Retrocom Mid-Market Real Estate Investment Trust

Retrocom Mid-Market Real Estate Investment Trust

May 12, 2008 21:49 ET

Retrocom Mid-Market REIT Announces First Quarter 2008 Financial Results

TORONTO, ONTARIO--(Marketwire - May 12, 2008) -


Attention Business/Financial Editors

Retrocom Mid-Market Real Estate Investment Trust (the "REIT")(TSX:RMM.UN) announced today its financial results for the First Quarter of 2008.

2008 Highlights

- The REIT has entered into lease transactions with new tenants for 104,049 square feet of space occupying in 2008. At March 31, 2008, the REIT's occupancy rate has decreased to 90.9% from 91.5% in Q4-2007 mainly as a result of temporary tenants vacating after the holiday season. While surrendered space may increase prior to the new space occupying, the number of new tenants already committed with occupancy in 2008 is positive. Recently, the REIT received the five year renewal of Wal-Mart anchor tenant space at the Chilliwack Mall which will now expire in late 2013.

- On April 30, 2008 the REIT announced a purchase agreement for $55 million of assets in the Greater Toronto Area ("GTA") through the assumption of debt and the issuance of equity, resulting in a change of effective control of the REIT, (approximately 38% represented by one investor). In addition, SmartCentres will become property manager for substantially all of the REIT's portfolio. (see April 30, 2008 press release for more details of the transaction which is subject to unitholder approval)

- Funds From Operations ("FFO") were consistent with the first quarter of 2007 at $2.7 million. Increases from the purchase of the remaining 50% of two co-owned properties, lower debt and trust expenses were offset by FFO in 2007 generated by the discontinued assets.

- The REIT's average cost of debt is 6.0%, consistent with the year end, and its leverage ratio is a conservative 58.3% inclusive of all debentures and mortgages. At quarter end, the REIT had cash on hand of $13.1 mm and an unused demand line draw capacity of $5 mm.

- Net Operating Income for the quarter was $6.9 million, versus $6.5 million achieved on the same quarter last year. Increased NOI was mainly from the acquisition of the remaining 50% of two of the REIT's co-owned properties.

Actual three Actual three
months ended months ended
March 31, March 31,
2008 2007

(unaudited) (unaudited)

($000's) ($000's)
Rental Revenue and Other Income $14,046 $13,334
Property Operating Expenses $7,180 $6,807
Net Operating Income $6,866 $6,527
Trust Expenses $854 $993
Income before Interest, Depreciation &
Amortization $6,012 $5,534
Interest $3,351 $3,646
Depreciation and Amortization $4,545 $4,569
Loss Before Discontinued Operations ($1,884) ($2,681)
Gain from Discontinued Operations $397 $13,474
Net income (loss) after Discontinued
Operations ($1,487) $10,793

Loss Per Unit (Before Discontinued
Operations) (0.10) (0.14)

Funds From Operations(ii) $2,667 $2,712
Funds From Operations:
Basic $0.14 $0.15
Funds From Operations Payout Ratio 104% 102%

Full Financial Results will be available on SEDAR ( as well
as the Investors Relations section of the REIT's website

(i) Previously reported results have been reclassified for discontinued operations.

(ii) The reconciliation Funds From Operations to Loss after Discontinued Operations are included in the REIT's MD&A

The REIT's management considers Funds From Operations to be an indicative measure in evaluating the REIT's performance. The table above, however, includes non-GAAP information that should not be construed as an alternative to net earnings or cash flows from operations and may not be comparable to similar measures presented by other issuers as there is no standardized meaning prescribed by GAAP.

About Retrocom Mid-Market REIT

Retrocom Mid-Market REIT is an Ontario unincorporated open-end real estate investment trust which focuses on owning and acquiring mid-market retail properties in primary and secondary cities across Canada with the objective of producing a geographically diversified portfolio of properties with stable and growing cash flows.

This document may contain forward-looking statements, which although based on Management's best estimates as well as the current operating environment are subject to risks and uncertainties. As such, terms such as "anticipate", "believe", "expect", "plan" or other similar words should be taken as forward-looking statements. As a result of these potential uncertainties, any future results could differ materially from the predictions listed herein. Although Retrocom makes every effort to meet our predictions as listed in this document, we are unable to control certain circumstances such as economic, competitive or commercial real estate conditions.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, which may be made only by means of a prospectus, nor shall there be any sale of the Units in any state, province or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under securities laws of any such state, province or other jurisdiction. The Units of the Retrocom Mid-Market REIT have not been, and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or delivered in the United States absent registration or an application for exemption from the registration requirements of U.S. securities laws.

Contact Information

  • Retrocom Mid-Market Real Estate Investment Trust
    David Fiume
    Chief Executive Officer
    (416) 741-7999
    (416) 741-7993