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KILLAMAPARTMENTREIT
Q1 2016ResultsConferenceCall
May 11, 20162 pm EST
Cautionary StatementThis presentation may contain forward looking statements with respect to KillamApartment REIT and its operations, strategy, financial performance and condition.These statements generally can be identified by use of forward looking words such as“may”, ”will”, “expect”, “estimate”, “anticipate”, “intends”, “believe” or “continue” orthe negative thereof or similar variations. The actual results and performance ofKillam Apartment REIT discussed herein could differ materially from those expressedor implied by such statements. Such statements are qualified in their entirety by theinherent risks and uncertainties surrounding future expectations. Important factorsthat could cause actual results to differ materially from expectations include, amongother things, general economic and market factors, competition, changes ingovernment regulation and the factors described under “Risk Factors” in Killam'annual information form and other securities regulatory filings. The cautionarystatements qualify all forward looking statements attributable to Killam ApartmentREIT and persons acting on its behalf. Unless otherwise stated, all forward lookingstatements speak only as of the date to which this presentation refers, and the partieshave no obligation to update such statements.
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• Generated FFO per unit of $0.18, a 20.0% increase from $0.15 in Q1-2015.
• AFFO payout ratio over last twelve months improved to 82%.
• Increased same property rental revenue by 1.5%.
• Achieved same property NOI growth of 8.0%.
• Continued interest rate savings on refinancing, reducing the weighted average interest rate on mortgage debt to 3.23%, from 3.27% at December 31, 2015.
Highlights from Q4-2015Highlights from Q1 2016
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Strong Customer Service
HighlightsfromKillam’s2015TenantSurvey
92%satisfied with their
apartment
90%satisfied with Killam
86%would recommendKillam to a friend or
family member
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9.7% FFO Per Share Growth 2015
$0.12
$0.15
$0.18
$0.10
$0.12
$0.16
Q1-2013 Q1-2014 Q1-2015
Q1 FFO & AFFO Per UnitFFO AFFO
20% FFO Per Unit Growth
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$0.57 $0.58 $0.58 $0.60 $0.60 $0.60
99%96% 96%
98%
88%
82%
70%
75%
80%
85%
90%
95%
100%
$0.56$0.56$0.57$0.57$0.58$0.58$0.59$0.59$0.60$0.60$0.61
AFFO Payout Ratio
Dividend AFFO Payout Ratio
88% AFFO Payout Ratio in 2015Improving Payout Ratio
82%AFFO
PayoutRatio
* Rolling 12 months
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8.0% Same Property NOI Growth
1.4%2.4%
1.5%
(6.1%)
0.3%
(5.6%)
8.4%
4.1%
8.0%
Same Property Results3 months ended March 31, 2016
Revenue Expenses NOI
Apartments MHCs Consolidated
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Strongest NOI Growth Since 2010
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-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Q1 2012
Q2 2012
Q3 2012
Q4 2012
Q1 2013
Q2 2013
Q3 2013
Q4 2013
Q1 2014
Q2 2014
Q3 2014
Q4 2014
Q1 2015
Q2 2015
Q3 2015
Q4 2015
Q1 2016
Quarterly Change in Same Property NOI2012-2016
Averagequarterly NOI growth of 1.7% from 2012-2016.
Apartment Occupancy of 95.7% in Q1
95.2% 94.0% 94.2% 93.4%97.0% 97.0% 97.6% 98.1% 97.9%
95.5%
96.3%93.6% 95.1% 93.3%
96.0% 97.8% 97.3%
80.6%
96.9% 95.7%
Q1 Apartment Occupancy*Q1 2015 Q1 2016
(1) Killam has a 50% interest in one 307-unit asset in Calgary, acquired in December 2014.
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* Occupancy represents actual residential rental revenue net of vacancy as a percentage of gross potential residential rent fromstabilized properties.
Incentives Equal 0.75% of Potential Rents
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
Incentives as a Percentage of Rental RevenueSame Apartment Portfolio
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$0$2$4$6$8
$10$12$14$16$18$20
$ pe
r GJ
Commodity Charge per GJNova Scotia New Brunswick
Lower Natural Gas Prices in 2015 Vs. 2014Lower Natural Gas Prices in NB
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4.11%3.43% 3.64%
2.81% 2.56%3.10% 3.16% 3.30% 3.24%
0%
1%
2%
3%
4%
5%
6%
7%
8%
$0$20$40$60$80
$100$120$140$160$180$200
Inte
rest
Rat
e
Mor
tgag
e M
atur
ities
($M
)
Apartment Mortgage Maturities by YearMortgage Maturities by Year Weighted Average Interest Rate
5 year rate 10 year rate
Interest Expense Savings on Refinancings
Current rate for 5-year CMHC insured debt is approximately 1.7%.
Current rate for 10-year CMHC insured debt is approximately 2.4%. 12
Building Description: 142 units - 70 rental, 72 condoOwnership:Killam 50%, Urban Capital 50% Start Date: December 2014Projected Completion:Q3-2016Location:Downtown HalifaxConstruction Cost: $14.7 million, $210,000/door (Killam’s cost)Expected Yield: 5.5%Expected Value: 4.75% cap rate
Current Developments
Southport, Halifax, NSSouthport, Halifax
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Current Developments
Southport, Halifax, NSSouthport, Halifax
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Current Developments
Southport, Halifax, NSSouthport, Halifax
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Current Developments
Southport, Halifax, NSSouthport, Halifax
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The Alexander, HalifaxBuilding Description: 242 units24 storeys230 underground parking stalls6,200 square feet of retail spaceOwnership:Killam 50%, Partners 50% Start Date: Q3-2015Projected Completion:2017Location:Downtown Halifax across from the waterfrontConstruction Cost: $35 million, $276,000/ residential door (Killam’s cost)Expected Yield: 5.5%Expected Value: 4.75% cap rate
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The Alexander, Halifax
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Future DevelopmentsSaginaw 2, Cambridge, ON
Building Description: 93 units, 7 storeys
Start Date: Q3-2016Projected Completion:Q1-2018Location:Cambridge, ON
Saginaw 2, Cambridge
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Garden Park Apartments, HalifaxBuilding Description: 246 apartment units8,195 sq. ft. commercialLocation:1472 Martello Street, Halifax2016 Acquisition:51.0%$23.7 millionPrevious Purchases of Ownership Interest:2005 - 10.7% 2006 - 6.6% 2009 - 13.3% 2010 - 15.0% 2011 - 1.7% 2014 - 1.7%
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Kanata Lakes Apartments, OttawaBuilding Description: 173 units3rd of a five-building portfolio with a shared clubhouseLocation:1047 Canadian Shield Ave, Kanata
Previous Purchases:2011 – 25% of building I2014 – 50% of building II &additional 25% of building I2016 – 50% of building III
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Kanata Lakes Apartments, Ottawa
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KILLAMAPARTMENTREIT
Q1 2016ResultsConferenceCall
May 11, 20162 pm EST