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GT Canada Medical Properties REIT (TSX-V: MOB.UN) announces second quarter 2011 financial results

^{Published on 2011-08-22 06:46:52 - Market Wire}
 

TORONTO, Aug. 22, 2011 /CNW/ - GT Canada Medical Properties Real Estate Investment Trust (the "REIT") is pleased to announce its financial results for the three months ended June 30, 2011.

Highlights

Refinancing

• The REIT refinanced (the "Refinancing") four of its properties for a gross amount of $17.3 million which generated additional net proceeds available for acquisitons and general corporate purposes of $4.2 million.  The Refinancing reduced the weighted average interest rate on the REIT's mortgages payable to 5.13% from 5.51%.  The term for three of the mortgages was extended to five years and amortization periods increased to 25 years.

New credit facility

• The REIT established a revolving credit facility agreement (the "Credit Facility") in the amount of approximately $5.7 million to finance property acquisitions and working capital. Amounts outstanding under the Credit Facility bear interest at a rate equal to the lender's prime rate plus 200 basis points.  The Credit Facility has an initial two-year term and is secured by a first mortgage.

New building completed

• The REIT announced that Guelph Medical Place 2 - a new 30,000 square foot medical office building located at 89 Dawson Road in Guelph, Ontario - was certified substantially complete. Guelph Medical Place 2 was acquired December 24, 2010, while under construction and 80% pre-leased, for an 8.25% cap rate.

Acquisition announced

• Subsequent to the quarter end, on August 17, 2011, the REIT announced that it had entered into an agreement to purchase the Huronia Medical Centre, a 23,000 s.f. medical office building in Midland, Ontario for approximately $5.2 million, subject to customary closing conditions.  The building's tenants are medical practitioners with a pharmacy, lab and x-ray facilities and is 100% occupied. The cap rate on the transaction is 8.27%.  The transaction is expected to close in the third quarter.

Financial Results

Funds From Operations

The REIT's Funds From Operations ("FFO") represents the recurring cash flow generated through the ownership of income producing properties. The primary difference between comphensive income and FFO is the fair value gain (loss) on investment properties and other fair value gains (losses).

• For the three months ended June 30, 2011 FFO increased to $98,580 or $0.01 per unit from a loss of ($259,344) or ($0.13) per unit for the same period in 2010.  For the six months ended June 30, 2011, FFO increased to $388,764 or $0.03 per unit froma loss of ($561,396) or ($0.41) per unit for the same period in 2010.
• The improvement in FFO is primarily a result of the five properties acquired in December 2010.

Comprehensive Income

• Comprehensive income for the three months ended June 30, 2011 increased to $1,990,060 or $0.13 per unit from a loss of ($259,344) or ($0.44) per unit for the three months ended June 30, 2010.  For the six months ended June 30, 2011, comprehensive income increased to $6,750,077 or $0.43 per unit from a loss of ($561,396) or ($0.41) per unit for the six months ended June 30, 2010.
• The improvement in comprehensive income was primarily a consequence of fair value gains on investment properties resulting from declining cap rates and fair value gains attributable to the warrant liability.

Outlook

The REIT continues to seek growth through acquisitions, with a discipline of continuing to build a portfolio comprised exclusively of medical office buildings that are physician intensive with high occupancy rates.

2011 Second Quarter Financial Results

For the REIT's complete second quarter 2011 Condensed Consolidated Financial Statements and Management's Discussion and Analysis ("MD&A"), please visit [ www.sedar.com ]

GT Canada Medical Properties REIT

As Canada's only publicly traded issuer focused exclusively on medical office buildings, GT Canada Medical Properties Real Estate Investment Trust is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. The REIT's objectives are to: (i) provide its unitholders with stable and growing cash distributions from investments focused on medical office buildings, on a tax efficient basis; (ii) enhance the value of the REIT's assets and maximize long-term unit value; and (iii) expand the asset base of the REIT.

Some financial measures used in this press release, such as FFO, 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 REIT's MD&A for the second quarter of 2011, which is available on the SEDAR website at [ www.sedar.com ]. 

This press release contains forward-looking statements. Forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements may include, among other things, statements related to acquisitions; development and capital expenditure activities; future maintenance and leasing expenditures; financing; the availability of financing sources; and income taxes. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the REIT to be materially different from any future results, performance or achievements. 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 "Risk Factors" in the REIT's MD&A, which is 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.