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"We are very pleased with the high quality of the properties being acquired and the contribution that they will make to our business going forward," said Randy Cameron, President and CEO, Dundee Industrial REIT. "In addition to providing cash flow growth, increased scale allows us to better meet the changing needs of our tenants and to also better manage geographic and tenant exposure," said Mr. Cameron.
FINANCIAL HIGHLIGHTS
-- First full quarter of operations and financial results are in-line with expectations - Q1 2013 was the Trust's first full quarter of operations and also reflects a full quarter of results for all of the properties acquired in Q4 2012. AFFO for the quarter was $9.3 million or $0.17 per unit, representing an increase of $2.8 million or 42.9% over the prior operating period (October 4, 2012 to December 31, 2012) and no change on a per unit basis over the prior period. The increase in AFFO is largely due to a full quarter of earnings from the KingSett Portfolio, acquired on December 19, 2012, as well as a full quarter of earnings for the Initial Properties, acquired on October 4, 2012. Per unit results were flat over the prior period; however Q1 results included approximately $0.01 per unit of temporary dilution relating to delayed deployment of the proceeds from the March 6, 2013 equity offering.-- Q1 2013 FFO was $12.0 million or $0.22 per unit, representing an increase of $3.5 million or 41.9% over the prior period and no change on a per unit basis over the prior period. For the reasons noted above, FFO increased largely due to the timing of acquisitions, and on a per unit basis was partially diluted from cash related to the equity offering which was not deployed in the quarter.-- Q1 2013 NOI was $19.9 million, representing an increase of $7.4 million or 58.7% over the prior period due mainly to the timing of the KingSett Portfolio acquisition in Q4 2012.
OPERATIONAL HIGHLIGHTS
-- Portfolio occupancy remains ahead of national industry average - At March 31, 2013, the overall percentage of occupied and committed space across the Trust's portfolio was strong at 96.5%, well above the national industry average of 94.2%.-- Leasing Profile - Leasing activity during the first quarter included approximately 101,100 square feet of new leases and approximately 240,400 square feet of renewals, more than offsetting approximately 316,700 square feet of expiries and early terminations. At period-end, the Trust had approximately 486,700 square feet of vacant space, of which 92,000 square feet is committed for future occupancy. The average remaining lease term at March 31, 2013 is 5.1 years.-- Average in-place rents 6% below market rents - At quarter-end, the portfolio average in-place rent was $7.18 per square foot (December 31, 2012 - $7.12), approximately 6% below estimated market rents. GLA Occupancy Average Average in- Estimated (sq. ft.) (%) lease term place rent market rent (years) (per sq. ft.) (per sq. ft.)----------------------------------------------------------------------------Western Canada 4,121,299 96.4 3.85 $ 8.46 $ 9.44Central Canada 5,121,917 97.3 6.75 6.29 6.22Eastern Canada 2,191,202 95.0 3.55 6.85 7.25----------------------------------------------------------------------------Total 11,434,418 96.5 5.10 $ 7.18 $ 7.58------------------------------------------------------------------------------ Bench strength continues to grow - Dedicated team members continue to be added across the company with key leadership roles being filled in both Eastern and Western Canada. The Trust has hired Joe Iadeluca as Senior Vice President, Eastern Canada. Joe has more than 25 years of experience in commercial real estate and is based in Montreal. Prior to joining Dundee, Joe spent six years at GE Real Estate. Between 1998 and 2007, Joe held a similar leadership position with Dundee REIT, until his employment was transferred to GE Real Estate as part of a portfolio sale. The Trust has also hired Yanick Frappier as Vice President, Western Canada. Yanick has 15 years of experience in commercial real estate. Prior to joining Dundee, he worked for SITQ/Ivanhoe Cambridge. Also in place are dedicated leasing teams for both the Eastern and Western Canada portfolios.
