BTB Real Estate Investment (BTB-UN) Q4 2023 earnings summary

Executive summary

• FY2023 rental revenue rose 7.0% to $127.8M and NOI rose 7.0% to $75.4M; year-end committed occupancy was 94.2%.

• The 6.1M sq. ft. portfolio comprised 77 properties with $1.2B fair value; industrial assets grew to 36.4% of the portfolio from 18.1% in 2020.

Financial highlights

• Q4 NOI was $19.3M, up 3.4% YoY; FY NOI was $75.4M, up 7.0%.

• Net income and comprehensive income was $1.7M in Q4 versus $1.8M; FY income was $36.6M versus $38.2M.

• FY adjusted EBITDA was $69.7M versus $64.4M; adjusted FFO was $38.9M versus $37.9M, and adjusted AFFO was $35.0M versus $34.1M.

• Adjusted FFO per unit was 45.1¢ for FY versus 45.4¢ and 11.1¢ in Q4 versus 11.8¢; adjusted AFFO per unit was 40.5¢ for FY versus 40.9¢ and 10.3¢ in Q4 versus 10.0¢.

• Net financial expenses increased $18.9M YoY, contributing to lower annual net income.

Outlook and guidance

• A 43,500 sq. ft. retail pad at Méga Centre Rive-Sud is planned for a nationally recognized retailer under a long-term lease; projected yield is ~9%, with 12–18 months of construction.

• At least six densification opportunities are under review in Montréal, Québec City and Ottawa; one residential development depends on a zoning change.

• An adjacent parcel at 2611 Queensview Drive is expected to transition to community development, with LRT on site.

• 2024 ESG plans include completing energy data collection, quantifying GHG emissions and increasing BOMA BEST or LEED certification coverage to 68% of eligible portfolio.