Killam Apartment REIT T.KMP.UN

Alternate Symbol(s): KMMPF

Real Estate REIT - Residential

Killam Apartment Real Estate Investment Trust (Trust) is a Canada-based residential real estate investment trust. The Trust owns, operates, and develops a $5.3 billion portfolio of apartments and manufactured home communities (MCHs). Its segments include Apartment, MHC, and Commercial. Its Apartment segment acquires, operates, manages and develops multifamily residential properties across Canada. Its MHC segment acquires and operates MHC communities in Ontario and Eastern Canada. Its Commercial segment acquires and operates stand-alone commercial properties in Ontario, Nova Scotia and Prince Edward Island. Its apartment portfolio consists of over 18,801 units, including 1,343 units jointly owned with institutional partners. It owns over 5,975 sites in 40 MHCs, also known as land-lease communities or trailer parks, in Ontario and Atlantic Canada. It owns the land and infrastructure supporting these communities and leases sites to tenants who own their own homes and pay Killam site rent.

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Killam Apartment REIT

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Post by retiredcfon May 08, 2024 8:12am

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Post# 36028424

RBC

May 7, 2024

Killam Apartment REIT
Q1 Ahead; 2024 SP NOI guidance increased

TSX: KMP.UN | CAD 16.95 | Outperform | Price Target CAD 23.50

Sentiment: Positive

First Look: Killam Apartment REIT (“KMP”) reported FFO/unit of $0.26, +4% y/y, vs. RBC/consensus of $0.25/$0.26. The 4% positive variance was due to higher NOI (slightly higher revenue and lower opex). The strong operating trends continued in Q1 and with SP NOI at +10%, KMP revised upward its 2024 SP NOI target/guide to 8%+ from 6%+. Both leverage and reported NAV improved q/q. Overall, a positive result.

Key points:

SP NOI growth: +10.3 % (SP-Rev +5.9%; SP-Exp -0.7%). Lower opex were driven by lower natural gas prices (-10%) offset by slightly higher general opex and property taxes.
Apartment SP-Occupancy: 98.2% (-30 q/q, -10 bps y/y); SP Apartment rent +5.8% y/y
Rent growth on turnover: +19.6% vs. +19.8% in Q4/23, Q3/23 +16.8%, Q2/23 +14.7%, +Q1/23 +14%. Renewal spread was 3.7% for a blended spread of +5.4%. 3.8% of units turned in the quarter. KMP expects turnover to stay above 17% and average rent to trend higher through remainder of 2024.
Portfolio MTM opportunity: 25-30%
2024 SP NOI growth target/guide increased to 8%+ from 6%+.
Asset sales: Sold, post quarter, 84-unit apartment in Guelph for $19.2M ($229K/unit).
Leverage: Debt to assets of 42.1% (-80 bps q/q). Net debt to EBITDA 10.2x (-0.1x q/q, -0.9x y/y).
IFRS BV (pre-tax) $24.18 (+4.4% q/q). Cap rate for its apartment and MHC portfolio were 4.62% (+0bps q/q) and 6.04% (+0 bps q/q).