TORONTO, March 15, 2022 /CNW/ - NorthWest Healthcare
Properties Real Estate Investment Trust (the "REIT") (TSX: NWH.UN)
today announced its results for the three and twelve months ended
December 31, 2021.
NorthWest's high quality and defensive $9.2 billion, 197 property portfolio performed
exceptionally well in 2021 and the REIT delivered record financial
results, highlighted by 2.2% and 9.0% AFFO (see Exhibit 2) and NAV
per Unit (Exhibit 5) growth, respectively, while also reducing
leverage by 840 bp year-over-year. Underpinning these results was a
16.3% increase in fee bearing capital and resulting 60% increase in
proportionate asset management fees (Exhibit 7). This trend is
expected to continue as the REIT transitions to a more capital
light model with an outsized growth opportunity in healthcare real
estate globally.
Subsequent to year-end, the REIT is pleased to announce
significant progress on several key initiatives that will
accelerate growth in 2022 including:
- UK JV tracking to Q2-2022 close: Completion of UK value
creation initiatives and entering into agreements to refinance the
portfolio, position the UK JV for execution in Q2-2022;
- New $2.2 billion (A$2.4 billion) Australian JV expansion:
Building upon its successful Australian core hospital JV, GIC
(Singapore's sovereign wealth
fund) agreed to expand the JV by $2.2
billion increasing total commitments to $5.6 billion;
- US market entry: After a year of
extensive diligence, the REIT is pleased to announce its US market
entry with the acquisition of a $764.3
million portfolio of cure-focused healthcare assets
comprised of hospitals, ambulatory/out-patient facilities and
medical office buildings;
- Global Healthcare Precinct Strategy: With a growing
investment pipeline and a focus on opportunities at the
intersection of healthcare, research and education the REIT is
launching a new global healthcare precinct development fund.
Commenting on NorthWest's strong results and progress on key
strategic initiatives Paul Dalla
Lana, Chairman and CEO said:
"We are excited with the
performance of the business in 2021 but believe that NorthWest is
really just beginning to hit its stride in terms of unlocking the
full potential of its platform to become a clear global leader in
healthcare real estate. Our long-planned entry into the US opens up
new growth opportunities in the world's largest healthcare market.
Additionally, over the last 12 months, NorthWest has created a
$2 billion plus pipeline of
development opportunities that align with its global healthcare
precinct strategy.
As healthcare systems recover from the pandemic, we see increasing opportunities to
work with new and existing partners across a variety of
high-quality and accretive long-term strategies."
Summary of 2021 Investment Activity
2021 was another busy year for the REIT with total investment
activity of more than $1.0 billion
inclusive of three major transactions totaling $360 million that closed in Q4-2021. Q4-2021
acquisitions included (i) the Tennyson Centre acquired by Vital
Trust in New Zealand for
approximately $83.9
million (NZ$95.8 million); (ii) Epworth Geelong & Elim
Hospitals acquired by the REIT's Australian institutional joint
venture for approximately $124.2
million (A$134.7 million) and
(iii) Cheshire Hospital for approximately $153.3 million (£89.7 million) which was acquired
directly by the REIT in a sale and leaseback transaction with Spire
Healthcare. Cheshire is a high
quality 50 bed hospital located between Manchester and Liverpool in England. Cheshire is highly productive with strong
profitability and a CQC rating of "Outstanding". The acquisition
adds scale and diversification to the REIT's high quality UK
portfolio. During Q4 the REIT entered into firm contracts to
acquire a rehabilitation clinic in Germany for approximately $60 million (€39.9 million), a Dutch MOB for
approximately $10.5 million (€7.0
million), and the fund through of a fully leased development of a
cancer centre in Australia.
On-Going Strategic Initiatives:
Rapidly Progressing UK JV Formation
In Q4-2021, the REIT recorded a fair value gain of $25.2 million increasing the cumulative value
creation over the past two quarters to approximately $200.0 million while also expanding its portfolio
with a $153.3 million acquisition of
Cheshire Hospital – a 50 bed acute care hospital occupied by the
Spire Hospital Group, the UK's third largest private hospital
operator.
Post quarter end, the REIT entered into agreements to refinance
its existing UK debt with a new approximately $454.6 million (£265 million), non-recourse debt
facility led by a local UK lender. The new facility is portable to
the planned joint venture, is interest only and at an approximately
100 bp lower interest rate. The facility is expected to close in
Q2-2022 and is subject to typical closing conditions.
With value creation and refinancing initiatives complete the
REIT is on track to close its UK JV initiative in Q2-2022. As a
reminder, the REIT intends to seed the new fund with its
best-in-class UK hospital portfolio which is anticipated to
generate more than $350 million of
capital for the REIT based on a target hold position of 20% to
30%.
Executing $2.2 billion
Australian Joint Venture Upsize
The REIT's Australian institutional JV has now deployed,
committed, or allocated $3.2 billion
(A$3.4 billion) of the total
committed capital of $3.4 billion
(A$3.7 billion) in its initial
Australian Institutional joint venture. To continue the successful
partnership, the REIT and GIC have reached an agreement to expand
the investment commitment with an incremental commitment of
$2.2 billion (A$2.4 billion) of debt and equity.
US Market Entry
Subsequent to year-end, the REIT entered into a binding
agreement to acquire a portfolio of US healthcare real estate for
$764.3 million (US$601.9 million; the "US Portfolio"). The US
Portfolio is the REIT's first acquisition in the United States, is subject only to typical
closing conditions and is scheduled to close in Q2-2022.
The US Portfolio comprises 27 properties including 7 hospitals,
5 micro-hospitals, and 15 MOBs totaling 1.2 million square
feet. The portfolio is 97% occupied, with a weighted average lease
expiry of 10.7 years and is geographically diversified across 10
states with approximately 60% of NOI coming from top 20 US MSAs
with a focus in the Greater Chicago
Area and Sunbelt States. The portfolio includes an
attractive mix of single-tenant (78% of NOI) and multi-tenant (22%)
properties and 91% of NOI either triple or quadruple net.
The acquisition will initially be funded from a combination of
new corporate and property level financing
and the REITs existing resources. The
transaction will be immediately accretive to
AFFO per
Unit. As the REIT integrates the US Portfolio
and expands on its market entry strategy over the course of 2022 it
intends to recapitalize the acquisition with a new
co-investment partner.
Commenting on the transaction, Paul
Dalla Lana, CEO of the REIT, said:
"The US Portfolio is an excellent
starting point to launch the REIT's US strategy because of the
defensive nature of the portfolio's long-term cash flows,
attractive contractual rent growth and low management intensity;
all of which aligns strongly with the REIT's core investment
strategy. Moreover, this portfolio is a launching pad for accretive
expansion with US pricing typically approximately 100 bp higher on
a cap rate basis than the REIT's other global markets with
transaction volume that is unmatched globally."
Funds Management Platform & Outlook
With the agreement to increase the Australian joint venture by
$2.2 billion (A$2.4 billion), the REIT now has fee bearing
assets under management ("AUM") and capital commitments totaling
$11.4 billion.
Looking ahead to completion of the UK JV, its planned US
co-investment and global healthcare precinct initiatives, all of
which are expected to close later in 2022 total AUM plus capital
commitments are expected to increase to approximately $20.0 billion in the near-term.
As the REIT's funds management platform continues to scale at
pace, it is targeting an ultimate ownership level of between 20% -
30% across its capital platforms and anticipates generating market
leading growth in both AFFO and NAV on per unit basis as a result
of leveraging its capital light model to fund growth.
2021 Fourth Quarter Financial and Operational
Highlights:
For the three months and year ended December 31, 2021, the REIT delivered strong
financial and operational performance with an increasingly
conservative balance sheet across an expanded 197 property, 16.4
million square foot defensive acute healthcare real estate
portfolio underpinned by long-term inflation indexed leases. Key
highlights are as follows:
- Q4 2021 revenue stable year over year at $96.4M;
- Q4 2021 AFFO of $0.23 per unit is
in-line with the previous quarter;
- FY 2021 AFFO of $0.87 per unit,
up 2.2% and 11.8% year-over-year on a constant currency, leverage
neutral basis (Exhibit 3).
- AFFO payout ratio of 88% based on the REIT's $0.80 per unit annual distribution;
- Year to date Same Property NOI growth of 3.6%, driven primarily
by annual rent indexation (see Exhibit 4);
- Strong portfolio occupancy of 97.0% is in line with the
previous quarter;
- Weighted average lease expiry of 14.5 years is underpinned by
the international portfolio's Hospital and Health Care Facility
Assets' weighted average lease expiry of 16.9 years;
- Total assets under management ("AUM") increased 17.3% year over
year to $9.2 billion;
- Total capital deployed in fee bearing vehicles is $5.2 billion up 16.3% year over year. Undeployed
capital in existing fee bearing vehicles totals $3.7 billion;
- Net asset value ("NAV") per unit increased by 9.0% year over
year to $14.47 and 16.6% on a
constant currency basis (see Exhibit 6);
- Debt to Gross Book Value - Including Convertible Debentures of
41.9% has decreased 611 bp, year over year, and is expected to
decrease by a further 810 bp through the seeding of the new UK JV
as well as the conversion of in the money convertible
debentures.
Selected Financial Information:
(unaudited)
($000's, except
unit and per unit amounts)
|
Three months
ended
December 31, 2021
|
Three months
ended
December 31, 2020
|
Number of
properties
|
197
|
188
|
Gross leasable area
(sf)
|
16,391,724
|
15,498,485
|
Occupancy
|
97%
|
97%
|
Weighted Average
Lease Expiry (Years)
|
14.5
|
14.5
|
Net Operating
Income
|
$74,436
|
$71,007
|
Net Income (Loss)
attributable to unitholders
|
$139,452
|
$143,763
|
Funds from Operations
("FFO")
|
$49,376
|
$40,252
|
Adjusted Funds from
Operations ("AFFO")
|
$50,436
|
$38,539
|
Debt to Gross Book
Value - Declaration of Trust
|
39.9 %
|
42.9 %
|
Debt to Gross Book
Value - Including Convertible Debentures
|
41.9 %
|
48.0 %
|
Q4 2021 Conference Call:
The REIT invites you to participate in its conference call with
senior management to discuss our fourth quarter 2021 results on
Friday, March 14, 2022 at
10:00 AM (Eastern).
The conference call can be accessed by dialing 416-764-8609 or 1
(888) 390-0605. The conference ID is 37093308#.
Audio replay will be available from November 12, 2021 through November 19, 2021 by dialing 416-764-8677 or 1
(888) 390-0541. The reservation number is 093308#.
In conjunction with the release of the REIT's third quarter 2021
financial results, the REIT will post a current investor update
presentation to its website where additional information on the
REIT's investments and operating performance may be found. Please
visit the REIT's website at
www.nwhreit.com/Investors/Presentations.
Vital Healthcare Property Trust
On February 24, 2022 Vital Trust
also announced its financial results for the six months ended
December 31, 2021. Details on Vital
Trust's financial results are available on Vital Trust's website at
www.vitalhealthcareproperty.co.nz.
About NorthWest Healthcare Properties Real Estate Investment
Trust
NorthWest Healthcare Properties Real Estate Investment Trust
(TSX: NWH.UN) (NorthWest) is an unincorporated, open-ended real
estate investment trust established under the laws of the Province
of Ontario. As at December 31, 2021, the REIT provides investors
with access to a portfolio of high quality international healthcare
real estate infrastructure comprised of interests in a diversified
portfolio of 197 income-producing properties and 16.4 million
square feet of gross leasable area located throughout major markets
in Canada, Brazil, Europe, Australia and New
Zealand. The REIT's portfolio of medical office buildings,
clinics, and hospitals is characterized by long term indexed leases
and stable occupancies. With a fully integrated and aligned senior
management team, the REIT leverages over 250 professionals in nine
offices in five countries to serve as a long term real estate
partner to leading healthcare operators.
Non-IFRS Financial Measures
Some financial measures used in this press release, such as
SPNOI, Constant Currency SPNOI, FFO, FFO per Unit, AFFO, AFFO per
Unit, AFFO Payout Ratio, NAV, NAV per Unit, portfolio occupancy and
weighted average lease expiry, are used by the real estate industry
to measure and compare the operating performance of real estate
companies, but they do not have any standardized meaning prescribed
by IFRS. As such, they are unlikely to be comparable to similar
measures presented by other real estate companies. These non- IFRS
measures are more fully defined and discussed in the exhibits to
this news release and in the REIT's Management's Discussion and
Analysis ("MD&A") for the three months and year ended
December 31, 2021, in the
"Performance Measurement" and "Results from Operations" sections.
The MD&A is available on the SEDAR website at
www.sedar.com.
Forward-Looking Statements
This press release may contain forward-looking statements with
respect to the REIT, its operations, strategy, financial
performance and condition. These statements generally can be
identified by use of forward-looking words such as "may", "will",
"expect", "estimate", "anticipate", "intends", "believe",
"normalized", "contracted", or "continue" or the negative thereof
or similar variations. Examples of such statements in this press
release may include statements concerning the REIT's position as a
leading healthcare real estate asset manager globally, geographic
expansion, ESG initiatives, expanding AUM, balance sheet
optimization arrangements, the proposed U.K. joint venture and
potential acquisitions, dispositions and other transactions,
including a potential UK joint venture and a potential transaction
involving Australian Unity. The REIT's actual results and
performance discussed herein could differ materially from those
expressed or implied by such statements. The forward-looking
statements contained in this press release are based on numerous
assumptions which may prove incorrect and which could cause actual
results or events to differ materially from the forward-looking
statements. Such assumptions include, but are not limited to (i)
assumptions relating to completion of anticipated acquisitions,
dispositions, development, joint venture, deleveraging and other
transactions (some of which remain subject to completing
documentation) on terms disclosed; (ii) the REIT's properties
continuing to perform as they have recently, (iii) the REIT
successfully integrating past and future acquisitions, including
the realization of synergies in connection therewith; (iv) various
general economic and market factors, including exchange rates
remaining constant, local real estate conditions remaining strong,
interest rates remaining at current levels, the impacts of COVID-19
on the REIT's business ameliorating or remaining stable; and (vii)
the availability of equity and debt financing to the REIT. Such
forward-looking statements are qualified in their entirety by the
inherent risks and uncertainties surrounding future expectations,
including that the transactions contemplated herein are completed.
Important factors that could cause actual results to differ
materially from expectations include, among other things, general
economic and market factors, competition, changes in government
regulations and the factors described under "Risks and
Uncertainties" in the REIT's Annual Information Form and the risks
and uncertainties set out in the MD&A which are available on
www.sedar.com. These cautionary statements qualify all
forward-looking statements attributable to the REIT and persons
acting on its behalf. Unless otherwise stated, all forward-looking
statements speak only as of the date of this press release, and,
except as expressly required by applicable law, the REIT assumes no
obligation to update such statements.
NORTHWEST HEALTHCARE PROPERTIES REAL ESTATE INVESTMENT
TRUST
Condensed Consolidated Interim Statements of Income
(Loss) and Comprehensive Income (Loss)
(in thousands of Canadian dollars)
Unaudited
|
For the three
months ended December 31,
|
For the year ended
December 31,
|
|
|
2021
|
|
2020
|
2021
|
2020
|
Net Property
Operating Income
|
|
|
|
|
|
|
Revenue from
investment properties
|
$
|
96,368
|
$
|
92,845
|
$
|
374,613
|
$
|
373,818
|
Property operating
costs
|
|
21,932
|
|
21,838
|
85,093
|
88,024
|
|
|
74,436
|
|
71,007
|
289,520
|
285,794
|
Other
Income
|
|
|
|
|
|
|
Interest and
other
|
|
1,068
|
|
302
|
4,597
|
1,947
|
Development
revenue
|
|
4,608
|
|
—
|
10,350
|
—
|
Management
fees
|
|
3,396
|
|
4,241
|
16,545
|
11,666
|
Share of profit (loss)
of equity accounted investments
|
|
51,930
|
|
34,831
|
107,483
|
52,091
|
|
|
61,002
|
|
39,374
|
138,975
|
65,704
|
Expenses and
other
|
|
|
|
|
|
|
Mortgage and loan
interest expense
|
|
22,299
|
|
23,893
|
90,461
|
97,748
|
General and
administrative expenses
|
|
10,426
|
|
7,516
|
40,203
|
29,439
|
Transaction
costs
|
|
7,652
|
|
3,309
|
37,984
|
34,933
|
Development
costs
|
|
4,437
|
|
—
|
9,441
|
—
|
Foreign exchange
(gain) loss
|
|
(5,716)
|
|
6,872
|
(14,735)
|
20,508
|
|
|
39,098
|
|
41,590
|
163,354
|
182,628
|
Income before
finance costs, fair value adjustments, and net gain (loss) on
financial instruments
|
|
96,340
|
|
68,791
|
265,141
|
168,870
|
Finance
costs
|
|
|
|
|
Amortization of
financing costs
|
(2,135)
|
(4,179)
|
(12,189)
|
(11,051)
|
Amortization of
mark-to-market adjustment
|
102
|
106
|
416
|
866
|
Class B exchangeable
unit distributions
|
(342)
|
(342)
|
(1,368)
|
(3,501)
|
Fair value adjustment
of Class B exchangeable units
|
(1,505)
|
(2,120)
|
(2,035)
|
83,324
|
Accretion of financial
liabilities
|
(4,276)
|
(2,264)
|
(11,707)
|
(5,585)
|
Fair value adjustment
of convertible debentures
|
(4,938)
|
(6,144)
|
(3,989)
|
2,330
|
Net gain (loss) on
financial instruments
|
(22,488)
|
6,956
|
(9,515)
|
(11,759)
|
Fair value adjustment
of investment properties
|
190,665
|
179,346
|
513,986
|
174,415
|
Fair value adjustment
of deferred unit plan liability
|
(2,060)
|
(2,373)
|
(2,672)
|
(1,673)
|
Income before
taxes from continuing operations
|
249,363
|
237,777
|
736,068
|
396,236
|
|
|
|
|
|
Current tax
expense
|
2,626
|
8,156
|
13,196
|
20,466
|
Deferred tax expense
(recovery)
|
39,375
|
29,372
|
111,033
|
(5,644)
|
Income tax expense
(recovery)
|
42,001
|
37,528
|
124,229
|
14,822
|
Net income from
continuing operations
|
$
|
207,362
|
$
|
200,249
|
$
|
611,839
|
$
|
381,414
|
Net income (loss)
from discontinued operations
|
25,688
|
—
|
51,346
|
—
|
Total net
income
|
$
|
233,050
|
$
|
200,249
|
$
|
663,185
|
$
|
381,414
|
Net income
attributable to:
|
|
|
|
|
Unitholders
|
$
|
139,452
|
$
|
143,763
|
$
|
434,879
|
$
|
314,355
|
Non-controlling
interests
|
93,598
|
56,486
|
228,306
|
67,059
|
|
$
|
233,050
|
$
|
200,249
|
$
|
663,185
|
$
|
381,414
|
Financial Exhibits
Exhibit 1 – Funds From Operations Reconciliation
FFO is a supplemental non-IFRS industry wide financial measure
of a REIT's operating performance. The REIT calculates FFO based on
certain adjustments to net income (computed in accordance with
IFRS) as detailed below. FFO is more fully defined and discussed in
the REIT's MD&A (see "Performance Measurement" and
"Funds From Operations").
|
|
|
|
|
|
|
FUNDS FROM
OPERATIONS
|
|
|
|
|
|
|
Expressed in
thousands of Canadian
dollars, except per unit amounts
|
Three months ended
December 31,
|
Year ended
December 31,
|
|
2021
|
2020
|
Variance
|
2021
|
2020
|
Variance
|
Net income (loss)
attributable to
unitholders
|
$
|
139,452
|
$
|
143,763
|
$
|
(4,311)
|
$
|
434,879
|
$
|
314,355
|
$
|
120,524
|
Add /
(Deduct):
|
|
|
|
|
|
|
(i) Fair market value
losses (gains)
|
(159,674)
|
(175,665)
|
15,991
|
(495,775)
|
(246,637)
|
(249,138)
|
Less:
Non-controlling interests'
share
of fair market value losses
(gains)
|
104,784
|
53,766
|
51,018
|
242,976
|
46,955
|
196,021
|
(ii) Finance cost -
Exchangeable
Unit
distributions
|
342
|
342
|
—
|
1,368
|
3,501
|
(2,133)
|
(iii) Revaluation of
financial
liabilities
|
4,276
|
2,264
|
2,012
|
11,707
|
5,585
|
6,122
|
(iv) Unrealized foreign
exchange
loss
(gain)
|
(5,326)
|
5,621
|
(10,947)
|
(17,339)
|
21,311
|
(38,650)
|
Less:
Non-controlling
interests'
share of unrealized foreign
exchange
loss(gain)
|
(81)
|
2,029
|
(2,110)
|
1,317
|
(104)
|
1,421
|
(v) Deferred
taxes
|
39,375
|
29,372
|
10,003
|
111,033
|
(5,644)
|
116,677
|
Less:
Non-controlling interests'
share
of deferred taxes
|
(13,306)
|
(3,599)
|
(9,707)
|
(33,039)
|
(1,809)
|
(31,230)
|
(vi) Transaction
costs
|
8,287
|
11,141
|
(2,854)
|
45,213
|
47,921
|
(2,708)
|
Less:
Non-controlling interests'
share
of transaction costs
|
(795)
|
(3,737)
|
2,942
|
(962)
|
(8,703)
|
7,741
|
(vii) Net adjustments
for equity
accounted
investments
|
(44,705)
|
(27,898)
|
(16,807)
|
(78,743)
|
(32,134)
|
(46,609)
|
(viii) Internal leasing
costs
|
619
|
497
|
122
|
2,768
|
2,364
|
404
|
(ix) Net adjustment for
discontinued
operations
|
(24,144)
|
—
|
(24,144)
|
(49,056)
|
—
|
(49,056)
|
* Net adjustment for
lease
amortization
|
(33)
|
(131)
|
98
|
(231)
|
(354)
|
123
|
(xi) Other FFO
adjustments
|
305
|
2,487
|
(2,182)
|
1,529
|
5,684
|
(4,155)
|
Funds From
Operations ("FFO") (1)
|
$
|
49,376
|
$
|
40,252
|
$
|
9,124
|
$
|
177,645
|
$
|
152,291
|
$
|
25,354
|
|
|
|
|
|
|
|
FFO per Unit -
Basic
|
$
|
0.22
|
$
|
0.23
|
$
|
(0.01)
|
$
|
0.86
|
$
|
0.86
|
$
|
—
|
FFO per Unit - fully
diluted (3)
|
$
|
0.22
|
$
|
0.22
|
$
|
—
|
$
|
0.84
|
$
|
0.83
|
$
|
0.01
|
Adjusted weighted
average units outstanding (2)
|
|
|
|
|
|
|
Basic
|
222,600,122
|
177,563,647
|
45,036,475
|
206,844,980
|
177,207,485
|
29,637,495
|
Diluted
(3)
|
234,287,101
|
201,349,114
|
32,937,987
|
218,777,321
|
200,831,556
|
17,945,765
|
|
Notes
|
(1)
|
FFO is not a measure
recognized under IFRS and does not have standardized meanings
prescribed by IFRS. See Performance Measurements
section in the REIT's MD&A.
|
(2)
|
Under IFRS the REIT's
Class B LP Units are treated as a financial liability rather than
equity. The REIT has chosen to present an adjusted basic and
diluted per unit measure that includes the Class B LP Units in
basic and diluted units outstanding/weighted average units
outstanding. There were 1,710,000 Class B LP Units outstanding as
at December 31, 2021 and 1,710,000 outstanding as at December 31,
2020.
|
(3)
|
Diluted units
includes vested but unissued deferred trust units and the
conversion of the REIT's Convertible Debentures that would have a
dilutive effect upon conversion at the holders' contractual
conversion price. Convertible Debentures are dilutive if the
interest (net of tax and other changes in income or expense) per
unit obtainable on conversion is less than the basic per unit
measure.
|
Exhibit 2 – Adjusted Funds From Operations
Reconciliation
AFFO is a supplemental non-IFRS financial measure of a REIT's
operating performance and is intended to reflect a stabilized
business environment. The REIT calculates AFFO as FFO, plus/minus
certain adjustments as detailed below. AFFO is more fully defined
and discussed in the REIT's MD&A (see "Performance
Measurement" and "Adjusted Funds From Operations").
|
|
|
|
|
|
|
ADJUSTED FUNDS
FROM OPERATIONS
|
|
|
|
|
|
|
Expressed in
thousands of
Canadian dollars, except per unit
amounts
|
Three months
ended December 31,
|
Year ended
December 31,
|
|
2021
|
2020
|
Variance
|
2021
|
2020
|
Variance
|
|
|
|
|
|
|
|
FFO
(1)
|
$
|
49,376
|
$
|
40,252
|
$
|
9,124
|
$
|
177,645
|
$
|
152,291
|
$
|
25,354
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add /
(Deduct):
|
|
|
|
|
|
|
(i) Amortization
of marked to
market adjustment
|
(102)
|
(106)
|
4
|
(416)
|
(866)
|
50
|
(ii)Amortization
of transactional
deferred
financing charges
|
2,005
|
364
|
1,641
|
3,198
|
4,125
|
(927)
|
(iii)Straight-line revenue
|
761
|
354
|
407
|
2,101
|
198
|
1,903
|
Less: non-controlling
interests'
share of straight-line
revenue
|
(475)
|
(449)
|
(26)
|
(1,666)
|
(1,145)
|
(521)
|
(iv) Leasing
costs and non
- recoverable maintenance
capital expenditures
|
(2,727)
|
(2,982)
|
55
|
(11,017)
|
(12,325)
|
1,308
|
Less:
non-controlling interests'
share of actual capex and
leasing costs
|
27
|
289
|
(262)
|
731
|
1,004
|
(273)
|
(v) DUP Compensation
Expense
|
1,771
|
1,063
|
708
|
8,980
|
7,374
|
1,606
|
(vi) Debt
repayment costs
|
9
|
—
|
9
|
39
|
19
|
20
|
(vii)Net adjustments
for equity
accounted investments
|
(209)
|
(246)
|
37
|
(634)
|
(406)
|
(228)
|
Adjusted Funds
From Operations
("AFFO") (1)
|
$
|
50,436
|
$
|
38,539
|
$
|
11,897
|
$
|
178,961
|
$
|
150,269
|
$
|
28,692
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AFFO per Unit -
Basic
|
$
|
0.23
|
$
|
0.22
|
$
|
0.01
|
$
|
0.87
|
$
|
0.85
|
$
|
0.02
|
AFFO per Unit - fully
diluted (3)
|
$
|
0.22
|
$
|
0.21
|
$
|
0.01
|
$
|
0.85
|
$
|
0.82
|
$
|
0.03
|
Distributions per
Unit - Basic
|
$
|
0.20
|
$
|
0.20
|
$
|
—
|
$
|
0.80
|
$
|
0.80
|
$
|
—
|
Adjusted weighted
average units
outstanding: (2)
|
|
|
|
|
|
|
Basic
|
222,600,122
|
177,563,647
|
45,036,475
|
206,844,980
|
177,207,485
|
29,637,495
|
Diluted
(3)
|
234,287,101
|
201,349,114
|
32,937,987
|
218,777,321
|
200,831,556
|
17,945,765
|
|
Notes
|
(1)
|
FFO and AFFO are not
measures recognized under IFRS and do not have standardized
meanings prescribed by IFRS. See Performance Measurement
section in the REIT's MD&A.
|
(2)
|
Under IFRS the REIT's
Class B LP Units are treated as a financial liability rather than
equity. The REIT has chosen to present an adjusted basic and
diluted per unit measure that includes the Class B LP Units in
basic and diluted units outstanding/ weighted average units
outstanding. There were 1,710,000 Class B LP Units outstanding as
at December 31, 2021 and 1,710,000 outstanding as at December 31,
2020.
|
(3)
|
Distributions per
units is a non-IFRS ratio calculated as sum of the distributions on
the REIT's units and finance costs on Class B LP Units. Management
does not consider finance costs on Class B LP units to be an
financing cost of the REIT but rather component of the REIT's total
distributions. Distributions is not defined by IFRS and does not
have a standard meaning and may not be comparable with similar
measures presented by other issuers.
|
Exhibit 3 – Constant currency, constant leverage AFFO
Reconciliation
Constant currency, constant leverage AFFO is a non-IFRS measure
defined as AFFO adjusted for foreign currency translation and
leverage. Management considers constant currency, constant leverage
AFFO to be a useful measure for comparing period over period
operating performance excluding the impact of foreign exchange rate
movements and changes in capital structure. The REIT's method of
calculating constant currency, constant leverage AFFO may differ
from other issuers' methods and accordingly may not be comparable
to measures used by other issuers.
|
Constant currency,
constant leverage AFFO
|
Expressed in
thousands of Canadian dollars, except
per unit amounts
|
Year ended
December 31,
|
|
2021
|
2020
|
Var
%
|
AFFO
|
$
|
178,961
|
$
|
150,269
|
19.1 %
|
Impact of foreign
currency translation
|
7,710
|
—
|
n/a
|
Interest adjustment
for constant leverage
|
(8,494)
|
—
|
n/a
|
Constant currency,
constant leverage AFFO
|
178,177
|
150,269
|
18.6 %
|
Constant currency,
constant leverage AFFO per Unit
|
0.95
|
0.85
|
11.8 %
|
Weighted average units
outstanding
|
206,845
|
177,207
|
16.7 %
|
Leverage
adjustment
|
(19,303)
|
—
|
n/a
|
Adjusted weighted
average units outstanding
|
187,542
|
177,207
|
5.8 %
|
Exhibit 4 – Constant Currency Same Property NOI
Constant Currency Same Property NOI, sometimes also presented
as"Same Property NOI" or "SPNOI", is a non-IFRS financial measure,
defined as NOI for investment properties that were owned for a full
reporting period in both the current and comparative year, subject
to certain adjustments including: (i) straight-line rental revenue
recognition; (ii) amortization of operating leases; (iii) lease
termination fees; and (iv) non-recurring transactions that are not
expected to recur (v) excluding properties held for redevelopment
and (vi) excluding impact of foreign currency translation by
converting the foreign currency denominated SPNOI from comparative
period at current period average exchange rates. Management
considers. SPNOI is more fully defined and discussed in the REIT's
MD&A (see
"Performance Measurement").
|
|
|
|
|
|
|
SAME PROPERTY
NOI
|
|
|
|
|
|
|
Expressed in
thousands of Canadian dollars
|
|
|
|
|
|
|
|
Three months
ended December 31,
|
Year ended
December 31,
|
|
2021
|
2020
|
Var
%
|
2021
|
2020
|
Var
%
|
Same property
NOI (1)
|
|
|
|
|
|
|
Canada
|
$
|
16,757
|
$
|
16,475
|
1.7 %
|
$
|
65,552
|
$
|
64,751
|
1.2 %
|
Brazil
|
10,353
|
9,686
|
6.9 %
|
41,524
|
39,620
|
4.8 %
|
Europe
|
14,531
|
15,136
|
(4.0)%
|
20,297
|
20,082
|
1.1 %
|
Vital Trust - New
Zealand
|
23,423
|
22,487
|
4.2 %
|
90,135
|
85,458
|
5.5 %
|
Australia
|
2,097
|
2,010
|
4.3 %
|
8,482
|
8,253
|
2.8 %
|
Same property
NOI (1)
|
$
|
67,161
|
$
|
65,794
|
2.1
%
|
$
|
225,990
|
$
|
218,164
|
3.6
%
|
Impact of
foreign currency translation on Same Property NOI
|
—
|
1,768
|
|
—
|
4,019
|
|
Straight-line rental
revenue recognition
|
153
|
223
|
|
1,011
|
2,189
|
|
Amortization of
operating leases
|
(533)
|
(279)
|
|
(1,787)
|
(1,107)
|
|
Lease termination
fees
|
11
|
11
|
|
617
|
156
|
|
Other
transactions
|
(88)
|
135
|
|
887
|
(692)
|
|
Developments
|
170
|
366
|
|
941
|
1,233
|
|
Acquisitions
|
7,072
|
239
|
|
59,756
|
24,370
|
|
Dispositions
|
(6)
|
2,412
|
|
329
|
36,060
|
|
Intercompany/Elimination
|
496
|
338
|
|
1,776
|
1,402
|
|
NOI
|
$
|
74,436
|
$
|
71,007
|
4.8
%
|
$
|
289,520
|
$
|
285,794
|
1.3
%
|
Notes:
|
(1) Same
property NOI is a non-IFRS measure, defined and discussed in the
REIT's MD&A.
|
(2) NOI is an additional IFRS measure presented on the consolidated statement of income (loss) and comprehensive income (loss). NOI is
defined and discussed in the REIT's MD&A.
|
Exhibit 5 – Net Asset Value ('NAV') per Unit
"NAV per Unit" or sometimes presented as "NAV/unit" is an
extension of NAV and defined as NAV divided by the number of units
outstanding at the end of the period. NAV and NAV/unit is more
fully defined and discussed in the REIT's MD&A (see
"Performance Measurement" and "Part IX – Net Asset
Value").
Expressed in thousands of Canadian dollars, except
per unit amounts
|
|
Q4
2021
|
Q4
2020
|
Total
Assets
|
|
$
|
7,064,401
|
|
$
|
5,845,238
|
less: Total
liabilities
|
|
(3,540,827)
|
|
(3,309,570)
|
less: Non-controlling
interests
|
|
(1,131,443)
|
|
(897,249)
|
Unitholders'
equity
|
|
2,392,131
|
|
1,638,419
|
Add/(deduct):
|
|
|
|
|
Goodwill
|
|
(41,671)
|
|
(41,671)
|
Deferred unit plan
liability
|
|
26,223
|
|
24,277
|
Deferred tax
liability
|
374,845
|
|
287,820
|
|
less NCI
|
(91,052)
|
283,793
|
(69,060)
|
218,760
|
Financial instruments
- net
|
22,602
|
|
61,864
|
|
less NCI
|
(15,363)
|
7,239
|
(40,809)
|
21,055
|
Exchangeable
Units
|
|
23,581
|
|
21,546
|
Global Manager
valuation adjustment
|
|
576,318
|
|
476,318
|
Other
|
|
—
|
|
1
|
Net Asset Value
("NAV")
|
|
$
|
3,267,614
|
|
$
|
2,358,705
|
Adjusted Units
Outstanding (000s)- period end (1)
|
|
225,837
|
|
177,688
|
NAV per
Unit
|
|
$
|
14.47
|
|
$
|
13.27
|
Notes
|
(1)
|
Under IFRS the REIT's
Class B LP Units are treated as a financial liability rather than
equity. The REIT has chosen to present an adjusted basic per unit
measure that includes the Class B LP Units in basic units
outstanding/weighted average units outstanding.
|
Exhibit 6 – Constant currency Net Asset Value ('NAV') per
Unit
"Constant currency NAV per Unit" is an extension of NAV per Unit
and defined as NAV adjusted for foreign currency translation
divided by the number of units outstanding at the end of the
period. The REIT's method of calculating constant currency NAV may
differ from other issuers' methods and accordingly may not be
comparable to measures used by other issuers.
|
|
|
|
Constant currency
NAV
|
|
|
|
Expressed in
thousands of Canadian dollars, except
per unit amounts
|
Year ended
December 31,
|
|
|
2021
|
2020
|
Var
%
|
NAV
|
$
|
3,267,614
|
$
|
2,358,705
|
38.5 %
|
Impact of foreign
currency translation
|
225,494
|
—
|
n/a
|
Constant currency
NAV
|
$
|
3,493,108
|
$
|
2,358,705
|
48.1 %
|
Constant currency NAV
per Unit
|
$
|
15.47
|
$
|
13.27
|
16.6 %
|
Adjusted Units
Outstanding (000s)- period end (1)
|
225,837
|
177,688
|
27.1 %
|
(1) Under IFRS the
REIT's Class B LP Units are treated as a financial liability rather
than equity. The REIT has chosen to present an adjusted basic per
unit measure that includes the Class B LP Units in basic units
outstanding/weighted average units outstanding.
|
Exhibit 7 – Proportionate Management Fees
"Proportionate Management Fees" is a non-IFRS financial measure
defined as the REIT's total management fees earned from third
parties adjusted to be reflected on a proportionately consolidated
basis at the REIT's ownership percentage (see "Performance
Measurement" "PART III – RESULTS FROM OPERATIONS – NET
INCOME").
|
|
|
|
|
|
|
GLOBAL MANAGER
FEES
|
|
|
|
|
|
|
Expressed in
thousands of Canadian dollars
|
Three months
ended December 31,
|
Year ended
December 31,
|
|
2021
|
2020
|
Variance
|
2021
|
2020
|
Variance
|
Base fee
|
$
|
7,143
|
$
|
6,416
|
$
|
727
|
$
|
27,645
|
$
|
23,158
|
$
|
4,487
|
Incentive and
performance fee
|
6,336
|
1,830
|
4,506
|
17,155
|
5,324
|
11,831
|
Trustee fees
|
253
|
221
|
32
|
944
|
828
|
116
|
Project and Acquisition
fees
|
4,341
|
5,734
|
(1,393)
|
14,485
|
10,888
|
3,597
|
Other fees
|
191
|
—
|
191
|
4,411
|
—
|
4,411
|
Total Management
Fees
|
$
|
18,264
|
$
|
14,201
|
$
|
4,063
|
$
|
64,640
|
$
|
40,198
|
$
|
24,442
|
less: inter-company
elimination (1)
|
(14,868)
|
(9,960)
|
(4,908)
|
(48,095)
|
(28,532)
|
(19,563)
|
Consolidated
Management Fees (2)
|
$
|
3,396
|
$
|
4,241
|
$
|
(845)
|
$
|
16,545
|
$
|
11,666
|
$
|
4,879
|
add: fees charged to
non-controlling interests
|
9,931
|
6,648
|
3,283
|
32,133
|
19,011
|
13,122
|
Proportionate
Management Fees (3)
|
$
|
13,327
|
$
|
10,889
|
$
|
2,438
|
$
|
48,678
|
$
|
30,677
|
$
|
18,001
|
Notes
|
(1)
|
Management fees
charged to Vital Trust and to the JVs are eliminated on
consolidation as an inter-company transaction.
|
(2)
|
Represents the
reported consolidated management fees.
|
(3)
|
See
Performance Measurements in the
REIT's MD&A.
|
SOURCE NorthWest Healthcare Properties Real Estate Investment
Trust