Alignvest Student Housing – Q3 2020 Management Report

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SEPTEMBER 30, 2020 – MANAGEMENT REPORT

We are pleased to send you the September 30, 2020 Management Report of Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”).

September is the most important month for our REIT as it is the start of the school year. This year, in particular, with the onset of the “second wave” of the COVID-19 pandemic and uncertainty around university operations, we have been hyper-focused on occupancy and managing the health and safety of our tenants and employees. We are pleased that the majority of students showed up, are occupying their units, are excited to partake in the university experience, and are paying rent on time.

We are cautiously optimistic that our occupancy figures will continue to improve in the coming quarters with the recent announcement by the government to allow international students to enter Canada as of October 20, 2020.

Please let us know if you have any questions.

Click the link below for the September 2020 update.

Management Report

Alignvest Student Housing – Update

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ASH Unitholders,

September 1st is a very important date for our student housing assets. Most of our leases run on a September – September term. We wanted to provide some real time information as to how September appears to be going. The following attachment gives some raw numbers of our current portfolio. We wanted to provide some additional information in order to help best understand theses numbers and what they mean:

 

  • Our overall portfolio is 85%+ leased for the year. This is well above our estimated breakeven occupancy of 65%.
  • There is ONE building in our portfolio that is managed by a University. This is the annex building in Ottawa. The Annex has been recognized as the best building in the Universities portfolio and is the most occupied building. Its current occupancy is 57%. This is expected to be the case for at least the first term. Generally this building is fully occupied with a long waiting list.
  • We continue to be operating in a positive cash flow environment and we have plenty of cash on our balance sheet to weather any storm or take advantage of an opportunity to acquire quality assets.
  • At this point in time, management sees no reason to cut the distributions to unitholders and therefor distributions will continue.

 

See the below update:

 

Flash Report

Alignvest Student Housing – June 30, 2020 – Management Report

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We are pleased to send you the June 30, 2020 Management Report of Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”).

Throughout Q2 2020, the uncertainty with respect to COVID-19 has subsided with universities announcing their plans for the Fall 2020 term and our properties continuing to perform strongly. Our revenue collection stands at approximately 95% and our pre-leasing is approaching 90%. With this stability in place, we have shifted our focus on acquisition opportunities.

We recently announced the acquisition of our first property in Western Canada, 1Ten on Whyte in Edmonton, which transforms us into a truly national player in the institutional-grade, purpose-built student accommodation space. We have also re-engaged on several additional attractive acquisition opportunities worth upwards of $500 million.

 

Below is the link to our Management Report.

 

June 30, 2020 - Management Report

 

Alignvest Student Housing – Q1 2020 Management Report

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We are pleased to highlight the March 31, 2020 Management Report from Alignvest Student Housing Real Estate Investment Trust (“ASH REIT”).

On March 11, 2020, the World Health Organization declared COVID-19 a pandemic. In response, we immediately paused on the multiple acquisitions we were working on and shifted our focus to mitigate the impact of the pandemic to our employees and tenants, and to ASH REIT’s broader business. We are pleased to report that we are on track to collect approximately 95% of April rents, and expect similar outcomes over the summer months.

Recently, the Canadian universities began announcing their plans for September 2020; we have provided an update on what we know and are shifting our operating focus to respond to an expected primarily online environment for the Fall term.

Amidst this uncertainty, we are starting to see some attractive opportunities emerge. With operations largely stabilized, we expect to resume our focus on completing accretive transactions over the coming months and we believe that there will be an opportunity to transact at attractive valuations.

Below is the link to our Management Report. In addition, we will be hosting a conference call to discuss our performance and outlook on Thursday, May 28, 2020 at 2:00 PM EDT – please register for the call using the link below.

Please let us know if you have any questions. Stay safe and take care

 

Management Report

 

 

We recently completed renovations and relaunched our property in Oshawa as “17Hundred”. We have updated the lobby area (pictured) and all common areas to match modern design trends and better compete with other student housing properties in the market.

Alignvest Student Housing – Flash Report

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Please find below the most recent update on Alignvest Student Housing. Management wanted to share the latest numbers regarding the lease up for the 2020/2021 school year and the collection of April rents. In summary, we are ahead of where we were last year with respect to leasing for the upcoming school year. Our properties are proving to be highly desirable and some of the feedback received has been that higher quality properties are even more in favour during these times of uncertainty. With respect to April rents, we are tracking to get over 97% of rent cheques. Although lower than usual, it is still far above any amount that would have management concerned about cash flow.

 

COVID-19 Flash Report

Student Housing Major Milestone Achieved

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We are back at it again. We have lined up another exciting acquisition. The current acquisition adds a tremendous amount of value and is completely transformational. The following key things will be accomplished with this acquisition;

  1. Adds 4 new buildings that are located near tier one Universities in Canada. This brings our total to 7 Buildings and over 3,300 beds. We are now the largest owner operator of Purpose Build Student Housing “PBSA” in Canada.
  2. Diversifies the REITs asset base to more markets that now include a strong hold in Waterloo and Ottawa as well as a presence in both Hamilton and Oshawa.
  3. We will undoubtedly have the highest quality portfolio in Canada with almost all of our buildings being less than 10 years old.
  4. The price we have paid for all of these buildings still is projected to generate a 15%+ IRR (rate of return)/annum.

We are currently raising $75 million of equity to fund the acquisition. We would encourage all unitholders to make an additional investment as this transformational acquisition substantially de-risks the student housing strategy. We will have over $350 million of property in the portfolio and be well ahead of schedule in the accumulation of Student Housing in Canada. We also encourage unitholders to refer any new investors they may think would be interested in our strategy.

Executive Summary

ASH REIT is the only investment vehicle focused exclusively on the Canadian Student Housing Market.

ASH REIT is currently focused on the consolidation of the fragmented Canadian PBSA market

Success to date of the REIT has exceeded expectations

  • 3 Class A+ properties in Tier-1 markets worth over $200 million
  • Quality and quantity of available assets
  • Attractive acquisition prices given limited competition (private transactions)
  • Operational upside to properties day-1

Transformational acquisition to close in April 2019

  • Portfolio consisting of 4 properties with 1,992 beds to be acquired for $170 million
  • Similar high-quality assets to current portfolio at an attractive all-in purchase price
  • Diversifies portfolio and positions ASH REIT as the largest owner/operator of PBSA in Canada
  • Unique opportunity to integrate new properties with current asset in Waterloo market
  • Scale will allow ASH REIT to commence movement of property management in-house

ASH REIT is seeking to raise up to $75 million of new equity in Q1/Q2 2019 to fund the Portfolio acquisition and position the REIT for additional high-quality acquisitions in the near-term

  • Sale of units to fund purchase expected to yield annual distributions (mainly return of capital) in excess of 6% to unitholders and long-term returns in excess of 15%
  • Units prices attractive relative to alternative real estate investments

We look forward to updating everyone in April when the transaction closes. Thanks again for your support.

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