Plaza Retail REIT announces 14.2% growth in FFO per unit

FREDERICTON, Feb. 26, 2015 /CNW/ - Plaza Retail REIT (TSX: PLZ.UN) ("Plaza") today announced its results for the year ended December 31, 2014.

Plaza reported funds from operations ("FFO") of $27.2 million for the year ended December 31, 2014, an increase of 41.0% over the prior year.  FFO per unit was $0.297 for the year ended December 31, 2014 ($0.297 per unit diluted), an increase of 14.2% over the prior year.  FFO was positively impacted by growth in total net property operating income and same-asset net property operating income and net property operating income from the acquisition of KEYreit.

Plaza reported FFO of $6.8 million for the three months ended December 31, 2014, an increase of 39.6% over the same period in the prior year.  FFO per unit was $0.073 for the quarter ended December 31, 2014 ($0.073 per unit diluted), an increase of 28.1% over the same period in the prior year.

Plaza's significant growth was partly driven by the following achievements during 2014.  Plaza:  (1) obtained or refinanced approximately $165 million in mortgage loans and convertible debentures (at Plaza's ownership percentage), generating approximately $1.4 million in annual cash flow savings, or approximately $0.015 per unit; (2) continued to extract value from the acquisition of KEYreit, including realizing synergies in administrative expenses amounting to $3.0 million per year, refinancing almost half of the KEYreit mortgage loans and debentures resulting in cash flow savings of approximately $1.3 million per year, selling $60.3 million of non-core properties at well-above Plaza's underwritten value by approximately $15.1 million, and beginning redevelopment of sites to fit new tenants; and (3) spent $34.4 million in developments/redevelopments and added $1.0 million in incremental NOI from 2013 and 2014 projects that became income producing.

The year was also marked by a number of other important achievements, including:  (1) converting to a REIT structure; (2) purchasing the interests of certain equity partners in eight properties located in New Brunswick and Prince Edward Island effective January 1, 2015 which is accretive to Plaza; and (3) announcing the 12th annual increase in distributions to 25¢ per unit for 2015, up from 24¢ per unit in 2014.

Michael Zakuta, President and CEO said, "We are very pleased with the financial results for 2014.  Those results reflect the impact of our substantial refinancing program, growth from our development pipeline and our KEYreit value extraction initiatives.  The growth in FFO continues to confirm our business strategy that is based on creating value for our unitholders by being opportunistic and by developing and redeveloping high quality retail projects leased to national retailers and financing these projects with long term fixed rate financing for terms of ten years or more."

A copy of Plaza's annual report can be found on Plaza's web site at www.plaza.ca or on SEDAR at www.sedar.com.

Plaza is an open-ended real estate investment trust and is a leading retail property owner and developer, particularly in Eastern Canada.  Plaza's current portfolio includes interests in 308 properties totaling approximately 6.7 million square feet across Canada and additional lands held for development. Plaza's properties include a mix of strip plazas, stand-alone small box retail outlets and enclosed shopping centres, anchored by approximately 90% national tenants.

CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING INFORMATION

This news release contains forward looking statements relating to our operations and the environment in which we operate, which are based on our expectations, estimates, forecasts and projections.  These statements are not future guarantees of future performance and involve risks and uncertainties that are difficult to control or predict.  Therefore, actual outcomes and results may differ materially from those expressed in these forward looking statements.  Readers, therefore, should not place undue reliance on any such forward looking statements.  Further, a forward looking statement speaks only as of the date on which such statement is made.  We undertake no obligation to publicly update any such statement, to reflect new information or the occurrence of future events or circumstances, except for forward-looking information disclosed in prior disclosures which, in light of intervening events, requires further explanation to avoid being misleading.

The TSX does not accept responsibility for the adequacy or accuracy of this release.

 

SOURCE Plaza Retail REIT

For further information: on Plaza Retail REIT, visit our website at www.plaza.ca, or contact: Floriana Cipollone, Chief Financial Officer (416) 848-4583 or Kim Sharpe, Director of Business Development at (506) 460-8261

RELATED LINKS
http://www.plaza.ca

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