Northwest Healthcare Properties Real Estate Investment Trust Releases First Quarter Results

05-12-2011

TORONTO, May 12, 2011 (Canada NewsWire via COMTEX) --

NorthWest Healthcare Properties Real Estate Investment Trust (the "REIT") (TSX: NWH.UN), Canada's largest non-government owner and operator of medical office buildings and healthcare real estate, today announced its results for the first quarter ended March 31, 2011.

Highlights of the Quarter:

    --  The three month period ended March 31, 2011 is the first period
        that the REIT has reported under International Financial
        Reporting Standards ("IFRS").  For the REIT, significant
        accounting differences arising from the adoption of IFRS
        include (a) the valuation of investment properties at fair
        value (during the quarter the REIT recognized a modest increase
        in value), (b) the re-classification of the REIT's Class B LP
        Units as a liability rather than equity (notwithstanding that
        the characteristics of such Units remain exactly as before),
        and (c) the expensing of certain leasing costs which were
        previously capitalized (accordingly, the REIT has reduced its
        stabilized leasing cost reserve estimate by a corresponding
        amount).
    --  AFFO per unit for the quarter of $0.18 was favourable by $0.01
        against last quarter.
    --  Occupancy continued to improve, to 91.9% at March 31, 2011 from
        91.5% at December 31, 2010.
    --  The REIT extended its Revolving Credit Facility by two years
        and reduced its interest rate by 75 basis points.
    --  On January 25, 2011, the REIT completed the acquisition of the
        prominent medical and professional office complex known as The
        Dundas-Edward Centre, in Toronto, Ontario for $103 million.
        Located in the Discovery District of downtown Toronto, one
        block from University Avenue, The Dundas-Edward Centre is a
        410,000 square foot two-tower office complex with an
        eight-level parking facility. The complex is located in close
        proximity to several hospitals including SickKids, Princess
        Margaret, Toronto General, and Mount Sinai. The complex is
        currently 97% leased to primarily medical, professional and
        government tenancies.
    --  On February 1, 2011, the REIT completed the acquisition of Hys
        Centre, the premiere medical office complex in Edmonton,
        Alberta for $53 million. Hys Centre is strategically located on
        and connected by pedway access to the Royal Alexandra Hospital
        campus. Hys Centre is a Class "A" medical office complex
        composed of a 147,000 square foot medical office building, 50
        residential apartments and a 384-stall pay parking facility.
        The REIT will be arranging permanent long term fixed rate
        financing for this property.
    --  During the quarter the REIT raised net proceeds of $82.4
        million from a March 2011 follow-on equity offering, which
        proceeds were utilized primarily to pay down an interim bridge
        facility related to the acquisition of The Dundas-Edward Centre
        and Hys Centre.
    --  During the quarter the REIT refinanced the mortgage at 2924
        Taschereau Boulevard with a $4.3 million, 10 year fixed rate
        mortgage at 5.10%.
    --  The REIT paid monthly distributions of $0.06667 per unit during
        the quarter, consistent with its annualized target of $0.80
        cents per unit.
    --  Subsequent to the quarter on April 1, 2011 the REIT acquired
        the Malvern Medical Arts Building for $16.75 million.  The
        Malvern Medical Arts Building is a Class "A" office complex
        located in the former city of Scarborough portion of Toronto,
        approximately 3.7 kilometres from the Rouge Valley Centenary
        Hospital. The property consists of a 40,974 square foot medical
        office building and is currently 99% occupied.
    --  Subsequent to the quarter, the REIT entered into an agreement
        to acquire Tawa Centre, a 94,500 square foot medical office
        complex immediately adjacent to one of Edmonton's primary
        hospitals. The purchase is expected to close in the second
        quarter of 2011, subject to customary closing conditions. Tawa
        Centre is 89% leased to a quality roster of primarily
        healthcare related tenancies.  The purchase price will be
        approximately $25.9 million, subject to adjustments.  The REIT
        expects to assume the vendor's existing mortgage and fund the
        equity portion of the purchase price from existing resources.
    --  Subsequent to the quarter the REIT closed a $65 million 10 year
        fixed rate mortgage financing at 5.11% on the Dundas-Edward
        Centre, and fully paid down its Revolving Credit Facility.
    --  Subsequent to the quarter, the REIT renewed the mortgage on
        Glenmore Professional Centre at $35 million, for two years,
        with a fixed interest rate of 3.40%.
    --  Three quality assets (Hys Centre, Malvern Medical Arts Building
        and Alexander Medical Centre), representing approximately $80
        million in value, remain unencumbered.


Selected Financial Information:




                                              Pro-rated Actual Results
(unaudited)            Three Months Ended      for Three Months Ended

($000's, except unit
and per unit amounts)     March 31, 2011         March 31, 2010((1))



Revenue                           $27,102                      $19,745

Net Operating Income              $14,651                      $10,716

Funds from Operations              $7,899                       $6,026
("FFO")

Adjusted Funds from                $6,579                       $4,978
Operations ("AFFO")(
(2))

Debt to Gross Book                    48%                          55%
Value



Per unit data

FFO                                 $0.21                        $0.24

AFFO                                $0.18                        $0.20

Distributions                       $0.20                            -

AFFO Payout ratio                    113%                          n/a







         Represents the actual results for the seven day period from
(1)      March 25, 2010 to March 31, 2010 pro-rated on a straight-line
         basis for the three month period ended March 31, 2010.  These
         figures have been prepared by management and are unaudited.

(2)      AFFO amounts are calculated utilizing leasing and capital
         reserves of 4.5% of revenue from investment properties.




Peter Riggin, CEO, said "We have taken important strides in the first quarter to position us for future performance gains, as we completed the conversion to IFRS ahead of schedule, we have closed or announced acquisitions of approximately $200 million deploying the cash which we had on hand during the first portion of the quarter, and we have raised equity and debt to take advantage of an acquisitions pipeline which remains as robust as ever."

Some financial measures used in this press release, such as FFO and AFFO, 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. As such, they are unlikely to be comparable to similar measures presented by other real estate companies.  These non-IFRS measures are more fully defined and discussed in the REIT's management discussion and analysis (the "MD&A") for the first quarter of 2011, which is available on the SEDAR website at www.sedar.com.  Also on SEDAR are the interim financial statements of the REIT.

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", or "continue" or the negative thereof or similar variations.  The REIT's actual results and performance discussed herein could differ materially from those expressed or implied by such statements.  Such 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 "Risk Factors" in REIT's Annual Information Form and Prospectus and the risks and uncertainties set out in the MD&A which are available on www.sedar.com.  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.

The REIT invites you to participate in its conference call with senior management to discuss our first quarter 2011 results on Friday, May 13, 2011 at 8:00 a.m. (Eastern).

The conference call can be accessed by dialing 1-866-966-5335.

Audio replay is available until May 20, 2011 by dialing 1-866-583-1035 and entering access code 4533429, followed by the number sign.

The webcast of the conference call can be accessed from the "Investor Relations" page of the REIT's web site at www.nwhp.ca, and will be archived for 30 days.

To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/May2011/12/c4164.html

SOURCE: NorthWest Healthcare Properties Real Estate Investment Trust

Ernie Spraggs, CFO
(416) 366-2000 ext. 262, or www.nwhp.ca