Welcome!

News Feed Item

Brookfield Canada Office Properties Reports Fourth Quarter and Full-Year 2012 Results

TORONTO -- (Marketwire) -- 01/28/13 -- Brookfield Canada Office Properties (TSX: BOX.UN) (NYSE: BOXC), a Canadian REIT (Real Estate Investment Trust), today announced that net income for the year ended December 31, 2012 was $527.5 million or $5.66 per unit, compared to $355.4 million or $3.81 per unit in 2011. Net income for the three months ended December 31, 2012 was $165.6 million or $1.78 per unit, compared to $216.9 million or $2.33 per unit during the same period in 2011. Included in net income for the year ended December 31, 2012 was a fair value gain of $388.5 million, compared to $229.3 million in 2011. IFRS value increased to $32.57 per unit at the end of 2012 from $28.01 per unit at the end of 2011.

Funds from operations ("FFO") for the year ended December 31, 2012, was $139.0 million or $1.49 per unit, compared with $127.0 million or $1.36 per unit in 2011. FFO for the three months ended December 31, 2012, was $35.9 million or $0.39 per unit, compared with $33.1 million or $0.36 per unit during the same period in 2011. Adjusted funds from operations ("AFFO") was $107.4 million or $1.15 per unit for the year ended December 31, 2012, compared to $95.4 million or $1.02 per unit in 2011. AFFO was $28.0 million or $0.30 per unit for the three months ended December 31, 2012, compared to $25.5 million or $0.27 per unit during the same period in 2011.

Commercial property net operating income for the year ended December 31, 2012 was $269.2 million, compared with $234.6 million in 2011. Commercial property net operating income for the three months ended December 31, 2012 was $68.5 million, compared with $62.3 million during the same period in 2011. The Trust achieved same-store net operating income of $240.8 million in 2012, an increase of $11.0 million over 2011. Same-store net operating income was $61.4 million for the three months ended December 31, 2012, an increase of $2.9 million over the same period in 2011.

HIGHLIGHTS OF THE FOURTH QUARTER

Continuing its pro-active leasing strategy, Brookfield Canada Office Properties leased 331,000 square feet of space during the fourth quarter of 2012. The significant leasing efforts during the quarter brought the Trust's full-year leasing total to 1.34 million square feet.

The Trust's occupancy rate finished the year at 96.9%, down 20 basis points from the prior quarter, but up 70 basis points from year-end 2011. This rate compares favourably with the Canadian national average of 92.8%.

Leasing highlights include:

Toronto - 158,000 square feet

  • A 10-year, 27,000-square-foot renewal with Information and Privacy Commission at Hudson's Bay Centre
  • A five-year, 18,000-square-foot renewal with Toronto Convention & Visitors at Queen's Quay Terminal

Calgary - 157,000 square feet

  • A six-year, 95,000-square-foot renewal with PwC Management Services at Suncor Energy Centre. The lease was extended for another four years subsequent to year-end.
  • A 14-year, 43,000-square-foot new lease with Deloitte Management at Bankers Court
  • A five-year, 12,000-square-foot new lease with Phillips 66 Canada LLC at Bankers Hall

Other - 17,000 square feet

Refinanced debt at HSBC Building, Toronto for $45 million. After repayment of the previous mortgage, the Trust generated net proceeds of $24 million. The new financing has a ten-year term with a fixed interest rate of 4.056% per annum.

Early refinanced debt on Bay Wellington Tower, Toronto for $525 million, subsequent to year-end. After repayment of the previous mortgage, the Trust generated net proceeds of $213 million of which a portion of the proceeds was used to fully repay the Trust's corporate revolver. The new financing has a seven-year term with a fixed interest rate of 3.244% per annum.

Celebrated the completion of the three-year rejuvenation program at First Canadian Place, Toronto, Canada's tallest building. Property improvements include the total recladding of the iconic 72-storey tower's exterior façade, a refurbished main entrance, retail concourse, office lobbies, and common areas. Sustainability and environmental upgrades in association with the rejuvenation effort led to the building being awarded LEED (Leadership in Energy & Environmental Design) - Gold certification for Existing Buildings from the Canadian Green Building Council.

Achieved LEED Gold certification at Suncor Energy Centre and Bankers Hall in Calgary. These sustainability accomplishments reaffirm the Trust's commitment to owning environmentally conscious real estate and lowering the portfolio's carbon footprint as 72% of our portfolio is LEED Gold-certified.

OUTLOOK
"Brookfield Canada Office Properties made great strides over the course of 2012, increasing our portfolio-wide occupancy, refinancing debt at low interest rates, integrating our newly acquired properties in Toronto and Ottawa, and increasing our annual distribution to unitholders by 8 percent," said Jan Sucharda, president and chief executive officer. "Our operating markets remain strong and we will continue to look for opportunities to grow our business and add value for our unitholders in 2013."

Net Operating Income, FFO and AFFO
This press release and accompanying financial information make reference to net operating income, funds from operations ("FFO") and adjusted funds from operations ("AFFO") on a total and per unit basis. Net operating income is defined by the Trust as income from commercial property operations after direct property operating expenses, including property administration costs have been deducted, but prior to deducting interest expense, general and administrative expenses and fair value gains (losses). FFO is defined by the Trust as net income prior to one-time transaction costs, fair value gains (losses), and certain other non-cash items if any. AFFO is defined by the Trust as FFO net of normalized second-generation leasing commissions and tenant improvements, normalized sustaining capital expenditures and straight-line rental income. The Trust uses net operating income, FFO and AFFO to assess its operating results. Net operating income is important in assessing operating performance and FFO is a widely used measure to analyze real estate. AFFO is typically a measure used to asses an entity's ability to pay distributions. The components of net operating income, FFO and AFFO are outlined in the financial information accompanying this press release. Net operating income, FFO and AFFO do not have any standard meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other companies.

Monthly Distribution Declaration
The Board of Trustees of Brookfield Canada Office Properties announced a distribution of $0.0975 per Trust unit payable on March 15, 2013 to holders of Trust Units of record at the close of business on February 28, 2013. Unitholders resident in Canada will receive payment in Canadian dollars and unitholders resident in the United States will receive their distributions in U.S. dollars at the exchange rate on the record date, unless they elect otherwise.

Forward-Looking Statements
This press release contains "forward-looking information" within the meaning of Canadian provincial securities laws and "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the U.S. Securities Exchange Act of 1934, as amended, "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995 and in any applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of the Trust and its subsidiaries, as well as the outlook for the Canadian economy for the current fiscal year and subsequent periods, and include words such as "expects", "anticipates", "plans", "believes", "estimates", "seeks", "intends", "targets", "projects", "forecasts" or negative versions thereof and other similar expressions, or future or conditional verbs such as "may", "will", "should", "would" and "could".

Although the Trust believes that the anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Trust, which may cause the actual results, performance or achievements of the Trust to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: risks incidental to the ownership and operation of real estate properties including local real estate conditions, the ability to enter into new leases or renew leases on favorable terms, dependence on tenants' financial condition, uncertainties of real estate development, acquisition and disposition activity; the impact or unanticipated impact of general economic, political and market factors in Canada; the behavior of financial markets, including fluctuations in interest rates; equity and capital markets and the availability of equity and debt financing and refinancing within these markets; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits therefrom; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the effect of applying future accounting changes; business competition; operational and reputational risks; changes in government regulation and legislation; changes in tax laws, catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts; and other risks and factors detailed from time to time in our documents filed with the securities regulators in Canada and the United States.

Caution should be taken that the foregoing list of important factors that may affect future results is not exhaustive. When relying on the Trust's forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, the Trust undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

Supplemental Information
Investors, analysts and other interested parties can access the Trust's Supplemental Information Package at www.brookfieldcanadareit.com under the Investor Relations/Financial Reports section. This additional financial information should be read in conjunction with this press release.

About Brookfield Canada Office Properties
Brookfield Canada Office Properties is Canada's preeminent Real Estate Investment Trust (REIT). Its portfolio is comprised of interests in 28 premier office properties totaling 20.7 million square feet in the downtown cores of Toronto, Calgary, Ottawa and Vancouver. Landmark assets include Brookfield Place and First Canadian Place in Toronto and Bankers Hall in Calgary. For more information, visit www.brookfieldcanadareit.com.

All dollar references are in Canadian dollars unless noted otherwise.

CONSOLIDATED BALANCE SHEETS

                                         ----------------- -----------------
(Cdn Millions)                           December 31, 2012 December 31, 2011
                                         ----------------- -----------------

Assets
Investment properties                    $         5,090.2 $         4,637.9
Tenant and other receivables                          25.4              17.5
Other assets                                           7.0               7.2
Cash and cash equivalents                             41.0              35.5
                                         ----------------- -----------------
                                         $         5,163.6 $         4,698.1
                                         ----------------- -----------------

Liabilities
Commercial property and corporate debt   $         2,013.0 $         1,980.3
Accounts payable and other liabilities               115.0             106.9

Equity
Unitholders' equity                                  838.1             718.8
Non-controlling interest(1)                        2,197.5           1,892.1
                                         ----------------- -----------------
                                         $         5,163.6 $         4,698.1
                                         ----------------- -----------------
(1)Non-controlling interest represents Class B LP units that are
economically equivalent to Trust units and are required to be presented
separately under IFRS.


CONSOLIDATED STATEMENTS OF INCOME

                                            Three months
(Cdn Millions, except per unit amounts)        ended           Year ended
                                         ----------------- -----------------
                                         12/31/12 12/31/11 12/31/12 12/31/11
                                         -------- -------- -------- --------
Commercial property revenue              $  137.8 $  119.4 $  515.1 $  445.4
Direct commercial property expense           69.3     57.1    245.9    210.8
Investment and other income                     -      0.7        -      1.3
Interest expense                             27.2     24.7    109.3     91.9
General and administrative expense            5.4      5.2     20.9     17.0
Transaction costs                               -      0.9        -      0.9
                                         -------- -------- -------- --------
Income before fair value gains               35.9     32.2    139.0    126.1
Fair value gains                            129.7    184.7    388.5    229.3
                                         -------- -------- -------- --------
Net income and comprehensive income      $  165.6 $  216.9 $  527.5 $  355.4
                                         -------- -------- -------- --------

Net income and comprehensive income
 attributable to:
Unitholders                              $   46.4 $   60.7 $  147.7 $   99.5
Non-controlling interest                    119.2    156.2    379.8    255.9
                                         -------- -------- -------- --------
                                         $  165.6 $  216.9 $  527.5 $  355.4
                                         -------- -------- -------- --------
Weighted average Trust units outstanding     26.1     26.1     26.1     26.1
                                         -------- -------- -------- --------
Net income per Trust unit                $   1.78 $   2.33 $   5.66 $   3.81
                                         -------- -------- -------- --------


RECONCILIATION OF NET INCOME TO FUNDS FROM OPERATIONS

(Cdn Millions, except per Unit
 amounts)                            Three months ended      Year ended
                                     ------------------  ------------------
                                     12/31/12  12/31/11  12/31/12  12/31/11
                                     --------  --------  --------  --------
Net income                           $  165.6  $  216.9  $  527.5  $  355.4
Add (deduct):
Fair value gains                       (129.7)   (184.7)   (388.5)   (229.3)
Transaction costs                           -       0.9         -       0.9
                                     --------  --------  --------  --------
Funds from operations                $   35.9  $   33.1  $  139.0  $  127.0
                                     --------  --------  --------  --------
Funds from operations - unitholders      10.1       9.3      38.9      35.6
Funds from operations - non-
 controlling interest                    25.8      23.8     100.1      91.4
                                     --------  --------  --------  --------
                                     $   35.9  $   33.1  $  139.0  $  127.0
                                     --------  --------  --------  --------
Weighted average Trust units
 outstanding                             26.1      26.1      26.1      26.1
Funds from operations per Trust unit $   0.39  $   0.36  $   1.49  $   1.36
                                     --------  --------  --------  --------


RECONCILIATION OF FUNDS FROM OPERATIONS TO ADJUSTED FUNDS FROM OPERATIONS

(Cdn Millions, except per unit
 amounts)                          Three months ended          Year ended
                                   ------------------  --------------------
                                   12/31/12  12/31/11  12/31/12   12/31/11
                                   --------  --------  --------  ----------
Funds from operations              $   35.9  $   33.1  $  139.0  $    127.0
Add (deduct):
Straight-line rental income            (2.0)     (2.9)     (8.0)      (12.8)
Normalized 2nd generation leasing
 commissions and tenant
 improvements(1)                       (4.5)     (3.8)    (18.0)      (15.2)
Normalized sustaining capital
 expenditures(1)                       (1.4)     (0.9)     (5.6)       (3.6)
                                   --------  --------  --------  ----------
Adjusted funds from operations     $   28.0  $   25.5  $  107.4  $     95.4
                                   --------  --------  --------  ----------
Adjusted funds from operations -
 unitholders                            7.8       7.1      30.1        26.7
Adjusted funds from operations -
 non-controlling interest              20.2      18.4      77.3        68.7
                                   --------  --------  --------  ----------
                                   $   28.0  $   25.5  $  107.4  $     95.4
                                   --------  --------  --------  ----------
Weighted average Trust units
 outstanding                           26.1      26.1      26.1        26.1
Adjusted funds from operations per
 Trust unit                        $   0.30  $   0.27  $   1.15  $     1.02
                                   --------  --------  --------  ----------

(1)As the components used in calculating AFFO vary quarter over quarter, a
normalized level of activity is estimated based on historical spend levels
as well as anticipated spend levels over the next few years. Sustaining
capital expenditures relate to capital items that are required to maintain
the properties in their current operating state and exclude projects that
are considered to add productive capacity.

Contact:
Matthew Cherry
Director, Investor Relations and Communications
Tel: 416.359.8593
Email: Email Contact

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
The vast majority of businesses now use cloud services, yet many still struggle with realizing the full potential of their IT investments. In particular, small and medium-sized businesses (SMBs) lack the internal IT staff and expertise to fully move to and manage workloads in public cloud environments. Speaker Todd Schwartz will help session attendees better navigate the complex cloud market and maximize their technical investments. The SkyKick co-founder and co-CEO will share the biggest challe...
Enterprises are striving to become digital businesses for differentiated innovation and customer-centricity. Traditionally, they focused on digitizing processes and paper workflow. To be a disruptor and compete against new players, they need to gain insight into business data and innovate at scale. Cloud and cognitive technologies can help them leverage hidden data in SAP/ERP systems to fuel their businesses to accelerate digital transformation success.
Dhiraj Sehgal works in Delphix's product and solution organization. His focus has been DevOps, DataOps, private cloud and datacenters customers, technologies and products. He has wealth of experience in cloud focused and virtualized technologies ranging from compute, networking to storage. He has spoken at Cloud Expo for last 3 years now in New York and Santa Clara.
Predicting the future has never been more challenging - not because of the lack of data but because of the flood of ungoverned and risk laden information. Microsoft states that 2.5 exabytes of data are created every day. Expectations and reliance on data are being pushed to the limits, as demands around hybrid options continue to grow.
Machine learning provides predictive models which a business can apply in countless ways to better understand its customers and operations. Since machine learning was first developed with flat, tabular data in mind, it is still not widely understood: when does it make sense to use graph databases and machine learning in combination? This talk tackles the question from two ends: classifying predictive analytics methods and assessing graph database attributes. It also examines the ongoing lifecycl...
While some developers care passionately about how data centers and clouds are architected, for most, it is only the end result that matters. To the majority of companies, technology exists to solve a business problem, and only delivers value when it is solving that problem. 2017 brings the mainstream adoption of containers for production workloads. In his session at 21st Cloud Expo, Ben McCormack, VP of Operations at Evernote, discussed how data centers of the future will be managed, how the p...
Dion Hinchcliffe is an internationally recognized digital expert, bestselling book author, frequent keynote speaker, analyst, futurist, and transformation expert based in Washington, DC. He is currently Chief Strategy Officer at the industry-leading digital strategy and online community solutions firm, 7Summits.
Wooed by the promise of faster innovation, lower TCO, and greater agility, businesses of every shape and size have embraced the cloud at every layer of the IT stack – from apps to file sharing to infrastructure. The typical organization currently uses more than a dozen sanctioned cloud apps and will shift more than half of all workloads to the cloud by 2018. Such cloud investments have delivered measurable benefits. But they’ve also resulted in some unintended side-effects: complexity and risk. ...
With 10 simultaneous tracks, keynotes, general sessions and targeted breakout classes, @CloudEXPO and DXWorldEXPO are two of the most important technology events of the year. Since its launch over eight years ago, @CloudEXPO and DXWorldEXPO have presented a rock star faculty as well as showcased hundreds of sponsors and exhibitors! In this blog post, we provide 7 tips on how, as part of our world-class faculty, you can deliver one of the most popular sessions at our events. But before reading...
If a machine can invent, does this mean the end of the patent system as we know it? The patent system, both in the US and Europe, allows companies to protect their inventions and helps foster innovation. However, Artificial Intelligence (AI) could be set to disrupt the patent system as we know it. This talk will examine how AI may change the patent landscape in the years to come. Furthermore, ways in which companies can best protect their AI related inventions will be examined from both a US and...
In this presentation, you will learn first hand what works and what doesn't while architecting and deploying OpenStack. Some of the topics will include:- best practices for creating repeatable deployments of OpenStack- multi-site considerations- how to customize OpenStack to integrate with your existing systems and security best practices.
Charles Araujo is an industry analyst, internationally recognized authority on the Digital Enterprise and author of The Quantum Age of IT: Why Everything You Know About IT is About to Change. As Principal Analyst with Intellyx, he writes, speaks and advises organizations on how to navigate through this time of disruption. He is also the founder of The Institute for Digital Transformation and a sought after keynote speaker. He has been a regular contributor to both InformationWeek and CIO Insight...
Behera Rasananda is a technologist, a leader, a key note speaker has more than 20 years experience in across Government, Financial, Heath Care and Insurance Verticals. Mr. Behera has vast experience in Enterprise Cloud and Big Data solutions and Enterprise Architecture. Currently he works closely for Government Solutions on Enterprise Cloud for Federal Government Agency. Scientist Behera managed and partner with clients to make complete end to end solution and Migration to cloud both private sec...
Everyone wants the rainbow - reduced IT costs, scalability, continuity, flexibility, manageability, and innovation. But in order to get to that collaboration rainbow, you need the cloud! In this presentation, we'll cover three areas: First - the rainbow of benefits from cloud collaboration. There are many different reasons why more and more companies and institutions are moving to the cloud. Benefits include: cost savings (reducing on-prem infrastructure, reducing data center foot print, r...
They say multi-cloud is coming, but organizations are leveraging multiple clouds already. According to a study by 451 Research, only 21% of organizations were using a single cloud. If you've found yourself unprepared for the barrage of cloud services introduced in your organization, you will need to change your approach to engaging with the business and engaging with vendors. Look at technologies that are on the way and work with the internal players involved to have a plan in place when the ine...