A growing portfolio and new leases drove earnings at Ottawa’s Minto Apartment REIT past the forecasts it set for this past quarter before going public last summer.
Minto REIT’s funds from operations for the three months ending March 31 were $7.3 million, 13.1 per cent higher than forecasted figures. Total revenue from the company’s property portfolio was $22.1 million in the quarter, compared with a forecast of $20.4 million.
The main driver of Minto REIT’s growth are properties acquired in Calgary across the previous two quarters, in addition to higher occupancy in its apartments and lease turnovers. The REIT signed 247 new leases in the past quarter, which increased average monthly rent on the suites by 8.4 per cent as the rental rates catch up with current market levels.
In a release, the REIT’s management said it estimates an additional 4,234 suites in its portfolio have an average of 9.7 per cent gain-to-lease potential, which if executed on could yield annualized revenues of approximately $7 million.
Following the end of the quarter, Minto announced it had acquired 50 per cent stakes in two sets of properties in Montreal and Toronto. In order to finance the deals, which are worth a combined $209 million, Minto REIT raised $173 million in a unit offering and announced it would take on mortgage loans totalling $158.5 million.