TORONTO, March 6, 2013 /CNW/ - NorthWest Healthcare Properties Real Estate Investment Trust (the "REIT") (TSX: NWH.UN), Canada's largest non-government owner and manager of medical office buildings and healthcare real estate, today announced its results for the three month period and year ended December 31, 2012.
Highlights of the Quarter:
- AFFO per Unit was $0.21 for the quarter.
- Occupancy was 91.2% at the end of the quarter.
- On December 20, 2012 the REIT acquired 245 Curé-Majeau, a recently expanded and renovated government healthcare administration building located in Joliette, Quebec, northeast of Montreal. The property was purchased for $10 million free and clear of mortgages, and is expected to be immediately accretive. The REIT secured new 10-year mortgage financing for $7.5 million on the property at a fixed interest rate of 4.07%. Comprised of 53,771 square feet, 245 Curé-Majeau is leased exclusively on a long term basis (until 2023) to the Agence de la Santé et des Services Sociaux de Lanaudière (CSSS), a regional health authority responsible for deployment of management and the allocation of financial resources to area healthcare facilities, including several local hospitals. The investment was the REIT's sixteenth asset in the Province of Quebec.
- On November 16, 2012 the REIT acquired an eleven property medical office building portfolio in Ontario (the "GT Portfolio") from a subsidiary of NorthWest International Healthcare Properties REIT, formerly GT Canada Medical Properties REIT and hereinafter "GT REIT", controlled by NorthWest Value Partners Inc. ("NWVP"), by way of share and unit transactions, with an effective date of October 1, 2012. The purchase price, as adjusted on closing, together with reimbursement of certain transaction costs, was $36.3 million, plus the assumption of mortgage debt of approximately $43.3 million. The purchase price, as adjusted, and transaction costs were satisfied by a cash payment of $6.3 million and a note in the amount of $30 million bearing interest at 8% (the "GT Note") and is expected to be immediately accretive.
- On November 16, 2012 the REIT issued 1,746,142 Units to NorthWest Operating Trust ("NW Trust"), which is controlled by NWVP, in a private placement at a subscription price of $12.3125 per Unit for net proceeds of approximately $21.4 million.
- On November 14, 2012 the REIT acquired a medical office building municipally known as 249 Ontario Street, Port Hope from GT REIT, by way of share and unit transactions, with an effective date of October 1, 2012. The purchase price was $2.9 million, plus the assumption of mortgage debt of approximately $5.0 million, subject to usual adjustments, and is expected to be immediately accretive.
- During the quarter NWVP repaid in full the $41.3 million 7% loan from the REIT by a cash payment of $11.3 million plus accrued interest and with the $30 million balance set-off against the GT Note.
- The REIT paid distributions of $0.06667 per Unit on October 15, 2012, November 15, 2012 and December 14, 2012 consistent with its annualized target of $0.80 cents per Unit.
Peter Riggin, CEO, commented that "The fourth quarter was a positive conclusion to a productive 2012 that saw the REIT enhance our market leading position in the ownership of healthcare real estate through accretive acquisitions of approximately $170 million, while also maintaining a reasonable 51.6% debt to gross book value ratio and reducing our weighted average mortgage interest rate to 4.93% as we took advantage of favourable borrowing conditions. While operationally we would have preferred to see more improvement in our portfolio occupancy, we are encouraged by momentum achieved in the fourth quarter and we remain disciplined about increasing the healthcare quotient of our tenant base, whenever possible."
Selected Financial Information:
|(unaudited)||Three Months Ended||Three Months Ended|
|($000's, except unit and per unit amounts)||December 31, 2012||December 31, 2011|
|Net Operating Income||20,075||17,013|
|Funds from Operations ("FFO")||11,651||10,055|
|Adjusted Funds from Operations ("AFFO")(1)||9,664||8,504|
|Debt to Gross Book Value||51.6%||50.2%|
|Per unit data (Annualized, fully diluted)|
|AFFO Payout ratio||94%||101%|
|(1)||AFFO amounts are calculated utilizing leasing and capital reserves of 4.5% of revenue.|
- On January 31, 2013 the REIT acquired an additional office condominium unit within the Smyth Medical Centre in Ottawa. Following the transaction, the REIT's ownership stake within the building increased to approximately 44% of the condominium units and 83% of the parking units. The unit was acquired free and clear of mortgage financing and is expected to be immediately accretive. Negotiations and due diligence respecting the acquisition of additional condominium units in the building continue.
- On February 28, 2013, the REIT repaid in full upon maturity the $1.0 million of mortgage debt secured against the Welland Professional Arts Building located in Welland, Ontario.
- The REIT declared distributions of $0.06667 per Unit to Unitholders of record as at January 31, 2013 and February 28, 2013.
- On March 1, 2013 the REIT sold the small and non-strategic 1955 King Street East, Hamilton property, which it had acquired as part of the GT Portfolio, for $1.26 million, subject to adjustments, and repaid the mortgage debt thereon.
The non-GAAP measures used in this press release, such as FFO and AFFO, are key financial measures used by the real estate industry to measure and compare the operating performance of real estate companies, but they do not have any standardized meaning prescribed by Canadian generally accepted accounting principles ("GAAP"). As such, they are unlikely to be comparable to similar measures presented by other real estate companies. These non-GAAP measures are more fully defined and discussed in the REIT's management discussion and analysis (the "MD&A") for the fourth quarter of 2012, which is available on the SEDAR website at www.sedar.com. Also on SEDAR are the audited 2012 year-end financial statements of the REIT.
This press release may contain forward-looking statements with respect to the REIT, its operations, strategy, financial performance and condition. These statements generally can be identified by use of forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe", or "continue" or the negative thereof or similar variations. The REIT's actual results and performance discussed herein could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations, including that the transactions contemplated herein are completed. Important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, changes in government regulations and the factors described under "Risk Factors" in REIT's Prospectus and the risks and uncertainties set out in the MD&A which are available on www.sedar.com. These cautionary statements qualify all forward-looking statements attributable to the REIT and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release, and, except as expressly required by applicable law, the REIT assumes no obligation to update such statements.
The REIT invites you to participate in its conference call with senior management to discuss our fourth quarter 2012 results on Thursday, March 7, 2013 at 9:00 a.m. (Eastern).
The conference call can be accessed by dialing (416) 640-5926 or 1-800-820-0231. The conference ID is 2084332.
Audio replay is available until March 13, 2013 by dialing 647-436-0148 or 1-888-203-1112. The passcode is 2084332.
The webcast of the conference call can be accessed from the "Investor Relations" page of the REIT's web site at www.nwhp.ca, and will be archived for 30 days.
About NorthWest Healthcare Properties Real Estate Investment Trust
NorthWest Healthcare Properties Real Estate Investment Trust is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. The REIT holds a portfolio of 76 income-producing properties, with a focus on medical office buildings and healthcare real estate, comprising approximately 4.6 million square feet of gross leasable area located in British Columbia, Alberta, Ontario, Québec, Nova Scotia and New Brunswick.
SOURCE NorthWest Healthcare Properties Real Estate Investment Trust