Pure Multi-Family REIT LP Announces Release of Second Quarter Financial Results and Conference Call
"SAME PROPERTY METRICS CONTINUE GROWTH TREND INTO SECOND QUARTER"
VANCOUVER, Aug. 8, 2018 /PRNewswire/ - Pure Multi-Family REIT LP ("Pure Multi-Family") (TSXV: RUF.U, RUF.UN, RUF.DB.U; OTCQX: PMULF) is pleased to announce the release of its financial results for the three and six months ended June 30, 2018.
The results, consisting of Pure Multi-Family's condensed interim consolidated financial statements for the three and six months ended June 30, 2018, and management's discussion and analysis of results of operations and financial condition ("MD&A") dated August 8, 2018 are available on SEDAR at www.sedar.com and at www.puremultifamily.com. All metrics are stated at Pure Multi's interest, which adjusts for any real estate taxes related to IFRIC 21, and dollar amounts are disclosed in U.S. dollars, unless otherwise indicated.
Financial Highlights
| For the three months ended June 30, |
For the six months ended June 30, |
|||||||
| (US$000's, except per unit amounts) |
2018 |
2017 |
Change |
2018 |
2017 |
Change |
||
| Rental Revenue – Same Property (1) |
20,236 |
19,637 |
3.1% |
40,362 |
38,999 |
3.5% |
||
| Net Rental Income – Same Property (1) |
11,527 |
10,238 |
12.6% |
22,799 |
20,515 |
11.1% |
||
| Average Rent Per Occupied Unit – Same Property (1) |
1,263 |
1,253 |
0.8% |
1,261 |
1,250 |
0.9% |
||
| Average Physical Occupancy – Same Property (1) |
95.2% |
94.0% |
120bps |
94.9% |
93.6% |
130bps |
||
| (1) Same Property – represents properties owned as at January 1, 2017 and throughout the comparative periods. |
||||||||
| As at June 30, 2018 |
As at |
Change |
||||||
| Debt to Gross Book Value Ratio |
53.0% |
53.4% |
(40bps) |
|||||
| Total Portfolio Leased Occupancy |
97.7% |
95.0% |
270bps |
|||||
| Total Number of Investment Properties |
22 |
22 |
- |
|||||
| Total Number of Residential Units |
7,085 |
7,085 |
- |
|||||
| Portfolio Weighted Average Year of Construction |
2007 |
2007 |
- |
|||||
Stephen Evans, Pure Multi-Family's CEO stated, "Our strong operating performance year-to-date continued with same property revenue growth of 3.1% and same property net rental income growth of 12.6% during the quarter, driven by our sustained efforts to improve portfolio occupancy, reduce rental concessions, and decrease operating expenses across our portfolio."
Based on investment properties owned as of January 1, 2017 and throughout the comparative periods, for the three and six months ended June 30, 2018, Pure Multi-Family achieved same property revenue growth of 3.1% and 3.5%, respectively, and same property net rental income ("NOI") growth of 12.6% and 11.1%, respectively, compared to the same periods in the prior year. Same property revenue growth was driven by increases in same property physical occupancy and same property average rent per occupied unit, coupled with a reduction in same property rental concessions. Same property NOI, over the same periods, was primarily positively impacted by the internalization of the property management function. Normalizing the impact resulting from the elimination of property management fees and the resolution of prior year property tax appeals, adjusted same property NOI for the three and six months ended June 30, 2018 increased by 5.7% and 5.2%, respectively, compared to the same periods in the prior year.
| For the three months ended June 30, |
For the six months ended June 30, |
||||||
| (US$000's, except units and per unit amounts) |
2018 |
2017 |
Change |
2018 |
2017 |
Change |
|
| Weighted Average Units Outstanding - Basic |
76,731,540 |
65,867,109 |
76,731,227 |
60,994,875 |
|||
| Weighted Average Units Outstanding - Diluted |
80,761,628 |
69,898,967 |
80,761,315 |
65,026,733 |
|||
| Rental Revenue – Same Property (1) |
20,236 |
19,637 |
3.1% |
40,362 |
38,999 |
3.5% |
|
| Rental Revenue – Non-Same Property |
7,123 |
2,167 |
228.7% |
14,110 |
3,642 |
287.4% |
|
| Rental Revenue – Total |
27,359 |
21,804 |
25.5% |
54,472 |
42,641 |
27.7% |
|
| Net Rental Income – Same Property (1) |
11,527 |
10,238 |
12.6% |
22,799 |
20,515 |
11.1% |
|
| Net Rental Income – Non-Same Property |
3,965 |
1,075 |
268.8% |
7,828 |
1,898 |
312.4% |
|
| Net Rental Income – Total |
15,492 |
11,313 |
36.9% |
30,627 |
22,413 |
36.6% |
|
| FFO |
6,446 |
4,792 |
34.5% |
13,877 |
10,220 |
35.8% |
|
| FFO Per Unit – Basic |
0.08 |
0.07 |
16.1% |
0.17 |
0.16 |
8.9% |
|
| FFO Per Unit – Diluted |
0.08 |
0.07 |
16.1% |
0.17 |
0.16 |
8.9% |
|
| FFO Payout Ratio |
115.5% |
141.9% |
(2,510bps) |
107.3% |
120.4% |
(1,260bps) |
|
| AFFO |
6,005 |
4,428 |
35.6% |
12,994 |
9,515 |
36.6% |
|
| AFFO Per Unit – Basic |
0.08 |
0.07 |
17.1% |
0.16 |
0.15 |
9.5% |
|
| AFFO Per Unit – Diluted |
0.08 |
0.07 |
17.1% |
0.16 |
0.15 |
9.5% |
|
| AFFO Payout Ratio |
124.0% |
153.6% |
(2,960bps) |
114.6% |
129.3% |
(1,470bps) |
|
| (1) Same Property – represents properties owned as at January 1, 2017 and throughout the comparative periods. |
|||||||
Pure Multi-Family's FFO and AFFO payout ratios improved during both the three and six month periods ending June 30, 2018, compared to the same periods in the prior year. These improvements to the FFO and AFFO payout ratios were partially offset by increased general and administrative ("G&A") expenses related to the previously disclosed strategic review process implemented earlier in the year. Excluding these additional expenditures related to the strategic review process, the FFO payout ratios for the three and six months ended June 30, 2018 would have been 104.4% and 101.0%, respectively, and the AFFO payout ratios for the same periods would have been 111.2% and 107.5%, respectively.
Pure Multi-Family incurred G&A expenses of $2,544,834 and $4,179,164 during the three and six months ended June 30, 2018, respectively, representing G&A expenses as a percentage of revenues of 9.3% and 7.7%. G&A expenses during the current year include additional corporate level expenditures resulting from the internalized property management function and non-recurring expenditures resulting from the strategic review process.
The non-recurring expenditures, resulting from the strategic review process, included within G&A expenses were approximately $687,000 during the three months ended June 30, 2018 and $857,000 during the six months ended June 30, 2018. Removing these non-recurring expenditures results in an adjusted G&A expense as a percentage of revenues of 6.8% and 6.1%, respectively, for the three and six months ended June 30, 2018.
Q2-2018 Conference Call
Stephen Evans, CEO, Samantha Adams, SVP, and Scott Shillington, CFO, of Pure Multi-Family, will host the conference call at 10:00 am (PST), 1:00 pm (EST), on Thursday, August 9, 2018, to review the financial results and corporate developments for the three and six months ended June 30, 2018.
To participate on the conference call, please dial one of the following numbers approximately 10 minutes prior to the commencement of the call and ask to join the Pure Multi-Family REIT LP Conference Call.
Dial in numbers
| • Toll free dial in number (from Canada and USA): |
1-888-390-0546 |
| • International or Local Toronto: |
1-416-764-8688 |
Conference Call Replay
If you cannot participate on August 9, 2018, a replay of the conference call will be available by dialing one of the following replay numbers. You will be able to dial in and listen to the conference 120 minutes after the meeting end time, and the replay will be available until August 16, 2018.
Please enter the Replay ID# 886356, followed by the # key.
Replay Dial in number
| • Toll free (from Canada or the USA): |
1-888-390-0541 |
| • International or Local Toronto: |
1-416-764-8677 |
About Pure Multi-Family REIT LP
Pure Multi-Family is a Canadian based, publicly traded vehicle which offers investors exclusive exposure to attractive, institutional quality U.S. multi-family real estate assets.
Additional information about Pure Multi-Family is available at www.puremultifamily.com and www.sedar.com.
Non-IFRS Financial Measures
This news release contains certain non-IFRS financial measures, including Pure Multi's interest, FFO, AFFO, same property NOI, rental revenue-same property, rental revenue-non-same property, net rental income, net rental income-same property, net rental income-non-same property, same property revenue, same property net rental income, same property average rent per occupied residential unit, average rent per occupied residential unit, same property physical occupancy, total portfolio leased occupancy, FFO payout ratio, AFFO payout ratio and any related per Unit amounts to measure, compare and explain Pure Multi-Family's operating results and financial performance. These measures are commonly used by entities in the real estate industry as useful metrics for measuring performance. However, they do not have any standardized meaning prescribed by IFRS and are not necessarily comparable to similar measures presented by other publicly traded entities because the method of calculation may differ. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with IFRS. Please refer to Pure Multi-Family's MD&A (available on SEDAR at www.sedar.com) for the three and six months ended June 30, 2018 for a reconciliation of the non-IFRS financial measures used herein to standardized IFRS measures.
Forward-Looking Information
Certain statements contained in this news release may constitute forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "plan", "expect", "may", "will", "intend", "should", and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements.
Although Pure Multi-Family believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Pure Multi-Family can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, competitive factors in the industries in which Pure Multi-Family operates, prevailing economic conditions, the failure to obtain necessary regulatory approvals or satisfy the conditions to closing any proposed acquisitions, and other factors, many of which are beyond the control of Pure Multi-Family.
The forward-looking statements contained in this news release represent Pure Multi-Family's expectations as of the date hereof, and are subject to change after such date. Pure Multi-Family disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.
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 THE ACCURACY OF THIS RELEASE.
SOURCE Pure Multi-Family REIT LP
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