NorthWest Healthcare Properties Real Estate Investment Trust Releases Second Quarter Results

08-14-2012

TORONTO, Aug. 14, 2012, 2012 (Canada NewsWire via COMTEX) --NorthWest Healthcare Properties Real Estate Investment Trust (the "REIT") (TSX: NWH.UN), the largest non-government owner and operator of Canadian healthcare real estate, today announced its results for the second quarter, 2012.

Highlights of the Quarter:

    --  AFFO per unit increased to $0.21 from $0.20 the previous
        quarter.
    --  Occupancy and committed occupancy increased slightly to 91.1%
        from 90.9% the previous quarter, with committed occupancy
        increasing to 91.7%, reflecting recent leasing initiatives,
        including the successful conversion of former theatre space at
        our Sunridge Professional Centre complex into a large
        multi-practitioner medical clinic and training centre of
        approximately 18,000 square feet for the University of Calgary.
    --  On April 10, 2012, a two year, $13.0 million floating rate
        mortgage loan secured against the Springbank Medical Centre
        funded. The mortgage bears interest equal to the bank's prime
        rate plus 1.25% or Bankers' Acceptances plus 2.25%.
    --  On April 10, 2012 the REIT completed the acquisition of Willow
        Brook Medical Centre, a 34,800 square foot medical office and
        retail property in Airdrie, Alberta. The purchase price was
        $14.5 million and the property was acquired free and clear of
        mortgage financing.  Subsequent to the acquisition, the REIT
        entered into a six year, $9.55 million mortgage at a fixed
        interest rate of 3.62% which funded on April 16, 2012.
    --  On May 7, 2012 a 10 year $11.7 million mortgage on the Malvern
        Medical Arts property funded, at a fixed rate (achieved with an
        interest rate swap contract) of 4.31% .
    --  On June 25, 2012, the REIT increased the mortgage on Glenmore
        Professional Centre in Calgary, Alberta to $40.0 million from
        $34.0 million.  The interest rate and maturity remain the same
        at 3.40% and May 2013 respectively.
    --  On April 20, 2012, the REIT entered into an agreement with
        NorthWest Value Partners Inc. ("NWVP"), a private company
        controlled by Paul Dalla Lana, the REIT's chairman and a
        substantial investor in the REIT, whereby the REIT, subject to
        regulatory approvals, would acquire, by way of a share and unit
        transaction, an eleven property medical office building
        portfolio (the "Initial GT Portfolio") located in Ontario from
        GT Canada Medical Properties REIT ("GT REIT") in the event NWVP
        was successful in a take-over bid for GT REIT.
    --  On May 31, 2012, NWVP announced it was successful in its
        take-over bid for GT REIT.
    --  On May 31, 2012, the REIT entered into an acquisition agreement
        with GT REIT to acquire, subject to regulatory approvals, all
        shares and limited partnership units of the applicable GT REIT
        subsidiaries controlling the Initial GT Portfolio for a
        purchase price together with reimbursement of certain
        transaction costs of $37.4 million, plus assumption of mortgage
        debt of approximately $42.0 million, subject to usual
        adjustments. The purchase price and transaction costs, at GT
        REIT's option and subject to regulatory approvals, will be
        satisfied by the issuance of REIT units at a price of $12.31
        per unit ($12.50 per unit closing price on the day the
        transaction was approved by the REIT less a 1.5% discount)
        and/or for cash.
    --  On June 1, 2012, to facilitate the GT REIT take-over by NWVP
        and in accordance with the April 20, 2012 agreement with NWVP,
        the REIT advanced $41.3 million to NWVP by way of a loan
        bearing 7% interest. The loan is fully guaranteed by NWVP and
        is due upon the conveyance of the Initial GT Portfolio, with an
        outside date of October 31, 2012.
    --  On June 1, 2012, the REIT issued by way of private placement
        1,323,858 REIT units to NWVP at the previously agreed upon
        price of $12.31 per unit, for aggregate consideration of $16.3
        million.
    --  On June 19, 2012, a subsidiary of the REIT entered into an
        agreement with a subsidiary of GT REIT to acquire, subject to
        regulatory approvals, all shares and limited partnership units
        of the applicable entities which had recently acquired a
        property municipally known as 249 Ontario Street, Port Hope
        Ontario (the "Port Hope Property") for a purchase price of
        approximately $2.9 million, plus the assumption of mortgage
        debt of approximately $5.0 million, subject to usual
        adjustments. The purchase price, at the vendor's option and
        subject to regulatory approvals will be satisfied by the
        issuance of REIT units at a price of $12.31 per unit and/or for
        cash.
    --  The transactions relating to the Initial GT Portfolio and the
        Port Hope Property are expected to close no later than October
        31, 2012 and to be immediately accretive.
    --  The REIT paid distributions of $0.06667 per unit on April 13,
        2012, May 15, 2012 and June 15, 2012 consistent with its
        annualized target of $0.80 cents per unit.


Selected Financial Information:




(unaudited)                       Three Months Ended Three Months Ended

($000's, except unit and per unit    June 30, 2012      June 30, 2011
amounts)



Revenue                                      $32,567            $28,884

Net Operating Income                         $18,155            $16,175

Funds from Operations ("FFO")                $10,769             $9,961

Adjusted Funds from Operations                $9,115             $8,236
("AFFO")

Debt to Gross Book Value                       50.9%              48.8%



Per unit data

FFO                                            $0.25              $0.23

AFFO                                           $0.21              $0.19

Distributions                                  $0.20              $0.20

AFFO Payout ratio                                96%               104%






Subsequent Events:

    --  Subsequent to the quarter, the REIT entered into a commitment
        letter for a new ten year $33 million mortgage against its
        Sunridge Professional Centre asset in Calgary.  The mortgage
        will replace an existing mortgage at Sunridge Professional
        Centre, resulting in net proceeds to the REIT, after costs, of
        approximately $21.0 million.  The mortgage loan is expected to
        fund in the third quarter, at which time the interest rate will
        be determined and fixed by way of an interest rate swap
        arrangement.
    --  The REIT has entered into agreements to acquire a controlling
        interest in Smyth Medical Centre, a 35,000 square foot medical
        office condominium property in Ottawa. The purchases are
        expected to close in the third quarter of 2012, subject to
        customary closing conditions and are expected to be immediately
        accretive. The condo units are being acquired for approximately
        $3.5 million free and clear of mortgages. Located just east of
        downtown, Smyth Medical Centre (1929 Russell Road) is a premier
        building in the Ottawa medical office market due to its
        favourable location, diversified healthcare tenant mix and
        appealing design. It is well-leased to primarily healthcare
        related uses that include pharmacy, laboratory, physiotherapy,
        dental and specialist physicians who benefit from the
        building's close proximity to the Ottawa Hospital General
        Campus.  The investment will be the REIT's first acquisition in
        Ottawa.
    --  The REIT has entered into an agreement to acquire 84% of 807
        Broadview Avenue, a 54,720 square foot medical office
        condominium building in Toronto. The purchase is expected to
        close in the third quarter of 2012, subject to customary
        closing conditions and is expected to be immediately accretive.
        The property is being acquired for $16.44 million, with the
        REIT assuming the vendor's existing mortgage, having a
        principal amount of approximately $9.34 million, an interest
        rate of 4.40% and a 2015 maturity. Located in a
        well-established Riverdale neighbourhood northeast of the
        downtown core, 807 Broadview Avenue is a recently constructed
        medical office condominium building that benefits from a
        central location and a modern design. The 45,770 square feet
        being acquired is 100% leased on a long term basis to the
        Albany Medical Clinic, a large full service Family Health Group
        that represents one of Canada's oldest, and one of Toronto's
        largest, healthcare clinics. The clinic is anchored by a large
        number of both general practitioners and medical specialists
        who are complemented by ancillary healthcare services that
        include laboratory, diagnostic imaging, dental, psychology and
        physiotherapy. The investment will be the REIT's thirteenth
        acquisition in Toronto.
    --  The REIT declared distributions of $0.06667 per unit to
        unitholders of record as at July 31, 2012 and August 31, 2012.


Peter Riggin, CEO, said "We are pleased with our results for the first half of the year, resulting in year over year and quarterly FFO and AFFO increases. We expect improving occupancy and further accretive acquisitions during the remainder of the year, furthering the stability of our portfolio of primarily necessity-based healthcare providers."

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 second quarter of 2012, 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 second quarter 2012 results on Wednesday, August 15, 2012 at 11:00 a.m. (Eastern).

The conference call can be accessed by dialing 416-640-3404 or 1-866-322-1159. The conference ID is 4834547.

Audio replay is available until August 22, 2012 by dialing 647-436-0148 or 1-888-203-1112. The conference ID is 4834547.

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.

SOURCE: NorthWest Healthcare Properties Real Estate Investment Trust

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SOURCE: NorthWest Healthcare Properties Real Estate Investment Trust

Ernie Spraggs, CFO (416) 601-3221, orwww.nwhp.ca