Allied Properties Real Estate Investment Trust Announces Strong 2006 Results and Fourth Distribution Increase



    TORONTO, March 7 /CNW/ - Allied Properties REIT (TSX:AP.UN) today
announced results for the fourth quarter and fiscal year ended December 31,
2006. The REIT also announced that its trustees have approved an increase in
monthly cash distributions from $0.10167 per unit ($1.22 per unit annualized)
to $0.105 per unit ($1.26 per unit annualized) effective March, 2007. The
increased distribution will be payable on April 16, 2007, to unitholders of
record on March 30, 2007.

    Highlights
    "We're building a focused and successful real estate business," said
Michael Emory, President and CEO. "In 2006, we continued to execute our
strategy of accumulating Class I office properties in the urban areas of major
Canadian cities. By year-end, we had strong operating positions in Toronto,
Montreal, Winnipeg and Quebec City, and we intend to build on these strengths
going forward."

    
    In 2006, the REIT

    -   increased Distributable Income ("DI") per unit (diluted) to $1.414,
        up 5.6% from 2005,

    -   increased Funds From Operations ("FFO") per unit (diluted) to $1.527,
        up 2.5% from 2005,

    -   achieved a DI pay-out ratio of 85.3% and an FFO pay-out ratio of
        79.0%,

    -   increased annual same-asset net operating income ("NOI") by 4.4%,

    -   completed $115 million in acquisitions,

    -   reduced the weighted average interest rate on its mortgages to 5.9%,

    -   maintained a conservative debt ratio, ending the year at 48.2%, and

    -   maintained a high level of occupancy, ending the year with leased
        area of 96.3%.

    Fourth Distribution Increase
    The increase in monthly cash distributions announced today is the fourth
distribution increase since the REIT's IPO in February of 2003. It reflects
the REIT's two-fold objective of increasing distributions periodically while
at the same time maintaining conservative pay-out ratios.

    Financial Summary
    The REIT's financial results for the fiscal year ended December 31, 2006,
are summarized below and compared to the fiscal year ended December 31, 2005:

    (In thousands except for
    per unit and % amounts)             2006      2005    Change    % Change
    -------------------------------------------------------------------------

    Net income                         7,717     1,392     6,325      454.4%

    DI                                23,982    19,082     4,900       25.7%
    DI per unit (basic)               $1.442    $1.363    $0.079        5.8%
    DI per unit (diluted)             $1.414    $1.339    $0.075        5.6%
    DI pay-out ratio                   85.3%     87.9%     (2.6%)

    FFO                               25,911    21,229     4,682       22.1%
    FFO per unit (basic)              $1.558    $1.516    $0.042        2.8%
    FFO per unit (diluted)            $1.527    $1.490    $0.037        2.5%
    FFO pay-out ratio                  79.0%     79.0%         -

    -------------------------------------------------------------------------

    The REIT internalized property management in 2005. $7.9 million of the
transaction cost was expensed in the year ended December 31, 2005.
    The REIT's financial results for the fourth quarter ended December 31,
2006, are summarized below and compared to the fourth quarter ended
December 31, 2005:

    (In thousands except for
    per unit and % amounts)          Q4 2006   Q4 2005    Change    % Change
    -------------------------------------------------------------------------

    Net income (loss)                  1,053     1,963      (910)     (46.4%)

    DI                                 6,562     5,283     1,279       24.2%
    DI per unit (basic)               $0.356    $0.344    $0.012        3.4%
    DI per unit (diluted)             $0.349    $0.339    $0.010        3.0%
    DI pay-out ratio                   86.8%     86.7%     (0.1%)

    FFO                                7,125     5,782     1,343       23.2%
    FFO per unit (basic)              $0.386    $0.377    $0.009        2.6%
    FFO per unit (diluted)            $0.379    $0.370    $0.009        2.2%
    FFO pay-out ratio                  79.9%     79.2%      0.7%

    -------------------------------------------------------------------------
    

    The final component of the transaction cost in connection with the
internalization of property management, $0.9 million, was expensed in the
quarter ended December 31, 2006.
    NOI, DI and FFO are not financial measures defined by Canadian GAAP.
Please see the REIT's MD&A for a description of these measures and their
reconciliation to cash flow from operations or net income, as presented in the
consolidated financial statements of the REIT for the year ended December 31,
2006.

    Additional Financial Information
    The consolidated financial statements of the REIT for the year ended
December 31, 2006, together with accompanying notes and MD&A, have been filed
with SEDAR, www.sedar.com, and are available on the REIT's web-site,
www.alliedpropertiesreit.com.

    Cautionary Statements
    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 actual results
and performance of the REIT 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. 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 the Annual Information Form of the REIT
which is available at www.sedar.com. The 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 the parties undertake no obligation to
update such statements.

    Allied Properties REIT is a leading owner and manager of Class I office
properties in Canada, with portfolio assets in the urban areas of Montreal,
Quebec City, Toronto and Winnipeg. The objectives of the REIT are to provide
stable and growing cash distributions to unitholders and to maximize
unitholder value through effective management and accretive portfolio growth.





For further information:

For further information: Michael R. Emory, President and Chief Executive
Officer, (416) 977-9002, memory@alliedpropertiesreit.com

Organization Profile

ALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST

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