TORONTO, ONTARIO–(Marketwired – March 17, 2016) –
NOT FOR DISSEMINATION IN THE UNITED STATES OR TO ANY NON-CANADIAN SOURCE
OneREIT (TSX:ONR.UN) today announced results for the fourth quarter and year ended December 31, 2015.
Highlights:
- Funds from Operations (“FFO”) increased 8.8% to $37.1 million for the year ended December 31, 2015 compared to $34.1 million for the same period in 2014, reflecting a $3.0 million increase.
- FFO was $9.5 million for the fourth quarter 2015, compared to $10.0 million for the same period in 2014.
- FFO per unit was $0.111 and $0.431 for the quarter and year ended December 31, 2015, respectively.
- FFO payout ratio for the fourth quarter was 68.2%.
- Weighted average cost of mortgage debt decreased to 4.56% compared to 4.83% as at December 31, 2014.
- Portfolio occupancy increased to 88.1% compared to 85.6% on December 31, 2014.
- Commenced the $30 million redevelopment of the Golden Mile Shopping Centre in Regina, Saskatchewan, with Goodlife Fitness opening its new 24,500 square foot facility in spring 2016. The Real Canadian Superstore is set to open its new 92,000 square foot store in early 2017, with all phases of redevelopment to be completed by mid-2018.
- Internalization of property management for a majority of the portfolio is scheduled for April 1, 2016.
- Leased 19,000 square feet to Michaels at the Orangeville Mall for a term of 10 years, which completes the re-tenanting of the former Zeller’s space at the shopping centre.
- Invested $11.0 million in five intensification projects adding 40,000 square feet of GLA.
Richard Michaeloff, President and CEO of OneREIT, said “During 2015, we continued our strategy of improving the quality of our REIT. We launched the revitalization of our Golden Mile Shopping Centre and completed the disposal of two non-core properties. Our leasing team is focused on driving higher occupancy and continuing to build on our quality tenant profile. We also initiated the process of internalization of property management for the majority of the REIT’s portfolio, with implementation scheduled for April 2016.”
Financial Highlights
| Three months ended December 31 |
Year ended December 31 |
|||||||||||
| (all amounts in $000’s, except per unit amounts and ratios) | 2015 | 2014 | 2015 | 2014 | ||||||||
| Rental revenue and other income | 30,742 | 31,472 | 123,270 | 113,933 | ||||||||
| Property operating expenses | 12,393 | 12,821 | 50,202 | 48,149 | ||||||||
| Property operating income | 18,349 | 18,651 | 73,068 | 65,784 | ||||||||
| Share of joint venture net operating income | 458 | 456 | 1,822 | 1,850 | ||||||||
| Net operating income (1) | 18,807 | 19,107 | 74,890 | 67,634 | ||||||||
| Trust expenses | 1,156 | 964 | 4,522 | 4,556 | ||||||||
| Finance costs – joint venture operations | 191 | 201 | 776 | 816 | ||||||||
| Finance costs – operations | 7,941 | 7,937 | 32,626 | 28,288 | ||||||||
| Finance costs – distributions on Class B Units | 826 | 1,240 | 4,133 | 4,611 | ||||||||
| Income before fair value gains (losses) and other income | 8,693 | 8,765 | 32,833 | 29,363 | ||||||||
| Fair value gains (losses) associated w ith financial instruments | (4,053 | ) | 4,549 | 67 | 2,110 | |||||||
| Fair value gains (losses) on investment property | 340 | (13,936 | ) | (5,201 | ) | (22,071 | ) | |||||
| Fair value gains (losses) on joint venture property | (51 | ) | (1,504 | ) | 222 | (805 | ) | |||||
| Loss from other items on disposition of investment property | – | – | (712 | ) | – | |||||||
| Net Income (loss) for the period | 4,929 | (2,126 | ) | 27,209 | 8,597 | |||||||
| FFO (2) | 9,543 | 10,039 | 37,075 | 34,087 | ||||||||
| FFO per unit | $ | 0.111 | $ | 0.118 | $ | 0.431 | $ | 0.443 | ||||
| FFO payout ratio (historical) (3) | 95.3 | % | 101.6 | % | ||||||||
| FFO payout ratio (pro forma) (4) | 68.2 | % | 69.6 | % | ||||||||
Full Financial Results and MD&A will be available on SEDAR (www.sedar.com) as well as the Investors Relations section of the REIT’s website (www.onereit.ca).
| (1) | A non-IFRS measurement, calculated by the REIT as rental revenue (net rents, property tax and operating cost recoveries, as well as other miscellaneous income from tenants) less operating expenses for properties. |
| (2) | The reconciliations from net income (loss) to Funds from Operations are included in the REIT’s MD&A. |
| (3) | FFO payout ratio (historical) has been calculated based on the REIT’s previous annualized distribution rate of $0.45 per unit. |
| (4) | FFO payout ratio (pro-forma) has been calculated on a pro forma basis as determined by the REIT’s new distribution policy. |
The REIT’s management considers Net Operating Income, Funds from Operations and Debt to Gross Book Value ratio to be indicative measures in evaluating the REIT’s performance. The table above includes non-IFRS information that should not be construed as an alternative to net income or cash flows from operations and may not be comparable to similar measures presented by other issuers as there is no standardized meaning prescribed by IFRS.
Conference Call
OneREIT will hold a conference call on Friday, March 18, 2016 at 10:00 am (ET). Participating on the call will be members of the REIT’s senior management.
Investors are invited to access the call by dialling 416-204-9702 or 1-800-524-8850. A recording of this call will be made available Friday, March 18, 2016 beginning at 1:00 pm (ET) through to Friday, April 1, 2016 ending at 1:00pm (ET). To access the recording, please call 647-436-0148 or 1-888-203-1112 and use the reservation number 6866405.
About OneREIT
OneREIT is an unincorporated, open-end real estate investment trust which focuses on owning and acquiring retail properties across Canada with the goal of enhancing long-term Unitholder value.
Forward-Looking Information
This press release contains forward-looking statements, which reflect management’s expectations regarding the REIT’s future growth, results of operations, performance, and business prospects and opportunities. These statements relate to, but are not limited to, the REIT’s expectations, intentions, plans and beliefs . In some cases, forward-looking statements can be identified by the use of words such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “continue” or the negative or grammatical variations of these terms or other comparable terminology. Readers should be aware that these statements are subject to known and unknown risks, uncertainties and other factors, including, but not limited to: those discussed or referenced under the heading “Risk Factors” in the REIT’s Management’s Discussion and Analysis for the three months and year ended December 31, 2015, as well as competition within the commercial real estate sector, the effective international, national and regional economic conditions and the availability of capital to fund further investments in the REIT’s business. Actual events or results may differ materially from those suggested by any forward-looking statements. Readers should not place undue reliance on any forward-looking statements contained in this press release. By their nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. Although management of the REIT believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that future results, levels of activity, performance or achievements will occur as anticipated. Neither the REIT nor any other person assumes responsibility for the accuracy and completeness of any forward-looking statements, and no one has any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or such other factors which affect this information, except as required by law.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, which may be made only by means of a prospectus, nor shall there be any sale of the Units in any state, province or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under securities laws of any such state, province or other jurisdiction. The Units of the OneREIT have not been, and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or delivered in the United States absent registration or an exemption from the registration requirements of U.S. securities laws.
Richard Michaeloff
Chief Executive Officer
(416) 741-7999
(416) 741-7993 (FAX)
rmichaeloff@onereit.ca
www.onereit.ca