Killam Apartment REIT (KMP-UN) Q4 2025 earnings summary

Executive summary

• Achieved 6.1% same property NOI growth in 2025, driven by 5.4% revenue growth in apartments, 7.8% in MHC, and 4.4% in commercial properties, exceeding strategic targets.

• Net income for 2025 was $29.4 million, down $638 million year-over-year, mainly due to $120.5 million in fair value losses and the absence of a prior year deferred tax recovery.

• FFO per unit increased 4.2% to $1.23; AFFO per unit rose 5.1% to $1.04; AFFO payout ratio improved to 69%.

• Completed $148.3 million in non-core asset dispositions and redeployed capital into $168.8 million in acquisitions and ongoing developments.

• The Carrick development in Waterloo was substantially completed and is now 95% leased; new projects in Waterloo and Halifax are progressing.

Financial highlights

• Property revenue rose 5.1% year-over-year to $383.4 million, with NOI up 6.0% to $254.8 million.

• Q4-2025 same property NOI rose 4.5% year-over-year; Q4 FFO per unit increased 3.4% to $0.30.

• Weighted average rental increase of 4.8% across the same property portfolio.

• Debt as a percentage of total assets was 41.9% at year-end, up from 40.4% in 2024; debt to normalized EBITDA improved to 9.66x.

• Interest coverage ratio was 2.93x for 2025.

Outlook and guidance

• Targeting at least 3% revenue and NOI growth for the same property apartment portfolio in 2026.

• Atlantic markets expected to outperform in 2026, with a portfolio-wide mark-to-market spread of up to 15%.

• Interest expense growth expected to stabilize by 2027, with more NOI flowing to FFO.

• Disposition target for 2026 is a minimum of $50 million in assets.

• Ongoing focus on energy efficiency, capital recycling, and maintaining debt below 42% of total assets.