STARLIGHT WESTERN CANADA MULTI-FAMILY (NO. 2) FUND ANNOUNCES Q3-2025 OPERATING RESULTS INCLUDING YEAR-OVER-YEAR RENT GROWTH OF 2.6%

TORONTO, Nov. 18, 2025 /CNW/ - Starlight Western Canada Multi-Family (No. 2) Fund (the "Fund") announced today its results of operations and financial condition for the three months ended September 30, 2025 ("Q3-2025") and nine months ended September 30, 2025 ("YTD-2025"). Certain comparative figures are included for the Fund's financial and operational performance as at December 31, 2024, for the three months ended September 30, 2024 ("Q3-2024") and for the nine months ended September 30, 2024 ("YTD-2024").

All amounts in this press release are in thousands of Canadian dollars except for average monthly rent ("AMR")¹, or unless otherwise stated.

"We are pleased to announce another quarter of strong operating results with the Starlight Western Canada Multi-Family (No. 2) Fund achieving year-over-year net operating income growth of 2.5%," commented Neil Fischler, Executive Vice President. "Management continues to focus on increasing net operating income at its properties."

Q3-2025 HIGHLIGHTS

• The Fund achieved AMR growth of approximately 2.6% between Q3-2024 and Q3-2025, continuing to be driven by sustained demand for multi-family suites due to continuing economic resilience and overall immigration levels in Canada and Vancouver Island and the mainland of the Province of British Columbia ("BC") (collectively, the "Primary Markets").
• Revenue from property operations and net operating income ("NOI")¹ for Q3-2025 were $5,477 and $3,864 (Q3-2024 - $5,502 and $3,769), respectively, representing a decrease in revenue of 0.5% primarily due to a reduction in economic occupancy¹ in Q3-2025 relative to Q3-2024, partially offset by AMR growth achieved between the two periods, and an increase in NOI of 2.5% relative to Q3-2024.
• The Fund reported physical occupancy¹ of 97.1% for the nine multi-family properties owned (the "Properties") as at September 30, 2025.
• The Fund reported a net income and comprehensive income attributable to the unitholders of the Fund (the "Unitholders") for Q3-2025 of $511 (Q3-2024 - $710).
• The Fund had approximately $3,105 of available liquidity as at September 30, 2025, including $2,500 of availability under the Fund's credit facility secured by Nanaimo 2.
• As at November 17, 2025, the Fund had collected approximately 99.2% of rents for Q3-2025, with further amounts expected to be collected in future periods, demonstrating the Fund's high quality resident base and operating performance.
• Adjusted funds from operations ("AFFO")¹ for Q3-2025 was $1,044 (Q3-2024 - $847), representing an increase of $197 or 23.3% relative to Q3-2024, primarily due to the increase in NOI described above as well as lower finance costs and fund and trust expenses between the two periods.
• Subsequent to September 30, 2025, the Fund announced a proposed business combination with the Starlight Western Canada Multi-Family Limited Partnership, comprising of six multi-family properties to create a single investment platform comprising of fifteen multi-family properties totaling 1,413 suites, including the Fund's existing portfolio of nine multi-family properties across Primary Markets, with an estimated aggregate value of $639,400 (see "Future Outlook" and "Subsequent Events").

¹ This metric is a non-IFRS measure. Non-IFRS financial measures do not have standardized meanings prescribed by IFRS (see "Non-IFRS Financial Measures and Reconciliations").

YTD-2025 HIGHLIGHTS

• Revenue from property operations and NOI for YTD-2025 were $16,389 and $11,463 (YTD-2024 - $16,127 and $11,174), respectively, representing an increase of 1.6% and 2.6% relative to YTD-2024, primarily as a result of AMR growth described above.
• The Fund reported a net income and comprehensive income attributable to Unitholders for YTD-2025 of $579 (YTD-2024 - $9,070). The higher net income and comprehensive income in YTD-2024 was primarily attributable to fair value adjustment on investment properties and incremental interest on historical balances received from the Fund's corporate banking provider.
• AFFO for YTD-2025 was $2,987 (YTD-2024 - $1,846), representing an increase of $1,141 or 61.8% relative to YTD-2024 primarily due to an increase in NOI as well as lower finance costs and fund and trust expenses.

FINANCIAL CONDITION AND OPERATING RESULTS

Highlights of the financial and operating performance of the Fund as at September 30, 2025, for Q3-2025 and YTD-2025, including a comparison to December 31, 2024, Q3-2024 and YTD-2024, as applicable, are provided below:

				September 30, 2025	December 31, 2024
Key multi-family operational information
Number of multi-family properties owned				9	9
Total multi-family suites				944	944
Economic occupancy^(1)				90.0 %	91.3 %
Physical occupancy^(1)				97.1 %	94.9 %
AMR (in actual dollars)				$            2,046	$            2,000
AMR per square foot (in actual dollars)				$              2.60	$              2.56
Selected financial information
Gross book value^(2)				$        416,050	$        414,480
Indebtedness^(2)				$        267,995	$        269,546
Indebtedness to gross book value^(2)				64.4 %	65.0 %
Weighted average interest rate - as at period end^(3)				3.25 %	3.28 %
Weighted average loan term to maturity				4.34 years	5.09 years
		Q3-2025	Q3-2024	YTD-2025	YTD-2024
Summarized income statement
Revenue from property operations		$            5,477	$            5,502	$          16,389	$          16,127
Property operating costs		(1,158)	(1,313)	(3,559)	(3,692)
Property taxes		(455)	(420)	(1,367)	(1,261)
Adjusted Income from Operations / NOI		3,864	3,769	11,463	11,174
Fund and trust expenses		(512)	(555)	(1,588)	(1,744)
Finance costs^(4)		(2,598)	(2,667)	(7,748)	(8,450)
Other income and expense^(5)		(243)	163	(1,548)	8,090
Net income and comprehensive income - attributable to Unitholders		$               511	$               710	$               579	$            9,070
Other selected financial information
Funds from operations ("FFO")^(2)		$               754	$               547	$            2,127	$               980
FFO per Unit - basic and diluted		0.06	0.04	0.16	0.08
AFFO		1,044	847	2,987	1,846
AFFO per Unit - basic and diluted		0.08	0.07	0.23	0.14
Weighted average interest rate - average during period		3.26 %	3.40 %	3.27 %	3.43 %
Interest coverage ratio^(2)		1.54x	1.41x	1.52x	1.33x
Indebtedness coverage ratio^(2)		1.05x	1.00x	1.03x	0.96x
Distributions to Unitholders		$            1,130	$            1,134	$            3,394	$            3,220
Weighted average Units outstanding - basic and diluted (000s)		12,923	12,958	12,932	12,968
^(1) Economic occupancy for Q3-2025 and Q4-2024 and physical occupancy as at the end of each applicable reporting period. The Fund's economic occupancy for Q3-2025 was 90.0% including the impact of any concessions to residents and is presented as an average throughout the reporting period. Physical occupancy as at the end of the period was 97.1% as the Fund focused on increasing the physical occupancy at the Properties.
^(2) This metric is a non-IFRS measure. Non-IFRS financial measures do not have standardized meanings prescribed by IFRS (see "Non-IFRS Financial Measures and Reconciliations").
^(3) The weighted average interest rate on loans payable is presented as at September 30, 2025 and December 31, 2024, respectively.
^(4) Finance costs include interest expense on loans payable as well as non-cash amortization of deferred financing costs and other financing costs.
^(5) Includes distributions to Unitholders, fair value adjustment of investment properties, provision for carried interest and one time interest income.

NON-IFRS FINANCIAL MEASURES AND RECONCILIATIONS

The Fund's condensed consolidated interim financial statements are prepared in accordance with IFRS Accounting Standards ("IFRS"). Certain terms that may be used in this press release such as AFFO, AMR, adjusted net income and comprehensive income, cash provided by operating activities including interest costs, economic occupancy, physical occupancy, FFO, gross book value, indebtedness, indebtedness coverage ratio, indebtedness to gross book value, interest coverage ratio and NOI (collectively, the "Non-IFRS Measures") as well as other measures discussed elsewhere in this press release, are not measures defined under IFRS as prescribed by the International Accounting Standards Board, do not have standardized meanings prescribed by IFRS and are, therefore, unlikely to be comparable to similar measures as reported by other issuers. The Fund uses these measures to better assess its underlying performance and provides these additional measures so that investors may do the same. Information on the most directly comparable IFRS measures, composition of the Non-IFRS Measures, a description of how the Fund uses these measures, and an explanation of how these Non-IFRS Measures provide useful information to the investors are set out in the Fund's management's discussion and analysis ("MD&A") in the "Non-IFRS Financial Measures" section for Q3-2025 and are available on the Fund's profile on SEDAR+ at www.sedarplus.ca, which is incorporated by reference into this press release.

A reconciliation of the Fund's interest coverage ratio and indebtedness coverage ratio are provided below:

Interest and indebtedness coverage ratio		Q3-2025	Q3-2024	YTD-2025	YTD-2024
Net income and comprehensive income		$               511	$               710	$               579	$            9,070
Add / (deduct): non-cash or one-time items and distributions^(1)		581	227	2,550	(6,716)
Adjusted net income and comprehensive income^(2)		1,092	937	3,129	2,354
Interest coverage ratio^(3)		1.54x	1.41x	1.52x	1.33x
Indebtedness coverage ratio^(4)		1.05x	1.00x	1.03x	0.96x
^(1) Non-cash or one-time items consist of amortization of deferred financing costs, fair value adjustment on investment properties, interest income and provision for carried interest.
^(2) This metric is a non-IFRS measure. Non-IFRS financial measures do not have standardized meanings prescribed by IFRS (see "Non-IFRS Financial Measures and Reconciliations").
^(3) Interest coverage ratio is calculated as adjusted net income and comprehensive income plus interest expense, divided by interest expense.
^(4) Indebtedness coverage ratio is calculated as adjusted net income and comprehensive income plus interest expense, divided by interest expense and mandatory principal payments on the Fund's loans payable for a specific reporting period.

For Q3-2025, the interest coverage ratio and the indebtedness coverage ratio were 1.54x and 1.05x (Q3-2024 - 1.41x and 1.00x), respectively. The increase in both ratios during Q3-2025 relative to Q3-2024 was primarily due to higher NOI and reduction in interest costs.

CASH PROVIDED BY OPERATING ACTIVITIES RECONCILIATION TO FFO and AFFO

The Fund was formed as a "closed-end" fund with an initial term of three years, a targeted yield of 3.0% to 4.0% and a targeted minimum 12% pre-tax total investor internal rate of return across all Units.

Basic and diluted AFFO and AFFO per unit for Q3-2025 were $1,044 and $0.08 (Q3-2024 - $847 and $0.07), respectively, representing an increase in AFFO of $197 or 23.3% and an increase in AFFO per Unit of $0.01 relative to Q3-2024, primarily due to an increase in NOI as well as lower finance costs and fund and trust expenses.

A reconciliation of the Fund's cash provided by operating activities determined in accordance with IFRS to FFO and AFFO for Q3-2025, Q3-2024, YTD-2025 and YTD-2024 is provided below:

		Q3-2025	Q3-2024	YTD-2025	YTD-2024
Cash provided by operating activities		$             2,943	$             2,826	$             9,380	$             9,333
Less: interest and finance costs		(2,260)	(2,319)	(6,746)	(7,442)
Cash provided by operating activities - including interest costs ^(1)		683	507	2,634	1,891
Add / (deduct):
Change in non-cash operating working capital		383	361	467	46
Change in restricted cash		26	27	28	51
Amortization of financing costs		(338)	(348)	(1,002)	(1,008)
FFO		754	547	2,127	980
Add / (deduct):
Amortization of financing costs		338	348	1,002	1,008
Sustaining capital expenditures and suite renovation reserves		(48)	(48)	(142)	(142)
AFFO		$             1,044	$                847	$             2,987	$             1,846
^(1) This metric is a non-IFRS measure. Non-IFRS financial measures do not have standardized meanings prescribed by IFRS (see "Non-IFRS Financial Measures and Reconciliations").

The Fund's cash provided by operating activities, including interest and finance costs for Q3-2025 was $683 (Q3-2024 - $507), which was lower than distributions declared to Unitholders by $447 (Q3-2024 - $627).The Fund covers any shortfall between cash provided by operating activities including interest costs and distributions using cash generated from operating activities of the Fund in certain periods where applicable, or through cash on hand, including any proceeds from financing activities as applicable or availability on the Fund's credit facilities.

SUBSEQUENT EVENTS

On October 30, 2025, the Fund announced a proposed business combination with the Starlight Western Canada Multi-Family Limited Partnership, comprising of six multi-family properties to create a single investment platform comprising of fifteen multi-family properties totaling 1,413 suites, including the Fund's existing portfolio of nine multi-family properties across Primary Markets, with an estimated aggregate value of $639,400. The proposed transaction is expected to enhance diversification, operational efficiency, and access to capital, while positioning the combined entity to pursue a broader range of strategic alternatives and synergies, including a potential future capital raise and reduced cost of borrowing. In connection with the transaction, the Fund intends to extend its term by two years with two additional one-year extension options and permit a one-time re-opening within 18 months to raise up to 25% of the combined market capitalization. The combined entity is expected to target an annual yield of 2 to 3%.

FUTURE OUTLOOK

Since 2022, concerns over rising inflation contributed to a significant increase in interest rates with the Bank of Canada raising its target interest rate from 0.25% in early 2022 to 5.0% as of Q1-2024. Increases in target interest rates typically lead to increases in borrowing costs. Inflation in Canada has declined from its peak in June 2022 of 8.1% to 2.4% in September 2025 with improvements in global supply chains and the effects of higher interest rates moving through the economy. As a result, the Bank of Canada has reduced its target interest rate by a total of 275 basis points since June 2024, bringing it down to 2.25% as of November 18, 2025.

The Fund benefits from the availability of Canada Mortgage and Housing Corporation insured financing to the Canadian residential sector, which provided a stable, competitively priced source of financing. Operating fundamentals continue to be favorable as evidenced by the operating results achieved by the Fund and the Fund has made steady progress in mitigating the significant increases in interest rates by increasing the amount of fixed rate debt to 93.7% of its total debt as at September 30, 2025.

According to Statistics Canada, the September 2025 unemployment rate in Canada was 7.1%, as compared to an unemployment rate of 6.4% in BC, including Vancouver Island and the Coast Region. BC gained approximately 48,600 jobs between September 2024 and September 2025, demonstrating the economic strength of the Primary Markets.

Each year, the Federal Department of Immigration, Refugees and Citizenship Canada ("IRCC") releases a new Immigration Levels Plan to guide its operations. In 2024, IRCC welcomed a record of 464,000 immigrants to Canada with a target of 395,000 immigrants for 2025. However, subsequent to October 2025, these targets were further adjusted down from 395,000 to 380,000 for 2026, 2027 and 2028. In early 2025, the United States announced certain tariffs on steel, aluminum and other imported components, with further tariffs enacted and continuing to be in effect between Canada and the U.S. and the U.S. and various other jurisdictions. These tariffs may result in increased construction or renovation costs for multi-family projects in Canada and the Primary Markets.

While recent interest rate cuts have improved borrower sentiment and affordability, further reductions by the Bank of Canada are uncertain due to relatively strong employment market and the potential impacts of any new U.S. tariffs. The Fund does not expect any significant impact to the Fund's operating results from changes in immigration, tariffs or interest rates, as the core fundamentals of the economy remain robust. The Fund continues to closely monitor these ongoing developments.

The above factors as well as the lack of housing supply and affordability, have made it more challenging for existing residents of multi-family properties to buy homes. In addition, the construction slowdown of new homes due to elevated interest rates has also continued to result in increased demand for multi-family suites and an expected reduction in new supply.

Subsequent to September 30, 2025, the Fund announced a proposed business combination with the Starlight Western Canada Multi-Family Limited Partnership, comprising of six multi-family properties to create a single investment platform comprising of fifteen multi-family properties totaling 1,413 suites, including the Fund's existing portfolio of nine multi-family properties across Primary Markets, with an estimated aggregate value of $639,400. The proposed transaction is expected to enhance diversification, operational efficiency, and access to capital, while positioning the combined entity to pursue a broader range of strategic alternatives and synergies, including a potential future capital raise and reduced cost of borrowing. In connection with the transaction, the Fund intends to extend its term by two years with two additional one-year extension options and permit a one-time re-opening within 18 months to raise up to 25% of the combined market capitalization. The combined entity is expected to target an annual yield of 2 to 3% (see "Subsequent Events").

The Fund believes that the transaction will strengthen its long-term positioning by enhancing financing flexibility, and creating new avenues for liquidity while maintaining exposure to high-quality multi-family assets in strong growth markets. Combined with moderating interest rates, continued population inflows, and persistent supply constraints across Western Canada, the Fund expects these dynamics to support stable occupancy, continued rent growth, and attractive long-term risk-adjusted returns for the Unitholders.

Further disclosure surrounding the Future Outlook is included in the Fund's MD&A in the "Future Outlook" section for Q3-2025 under the Fund's profile, which is available on www.sedarplus.ca.

FORWARD-LOOKING STATEMENTS 

Certain statements contained in this press release constitute forward-looking information within the meaning of Canadian securities laws and which reflect the Fund's current expectations regarding future events, including the overall financial performance of the Fund and the Properties, the impact of elevated levels of inflation and interest rates and uncertainty surrounding U.S. tariffs. Forward-looking information is provided for the purposes of assisting the reader in understanding the Fund's financial performance, financial position and cash flows as at and for the periods ended on certain dates and to present information about management's current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes.

Forward-looking information may relate to future results, the impact of inflation levels and interest rates, acquisitions, financing, performance, achievements, events, prospects or opportunities for the Fund or the real estate industry and may include statements regarding the financial position, business strategy, budgets, litigation, projected costs, capital expenditures, financial results, occupancy levels, AMR, taxes, and plans and objectives of or involving the Fund. Particularly, matters described in "Future Outlook" are forward-looking information. In some cases, forward-looking information can be identified by terms such as "may", "might", "will", "could", "should", "would", "occur", "expect", "plan", "anticipate", "believe", "intend", "seek", "aim", "estimate", "target", "goal", "project", "predict", "forecast", "potential", "continue", "likely", "schedule", or the negative thereof or other similar expressions concerning matters that are not historical facts.

Forward-looking statements involve known and unknown risks and uncertainties, which may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct, and that objectives, strategic goals and priorities may not be achieved. Those risks and uncertainties include: the extent and sustainability of potential higher levels of inflation and the potential impact on the Fund's operating costs; the impact of any tariffs and retaliatory tariffs on the economy; changes in government legislation or tax laws which would impact any potential income taxes or other taxes rendered or payable with respect to the Properties or the Fund's legal entities; the impact of elevated interest rates and inflation; the extent to which favorable operating conditions achieved during historical periods may continue in future periods; the applicability of any government regulation concerning the Fund's residents or rents; the realization of property value appreciation and the timing thereof; the extent and pace at which any changes in interest rates that impact the Fund's weighted average interest rate may occur; and the availability of debt financing. A variety of factors, many of which are beyond the Fund's control, affect the operations, performance and results of the Fund and its business, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results.

There are numerous risks and uncertainties which include, but are not limited to, risks related to the Units, risks related to the Fund and its business including inflation and changes in interest rates. The reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking statements as there can be no assurance actual results will be consistent with such forward-looking statements. Although the Fund believes the expectations reflected in such forward-looking information are reasonable and represent the Fund's projections, expectations and beliefs at this time, such information involves known and unknown risks and uncertainties which may cause the Fund's actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking information. Important factors that could cause actual results to differ materially from the Fund's expectations include, among other things, the impact of inflation, the availability of mortgage financing and the interest rates for such financing, and general economic and market factors, including interest rates, business competition and changes in government regulations or in tax laws. The reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking information, as there can be no assurance that actual results will be consistent with such forward-looking information.

Information contained in forward-looking information is based upon certain material assumptions that were applied in drawing a conclusion or making a forecast or projection, 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 applicability of any government regulation concerning the Fund's residents or rents; the realization of property value appreciation and the timing thereof; the inventory of residential real estate properties; the ability of the Fund to benefit from any asset management initiatives at certain Properties; the price at which the Properties may be disposed and the timing thereof; closing and other transaction costs in connection with the disposition of the Properties; availability of mortgage financing and current rates and market expectations for future interest rates; the uncertainty related to the closing of proposed business combination and the timing thereof; the capital structure of the Fund; the extent of competition for residential properties; the growth in NOI generated from asset management initiatives; the population of residential real estate market participants; assumptions about the markets in which the Fund operates; expenditures and fees in connection with the maintenance, operation and administration of the Properties; the ability of Starlight Investments CDN AM Group LP (the "Manager") to manage and operate the Properties; the global and Canadian economic environment; the impact, if any, of inflation on the Fund's operating costs; and governmental regulations or tax laws. There can be no assurance regarding: (a) inflation or changes in interest rates on the Fund's business, operations or performance; (b) the Fund's ability to mitigate such impacts; (c) credit, market, operational, and liquidity risks generally; (d) that the Manager or any of its affiliates, will continue its involvement as asset manager of the Fund in accordance with its current asset management agreement; and (e) other risks inherent to the Fund's business and/or factors beyond its control which could have a material adverse effect on the Fund.

The forward-looking information included in this press release relates only to events or information as of the date on which the statements are made in this press release. Except as specifically required by applicable Canadian securities law, the Fund undertakes no obligation to update or revise publicly any forward-looking information, whether because of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

ABOUT STARLIGHT WESTERN CANADA MULTI-FAMILY (NO. 2) FUND

The Fund is a trust formed under the laws of Ontario for the primary purpose of indirectly acquiring, owning and operating a portfolio of income producing multi-family rental properties located in BC. The Fund has interests in and operates a portfolio comprising interests in 944 income producing multi-family suites located in the Primary Markets.

For the Fund's complete condensed consolidated interim financial statements and MD&A for the three and nine months ended September 30, 2025 and any other information related to the Fund, please visit www.sedarplus.ca. 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 November 2025 Newsletter which is available on the Fund's profile at www.starlightinvest.com.

Please visit us at www.starlightinvest.com and connect with us on LinkedIn at www.linkedin.com/company/starlight-investments-ltd-.

SOURCE Starlight Western Canada Multi-Family (No. 2) Fund

Daniel Drimmer, Founder and Chief Executive Officer, Starlight Western Canada Multi-Family (No. 2) Fund, [phone], [email protected]; Martin Liddell, Chief Financial Officer, Starlight Western Canada Multi-Family (No. 2) Fund, [phone], [email protected]