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TORONTO, Aug. 25, 2016 /CNW/ – Starlight U.S. Multi-Family (No. 3) Core Fund (TSX.V: SUS.A, SUS.U) (the “Fund”) today announced its results of operations and financial condition for the three months ended June 30, 2016 (the “Second Quarter”). All amounts in this news release are in thousands of United States dollars and include the Fund’s share of revenues, expenses, assets and liabilities in its joint venture interests in The Villages at Sunset Ridge, Belle Haven Apartments and Sorelle Apartments.
Second Quarter Highlights
- Same property rents increased to $1,137 (actual dollars) as of June 30, 2016 from $1,104 (actual dollars) as of June 30, 2015, representing an increase of 3.0% and have increased by 3.9% on an annualized basis since the Fund’s inception.
- Portfolio occupancy was 92.3% during the Second Quarter, compared to 95.5% during the same period last year, both within the Fund’s targeted occupancy range.
- Same property revenue growth was 2.4% compared to the six months ended June 30, 2015.
- Net operating income (“NOI”) for the Second Quarter and six months ended June 30, 2016 was $2,777 was $5,655, respectively, or 24.8% and 32.1% higher than the same periods last year.
- Same property NOI growth during the six months ended June 30, 2016 was $108 or 2.6% higher than the same period last year.
- Adjusted funds from operations (“AFFO”) per unit was $0.23 for the Second Quarter compared to $0.22 for the second quarter of 2015 representing an increase of 4.5%, reflecting the contribution from the acquired joint venture interest in Sorelle Apartments.
- AFFO payout ratio at 60.4% and 54.9% for the Second Quarter and six months ended June 30, 2016 was significantly reduced from 65.4% and 68.7% for the same periods in 2015.
- The Fund recognized an increase in its investment properties during the Second Quarter of $7.2 million and the Fund’s investment properties were valued at $226.2 million as of June 30, 2016.
- Interest coverage ratio and indebtedness coverage ratio for the Second Quarter and six months ended June 30, 2016 were 2.29 times and 2.44 times.
- The Fund’s weighted average mortgage interest rate was 2.44% as at June 30, 2016 and the weighted average term to maturity was 4.82 years.
- Indebtedness to gross book value was 65.0% and within the Fund’s targeted range of 60-70%.
Operating Results
Property revenue for the Second Quarter increased by $1,104 or 25.6%, to $5,417 when compared to the second quarter of 2015 and NOI increased by $522 or 24.8% to $2,777 when compared to the second quarter 2015. The increases are predominately due to the acquisition of the joint venture interest in Sorelle Apartments in September of 2015. Same property revenue and NOI growth was 1.9% and (1.7%) respectively for the Second Quarter. For the six months ended June 30, 2016, same property revenue and NOI growth was 2.4% and 2.6% respectively.
Portfolio occupancy was 92.3% during the Second Quarter compared to 95.5% during the second quarter of 2015, both within the Fund’s targeted occupancy range. Same property rents grew by 3.0% to $1,137 (actual dollars) compared to the second quarter of 2015 and has increased by 3.9% on an annualized basis since the Fund’s inception.
Financial Position
As at June 30, 2016, the Fund’s gross book value was $226.2 million and indebtedness was $147.1 million or 65.0% of gross book value, which was within the Fund’s targeted range of 60%-70%. The interest coverage ratio and indebtedness coverage ratio for the Second Quarter were 2.29 times. The weighted average interest rate on the Fund’s mortgage portfolio increased to 2.44% in the Second Quarter, compared to 2.18% as of June 30, 2015. The weighted average term to maturity on mortgages was 4.82 years.
About Starlight U.S. Multi-Family (No. 3) Core Fund
The Fund is a limited partnership formed under the Limited Partnerships Act (Ontario) for the primary purpose of indirectly acquiring, owning and operating a portfolio of diversified income producing rental properties in the U.S. multi-family real estate market.
For complete consolidated financial statements and management’s discussion and analysis for the period, and any other information relating to the Fund, please visit www.sedar.com. Further details regarding the Fund’s unit performance and distributions, market conditions where the Fund’s properties are located, performance by the Fund’s properties and a capital investment update are also available in the Fund’s August 2016 Newsletter which is available on the Fund’s profile at www.starlightus.com.
Non-IFRS Financial Measures
Certain terms used in this news release including NOI, AFFO, gross book value, indebtedness, interest coverage ratio and indebtedness coverage ratio are not measures defined under International Financial Reporting Standards (“IFRS”) as prescribed by the International Accounting Standard Board. Details on non-IFRS financial measures are set out in the Fund’s management’s discussion and analysis for the period available on the Fund’s profile at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Starlight U.S. Multi-Family (No. 3) Core Fund
