TORONTO, Feb. 21, 2019 (GLOBE NEWSWIRE) -- DREAM OFFICE REAL ESTATE INVESTMENT TRUST (D.UN-TSX) or (“Dream Office REIT”, the “Trust” or “we”) today announced its financial results for the three months and year ended December 31, 2018. Management will host a conference call to discuss the results on February 22, 2019 at 10:00 a.m. (ET).
|SELECTED FINANCIAL INFORMATION||Three months ended||Year ended|
|(unaudited)||December 31,||September 30,||December 31,||December 31,||December 31,|
|(In thousands of dollars except per unit amounts)||2018||2018||2017||2018||2017|
|Comparative properties net operating income ("NOI")(1)||36,240||35,306||35,502||142,971||146,073|
|Funds from operations (“FFO”)(1)||25,736||26,688||32,235||115,796||197,869|
|Per unit amounts|
|Net asset value (“NAV”)(1)||$||24.97||$||24.40||$||23.46||$||24.97||$||23.46|
See footnotes at the end
|SELECTED FINANCIAL INFORMATION||As at|
|(unaudited)||December 31,||September 30,||December 31,|
|REIT A Units (in thousands)||59,369||60,037||73,705|
|LP B Units (in thousands)||5,234||5,234||5,234|
|Total units (in thousands)(4)||64,603||65,271||78,939|
|Total portfolio information(5)|
|Number of properties||34||34||42|
|Number of properties under development||2||2||—|
|Number of properties held for future redevelopment||1||1||1|
|Gross leasable area (“GLA”) (in millions of sq. ft.)||7.3||7.3||8.6|
|Investment properties value (in billions)||$||2.8||$||2.7||$||2.9|
See footnotes at the end
“For several years, we have identified 2019 as the substantial conclusion of our transition period so we can focus our attention on managing a portfolio of excellent assets that have its best days ahead,” said Michael J. Cooper, Chief Executive Officer. “Today, we are aspirational on what we can achieve in downtown Toronto to drive long term value creation for Dream Office REIT.”
|KEY FINANCIAL PERFORMANCE METRICS|
|Weighted average face rate of interest on debt (period-end)(6)||4.06%||3.94%||3.90%|
|Interest coverage ratio (times)(1)(7)||2.8||2.8||3.2|
|Net total debt-to-adjusted EBITDAFV (years)(1)||9.0||9.1||7.1|
|Level of debt (net total debt-to-net total assets)(1)||45.0%||46.2%||39.6%|
|Level of debt (net secured debt-to-net total assets)(1)||40.2%||41.4%||30.6%|
|Average term to maturity on debt (years)||3.8||4.0||4.5|
|Available liquidity and unencumbered assets|
|Cash and cash equivalents on hand (in millions)||$||8.8||$||12.3||$||97.0|
|Undrawn demand revolving credit facilities (in millions)||155.1||220.5||396.6|
|Available liquidity (in millions)(1)||$||163.9||$||232.8||$||493.6|
|Unencumbered assets (in millions)(1)||$||140.0||$||140.0||$||299.0|
See footnotes at the end
“We have been optimizing our capital structure and operations to deliver strong NAV per unit growth and further improvements in key financial metrics in 2019,” said Jay Jiang, Chief Financial Officer of Dream Office REIT. “Our capital recycling and investment decisions will also prioritize long term safety and value growth in the business.”
|SELECTED FINANCIAL INFORMATION|
|Occupancy rate - including committed (period-end)||93.0%||94.2%||94.6%|
|Occupancy rate - in-place (period-end)||91.5%||88.3%||89.7%|
|Average in-place and committed net rent per square foot (period-end)||$||20.97||$||20.87||$||20.86|
|Weighted average lease term (years)||5.2||5.0||5.1|
See footnotes at the end
Management will host a conference call to discuss the results tomorrow, February 22, 2019 at 10:00 a.m. (ET). To access the conference call, please dial 1-888-465-5079 in Canada and the United States or 416-216-4169 elsewhere and use passcode 9977 953#. To access the conference call via webcast, please go to Dream Office REIT’s website at www.dreamofficereit.ca and click on the link for News & Events, then click on Calendar of Events. A taped replay of the conference call and the webcast will be archived for 90 days.
Information appearing in this news release is a select summary of results. The consolidated financial statements and Management’s Discussion and Analysis (“MD&A”) of the Trust are available at www.dreamofficereit.ca and on www.sedar.com.
Dream Office REIT is an unincorporated, open-ended real estate investment trust. Dream Office REIT owns well-located, high-quality central business district office properties in major urban centres across Canada, with a focus on downtown Toronto. For more information, please visit our website at www.dreamofficereit.ca.
(1) Comparative properties NOI, FFO, diluted FFO per unit, NAV per unit, interest coverage ratio, net total debt-to-adjusted EBITDAFV, level of debt (net total debt-to-net total assets), level of debt (net secured debt-to-net total assets), available liquidity, and unencumbered assets are non-GAAP measures used by Management in evaluating operating and financial performance. Please refer to the cautionary statements under the heading “Non-GAAP Measures” in this press release.
(2) A description of the determination of diluted amounts per unit can be found in section "Our Equity" under the heading “Weighted average number of units” of the MD&A.
(3) Effective with the July 2017 distribution, the Trust revised its monthly distribution to $0.08333 per unit, or $1.00 on an annualized basis.
(4) Total units includes 5.2 million LP B Units which are classified as a liability under IFRS.
(5) Excludes properties held for sale at the end of each period.
(6) Weighted average face rate of interest on debt is calculated as the weighted average face rate of all interest bearing debt on balance.
(7) Interest coverage ratio has been restated in the December 31, 2017 comparative period to conform to current period presentation. For further details, please refer to the “Non-GAAP Measures and Other Disclosures” section under the heading “Interest coverage ratio” in Dream Office REIT’s MD&A for the three months and year ended December 31, 2018.
(8) Comparative portfolio excludes properties sold, held for future redevelopment and properties under development as at December 31, 2018.
The Trust’s consolidated financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”). In this press release, as a complement to results provided in accordance with IFRS, the Trust discloses and discusses certain non-GAAP financial measures, including comparative properties NOI, FFO, diluted FFO per unit, NAV per unit, interest coverage ratio, net total debt-to-adjusted EBITDAFV, level of debt (net total debt-to-net total assets), level of debt (net secured debt-to-net total assets), available liquidity, unencumbered assets, as well as other measures discussed elsewhere in this release. These non-GAAP measures are not defined by IFRS, do not have a standardized meaning and may not be comparable with similar measures presented by other income trusts. The Trust has presented such non-GAAP measures as Management believes they are relevant measures of the Trust’s underlying operating performance and debt management. Non-GAAP measures should not be considered as alternatives to net income, net rental income, cash flows generated from (utilized in) operating activities, cash and cash equivalents, total assets, non-current debt, total equity, or comparable metrics determined in accordance with IFRS as indicators of the Trust’s performance, liquidity, cash flow, and profitability. For a full description of these measures and, where applicable, a reconciliation to the most directly comparable measure calculated in accordance with IFRS, please refer to the “Non-GAAP Measures and Other Disclosures” in Dream Office REIT’s MD&A for the three months and year ended December 31, 2018.
FORWARD LOOKING INFORMATION
This press release may contain forward-looking information within the meaning of applicable securities legislation, including statements regarding our objectives and strategies to achieve those objectives, future asset sales and use of proceeds from asset sales, our expected future operating cash flows, the future composition of our portfolio, future development plans, our expected cost to complete development activities, our expected income and yield from properties under development, our expected liquidity and leverage, the terms of and duration of secured tenant renewals, anticipated market rents, the volatility of our operating performance through 2019, our capital allocation strategy, and the future strength of our balance sheet. 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 Dream Office 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 fluctuations. 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. Dream Office REIT does not undertake to update any such forward-looking information whether as a result of new information, future events or otherwise except as required by law. Additional information about these assumptions and risks and uncertainties is contained in Dream Office REIT’s filings with securities regulators, including its latest annual information form and MD&A. These filings are also available at Dream Office REIT’s website at www.dreamofficereit.ca.
For further information, please contact:
|Michael J. Cooper||Jay Jiang|
|Chairman and Chief Executive Officer||Chief Financial Officer|