Effective November 3, 2010, the name of Charter Real Estate Investment Trust was changed to Partners Real Estate Investment Trust. All references to “Partners Real Estate Investment Trust”, “Partners REIT”, the “REIT” and similar references in this press release refer to Charter Real Estate Investment Trust prior to the name change. VICTORIA, BRITISH COLUMBIA–(Marketwire – March 10, 2011) – Partners Real Estate Investment Trust (TSX VENTURE:PAR.UN) announced today results for the three months and year ended December 31, 2010.
Occupancy levels as at December 31, 2010 were higher at 95.7% compared to 95.2% at the end of the third quarter of 2010 and 95.1% at the end of last year. The movement in leasing and renewals in the fourth quarter and year ended December 31, 2010 offset lease expiries during the period. Management continues to focus on pursuing and closing new leases and renewals. Overall occupancy was also positively impacted by the acquisition of Wellington Southdale Plaza on December 22, 2010 with occupancy of 97.2%.
Net Operating Income (“NOI”) increased to $2.7 million in the fourth quarter of 2010 from $2.5 million in the same prior-year period due primarily to a 31% increase at the REIT’s Chateauguay property. For the year ended December 31, 2010 NOI declined to $10.0 million from $10.7 million in 2009 due to decreases at the REIT’s Mega Centre, Cornwall Square and Place Val Est properties.
Funds from Operations (“FFO”) in 2010 include non-recurring other transaction costs consisting of non-capital expenses resulting from a strategic review process that occurred in the second quarter of the year, as well as expenses incurred on property acquisitions no longer pursued in the fourth quarter. FFO excluding non-recurring other transaction costs were $0.9 million ($0.04 per unit) in the fourth quarter of 2010, consistent with the fourth quarter of the prior year. FFO excluding non-recurring other transaction costs in 2010 was $3.4 million ($0.16 per unit) compared to $4.2 million ($0.23 per unit) last year. The decline is due primarily to a $170,000 decrease in revenue from the property portfolio, a $528,000 increase in operating costs, and a $211,000 increase in interest expense. The change in per unit amounts is due to the significant 40% and 18% increase in the weighted average number of units outstanding in the fourth quarter and year ended December 31, 2010 respectively. .
“We were pleased with our performance in the fourth quarter as we continued to make solid progress with our leasing and renewal activities,” commented Adam Gant, Chief Executive Officer. “Looking ahead, we expect to see occupancies continue to improve while our active acquisition program adds to our cash flows and strengthens our portfolio.” .
The average occupancy rate for the portfolio was 95.7% at December 31, 2010 compared with 95.1% at December 31, 2009 and 95.2% at September 30, 2010. The improved occupancy over the previous quarter was mainly due to the acquisition of Wellington Southdale Plaza as well as a new short-term tenant at Chateauguay. .
The REIT also acquired a second mortgage on the property in the amount of $2.3 million maturing in 2016 bearing an interest rate of 4.57%. The amortization period of the loan from the date of acquisition (December 22, 2010) was 25 years. In addition, the REIT acquired a first mortgage loan in December 2010 in the amount of $25.5 million secured by a mortgage on the Cornwall property. The loan matures in 2015, has a 25 year amortization period, and bears an interest rate of 4.90%. In December 2010 the REIT assumed a first mortgage loan in the amount of $9.7 million on the acquisition of Wellington Southdale Plaza. The loan matures in 2016 and bears an interest at a rate of 6.0%. The amortization period of the loan from the date of acquisition was 18.9 years.
The centre consists of five separate structures anchored by Empire Theatres and includes such strong national tenants as Dollarama, Moxie’s Grill, 2001 Audio Video, Harvey’s, Jones New York, Dairy Queen and Pizza Pizza. The purchase price of approximately $20.3 million was satisfied by cash and the assumption of an existing mortgage of approximately $9.7 million, maturing in July 2016, with an effective interest rate of 4.4%. On December 22, 2010 the REIT completed the acquisition of the Wellington Southdale Plaza located in London, Ontario, an 87,000 square foot open format, single-storey neighbourhood retail plaza situated on 6.97 acres of land in the heart of London’s Wellington Road retail node. The centre has undergone extensive renovations in 2000, 2004 and 2006, and generates annual NOI of approximately $1.6 million.
The Passcode for the Instant Replay is 541967#. The Instant Replay will be available until midnight, March 22, 2011. The telephone numbers to listen to the call after it is completed (Instant Replay) are local (416) 915-1035 or North American toll free (866) 245-6755. The call will also be archived on the REIT’s website at www.partnersreit.com.
Partners REIT focuses on expanding and managing a portfolio of retail and mixed-use community and neighbourhood shopping centres located in both primary and secondary markets across Canada. Partners REIT is a growth-oriented real estate investment trust, which currently owns (directly or indirectly) eleven retail properties located in Ontario and Quebec, aggregating approximately 1.2 million square feet of leaseable space.
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