Alignvest Student Housing – Announcement

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ALIGNVEST STUDENT HOUSING ACQUIRES HIGH-QUALITY STUDENT HOUSING ASSET IN HALIFAX, NOVA SCOTIA

 

We are pleased to announce that Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”) has completed the acquisition of a purpose-built student accommodation (“PBSA”) asset known as See-More, located at 1402-1424 Seymour Street in Halifax, Nova Scotia.

See-More is a six-floor, newly constructed student housing facility located steps away from Dalhousie University. See-More is one of only a few purpose-built student housing properties serving Dalhousie University and is 100% leased for the 2022/23 academic year.

See-More is equipped with 491 beds in 141 fully furnished units, including studios, three-, four- and five-bedroom suites, which provides a wide variety of configurations for potential tenants. Additionally, See-More features several student-oriented amenities, including a yoga and wellness studio, games room, on-site laundry facilities, social rooms, common study areas and an underground parking garage.

This strategic acquisition further diversifies ASH REIT’s portfolio and solidifies the REIT’s position as the leading owner and operator of Canadian PBSA. With this acquisition, ASH REIT owns in excess of 5,200 student housing beds across Canada. Further, this acquisition marks ASH REIT’s entry into Atlantic Canada, which is home to several universities and colleges in need of housing for their students. We look forward to further growth in the Maritimes.

Below is the link to the press release announcing the acquisition.

Press Release Announcement

Alignvest Student Housing Q2 – Management Report

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We are pleased to send you the June 30, 2022 Management Report of Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”).

We continue to experience high inflation in Canada, with the inflation rate rising to 8.1% in June 2022. We are seeing that student housing provides very effective protection against inflation due to the natural, high turnover of student leases. For the 2022/2023 academic year, we are executing leases at rental rates that are 3% to 23% higher than the previous year. We also continue to experience very strong pre-leasing, with our portfolio being over 94% leased for September 2022 (compared to 76% at this time last year). The demand for high quality beds continues to be very strong and our portfolio is performing as expected.

 

In response to high inflation, the Bank of Canada continues to increase benchmark interest rates. We are pleased to have stable and attractive financing in place, with no material near-term financing requirements. With respect to potential acquisitions, we have been building up a robust cash reserve on our balance sheet to focus on acquiring strategic, high-quality acquisitions. We are seeing previously unavailable properties become available for purchase, providing us with the potential opportunity to further expand our portfolio across new markets.

Below is the link to our Management Report. Please contact us if you have any questions or need additional information

Management Report

Wright-Parkway Winter/Spring LP Update

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Operational Update

Occupancy remains strong in our two facilities in Nova Scotia. When you combine the two reports below, the percentage of units rented between the two facilities is 89.6%. If you look at the square footage, we are currently leasing out 94% of all space available. This is considered quite high for storage and Wright in particular is in need of more space with over 97% of available area currently rented!

 

 

Financial Update Q1 2022

2021 was a solid year for both facilities. Our revenue for the year was $1,631,116 over 10.5 months of operation with monthly revenues increasing 10-20% over the course of the year. The Q1 numbers, as noted below, show this growth trend continuing with $500,000 of revenue in the first quarter of 2022. This puts Wright-Parkway on track to surpass $2M in revenue for 2022.

 

 

  • The GP declared a second Distribution of $198,000 to LP unitholders in May, 2022
  • Combined distributions paid to investors since February 2021 totals $518,904 or almost 8% on equity in just over 1 year

Management is now looking at expansion options for the Wright facility. This expansion could add 4 to 6 stories and up to 60,000 Sq Ft of much needed space to this facility. Management believes the net gain in value for Wright from such an expansion could be significant

 

Chestermere Winter/Spring Self-Storage LP Update

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Operational Update

 

Leasing up a storage facility during winter months is a bit out of the norm. We were very happy to see this trend continue while also having 11 people on the waiting list for larger units, which will help with our lease up once our expansion is complete.

 

 

Financial Update

We have completed our 2021 year end and T5013s were sent to all investors at the end of March. 2021 was a great growth year for Chestermere and we ended the year at 69.9% storage occupancy with total revenues of $875,903. This represents a 47.42% increase in revenue YoY from our 2020 total of $594,161. Excluding amortization, Chestermere was profitable in 2021 – a very significant step for the LP.

 

 

As, you can see from the above YTD management reports, 2022 continues to show growth. The first quarter is typically very slow for storage, but revenue has continued to grow and occupancy as well. Chestermere is currently over 80% occupied!

 “Summer 2021 appraisal (after expansion) – Colliers $20,140,00 with roughly $8M in debt on property”

 

  • Our main goal in 2022 is to complete the planned expansion for Chestermere. Management believes the additional space will maximize revenue and position Chestermere for a potential exit in 2023

 

  • Phase 2 is expected to add ~28,000 Sq Ft net rentable and over $700,000 in gross annual revenue potential

Dufferin LP Winter/Spring Update

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Car and Truck Wash Update

 

  • As mentioned previously, 2021 saw a substantial retrofit for the wash which was necessary to set GWD up for long term success

 

  • Gross revenue in 2021 was $2,177,358 vs. $1,771,220 in 2020. This represents a 23% YoY increase despite Dufferin being down 1 truck bay most of the year and lingering COVID issues

 

  • In 2022 we continue to improve the wash. Projects include adding side blasters to our express tunnel to improve wash quality while reducing prep time; adding a new injection system which will reduce our chemical use by over 25%; and adding foam cannons to our other two truck bays as they are much in demand

 

  • The hard work has been paying off with Q1 revenues coming in just over $750,000 (a 30% YoY increase from Q1 last year) with an estimated EBITDA of ~$270,000

 

Our main focus for the remainder of 2022 will be continuing to grow our Shark Club members along with B2B revenue while reducing costs

 

 

Self-Storage Update

 

Dufferin Storage had a strong 2021, finishing the year at ~40% occupancy and operational break even. This is exceptional for a storage asset to achieve in less than 1.5 years.

This strong lease up trend continues in 2022. Dufferin is currently at 45.6% occupancy after an exceptional Q1. Although official targets are lower, management and our facility manager Bluebird have set a stretch goal of 60% occupancy for year end.

Revenues continue to increase and Dufferin Storage is now starting to eat into its debt coverage – a very promising sign. Management believes that full profitability is achievable by year end if Dufferin continues its strong lease up trend.

 

Financial Update

Management completed the 2021 year end and audit for Dufferin LP in April of this year. The audit is being sent out to all investors and an AGM will be scheduled for later this spring.

Our goals for 2022 are to focus on membership growth and profitability for Dufferin Wash, to achieve 60% occupancy and full break even for Dufferin Storage, and to hopefully be able to begin distributions to investors by the end of 2022.

 

Alignvest Student Housing – Q1 2022 Management Report

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We are pleased to send you the March 31, 2022 Management Report of Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”).

We are currently experiencing high inflation in Canada, with the inflation rate rising to 6.7% in March 2022. We are seeing that student housing provides very effective protection against inflation due to the natural, high turnover of student leases. While we are still in the midst of our pre-leasing season, we are executing leases at higher than budget rates and expect to achieve strong year-over-year growth in rents. Further, we continue to experience strong demand for our beds, with our pre-leasing  for September 2022 currently 16% ahead of last year at this time. We expect to have another year of strong occupancy next year, consistent with our current occupancy of 98%.

In response to high inflation, the Bank of Canada increased its benchmark interest rate by 50bps on April 13, 2022 and has indicated that further rate hikes should be expected. This, combined with the uncertainty from Russia’s invasion of Ukraine, has created a volatile financing environment, with base rates and lender spreads increasing. We are pleased to have stable and attractive financing in place, with no material near-term financing requirements. With respect to potential acquisitions, we have been building up a robust cash reserve on our balance sheet to capitalize on the expected opportunities that may arise over the next few months.

Even in an inflationary and volatile financing environment, there continues to be strong interest in the student housing sector both nationally and globally. On April 19, 2022, Blackstone announced the acquisition of American Campus Communities, the largest owner/operator of student housing in the United States, for ~USD$13 billion, demonstrating the continuing confidence in the sector.

Below is the link to our Management Report.

Management Report

Alignvest Student Housing – Q4 2021 Management Report

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DECEMBER 31, 2021 – MANAGEMENT REPORT

We are pleased to send you the December 31, 2021 Management Report of Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”).

We are proud of ASH REIT’s achievements in 2021. We finished the year with three transformative acquisitions, which increased the REIT’s asset base by 1,323 beds and over $215 million in asset value; we maintained near-full occupancy and very attractive collection rates across the portfolio through another year under COVID-19; and we have experienced positive leasing and operational results which have set the foundation for a successful 2022/23 academic year. With these achievements, we were able to deliver a net return of 12.1% in 2021, and an annualized return since inception of 11.1% (applicable to Class F unitholders, assuming DRIP participation).

While we are currently persevering through another wave of the COVID-19 pandemic, we remain optimistic that the impacts on the economy and student demographic will not hinder our operations, similar to the prior two years. We are at 98% occupancy and we expect our buildings to have near-full physical occupancy as students return to campus over the next several weeks.

Student housing continues to prove itself to be a resilient asset class and we remain excited about the outlook for the sector. Following a successful fundraising period in Q4 2021, we are now focused on acquiring additional properties in 2022 to continue to build on our track record of delivering attractive risk-adjusted returns to our investors.

Below is the link to our Management Report. Please contact us if you have any questions or need additional information.

Management Report

StoreWest Dufferin LP – Q3 2021 Update

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Car and Truck Wash Update

• Retrofit of the Automatic Truck bay is complete. New foam cannons and brushes are a big hit. Significant amount of maintenance fixes completed year-to-date.

• Memberships continue to grow with over 1300 members currently. This is up from ~700 members at start of year. We now have over 165 fleet clients as well.

• Sales in the overall car/truck wash are up 33% YoY. We have also dropped our labour by close 20% this year, while getting our chemical cost down as well.

Self-Storage Update

Dufferin Storage celebrated its first anniversary at the end of August. The facility achieved 35% occupancy in its first year – well ahead of projections (20% is considered normal).

At its current level of occupancy the storage facility is essentially at operational breakeven (an impressive feat in one year).

Storage is now entering the quieter period (Nov. – March), but management will continue to focus on financial occupancy while looking forward to the 2022 lease up season.

*Please note our pricing vs our competitors below

 

 

Financial Update

 

Management is currently working with our lender on terming out the construction loan for Dufferin Storage. As part of this process, updated appraisals were obtained on both the storage and wash from Colliers.

Colliers appraised the wash at $15.1M and storage at $28.3M (as is). This provides a total project appraisal of $43.4M with a total project cost of ~$29M (~$14.4M gain on $11M equity). While this is no guarantee of exit value it is encouraging.

Alignvest Student Housing – Q1 2021 Management Report

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MARCH 31, 2021 – MANAGEMENT REPORT

 

We are pleased to send you the March 31, 2021 Management Report of Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”).

Throughout Q1 2021, we continued to focus on operations and growth while maintaining the health and safety of our team and residents at our properties. With the roll-out of vaccines in Canada and our universities issuing “return-to-campus” announcements for Fall 2021, we are starting to see signs of a return to normalcy in Canada.

We expect that high-quality accommodations will be in demand as students return to campus. With this in mind, we completed a strategic acquisition of two properties in Waterloo that added 795 beds to our portfolio, and we have secured another attractive acquisition in Ottawa with over 500 beds that we expect to close in early Q3 2021. With these acquisitions completed, our assets will be valued at over $650 million. We are continuing to raise equity capital to fund these acquisitions.

Below is the link to our Management Report. In addition, below is a link to our recently issued 2020 audited financial statements. We have included enhanced financial disclosure and commentary in this report. Please contact us if you have any questions or need additional information.

 

March 31, 2021 - Management Report

2020 Audited Financial Statements

 

 

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