Morguard Real Estate Investment Trust Announces 2011 First Quarter Results

MISSISSAUGA, ON, May 9 /CNW/ - Morguard Real Estate Investment Trust ("the Trust") (TSX: MRT.UN) today announced its financial results for the three months ended March 31, 2011 ("Q1").

Morguard REIT's Q1 2011 Consolidated Financial Statements and Management's Discussion and Analysis along with its 2010 Annual Report are available on Morguard REIT's website at www.morguardreit.com and have been filed with SEDAR at www.sedar.com.

HIGHLIGHTS

  • The Trust's financial statements for the three months ended March 31, 2011 have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").  Results previously reported under Canadian GAAP have been restated under IFRS for comparative purposes.  A reconciliation of the IFRS results as reported to a Canadian GAAP equivalent has been included in the financial statements.

  • Net operating income for Q1 2011, increased to $31.9 million from $27.9 million for the same period in 2010.

  • Net income for Q1 2011 totalled $23.3 million or $0.41 per-unit (basic) and $0.40 per-unit (diluted) compared to $11.6 million or $0.20 per-unit (basic and diluted) for the same period in 2010.  In 2011, net income was significantly affected by the full impact of acquisitions made during 2010, and fair value gains on real estate properties.

  • Funds from operations ("FFO") increased to $19.6 million or $0.35 per-unit (basic) and $0.33 per-unit (diluted) compared to $16.7 million or $0.29 per-unit (basic and diluted) for the same period in 2010.

  • Overall portfolio occupancy levels were at 95%.

Net Income

(In thousands of dollars, except per-unit amounts)
For the three months ended March 31,
       2011  2010
             
Revenue from real estate properties       $      57,806 $    51,462
Net operating income            31,903    27,855
Income before fair value changes on real estate properties       18,027 15,280
Fair value gain/(losses) on real estate properties             5,300 (3,673)
Net income for the period       $      23,327 $    11,607
           
Net income per-unit          
     Basic       $ 0.41 $ 0.20
     Diluted       $ 0.40 $ 0.20

Funds from Operations

The real estate industry has adopted a measure of FFO to supplement net income as an operating performance measurement.  The Trust's calculation of FFO is consistent with the definition provided by the Real Property Association of Canada ("REALPac").

FFO is defined as net income adjusted for amortization of tenant allowances, accretion of convertible debentures and fair value gain or loss on real estate properties.  FFO per-unit is calculated by dividing FFO attributable to unitholders by the weighted average number of units outstanding for the period.

FFO was calculated as follows:

(In thousands of dollars, except per-unit amounts)
For the three months ended March 31,
       2011  2010
           
Net income for the period       $      23,327 $    11,607
           
Add/(deduct) items not affecting cash:          
Amortization - Tenant incentives       1,263     1,187
Accretion of convertible debentures       349                   232
Fair value (gain)/loss on real estate properties       (5,300) 3,673
Funds from operations        $     19,639 $    16,699
           
Funds from operations per-unit          
   Basic                           $0.35 $ 0.29
   Diluted       $0.33 $ 0.29

Readers are cautioned that although the terms "Net Operating Income" and "Funds from Operations" are commonly used to measure, compare and explain the operating and financial performance of Canadian real estate investment trusts and such terms are defined in the Management's Discussion and Analysis, such terms are not recognized terms under IFRS.  Such terms do not necessarily have a standardized meaning and may not be comparable to similarly titled measures presented by the other publicly traded entities.

Morguard is a closed-end real estate investment trust, which owns a diversified portfolio of 51 retail, office, and mixed-use properties in Canada with a book value of $1.9 billion and approximately 8.3 million square feet of leasable space.  For more information, visit the Trust's website at www.morguardreit.com.

SOURCE Morguard Real Estate Investment Trust

For further information:

Rai Sahi, President and Chief Executive Officer, Tel: 905.281.4800, or;
Tim Walker, Vice President and Chief Financial Officer, Tel: 905.281.4800


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