TORONTO, ONTARIO — (Marketwire) — 08/03/11 — 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 posted strong financial results for the quarter ended June 30, 2011, evidencing the success of the Trusts acquisition strategy and the strength of its operations.
HIGHLIGHTS
“Once again, we delivered solid performance in the second quarter. The real excitement, however, came after quarter-end with the announcement of the Blackstone portfolio acquisition and the closing of the 1.0 million square foot office property in downtown Montreal” said Michael Cooper, Chief Executive Officer. “With the highly accretive acquisitions completed to-date, a low cost of debt and more efficient cash management, we are positioned to deliver compelling growth over the next couple of years,” added Mr. Cooper.
FINANCIAL HIGHLIGHTS
ACQUISITION HIGHLIGHTS
During the first six months of the year, Dundee REIT has completed $516.7 million of acquisitions, including $42.0 million in Q2. Subsequent to quarter end the REIT acquired 700 de la Gauchetiere, a 28-storey, 1.0 million square foot Class A office building located in the heart of downtown Montreal and 13888 Wireless Way in Burnaby, BC. In addition, $756.1 million of properties have been secured under contract, comprising 3.0 million square feet of office buildings primarily located in downtown core markets.
“Since the fall of 2009 we-ve completed, or placed under contract, $2.6 billion of acquisitions, all of which make Dundee REIT a stronger investment today and into the future. We will continue to pursue opportunities as they arise and, in the meantime, will focus on operations, asset management and repositioning our portfolio as necessary,” said Michael Cooper.
OPERATIONAL HIGHLIGHTS
Portfolio occupancy rises to 96.5% – the overall percentage of occupied and committed space remained high at 96.5% (March 31, 2011 – 96.1%; June 30, 2010 – 96.6%). On a comparative property basis, occupancy is up nearly 1.5% quarter-over-quarter. In-place rents remain approximately 6% below existing market rents, providing an opportunity to capture increases through leasing activity. Average in-place rents were $14.37 per square foot up from $14.29 per square foot at December 31, 2010 and down slightly from $15.43 at June 30, 2010. Throughout the remainder of 2011, approximately 1.1 million square feet of space will expire, of which 513,000 square feet or 46% has been committed.
CAPITAL INITIATIVES
SUBSEQUENT EVENTS
Dundee REIT-s portfolio has undergone a significant transformation in the last year and a half. With the activity undertaking since quarter-end, the portfolio has continued to evolve with a greater emphasis on central business district office properties. The acquisition of 700 de la Gauchetiere, a 28-storey, 1.0 million square foot Class A office building located in the heart of downtown Montreal, has strengthened the REITs position in this market and utilized the cash carried on its balance sheet at quarter end. The portfolio of 24 office properties the Trust has agreed to acquire from affiliates of Blackstone Real Estate Advisors LP (“Blackstone”) and Slate Properties Inc. (“Slate”) will add 2.7 million square feet to its established office portfolios in Toronto, Ottawa, Calgary and Edmonton. The properties are all well-leased downtown office properties, the bulk of which are situated in the heart of Toronto-s vibrant financial district.
On a gross leaseable area percentage basis, the acquisitions have increased Dundee REIT-s weighting in Toronto and Eastern Canada.
Information appearing in this news release is a select summary of results. The financial statements and management-s discussion and analysis for the Trust, as well as its Supplementary Information Package are available at and on .
Dundee REIT is an unincorporated, open-ended real estate investment trust and provides high quality, affordable business premises. It is focused on owning, acquiring, leasing and managing mid-sized urban and suburban office and industrial properties in Canada. Dundee REIT-s portfolio currently consists of approximately 16.1 million square feet of gross leasable area across Canada. Dundee REIT-s portfolio is well diversified by geographic location and tenant mix. For more information, please visit .
FOOTNOTES
NOI, FFO and AFFO are key measures of performance used by real estate operating companies; however, they are not defined by generally accepted accounting principles (GAAP), do not have standard meanings and may not be comparable with other industries or income trusts.
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, that 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 .
Contacts:
Dundee REIT
Michael J. Cooper
Vice Chairman and Chief Executive Officer
(416) 365-5145
Dundee REIT
Mario Barrafato
Senior Vice-President and Chief Financial Officer
(416) 365-4132