Mr. K. Rai Sahi reports

MORGUARD NORTH AMERICAN RESIDENTIAL REIT ANNOUNCES 2023 SECOND QUARTER RESULTS

Morguard North American Residential REIT has released its financial results for the three and six months ended June 30, 2023.

Highlights

The REIT is reporting second quarter performance of:

• Net operating income (NOI) of $53.5-million for the three months ended June 30, 2023, an increase of $11-million, or 26.0 per cent, compared with 2022; the change in foreign exchange rate increased NOI by $3.4-million;
• Same-property proportionate NOI in Canada increased by $2.2-million (or 16.0 per cent) and in the United States increased by $1.1-million (U.S.) (or 6.4 per cent) compared with 2022;
• Net income of $87.5-million for the three months ended June 30, 2023, a decrease of $79-million, or 47.5 per cent, compared with 2022, predominantly due to lower fair-value gains and a decrease in deferred income tax;
• Basic funds from operations (FFO) of $23.7-million for the three months ended June 30, 2023, an increase of $3.9-million, or 19.6 per cent, over the same period in 2022;
• Basic FFO of 42 cents per unit for the three months ended June 30, 2023, a 20-per-cent increase as compared with 35 cents per unit in 2022;
• FFO payout ratio for the three months ended June 30, 2023, of 42.5 per cent, compared with 49.7 per cent in 2022.

The REIT is reporting the following corporate and portfolio highlights:

• As at June 30, 2023, average monthly rent (AMR) in the United States, on a same-property basis, increased by 9.0 per cent compared with June 30, 2022, while occupancy was 95.1 per cent at June 30, 2023, compared with 96.4 per cent at June 30, 2022;
• As at June 30, 2023, AMR in Canada increased by 4.2 per cent compared with June 30, 2022, while occupancy improved to 98.4 per cent at June 30, 2023, compared with 95.2 per cent at June 30, 2022;
• As at June 30, 2023, indebtedness to gross book value ratio of 38.4 per cent, compared with 38.0 per cent as at Dec. 31, 2022;
• As at June 30, 2023, the REIT's total assets were valued at $4.1-billion, compared with $3.9-billion as at Dec. 31, 2022.

Subsequent event

The REIT entered into binding agreements for the refinancing of two multisuite residential properties located in Pensacola, Fla., for an aggregate amount of $36.8-million ($27.8-million (U.S.)) at an interest rate of 5.66 per cent and for terms of eight years. The maturing mortgages amount to $20.7-million ($15.6-million (U.S.)) and have a weighted average interest rate of 3.39 per cent.

The REIT's condensed consolidated financial statements for the three and six months ended June 30, 2023, along with the management discussion and analysis, will be available on the REIT's website and will be filed on SEDAR.

Conference call details

Morguard North American Residential will hold a conference call on Thursday, July 27, 2023, at 3 p.m. ET, to discuss the financial results for the three and six months ended June 30, 2023, and 2022. To participate in the conference call, please dial 416-764-8688 or 1-888-390-0546. Please quote conference ID 81807013.

About Morguard North American Residential REIT

The REIT is an unincorporated, open-ended real estate investment trust established under and governed by the laws of the Province of Ontario. The units of the REIT trade on the Toronto Stock Exchange under the ticker symbol MRG.UN. With a strategic focus on the acquisition of high-quality multisuite residential properties in Canada and the United States, the REIT maximizes long-term unit value through active asset and property management. The REIT's portfolio comprises 13,089 residential suites and 239,500 square feet of commercial area (as of July 25, 2023) located in Alberta, Ontario, Colorado, Texas, Louisiana, Illinois, Georgia, Florida, North Carolina, Virginia and Maryland with an appraised value of approximately $4-billion at June 30, 2023.

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