Starlight U.S. Multi-Family Core Fund Announces Robust Fourth Quarter and Full Year 2015 Results

/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

TORONTO, April 12, 2016 /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 December 31, 2015 (the "Fourth Quarter") and for the year ended December 31, 2015 (the "Year End").  All amounts in this news release are in thousands of United States dollars and excludes the Fund's non-controlling interest in The Falls at Eagle Creek and includes the Fund's revenues, expenses, assets and liabilities of its investments in joint venture investments in Soho Parkway Apartments, The Villages of Sunset Ridge, Belle Haven Apartments and Sorelle Apartments unless otherwise stated.  

Fourth Quarter Highlights

  • Same property rents grew from $1,076 to $1,135 in the Fourth Quarter when compared to the fourth quarter of 2014, representing an increase of 5.5% and have increased by 5.0% on annualized basis since the Fund's inception.
  • Same property revenue growth was 4.4% in the Fourth Quarter and 6.6% for the Year End.
  • Same property net operating income ("NOI") growth was 3.6% for the Fourth Quarter and 7.4% for the Year End.
  • The weighted average portfolio occupancy was 94.4% for the Year End compared to 94.9% during the same period last year, reflecting the Fund's continued optimization of rental rates to drive overall revenue increases.
  • Adjusted funds from operations ("AFFO") payout ratio was a conservative 44.5% for the Fourth Quarter and improved from 53.6% for the fourth quarter of 2014 and from 52.5% for the third quarter of 2015.
  • The Fund recognized an additional $5.5 million fair value increase on its investment properties during the Fourth Quarter and has recognized a $42.8 million increase since inception driven by continued NOI growth and capitalization rate compression.
  • Interest coverage ratio for the Fourth Quarter was 2.81 times and the indebtedness coverage ratio, which includes principal repayments, was 2.23 times.
  • The Fund's weighted average interest rate was 3.00% as of December 31, 2015 and the weighted average term to maturity was 4.46 years.
  • Indebtedness to gross book value was 61.1%, at the lower end of the Fund's targeted leverage range.
  • On February 10, 2016, the Fund sold Bridgemoor at Denton and on February 26, 2016 reinvested the proceeds from the sale in The Village at Marquee Station in Raleigh, North Carolina.

Operating Results

Property revenues for the Year End were $20,364 compared to $16,371 in 2014 and NOI was $11,525 compared to $9,236 in 2014. Same property revenue growth for the Year End was $957 or 6.6% and same property NOI growth for the Year End was $606 or 7.4%. Portfolio occupancy was 94.4% during the Fourth Quarter compared to 94.9% during the three months ended December 31, 2014, in both cases at the high end of the Fund's targeted occupancy range. Same property rents grew from $1,076 to $1,135 in the Fourth Quarter compared to the fourth quarter of 2014, representing an increase of 5.5% and have increased by 5.0% on annualized basis since the Fund's inception.

Financial Position

As of December 31, 2015, the Fund's gross book value was $230.3 million and indebtedness was $140.7 million or 61.1% of gross book value. Indebtedness as a percentage of gross book value was at the lower end of the Fund's targeted range of 60%-70%. The interest coverage ratio for the Fourth Quarter was 2.81 times and for the Year End was 2.87 times. The ratios remained consistent and healthy throughout 2015. The weighted average interest rate on the Fund's mortgage portfolio increased slightly to 3.00% from 2.81% when comparing 2015 to the prior year as a result of the Fund's acquisitions during 2015 and increases in U.S. 30 day LIBOR rates.

Subsequent Events

On March 2, 2016, the Fund announced that the term of the Fund had been extended by up to one year in accordance with provisions of the Fund's fourth amended and restated limited partnership agreement dated August 20, 2014.

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 consolidated financial statements and management's discussion and analysis for the period, and any other information relating to the Fund, please visit www.sedar.com. 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 also available in the Fund's April 2016 Newsletter which is available on the Fund's profile at www.starlightus.com.

Non-IFRS Financial Measures

Certain terms used in this news release including NOI, AFFO, gross book value, indebtedness, interest coverage ratio and indebtedness coverage ratio are not measures defined under International Financial Reporting Standards ("IFRS") 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 period available on the Fund's profile at www.sedar.com.

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: To learn more about Starlight U.S. Multi-Family Core Fund, visit www.starlightinvest.com or contact: Evan Kirsh, President, Starlight U.S. Multi-Family Core Fund, 647-725-0417, ekirsh@starlightus.com


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