HALIFAX, April 9, 2020 /CNW/ – Killam Apartment REIT (TSX: KMP.UN) recognizes the impact COVID-19 is having on all stakeholders. Our priority is the health and safety of our employees, residents, partners and communities. Killam is executing on its Pandemic Illness Plan and operations plan to lessen the spread of COVID-19 and maintain the continued good health of our employees, residents and communities.
Killam’s portfolio remains operational during this pandemic. Below is a business update, including the impact of COVID-19 on Killam’s operation.
- As of April 8, 2020, Killam has received approximately 93% of rental revenue due for the month of April, including approximately 95% for the apartment and MHC portfolios. This is generally in line with the average rent collected by the eighth day of the month. Killam is actively following up with those accounts in arrears.
- Killam has introduced a rental deferral program to assist those of our residential tenants who are facing financial hardships due to COVID-19. Killam will work with residents on a case-by-case basis on rent deferral arrangements. Currently less than 1% of residential tenants have requested rent deferrals.
- With respect to commercial leases, Killam is also working with qualifying small businesses and independent tenants on a case-by-case basis, and in certain cases has agreed to temporary rent deferrals for 60 to 90 days. Currently tenants representing less than 20% of our commercial revenues have requested rent deferrals.
- Killam’s occupancy remains strong, with apartment occupancy at 97.0% during Q1-2020, and MHC occupancy at 97.7%. This compares with first quarter occupancy in 2019 of 97.1% and 97.8%, respectively. April 2020 occupancy remains strong.
- Leasing activity has continued following the onset of the pandemic as leasing agents are readily able to work remotely. Unit showing procedures have been adjusted to adhere to social distancing guidelines using Killam’s online operating platform and technology for virtual showings. Although turnover was comparable in April 2020 with April 2019, Killam has experienced a slight decrease in leasing levels from pre-COVID-19 levels. We will closely monitor traffic and turnover levels in the coming months as we approach our peak leasing season.
- Killam waivedâ¯the collection of recent rental increases and will suspend collection of further rental increases during this period of crisis, beginning with the April 2020 rent payment.
- Killam had a balance of $12.5 million owing on its lines of credit as of April 8, 2020.
- Killam has access to $87 million of additional capital through its credit facilities (which includes the accordion feature on its $40 million committed revolver facility), as well as approximately $75 million of unencumbered assets.
- To-date, mortgage financings and renewals have progressed on schedule with no mortgage financing delays noted as a result of COVID-19. Killam has additional mortgage renewals scheduled for the remainder of 2020 with upfinancing estimated to be approximately $40 million.
Investment Activity Update
- Killam currently has four development projects underway, including two in Ontario and two in PEI. Construction continues on all four locations, but we are experiencing slowdowns due to the reduced number of labourers reporting to work.
- Killam will review the commencement timelines of the new development projects scheduled to break ground in the second half of the year.
- Killam completed the acquisition of two small properties in March, including an historic building in downtown Halifax and a MHC in Shediac, New Brunswick. The acquisition of both properties totaled $8 million and were funded through Killam’s line of credit. Killam expects to place mortgage debt on both properties in the second quarter.
- Killam has a new 156-unit apartment property in Langford, British Columbia under contract that is expected to close in the second quarter of 2020.
2020 Strategic Targets
Due to the inherent uncertainty surrounding disruption from the COVID-19 pandemic, Killam is reviewing its 2020 strategic targets, specifically its same property NOI growth target for 2020, which were included in its year-end 2019 Management Discussion and Analysis (MD&A) under the heading Strategic Targets. Management will provide an update on these strategic targets in the Q1-2020 MD&A.
Further COVID-19 Information
We are committed to providing updates to our unitholders and other stakeholders during the course of the COVID-19 Pandemic. We have addressed many stakeholders’ questions through a question and answer (Q&A) document on our website and we will continue to update the Q&A on our website during this time of uncertainty.
Killam expects to update stakeholders as to the impact of the COVID-19 pandemic on its operating performance with its Q1-2020 results, scheduled to be released on May 6, 2020.
2019 ESG Report
Killam has published its 2019 Environmental, Social and Governance (ESG) report, which is available on its website. The report describes Killam’s commitment to creating and maintaining sustainable communities and highlights its targets and work on these ESG issues. ESG is a vital component to Killam’s long-term success.
About Killam Apartment REIT
Killam Apartment REIT, based in Halifax, Nova Scotia, is one of Canada’s largest residential landlords, owning, operating and developing a portfolio of apartments and manufactured home communities. Killam’s strategy to enhance value and profitability focuses on three priorities: 1) increasing earnings from existing operations, 2) expanding the portfolio and diversifying geographically through accretive acquisitions, with an emphasis on newer properties, and 3) developing high-quality properties in its core markets.
Note: The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein. Certain statements in this report may constitute forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors including risks and uncertainties relating to the COVID-19 pandemic, which may cause actual results, performance or achievements of Killam to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. For more exhaustive information on these risks and uncertainties, you should refer to Killam’s most recently filed annual information form which is available at www.sedar.com. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made and should not be relied upon as of any other date. Other than as required by law, Killam does not undertake to update any of such forward-looking statements.
SOURCE Killam Apartment Real Estate Investment Trust
View original content: http://www.newswire.ca/en/releases/archive/April2020/09/c3476.html