NorthWest Healthcare Properties Real Estate Investment Trust releases second quarter results

TORONTO, Aug. 12, 2014 /CNW/ - NorthWest Healthcare Properties Real Estate Investment Trust (the "REIT") (TSX: NWH.UN), Canada's largest non-government owner and operator of medical office buildings and healthcare real estate, today announced its results for the three and six months ended June 30, 2014.

Highlights of the Quarter:

  • AFFO per unit for the quarter was $0.21, consistent with that of the comparable prior year quarter.
  • FFO per unit for the quarter was $0.25, consistent with that of the comparable prior year quarter.
  • Occupancy was 92.1%, an improvement from the previous quarter at 91.8%.
  • During the quarter the REIT sold a non-core property in Toronto, Ontario (2065 Finch Avenue West) for approximately $10 million, before adjustments, resulting in net proceeds of approximately $2.9 million after transaction costs and mortgage assumption.
  • During the quarter the REIT obtained new financing for its Springbank Medical Centre with a $15.5 million fixed rate mortgage, at 3.36% for a 5 year term.
  • During the quarter, the REIT refinanced its CSSS du Haut-Richelieu Marieville and CSSS Grand Littoral properties with fixed rate mortgages of $6.4 million and $8.4 million, respectively, at 4.53% (previous rates at 4.91%) for 10 year terms, resulting in net proceeds to the REIT of approximately $3.0 million.
  • During the quarter, the REIT repaid a maturing mortgage at The Stewart Building of $10.4 million at 5.07% and substituted the property for Rockyview Health Centre II as security for the Revolving Credit Facility. Rockyview Health Centre II remains unencumbered.
  • The REIT early repaid the mortgage at its Mira Health Centre of $10.5 million at 5.76% and subsequent to the quarter entered into a first mortgage financing commitment for $15.0 million which is anticipated to close in the third quarter.
  • The REIT paid distributions of $0.06667 per Unit on April 15, 2014, May 15, 2014 and June 13, 2014 consistent with its annualized target of $0.80 cents per Unit.

Peter Riggin, CEO, commented that "We are pleased with our portfolio's improved occupancy, the reduced interest rates we are achieving on our maturing mortgage debt and our progress on our plan to dispose of non-core assets, as this will improve future performance of the portfolio."

Selected Financial Information:




(unaudited)

Three Months Ended

Three Months Ended

($000's, except unit and per unit amounts)

June 30, 2014

June 30, 2013(1)




Revenue

$37,411

$36,882

Net Operating Income

$20,554

$20,206

Funds from Operations ("FFO")

$11,780

$11,777

Adjusted Funds from Operations ("AFFO")

$9,966

$9,501

Debt to Gross Book Value

54.9%

52.1%




Per unit data



FFO

$0.25

$0.25

AFFO

$0.21

$0.21

Distributions

$0.20

$0.20

AFFO Payout ratio

93%

97%


(1) FFO and AFFO for the three months ended June 30, 2013 have been restated to conform with current year presentation.


 

Subsequent Events:

  • The REIT entered into a contract for the sale of its 304 Victoria Avenue North in Hamilton Ontario, which sale is expected to be completed in the fourth quarter of 2014
  • The REIT entered into a mortgage financing commitment to refinance its New Glasgow Medical Centre asset with a new ten year first mortgage of $7.3 million at a fixed rate to be set (existing mortgage of $6.7 million at 5.07% to be repaid). The REIT has also entered into a first mortgage financing commitment to finance its Mira Health Centre for $15 million which is anticipated to close in the third quarter.
  • At the REIT's HealthPark property in Sydney NS, phased early occupancy of a managed family practice clinic comprising approximately 4,400 square feet of head lease space will commence in the third quarter of 2014, with rent commencing in early 2015
  • The REIT declared distributions of $0.06667 per Unit to Unitholders of record as at July 31, 2014.

Some financial measures used in this press release, such as FFO and AFFO, are 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 IFRS. As such, they are unlikely to be comparable to similar measures presented by other real estate companies. These non-IFRS measures are more fully defined and discussed in the REIT's management discussion and analysis (the "MD&A") for the second quarter of 2014, which is available on the SEDAR website at www.sedar.com.  Also on SEDAR are the interim 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 "Risks and Uncertainties" in the REIT's Annual Information Form 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 second quarter 2014 results on Wednesday, August 13, 2014 at 11:00 a.m. (Eastern). The conference call can be accessed by dialing 416-260-0113 or 800-524-8950. The conference ID is 5272555.

Audio replay will be available until Tuesday, August 19 by dialing 647-436-0148 or 888-203-1112. The passcode is 5272555.

Following the call, the webcast can be accessed from the "Investor Relations" page, under "Webcasts & Presentations", 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 75 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, Manitoba, Ontario, Québec, Nova Scotia and New Brunswick.

SOURCE NorthWest Healthcare Properties Real Estate Investment Trust

For further information: Ernie Spraggs, CFO, (416) 601-3221 or www.nwhp.ca