/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES/
TORONTO, Nov. 6, 2013 /CNW/ - Starlight U.S. Multi-Family Core Fund (TSX.V: UMF.A, UMF.U) (the "Fund") today announced its results of operations and financial condition for
the three months ended September 30, 2013 (the "Third Quarter") and period from February 12, 2013 (date of formation) to September
30, 2013. The results and financial condition reflect operations for
the Fund's initial portfolio, comprised of three properties, that was
acquired on April 23, 2013, as well as the acquisition of Greenhaven
Apartments on July 29, 2013 and the acquisition of a 35% interest in
the Falls at Eagle Creek on September 16, 2013.
The forecast figures below represent the financial forecast ("Forecast") as stated in the final long form prospectus of the Fund dated March
31, 2013. All dollar amounts set out in this news release are United
States currency unless otherwise noted.
Full condensed consolidated financial results and related management's
discussion and analysis are available on the Fund's profile at www.sedar.com. In addition, further details regarding the Fund's unit performance and
distributions, market conditions where the Fund's properties are
located, performance by the Fund's properties and a capital investment
update are available in the Fund's October 2013 Newsletter which is
available at http://starlightinvest.com/starlight-u-s-multi-family-core-fund and at www.sedar.com.
THIRD QUARTER HIGHLIGHTS
Weighted Average occupancy for the period from February 12, 2013 to
September 30, 2013 was 95.8% or 1.8% above the Forecast.
Net Operating Income ("NOI") in relation to the initial portfolio was 4.5% above the Forecast for
the third quarter and was 6.4% above the Forecast for the period from
February 12, 2013 to September 30, 2013.
Adjusted Funds from Operations ("AFFO") payout ratio for the Third Quarter was 84.2% and 80.5% for the period
from February 12, 2013 to September 30, 2013.
Excluding the Fund's non-controlling interest in the Falls at Eagle
Creek, the Fund's indebtedness was 61.89% of gross book value.
Subsequent to the completion of the Third Quarter, the Fund announced
its cash distribution for the month of October representing the full
deployment of the proceeds of the initial public offering.
Evan Kirsh, the Fund's President commented, "The Fund is now fully deployed with results to date that are ahead of
the Forecast. The Manager of the Fund continues to pursue opportunities
to increase the Fund's NOI by increasing rental rates at each property,
adding ancillary revenue opportunities and providing tenants with a
menu of in-suite, upgrade option items. Performance at the Fund's
properties not only reflects the strength of the local markets in Texas
but also reflects the Fund's ability to leverage the expertise of its
Manager and local third party property managers."
For the Third Quarter, property revenues and NOI, excluding the Fund's
non-controlling interest in the Falls at Eagle Creek, were $2.83
million and $1.69 million, respectively. At the conclusion of the Third
Quarter, average monthly rent was $978 and weighted average portfolio
occupancy was 95.6% after removing the Fund's non-controlling interest.
As of September 30, 2013, the Fund's gross book value was $155.53
million and indebtedness was $101.24 million or 65.09%. Excluding the
Fund's non-controlling interest in the Falls at Eagle Creek, the Fund's
gross book value was $128.41 million and indebtedness was $79.47 or
61.89%. The interest coverage ratio for the Third Quarter was 2.80
times after removing the Fund's non-controlling interest in the Falls
at Eagle Creek. Both these metrics fall within the Fund's stated
targets. The weighted average interest rate on the Fund's mortgage
portfolio was 3.33%, and the weighted average term to maturity was 3.74
years after removing the Fund's non-controlling interest in the Falls
at Eagle Creek.
The Fund's weighted average occupancy of its properties for the period
from February 12, 2013 to September 30, 2013 was 95.8%, which was 1.8%
above the Forecast. The increase in occupancy is attributable to strong
market dynamics, the seasonal leasing impact in Dallas and Houston and
the earlier than expected deployment of the proceeds of the Fund's
initial public offering.
Given the strong occupancies at the properties, the Fund has
aggressively increased rental rates on both new and renewal leases and
curtailed concessions. Renewal rents for existing tenants are being
increased between 2.5% and 10% depending upon current tenant rents
versus current asking rents. Asking rents for new tenants are being
increased by up to 9% versus asking rents when the properties were
acquired. Only moderate concessions are currently being offered on new
leases at any of the Fund's properties.
About Starlight U.S. Multi-Family Core Fund
The Fund is a limited partnership formed under the Limited Partnerships Act (Ontario) for the primary purpose of indirectly acquiring, owning and
operating a portfolio of diversified income producing rental properties
in the U.S. multi-family real estate market.
For complete financial statements and management's discussion and
analysis for the period, and any other information relating to the
Fund, please visit www.sedar.com.
Non-IFRS Financial Measures
Certain terms used in this news release including NOI, AFFO, gross book
value, indebtedness and interest coverage ratio are not measures
defined under International Financial Reporting Standards as prescribed
by the International Accounting Standard Board. Details on non-IFRS
financial measures are set out in the Fund's management's discussion
and analysis for the Third Quarter available on the Fund's profile at www.sedar.com.
This news release contains statements that may constitute
forward-looking statements within the meaning of Canadian securities
laws and which reflect the Fund's current expectations regarding future
events, including statements regarding financial position, business
strategy, budgets, litigation, national and local real estate market
conditions and economic variables, occupancy rates, projected costs,
capital expenditures, financial results, taxes, plans and objectives,
future results, performance, achievements, prospects or opportunities
for the Fund or the real estate industry. In some cases,
forward-looking statements can be identified by terms such as "may",
"might", "will", "could", "should", "would", "occur", "expect", "plan",
"anticipate", "believe", "intend", "seek", "aim", "estimate", "target",
"project", "predict", "forecast", "potential", "continue", "likely",
"schedule", or the negative thereof or other similar expressions
concerning matters that are not historical facts.
The forward-looking statements in this news release involve risks and
uncertainties, including those set forth in the Fund's materials filed
with the Canadian securities regulatory authorities from time to time
at www.sedar.com. Actual results could differ materially from those projected herein.
Those risks and uncertainties include, among other things, risks
related to: reliance on the Fund's manager; the experience of the
Fund's officers and directors; substitutes for residential real estate
rental suites; reliance on property management; competition for real
property investments and tenants; anticipated future growth of the
Fund; United States market factors; and exchange rates.
Information contained in forward-looking statements is based upon
certain material assumptions that were applied in developing such
forward-looking statements including management's perceptions of
historical trends, current conditions and expected future developments,
as well as other considerations that are believed to be appropriate in
the circumstances, including the following: the extent of competition
between properties; the ability of the manager of the Fund to manage
and operate the properties; the inventory of multi-family real estate
properties; the population of multi-family real estate market
participants; assumptions about the markets in which the Fund operates;
the global and North American economic environment; foreign currency
exchange rates; and governmental regulations or tax laws. Readers are
cautioned against placing undue reliance on forward-looking statements.
Except as required by applicable Canadian securities laws, neither the
Fund nor its manager undertakes any obligation to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise, after the date on which the
statements are made or to reflect the occurrence of unanticipated
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 accuracy of this release.
SOURCE: Starlight U.S. Multi-Family Core Fund
For further information:
President, Starlight U.S. Multi-Family Core Fund