Post by
incomedreamer11 on Aug 12, 2021 6:17pm
TD comments
SmartCentres REIT (SRU.UN-T) C$30.47 Q2/21 First Look: FFO Slight Beat; Occupancy Edges Higher Sam Damiani, CFA Nick With-Seidelin, (Associate)
Impact: SLIGHTLY POSITIVE
Results vs Estimate: SmartCentres' Q2/21 results were slightly ahead of our forecast, with diluted FFO/unit of $0.583 (+29% y/y) compared with our $0.555 estimate. Excluding contribution from the Transit City 3 condo closings (70% of which occurred in Q2/21 vs. our 50% estimate) of $0.075, remaining FFO/unit of $0.508 was $0.02 ahead of our estimate. We attribute that remaining beat to slightly higher occupancy (97.1% vs. our 96.7% estimate) and nearly 150,000sf of redevelopment and development space that came online (93%-leased; discussed below). Bad debt expense (BDE) of $2.3mm (unchanged q/q, -$13mm y/y) largely met our forecast.
Operations: In-place occupancy was +10bps q/q (and -50bps y/y) to 97.1%.
Renewal uplift continued its nominal trend from last quarter at +0.6% (-2.4% excluding anchors) vs. the +3% pre-pandemic average.
SPNOI growth was +9.6% y/y, rebounding from -4.8% in Q1/21 due to peak BDE occurring in the year-ago quarter. SPNOI growth, excluding BDE, remained negative at -2.0%, but improved sequentially from -3.7% in Q1/21
. Q2 rent collections averaged 94.8% (vs. 94.1% Q1/21 initially reported and subsequently increased to 95.4%).
Development/Intensification Projects Update: At the VMC, 70% of Transit City 3 condos (631 units) closed with all remaining units having closed post-Q2.
Redevelopment and development space coming online totaled 147,000sf, of which 93% was leased. The three largest tenants (Memon Supermarket, Krazy Bins, and Buropro Citation) are replacements within spaces formerly occupied by Sobeys, Home Outfitters, and Best Buy.
The Phase 1 residential rental project in Laval, QC (171 suites) remains 90%- leased (unchanged q/q) following first occupancies in Q2/20.
Balance Sheet: IFRS fair value changes were minimal (+$13mm). The average portfolio terminal cap rate (5.94%) and discount rate (6.46%) were both unchanged q/q.
Debt/Assets was 44.6% (-10bps), while Debt/EBITDA declined to 8.2x (-0.4x q/q). Total available liquidity decreased to $0.8bln from $1.1bln q/q due to debt repayment. Unencumbered assets were steady at $5.9bln
Comment by
CANCDN on Aug 12, 2021 7:28pm
and SRU lease rates are essentially the same they have been at least as far back as 2015. Same property NOI is unchanged abd negative over many years. The cash flow from operations doesn't cover the distributions. no one else finds it odd they removed the FFO payout ratios and instead uses AFFO to add non operational income?
Comment by
incomedreamer11 on Aug 12, 2021 10:22pm
Unfortunately, SRU depends from Wall Mart and Goldhar,no choice