TORONTO, ONTARIO–(Marketwired – March 22, 2017) – Partners Real Estate Investment Trust (the “REIT,” or “Partners”) (TSX:PAR.UN) today announced its results for the three and twelve month periods ended December 31, 2016 (the “fourth quarter” and “full year 2016,” respectively).
FOURTH QUARTER 2016 HIGHLIGHTS
- Net loss of less than $0.1 million, an improvement of $11.6 million when compared to the fourth quarter of 2015.
- Revenues from income producing properties of $14.4 million, unchanged when compared to the fourth quarter of 2015.
- NOI of $8.6 million, an improvement of $0.4 million when compared with the fourth quarter of 2015.
- FFO and AFFO per unit of $0.10 and $0.09, compared to $0.09 and $0.08, respectively, for the fourth quarter of 2015.
- AFFO payout ratio of 69.1%, compared to 84.5% for the fourth quarter of 2015.
- Occupancy of 95.1% as at December 31, 2016, an improvement when compared to a level of 94.6% as at December 31, 2015.
- As at December 31, 2016, the REIT had renewed a total of 370,274 square feet of leases that were originally set to expire during 2016, representing a renewal rate of approximately 96% for 2016.
- On November 18, 2016, the REIT announced that it had finalized a $10.7 million mortgage at its Centre Commercial Chateauguay property in Montreal, Quebec. This mortgage was refinanced for five years at 2.95%.
| As at and for the three months ended | As at and for the year ended | |||||||||||
| Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2016 | Dec 31, 2015 | |||||||||
| Revenues from income producing properties | $ | 14,391,853 | $ | 14,374,728 | $ | 56,778,859 | $ | 57,089,498 | ||||
| Net income (loss) | (11,467 | ) | (11,632,441 | ) | 9,050,438 | (14,556,117 | ) | |||||
| Net income (loss) per unit – basic | (0.00 | ) | (0.41 | ) | 0.27 | (0.52 | ) | |||||
| NOI – same properties(1) | 8,488,032 | 8,006,107 | 33,128,189 | 32,454,019 | ||||||||
| NOI – all properties(1) | 8,643,554 | 8,234,229 | 33,811,701 | 33,290,048 | ||||||||
| FFO(1) | 3,279,396 | 2,830,049 | 11,882,970 | 9,812,733 | ||||||||
| FFO per unit(1) | 0.10 | 0.09 | 0.35 | 0.35 | ||||||||
| AFFO(1) | 3,092,884 | 2,492,019 | 10,855,174 | 8,972,457 | ||||||||
| AFFO per unit(1) | 0.09 | 0.08 | 0.32 | 0.32 | ||||||||
| Distributions(2) | 2,135,983 | 2,105,285 | 8,494,169 | 7,119,832 | ||||||||
| Distributions per unit(2) | 0.06 | 0.06 | 0.25 | 0.25 | ||||||||
| AFFO distribution payout ratio(3) | 69.1 | % | 84.5 | % | 78.2 | % | 79.4 | % | ||||
| Cash distributions(4) | 1,601,932 | 1,624,306 | 6,403,881 | 5,625,130 | ||||||||
| Cash distributions per unit(4) | 0.05 | 0.05 | 0.20 | 0.20 | ||||||||
| As at | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||||||
| Total assets | $ | 514,700,205 | $ | 520,970,422 | $ | 542,551,040 | |||
| Total debt(6) | 354,556,805 | 364,550,117 | 381,967,023 | ||||||
| Total equity | 151,508,380 | 148,888,084 | 149,036,368 | ||||||
| Weighted average units outstanding – basic | 33,690,649 | 27,831,288 | 26,206,391 | ||||||
| Debt-to-gross book value including debentures(5) | 68.6 | % | 69.5 | % | 70.0 | % | |||
| Debt-to-gross book value excluding debentures(5) | 57.5 | % | 58.6 | % | 54.2 | % | |||
| Interest coverage ratio(6) | 1.81 | 1.59 | 1.80 | ||||||
| Debt service coverage ratio(6) | 1.18 | 1.07 | 1.22 | ||||||
| Mortgages weighted average effective interest rate(7) | 4.41 | % | 4.57 | % | 4.43 | % | |||
| Portfolio occupancy(8) | 95.1 | % | 94.6 | % | 94.3 | % | |||
| (1) | NOI – same properties and all properties, FFO and AFFO are non-IFRS financial measures widely used in the real estate industry. See “Part II – Performance Measurement” for further details and advisories. |
| (2) | Represents distributions to unitholders on an accrual basis. Distributions are payable as at the end of the period in which they are declared by the Board of Trustees, and are paid on or around the 15th day of the following month. Distributions per unit exclude the 5% bonus units, or 3% bonus units for distributions with a record date after March 1, 2016, given to participants in the Distribution Reinvestment and Optional Unit Purchase Plan. |
| (3) | Distribution payout ratio is a non-IFRS financial measure widely used in the real estate industry, calculated as total distributions as a percentage of FFO/AFFO. Management considers the distribution payout ratio a valuable metric to determine the sustainability of the REIT’s distribution. Non-IFRS measures do not have standardized meanings and are therefore unlikely to be comparable to similar measures presented by other issuers. There is no directly comparable IFRS measure. |
| (4) | Represents distributions on a cash basis, and as such, excludes the non-cash distributions of units issued under the Distribution Reinvestment and Optional Unit Purchase Plan. |
| (5) | Debt-to-gross book value is a non-IFRS financial measure widely used in the real estate industry. See calculation under “Debt-to-Gross Book Value” in “Part IV – Results of Operations”. Management considers debt-to-gross book value to be a valuable metric in assessing the REIT’s overall leverage. Non-IFRS measures do not have standardized meanings and are therefore unlikely to be comparable to similar measures presented by other issuers. There is no directly comparable IFRS measure. |
| (6) | Interest coverage ratio and debt service coverage ratio are non-IFRS financial measures widely used in the real estate industry, calculated on a rolling four-quarter basis. See definition under “Mortgages and Other Financing” in “Part IV – Results of Operations”. Management considers the interest coverage and debt service coverage ratios to be valuable metrics in assessing the REIT’s ability to make contractual payments on debt. Non-IFRS measures do not have standardized meanings and are therefore unlikely to be comparable to similar measures presented by other issuers. There are no directly comparable IFRS measures. |
| (7) | Represents the weighted average effective interest rate for secured debt excluding debentures and credit facilities. |
| (8) | Portfolio occupancy is calculated as economic occupancy, not physical occupancy. A unit is considered occupied once it is committed to a lease with a minimum one-year term. |
“Partners’ results for the fourth quarter of 2016 reflect the REIT’s focus on our existing portfolio, including the decision earlier this year to internalize the management of our properties outside of Quebec and the concentration of external management services inside Quebec to a single service provider,” stated Jane Domenico, the REIT’s CEO. “The initial benefits of this decision are evident in today’s quarterly results, which reflect improvements in both our operational costs and portfolio occupancy. The recently announced new pad development at Mariner Square and at Place Desormeaux coupled with significant new tenants at our Cornwall Square property in Ontario are concrete examples of this focus. We look forward to creating similar opportunities across our portfolio in 2017. Even though the Canadian retail real estate landscape remains challenging, today’s results give us confidence that the operational changes we have made to date have laid the foundation for Partners’ long-term success.”
Further Information
A more detailed analysis of the REIT’s financial results for the fourth quarter and full year 2016 are included in the REIT’s Management Discussion and Analysis and Consolidated Financial Statements, which have been filed on SEDAR and can be viewed at www.sedar.com or on the REITs’ website at www.partnersreit.com.
Conference Call
Partners will host a conference call at 8:30 AM Eastern on Thursday, March 23, 2017, at which time Partners’ management will both review the financial results and discuss the REIT’s strategic outlook.
Conference Dial-In Details
Toll Free (North America): 800-377-0758
Local: 416-340-2216
Instant Replay Details (Available until March 30, 2017)
Toll Free (North America): 800-408-3053
Passcode: 9254601
A recording of the conference call will also be available via Partners’ website.
About Partners REIT
Partners REIT is a growth-oriented real estate investment trust focused on the expansion and management of a portfolio of 35 retail and mixed-use community and neighbourhood shopping centres. These properties are located in both primary and secondary markets across British Columbia, Alberta, Manitoba, Ontario, and Quebec, and comprise a total of approximately 2.5 million square feet of leasable space.
Disclaimer
Certain statements included in this press release constitute forward-looking statements, including, but not limited to, those identified by the expressions “expect,” “will” and similar expressions to the extent they relate to Partners REIT. The forward- looking statements are not historical facts but reflect Partners REIT’s current expectations regarding future results or events. These forward looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including access to capital, regulatory approvals, intended acquisitions and general economic and industry conditions. Although Partners REIT believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein.
Investor Relations
1 (844) 474-9620 ext. 401
investor.relations@partnersreit.com
Partners REIT
Jane Domenico
Chief Executive Officer
(416) 855-3313 ext. 501
www.partnersreit.com