2013-02-20 21:21:43 -
TORONTO, ONTARIO -- (Marketwire) -- 02/20/13 --
This news release contains forward-looking information that is based upon assumptions and is subject to risks and uncertainties as indicated in the cautionary note contained within this press release.
DUNDEE REIT (TSX:D.UN) today announced its financial results for the three and twelve months ended December 31, 2012, posting gains in comparative property performance and adjusted funds from operations per unit.
HIGHLIGHTS
-- 4 cent increase to annualized distribution
-- Appointment of Ana Radic as COO
-- Completed $575.5 million sale of Industrial Portfolio and $104.8 million
sale of other of non-core properties
-- Redeemed $126.5 million of convertible debentures, reducing debt level
and interest costs
-- 48% debt-to-gross book value; 2.7 times interest coverage ratio; 5.1
year average term to maturity
-- 6.3% increase in per unit funds from operations ("FFO") for the 12-month
period
-- 3.4% increase in per unit adjusted funds from operations ("AFFO") for
the 12-month period
-- 2.6% growth in comparative properties net operating income ("NOI") for
the 12-month period
-- Occupancy strong at 95.1%; average in-place net rents 12% below
estimated market rents
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SELECTED FINANCIAL INFORMATION
(unaudited) Years ended
Three Months Ended December 31,
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($000's except
unit and per unit December September December
amounts) 31, 2012 30, 2012 31, 2011 2012 2011
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Investment
properties
revenue (1) $ 191,999 $ 187,327 $ 126,912 $ 686,564 $404,774
Net operating
income ("NOI")
(1)(2) 105,853 105,367 70,065 385,821 229,439
Funds from
operations
("FFO") (3) 68,905 72,879 48,210 263,488 159,397
Adjusted funds
from operations
("AFFO") (4) 58,060 61,286 41,047 221,960 137,675
Investment
properties value
(1) 6,536,722 6,895,755 4,426,383
Debt (1) 3,314,594 3,580,610 2,254,756
Per unit data
(basic)
FFO $ 0.68 $ 0.72 $ 0.73 $ 2.86 $ 2.69
AFFO 0.57 0.61 0.62 2.41 2.33
Distributions 0.55 0.55 0.55 2.20 2.20
Units (period end)
REIT Units, Series
A 97,618,625 96,984,321 66,193,060
REIT Units, Series
B 16,316 16,316 16,316
LP Class B Units,
Series 1 3,528,658 3,522,835 3,506,107
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Total number of
units 101,163,599 100,523,472 69,715,483
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Portfolio gross
leasable area
(sq. ft.) (5) 22,948,293 22,365,500 18,941,594
Occupied and
committed space
(5) 95.1 95.1% 95.6%
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See footnotes on page 4.
"Dundee REIT is entering its tenth year better and stronger than ever," said Michael Cooper, Vice Chairman and CEO of Dundee REIT. "We have a portfolio of high quality assets that are producing consistent results and a strong, conservative balance sheet. Overall, our business has never been in better shape."
Senior management will host a conference call to discuss the results tomorrow, February 21, 2013 at 2:00 p.m. (ET). To access the call, please dial: 416-849-5525 or toll free at 1-866-200-6965 and using passcode 63895136#. A taped replay of the call will be available for 30 days by dialling 646-216-7204 or 1-866-206-0173 and using passcode 279189#. To access the conference call via webcast, please go to Dundee REIT's website at www.dundeereit.com : www.dundeereit.com and click on the link for News & Events, then click on Calendar of Events. The webcast will be archived for 30 days.
PORTFOLIO ACTIVITY
The Trust was very active in the commercial property investment markets throughout the year. Acquisitions completed throughout 2012 totalled $2.6 billion and added 9.9 million square feet of high quality office properties to its portfolio. In addition, the Trust remained focused on pruning its portfolio, completing the sale of $680.2 million of non-strategic assets totalling 5.8 million square feet.
Acquisitions
In the fourth quarter, Dundee REIT acquired a co-owner's interest in nine suburban properties in Edmonton for $75.8 million and also acquired its co-owner's interest in State Street Financial Centre in downtown Toronto for approximately $77.3 million.
Approx. Purchase
Year-ended December Property GLA price
31, 2012 type (sq. ft.) ($000's)(i) Date
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5001 Yonge Street,
Toronto office 309,138 $ 107,775 January 19, 2012
67 Richmond Street
West, Toronto office 44,996 13,500 January 30, 2012
Whiterock Portfolio office/
industrial/
retail 7,368,679 1,419,700 March 2, 2012
Parking lots,
Saskatoon - 9,567 18,000 March 12, 2012
1 Riverside Drive,
Windsor office 235,915 35,800 April 26, 2012
Scotia Plaza (two-
thirds ownership
interest) office 1,317,795 844,339 June 15, 2012
Transamerica
Portfolio (ROI Share
at 60%) office 373,121 74,902 October 4, 2012
30 Adelaide St. E.,
Toronto (share at
50%) office 206,967 77,250 December 28, 2012
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Total closed in 2012 9,866,178 2,591,266
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(i)Purchase price excludes transaction costs.
Dispositions
During the quarter, the Trust completed the disposition of its industrial portfolio for gross proceeds of approximately $575.5 million and also completed the sale of other non-strategic assets for gross proceeds of approximately $104.8 million.
###PRECONTENT2###
"I'm very pleased that we have been able to redeploy the cash proceeds from the sale of our industrial portfolio in a way that generates a high return and reduces our leverage," said Mario Barrafato, Chief Financial Officer of Dundee REIT.
CAPITAL INITIATIVES
The Trust remains focused on balance sheet management, redeploying excess cash received from asset sales in the fourth quarter to reduce its overall debt level. On December 31, 2012, $126.5 million was utilized by the Trust to redeem four series of its convertible debentures bearing interest at a weighted average face rate of 6% (6.8% effective rate factoring in costs); contributing to a reduction of debt-to-gross book value to 48.0% (September 30, 2012 - 50.5%, December 31, 2011 - 49.0%) and decreasing its weighted average interest rate.
###PRECONTENT3###
Other information
Information appearing in this news release is a select summary of results. The consolidated financial statements and management's discussion and analysis for the Trust, as well as its Supplementary Information Package are available at www.dundeereit.com : www.dundeereit.com and on www.sedar.com.
Dundee REIT is an unincorporated, open-ended real estate investment trust. Dundee REIT is focused on owning, acquiring, leasing and managing well-located, high-quality central business district and suburban office properties. Its portfolio currently comprises approximately 23.1 million square feet of gross leasable area in major urban centres across Canada. Dundee REIT's portfolio is well diversified by geographic location and tenant mix. For more information, please visit www.dundeereit.com.
FOOTNOTES
###PRECONTENT4###
Non-IFRS supplemental measures
NOI, FFO and AFFO are key measures of performance used by real estate operating companies; however, they are not defined by International Financial Reporting Standards ("IFRS"), do not have standard meanings and may not be comparable with other industries or income trusts.
Forward looking information
This press release may contain forward-looking information within the meaning of applicable securities legislation. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Dundee REIT's control, which could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These risks and uncertainties include, but are not limited to, general and local economic and business conditions; the financial condition of tenants; our ability to refinance maturing debt; leasing risks, including those associated with the ability to lease vacant space; and interest and currency rate functions. Our objectives and forward-looking statements are based on certain assumptions, including that the general economy remains stable, interest rates remain stable, conditions within the real estate market remain consistent, competition for acquisitions remains consistent with the current climate and that the capital markets continue to provide ready access to equity and/or debt. All forward-looking information in this press release speaks as of the date of this press release. Dundee REIT does not undertake to update any such forward-looking information whether as a result of new information, future events or otherwise. Additional information about these assumptions and risks and uncertainties is contained in Dundee REIT's filings with securities regulators, including its latest annual information form and MD&A. These filings are also available at Dundee REIT's website at www.dundeereit.com.
Contacts:
Dundee REIT
Michael J. Cooper
Vice Chairman and Chief Executive Officer
(416) 365-5145
mcooper@dundeereit.com :
Dundee REIT
Mario Barrafato
Senior Vice-President and Chief Financial Officer
(416) 365-4132
mbarrafato@dundeereit.com :
www.dundeereit.com
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