Mr. Philip Fraser reports

KILLAM APARTMENT REIT ANNOUNCES Q1-2023 OPERATING PERFORMANCE AND FINANCIAL RESULTS

Killam Apartment Real Estate Investment Trust has released its results for the three months ended March 31, 2023.

"Killam's first quarter delivered strong operating performance and financial results, with [funds from operations] per unit growth of 4.2 per cent compared to [first quarter] 2022," noted Philip Fraser, president and chief executive officer. "Fundamentals in our core markets are stronger than ever. Looking forward, we expect our portfolio to maintain healthy revenue and [net operating income] growth.

"Killam initiated its capital recycling program, and year to date, we have completed $42.8-million of dispositions, generating $27.1-million of net cash proceeds. Our focus on dispositions in 2023 aligns with our goal of recycling assets to maximize long-term value creation and strengthen our balance sheet. I am pleased to report that we are on track to exceed our capital recycling goal of $100-million in 2023.

"In addition, we are pleased with the progress on our development projects and the successful lease-up of three developments we completed in 2022. Killam's development program is extensive and an important component of our long-term growth plan."

Q1 2023 financial and operating highlights:

• Reported net income of $83.5-million, an increase of $23.5-million compared with $60.0-million in Q1 2022; the growth in net income is primarily attributable to $66.8-million of fair value gains on investment properties in the period;
• Generated net operating income of $50.8-million, a 12.3-per-cent increase from $45.3-million in Q1 2022;
• Earned funds from operations per unit (diluted) of 25 cents, a 4.2-per-cent increase from 24 cents in Q1 2022 (1);
• Increased adjusted funds from operations (AFFO) per unit (diluted) by 5.0 per cent to 21 cents from 20 cents in Q1 2022, and reduced the rolling 12-month AFFO payout ratio (diluted) by 200 basis points to 74 per cent from 76 per cent in Q1 2022 (1);
• Achieved a 5.4-per-cent increase in revenue for the same-property portfolio compared with Q1 2022;
• Generated same-property NOI growth of 6.3 per cent compared with Q1 2022 (2).

(1) FFO and AFFO are non-international financial reporting standard measures that do not have a standardized meaning according to IFRS and, therefore, may not be comparable with similar measures presented by other issuers.

(2) Same-property NOI is a supplementary financial measure.

Environmental, social and governance update

During Q1 2023, Killam Apartment invested $1.2-million in energy initiatives. At the end of the quarter, Killam Apartment had 18 photovoltaic (PV) solar arrays producing power, with an expected 1,817 megawatt-hours of annual energy production. This is the equivalent amount of energy to supply 343 apartment units with electricity annually, based on the average consumption per unit in Killam Apartment's apartment portfolio. PV solar arrays, along with geothermal heating and cooling systems at Killam Apartment's new developments, illustrate Killam Apartment's continuing commitment to lowering its carbon footprint. Additionally, Killam Apartment is rolling out Level 2 electric vehicle charging stations across its portfolio, with 187 charging stations installed at 30 properties to date, plus an additional 103 charging stations at 12 different properties under way.

Financial statements

Killam Apartment's condensed consolidated interim financial statements and management's discussion and analysis for the three months ended March 31, 2023, are posted under financial reports in the investor relations section of Killam Apartment's website and are available on SEDAR. Readers are directed to these documents for financial details and a discussion of Killam Apartment's results.

Results conference call

Management will host a webcast and conference call to discuss these results and current business initiatives on Thursday, May 4, 2022, at 9 a.m. Eastern Time. The webcast will be available on Killam Apartment's website. A replay will be available for seven days after the webcast.

The dial-in numbers for the conference call are as follows.

North America (toll-free):  1-888-664-6392

Overseas or local (Toronto):  1-416-764-8659

About Killam Apartment Real Estate Investment Trust

Killam Apartment, based in Halifax, N.S., is one of Canada's largest residential real estate investment trusts, owning, operating, managing and developing a $4.9-billion portfolio of apartments and manufactured home communities. Killam Apartment's strategy to enhance value and profitability focuses on three priorities: (1) increasing earnings from existing operations; (2) expanding the portfolio and diversifying geographically through accretive acquisitions, with an emphasis on newer properties; and (3) developing high-quality properties in its core markets.

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