NPR reports Q3 2011 results

CALGARY, Nov. 8, 2011 /CNW/ - Northern Property REIT and NorSerCo Inc. (NPR.UN - TSX) announced its results for the 3 and 9 months ended September 30, 2011.  The Financial Statements and MD&A for the entities are reported on a condensed combined basis at under Northern Property Real Estate Investment Trust.


  • Vacancy loss declines to 4.8% compared to 5.3% same quarter last year
  • FFO per stapled unit increases to $1.75 from $1.66 for three quarters last year
  • FFO payout ratio for nine months declines to 64.8%
  • New apartment markets:  Labrador City, Saskatoon and Courtenay

Financial Performance at a Glance

(Thousands of dollars except per unit amounts) Three Months
Ended September 30
Nine Months
Ended September 30
Financial Information 2011 2010 2011 2010
Total revenue 41,276 35,902 116,085 103,748
Net operating income 28,198 24,387 76,884 68,203
Net and comprehensive earnings (loss) 13,672 1,773 54,518 (81,760)
Net earnings (loss) per stapled unit, basic * $0.465 $0.068 $1.921 ($3.254)
FFO 18,488 15,247 49,826 41,771
FFO per stapled unit, basic * $0.628 $0.604 $1.755 $1.659
FFO payout ratio 60.9% 64.1% 64.8% 67.9%
Distributions declared to stapled unit holders 11,256 9,049 32,768 14,775
Interest paid to unitholders - 720 - 13,604
Distributions paid to stapled unitholders 11,250 8,699 32,276 11,560
Distributions per stapled unit * $0.383 $0.378 $1.148 $1.118

* Per unit calculations are based on the weighted average number of Stapled Units outstanding for the periods ended September 30, 2011 and 2010.

"NPR's property portfolio delivered improved financial results in Q3" said Jim Britton, President and CEO.  "Our overall vacancy rate had been stalled at the 5% level for the first two quarters of 2011 but began to improve late in the third quarter.  This, coupled with seasonally low operating costs contributed to the REIT reaching a record quarterly $0.628 FFO per unit."

Overall apartment vacancy declined to 4.8% for Q3, 2011 compared with 5.3% which was experienced in the same quarter a year earlier.  Vacancy was 5.0% in Q2 of 2011.  Same door NOI growth was 3.6% over the level of Q3 2010.   The NPR Executive Suite operation joined by two hotels in Iqaluit had a strong showing for the quarter.   Seniors operations and commercial operations were steady.  Trust administration costs were higher than last quarter as a result of additional acquisition staff, a high level of mortgage redocumentations and higher audit fees associated with IFRS.

"Our strategic process respecting our seniors' portfolios continues," Mr. Britton said. "NPR is negotiating potential sales directly with most of our tenants in Newfoundland.  Our strategic advisory firm, Brookfield Financial, is well underway with its work respecting our portfolio of seniors' buildings in Alberta and British Columbia.  We hope to be able to provide greater certainty respecting our long term intentions in the seniors' field by the end of the year."

On the acquisition front, the previously announced $79 million Iqaluit portfolio acquisition was completed with the closing of the Qamutiq office building on September 1.   The REIT also acquired 105 apartment units during the quarter in Nanaimo and in Fort St. John, British Columbia.  Subsequent to the end of the quarter the REIT launched initiatives to enter new apartment markets by closing on 53 units in Labrador City, entering into a purchase agreement to acquire a 240 unit apartment complex in Saskatoon and agreed to buy 33 units in Courtenay,BC, near Nanaimo.

Lease up of the 32 unit luxury apartment complex completed in mid September in Iqaluit was at 87% by November 1st.  Construction of 79 apartment units in Iqaluit is well underway.  The REIT is working to assemble apartment development lands as part of its intention to ramp up development activity in the face of high apartment asking prices and very low vacancies in certain markets.

NPR is studying its options respecting the July 20, 2011 announcement of the Minister of Finance on special taxation measures for stapled unit structures.  The recently tabled Federal budget did not include legislation respecting the increase in REIT non-qualifying income to the promised 10% level.  Jim Britton said, "NPR's stapled unit structure will remain in place at least until the 10% rule is enacted which we trust will occur in the next few months.  We do not foresee major effort or expense thereafter in adjusting our structure to conform to the various ministerial pronouncements."

To view the full MD&A and Financial Statements for Q3 2011, visit, or


SOURCE Northern Property Real Estate Investment Trust

For further information:

David Leiman, CFO, (403) 531-0720.

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Northern Property Real Estate Investment Trust

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