WINNIPEG, MB, Nov. 3, 2021 /CNW/ – Artis Actual Property Funding Belief (“Artis” or the “REIT”) (TSX: AX.UN, AX.PR.A, AX.PR.E, AX.PR.I) introduced at the moment its monetary outcomes for the three and 9 months ended September 30, 2021. The third quarter press launch needs to be learn together with the REIT’s consolidated monetary statements and Administration’s Dialogue and Evaluation (“MD&A”) for the interval ended September 30, 2021. All quantities are in hundreds of Canadian {dollars}, until in any other case famous.

Artis Actual Property Funding Belief Brand (CNW Group/Artis Actual Property Funding Belief)

“We’re happy with the progress we have made up to now within the execution of our new imaginative and prescient and technique for Artis,” mentioned Samir Manji, President and Chief Govt Officer of Artis. “Through the third quarter, we closed the sale of 32 properties for an mixture sale worth of $761.3 million, together with the sale of the GTA industrial portfolio which represented a big milestone within the implementation of our Enterprise Transformation Plan. These tendencies have been key to offering the REIT with the monetary flexibility we now need to execute on our return of capital and worth investing methods, whereas permitting us to meaningfully cut back our debt to gross e-book worth to 44.0% and to attain a rise in NAV per unit to $17.45 at September 30, 2021. Through the quarter, we acquired a parcel of commercial growth land in the Twin Cities Space the place we have recognized a beautiful alternative to develop fashionable, high-demand industrial actual property that aligns with our price creation plan. We’re assured in our technique, and look ahead to persevering with to reveal our potential to unlock and create worth for our homeowners within the quarters forward.”

THIRD QUARTER HIGHLIGHTS (1)

Enterprise Technique Replace

  • Subsequent to the tip of the quarter, introduced {that a} consortium led by Canderel Actual Property Property Inc., had, via a newly-formed entity, entered into an association to accumulate Cominar Actual Property Funding Belief (“Cominar”) for consideration of $11.75 in money per unit (the “Cominar Transaction”). Artis has dedicated as much as a complete of $214.1 million to the Cominar Transaction’s capital construction, together with $100.0 million of junior most popular items and $114.1 million in widespread fairness items. The Cominar Transaction is anticipated to shut within the first quarter of 2022, topic to the approval of Cominar unitholders, courtroom and required regulatory approvals and customary closing circumstances.

Portfolio Exercise

  • Disposed of 27 industrial properties within the Higher Toronto Space, Ontario, two industrial properties in Winnipeg, Manitoba, and three retail properties in Regina, Saskatchewan, for an mixture sale worth of $761.3 million.

  • Acquired a parcel of commercial growth land in the Twin Cities Space, Minnesota, for a purchase order worth of US$2.2 million.

Stability Sheet and Liquidity

  • Elevated NAV per unit to $17.45 at September 30, 2021, in comparison with $15.03 at December 31, 2020.

  • Improved secured mortgages and loans to GBV to 25.8% at September 30, 2021, in comparison with 27.7% at December 31, 2020.

  • Improved complete long-term debt and credit score amenities to GBV to 44.0% at September 30, 2021, in comparison with 50.2% at December 31, 2020.

  • Improved complete long-term debt and credit score amenities to Adjusted EBITDA to eight.3 at September 30, 2021, in comparison with 9.4 at December 31, 2020.

  • Improved Adjusted EBITDA curiosity protection ratio to three.71 for the third quarter of 2021, in comparison with 3.66 for the third quarter of 2020.

  • Utilized the conventional course issuer bid (“NCIB”) to buy 4,929,552 widespread items at a weighted-average worth of $11.64 and 37,748 most popular items at a weighted-average worth of $24.03.

  • Invested in fairness securities for an mixture value of $44.5 million.

(1) Inclusive of properties held underneath fairness accounted investments.

Monetary and Operational

  • Reported a conservative AFFO payout ratio of 65.2% for the third quarter of 2021, in comparison with 51.9% for the third quarter of 2020.

  • Reported FFO per unit of $0.33 for the third quarter of 2021, in comparison with $0.37 for the third quarter of 2020.

  • Reported AFFO per unit of $0.23 for the third quarter of 2021, in comparison with $0.27 for the third quarter of 2020.

  • Identical Property NOI in Canadian {dollars} for the third quarter of 2021 decreased 4.7% in comparison with the third quarter of 2020.

  • Identical Property NOI in purposeful foreign money for the third quarter of 2021 decreased 1.4% in comparison with the third quarter of 2020.

  • Reported portfolio occupancy of 88.8% (90.8% together with commitments) at September 30, 2021, in comparison with 90.3% (91.8% together with commitments) at June 30, 2021.

  • Renewals totalling 332,619 sq. toes and new leases totalling 113,564 sq. toes commenced in the course of the third quarter of 2021.

  • Weighted-average rental fee on renewals that commenced in the course of the third quarter of 2021 elevated 1.7%.

BALANCE SHEET AND LIQUIDITY

The REIT’s stability sheet highlights and metrics, on a Proportionate Share foundation, are as follows:

September 30,

December 31,

2021

2020

Truthful worth of funding properties

$

4,280,190

$

4,844,086

Truthful worth of unencumbered property

1,942,909

1,941,959

NAV per unit (1)

17.45

15.03

Secured mortgages and loans to GBV (1)

25.8 %

27.7 %

Complete long-term debt and credit score amenities to GBV (1)

44.0 %

50.2 %

Complete long-term debt and credit score amenities to Adjusted EBITDA (1)

8.3

9.4

Adjusted EBITDA curiosity protection ratio (1)

3.71

3.29

Unencumbered property to unsecured debt

2.27

1.73

At September 30, 2021, NAV per unit was $17.45, in comparison with $15.03 at December 31, 2020.

At September 30, 2021, Artis had $280.3 million of money available and $591.7 million obtainable on its revolving time period credit score amenities. Below the phrases of the revolving credit score amenities, the REIT should keep sure monetary covenants which restrict the whole borrowing capability of the revolving credit score amenities to $638.2 million.

Liquidity and capital assets could also be impacted by financing actions, portfolio acquisition, disposition and growth actions, debt repayments, or different actions in accordance with the Enterprise Transformation Plan occurring subsequent to September 30, 2021.

FINANCIAL AND OPERATIONAL RESULTS

Three months ended
September 30,

9 months ended
September 30,

$000’s, besides per unit quantities

2021

2020

% Change

2021

2020

% Change

Income

$

97,658

$

113,328

(13.8)

%

$

321,834

$

345,907

(7.0)

%

Web working earnings

56,089

68,017

(17.5)

%

182,358

204,308

(10.7)

%

Web earnings (loss)

39,855

45,699

(12.8)

%

328,771

(10,881)

(3,121.5)

%

Complete complete (loss)

81,345

15,250

433.4

%

334,767

26,205

1,177.5

%

Distributions per widespread unit

0.15

0.14

7.1

%

0.44

0.41

7.3

%

FFO (1)

$

42,019

$

50,816

(17.3)

%

$

134,020

$

146,615

(8.6)

%

FFO per unit (1)

0.33

0.37

(10.8)

%

1.02

1.06

(3.8)

%

FFO payout ratio (1)

45.5

%

37.8

%

7.7

%

43.1

%

38.7

%

4.4

%

AFFO (1)

$

29,827

$

37,671

(20.8)

%

$

96,557

$

107,831

(10.5)

%

AFFO per unit (1)

0.23

0.27

(14.8)

%

0.73

0.78

(6.4)

%

AFFO payout ratio (1)

65.2

%

51.9

%

13.3

%

60.3

%

52.6

%

7.7

%

(1) Represents a non-GAAP measure. Discuss with the Discover with Respect to non-GAAP Measures.

Artis reported portfolio occupancy of 88.8% (90.8% together with commitments) at September 30, 2021, in comparison with 90.3% (91.8% together with commitments) at June 30, 2021. Weighted-average rental fee on renewals that commenced in the course of the third quarter of 2021 elevated 1.7%.

Artis’ portfolio has a secure lease expiry profile with 48.6% of gross leasable space expiring in 2025 or later. Weighted-average in-place rents for the whole portfolio are $13.28 per sq. foot and are estimated to be 1.9% above market rents. Details about Artis’ lease expiry profile is as follows:

Present emptiness

Month-to-month Tenants

2021

2022

2023

2024

2025

& later

Complete portfolio

Expiring sq. footage

11.2

%

0.1

%

9.0

%

9.9

%

10.3

%

10.9

%

48.6

%

100.0

%

In-place rents

N/A

N/A

$

12.54

$

12.65

$

14.43

$

12.96

$

13.38

$

13.28

Market rents

N/A

N/A

$

11.54

$

12.37

$

14.02

$

12.97

$

13.26

$

13.03

PORTFOLIO ACTIVITY

Acquisition

On September 24, 2021, the REIT acquired a parcel of commercial growth land in the Twin Cities Space, Minnesota, for a purchase order worth of US$2.2 million.

Tendencies

Throughout Q3-21, Artis disposed of the next properties:

Property

Property rely

Location

Disposition date

Asset class

Owned share

of GLA

Sale worth

GTA Industrial Portfolio

27

Higher Toronto Space, Ontario

July 15, 2021 & August 19, 2021

Industrial

2,450,123

$

724,300

King Edward Industrial Portfolio

2

Winnipeg, Manitoba

July 21, 2021

Industrial

31,800

3,200

East Touchdown Retail Portfolio

2

Regina, Saskatchewan

August 23, 2021

Retail

65,083

19,100

West Touchdown Mall

1

Regina, Saskatchewan

September 1, 2021

Retail

39,022

14,665

New Developments

At September 30, 2021, the REIT had 4 ongoing growth tasks: 300 Essential, Park 8Ninety V, Park Lucero East and Blaine 35.

300 Essential is a mixed-used business and residential/multi-family property situated in Winnipeg, Manitoba. Park 8Ninety V is the ultimate part of an industrial growth challenge within the Higher Houston Space, Texas, and is anticipated to comprise three buildings totalling 677,000 sq. toes as soon as full. Artis has a 95% curiosity in Park 8Ninety V within the type of a three way partnership association. Park Lucero East is a state-of-the-art industrial growth challenge situated within the Higher Phoenix Space, Arizona, which is anticipated to comprise three Class A industrial buildings totalling roughly 561,000 sq. toes upon completion. Artis has a ten% curiosity in Park Lucero East within the type of an funding in an affiliate. Blaine 35 is a two-phase industrial growth challenge situated in the Twin Cities Space, Minnesota, with distinguished interstate frontage on the intersection of I-35W and eighty fifth Ave N. The primary part of the challenge, Blaine 35 I, consists of 1 constructing anticipated to complete roughly 118,500 sq. toes of leasable space. The second part, Blaine 35 II, will comprise two buildings anticipated to complete roughly 198,900 sq. toes of leasable space.

IMPACT OF COVID-19

As a diversified REIT, Artis’ portfolio contains industrial, workplace and retail properties which, at September 30, 2021, have been 88.8% leased (90.8% together with commitments on vacant house) to high-quality tenants throughout Canada and the U.S. with a weighted-average remaining lease time period of 5.3 years.

Hire assortment has been a key focus throughout this time. As at September 30, 2021, 98.9% of lease expenses (each excluding and together with deferred lease expenses) have been collected for the three months ended September 30, 2021.

Resulting from government-mandated capability restrictions and non permanent closures of sure non-essential companies all through the course of the COVID-19 pandemic, numerous tenants needed to restrict operations. To help tenants via this troublesome time, qualifying tenants who have been in want of help got the choice to defer a portion of their lease, with an settlement to repay the quantity at a specified later date. As at September 30, 2021, the excellent stability of lease deferrals granted to tenants was $1.3 million ($1.3 million on a Proportionate Share foundation).

The REIT anticipates that almost all of lease deferrals and rents receivable will probably be collected, nevertheless, there are particular tenants that will not be capable of pay their excellent lease. As at September 30, 2021, an allowance for uncertain accounts within the quantity of $1.8 million ($1.8 million on a Proportionate Share foundation) has been recorded, in comparison with $2.0 million ($2.0 million on a Proportionate Share foundation) at December 31, 2020.

General, Artis’ first precedence is to take care of a protected setting for its tenants, staff and the neighborhood. Throughout this unprecedented and unsure time, Artis is dedicated to minimizing the impression on its enterprise, and as a diversified REIT, Artis is assured that it’s well-positioned to deal with the financial challenges which will lie forward.

UPCOMING WEBCAST

events are invited to take part in a webcast with administration on Thursday, November 4, 2021, at 12:00 p.m. CT (1:00 p.m. ET). With a view to take part, please register for the occasion at: https://us02web.zoom.us/webinar/register/WN_6BgMZ85JQ0i9tUQWxvVKcw. You may be required to establish your self on the time of registration.

Should you can not take part on Thursday, November 4, 2021, a replay of the webcast will probably be obtainable on Artis’ web site at www.artisreit.com/investor-link/conference-calls/. The replay will probably be obtainable till Wednesday, March 9, 2022.

NOTICE WITH RESPECT TO NON-GAAP MEASURES

Along with reported IFRS measures, the next non-GAAP measures are generally utilized by Canadian actual property funding trusts as an indicator of economic efficiency: Proportionate Share, Property NOI, Identical Property NOI, FFO, AFFO, FFO and AFFO Payout Ratios, NAV per Unit, Debt to GBV, Adjusted EBITDA Curiosity Protection Ratio and Debt to Adjusted EBITDA. “GAAP” means the widely accepted accounting ideas described by the CPA Canada Handbook – Accounting, that are relevant as on the date on which any calculation utilizing GAAP is to be made. Artis applies IFRS, which is the part of GAAP relevant to publicly accountable enterprises. These non-GAAP measures are usually not outlined underneath IFRS and are usually not supposed to symbolize working earnings for the interval, or from a property, nor ought to any of those measures be considered as an alternative choice to internet earnings, money movement from operations or different measures of economic efficiency calculated in accordance with IFRS.

Readers needs to be additional cautioned that these non-GAAP measures as calculated by Artis will not be similar to related measures introduced by different issuers. These non-GAAP measures are outlined within the REIT’s Q3-21 MD&A.

CAUTIONARY STATEMENTS

This press launch incorporates forward-looking statements. For this function, any statements contained herein that aren’t statements of historic reality could also be deemed to be forward-looking statements. With out limiting the foregoing, the phrases “expects”, “anticipates”, “intends”, “estimates”, “tasks”, “seeks”, and related expressions or variations of such phrases and phrases or state that sure actions, occasions or outcomes ”could”, ”would” or ”will” happen or be achieved are supposed to establish forward-looking statements.

Significantly, statements concerning the Enterprise Transformation Plan, the steps required to implement the Enterprise Transformation Plan, the phrases and circumstances of the Cominar Transaction and Artis’ participation therein, the timing of the Cominar Transaction, Artis’ return of capital and worth investing methods, constructing Artis right into a best-in-class asset administration and funding platform centered on worth investing in actual property, the REIT’s potential to execute its technique, the REIT’s potential to maximise long-term worth and anticipated returns, anticipated distributions by the REIT, deliberate divestitures, the usage of proceeds from divestitures, potential investments and funding technique, Artis’ plans to optimize the worth and efficiency of its property, Artis’ objectives to develop internet asset worth (“NAV”) per unit and distributions, efficiencies and price financial savings, the tax remedy of Artis, Artis’ standing(es) underneath the Tax Act, the tax remedy of divestitures, are ahead trying statements.

Ahead-looking statements are based mostly on numerous elements and assumptions which have been used to develop such statements, however which can show to be incorrect. Though Artis believes that the expectations mirrored within the forward-looking statements are cheap, it can not assure future outcomes, ranges of exercise, efficiency or achievement since such expectations are inherently topic to vital enterprise, financial, aggressive, political and social uncertainties and contingencies. Assumptions have been made concerning, amongst different issues: the final stability of the financial and political setting by which Artis operates, remedy underneath governmental regulatory regimes, securities legal guidelines and tax legal guidelines, the power of Artis and its service suppliers to acquire and retain certified employees, gear and providers in a well timed and price environment friendly method, foreign money, trade and rates of interest, international financial, monetary markets and financial circumstances in Canada and the US won’t, in the long run, be adversely impacted by the COVID-19 pandemic, disruptions ensuing from the non permanent restrictions that governments imposed on companies to deal with the COVID-19 pandemic won’t be long run.

Artis is topic to vital dangers and uncertainties which can trigger the precise outcomes, efficiency or achievements of the REIT to be materially totally different from any future outcomes, efficiency or achievements expressed or implied in these forward-looking statements. Such threat elements embrace, however are usually not restricted to, dangers related to the chance that the proposed Cominar Transaction won’t be accomplished on the phrases and circumstances, or on the timing, at present contemplated, and that it will not be accomplished in any respect, as a result of a failure to acquire or fulfill, in a well timed method or in any other case, required unitholder, courtroom and regulatory approvals and different circumstances of closing essential to finish the Cominar Transaction or for different causes; threat associated to tax issues; and, credit score, market, foreign money, operational, liquidity and funding dangers usually and relating particularly to the Cominar Transaction; the COVID-19 pandemic, actual property possession, geographic focus, present financial circumstances, strategic initiatives, debt financing, rate of interest fluctuations, overseas foreign money, tenants, SIFT guidelines, different tax-related elements, illiquidity, competitors, reliance on key personnel, future property transactions, normal uninsured losses, dependence on data expertise, cyber safety, environmental issues and local weather change, land and air rights leases, public markets, market worth of widespread items, adjustments in laws and funding eligibility, availability of money movement, fluctuations in money distributions, nature of items, authorized rights attaching to items, most popular items, debentures, dilution, unitholder legal responsibility, failure to acquire extra financing, potential conflicts of curiosity, developments and trustees. Additional, the Enterprise Transformation Plan has extra threat elements together with, however not restricted to: failure to execute the Enterprise Transformation Plan partly or in any respect, the power to attain sure efficiencies to generate financial savings basically and administrative bills, tempo of finishing investments and divestitures, the power of Sandpiper Asset Administration Inc. (“Sandpiper”) to offer providers to Artis, threat of not acquiring management or vital affect in portfolio corporations, dangers related to minority investments, reliance on the efficiency of underlying property, working and monetary dangers of investments, rating of Artis’ investments and structural subordination, follow-on investments, investments in non-public issuers, valuation methodologies contain subjective judgments, dangers related to proudly owning illiquid property, aggressive marketplace for funding alternatives, dangers upon disposition of investments, status of Artis and Sandpiper, unknown deserves and dangers of future investments, assets might be wasted in researching funding alternatives that aren’t in the end accomplished, credit score threat, tax threat, regulatory adjustments, overseas safety threat, overseas trade threat, potential conflicts of curiosity with Sandpiper and market low cost.

For extra data on the dangers, uncertainties and assumptions that might trigger the Artis’ precise outcomes to vary from present expectations, consult with the part entitled “Danger Components” of Artis’ Annual Data Kind for the 12 months ended December 31, 2020, the part entitled “Danger and Uncertainties” of Artis’ MD&A for the interim interval ended September 30, 2021, in addition to Artis’ different public filings, obtainable at www.sedar.com.

Artis can not guarantee buyers that precise outcomes will probably be according to any forward-looking statements and Artis assumes no obligation to replace or revise such forward-looking statements to replicate precise occasions or new circumstances apart from as required by relevant securities legal guidelines. All forward-looking statements contained on this press launch are certified by this cautionary assertion.

ABOUT ARTIS REAL ESTATE INVESTMENT TRUST

Artis is a diversified Canadian actual property funding belief with a portfolio of commercial, workplace and retail properties in Canada and the US. Artis’ imaginative and prescient is to construct a best-in-class asset administration and funding platform centered on rising internet asset worth per unit and distributions for buyers via worth investing in actual property.

600 – 220 Portage Avenue
Winnipeg, MB R3C 0A5
T 204.947.1250 F 204.947.0453
www.artisreit.com
AX.UN on the TSX

SOURCE Artis Actual Property Funding Belief

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