Bullboard - Stock Discussion Forum Canadian Apartment Properties Real Estate Investment Trust T.CAR.UN

Alternate Symbol(s): CDPYF

Canadian Apartment Properties Real Estate Investment Trust is a Canada-based provider of rental housing. The Company owns and manages interests in multiunit residential rental properties, including apartments, townhomes and manufactured home communities (MHC), principally located in and near urban centers across Canada. The Company owns approximately 64,300 residential apartment suites, town... see more

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TSX:CAR.UN - Post Discussion

Canadian Apartment Properties Real Estate Investment Trust > TD

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Post by retiredcf on Aug 12, 2020 8:55am

TD

Maintain their $59.00 target. GLTA

Canadian Apartment Properties REIT

(CAR.UN-T) C$49.07

Q2 First Look: Results Miss Slightly; NOI in Line; SPNOI +2.6%

Event

Q2/20 results

Impact: NEUTRAL

Q2/20 NFFO/unit (f.d.) was $0.553, +3% versus Q2/20, but below our $0.576 estimate. Consensus was $0.57. AFFO/unit (our calculation) of $0.475 was also lower than our $0.498 estimate. NOI was directly in line. The negative variance versus our estimate was largely attributed to lower-than-expected investment income and income from IRES (equity accounted).

Rent Collections. June collections were ~98% for the residential and MHC portfolios, and ~97% including commercial and ancillary income. Currently less than 0.5% of tenants are on deferral programs. With economies reopening, CAPREIT has reintroduced rent increases (suspended during Q2). Bad debts increased to $2.4mm (1.1% of revenue) from $0.6mm (0.3% of revenues) in Q2/19. We expect an NOI tailwind once the moratorium on evictions is lifted.

A conference call will be held at 10:00 a.m. ET today (1-833-714-0874; passcode: 2696403).

Operating Highlights

Residential Suite SPNOI growth was +2.6% (YTD: +4.1%), as a 3.3% increase in revenues was partially offset by a 4.6% increase in operating costs. SPNOI margins were -50bps y/y to 64.9% as most regions reported higher bad debts and R&M costs. Ontario (52% of SPNOI) was +2.6%, Quebec (18%) was +5.2%, B.C. (13%) was +3.4%, and Alberta was -4.5%. MHC SPNOI was +2.6% (YTD: +4.5%).
Residential Suite same-property occupancy was +10bps y/y at 98.9%. Net AMR increased 4.1% y/y to $1,291 due to gains on turns in Ontario, B.C., and Nova Scotia.
Canadian Portfolio generated +7.9% AMR growth on suite turnover (4.0% of suites) on strength in Ontario, Nova Scotia, and Quebec.

Acquisition/Disposition/Development Activity

Completed the purchase of eight operating leases for $131.2mm (link).
Post-Q2 disposed of a 188-unit Calgary townhome property for $30.5mm (~

$162,235/unit)
The REIT lowered the number of development projects to nine totaling 6,988 potential suites, from 14 totaling 7,790 potential suites, owing to the pandemic.

Balance Sheet

CAPREIT had $338.2mm of liquidity ($213.5mm cash; $124.8mm available on credit lines), up from ~$255mm at Q1/20. The REIT has unencumbered assets valued at $773mm.
Leverage (Debt/GBV) was +20bps q/q to 36.3%. Completed $165.4mm of refinancings at a WAIR of 1.98%.

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