TORONTO, ONTARIO, May 4, 2010 (Marketwire) -- Charter Real Estate Investment Trust ("Charter REIT") (TSX VENTURE:CRH.UN) is pleased to announce its financial results for the quarter ended March 31, 2010.
Highlights
-- Charter REIT continues its goal of trying to generate organic growth
through redevelopment and re-leasing activities at its existing centres.
The redevelopment of its Chateauguay property, through the replacement
of a 15,000 square foot cinema tenant with an 18,138 square foot
Pharmaprix (Shoppers Drug Mart) store for a 15 year term, was completed
in the first quarter of 2010 with Pharmaprix opening its doors in early
March.
-- Despite the leasing success at the Chateauguay property, overall
occupancy for Charter REIT at the end of the quarter was 92.0%, down
from 95.1% at year end. The reduced occupancy was mainly due to (i) an
18,573 square foot local dollar store operator vacating its premises in
February 2010 at the Mega Centre, (ii) the expiry on March 31, 2010 of a
retail tenant occupying 12,012 square feet at the Chateauguay property
and (iii) the inability to lease the vacant SAAN space at Place Val Est
(23,000 square feet).
Financial highlights
-- Charter REIT recorded funds from operations ("FFO") of $705,058 or $0.04
per unit basic and diluted for the quarter ended March 31, 2010, a
decrease of 41.9% from the quarter ended March 31, 2009. The decrease
mainly relates to a decrease in net operating income.
-- Charter REIT recorded net operating income ("NOI") and same-property NOI
of $2,417,950 for the quarter ended March 31, 2010, a 13.4% decrease
from the $2,794,806 recorded for the quarter ended March 31, 2009. NOI
was negatively impacted by the high vacancy rate at Place Val Est, as
well as the recent vacancy and a tenant underperformance at the Mega
Centre property where NOI dropped by almost 18% compared to the prior
year. At Cornwall Square, NOI decreased compared to the prior year as a
result of new accounting standards implemented in 2009 that caused a
one-time adjustment to recoveries recorded in the prior year. Finally,
NOI was negatively impacted at the Chateauguay property on a year over
year basis as a result of construction of the Pharmaprix store through
most of the first quarter. The second quarter will see the full positive
impact on NOI of this deal.
-- Charter REIT had a net loss of $797,906 or $0.04 per unit basic and
diluted for the quarter ended March 31, 2010 (for the quarter ended
March 31, 2009 - net loss of $194,715 or $0.01 per unit basic and
diluted).Outlook
Charter REIT has made good progress on its leasing and redevelopment initiatives at its Chateauguay property and for 2010, this focus will continue at its other properties as well. In particular, Charter REIT's goal will be to lease vacant space and strengthen the tenant mix with a focus on more stable national and regional tenants, as local tenants have struggled to survive in today's economic conditions and have disproportionately contributed to declines in Charter REIT's NOI. As well, Charter REIT has been actively looking for alternative ways to grow its asset base, especially in light of Charter REIT's major unitholder engaging in a strategic review process. This will be an ongoing key focus for Charter REIT in 2010.
2010 Q1 financial results
For the complete first quarter 2010 Management's Discussion and Analysis and Financial Statements, please visit www.sedar.com or www.charterreit.com.
Charter REIT
Charter Real Estate Investment Trust is an open-ended real estate investment trust established under the laws of the Province of Ontario. Charter REIT is focused on acquiring and managing a portfolio of retail and mixed-use retail community and neighbourhood centres, generally in the mid-market deal size range of $10 to $40 million, from both primary and secondary markets throughout Canada. Charter REIT currently owns ten retail properties located in Ontario and Quebec.
This press release contains forward-looking statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forward-looking statements are based on a number of assumptions which may prove to be incorrect. Important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, local real estate conditions, including the development of properties in close proximity to Charter REIT's properties, competition, changes in government regulation, dependence on tenants, financial conditions, interest rates, the availability of equity and debt financing, environmental and tax-related matters, reliance on the Manager, potential conflicts of interest and reliance on key personnel. The cautionary statements qualify all forward-looking statements attributable to Charter REIT and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release.
Charter Real Estate Investment Trust
The Exchange Tower
130 King Street West
Suite 2810, P.O. Box 433
Toronto, Ontario M5X 1A4
Telephone: (416) 364-5705
Fax: (416) 861-8166
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
