SUMMARY HIGHLIGHTS FOR THE THREE AND TWELVE-MONTH PERIODS
ENDED DECEMBER 31, 2021
- STRONG FINANCIAL PERFORMANCE
FOR THE THREE-MONTH
PERIOD ENDED DECEMBER 31,
2021
-
- Profit (loss) of $131.1
million
- Funds From Operations (FFO) of $0.75 per Unit1; an increase of
11.9%
FOR
THE TWELVE-MONTH PERIOD ENDED DECEMBER 31,
2021
-
- Profit (loss) of $446.3
million
- FFO of $2.94 per Unit; an
increase of 7.3%
- SOLID OPERATIONAL RESULTS
-
- Q4 2021 same property Net Operating Income ("NOI")2
of $68.1 million; an increase of
3.4%
- Q4 2021 same property occupancy2 of 95.85% through
COVID fifth wave and seasonally slower period
- STRONG AND FLEXIBLE FINANCIAL POSITION
-
- Approximately $306 million of
total available liquidity
- 98% of Boardwalk's mortgages carry CMHC-insurance
- Unitholders' Equity of $3.3
billion
- Net Asset Value of $66.87 per
Unit1
- ACCRETIVE CAPITAL RECYCLING
-
- Completed the sale of previously announced 179-unit non-core
asset in Saskatoon, SK for
$25.0 million
- Completed divestiture of 50% interest in Sandalwood development
in Mississauga, ON
- Invested $24.0 million in the
repurchase and cancellation of 438,400 Trust Units during fourth
quarter under normal course issuer bid at volume weighted average
price of $54.85
- INTRODUCTION OF 2022 FINANCIAL GUIDANCE
-
- FFO range of $3.03 to
$3.18 per Unit3
- Same property NOI Growth of 3.0% to 7.0%
- DISTRIBUTION INCREASED 8.0% TO $1.08 PER TRUST UNIT ON AN ANNUALIZED
BASIS
- RECOGNIZING OUR STRENGTHENING LEADERSHIP TEAM
-
- Appointment of James Ha as
President of Boardwalk REIT
- Appointment of Leonora Davids as
Senior Vice President of Operations
CALGARY, AB, Feb. 24, 2022 /PRNewswire/ - Boardwalk Real
Estate Investment Trust (TSX: BEI.UN)
Boardwalk Real Estate Investment Trust ("Boardwalk", the "REIT"
or the "Trust") today announced its financial results for the
fourth quarter and fiscal 2021.
Sam Kolias; Chairman and Chief
Executive Officer of Boardwalk REIT commented: "We are pleased to
report on another solid quarter and performance to close out 2021,
with solid growth in both FFO and Profit. Our continued
strong financial performance is a result of our team's committed
focus on finding innovative and efficient ways to attract and
retain Resident Members and deliver our exceptional product
quality, service, and experience in the place where our Resident
Members call home. Boardwalk's diversified product offering
has resulted in resilient and growing performance through various
economic conditions.
________________
|
1
A non-GAAP ratio. For definitions,
reconciliations, and the basis of presentation of Boardwalk REIT's
non-GAAP measures, refer to non-GAAP Ratios in this Earnings
Release.
|
2
Same property figures exclude
un-stabilized properties (properties which have been owned for less
than 24 months) and sold assets.
|
3
A non-GAAP ratio. Please refer to
non-GAAP Ratios in this Earnings Release for more
information on FFO per Unit Future Financial Guidance.
|
Entering 2022, rental activity was seasonally slow with colder
weather, and government restrictions relating to Omicron.
Fortunately, Boardwalk's focus on retention resulted in a
significant reduction in move-outs, which allowed Boardwalk to
maintain strong occupancy through the seasonally slower months of
December and January. Our portfolio occupancy of nearly 96%
heading into the spring rental season is a positive indicator and
we have seen strengthening incentive reductions on lease renewals
across our portfolio. New leasing spreads are also positive
in all of our markets with the exception of Northern Alberta, which is a market that has
the opportunity to gain on occupancy as well as incentive
reductions.
With improving housing fundamentals in our core unregulated and
affordable markets, Boardwalk is well positioned to continue to
deliver strong organic growth and financial performance as
reflected by our guidance for this new year."
FOURTH QUARTER & TWELVE-MONTH FINANCIAL
HIGHLIGHTS
$ millions, except
per unit amounts
|
Highlights of the
Trust's Fourth Quarter 2021 Financial Results
|
|
3 Months
Dec 31, 2021
|
3 Months
Dec 31, 2020
|
%
Change
|
12 Months
Dec 31,
2021
|
12 Months
Dec 31,
2020
|
%
Change
|
Operational
Highlights
|
|
|
|
|
|
|
|
Rental
Revenue
|
$
|
118.7
|
$
|
116.5
|
1.9%
|
$
|
470.5
|
$
|
465.6
|
1.1%
|
Same Property Rental
Revenue
|
$
|
115.2
|
$
|
114.0
|
1.1%
|
$
|
456.8
|
$
|
457.6
|
-0.2%
|
Net Operating Income
(NOI)
|
$
|
69.0
|
$
|
65.8
|
5.0%
|
$
|
274.3
|
$
|
269.1
|
1.9%
|
Same Property
NOI
|
$
|
68.1
|
$
|
65.9
|
3.4%
|
$
|
271.7
|
$
|
271.3
|
0.1%
|
Operating
Margin1
|
|
58.1%
|
|
56.4%
|
|
|
58.3%
|
|
57.8%
|
|
Same Property
Operating Margin
|
|
59.1%
|
|
57.8%
|
|
|
59.5%
|
|
59.3%
|
|
|
|
|
|
|
|
|
|
|
Financial
Highlights
|
|
|
|
|
|
|
|
|
Funds From Operations
(FFO)2
|
$
|
38.3
|
$
|
34.3
|
11.8%
|
$
|
150.2
|
$
|
139.7
|
7.5%
|
Adjusted Funds From
Operations (AFFO)3
|
$
|
31.2
|
$
|
25.5
|
22.5%
|
$
|
117.9
|
$
|
104.9
|
12.4%
|
Profit (loss)
3
|
$
|
131.1
|
$
|
(188.4)
|
169.6%
|
$
|
446.3
|
$
|
(197.3)
|
326.2%
|
FFO per Unit
(includes $0.02 of retirement costs in YTD 2021)
|
$
|
0.75
|
$
|
0.67
|
11.9%
|
$
|
2.94
|
$
|
2.74
|
7.3%
|
AFFO per Unit
(includes $0.02 of retirement costs in YTD 2021)
|
$
|
0.61
|
$
|
0.50
|
22.0%
|
$
|
2.31
|
$
|
2.06
|
12.1%
|
Profit (loss) per
Trust Unit
|
$
|
2.82
|
$
|
(4.05)
|
169.7%
|
$
|
9.59
|
$
|
(4.24)
|
326.2%
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
Unitholder's
Equity
|
|
|
|
|
|
$
|
3,253,178
|
$
|
2,876,449
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Asset
Value
|
|
|
|
|
|
|
|
|
|
|
Net asset
value3
|
|
|
|
|
|
$
|
3,412,130
|
$
|
2,933,974
|
|
Net asset value per
diluted unit4
|
|
|
|
|
|
$
|
66.87
|
$
|
57.49
|
|
________________
|
1
Operating margin is calculated by dividing NOI by Rental Revenue
allowing management to assess the percentage of rental revenue
which generated profit.
|
2 A
non-GAAP financial measure. For definitions, reconciliations,
and the basis of presentation of Boardwalk REIT's non-GAAP
measures, refer to Non-GAAP Financial Measures in this
Earnings Release.
|
3 Profit
(loss) as defined by IFRS includes the changes in assets and/or
liabilities carried at fair value three and twelve months ended
December 31, 2021.
|
4 A
non-GAAP ratio. For definitions, reconciliations, and the
basis of presentation of Boardwalk REIT's non-GAAP measures, refer
to Non-GAAP Ratios in this Earnings Release.
|
The Trust's IFRS fair value of its investment properties, for
the year ended December 31, 2021,
increased from the prior year primarily as a result of adjustments
to capitalization rates ("cap rates") in several of the Trust's
markets reflecting extremely strong demand for multi-family
product. The Trust also increased market rents in a number of its
communities and lowered vacancy assumptions in select markets
reflecting improving rental fundamentals.
Continued
Highlights of the Trust's Fourth Quarter 2021 Financial
Results
|
|
3 Months
Dec 31, 2021
|
3 Months
Dec 31, 2020
|
%
Change
|
12 Months Dec
31, 2021
|
12 Months
Dec 31,
2020
|
%
Change
|
Liquidity, Debt
and Distributions
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
$
|
64,300
|
|
|
Subsequent
committed/funded financing
|
|
|
|
$
|
42,200
|
|
|
Unused committed
revolving credit facility
|
|
|
|
$
|
199,800
|
|
|
Total Available
Liquidity
|
|
|
|
$
|
306,300
|
|
|
|
|
|
|
|
|
|
Total mortgage
principal outstanding
|
$
|
3,088,978
|
$
|
3,004,086
|
|
$
|
3,088,978
|
$
|
3,004,086
|
|
Interest Coverage
Ratio (Rolling 4 quarters)
|
|
2.97
|
|
2.79
|
|
|
2.97
|
|
2.79
|
|
|
|
|
|
|
|
|
Regular Distributions
Declared (Trust Units & LP Class B Units)
|
$
|
12.7
|
$
|
12.8
|
-0.3%
|
$
|
51.0
|
$
|
51.0
|
0.0%
|
Regular Distributions
Declared Per Unit (Trust Units & LP Class B Units)
|
$
|
0.250
|
$
|
0.250
|
0.0%
|
$
|
1.001
|
$
|
1.001
|
0.0%
|
FFO Payout
Ratio1
|
|
33.2%
|
|
37.3%
|
|
|
34.0%
|
|
36.5%
|
|
|
|
|
|
|
|
|
Stabilized Apartment
Suites
|
|
|
|
|
32,706
|
|
32,909
|
|
Un-Stabilized
Suites
|
|
|
|
|
558
|
|
487
|
|
Total Apartment
Suites
|
|
|
|
|
33,264
|
|
33,396
|
|
SOLID OPERATIONAL RESULTS,
Portfolio
Highlights for the Fourth Quarter of 2021
|
|
Dec-21
|
Dec-20
|
Average Occupancy
(Quarter Average)2
|
|
95.85%
|
|
95.71%
|
|
|
|
|
Average Monthly Rent
(Period Ended)
|
$
|
1,153
|
$
|
1,132
|
Average Market Rent
(Period Ended)3
|
$
|
1,350
|
$
|
1,330
|
Average Occupied Rent
(Period Ended)4
|
$
|
1,203
|
$
|
1,189
|
|
|
|
Loss-to-Lease (Period
Ended) ($ millions)
|
$
|
55.6
|
$
|
53.5
|
Loss-to-Lease Per
Trust Unit (Period Ended)
|
$
|
1.09
|
$
|
1.05
|
|
|
|
|
|
|
|
|
|
|
________________
|
1 A
non-GAAP ratio. For definitions, reconciliations, and the
basis of presentation of Boardwalk REIT's non-GAAP measures, refer
to Non-GAAP Ratios in this Earnings Release.
|
2 Average
occupancy is adjusted to be on a same property basis.
|
3 Market rent is a component of
rental revenue as calculated in accordance with IFRS and is
calculated as of the first day of each month as the average rental
revenue amount a willing landlord might reasonably expect to
receive, and a willing tenant might reasonably expect to pay, for a
tenancy, before adjustments for other rental revenue items such as
incentives, vacancy loss, fees, specific recoveries, and revenue
from commercial tenants.
|
4 Occupied
rent is a component of rental revenue as calculated in
accordance with IFRS and is calculated for occupied units as of the
first day of each month as the average rental revenue, adjusted for
other rental revenue items such as fees, specific recoveries and
revenue from commercial tenants.
|
|
Jan-21
|
Feb-21
|
Mar-21
|
Apr-21
|
May-21
|
Jun-21
|
Jul-21
|
Aug-21
|
Sep-21
|
Oct-21
|
Nov-21
|
Dec-21
|
Jan-22
|
Feb-22
|
Same Property
Portfolio
Occupancy12
|
94.8%
|
94.7%
|
95.0%
|
95.7%
|
96.0%
|
96.0%
|
95.9%
|
96.1%
|
96.2%
|
96.1%
|
95.7%
|
95.7%
|
95.6%
|
95.5%
|
The Trust maintained high occupancy compared to the same period
a year ago by focusing on gaining market share and retention.
Market rents were increased in communities within some of the
Trust's markets where rental market fundamentals continue to
tighten while average occupied rent increased sequentially and when
compared to the same period a year ago as the Trust focuses on
reducing incentives on lease renewals.
For the year, a same property revenue decrease of 0.2% combined
with operating expense decrease of 0.6%, resulted in same property
NOI growth of 0.1%. Most of Boardwalk's markets contributed
positively to this NOI growth through revenue optimization and
controllable operating expense innovation.
For the fourth quarter, lower property taxes compared to the
prior year supported Boardwalk's Edmonton and Calgary portfolios' increase in same property
NOI of 1.8% and 6.6%, respectively. In Calgary, same property revenue growth was a
positive contributor to NOI while in Edmonton positive leasing spreads on renewals
set the foundation for positive leasing spreads on new leases as
the market absorbs vacancy. Saskatchewan's market continues to improve
with the Trust's portfolio realizing 14.6% same property NOI growth
in the fourth quarter of 2021 versus the same period last year, as
a result of strong same property revenue growth and significant
reductions in both controllable and non-controllable expenses. The
Trust's Ontario market continues
to deliver stable results with high occupancy and mark-to-market
opportunity on turnover contributing to same property NOI growth of
3.4%, in the fourth quarter of 2021 compared to the fourth quarter
of 2020. In Quebec, increases in
non-controllable expenses such as property taxes, utilities and
insurance more than offset positive same property revenue growth
resulting in same property NOI decrease of 2.8% in the fourth
quarter of 2021 compared to the fourth quarter of 2020.
Overall, in the fourth quarter, same property revenue growth of
1.1%, paired with a reduction in operating expenses of 2.1%
resulted in portfolio same property NOI growth of 3.4%, compared to
the same period in 2020.
Dec 31 2021 - 3
M
|
# of Units
|
|
% Rental Revenue
Growth
|
|
% Total Rental
Expenses
Growth
|
|
% Net
Operating
Income Growth
|
|
% of NOI
|
Edmonton
|
12,882
|
|
(0.5)%
|
|
(3.0)%
|
|
1.8%
|
|
34.8%
|
Calgary
|
5,798
|
|
1.5%
|
|
(6.7)%
|
|
6.6%
|
|
22.0%
|
Red Deer
|
939
|
|
1.0%
|
|
(6.5)%
|
|
7.9%
|
|
2.4%
|
Grande
Prairie
|
645
|
|
(2.5)%
|
|
(2.5)%
|
|
(2.6)%
|
|
1.4%
|
Fort
McMurray
|
352
|
|
0.9%
|
|
7.3%
|
|
(3.5)%
|
|
1.0%
|
Alberta
|
20,616
|
|
0.2%
|
|
(4.1)%
|
|
3.5%
|
|
61.6%
|
Quebec
|
6,000
|
|
0.8%
|
|
7.6%
|
|
(2.8)%
|
|
19.0%
|
Saskatchewan
|
3,505
|
|
4.3%
|
|
(8.9)%
|
|
14.6%
|
|
11.6%
|
Ontario
|
2,585
|
|
4.5%
|
|
6.4%
|
|
3.4%
|
|
7.8%
|
|
32,706
|
|
1.1%
|
|
(2.1)%
|
|
3.4%
|
|
100.0%
|
Dec 31 2021 - 12
M
|
# of Units
|
|
% Rental Revenue
Growth
|
|
% Total Rental
Expenses Growth
|
|
% Net
Operating
Income Growth
|
|
% of NOI
|
Edmonton
|
12,882
|
|
(2.7)%
|
|
(1.0)%
|
|
(4.0)%
|
|
35.3%
|
Calgary
|
5,798
|
|
(0.1)%
|
|
(1.7)%
|
|
0.7%
|
|
21.5%
|
Red Deer
|
939
|
|
(1.3)%
|
|
(3.5)%
|
|
0.7%
|
|
2.3%
|
Grande
Prairie
|
645
|
|
(3.4)%
|
|
(4.2)%
|
|
(2.7)%
|
|
1.5%
|
Fort
McMurray
|
352
|
|
(1.0)%
|
|
3.6%
|
|
(4.4)%
|
|
1.0%
|
Alberta
|
20,616
|
|
(1.8)%
|
|
(1.3)%
|
|
(2.2)%
|
|
61.6%
|
Quebec
|
6,000
|
|
1.4%
|
|
2.1%
|
|
1.0%
|
|
19.8%
|
Saskatchewan
|
3,505
|
|
3.9%
|
|
(2.9)%
|
|
9.0%
|
|
11.0%
|
Ontario
|
2,585
|
|
5.4%
|
|
4.5%
|
|
6.1%
|
|
7.6%
|
|
32,706
|
|
(0.2)%
|
|
(0.6)%
|
|
0.1%
|
|
100.0%
|
________________
|
1 Same
property figures exclude un-stabilized properties and sold
assets.
|
2 Occupancy as of the 1st
day of the month.
|
STRONG LIQUIDITY POSITION WITH ACCESS TO LOW INTEREST
RATES
The Trust utilized the low interest rate environment in 2021 to
renew and refinance its mortgage maturities at interest rates well
below the maturing rates. In 2021, Boardwalk renewed its
maturing mortgages at a weighted average interest rate of 1.75%, 77
basis points below the maturing rate average of
2.52%1.
In 2022, the Trust anticipates $445.2
million of mortgages payable maturing with an average
in-place interest rate of 2.67%. Current market 5 and 10-year
CMHC financing rates are estimated to be 2.50% and 2.80%,
respectively, providing a positive interest cost savings
opportunity with medium duration mortgages. To date, the
Trust has forward-locked or renewed the interest rate on
$41.6 million or 9% of its maturing
mortgages in 2022 at an average interest rate of 2.44%.
ACCRETIVE CAPITAL RECYCLING
The Trust remains committed to re-investing retained cashflow
and the net proceeds from the sale of non-core assets toward
opportunities that are both accretive to FFO per Unit in the
near-term and significantly enhance the NAV per Unit of the Trust
over the intermediate term.
During the year, the Trust completed the sale of three non-core
assets, two in Edmonton and one in
Saskatoon. The Trust also
completed the sale of its 50% interest in the Sandalwood
development in Mississauga during
the fourth quarter.
As previously announced, on December 15,
2021, the Trust completed the sale of a 179-unit, non-core
asset in Saskatoon. Reid Park
Estates is a three-storey walk-up building. The sale price of
$25.0 million, equating to a cap rate
of approximately 5.0% on as-is net operating income or $139,700 per door, was slightly above the Trust's
fair value of the asset prior to the sale. Net proceeds from the
sale were approximately $12.1
million. The disposition of the two non-core assets in
Edmonton were in line with or
above the Trust's fair value and generating net proceeds of
approximately $14.9 million. Earlier
in the year, the Trust acquired two assets during the second
quarter that align with its long-term objectives of accretive
geographic expansion in well-located, undersupplied markets.
Aurora, in Victoria, BC,
and Mountainview Estates, in Banff, AB, total 195 units and were purchased
for a combined price of $72.3 million
in two separate transactions.
During the fourth quarter, the Trust announced that it received
approval from the Toronto Stock Exchange (the "TSX") to commence a
normal course issuer bid ("NCIB"). The Trust continues to view its
own portfolio as offering un-paralleled value in the multi-family
sector and believes its current unit price represents an attractive
opportunity for re-investment. During the fourth quarter, the Trust
re-purchased 438,400 Trust Units at a volume-weighted average price
of $54.85 for a total price of
approximately $24.0 million.
________________
|
1 Excludes Reid Park Estates, which
was divested in December.
|
2022 FINANCIAL GUIDANCE
As is customary with the Trust's fourth quarter disclosure,
Boardwalk is introducing its 2022 outlook and financial
guidance.
The Trust's current outlook is for a continuation of the
positive growth trend across its portfolio. This growth is
anticipated to be tempered partially by anticipated increases in
certain non-controllable operating expenses such as property taxes,
insurance costs, and utilities.
Overall, the Trust is providing its 2022 financial guidance as
follows:
|
|
|
|
|
|
2022
Guidance
|
2021 Actual (in $
millions except per
unit)
|
Same-Property NOI
Growth
|
|
+3.0% to
+7.0%
|
0.1%
|
Profit
(loss)
|
|
N/A
|
446,267
|
FFO
(1)
|
|
N/A
|
150,207
|
AFFO
(1)(3)
|
|
N/A
|
117,290
|
FFO Per
Unit(2)
|
|
$3.03 to
$3.18
|
$2.94
|
AFFO Per
Unit(2)(3)
|
|
$2.39 to
$2.54
|
$2.31
|
|
|
(1)
|
A non-GAAP financial
measure. For definitions, reconciliations, and the basis of
presentation of Boardwalk REIT's non-GAAP measures, refer to
Non-GAAP Financial Measures in this Earnings Release.
|
(2)
|
A non-GAAP
ratio. For definitions, reconciliations, and the basis of
presentation of Boardwalk REIT's non-GAAP measures, refer to
Non-GAAP Ratios in this Earnings Release.
|
(3)
|
Utilizing a
Maintenance CAPEX expenditure of $965/suite/year
|
The reader is cautioned that this information is forward-looking
and actual results may vary from those forecasted. The Trust
reviews the assumptions used to derive its forecast quarterly, and
based on this review, may adjust its outlook accordingly.
FOURTH QUARTER REGULAR MONTHLY DISTRIBUTION
ANNOUNCEMENT
In addition to the Trust's previously confirmed regular monthly
distribution for the month of February
2022 of $0.0834 per Trust
Unit, Boardwalk is confirming and increasing its monthly cash
distribution for the months of March
2022, and April 2022 by 8.0%
equating to $0.09 per Trust Unit or
$1.08 per Trust Unit on an annualized
basis. A summary of Boardwalk's distributions for the months
of February, March and April 2022 can
be found below:
Month
|
Per
Unit
|
Annualized
|
Record
Date
|
Distribution
Date
|
February
2022
|
$
|
0.0834
|
$
|
1.00
|
28-Feb-22
|
15-Mar-22
|
March
2022
|
$
|
0.0900
|
$
|
1.08
|
31-Mar-22
|
15-Apr-22
|
April
2022
|
$
|
0.0900
|
$
|
1.08
|
29-Apr-22
|
16-May-22
|
In line with Boardwalk's distribution policy of maximum
re-investment, the Trust's payout ratio remains conservative at
33.2% of Q4 2021 FFO; and 34.0% of the last 12 months
FFO.
Boardwalk's regular monthly distribution provides a stable and
attractive yield for the Trust's unitholders.
RECOGNIZING OUR STRENGTHENING LEADERSHIP TEAM
Boardwalk and its Board of Trustees is proud to announce the
appointment of Mr. James Ha as our
new President of Boardwalk REIT.
In addition, the Trust is proud to announce the appointment of
Ms. Leonora Davids to Senior Vice
President of Operations.
Since joining Boardwalk in 2007, Mr. James Ha has assumed a myriad of leadership
roles and responsibilities ranging from: finance, treasury, capital
markets, investor relations, acquisitions, investments, strategic
partnerships, revenue optimization and corporate strategy, all of
which have played a significant role in Boardwalk's overall success
and growth.
Sam Kolias, Chairman and CEO of
Boardwalk commented, "We have had the great pleasure of working
closely with James over the past several years and am excited to
partner with him in leading our extraordinary performance focused
team. James has strong relationships with our investor
community, capital partners, and team of associates, combined with
his unique ability to innovate, drive growth, and performance makes
him the ideal candidate. This appointment positions us for
success in achieving our strategic growth objectives"
Concurrently, Ms. Leonora Davids
appointment to Senior Vice President, Operations is a reflection of
her operational excellence and expertise. With over 23 years of
property management experience, Ms. Davids strong and unmatched
leadership, has contributed to the overall success and performance
of her teams. Ms. Davids began her career as a Resident
Manager in one of Boardwalk's communities in Calgary in 1999, and since, has progressively
grown her responsibilities with her most recent role as Vice
President of Operations for the Trust.
Sam Kolias, Chairman and CEO of
Boardwalk commented "Leonora's advice, guidance, and expertise in
operations has been paramount to Boardwalk's success in both strong
and challenging economic periods. As Senior Vice President,
Leonora will provide leadership in further expanding the depth of
our operational team, building additional strong leaders who are
committed to our approach of providing our Resident Members with
the best product quality, service and experience."
Mr. Kolias added, "These recent appointments reflect Boardwalk's
ongoing commitment to recognizing, diversifying, and strengthening
our leadership team who inspire a compassionate performance-based
culture that builds a future of belonging for all of our Associates
and Resident Members. We believe that our core strength is and will
always remain our people and will continue to strategically align
our team to support future growth goals."
THIRD ANNUAL ESG REPORT
The Trust is, and continues to be, committed to environmental,
social and governance ("ESG") objectives and initiatives, including
working towards reducing greenhouse gas emissions and electricity
and natural gas consumption, water conservation, waste
minimization, and a continued focus on governance and
oversight. Boardwalk anticipates publishing its third annual
ESG report in March. The ESG report, along with the Trust's
Annual report, will be available digitally on Boardwalk's website
and under the Trust's profile at www.sedar.com. The Trust is
excited to share an update and progress in reporting on its ESG
initiatives and improvements.
FINANCIAL AND SUPPLEMENTARY INFORMATION
Boardwalk produces quarterly financial statements, management's
discussion and analysis, and a supplemental information package
that provides detailed information regarding the Trust's activities
during the quarter. Financial and supplementary information
is available on Boardwalk's investor website at
www.bwalk.com/investors.
TELECONFERENCE ON FOURTH QUARTER 2021 FINANCIAL
RESULTS
Boardwalk invites you to participate in the teleconference that
will be held to discuss these results tomorrow morning
(February 25, 2022) at 11:00 am Eastern Time. Senior management will
speak to the period's results and provide an update. Presentation
materials will be made available on Boardwalk's investor website at
www.bwalk.com/investors prior to the call.
Teleconference: The telephone numbers for the
conference are 416-764-8650 (local/international callers) or
toll-free 1-888-664-6383 (within North
America).
Note: Please provide the operator with the below Conference Call
ID or Topic when dialing in to the call.
Conference ID: 59564101
Topic: Boardwalk Real Estate Investment Trust, 2021 Fourth Quarter
Results
Webcast: Investors will be able to listen to the
call and view Boardwalk's slide presentation by visiting
www.bwalk.com/investors prior to the start of the
call.
An information page will be provided for any software needed and
system requirements. The webcast and slide presentation will
also be available at:
Boardwalk REIT Fourth Quarter Results Webcast Link
Replay: An audio recording of the teleconference will be
available on the Trust's website:
www.bwalk.com/investors
CORPORATE PROFILE
Boardwalk REIT strives to be Canada's friendliest community provider and is
a leading owner/operator of multi-family rental communities.
Providing homes in more than 200 communities, with over 33,000
residential units totaling over 28 million net rentable square
feet, Boardwalk has a proven long-term track record of building
better communities, where love always livestm. Our
three-tiered and distinct brands: Boardwalk Living, Boardwalk
Communities, and Boardwalk Lifestyle, cater to a large diverse
demographic and has evolved to capture the life cycle of all
Resident Members. Boardwalk's disciplined approach to capital
allocation, acquisition, development, purposeful re-positioning,
and management of apartment communities allows the Trust to provide
its brand of community across Canada creating exceptional Resident Member
experiences. Differentiated by its peak performance culture,
Boardwalk is committed to delivering exceptional service, product
quality and experience to our Resident Members who reward us with
high retention and market leading operating results, which in turn,
lead to higher free cash flow and investment returns, stable
monthly distributions, and value creation for all our
stakeholders.
Boardwalk REIT's Trust units are listed on the Toronto Stock
Exchange, trading under the symbol BEI.UN. Additional
information about Boardwalk REIT can be found on the Trust's
website at www.bwalk.com/investors.
NON-GAAP FINANCIAL MEASURES
Boardwalk believes non-GAAP financial measures are meaningful
and useful measures of real estate organizations operating
performance, however, are not measures defined by IFRS. As
they do not have standardized meanings prescribed by IFRS, they
therefore may not be comparable to similar measurements presented
by other entities and should not be construed as an alternative to
IFRS defined measures. Below are the non-GAAP financial
measures referred to in this earnings release.
Funds From Operations
The IFRS measurement most comparable to FFO is profit
(loss). Boardwalk REIT considers FFO to be an appropriate
measurement of the performance of a publicly listed multi-family
residential entity as it is the most widely used and reported
measure of real estate investment trust performance. Profit
(loss) includes items such as fair value changes of investment
property that are subject to market conditions and capitalization
rate fluctuations which are not representative of recurring
operating performance. We define FFO as adjustments to profit
(loss) for fair value gains or losses, distributions on the LP
Class B Units, gains or losses on the sale of the Trust's
investment properties, depreciation, deferred income tax, and
certain other non-cash adjustments, if any, but after deducting the
principal repayment on lease liabilities and adding the principal
repayment on lease receivables. The reconciliation from
profit (loss) under IFRS to FFO can be found below. The Trust
uses FFO to assess operating performance and its distribution
paying capacity, determine the level of Associate incentive-based
compensation, and decisions related to investment in capital
assets. To facilitate a clear understanding of the combined
historical operating results of Boardwalk REIT, management of the
Trust believes FFO should be considered in conjunction with profit
(loss) as presented in the audited annual consolidated financial
statements for the years ended December 31, 2021 and 2020.
FFO
Reconciliation
|
3 Months
|
3 Months
|
%
Change
|
12 Months
|
12 Months
|
% Change
|
|
Dec 31,
2021
|
Dec 31,
2020
|
|
Dec 31,
2021
|
Dec 31,
2020
|
|
In $000's, except per
Unit amounts
|
|
|
|
|
|
|
Profit
(loss)
|
$
|
131,140
|
$
|
(188,435)
|
|
$
|
446,267
|
$
|
(197,279)
|
|
Adjustments
|
|
|
|
|
|
|
Adjustment to
right-of-use asset related to lease receivable
|
|
-
|
|
-
|
|
|
-
|
|
159
|
|
Loss on sale of
assets
|
|
1,116
|
|
532
|
|
|
1,953
|
|
1,136
|
|
Fair value (gains)
losses
|
|
(96,406)
|
|
219,111
|
|
|
(307,002)
|
|
326,134
|
|
LP Class B Unit
distributions
|
|
1,119
|
|
1,120
|
|
|
4,479
|
|
4,479
|
|
Income tax (recovery)
expense
|
|
(32)
|
|
258
|
|
|
(110)
|
|
(72)
|
|
Depreciation
|
|
2,189
|
|
2,259
|
|
|
7,809
|
|
8,195
|
|
Principal repayments on
lease liabilities
|
|
(977)
|
|
(732)
|
|
|
(3,841)
|
|
(3,465)
|
|
Principal repayments on
lease receivable
|
|
167
|
|
155.00
|
|
|
652
|
|
449
|
|
FFO
|
$
|
38,316
|
$
|
34,268
|
|
11.8%
|
$
|
150,207
|
$
|
139,736
|
|
7.5%
|
FFO per Unit
|
$
|
0.75
|
$
|
0.67
|
|
11.9%
|
$
|
2.94
|
$
|
2.74
|
|
7.3%
|
Adjusted Funds From Operations
Similar to FFO, the IFRS measurement most comparable to AFFO is
profit (loss). Boardwalk REIT considers AFFO to be an
appropriate measurement of a publicly listed multi-family
residential entity as it measures the economic performance after
deducting for maintenance capital expenditures to the existing
portfolio of investment properties. AFFO is determined by
taking the amounts reported as FFO and deducting what is commonly
referred to as "Maintenance Capital Expenditures".
Maintenance Capital Expenditures are referred to as expenditures
that, by standard accounting definition, are accounted for as
capital in that the expenditure itself has a useful life in excess
of the current financial year and maintains the value of the
related assets. The reconciliation of AFFO can be found
below. The Trust uses AFFO to assess operating performance
and its distribution paying capacity, and decisions related to
investment in capital assets.
(000's)
|
3 Months
|
|
3 Months
|
|
12 Months
|
|
12 Months
|
|
|
Dec 31,
2021
|
|
Dec 31,
2020
|
|
Dec 31,
2021
|
|
Dec 31,
2020
|
|
|
|
|
|
|
|
|
|
|
FFO
|
$
|
38,316
|
|
$
|
34,268
|
|
$
|
150,207
|
|
$
|
139,736
|
|
Maintenance Capital
Expenditures
|
|
7,091
|
|
|
8,781
|
|
|
32,287
|
|
|
34,799
|
|
AFFO
|
$
|
31,225
|
|
$
|
25,487
|
|
$
|
117,920
|
|
$
|
104,937
|
|
Adjusted Real Estate Assets
The IFRS measurement most comparable to Adjusted Real Estate
Assets is investment properties. Adjusted Real Estate Assets
is comprised of investment properties, equity accounted investment,
and cash and cash equivalents. Adjusted Real Estate Assets is
useful in summarizing the real estate assets owned by the Trust and
it is used in the calculation of NAV, which management of the Trust
believes is a useful measure in estimating the entity's
value. The reconciliation from Investment Properties under
IFRS to Adjusted Real Estate Assets can be found on the following
page, under Net Asset Value.
Adjusted Real Estate Debt
The IFRS measurement most comparable to Adjusted Real Estate
Debt is mortgages payable. Adjusted Real Estate Debt is
comprised of total mortgage principal outstanding, total lease
liabilities attributable to land leases, and construction loan
payable. It is useful in summarizing the Trust's debt which
is attributable to its real estate assets and is used in the
calculation of NAV, which management of the Trust believes is a
useful measure in estimating the entity's value. The
reconciliation from Mortgages Payable under IFRS to Adjusted Real
Estate Debt can be found below under Net Asset Value.
Net Asset Value
The IFRS measurement most comparable to NAV is Unitholders'
Equity. With real estate entities, NAV is the total value of
the entity's investment properties and cash minus the total value
of the entity's debt. The Trust determines NAV by taking
Adjusted Real Estate Assets and subtracting Adjusted Real Estate
Debt, which management of the Trust believes is a useful measure in
estimating the entity's value. The reconciliation from
Unitholders' Equity under IFRS to Net Asset Value is below.
|
Dec 31,
2021
|
|
Dec 31,
2020
|
|
Investment
properties
|
$
|
6,492,969
|
|
$
|
5,948,955
|
|
Equity accounted
investment
|
|
41,118
|
|
|
34,967
|
|
Cash and cash
equivalents
|
|
64,300
|
|
|
52,960
|
|
Adjusted Real Estate
Assets
|
$
|
6,598,387
|
|
$
|
6,036,882
|
|
|
|
|
|
|
Total mortgage
principal outstanding
|
$
|
(3,088,978)
|
|
$
|
(3,004,086)
|
|
Total lease
liabilities attributable to land leases
|
|
(76,092)
|
|
|
(77,635)
|
|
Construction loan
payable
|
|
(21,187)
|
|
|
(21,187)
|
|
Adjusted Real Estate
Debt
|
$
|
(3,186,257)
|
|
$
|
(3,102,908)
|
|
|
|
|
|
|
Net Asset
Value
|
$
|
3,412,130
|
|
$
|
2,933,974
|
|
Net Asset Value per
Unit
|
$
|
66.87
|
|
$
|
57.49
|
|
Reconciliation of
Unitholders' Equity to Net Asset Value
|
Dec 31,
2021
|
|
Dec 31,
2020
|
|
Unitholders'
equity
|
$
|
3,253,178
|
|
$
|
2,876,449
|
|
Total
assets
|
|
(6,660,653)
|
|
|
(6,107,744)
|
|
Investment
properties
|
|
6,492,969
|
|
|
5,948,955
|
|
Equity accounted
investment
|
|
41,118
|
|
|
34,967
|
|
Cash and cash
equivalents
|
|
64,300
|
|
|
52,960
|
|
Total
liabilities
|
|
3,407,475
|
|
|
3,231,295
|
|
Total mortgage
principal outstanding
|
|
(3,088,978)
|
|
|
(3,004,086)
|
|
Total lease
liabilities attributable to land leases (1)
|
|
(76,092)
|
|
|
(77,635)
|
|
Construction loan
payable
|
|
(21,187)
|
|
|
(21,187)
|
|
Net Asset
Value
|
$
|
3,412,130
|
|
$
|
2,933,974
|
|
(1)
|
Total lease liability
attributable to land leases is a component of lease liabilities as
calculated in accordance with IFRS.
|
Non-GAAP RATIOS
The discussion below outlines the non-GAAP ratios used by the
Trust. Each non-GAAP ratio has a non-GAAP financial measure
as one or more of its components, and, as a result, do not have
standardized meanings prescribed by IFRS and therefore may not be
comparable to similar financial measurements presented by other
entities. Non-GAAP financial measures should not be construed
as alternatives to IFRS defined measures.
FFO per Unit, AFFO per Unit, and NAV per Unit
FFO per Unit includes the non-GAAP financial measure FFO as a
component in the calculation. The Trust uses FFO per Unit to
assess operating performance on a per Unit basis, as well as
determining the level of Associate incentive-based
compensation.
AFFO per Unit includes the non-GAAP financial measure AFFO as a
component in the calculation. The Trust uses AFFO per Unit to
assess operating performance on a per Unit basis and its
distribution paying capacity.
NAV per Unit includes the non-GAAP financial measure NAV in its
composition. Management of the Trust believes it is a useful
measure in estimating the entity's value on a per Unit basis, which
an investor can compare to the entity's Trust Unit price which is
publicly traded to help with investment decisions.
FFO per Unit, AFFO per Unit, and NAV per Unit are calculated by
taking the non-GAAP ratio's corresponding non-GAAP financial
measure and dividing by the weighted average Trust Units
outstanding on a fully diluted basis, which assumes conversion of
the LP Class B Units and deferred units determined in the
calculation of diluted per Unit amounts in accordance with
IFRS.
FFO per Unit Future Financial Guidance
FFO per Unit Future Financial Guidance is calculated as FFO
Future Financial Guidance divided by the Trust Units and LP Class B
Units outstanding as at the end of the fiscal year.
Boardwalk REIT considers FFO per Unit Future Financial Guidance to
be an appropriate measurement of the estimated future financial
performance based on information currently available to management
of the Trust at the date of this earnings release.
AFFO per Unit Future Financial Guidance
AFFO per Unit Future Financial Guidance is calculated as AFFO
Future Financial Guidance divided by the Trust Units and LP Class B
Units outstanding as at the end of the fiscal year.
Boardwalk REIT considers AFFO per Unit Future Financial Guidance to
be an appropriate measurement of the estimated future profitability
based on information currently available to management of the Trust
at the date of this earnings release.
FFO Payout Ratio
FFO Payout Ratio represents the REIT's ability to pay
distributions. This non-GAAP ratio is computed by dividing
regular distributions paid on the Trust Units and LP Class B Units
by the non-GAAP financial measure of FFO.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING
STATEMENTS
Information in this news release that is
not current or historical factual information may constitute
forward-looking statements and information (collectively,
"forward-looking statements") within the meaning of securities
laws. The use of any of the words "expect", "anticipate",
"may", "will", "should", "believe", "intend" and similar
expressions are intended to identify forward-looking
statements. Forward-looking statements contained in this
press release include Boardwalk's financial guidance for fiscal
2022, expected distributions for February, March, and April 2022, and accretive capital recycling
opportunities. Implicit in these forward-looking statements,
particularly in respect of Boardwalk's objectives for its current
and future periods, Boardwalk's strategies to achieve those
objectives, as well as statements with respect to management's
beliefs, plans, estimates, assumptions, intentions, and similar
statements concerning anticipated future events, results,
circumstances, performance or expectations are estimates and
assumptions subject to risks and uncertainties, including those
described in its Management's Discussion & Analysis of
Boardwalk under the heading "Risk and Risk Management", which could
cause Boardwalk's actual results to differ materially from the
forward-looking statements contained in this news release.
Specifically, Boardwalk has made assumptions surrounding the impact
of economic conditions in Canada
and globally including as a result of the COVID-19 pandemic,
Boardwalk's future growth potential, prospects and opportunities,
the rental environment compared to several years ago, relatively
stable interest costs, access to equity and debt capital markets to
fund (at acceptable costs), the future growth program to enable the
Trust to refinance debts as they mature, the availability of
purchase opportunities for growth in Canada, general industry conditions and
trends, changes in laws and regulations including, without
limitation, changes in tax laws, mortgage rules and other temporary
legislative changes in light of the COVID-19 pandemic, increased
competition, the availability of qualified personnel, fluctuations
in foreign exchange or interest rates, and stock market
volatility. These assumptions, although considered reasonable
by the Trust at the time of preparation, may prove to be
incorrect.
This news release also contains future-oriented financial
information and financial outlook information (collectively "FOFI")
about Boardwalk's same property NOI growth, FFO per Unit, and AFFO
per Unit guidance for fiscal 2022. Boardwalk has included the
FOFI for the purpose of providing further information about the
Trust's anticipated future business operation.
For more exhaustive information on the risks and
uncertainties in respect of forward-looking statements and FOFI you
should refer to Boardwalk's Management's Discussion & Analysis
and Annual Information Form for the year ended December 31, 2021 under the headings "Risk and
Risk Management" and "Challenges and Risks", respectively, which
are available at www.sedar.com. Forward-looking statements
and FOFI contained in this news release are made as of the date of
this news release and are based on Boardwalk's current estimates,
expectations and projections, which Boardwalk believes are
reasonable as of the current date. You should not place undue
importance on forward-looking statements or FOFI and should not
rely upon forward-looking statements or FOFI as of any other
date. Except as required by applicable law, Boardwalk
undertakes no obligation to publicly update or revise any
forward-looking statement or FOFI, whether a result of new
information, future events, or otherwise.
View original
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SOURCE Boardwalk Real Estate Investment Trust