October 01, 2024 4:35 PM EDT | Source: Northwest Healthcare Properties REIT
Extends 52% of Remaining 2025 Debt Maturities
Over $200 Million of Assets Globally on a Consolidated Basis listed for sale or under conditional sales contracts
Toronto, Ontario–(Newsfile Corp. – October 1, 2024) – Northwest Healthcare Properties Real Estate Investment Trust (TSX: NWH.UN) (the “REIT” or “Northwest”), a leading owner and operator of healthcare real estate infrastructure in North America, Brazil, Europe, and Australasia, today announced 2025 debt repayments, new financing and maturity extensions and progress with its disposition strategy to address remaining 2025 debt maturities and further deleveraging.
“Executing to plan, we’ve made significant progress on strengthening the balance sheet,” said Stephanie Karamarkovic, Chief Financial Officer of Northwest. “Through facility refinancing and extensions, we have reduced remaining 2025 debt maturities to approximately $340 million. In addition, we have advanced our disposition strategy with a further $200 million listed for sale or under conditional contract, which are expected to be accretive to adjusted funds from operations (“AFFO”) per unit and instrumental in decreasing debt and interest expense. These efforts help to position Northwest for greater long-term stability and create value for our unitholders.”
Refinancing Activity
Secured $421 million of new or renewed financing across several facilities, extending maturities previously occurring in 2024 and 2025 by 2.1 years on a weighted average basis with a nominal impact to the REIT’s weighted average interest rate.
The REIT’s 2025 debt maturities, which totaled $1.6 billion as at December 31, 2023, have been reduced to approximately $340 million on a proportionate basis as of September 30, 2024, represented by $215 million of mortgages and property level borrowings across multiple facilities in the REIT’s portfolio. Additionally, $125 million Series G Convertible Debentures maturing on March 31, 2025, which are not available for prepayment, are a continued focus for the REIT. The REIT’s objective is to repay the Series G Convertible Debentures on maturity through existing credit facility capacity and proceeds from further asset sales.
Disposition Activity
Northwest continues to actively pursue disposition opportunities. The REIT has over $200 million on a consolidated basis (over $100 million on a proportionate basis) of assets globally listed for sale or under conditional contract, which management expects to complete before March 31, 2025. These transactions are expected to be accretive to AFFO per unit and net proceeds are to be directed toward repaying high-cost debt including the REIT’s Series G Convertible Debentures. As part of the REIT’s ongoing strategy, it will continue to assess the portfolio and seek further opportunities to unlock value through the sale of non-core assets.
About Northwest
Northwest provides investors with access to a portfolio of high-quality international healthcare real estate infrastructure comprised as at August 13, 2024, of interests in a diversified portfolio of 186 income-producing properties and 16.1 million square feet of gross leasable area located throughout major markets in North America, Brazil, Europe and Australasia. The REIT’s portfolio of medical office buildings, clinics, and hospitals is characterized by long-term indexed leases and stable occupancies. Northwest leverages its global workforce in eight countries to serve as a long-term real estate partner to leading healthcare operators. For additional information please visit: www.nwhreit.com.
Non-IFRS Measures
Some financial measures used in this press release, such as SPNOI, FFO, FFO per Unit, AFFO, AFFO per Unit, AFFO Payout Ratio, and Proportionate Investment Properties are used by the real estate industry to measure and compare the operating performance of real estate companies, but they do not have any standardized meaning prescribed by IFRS.
These non-IFRS financial measures and non-IFRS ratios should not be construed as alternatives to financial measures calculated in accordance with IFRS. The REIT’s method of calculating these measures and ratios may differ from the methods of other real estate investment trusts or other issuers, and accordingly may not be comparable. Further, the REIT’s definitions of FFO and AFFO differ from the definitions recommended by REALpac. These non-IFRS measures are more fully defined and discussed in the exhibits to this news release and in the REIT’s Management’s Discussion and Analysis (‘MD&A’) for the three months ended June 30, 2024, in the ‘Performance Measurement’ and ‘Results from Operations’ sections. The MD&A is available on SEDAR+ at www.sedarplus.ca.
Forward-Looking Statements
This press release may contain forward-looking statements with respect to the REIT, its operations, strategy, financial performance and condition. These statements generally can be identified by use of forward-looking words such as ‘may’, ‘will’, ‘expect’, ‘estimate’, ‘anticipate’, ‘intends’, ‘believe’, ‘normalized’, ‘contracted’, or ‘continue’ or the negative thereof or similar variations. Examples of such statements in this press release may include statements concerning the REIT’s position as a leading healthcare real estate asset manager globally, including with respect to its sustainability efforts, progress on asset sales and debt refinancing and the impact of such asset sales and refinancings on balance sheet optimization, the simplification of the REIT’s business, further reduction of it’s the REIT’s debt and creation of unitholder value. The REIT’s actual results and performance discussed herein could differ materially from those expressed or implied by such statements. The forward-looking statements contained in this press release are based on numerous assumptions which may prove incorrect and which could cause actual results or events to differ materially from the forward-looking statements. Such assumptions include, but are not limited to (i) assumptions relating to completion of anticipated dispositions and deleveraging transactions; (ii) the REIT’s properties continuing to perform as they have recently, (iii) various general economic and market factors, including exchange rates remaining constant, local real estate conditions remaining strong, and interest rates remaining at current levels or decreasing; and (iv) the availability of equity and debt financing to the REIT and the REIT’s ability to refinance, or extend the maturity of, its existing debt. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations, including that the transactions contemplated herein are completed. Important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, changes in government regulations and the factors described under ‘Risks and Uncertainties’ in the REIT’s Annual Information Form and the risks and uncertainties set out in the MD&A which are available on SEDAR+ at www.sedarplus.ca.
These cautionary statements qualify all forward-looking statements attributable to the REIT and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release, and, except as expressly required by applicable law, the REIT assumes no obligation to update such statements.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/225136
SOURCE: Northwest Healthcare Properties REIT
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