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CALGARY, Alberta, March 15, 2022 (GLOBE NEWSWIRE) — Northview Fund (�Northview or the Fund, formerly known as Northview Canadian High Yield Residential Fund) (NHF.UN TSX), today announced financial results for the three months and year ended December 31, 2021. The comparative information included for the period ended December 31, 2020 reflects results for the period from November 2, 2020, the date on which Northview began operations, to December 31, 2020. While comparative information is presented on a quarterly and annual basis, the operating periods in the period ended December 31, 2020 and the year ended December 31, 2021 cover different time frames and, as such, are not comparable.
All amounts in this news release are in thousands of Canadian dollars unless otherwise indicated.
We are excited to report our first full year of operating results as Northview Fund, commented Mr. Todd Cook, Chief Executive Officer of Northview. Over the past year, we have generated stable income to support sustainable cash distributions of $45.2 million with an FFO payout ratio of 69.1% to our Unitholders, focused on operational effectiveness, and achieved a 150 basis point improvement in occupancy for the multi-residential portfolio. We are well-positioned to take advantage of portfolio opportunities as they arise in 2022. | |
HIGHLIGHTS
1 Non-GAAP financial measure or non-GAAP ratio. See Non-GAAP and Other Financial Measures section of this news release
2 See Non-GAAP and Other Financial Measures section of this news release
COVID-19 IMPACT
On March 11, 2020, the World Health Organization declared COVID-19 a global pandemic. Since then, the spread of COVID-19 has had a substantial impact on the Canadian and global economy.
Throughout 2021, significant progress was made on widespread vaccination efforts across Canada, with vaccinations now available to individuals aged 5 years and older. In addition, certain jurisdictions implemented vaccination requirements in 2021 to allow businesses to continue to operate, and a gradual easing of restrictions supported improved employment rates throughout the second half of 2021. In the fourth quarter of 2021, the emergence of new variants of COVID-19 posed challenges and supported the re-introduction of social distancing actions, proving the impact of COVID-19 continues to be unpredictable. As jurisdictions continue to respond to the threat of the COVID-19 pandemic, the uncertainty from the pandemic is expected to continue in 2022.
Notwithstanding the impacts of the COVID-19 pandemic, the long-term fundamentals for Canadian multi-residential markets remain compelling and Northviews portfolio is in several diversified geographies. The demand for rental accommodation remains strong due to home ownership affordability continuing to be a challenge in many markets, and collection rates in Northview’s multi-residential portfolio have remained stable. Due to the long-term tenure of commercial leases, supported primarily by government tenants and credit-rated corporations, there has been a minimal impact of COVID-19 on rent collections in Northviews commercial portfolio. Execusuite occupancy has shown improvements in 2021 following the easing of interterritorial travel restrictions.
One of Northviews top priorities continues to be supporting the safety and well-being of residents, tenants, execusuite guests, employees, and other stakeholders by managing and controlling the spread of COVID-19. While physical distancing restrictions have impacted certain non-essential maintenance activities, Northview has been able to maintain a level of essential service for its buildings, tenants, and execusuite guests.
FINANCIAL CONDITIONS AND OPERATING RESULTS
(thousands of dollars, except as indicated) | As at December 31, 2021 | As at December 31, 2020 | |||
Total assets | 1,853,096 | 1,882,582 | |||
Total liabilities, excluding net assets attributable to Unitholders | 1,357,746 | 1,365,476 | |||
Total liabilities, net assets attributable to Unitholders | 1,852,184 | 1,881,278 | |||
Total non-current liabilities, excluding net assets attributable to Unitholders | 570,239 | 1,164,992 | |||
Mortgages payable | 808,842 | 847,845 | |||
Debt to gross book value3 | 67.8% | 66.7% | |||
Interest coverage ratio (times)3,4 | 2.84 | 2.60 | |||
Debt service coverage ratio (times)3,4 | 1.54 | 1.39 | |||
Weighted average mortgage interest rate | 2.87% | 2.87% | |||
Weighted average term to maturity (years) | 2.7 | 3.6 | |||
Weighted average capitalization rate | 7.44% | 7.56% | |||
Multi-residential occupancy3 | 90.2% | 88.7% | |||
AMR ($)3 | 1,272 | 1,276 | |||
Number of multi-residential suites | 11,121 | 11,121 | |||
Number of execusuites | 200 | 200 | |||
Commercial sq. ft. | 1,131,730 | 1,131,730 | |||
Number of Units outstanding (000s)3 | 35,917 | 35,917 |
(thousands of dollars, except as indicated) | Year Ended December 31, 2021 | Period Ended December 31, 20204 | |||
Revenue | 192,125 | 31,059 | |||
NOI | 112,669 | 17,462 | |||
NOI margin | 58.6% | 56.2% | |||
Cash flow provided by operating activities | 57,531 | (11,804 | ) | ||
Distributions declared to Unitholders | 45,150 | 7,525 | |||
Distributions declared per Unit weighted average ($/Unit) | 0.1091 | 0.1093 | |||
Class A Unit ($/Unit) | 0.1048 | 0.1048 | |||
Class C Unit ($/Unit) | 0.1106 | 0.1106 | |||
Class F Unit ($/Unit) | 0.1081 | 0.1081 | |||
FFO payout ratio5 | 69.1% | 81.6% | |||
AFFO payout ratio5 | 83.3% | 101.2% | |||
Net and comprehensive (loss) income | (21,341) | 90,669 | |||
Net and comprehensive income (loss) per Unit ($/Unit) | (0.59) | 2.52 | |||
FFO5 | 65,386 | 9,219 | |||
FFO per Unit ($/Unit)5 | 1.82 | 0.26 | |||
AFFO5 | 54,190 | 7,436 | |||
AFFO per Unit ($/Unit)5 | 1.51 | 0.21 |
3 See Non-GAAP And Other Financial Measures section of this news release
4 Comparative information calculated for the period from November 2, 2020, the date on which Northview began operations, to December 31, 2020
5 Non-GAAP financial measure or non-GAAP ratio. See Non-GAAP and Other Financial Measures section of this news release
FINANCIAL INFORMATION
Northviews audited consolidated annual financial statements, the notes thereto, and Managements Discussion and Analysis for the year ended December 31, 2021, can be found on Northviews website at www.northviewfund.com or www.sedar.com.
ABOUT NORTHVIEW FUND
Northview is a closed-end fund established pursuant to a declaration of trust under the laws of the Province of Ontario for the primary purpose of indirectly acquiring, owning, and operating a portfolio of income-producing rental properties in secondary markets within Canada.
NON-GAAP AND OTHER FINANCIAL MEASURES
Certain measures in this earnings release do not have any standardized meaning as prescribed by generally accepted accounting principles (GAAP) and may, therefore, be considered non-GAAP financial measures, non-GAAP measures, or other measures and may not be comparable to similar measures presented by other issuers. These measures are provided to enhance the readers overall understanding of our current financial condition and financial performance. They are included to provide investors and management with an alternative method for assessing our operating results in a manner that is focused on the performance of our ongoing operations and to provide a more consistent basis for comparison between periods. These measures include widely accepted measures of performance for Canadian real estate investment trusts; however, the measures are not defined by GAAP. In addition, these measures are subject to the interpretation of definitions by the preparers of financial statements and may not be applied consistently between real estate entities. These measures include:
For information on the most directly comparable GAAP measures, composition of the measures, a description of how Northview uses these measures, and an explanation of how these measures provide useful information to investors, refer to the Non-GAAP and Other Financial Measures section of Northviews management discussion and analysis as at and for the year ended December 31, 2021, available on Northviews profile on SEDAR at www.sedar.com, which is incorporated by reference into this news release.
NON-GAAP RECONCILIATION
The following table reconciles FFO and AFFO from net and comprehensive (loss) income, the most directly comparable GAAP measure as presented in the financial statements:
Three Months Ended December 31 | Year Ended December 31 | |||||||
(thousands of dollars, except where indicated) | 2021 | 20201 | 2021 | 20201 | ||||
Net and comprehensive (loss) income | (18,205) | 90,669 | (21,341) | 90,669 | ||||
Adjustments: | ||||||||
Distributions to Unitholders | 11,287 | 7,525 | 45,150 | 7,525 | ||||
Depreciation | 766 | 566 | 3,067 | 566 | ||||
Fair value loss (gain) on investment properties | 22,392 | (2,798) | 37,776 | (2,798) | ||||
Gain on business combination | | (105,533) | | (105,533) | ||||
Transaction costs | | 18,872 | 866 | 18,872 | ||||
Other2 | (138) | (82) | (132) | (82) | ||||
FFO | 16,102 | 9,219 | 65,386 | 9,219 | ||||
Maintenance capex reserve multi-residential | (2,747) | (1,750) | (10,988) | (1,750) | ||||
Maintenance capex reserve commercial | (52) | (33) | (208) | (33) | ||||
AFFO | 13,303 | 7,436 | 54,190 | 7,436 | ||||
FFO per Unit ($/Unit) | 0.45 | 0.26 | 1.82 | 0.26 | ||||
FFO payout ratio trailing twelve month | 69.1% | 81.6% | 69.1% | 81.6% | ||||
AFFO per Unit ($/Unit) | 0.37 | 0.21 | 1.51 | 0.21 | ||||
AFFO payout ratio trailing twelve months | 83.3% | 101.2% | 83.3% | 101.2% | ||||
Number of Units outstanding (000s) | 35,917 | 35,917 | 35,917 | 35,917 |
1 Comparative information calculated for the period from November 2, 2020, the date on which Northview began operations, to December 31, 2020
2 Other is comprised of non-controlling interest, amortization of other long-term assets, amortization of tenant inducements, gain on disposition of property, plant and equipment, and fair value adjustments for non-controlling interest and equity investments.
CAUTIONARY AND FORWARD-LOOKING INFORMATION
Certain information contained in this news release may constitute forward-looking information within the meaning of applicable securities laws relating to the business and financial outlook of Northview. Statements that reflect Northviews current objectives, plans, goals, and strategies are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed, projected, or implied by such forward-looking information. In some instances, forward-looking information can be identified by the use of terms such as may, should, expect, will, anticipate, believe, intend, estimate, predict, potentially, starting, beginning, begun, moving, continue, or other similar expressions concerning matters that are not historical facts. Forward-looking information in this news release includes, but is not limited to, statements related to the recapitalization event, the effects of the coronavirus (COVID-19) pandemic on Northviews business, future maintenance expenditures, financing and the availability of financing, future economic conditions, liquidity and capital resources, market trends, future operating efficiencies, tenant incentives, and occupancy levels. Such statements involve significant risks and uncertainties and are not meant to provide guarantees of future performance or results. These cautionary statements qualify all of the statements and information contained in this news release incorporating forward-looking information.
Forward-looking information is made as of March 15, 2022 and is based on information available to management as of that date. Management believes that the expectations reflected in forward-looking information is based upon information and reasonable assumptions available at the time they are made; however, management can give no assurance that the actual results will be consistent with this forward-looking information. Factors that could cause actual results, performance, or achievements to differ materially from those expressed or implied by forward-looking information include, but are not limited to, general economic conditions; the COVID-19 pandemic; the availability of a new competitive supply of real estate which may become available through construction; Northviews ability to maintain occupancy and the timely lease or re-lease of multi-residential suites, execusuites, and commercial space at current market rates; tenant defaults; changes in interest rates; Northviews qualification as a real estate investment trust (REIT); changes in operating costs; governmental regulations and taxation; fluctuations in commodity prices; and the availability of financing. Additional risks and uncertainties not presently known to Northview, or those risks and uncertainties that Northview currently believes to be not material, may also adversely affect Northview. Northview cautions readers that this list of factors is not exhaustive and that should certain risks or uncertainties materialize, or should underlying estimates or assumptions prove incorrect, actual events, performance, and results may vary materially from those expected.
Except as specifically required by applicable Canadian law, Northview assumes no obligation to update or revise publicly any forward-looking information to reflect new events or circumstances.
To learn more about Northview, visit www.northviewfund.com or contact:
Todd Cook, Chief Executive Officer Northview Fund | |
Tel: | (403) 531-0720 |
Email: | tcook@northviewfund.com |
Sarah Walker, Chief Financial Officer Northview Fund | |
Tel: | (403) 531-0720 |
Email: | swalker@northviewfund.com |
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