-located in major city centres in the country.

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, 2017, which have been filed on SEDAR and can be viewed at www.sedar.com under CAPREIT’s profile or on CAPREIT’s website on the investor relations page at www.caprent.com or www.capreit.net.

Conference Call

A conference call hosted by the CAPREIT Management Team, will be held Tuesday, August 15, 2017 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 www.caprent.com or www.capreit.net, 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 3399651#. The Instant Replay will be available until midnight, August 22, 2017. The call and accompanying slides will also be archived on the CAPREIT website at www.caprent.com or www.capreit.net. For more information about CAPREIT, its business and its investment highlights, please refer to our website at www.caprent.com or www.capreit.net.

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, 2017, CAPREIT had owning interests in 49,075 residential units, comprised of 42,623 residential suites and 31 manufactured home communities (“MHC”) comprising 6,452 land lease sites. For more information about CAPREIT, its business and its investment highlights, please refer to our website at www.caprent.com or www.capreit.net and our public disclosure which can be found under our profile at www.sedar.com.

Non-IFRS Financial Measures

CAPREIT prepares and releases unaudited consolidated interim financial statements 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 financial measures not recognized under IFRS and that do not have standard meanings prescribed by IFRS. These include stabilized net rental income (“Stabilized NOI”), Net Rental Revenue Run-Rate, Funds From Operations (“FFO”), Normalized Funds From Operations (“NFFO”), and Adjusted Cash Flow from Operations (“ACFO”), and applicable per Unit amounts and payout ratios (collectively, the “Non-IFRS Measures”). These Non-IFRS Measures are further defined and discussed in the MD&A released on August 14, 2017, which should be read in conjunction with this press release. Since Stabilized NOI, Net Rental Revenue Run-Rate, FFO, NFFO, and ACFO are not measures recognized under IFRS, they may not be comparable to similarly titled measures reported by other issuers. CAPREIT has presented the Non-IFRS measures because Management believes these Non-IFRS measures are relevant measures of the ability of CAPREIT to earn revenue and to evaluate CAPREIT’s performance. A reconciliation of Net Income and these Non-IFRS measures is included in this press release. The Non-IFRS measures should not be construed as alternatives to net income (loss) or cash flows from operating activities determined in accordance with IFRS as indicators of CAPREIT’s performance or sustainability of our distributions.

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, Irish and Dutch 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 www.sedar.com, under CAPREIT’s profile, as well as under Risks and Uncertainties section of the MD&A released on August 14, 2017. The information in this press release is based on information available to Management as of August 14, 2017. 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

SELECTED FINANCIAL INFORMATION
Condensed Balance Sheets
As at	June 30, 2017		December 31, 2016
($ Thousands)
Investment properties	$	7,892,401	$	7,642,017
Total Assets		8,202,561		7,892,994
Mortgages payable		3,532,312		3,492,923
Bank indebtedness		100,922		26,408
Total Liabilities		3,836,419		3,734,062
Unitholders’ Equity		4,366,142		4,158,932

Condensed Income Statements
		Three Months Ended						Six Months Ended
		June 30,						June 30,
($ Thousands)			2017			2016			2017			2016
NOI			98,705			91,083			190,303			175,463
	Trust expenses		(7,709	)		(5,865	)		(14,124	)		(16,945	)
	Unrealized Gain on Remeasurement of Investment properties		42,693			48,995			134,204			94,837
	Realized loss on disposition of investment properties		–			–			(80	)		–
	Remeasurement of Exchangeable Units		(51	)		(690	)		(362	)		(1,019	)
	Unit-based compensation expenses		(3,489	)		(13,240	)		(10,609	)		(20,490	)
	Interest on mortgages payable and other financing costs		(28,932	)		(27,572	)		(58,085	)		(54,833	)
	Interest on bank indebtedness		(821	)		(1,444	)		(1,535	)		(2,858	)
	Interest on Exchangeable Units		(51	)		(49	)		(102	)		(98	)
	Other income		7,646			6,312			10,687			8,965
	Amortization		(1,025	)		(1,102	)		(1,989	)		(1,920	)
	Loss on derivative financial instruments		(272	)		(704	)		(86	)		(851	)
	Foreign currency translation		(3,792	)		2,657			(4,151	)		4,228
Net Income			102,902			98,381			244,071			184,479
Other Comprehensive Income		$	6,331		$	186		$	9,375		$	262
Comprehensive Income		$	109,233		$	98,567		$	253,446		$	184,741

Condensed Statements of Cash Flows
			Three Months Ended						Six Months Ended
			June 30,						June 30,
				2017			2016			2017			2016
($ Thousands)
Cash Provided By Operating Activities:
	Net Income		$	102,902		$	98,381		$	244,071		$	184,479
	Items in Net Income Not Affecting Cash:
		Changes in Non-cash Operating Assets and Liabilities		(34,657	)		(3,521	)		(59,984	)		(10,346	)
		Realized and Unrealized Gain on Remeasurements		(42,370	)		(47,601	)		(133,676	)		(92,967	)
		Gain on Sale of Investments		–			–			–			–
		Unit-based Compensation Expenses		3,489			13,240			10,609			20,490
		Items Related to Financing and Investing Activities		26,572			26,527			49,898			49,987
		Other		1,104			(4,298	)		3,071			(4,223	)
Cash Provided By Operating Activities				57,040			82,728			113,989			147,420
Cash Used In Investing Activities
	Acquisitions			(31,578	)		(197,054	)		(36,512	)		(252,065	)
	Capital Investments			(37,745	)		(44,006	)		(74,026	)		(77,284	)
	Dispositions			–			–			575			–
	Other			1,285			(741	)		5,254			2,739
Cash Used In Investing Activities				(68,038	)		(241,801	)		(104,709	)		(326,610	)
Cash Provided (Used) By Financing Activities
	Mortgages, Net of Financing Costs			39,169			212,081			24,366			237,102
	Bank Indebtedness			24,451			(927	)		74,514			45,451
	Interest Paid			(27,829	)		(26,947	)		(55,199	)		(53,850	)
	Proceeds on Issuance of Units			4,970			1,208			5,549			3,831
	Distributions, Net of DRIP and Other			(29,763	)		(26,342	)		(58,510	)		(53,344	)
Cash Provided (Used) By Financing Activities				10,998			159,073			(9,280	)		179,190
Changes in Cash and Cash Equivalents During the Period				–			–			–			–
Cash and Cash Equivalents, Beginning of Period				–			–			–			–
Cash and Cash Equivalents, End of Period			$	–		$	–		$	–		$	–

SELECTED NON-IFRS FINANCIAL MEASURES
A reconciliation of net income to NFFO is as follows:
			Three Months Ended						Six Months Ended
			June 30,						June 30,
($ Thousands, except per Unit amounts)			2017			2016			2017			2016
Net Income		$	102,902		$	98,381		$	244,071		$	184,479
Adjustments
	Unrealized Gain on Remeasurement of Investment Properties		(42,693	)		(48,995	)		(134,204	)		(94,837	)
	Realized Loss on Disposition of Investment Properties		–			–			80			–
	Remeasurement of Exchangeable Units		51			690			362			1,019
	Remeasurement of Unit-based Compensation Liabilities		2,000			11,991			7,800			18,013
	Interest on Exchangeable Units		51			49			102			98
	Corporate Income Taxes		–			–			(23	)		–
	Loss (Gain) on Foreign Currency Translation		3,792			(2,657	)		4,151			(4,228	)
	Unrealized and Realized Loss on Derivative Financial Instruments		272			704			86			851
	Net Income Attributable from Non-Controlling Interest		(17	)		–			(53	)		–
	Net FFO Impact Attributable from Non-Controlling Interest		14			–			38			–
	Amortization of Property, Plant and Equipment		1,025			1,102			1,989			1,920
FFO		$	62,836		$	57,670		$	119,838		$	103,720
Adjustments:
	Amortization of Loss from AOCL to Interest and Other Financing Costs		772			782			1,543			1,553
	Acquisition Research Costs(4)		–			–			–			5,474
	Net Mortgage Prepayment Cost		–			–			164			–
NFFO			63,608			58,452			121,545			110,747
	NFFO per Unit – Basic		0.469			0.455			0.898			0.864
	NFFO per Unit – Diluted		0.462			0.449			0.886			0.853
	Total Distributions Declared(1)		44,079			40,120			87,261			79,750
	NFFO Payout Ratio(2)		69.3	%		68.6	%		71.8	%		72.0	%
	Net Distributions Paid(1)	$	30,176		$	26,623		$	59,205		$	53,191
	Excess NFFO over Net Distributions Paid	$	33,432		$	31,829		$	62,340		$	57,556
	Effective NFFO Payout Ratio(3)		47.4	%		45.5	%		48.7	%		48.0	%
(1) For the description of distributions declared and net distributions paid, see the Non-IFRS Financial Measures section in the MD&A for the six months ended June 30, 2017.
(2) The payout ratio compares distributions declared to NFFO.
(3) The effective payout ratio compares net distributions paid to NFFO.
(4) Expenses incurred relates to transactions that were not completed included in trust expenses.

Reconciliation of cash generated from operating activities to Adjusted Cash Flows from Operations:
		Three Months Ended						Six Months Ended
		June 30						June 30						Annual
($ Thousands, except per Unit amounts)			2017			2016			2017			2016		2016(4)
Cash Generated From Operating Activities		$	57,040		$	82,728		$	113,989		$	147,420		$	361,358
Adjustments
	Changes in Non-Cash Operating Assets and Liabilities		34,657			3,521			59,984			10,346			(24,738	)
	Interest expense included in cash flow from financing activities		(27,829	)		(26,947	)		(55,199	)		(53,850	)		(109,097	)
	Non-Discretionary Property Capital Investments(1)		(11,973	)		(14,536	)		(23,899	)		(28,972	)		(58,501	)
	Capitalized Leasing Costs(2)		(451	)		(944	)		(846	)		(1,736	)		(3,679	)
	Tenant improvements		–			(166	)		(77	)		(282	)		(559	)
	Amortization of Other Financing Costs(3)		(1,370	)		(1,161	)		(2,728	)		(2,189	)		(4,674	)
	Non-controlling Interest		(3	)		–			(15	)		–			(1	)
	Investment income		1,257			420			5,301			3,863			4,519
ACFO		$	51,328		$	42,915		$	96,510		$	74,600		$	164,628
Total Distributions Declared		$	44,079		$	40,120		$	87,261		$	79,750		$	164,413
Excess (Deficit) ACFO Over Distributions Declared		$	7,249		$	2,795		$	9,249		$	(5,150	)	$	215
ACFO Payout Ratio			85.9	%		93.5	%		90.4	%		106.9	%		99.9	%
(1) Based on the forecasted 2017 and actual 2016 Non-Discretionary Property Capital Investments per suite and site multiplied by the weighted average number of residential suites and sites during the period. The Non-Discretionary Property Capital Investment per suite and site on an annual basis for 2017 and 2016 is $1,002 and $1,251, respectively applied equally throughout the year. The weighted average number of residential suites and sites for six months ended June 30, 2017 and 2016 is 47,705, and 46,318, respectively.
(2) Comprises tenant inducements and direct leasing costs.
(3) Includes amortization of deferred financing costs, CMHC premiums, deferred loan costs and fair value adjustments.
(4) Amounts presented for the three and six months ended June 30, 2016 and year ended December 31, 2016, have been presented in accordance with the calculation of ACFO described above and are not comparable to other measures such as adjusted FFO presented in prior periods.