SmartCentres Real Estate Investment Trust Releases Third Quarter Results for 2022

SmartCentres Real Estate Investment Trust

Operational

  • Shopping centre leasing activity continues to improve with occupancy levels, inclusive of committed deals, increasing to 98.1% in Q3 2022, representing a 50 basis point increase from Q2 2022

  • Same Properties NOI inclusive of ECL(1) increased by $3.9 million or 3.1% in Q3 2022 as compared to the same period in 2021. Same Properties NOI excluding ECL(1) increased by $3.0 million or 2.3% in Q3 2022 as compared to the same period in 2021

  • Net rental income and other increased by $3.6 million or 2.9% for the three months ended September 30, 2022 as compared to the same period in 2021

Mixed-use Development

  • In excess of three million square feet of construction activity is currently underway, principally on high rise residential projects in Toronto, Montreal, and Ottawa

  • Construction progressing on time and on budget on 241,000 square feet of industrial space for the 16-acre Phase 1 development in Pickering, of which 53% has already been pre-leased to a leading Canadian furniture retailer

  • Construction of Transit City 4 & 5 condominium towers is in the final stages of completion with closings scheduled to commence in Q1 2023. All 1,026 units have been pre-sold

  • Construction of the Millway, a 454-unit purpose-built rental apartment building, is also in the final stages of completion, with initial tenants expected to begin occupancy in Q1 2023

Financial

  • FFO with adjustments and excluding impact of ECL, TRS, condominium and townhome closings, and SmartVMC West acquisition(1) was $93.8 million for the three months ended September 30, 2022, which remained virtually unchanged as compared to $93.9 million for the same period in 2021

  • Net income and comprehensive income was $3.5 million for the three months ended September 30, 2022, as compared to $178.1 million for the same period in 2021, representing a decrease of $174.6 million, which was primarily attributed to a $177.7 million decrease in fair value adjustments on revaluation of investment properties

TORONTO, Nov. 11, 2022 (GLOBE NEWSWIRE) — SmartCentres Real Estate Investment Trust (“SmartCentres”, the “Trust” or the “REIT”) (TSX: SRU.UN) is pleased to report its financial and operating results for the quarter ended September 30, 2022.

“Customer traffic to our Walmart-anchored shopping centre portfolio continues to gain post-pandemic momentum which, in turn, is generating steadily increasing levels of leasing activity that began earlier in 2022,” said Mitchell Goldhar, Executive Chairman and CEO of SmartCentres.

“We anticipate that this trend will continue into 2023 and will have a positive impact on both our occupancy and earnings levels. We are pleased with the noticeable increase in leasing activity in the third quarter and the associated improvement in cash collections.

Our development business is progressing well, with over 735,000 square feet (approximate) of municipal approvals received for residential and mixed-uses in this quarter alone. This brings 6,000,000 square feet of potential on-site growth so far this year. Current projects under construction include over 400,000 square feet of self-storage space across three properties, more than 1,000 condominium units and a further 174 townhomes, over 900 residential rental suites in three separate projects, and a further 413 seniors housing units. Construction has also commenced on a 241,000 square foot industrial project. We expect each of these projects to begin contributing to FFO(1) during 2023 or 2024.

In the immediate term, the next two 45-storey and 50-storey condominium towers at Transit City are sold out and construction is progressing on time and on budget. Closings are expected to commence early in 2023. In addition, The Millway, a 454-unit, 36-storey rental tower, is also proceeding on time and on budget with initial occupancy and rent commencement expected to begin early in 2023. Also, the first phase of our Artwalk condominium project is sold out and construction is expected to commence by spring 2023.

We are also pleased to confirm that we expect to publish our inaugural ESG report in the coming weeks. With respect to the changing economic conditions, we plan on applying discipline when assessing new opportunities for growth. Our focus remains on the long term, including the development of mixed-use projects on our strategically located shopping centre sites which will extract deeply embedded value wherever possible for many years to come,” added Mr. Goldhar.

(1)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release.

Key Business Development, Financial and Operational Highlights for the Three Months Ended September 30, 2022

Mixed-Use Development and Intensification at SmartVMC

  • Park Place condo pre-development is underway on the 53.0 acre SmartVMC West lands strategically acquired in December 2021. Pre-sales for this development have commenced. The Trust’s acquisition in December 2021 of a two-thirds interest in the SmartVMC West lands more than doubled the Trust’s holdings in the 105 acre SmartVMC city centre development.

  • Construction continues on budget on the 100% pre-sold Transit City 4 (45 storeys) and 5 (50 storeys) 1,026-suite condo towers. Concrete and formwork have been completed for both towers, with building envelope and interior finishes ongoing. Closings are expected to commence in early 2023.

  • Construction of the purpose-built rental project, the Millway (36 storeys), continues at SmartVMC. Both formwork and concrete have been completed. Building envelope is ongoing with interior finishes underway. Initial occupancy and rent commencement are expected in spring 2023.

Other Business Development

  • The Trust completed the purchase of approximately 38 acres of industrial lands in Pickering, adjacent to Hwy 407, on which the Trust received approval to build 241,000 square feet of industrial space for the 16 acre Phase 1 development, of which 53% has already been pre-leased to a leading Canadian furniture retailer, with completion currently scheduled for 2023.

  • Leasing continues on the completed first phase of the two-phase, purpose-built residential rental project in Laval, Quebec, with more than 99% of the 171 units rented. Construction continues on the next phase that commenced in October 2021, with a target completion date of Q2 2023.

  • Initial occupancy and rent commencement in the two purpose-built residential rental towers (238 units) in Mascouche, Quebec began in July 2022. More than 130 units have been leased and current lease-up activity is in line with initial expectations.

  • All of the five developed and operating self-storage facilities (Toronto (Leaside), Vaughan NW, Brampton, Oshawa South and Scarborough East) have been well-received by their local communities; current occupancy levels are ahead of expectations.

  • Three self-storage facilities in Markham, Brampton (Kingspoint) and Aurora are currently under construction and on budget, with the latter two facilities expected to be completed in late 2022. Additional self-storage facilities have been approved by the Board of Trustees and the Trust is in the process of obtaining municipal approvals in Whitby, Stoney Creek and two locations in Toronto (Gilbert Ave. and Jane St.). In addition, the municipal approval process is underway in New Westminster and on a newly acquired property in Burnaby, British Columbia.

  • Construction continues on a new retirement residence and a seniors’ apartment project, totalling 402 units, at the Trust’s Laurentian Place in Ottawa, with completion expected in Q1 2024.

  • The Trust intends to commence the redevelopment of a portion of its 73 acre Cambridge retail property (which is subject to a leasehold interest with Penguin) which is now zoned for 12.0 million square feet of residential and commercial uses. Over the coming years, this high profile property will transform into a vibrant urban city center away from the GTA, but strategically within its orbit.

  • The Trust, together with its partner, Penguin, have also commenced preliminary siteworks for the 215,000 square feet retail project on Laird Drive in Toronto, that is expected to feature a flagship 190,000 square foot Canadian Tire store together with 25,000 square feet of additional retail space. Canadian Tire is expected to take possession in 2024.

Financial

  • Net income and comprehensive income(1) was $3.5 million as compared to $178.1 million for the same period in 2021, representing a decrease of $174.6 million. This decrease was primarily attributed to: i) $177.7 million decrease in fair value adjustment on revaluation of investment properties; ii) $4.3 million increase in interest expense; iii) $2.3 million decrease in net operating income; iv) $2.2 million increase in general and administrative expenses (net); v) $0.6 million net income decrease relating to other items; and was partially offset by vi) $9.9 million increase in fair value adjustments on financial instruments; and vii) $2.7 million increase in interest income.

  • The Trust continues to add to its unencumbered pool of high-quality assets. As at September 30, 2022, this unencumbered portfolio consisted of investment properties valued at $8.4 billion (September 30, 2021 – $6.0 billion).

  • The Trust’s fixed rate/variable rate debt ratio(2)(3) was 83%/17% as at September 30, 2022 (December 31, 2021 – 89%/11%).

  • FFO with adjustments excluding impact of ECL, TRS, condominium and townhome closings, and SmartVMC West acquisition(2) was $93.8 million as compared to $93.9 million in the same period last year.

  • During the quarter, 941,990 additional notional Units were added at a weighted average price of $27.42 per Unit to the Total Return Swap.

  • Net income and comprehensive income per Unit(1) decreased by $1.01 or 98% to $0.02 as compared to the same period in 2021, primarily resulting from fair value adjustments on revaluation of investment properties in amount of $177.7 million or $0.99 per Unit.

  • FFO with adjustments excluding impact of ECL, TRS, condominium and townhome closings, and SmartVMC West acquisition per Unit(2) was $0.54, which remained the same as compared to the same period in 2021.

  • Cash flows provided by operating activities(1) increased by $0.7 million or 0.7% to $97.0 million as compared to the same period in 2021. Surplus of cash flows provided by operating activities(1) over distributions declared amounted to $14.6 million (three months ended September 30, 2021 – surplus of $16.6 million).

  • The Payout Ratio relating to cash flows provided by operating activities for the rolling 12 months ended September 30, 2022 was 86.6%, as compared to 96.8% for the same period ended September 30, 2021. The Payout Ratio relating to cash flows provided by operating activities for the rolling 24 months ended September 30, 2022 was 91.3%, as compared to 95.8% for the same period ended September 30, 2021.

  • For the three months ended September 30, 2022, ACFO(2) decreased by $9.3 million or 10.3% to $81.1 million as compared to the same period in 2021.

  • For the three months ended September 30, 2022, there was a shortfall of ACFO(2) over distributions declared of $1.3 million (three months ended September 30, 2021 – surplus of $10.7 million).

  • The Payout Ratio to ACFO(2) for the rolling 12 months ended September 30, 2022 was 98.9%, as compared to 90.1% for the same period ended September 30, 2021. Excluding SmartVMC West LP Class D distributions, the Payout Ratio to ACFO(2) for the rolling 12 months ended September 30, 2022 was 96.7%, as compared to 90.1% for the same period ended September 30, 2021.

  • The Payout Ratio to ACFO(2) for the rolling 24 months ended September 30, 2022 was 94.4%, as compared to 91.0% for the same period ended September 30, 2021. Excluding SmartVMC West LP Class D distributions, the Payout Ratio to ACFO(2) for the rolling 24 months ended September 30, 2022 was 93.3%, as compared to 91.0% for the same period ended September 30, 2021.

Operational

  • Rentals from investment properties and other(1) was $196.7 million, as compared to $195.2 million for the same period in 2021, representing an increase of $1.5 million or 0.8%, primarily due to the acquisition of an additional interest in investment properties in Q1 2022, higher rental income from Premium Outlets locations in both Toronto and Montreal, additional self-storage facility and parking rental revenue, and higher miscellaneous revenue.

  • In-place and committed occupancy rates were 97.6% and 98.1%, respectively, as at September 30, 2022 (June 30, 2022 – 97.2% and 97.6%, respectively).

Subsequent Event

  • Subsequent to September 30, 2022, certain mortgages receivable with Penguin in the amount of $101.4 million were repaid in cash and the proceeds were primarily used to repay a portion of the balance outstanding on the Trust’s revolving operating facility.

(1)   Represents a GAAP measure
(2)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release.
(3)   Net of cash-on-hand of $150.0 million as at September 30, 2022 for the purposes of calculating the applicable ratios.


Selected Consolidated Operational, Mixed-Use Development and Financial Information

Key consolidated operational, mixed-use development and financial information shown in the table below includes the Trust’s proportionate share of equity accounted investments:

(in thousands of dollars, except per Unit and other non-financial data)

September 30, 2022

 

December 31, 2021

 

September 30, 2021

 

Portfolio Information

 

 

 

 

 

 

Number of retail properties

155

 

155

 

156

 

Number of office properties

4

 

4

 

4

 

Number of self-storage properties

6

 

6

 

5

 

Number of residential properties

1

 

1

 

1

 

Number of properties under development

19

 

17

 

15

 

Total number of properties with an ownership interest

185

 

183

 

181

 

Leasing and Operational Information(1)

 

 

 

 

 

 

Gross leasable retail and office area (in thousands of sq. ft.)

34,685

 

34,119

 

34,225

 

Occupied retail and office area (in thousands of sq. ft.)

33,843

 

33,219

 

33,312

 

Vacant retail and office area (in thousands of sq. ft.)

842

 

900

 

913

 

In-place occupancy rate (%)

97.6

 

97.4

 

97.3

 

Committed occupancy rate (%)

98.1

 

97.6

 

97.6

 

Average lease term to maturity (in years)

4.3

 

4.4

 

4.5

 

Net annualized retail rental rate (per occupied sq. ft.) ($)

15.52

 

15.44

 

15.40

 

Net annualized retail rental rate excluding Anchors (per occupied sq. ft.) ($)

22.40

 

22.07

 

21.91

 

Mixed-Use Development Information

 

 

 

 

 

 

Trust’s share of future development area (in thousands of sq. ft.)

39,500

 

40,600

 

32,200

 

Trust’s share of estimated costs of future projects currently under construction, or for which construction is expected to commence within the next five years (in millions of dollars)

9,800

 

9,800

 

7,700

 

Total number of residential rental projects

107

 

104

 

97

 

Total number of seniors’ housing projects

25

 

27

 

39

 

Total number of self-storage projects

35

 

36

 

46

 

Total number of office building projects

8

 

8

 

7

 

Total number of hotel projects

3

 

3

 

4

 

Total number of condominium developments

89

 

95

 

73

 

Total number of townhome developments

8

 

10

 

15

 

Total number of estimated future projects currently in development planning stage

275

 

283

 

281

 

(in thousands of dollars, except per Unit and other non-financial data)

September 30, 2022

 

December 31, 2021

 

September 30, 2021

 

Financial Information

 

 

 

 

 

 

Total assets – GAAP(2)

11,862,633

 

11,293,248

 

10,191,592

 

Total assets – non-GAAP(3)(4)

12,219,429

 

11,494,377

 

10,382,086

 

Investment properties – GAAP(2)

10,211,384

 

9,847,078

 

8,892,656

 

Investment properties – non-GAAP(3)(4)

11,135,415

 

10,684,529

 

9,623,548

 

Total unencumbered assets(3)

8,383,900

 

6,640,600

 

6,002,800

 

Debt – GAAP(2)

5,159,860

 

4,854,527

 

4,539,594

 

Debt – non-GAAP(3)(4)

5,410,319

 

4,983,078

 

4,647,648

 

Debt to Aggregate Assets (%)(3)(4)(5)

43.7

 

42.9

 

44.5

 

Debt to Gross Book Value (%)(3)(4)(5)

52.1

 

50.8

 

50.4

 

Unsecured to Secured Debt Ratio(3)(4)(5)

77%/23%

 

71%/29%

 

70%/30%

 

Unencumbered assets to unsecured debt(3)(4)(5)

2.1X

 

1.9X

 

1.9X

 

Weighted average interest rate (%)(3)(4)

3.67

 

3.11

 

3.25

 

Weighted average term of debt (in years)

4.2

 

4.8

 

5

 

Interest coverage ratio(3)(4)(5)

3.3X

 

3.4X

 

3.3X

 

Adjusted Debt to Adjusted EBITDA (net of cash)(3)(4)(5)

10.0X

 

9.2X

 

8.5X

 

Adjusted Debt to Adjusted EBITDA (net of cash and TRS)(3)(4)(5)

9.8X

 

9.1X

 

8.5X

 

Fixed Rate to Variable Rate Debt Ratio(3)(4)(5)

83%/17%

 

89%/11%

 

94%/6%

 

Equity (book value)(2)

6,141,317

 

5,841,315

 

5,268,176

 

Weighted average number of units outstanding – diluted

179,644,083

 

173,748,819

 

173,535,843

 

(1)   Excluding residential and self-storage area.
(2)   Represents a GAAP measure.
(3)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release.
(4)   Includes the Trust’s proportionate share of equity accounted investments.
(5)   As at September 30, 2022, cash-on-hand of $150.0 million was excluded for the purposes of calculating the applicable ratios (December 31, 2021 – $80.0 million, September 30, 2021 – $50.0 million).

Quarterly Comparison to Prior Year

The following table presents key financial, per Unit, and payout ratio information for the three months ended September 30, 2022 and September 30, 2021:

(in thousands of dollars, except per Unit information)

September 30, 2022

 

September 30, 2021

 

Variance

 

 

(A)

 

(B)

 

(A–B)

 

Financial Information

 

 

 

 

 

 

Rentals from investment properties and other(1)

196,678

 

195,171

 

1,507

 

Net base rent(1)

127,576

 

125,125

 

2,451

 

Total recoveries(1)

59,391

 

60,565

 

(1,174

)

Miscellaneous revenue(1)

4,683

 

4,573

 

110

 

Service and other revenues(1)

5,028

 

4,908

 

120

 

Net income and comprehensive income(1)

3,548

 

178,051

 

(174,503

)

Net income and comprehensive income excluding fair value adjustments(2)(3)

83,927

 

90,691

 

(6,764

)

Cash flows provided by operating activities(1)

97,011

 

96,298

 

713

 

Net rental income and other(1)

127,197

 

123,617

 

3,580

 

NOI from condominium and townhome closings and other adjustments(2)

(244

)

6,444

 

(6,688

)

NOI(2)

130,986

 

133,333

 

(2,347

)

Change in net rental income and other(2)

2.9

%

9.2

%

(6.3

)%

Change in SPNOI(2)

3.1

%

6.6

%

(3.5

)%

Change in SPNOI excluding ECL(2)

2.3

%

(1.0

)%

3.3

%

 

 

 

 

FFO(2)(3)(4)(5)

88,403

 

97,887

 

(9,484

)

Other adjustments

669

 

1,706

 

(1,037

)

FFO with adjustments(2)(3)(4)

89,072

 

99,593

 

(10,521

)

Adjusted for:

 

 

 

ECL

(271

)

670

 

(941

)

Loss (gain) on derivative – TRS

4,900

 

(392

)

5,292

 

FFO sourced from condominium and townhome closings

216

 

(5,922

)

6,138

 

FFO sourced from SmartVMC West acquisition

(154

)

 

(154

)

FFO with adjustments excluding impact of ECL, TRS, condominium and townhome closings, and SmartVMC West acquisition(2)(3)(4)

93,763

 

93,949

 

(186

)

 

 

 

 

ACFO(2)(3)(4)(5)

81,060

 

90,342

 

(9,282

)

Other adjustments

669

 

1,706

 

(1,037

)

ACFO with adjustments(2)(3)(4)

81,729

 

92,048

 

(10,319

)

Adjusted for:

 

 

 

Loss (gain) on derivative – TRS

4,900

 

(392

)

5,292

 

ACFO sourced from condominium and townhome closings

244

 

(6,444

)

6,688

 

ACFO sourced from SmartVMC West acquisition

(154

)

 

(154

)

ACFO with adjustments excluding impact of TRS, condominium and townhome closings, and SmartVMC West acquisition(2)(3)(4)

86,719

 

85,212

 

1,507

 

 

 

 

 

Distributions declared

82,382

 

79,683

 

2,699

 

Surplus of cash provided by operating activities over distributions declared(2)

14,629

 

16,615

 

(1,986

)

(Shortfall) surplus of ACFO over distributions declared(2)

(1,322

)

10,659

 

(11,981

)

Surplus of ACFO with adjustments excluding impact of TRS, condominium and townhome closings, and SmartVMC West acquisition over distributions declared(2)

4,337

 

5,529

 

(1,192

)

Units outstanding(6)

178,126,285

 

172,287,950

 

5,838,335

 

Weighted average – basic

178,123,918

 

172,285,503

 

5,838,415

 

Weighted average – diluted(7)

179,678,009

 

173,644,091

 

6,033,918

 

(in thousands of dollars, except per Unit information)

September 30, 2022

 

September 30, 2021

 

Variance

 

 

(A)

 

(B)

 

(A–B)

 

 

 

 

 

 

 

 

Per Unit Information (Basic/Diluted)

 

 

 

 

 

 

Net income and comprehensive income(1)

$0.02/$0.02

 

$1.03/$1.03

 

$-1.01/$-1.01

 

Net income and comprehensive income excluding fair value adjustments(2)(3)

$0.47/$0.47

 

$0.53/$0.52

 

$-0.06/$-0.05

 

 

 

 

 

 

 

 

FFO(2)(3)(4)(5)

$0.50/$0.49

 

$0.57/$0.56

 

$-0.07/$-0.07

 

Other adjustments

$0.00/$0.01

 

$0.01/$0.01

 

$-0.01/$0.00

 

FFO with adjustments(2)(3)(4)

$0.50/$0.50

 

$0.58/$0.57

 

$-0.08/$-0.07

 

Adjusted for:

 

 

 

 

 

 

ECL(8)

$0.00/$0.00

 

$0.00/$0.00

 

$0.00/$0.00

 

Loss (gain) on derivative – TRS

$0.03/$0.03

 

$0.00/$0.00

 

$0.03/$0.03

 

FFO sourced from condominium and townhome closings

$0.00/$0.00

 

$-0.03/$-0.03

 

$0.03/$0.03

 

FFO units impact from SmartVMC West LP Class D Units

$0.01/$0.01

 

$0.00/$0.00

 

$0.01/$0.01

 

FFO with adjustments excluding impact of ECL, TRS, condominium and townhome closings, and SmartVMC West acquisition(2)(3)(4)

$0.54/$0.54

 

$0.55/$0.54

 

$-0.01/$0.00

 

 

 

 

 

 

 

 

Distributions declared

$0.463

 

$0.463

 

$—

 

 

 

 

 

 

 

 

Payout Ratio Information

 

 

 

 

 

 

Payout Ratio to cash flows provided by operating activities

84.9

%

82.7

%

2.2

%

Payout Ratio to ACFO(2)(3)(4)(5)

101.6

%

88.2

%

13.4

%

Payout Ratio to ACFO with adjustments(2)(3)(4)

100.8

%

86.6

%

14.2

%

Payout Ratio to ACFO with adjustments excluding impact of TRS, condominium and townhome sales, and SmartVMC West acquisition(2)(3)(4)

91.9

%

93.5

%

(1.6

)%

 

 

 

 

 

 

 

(1)   Represents a GAAP measure.
(2)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release.
(3)   Includes the Trust’s proportionate share of equity accounted investments.
(4)   See “Non-GAAP Measures” in this Press Release for a reconciliation of these measures to the nearest consolidated financial statement measure.
(5)   The calculation of the Trust’s FFO and ACFO and related payout ratios, including comparative amounts, are financial metrics that were determined based on the REALpac White Paper on FFO issued in January 2022 and REALpac White Paper on ACFO issued in February 2019, respectively. Comparison with other reporting issuers may not be appropriate. The payout ratio to FFO and the payout ratio to ACFO are calculated as declared distributions divided by FFO and ACFO, respectively.
(6)   Total Units outstanding include Trust Units and LP Units, including Units classified as liabilities. LP Units classified as equity in the consolidated financial statements are presented as non-controlling interests.
(7)   The diluted weighted average includes the vested portion of the deferred units issued pursuant to the deferred unit plan.  
(8)   The impact of ECL on FFO per Unit is less than $0.01 and therefore it is shown as $0.00 in the table above for the three months ended September 30, 2022.


Year-to-Date Comparison to Prior Year

The following table presents key financial, per Unit, and payout ratio information for the nine months ended September 30, 2022 and September 30, 2021:

(in thousands of dollars, except per Unit information)

September 30, 2022

 

September 30, 2021

 

Variance

 

 

(A)

 

(B)

 

(A–B)

 

Financial Information

 

 

 

 

 

 

Rentals from investment properties and other(1)

597,497

 

587,946

 

9,551

 

Net base rent(1)

380,082

 

369,955

 

10,127

 

Total recoveries(1)

196,896

 

196,342

 

554

 

Miscellaneous revenue(1)

10,414

 

10,412

 

2

 

Service and other revenues(1)

10,105

 

11,237

 

(1,132

)

Net income and comprehensive income(1)

535,655

 

335,595

 

200,060

 

Net income and comprehensive income excluding fair value adjustments(2)(3)

253,910

 

260,400

 

(6,490

)

Cash flows provided by operating activities(1)

243,800

 

237,950

 

5,850

 

Net rental income and other(1)

372,575

 

358,886

 

13,689

 

NOI from condominium and townhome closings and other adjustments(2)

496

 

20,538

 

(20,042

)

NOI(2)

384,888

 

388,405

 

(3,517

)

Change in net rental income and other(2)

3.8

%

4.7

%

(0.9

)%

Change in SPNOI(2)

3.3

%

3.4

%

(0.1

)%

Change in SPNOI excluding ECL(2)

5.5

%

(2.1

)%

7.6

%

 

 

 

 

FFO(2)(3)(4)(5)

269,102

 

282,620

 

(13,518

)

Other adjustments

2,566

 

2,566

 

 

FFO with adjustments(2)(3)(4)

271,668

 

285,186

 

(13,518

)

Adjusted for:

 

 

 

ECL

(2,547

)

5,251

 

(7,798

)

Loss (gain) on derivative – TRS

11,138

 

(1,462

)

12,600

 

FFO sourced from condominium and townhome closings

(860

)

(18,813

)

17,953

 

FFO sourced from SmartVMC West acquisition

(613

)

 

(613

)

FFO with adjustments excluding impact of ECL, TRS, condominium and townhome closings, and SmartVMC West acquisition(2)(3)(4)

278,786

 

270,162

 

8,624

 

 

 

 

 

FFO with adjustments and Transactional FFO(2)(3)(4)

271,668

 

286,773

 

(15,105

)

 

 

 

 

ACFO(2)(3)(4)(5)

247,085

 

269,743

 

(22,658

)

Other adjustments

2,566

 

2,566

 

 

ACFO with adjustments(2)(3)(4)

249,651

 

272,309

 

(22,658

)

Adjusted for:

 

 

 

Loss (gain) on derivative – TRS

11,138

 

(1,462

)

12,600

 

ACFO sourced from condominium and townhome closings

(496

)

(20,538

)

20,042

 

ACFO sourced from SmartVMC West acquisition

(613

)

 

(613

)

ACFO with adjustments excluding impact of TRS, condominium and townhome closings, and SmartVMC West acquisition(2)(3)(4)

259,680

 

250,309

 

9,371

 

 

 

 

 

Distributions declared

247,145

 

239,028

 

8,117

 

Shortfall of cash flows provided by operating activities over distributions declared(2)

(3,345

)

(1,078

)

(2,267

)

(Shortfall) surplus of ACFO over distributions declared(2)

(60

)

30,715

 

(30,775

)

Surplus of ACFO with adjustments excluding impact of TRS, condominium and townhome closings, and SmartVMC West acquisition over distributions declared(2)

12,535

 

11,281

 

1,254

 

Units outstanding(6)

178,126,285

 

172,287,950

 

5,838,335

 

Weighted average – basic

178,118,504

 

172,266,602

 

5,851,902

 

Weighted average – diluted(7)

179,644,083

 

173,535,843

 

6,108,240

 

(in thousands of dollars, except per Unit information)

September 30, 2022

 

September 30, 2021

 

Variance

 

 

(A)

 

(B)

 

(A–B)

 

 

 

 

 

 

 

 

Per Unit Information (Basic/Diluted)

 

 

 

 

 

 

Net income and comprehensive income(1)

$3.01/$2.98

 

$1.95/$1.93

 

$1.06/$1.05

 

Net income and comprehensive income excluding fair value adjustments(2)(3)

$1.43/$1.41

 

$1.51/$1.50

 

$-0.08/$-0.09

 

 

 

 

 

 

 

 

FFO(2)(3)(4)(5)

$1.51/$1.50

 

$1.64/$1.63

 

$-0.13/$-0.13

 

Other adjustments

$0.02/$0.01

 

$0.02/$0.01

 

$0.00/$0.00

 

FFO with adjustments(2)(3)(4)

$1.53/$1.51

 

$1.66/$1.64

 

$-0.13/$-0.13

 

Adjusted for:

 

 

 

 

 

 

ECL

$-0.01/$-0.01

 

$0.03/$0.03

 

$-0.04/$-0.04

 

Loss (gain) on derivative – TRS

$0.06/$0.06

 

$-0.01/$-0.01

 

$0.07/$0.07

 

FFO sourced from condominium and townhome closings

$0.00/$0.00

 

$-0.11/$-0.10

 

$0.11/$0.10

 

FFO units impact from SmartVMC West LP Class D Units

$0.04/$0.04

 

$0.00/$0.00

 

$0.04/$0.04

 

FFO with adjustments excluding impact of ECL, TRS, condominium and townhome closings, and SmartVMC West acquisition(2)(3)(4)

$1.62/$1.60

 

$1.57/$1.56

 

$0.05/$0.04

 

 

 

 

 

 

 

 

FFO with adjustments and Transactional FFO(2)(3)(4)

$1.53/$1.51

 

$1.66/$1.65

 

$-0.13/$-0.14

 

Distributions declared

$1.39

 

$1.39

 

$—

 

 

 

 

 

 

 

 

Payout Ratio Information

 

 

 

 

 

 

Payout Ratio to cash flows provided by operating activities

101.4

%

100.5

%

0.9

%

Payout Ratio to ACFO(2)(3)(4)(5)

100.0

%

88.6

%

11.4

%

Payout Ratio to ACFO with adjustments(2)(3)(4)

99.0

%

87.8

%

11.2

%

Payout Ratio to ACFO with adjustments excluding impact of TRS, condominium and townhome sales, and SmartVMC West acquisition(2)(3)(4)

92.1

%

95.5

%

(3.4

)%

 

 

 

 

 

 

 

(1)   Represents a GAAP measure.
(2)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release.
(3)   Includes the Trust’s proportionate share of equity accounted investments.
(4)   See “Non-GAAP Measures” in this Press Release for a reconciliation of these measures to the nearest consolidated financial statement measure.
(5)   The calculation of the Trust’s FFO and ACFO and related payout ratios, including comparative amounts, are financial metrics that were determined based on the REALpac White Paper on FFO issued in January 2022 and REALpac White Paper on ACFO issued in February 2019, respectively. Comparison with other reporting issuers may not be appropriate. The payout ratio to FFO and the payout ratio to ACFO are calculated as declared distributions divided by FFO and ACFO, respectively.
(6)   Total Units outstanding include Trust Units and LP Units, including Units classified as liabilities. LP Units classified as equity in the consolidated financial statements are presented as non-controlling interests.
(7)   The diluted weighted average includes the vested portion of the deferred units issued pursuant to the deferred unit plan.   

Operational Highlights

For the three months ended September 30, 2022, net income and comprehensive income decreased by $174.5 million as compared to the same period in 2021. This decrease was primarily attributed to the following:

  • $177.7 million decrease in fair value adjustments on revaluation of investment properties (see details in the “Investment Property” section in the Trust’s MD&A);

  • $4.3 million increase in interest expense (see further details in the “Interest Income and Interest Expense” subsection in the Trust’s MD&A);

  • $2.3 million decrease in NOI (see further details in the “Net Operating Income” subsection in the Trust’s MD&A);

  • $2.2 million increase in general and administrative expenses (net) (see further details in the “General and Administrative Expense” section in the Trust’s MD&A);

  • $0.5 million higher loss on sale of investment properties; and

  • $0.1 million increase in supplemental costs;

Partially offset by the following:

  • $9.9 million increase in fair value adjustment on financial instruments primarily due to: i) $12.8 million higher fair value gains on those Units classified as liabilities due to fluctuation in the Trust’s Unit price, ii) $3.9 million higher fair value gains relating to unit-based incentive programs due to fluctuation in the Trust’s Unit price, and partially offset by: iii) $5.3 million higher fair value loss of TRS due to fluctuation in the Trust’s Unit price, and iv) $1.5 million decrease in fair value adjustments of interest rate swap agreements (see further details in the “Debt” subsection in the Trust’s MD&A); and

  • $2.7 million increase in interest income mainly due to higher interest rates.

For the nine months ended September 30, 2022, net income and comprehensive income increased by $200.1 million as compared to the same period in 2021. This increase was primarily attributed to the following:

  • $114.6 million increase in fair value adjustment on financial instruments primarily due to: i) $63.1 million higher fair value gains on those Units classified as liabilities due to fluctuation in the Trust’s Unit price, ii) $40.6 million increase in fair value adjustments pertaining to interest rate swap agreements (see further details in the “Debt” subsection in the Trust’s MD&A), iii) $23.5 million higher fair value gains relating to unit-based incentive programs also due to fluctuation in the Trust’s Unit price, and partially offset by: iv) $12.6 million higher fair value loss on the TRS due to fluctuation in the Trust’s Unit price;

  • $92.0 million increase in fair value adjustments on revaluation of investment properties, of which: i) $237.7 million increase relates to the fair value adjustment associated with certain properties under development, ii) $251.2 million decrease relates to cap rate changes, iii) $14.2 million increase relates to gain from acquisition, and iv) $91.3 million increase relates to the revaluation of investment properties, principally driven by leasing and assumption updates (see details in the “Investment Property” section in the Trust’s MD&A);

  • $1.9 million increase in interest income mainly due to higher interest rates; and

  • $0.7 million decrease in interest expense (see further details in the “Interest Income and Interest Expense” section in the Trust’s MD&A);

Partially offset by the following:

  • $3.5 million decrease in NOI (see further details in the “Net Operating Income” subsection in the Trust’s MD&A);

  • $2.4 million increase in supplemental costs;

  • $2.3 million increase in general and administrative expenses (net) (see further details in the “General and Administrative Expense” section in the Trust’s MD&A);

  • $0.5 million higher loss on sale of investment properties; and

  • $0.3 million increase in acquisition-related costs.

Development and Intensification Summary
The following table summarizes the 275 identified mixed-use, recurring rental income and development income initiatives, which are included in the Trust’s large development pipeline:

 

Underway

 

Active

 

Future

 

 

 

Description

(Construction underway or expected to commence within next 2 years)

 

(Construction expected to commence within next 3–5 years)

 

(Construction expected to commence after 5 years)

 

Total

 

Number of projects in which the Trust has an ownership interest

 

 

 

 

 

 

 

 

Residential Rental

29

 

20

 

58

 

107

 

Seniors’ Housing

4

 

8

 

13

 

25

 

Self-storage

12

 

7

 

16

 

35

 

Office Buildings

 

1

 

7

 

8

 

Hotels

 

 

3

 

3

 

Subtotal – Recurring rental income initiatives

45

 

36

 

97

 

178

 

Condominium developments

23

 

20

 

46

 

89

 

Townhome developments

2

 

1

 

5

 

8

 

Subtotal – Development income initiatives

25

 

21

 

51

 

97

 

Total

70

 

57

 

148

 

275

 

Trust’s share of project area (in thousands of sq. ft.)

 

 

 

 

 

 

 

 

Recurring rental income initiatives

5,600

 

3,900

 

11,900

 

21,400

 

Development income initiatives

5,100

 

3,500

 

9,500

 

18,100

 

Total Trust’s share of project area (in thousands of sq. ft.)

10,700

 

7,400

 

21,400

 

39,500

 

Trust’s share of such estimated costs (in millions of dollars)

5,750

 

4,050

 

(1)

 

9,800

 

(1)    The Trust has not fully determined the costs attributable to future projects expected to commence after five years and as such they are not included in this table.

The Trust is currently working on initiatives for the development of many properties for which final municipal approvals have been obtained or are being actively pursued. Completion, milestone or occupancy dates of each of the projects described below may be delayed or adversely impacted as a result of, among other things, restrictions or delays related to the COVID-19 pandemic.

  1. the development of up to 5.3 million square feet of predominately residential space, in various forms, at Highway 400 & Highway 7, in Vaughan, Ontario, with a rezoning application submitted in December 2019 and a site plan application for the first four residential buildings totalling 1,742 units submitted in October 2020. Currently working with the City of Vaughan on advancement of Weston & Highway 7 Secondary Plan;

  2. the development of up to 5.0 million square feet of predominately residential space, in various forms over the long term, in Pickering, Ontario, with the zoning for five towers with a gross floor area of approximately 1,400,000 square feet and site plan application for a three-tower mixed-use phase, approximating 700,000 square feet, approved by Council in June 2022;

  3. the development of up to 5.5 million square feet of predominately residential space, in various forms, at Oakville North in Oakville, Ontario, with the official plan and zoning amendment applications for an initial two-tower 587-unit residential phase submitted in April 2021;

  4. the development of up to 2.6 million square feet of predominately residential space, in various forms, at the Westside Mall in Toronto, Ontario, with a zoning application for the first 35-storey mixed-use tower submitted in Q1 2021, and targeting site plan application by the end of the year;

  5. the development of up to 1.5 million square feet of residential space in various forms on the Trust’s undeveloped lands at the Vaughan NW property in Vaughan, Ontario. Approximately 60% of the 174 draft plan approved townhomes have been pre-sold and construction is soon expected to commence. Rezoning application for a seniors’ apartment building and separate retirement residence, both of which are to be developed in partnership with Revera, along with three other residential buildings, was approved by Council in June 2022;

  6. the development of up to 1.5 million square feet of residential space, in various forms, in Pointe-Claire, Quebec, with the first phase, a two-tower rental project, being actively pursued, but subject to the urban planning revision process by the city of Pointe-Claire;

  7. the development of up to 200,000 square feet of residential townhomes at Oakville South in Oakville, Ontario;

  8. the intensification of the Toronto StudioCentre (“StudioCentre”) in Toronto, Ontario (zoning allows for up to 1.2 million square feet);

  9. the development of four high-rise purpose-built residential rental buildings comprising approximately 1,700 units with Greenwin, in Barrie, Ontario, for which a zoning application was approved by Barrie City Council in January 2021 with the site plan approved for Phase 1 by Barrie City Council in June 2021. An application for a building permit was submitted in July 2021. Environmental Risk Assessment was approved for the entire site in September 2021 and the application of Certificate of Property Use was submitted in February 2022 and approved in September 2022;

  10. the development of a 35-storey high-rise purpose-built residential rental tower containing 437 units, on Balliol Street in midtown Toronto, Ontario, with zoning and site plan applications submitted in September 2020. A second submission of these applications was made in July 2021. A third submission of these applications was made in March 2022. Zoning approval was received in July 2022 and site plan approval is expected in Q4 2022;

  11. the development of up to 1,600 residential units, in various forms, in Mascouche, Quebec, with the first phase consisting of 238 units in two 10-storey rental towers approved by municipal council in August 2020. Construction began in April 2021, and the first four floors opened in July 2022 and another five floors have since opened, with the last floor scheduled to open in November 2022. Construction of a second phase is expected to commence in Q2 2023;

  12. the development of residential density at the Trust’s shopping centre at 1900 Eglinton Avenue East in Scarborough, Ontario, with rezoning applications for the first two residential towers (46 and 48 storeys) submitted in January 2021. Site plan application for both buildings was submitted in December 2021;

  13. the development of the first phase, 46-unit rental building, which is part of a multi-phase master plan in Alliston, Ontario, with a rezoning application approved by Council in December 2020 and a site plan application submitted in May 2020. The site plan application was resubmitted in March 2021 and again in July 2021 and approved in July 2022. The building permit application was submitted in October 2021 and a partial permit was received in September 2022;

  14. besides the eight self-storage projects completed or under construction, there are six additional self-storage facilities in Ontario and British Columbia with the Trust’s partner, SmartStop, in Stoney Creek, Toronto (2), Whitby, New Westminster and Burnaby with zoning and/or site plan approval obtained or applications well underway. Project agreements for another three locations are being finalized;

  15. the Q4 2020 acquisition of an additional 33.33% interest (new ownership structure of 66.66% held by the Trust and 33.33% held by Penguin) in 50 acres of adjacent land to the Trust’s Premium Outlets Montreal in Mirabel, Quebec, for the ultimate development of residential density of up to 4,500 units. Site plan applications for the first phase rental building with 168 units expected to be submitted in Q4 2022. Master plan of development for the site is subject to approval;

  16. the development of a new residential block consisting of a 155-unit building in Phase 1 and approximately 345 rental units in Phases 2 and 3 at Laval Centre in Quebec. The application for architecture approval for Phase 1 and Phase 2 (155 units) was submitted in Q4 2021 and approved in Q3 2022;

  17. the Trust has commenced the redevelopment of a portion of its 73-acre Cambridge retail property (subject to a leasehold interest with Penguin) which now allows various forms of residential, retail, office, institutional and commercial uses providing for the creation of a vibrant urban community with the potential for over 12.0 million square feet of development on the overall property once completed;

  18. the development of a retirement living residence at the Trust’s shopping centre at Bayview and Major Mackenzie in Richmond Hill, Ontario, with a rezoning application for a nine-storey retirement residences building submitted in Q1 2021 and a site plan application submitted in Q4 2021, to be developed in partnership with the existing partner and Revera;

  19. the development of 1.5 million square feet of residential density adjacent to the new South Keys light rail train station at the Trust’s Ottawa South Keys Centre, consistent with current zoning permissions. Site plan application for the first phase rental complex with 446 units was submitted and deemed complete in Q4 2021 and work is ongoing on a second submission to respond to agency comments on the application;

  20. the development of up to 900,000 square feet of predominately residential space on Yonge St. in Aurora, Ontario, with rezoning applications for the entire site and site plan submitted for Phase 1 in July 2021 and resubmitted in April 2022;

  21. the Q4 2020 acquisition of a 50% interest in a property in downtown Markham for the development of a 243,000 square foot retirement residence with Revera. The rezoning application was submitted in December 2020, and an appeal was filed in July 2022 for the initial Official Plan Amendment & Zoning By-law Amendment submission;

  22. the development of approximately 900,000 square feet of residential density on the Trust’s Parkway Plaza Centre in Stoney Creek, Ontario, with an application for a Phase 1 development for a two-tower (20 and 15 storeys), 400,000 square foot, 520-unit condo project submitted in Q4 2021; and

  23. during the second quarter of 2022, the Trust completed the purchase of approximately 38 acres of industrial lands in Pickering, adjacent to Hwy 407, on which the Trust received approval to build 241,000 square feet of space for the 16-acre Phase 1 development, of which 53% has already been pre-leased, and completion is currently scheduled for 2023.

Proportionately Consolidated Balance Sheets (including the Trust’s interests in equity accounted investments)

The following table presents the proportionately consolidated balance sheets, which includes a reconciliation of the Trust’s proportionate share of equity accounted investments:

(in thousands of dollars)

September 30, 2022

December 31, 2021

 

GAAP Basis

 

Proportionate Share Reconciliation

 

Total Proportionate Share(1)

 

GAAP Basis

 

Proportionate Share Reconciliation

 

Total Proportionate Share(1)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

 

 

 

 

 

 

Investment properties

10,211,384

 

924,031

 

11,135,415

 

9,847,078

 

837,451

 

10,684,529

 

Equity accounted investments

646,393

 

(646,393

)

 

654,442

 

(654,442

)

 

Mortgages, loans and notes receivable

281,128

 

(79,910

)

201,218

 

345,089

 

(69,576

)

275,513

 

Other financial assets

289,477

 

 

289,477

 

97,148

 

 

97,148

 

Other assets

82,495

 

7,600

 

90,095

 

80,940

 

7,465

 

88,405

 

Intangible assets

44,140

 

 

44,140

 

45,139

 

 

45,139

 

 

11,555,017

 

205,328

 

11,760,345

 

11,069,836

 

120,898

 

11,190,734

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

 

 

 

 

Residential development inventory

31,891

 

105,544

 

137,435

 

27,399

 

67,828

 

95,227

 

Current portion of mortgages, loans and notes receivable

144,490

 

 

144,490

 

71,947

 

 

71,947

 

Amounts receivable and other

61,573

 

(9,064

)

52,509

 

49,542

 

(8,637

)

40,905

 

Prepaid expenses, deposits and deferred financing costs

50,187

 

19,141

 

69,328

 

12,289

 

13,118

 

25,407

 

Cash and cash equivalents

19,475

 

35,847

 

55,322

 

62,235

 

7,922

 

70,157

 

 

307,616

 

151,468

 

459,084

 

223,412

 

80,231

 

303,643

 

Total assets

11,862,633

 

356,796

 

12,219,429

 

11,293,248

 

201,129

 

11,494,377

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Debt

4,746,915

 

193,003

 

4,939,918

 

4,176,121

 

93,465

 

4,269,586

 

Other financial liabilities

265,462

 

 

265,462

 

326,085

 

 

326,085

 

Other payables

17,283

 

46

 

17,329

 

18,243

 

 

18,243

 

 

5,029,660

 

193,049

 

5,222,709

 

4,520,449

 

93,465

 

4,613,914

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Current portion of debt

412,945

 

57,456

 

470,401

 

678,406

 

35,086

 

713,492

 

Accounts payable and current portion of other payables

278,711

 

106,291

 

385,002

 

253,078

 

72,578

 

325,656

 

 

691,656

 

163,747

 

855,403

 

931,484

 

107,664

 

1,039,148

 

Total liabilities

5,721,316

 

356,796

 

6,078,112

 

5,451,933

 

201,129

 

5,653,062

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

Trust Unit equity

5,111,730

 

 

5,111,730

 

4,877,961

 

 

4,877,961

 

Non-controlling interests

1,029,587

 

 

1,029,587

 

963,354

 

 

963,354

 

 

6,141,317

 

 

6,141,317

 

5,841,315

 

 

5,841,315

 

  Total liabilities and equity

11,862,633

 

356,796

 

12,219,429

 

11,293,248

 

201,129

 

11,494,377

 

(1)   This column contains non-GAAP measures because it includes figures that are recorded in equity accounted investments. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release.

Proportionately Consolidated Statements of Income and Comprehensive Income (including the Trust’s Interests in Equity Accounted Investments)
The following tables present the proportionately consolidated statements of income and comprehensive income, which include a reconciliation of the Trust’s proportionate share of equity accounted investments:

Quarterly Comparison to Prior Year

(in thousands of dollars)

Three Months Ended September 30, 2022

 

Three Months Ended September 30, 2021

 

 

 

 

GAAP Basis

 

Proportionate Share Reconciliation

 

Total Proportionate Share(1)

 

GAAP Basis

 

Proportionate Share Reconciliation

 

Total Proportionate Share(1)

 

Variance of Total Proportionate Share(1)

 

Net rental income and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rentals from investment properties and other

196,678

 

7,570

 

204,248

 

195,171

 

5,486

 

200,657

 

3,591

 

Property operating costs and other

(69,451

)

(3,567

)

(73,018

)

(71,554

)

(2,214

)

(73,768

)

750

 

 

127,227

 

4,003

 

131,230

 

123,617

 

3,272

 

126,889

 

4,341

 

Condo and townhome closings revenue and other(2)

 

7

 

7

 

 

23,904

 

23,904

 

(23,897

)

Condo and townhome cost of sales and other

(30

)

(221

)

(251

)

 

(17,460

)

(17,460

)

17,209

 

 

(30

)

(214

)

(244

)

 

6,444

 

6,444

 

(6,688

)

NOI

127,197

 

3,789

 

130,986

 

123,617

 

9,716

 

133,333

 

(2,347

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income and expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expense, net

(10,696

)

(3

)

(10,699

)

(8,435

)

(71

)

(8,506

)

(2,193

)

Earnings from equity accounted investments

1,101

 

(1,101

)

 

14,302

 

(14,302

)

 

 

Earnings from other(3)

284

 

(284

)

 

 

 

 

 

Fair value adjustment on revaluation of investment properties

(92,557

)

411

 

(92,146

)

79,015

 

6,509

 

85,524

 

(177,670

)

Loss (gain) on sale of investment properties

(112

)

(241

)

(353

)

149

 

 

149

 

(502

)

Interest expense

(39,175

)

(1,553

)

(40,728

)

(35,032

)

(1,348

)

(36,380

)

(4,348

)

Interest income

5,714

 

(375

)

5,339

 

2,599

 

22

 

2,621

 

2,718

 

Supplemental costs

 

(643

)

(643

)

 

(526

)

(526

)

(117

)

Fair value adjustment on financial instruments

11,767

 

 

11,767

 

1,836

 

 

1,836

 

9,931

 

Acquisition-related costs

25

 

 

25

 

 

 

 

25

 

Net income and comprehensive income

3,548

 

 

3,548

 

178,051

 

 

178,051

 

(174,503

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)   This column contains non-GAAP measures because it includes figures that are recorded in equity accounted investments. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release.
(2)   Includes additional partnership profit and other revenues.
(3)   Represents SmartVMC West’s operating results.

Year-to-Date Comparison to Prior Year

(in thousands of dollars)

Nine Months Ended September 30, 2022

 

Nine Months Ended September 30, 2021

 

 

 

 

GAAP Basis

 

Proportionate Share Reconciliation

 

Total Proportionate Share(1)

 

GAAP Basis

 

Proportionate Share Reconciliation

 

Total Proportionate Share(1)

 

Variance of Total Proportionate Share(1)

 

Net rental income and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rentals from investment properties and other

597,497

 

21,080

 

618,577

 

587,946

 

15,556

 

603,502

 

15,075

 

Property operating costs and other

(224,497

)

(9,688

)

(234,185

)

(229,060

)

(6,575

)

(235,635

)

1,450

 

 

373,000

 

11,392

 

384,392

 

358,886

 

8,981

 

367,867

 

16,525

 

Condo and townhome closings revenue and other(2)

 

4,524

 

4,524

 

 

76,837

 

76,837

 

(72,313

)

Condo and townhome cost of sales and other

(425

)

(3,603

)

(4,028

)

 

(56,299

)

(56,299

)

52,271

 

 

(425

)

921

 

496

 

 

20,538

 

20,538

 

(20,042

)

NOI

372,575

 

12,313

 

384,888

 

358,886

 

29,519

 

388,405

 

(3,517

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income and expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expense, net

(25,479

)

(107

)

(25,586

)

(23,219

)

(76

)

(23,295

)

(2,291

)

Earnings from equity accounted investments

4,312

 

(4,312

)

 

51,371

 

(51,371

)

 

 

Earnings from other(3)

878

 

(878

)

 

 

 

 

 

Fair value adjustment on revaluation of investment properties

188,457

 

2,042

 

190,499

 

71,110

 

27,439

 

98,549

 

91,950

 

Loss on sale of investment properties

(216

)

(241

)

(457

)

91

 

 

91

 

(548

)

Interest expense

(108,360

)

(3,952

)

(112,312

)

(108,886

)

(4,082

)

(112,968

)

656…