Slide 1: Q2-2021 Results Conference Call
Q2-2021 RESULTS August 5th, 2021 | 9AM Eastern CONFERENCE CALL
Slide 2: Cautionary Statement
Q2-2021 | Cautionary Statement This presentation may contain forward- looking statements with respect to Killam Apartment REIT and its operations, strategy, financial performance and condition. These statements generally can be identified by use of forward-looking words such as “may”, ”will”, “expec
Slide 3: Strategic Targets
Q2-2021 | Strategic Targets Grow Same Property NOI Develop High-Quality Properties • 2021 Target: >2%, subject to COVID-19 related • 2021 Target: Complete 166 units (two restrictions being lifted by Q3-2021. buildings) and break ground on two additional • **Revised in Q2-2021: >3.5% developments (>1
Slide 4: Financial Highlights
Q2-2021 | Financial Highlights $136.7M 44.5% $206M Net income Debt to Total Assets Q2 Acquisitions $136.7 million, an increase of $0.27 Flexible capital structure with 4.5% Acquired $271 million in $115.2 million from Q2-2020 FFO per Unit Growth a conservative balance sheet. Same Property NOI acquis
Slide 5: Financial Highlights: FFO and Same Property NOI Growth
Q2-2021 | Financial Highlights Strong FFO and Same Property NOI Growth due to rental rate growth, improved occupancy and modest expense growth. Q2 FFO & AFFO Per Unit Same Property Portfolio Performance For the three months ended June 30, 2021 Q2-2021 Q2-2020 $0.27 $0.26 $0.23 $0.22 4.0% 3.3% 4.5% F
Slide 6: Financial Highlights: Same Property Performance
Q2-2021 | Financial Highlights Apt Same Property Avg Apt Same Property Apt Same Property Rental Rate Increase Occupancy(1) Incentive Offerings(2) 96.1% 96.9% 97.0% 96.7% 96.9% 1.6% 2.4% 3.2% 2.9% 3.1% 0.8% 0.4% 0.4% 0.4% 0.7% Q2-2017 Q2-2018 Q2-2019 Q2-2020 Q2-2021 Q2-2017 Q2-2018 Q2-2019 Q2-2020 Q2
Slide 7: Revenue - Renovations
Q2-2021 | Revenue - Renovations Revenue growth through unit repositions to meet market demand to optimize NOI growth and investment returns. YTD-2021 Actuals • 287 unit repositions • 13% ROI • $25k avg investment 2021 Program • 550 unit repositions • ~$14-16M investment • ~$1.8-2.0M annualized reven
Slide 8: Financial Highlights: Same Property Expense Growth
Q2-2021 | Financial Highlights Same Property Expense Growth Increased operating expenses and a modest increase in heating fuel and utility expenses for Q2. This was partially offset by 3.1% 3.3% property tax expense savings to generate a 3.3% increase in Q2- 2.7% 2021. 0.9% • General Operating expen
Slide 9: Apartment Mortgage Maturities by Year
Q2-2021 | Financial Highlights Apartment Mortgage Maturities by Year As at June 30, 2021 Mortgage Maturities Weighted Average Interest Rate (Apartments) Current Weighted Five-year CMHC rate Ten-year CMHC rate Average Interest Rate $600 $525 3.19% 4% 2.61 % Mortgage Maturities ($M) $450 2.68% 2.85% 2
Slide 10: Debt as a % of Assets
Q2-2021 | Financial Highlights Increasing value of investment properties with conservative debt metrics. Debt as a % of Assets Interest Coverage Ratio Debt to Normalized % EBITDA 0% % 0% 10.51 10.50 10.62 10.15 10.78 11.11 53.5% 48.7% 49.8% 43.4% 44.6% 44.5% 2.70 3.13 3.22 3.20 3.36 3.44 % 10
Slide 11: Focusing on Long-Term Growth Drivers
Q2-2021 | Focusing on Long-Term Growth Drivers Best-in-class multi-family residential owner, operator and developer NOI Contribution by Market (%) AB | 7% NL | 4% Calgary | Edmonton St. John’s BC | 3% PEI | 6% Victoria Charlottetown ON | 22% NS | 38% Ottawa | London NB | 20% Halifax Toronto | KWC Mo
Slide 12: Portfolio Acquisition in Kitchener-Waterloo: The Estates
Q2-2021 | Portfolio Acquisition in Kitchener-Waterloo Focused on diversifying the portfolio geographically, a 785-unit portfolio in KWC was purchased on June 30, 2021. Acquisition Details: $190.5 million The Estates | Kitchener 3.5% capitalization rate 137 units | Avg 865 SF | 99% occupied $123.9 mi
Slide 13: Heritage Place | Kitchener
Q2-2021 | Portfolio Acquisition in Kitchener-Waterloo Heritage Place | Kitchener 160 units | Avg 1,084 SF | 100% occupied Avg Mth Rent $1,197 per unit ($1.10/SF) 13
Slide 14: Northfield Gardens | Waterloo
Q2-2021 | Portfolio Acquisition in Kitchener-Waterloo Northfield Gardens| Waterloo 274 units | Avg 800 SF | 100% occupied Avg Mth Rent $1,195 per unit ($1.49/SF) 14
Slide 15: Ridgeway & Somerset | Kitchener
Q2-2021 | Portfolio Acquisition in Kitchener-Waterloo Ridgeway & Somerset | Kitchener 214 units | Avg 740 SF | 99% occupied Avg Mth Rent $1,169 per unit ($1.58/SF) 15
Slide 16: Portfolio Acquisition in Kitchener-Waterloo
Q2-2021 | Portfolio Acquisition in Kitchener-Waterloo KWC region is a strong economic hub that will continue to be a main driver of growth for Killam. 2020 Assets Newly Acquired Assets (Jun 2021) Future Development Growth Expected Future Growth 2020 Today ~2,500 units + 297,000 SF Commercial with th
Slide 17: Acquisition in Charlottetown
Q2-2021 | Acquisition in Charlottetown Charlottetown Mall $10.1 million (Additional 25% acquired) Ownership: 75% Killam/25% PEI operator* Closed June 1, 2021 352,000 SF enclosed mall; 32 acres 60,000 SF vacant space Opportunities with local and diverse leasing, development and improved o
Slide 18: Acquisitions
Q2-2021 | Acquisitions Annual Acquisitions ($ millions) $315 Average $122M $271 $200 $200 $211 $160 $191 $167 $125 $115 $106 $121 $103 $85 $72 $16 $45 $36 $3 $54 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 YTD 2021 NOI Generated Outside Atlantic Can
Slide 19: Strong Leasing of Developments
Q2-2021 | Strong Leasing of Developments Shorefront Leasing Activity (as of July 28, 2021) 99% Shorefront | 78 units | Charlottetown, PE 100% 75% 50% 25% 0% Month Month Month Month Month Month Month Month Month Month Month 1 2 3 4 5 6 7 8 9 10 11 Month from Opening Date (Oct 2020) Nolan Hill | 233 u
Slide 20: Strong Leasing of Developments: Margins and NOI
Q2-2021 | Strong Leasing of Developments Shorefront | 78 units | Charlottetown, PE These newly completed developments contributed $0.3 million to FFO in Q2-2021 with further FFO growth throughout the remainder of 2021 once fully leased in Q3-2021. Operating Margin % (Stabilized) 73% 70% 70% 68% Kill
Slide 21: Development Progress
Q2-2021 | Development Progress With Shorefront, Harley Developments - Scheduled and Nolan Hill now open, Completion Killam currently has five developments underway, 2021-2022 which will add an $millions additional 497 units to $200 128 units | Mississauga, ON Killam’s portfolio by the Total $180M |
Slide 22: Development Activity - Mississauga
Q2-2021 | Development Activity - Mississauga THE KAY, 128-unit development broke ground in Q3-2019 and is expected to be completed in Q4-2021. Key Statistics Progress shots as of June 2021 Number of units 128 Start date Q3-2019 Est. completion date Q4-2021 Project budget ($M) $57.0 Cost per unit $44
Slide 23: Development Activity - Ottawa: The Latitude
Q2-2021 | Development Activity - Ottawa THE LATITUDE, 209-unit development Progress shots as of June 2021 Key Statistics Number of units 209 Start date Q2-2019 Estimated completion date Q1-2022 Project budget ($M)(1) $43.5 Cost per unit $416,000 Expected yield 4.4%-4.6% Expected value cap-rate 3.5%
Slide 24: Development Activity - Ottawa: Luma
Q2-2021 | Development Activity - Ottawa LUMA – 168-unit development in Ottawa 50/50 with RioCan REIT. Progress shots as of July 2021 Key Statistics Number of units 168 Estimated completion date Q2-2022 Project budget ($M)(1) 44.3 Cost per unit $527,000 Expected yield 4.0%-4.25% Avg rent $2.90 per SF
Slide 25: Development Activity - Kitchener
Q2-2021 | Development Activity - Kitchener CIVIC 66 – 169-unit development in Kitchener that broke ground in Q3-2020 and is expected to be completed by Q4-2022. Key Statistics NumberLatitude of units (Phase II) 169 Start date Q3-2020 Est. completion date Q4-2022 Project budget ($M) $69.7 Cost per un
Slide 26: Development Activity - Halifax
Q2-2021 | Development Activity - Halifax THE GOVERNOR - 12 luxury units and 3,500 square foot ground floor commercial development in downtown Halifax. Key Statistics Number of units 12 Start date Latitude (Phase II) Q1-2021 Est. completion date Q3-2022 Project budget ($M) $22 Expected yield 4.25%-4.
Slide 27: Development Activity - Halifax
Q2-2021 | Development Activity - Halifax THE GOVERNOR, 12-unit development broke ground in early 2021 and is expected to be completed in Q3-2022. Latitude (Phase II) * Killam’s 50% interest. 27
Slide 28: Development Activity - Halifax: Interior Suite Rendering
Q2-2021 | Development Activity - Halifax THE GOVERNOR, interior suite rendering, average suite size 2,350 SF 28
Slide 29: Development Activity - Halifax: Interior Suite Rendering
Q2-2021 | Development Activity - Halifax THE GOVERNOR, interior suite rendering, average suite size 2,350 SF 29
Slide 30: Future Development Activity - Westmount Phase 1
Q2-2021 | Future Development Activity – Westmount Phase 1 WESTMOUNT PHASE 1 – Expect to break down on the 139-unit development in Waterloo in Q4-2021. Key Statistics Number of units 139 Est. start date Q4-2021 Est. completion date Q1-2024 30
Slide 31: Development Pipeline - ~$1.3 billion
Q2-2021 | Development Pipeline - ~$1.3 billion Future Development Opportunities Killam’s Potential # Est Year of Property Location Interest of Units(1) Status Completion Developments expected to start in 2021 Nolan Hill (Phase 2)(2) Calgary, AB 10% 234 Detailed design, preparing submission 2024 West
Slide 32: Non-IFRS Measures
Non-IFRS Measures Non-IFRS Measures Management believes these non-IFRS financial measures are relevant measures of the ability of the REIT to earn revenue and to evaluate Killam's financial performance. The non-IFRS measures should not be construed as alternatives to net income or cash flow from ope
Slide 33: Q2-2021 Results Conference Call
Q2-2021 RESULTS CONFERENCE CALL August 5th, 2021 | 9AM Eastern