Crombie Real Estate Investment Trust (CRR.UN) Q3 2024 earnings summary

Executive summary

• Achieved consistent and resilient Q3 2024 performance with high occupancy, strong property revenue and NOI growth, and continued execution of value creation and portfolio optimization strategies.

• Maintained a necessity-based, diversified portfolio focused on grocery-anchored retail, complementary industrial, and mixed-use residential assets, with active leasing and property acquisitions/dispositions.

• Strategic actions included acquiring the remaining 50% of the Zephyr property in Vancouver and disposing of two non-core retail properties.

• Committed occupancy was 96.1%, with renewals at rents 9.7% above expiring rates and new leases increasing occupancy.

• Maintained a robust and flexible balance sheet, supporting strategic initiatives and long-term value creation.

Financial highlights

• Property revenue increased 4.6% year-over-year to $114.5M; same-asset property cash NOI grew 2.6%; retail assets up 3.1%.

• FFO per unit was $0.31 (flat year-over-year); AFFO per unit was $0.27 (down 3.6%); year-to-date FFO per unit up 6.9%.

• Renewal growth reached 9.7% in Q3 2024.

• AFFO payout ratio at 83.6%, FFO payout ratio at 72.5%, both improved from Q3 2023.

• Available liquidity stood at $677 million, up 19.8% year-over-year.

Outlook and guidance

• No changes to projections for major development yields or lease-up timelines despite recent immigration policy changes.

• Yield on cost projections for non-major developments range from 6.9% to 8.0%.

• Expect renewal spreads to remain in the mid to high single digits for the remainder of 2024 and into next year.

• The Marlstone residential project in Halifax is on schedule for completion in H1 2026.

• Continued focus on operational excellence, modernization, and disciplined capital allocation to drive long-term growth.