Summit Industrial Income REIT Reports Fourth Quarter 2022 Financial Results

TORONTO, Feb. 15, 2023 /CNW/ – Summit Industrial Income REIT (“Summit” or the “REIT”) (TSX: SMU.UN) announced today continued growth and strong operating performance for the three months and year ended December 31, 2022.

2022 HIGHLIGHTS

FINANCIAL:

  • Revenue from investment properties increased by 15.8% in Q4 2022 and 15.4% in 2022.
  • Net rental income increased by 19.3% in Q4 2022 and 15.4% in 2022.
  • FFO1 increased 20.6% to $37.7 million ($0.199 per Unit) in Q4 2022 and 18.5% to $142.3 million ($0.761 per Unit), excluding the non-recurring secured mortgage prepayment costs incurred in 2021.
  • Completed a bought-deal equity offering of REIT Units for net proceeds of $220.2 million on March 31, 2022.
  • On April 19, 2022, the REIT increased the total size of its Green Unsecured Development Credit Facility by $100 million to $200 million ($150 million green tranche and $50 million conventional tranche).
  • On May 4, 2022, the REIT increased the total size of its $300 million unsecured revolving credit facility by $100 million to $400 million and extended the term by one year to March 23, 2025.
  • In May 2022, the REIT entered into $169.7 million of new 10-year secured term mortgage financing at an effective interest rate of 4.43%, a significant portion of which is interest-only.
  • Repaid $86.2 million of secured term mortgages at maturity during 2022.
  • Subsequent to year end, the REIT repaid an additional $17.9 million of secured term mortgages at maturity.
  • On September 14, 2022, DBRS Limited upgraded the REIT’s issuer rating and senior unsecured debentures rating to BBB with positive trends.
  • Approximately $1.7 billion of available liquidity1 and $4.1 billion of unencumbered assets at December 31, 2022.

OPERATIONS:

  • Near-full occupancy at 99.2% at December 31, 2022 with an average lease term of 5.4 years and 3.2% average annual contractual rent steps.
  • Same property NOI1 increased 6.2% in Q4 2022 and 5.7% in 2022, with Ontario and Quebec each contributing 8.4% and 6.5%, respectively, for Q4 2022 and 9.1% and 4.5%, respectively, in 2022
  • Completed over 2.6 million sq. ft. of lease renewals and new lease deals year-to-date generating a 53.2% overall increase in rents, including 90.6% in Ontario and 54.0% in Quebec (excluding contractual renewals).
  • Completed construction on approximately 928,000 sq. ft. of GLA in 2022 and transferred to income-producing properties.

____________________

1  Non-GAAP measure. Refer to “Non-GAAP Measures” section in this press release for further information.



PROPERTY PORTFOLIO:

  • Acquired six income-producing properties during the year for a total of 699,000 sq. ft. for a purchase price of $196.0 million.
  • Acquired interests in three development properties during the year, totalling 87 acres for a purchase price of $114.2 million, with the potential to add 1.7 million sq. ft. of GLA to the REIT’s portfolio.
  • Acquired the remaining 50% interest in one industrial property under development that was nearing completion in Guelph, Ontario totalling 91,782 sq. ft. from the REIT’s joint venture partner for a total acquisition cost of $12.8 million.
  • Acquired a 12-acre parcel of land with the potential to develop approximately 180,000 sq. ft. of industrial space, located at the intersection of Appleby Line and Highway 407 in Burlington, Ontario, for a purchase price of $27.5 million.
  • Disposed of a 32,000 sq. ft. non-core investment property for gross proceeds of $4.2 million.

OTHER:

  • On November 7, 2022, the REIT announced that it had entered into an agreement with GIC and Dream Industrial REIT, pursuant to which a joint venture between GIC and Dream Industrial REIT will acquire all of the assets and assume all of the liabilities of the REIT in an all-cash transaction, and the REIT will pay a special distribution and redeem all of its units for $23.50 per unit in cash. On February 7, 2023, the REIT announced that it had received approval under the Investment Canada Act in respect of the Transaction that was approved by the Ontario Superior Court (Commercial List) on December 20, 2022, and anticipates that closing of the Transaction will occur on or about February 17, 2023, subject to the satisfaction or waiver of all of the remaining customary closing conditions, all of which have been or are expected to be satisfied by or on such date.

This press release should be read in conjunction with Summit’s Consolidated Financial Statements for the years ended December 31, 2022 and 2021, and Management’s Discussion and Analysis for the year ended December 31, 2022, which are available on the REIT’s website at www.summitiireit.com and on SEDAR at www.sedar.com.

FINANCIAL AND OPERATING HIGHLIGHTS

Summit’s key financial and operating metrics for the three months and year ended December 31, 2022 are as follows:






Annual

(in thousands of Canadian dollars, except per Unit amounts)

Q4 2022


Q4 2021


2022


2021


2020











Portfolio Performance










Occupancy

99.2 %


99.2 %


99.2 %


99.2 %


98.0 %

Revenue from investment properties

$         65,905


$         56,911


$       250,328


$       216,971


$       190,906

Property operating expenses

$         16,675


$         15,649


$         64,019


$         55,544


$         50,796

Net rental income

$         49,230


$         41,262


$       186,309


$       161,427


$       140,110

Finance costs(2)

$         10,404


$           8,948


$         39,403


$         57,210


$         41,535

Fair value adjustments to investment properties

$       427,420


$         97,967


$       686,604


$    1,031,385


$         90,762

Net income

$       457,663


$       128,240


$       822,056


$    1,131,994


$       206,502











Operating Performance










FFO(1)(2)

$         37,724


$         31,277


$       142,268


$       100,040


$         94,389

FFO per Unit(1)(2)

$           0.199


$           0.178


$           0.761


$           0.587


$           0.651

Net income per Unit – basic

$           2.409


$           0.729


$           4.399


$           6.644


$           1.423

Same property NOI(1)

$         41,556


$         39,115


$       153,526


$       145,305


$         89,435

Same property NOI(1) growth

6.2 %


4.1 %


5.7 %


4.8 %


3.8 %











Distributions










Distributions declared to Unitholders(3)

$           9,195


$         24,841


$         89,635


$         95,024


$         79,252

Distributions per Unit declared to Unitholders(3)

$           0.048


$           0.141


$           0.478


$           0.556


$           0.540











FFO payout ratio without DRIP benefit(1)(2)(3)

24.4 %


79.3 %


62.8 %


94.7 %


83.0 %

FFO payout ratio with DRIP benefit(1)(2)(3)

48.7 %


60.3 %


60.2 %


73.8 %


67.6 %











Weighted average Units outstanding (in thousands)

189,977


175,909


186,880


170,390


145,089











Liquidity and Leverage










Total assets

$    5,718,120


$    4,542,994


$    5,718,120


$    4,542,994


$    3,172,213

Total unencumbered assets

$    4,124,541


$    2,996,333


$    4,124,541


$    2,996,333


$    1,054,481

Total debt

$    1,437,200


$    1,293,573


$    1,437,200


$    1,293,573


$    1,186,572











Weighted average effective interest rate

2.93 %


2.51 %


2.93 %


2.51 %


2.99 %

Weighted average term to maturity (years)

4.5


4.7


4.5


4.7


4.5











Leverage(1)

25.1 %


28.5 %


25.1 %


28.5 %


37.4 %

Interest coverage(1)

4.5x


4.3x


4.5x


4.1x


3.2x

Debt service coverage(1)

3.6x


3.3x


3.5x


2.9x


2.1x

Debt-to-adjusted EBITDA(1)

7.8x


8.3x


8.2x


8.5x


8.8x











DBRS Issuer Rating

BBB


BBB (low)


BBB


BBB (low)


BBB (low)











Income-Producing Investment Properties










Number of properties acquired


2


6


5


23

Number of properties disposed


1


1


7


2

Total number of properties

165


156


165


156


156

Total GLA

22,252


20,651


22,252


20,651


19,360





















(1) Non-GAAP Measure. Refer to “Non-GAAP Measures” section in this press release for further information.



(2) Finance costs and FFO includes strategic non-recurring mortgage prepayment costs of $20.0 million ($0.118 per Unit) for 2021. Excluding the prepayment costs, FFO per Unit was $0.705 per Unit for 2021. FFO payout ratio without DRIP benefit excluding the prepayment costs was 78.9% (61.5% including DRIP benefit) for 2021.

(3) Concurrent with the announcement of the Transaction on November 7, 2022, the REIT suspended its normal monthly distributions through closing, effective following the payment of the previously-declared monthly distribution for October 2022 that was paid on November 15, 2022.



PORTFOLIO GROWTH

During 2022, the REIT acquired six income-producing properties totalling 699,000 sq. ft. for a purchase price of $196.0 million and a 12-acre parcel of land with the potential to develop approximately 180,000 sq. ft. of industrial space, located at the intersection of Appleby Line and Highway 407 in Burlington, Ontario, for a purchase price of $27.5 million. The REIT also acquired a 50% interest in three development sites during the year through joint venture partnerships, totalling 87 acres. The development sites were acquired by the joint ventures for an aggregate purchase price of $114.2 million with the potential to add 1.7 million sq. ft. of GLA to the REIT’s portfolio, as well as the remaining 50% interest in one industrial property under development that was nearing completion in Guelph, Ontario totalling 91,782 sq. ft. from the REIT’s joint venture partner for a total acquisition cost of $12.8 million.

During 2022, the REIT completed the development of approximately 928,000 sq. ft. of industrial properties in Ontario and Quebec and transferred them to income-producing properties. These properties were all pre-leased and included 65 & 75 Quarterman Road and 54 Phelan Court in Guelph, 4225 North Service Road in Burlington,  2445 Surveyor Road in Mississauga, as well as the 7800 Trans-Canada Highway expansion premises in Montreal, Quebec.

At December 31, 2022, the REIT’s portfolio totaled 165 properties aggregating 22.3 million sq. ft., with an additional 12 buildings under development aggregating 2.6 million sq. ft. of potential GLA, for a total net book value of approximately $5.5 billion. During Q4 2022 and 2022, the REIT recognized fair value gains on its investment properties of $427.4 million and $686.6 million, respectively.

CONTINUED STRONG OPERATING PERFORMANCE

Revenue from investment properties for Q4 2022 and 2022 rose 15.8% and 15.4% compared to the same prior year periods due primarily to acquisitions completed over the prior twelve months, continuing strong occupancy and higher overall rental rates on leasing activities. Occupancy remained strong at December 31, 2022 at 99.2% with an average lease term of 5.4 years and 3.2% annual contractual rent steps.

Net rental income for Q4 2022 and 2022 increased 19.3% and 15.4% compared to the same prior year periods due primarily to continuing strong occupancy, higher overall rental rates on leasing activities and acquisitions completed over the prior twelve months.

FFO1 for Q4 2022 increased 20.6% to $37.7 million ($0.199 per Unit). Excluding the non-recurring secured mortgage prepayment costs of $20.0 million ($0.118 per Unit) incurred in 2021, FFO1 increased 18.5% in 2022. Excluding the mortgage prepayment costs discussed above, FFO per Unit1 for 2022 increased 8.0% compared to 2021 despite 9.7% increase in Units outstanding and further balance sheet deleveraging that took place in 2022 resulting in leverage1 of 25.1% at December 31, 2022. The REIT’s FFO payout ratio1 for Q4 2022 and 2022 was 24.4% and 62.8%, respectively, excluding the benefit of the REIT’s DRIP (48.7% and 60.2%, respectively, including the benefit of the REIT’s DRIP). The REIT’s FFO payout ratio1 for Q4 2022 and 2022 was impacted by the suspension of monthly distribution, concurrent with the announcement of the Transaction in November 2022.

Same property NOI1 rose 6.2% for Q4 2022 (5.7% for 2022), including a 8.4% increase in Ontario and 6.5% increase in Quebec (9.1% and 4.5% in Ontario and Quebec, respectively, for 2022). Growth in same property NOI1 in the fourth quarter of 2022 was driven primarily by rental rate growth from 2021 and 2022 lease renewals and new lease deals, which generated an average of 53.8% and 29.5% increase over expiring rents in Ontario and Quebec, respectively, in 2021, and 88.4% and 37.1% increase over expiring rents in Ontario and Quebec, respectively, in 2022, in addition to an increase in other income in Ontario in 2022. Growth in same property NOI1 for 2022 was partially muted by lower bad debt recoveries ($0.1 million in 2022 and $1.1 million in 2021). Same property NOI1 for Q4 2022 represented approximately 84.4% of total portfolio NOI1 and 87.9% of total GLA at December 31, 2022 (82.4% of total portfolio NOI and 82.9% of total GLA for 2022).

STRATEGIC LEASING PROGRAM

The REIT completed over 2.6 million sq. ft. of lease renewals and new lease deals in 2022, generating an average increase in monthly rents of 53.2% over the expiring rent with a significant 90.6% increase over expiring rents in Ontario, 54.0% in Quebec and 6.5% in Alberta (excluding contractual renewals).

The REIT maintained near-full 99.2% occupancy in Q4 2022 with limited to no downtime, while also taking advantage of significantly higher market rents on turnover of the space, with some re-leasing at rental rates in excess of 100% of the expiring rent.

STRONG BALANCE SHEET AND LIQUIDITY

Total assets increased to $5.7 billion at December 31, 2022, up from $4.5 billion at December 31, 2021 due primarily to property acquisitions during the period and fair value gains on investment properties. Total debt was $1.4 billion at December 31, 2022 compared to $1.3 billion at December 31, 2021. At December 31, 2022, the REIT’s unsecured debt represented 70% of total debt outstanding with approximately $4.1 billion in unencumbered assets.

On April 19, 2022, the REIT amended its green unsecured development credit facility to increase the commitment by $100 million. Following the amendment, the total credit facility size is $200 million, including a $150 million green tranche and a $50 million conventional tranche On May 4, 2022, the REIT amended its unsecured revolving credit facility to increase the commitment by $100 million to $400 million and to extend the term by one year to March 23, 2025. At December 31, 2022, $29.0 million was drawn on the unsecured revolving credit facility and $51.0 million was drawn from the green unsecured development credit facility.

During 2022, the REIT repaid $86.2 million in maturing secured term mortgages that carried a weighted average interest rate of 3.09%. Subsequent to year end, the REIT repaid an additional $17.9 million of secured term mortgages at maturity. The REIT also entered into $169.7 million of new 10-year secured term mortgage financing at an effective interest rate of 4.43%, a significant portion of which is interest-only.

The REIT’s debt metrics remained strong during the fourth quarter of 2022. At December 31, 2022, the REIT’s leverage ratio1 was 25.1% compared to 28.5% at December 31, 2021. Debt service coverage1, and interest coverage1 were 3.6x and 4.5x, respectively, for Q4 2022 compared to 3.3x and 4.3x, respectively, for the same prior year periods.

Debt-to-adjusted EBITDA was 7.8x and 8.2x for the three months and year ended December 31, 2022, respectively, a decrease from 8.3x and 8.5x for the same prior year periods.

At December 31, 2022, the REIT’s liquidity position remained strong at approximately $1.7 billion of available liquidity1 including cash, available borrowing capacity on its credit facilities, and potential for new financing that could be placed on a portion of its $4.1 billion of unencumbered assets.

ARRANGEMENT AGREEMENT TO ACQUIRE THE REIT

On November 7, 2022, the REIT announced that it had entered into an agreement (the “Arrangement Agreement”) with GIC and Dream Industrial REIT, pursuant to which a joint venture (the “Joint Venture”) between GIC and Dream Industrial REIT would acquire all of the assets and assume all of the liabilities of the REIT in an all-cash transaction via a plan of arrangement under the Canada Business Corporations Act, and the REIT will pay a special distribution and redeem all of its units for $23.50 per unit in cash (the “Transaction”). The Arrangement Agreement contains customary terms and conditions, including deal protections.

On February 7, 2023, the REIT announced receipt of approval under the Investment Canada Act in respect of the Transaction that was approved by the Ontario Superior Court of Justice (Commercial List) on December 20, 2022. The REIT anticipates that closing of the Transaction will occur on or about February 17, 2023, subject to the satisfaction or waiver of all of the remaining customary closing conditions, all of which have been or are expected to be satisfied by or on such date. Following completion of the Transaction, the REIT’s Units will be delisted from the TSX.

As a result of the Transaction, Summit will not host a conference call and webcast to discuss the financial results and operations for the fourth quarter.

NON-GAAP MEASURES

The REIT prepares and releases consolidated financial statements prepared in accordance with IFRS (GAAP). In this release, the REIT discloses and discusses certain non-GAAP measures, including FFO, FFO per Unit, FFO payout ratio, NOI, same property NOI, leverage ratio, interest coverage ratio, debt service coverage ratio, debt-to-adjusted EBITDA and available liquidity. The non-GAAP measures are further defined and discussed in Appendix A | Non-GAAP Measures in the MD&A for the year ended December 31, 2022 and filed on SEDAR (www.sedar.com), which is incorporated by reference and should be read in conjunction with this release. Since these measures are not determined by IFRS, such measures may not be comparable to similar measures reported by other issuers. The REIT has presented such non-GAAP measures as management believes the measures are a relevant measure of the ability of the REIT to earn and distribute cash returns to Unitholders and to evaluate the REIT’s performance.  These non-GAAP measures should not be construed as alternatives to net income or cash flow from operating activities determined in accordance with IFRS as an indicator of the REIT’s performance.

Reconciliation of Non-GAAP Measures

The following tables reconcile the REIT’s non-GAAP measures to the most comparable IFRS measures for the three months and year ended December 31, 2022.

Available Liquidity

The REIT’s available liquidity is calculated as follows:


December 31

December 31


2022

2021




Unencumbered assets

$        4,124,541

$        2,996,333

Assets required to be reserved under unsecured debt agreements:



Senior unsecured debentures(1)

(1,202,500)

(1,202,500)

Unsecured revolving credit facility(2)

(520,000)

(390,000)

Green Unsecured Development Credit Facility(3)

(260,000)

(130,000)

Unencumbered assets available to be encumbered

2,142,041

1,273,833

Borrowing Capacity on Unencumbered Assets(4)

$        1,178,122

$           700,608




Cash

47,732

16,052

Undrawn portion of unsecured revolving credit facility(5)

370,472

300,000

Undrawn portion of Green Unsecured Development Credit Facility(5)

135,382

90,000

Borrowing capacity on unencumbered assets (per above)

1,178,122

700,608

Available Liquidity

$        1,731,709

$        1,106,660




(1) Calculated as 1.3 times $925 million in aggregate senior unsecured debentures outstanding.

(2) Calculated as 1.3 times $400 million committed amount of unsecured revolving credit facility (December 31, 2021 – $300 million).

(3) Calculated as 1.3 times $200 million committed amount of Green Unsecured Development Credit Facility (December 31, 2021 – $100 million).

(4) Borrowing capacity is calculated as unencumbered assets available to be encumbered multiplied by 55% loan-to-value.

(5) Includes amounts drawn and letters of credit issued under the credit facility agreements.



FFO

The REIT’s FFO, FFO per Unit and FFO payout ratio are calculated as follows:




Q4 2022

Q4 2021


Q4 2022

Q4 2021

Annual

Annual






Net income

$        457,663

$        128,240

$        822,056

$     1,131,994

Adjustments:





Free rent amortization

391

311

1,428

1,231

Amortization of other assets

96

91

466

326

Transaction costs

4,748

4,748

Fair value adjustment to deferred unit compensation

2,246

602

174

2,565

Fair value adjustment to loans receivable

(4,691)

Fair value adjustment to investment properties

(427,420)

(97,967)

(686,604)

(1,031,385)

FFO(1)

$          37,724

$          31,277

$        142,268

$        100,040






FFO per Unit(1)

$            0.199

$            0.178

$            0.761

$            0.587






Distributions declared to Unitholders(2)

$            9,195

$          24,841

$          89,635

$          95,024

Distributions per Unit declared to Unitholders(2)

$            0.048

$            0.141

$            0.478

$            0.556

Cash Distributions paid(2)

$          18,390

$          18,852

$          85,649

$          73,872






Regular FFO payout ratio without DRIP benefit(1)(2)

24.4 %

79.3 %

62.8 %

94.7 %

Regular FFO payout ratio with DRIP benefit(1)(2)

48.7 %

60.3 %

60.2 %

73.8 %






Weighted average number of Units outstanding (in thousands)

189,977

175,909

186,880

170,390

Units issued and outstanding at the end of the period (in thousands)

189,977

176,900

189,977

176,900






Other items:





Straight-line rent adjustment

$           (1,702)

$           (1,316)

$           (5,532)

$           (5,542)

Non-recoverable capital expenditures

$              (326)

$              (366)

$           (3,106)

$           (1,154)

Leasing costs

$           (6,545)

$           (1,294)

$         (19,390)

$           (8,534)






(1) FFO includes strategic non-recurring mortgage prepayment costs of $20.0 million ($0.118 per Unit) for  2021. Excluding the prepayment costs, FFO per Unit was $0.705 per Unit for 2021. FFO payout ratio without DRIP benefit excluding the prepayment costs was 78.9% (61.5% including DRIP benefit) for 2021.

(2) Concurrent with the announcement of the Transaction on November 7, 2022, the REIT suspended its normal monthly distributions through closing, effective following the payment of the previously-declared monthly distribution for October 2022 that was paid on November 15, 2022.



Same Property NOI

In calculating same property NOI, the impacts from the straight-lining of rents and amortization of free rent have been excluded. Same property NOI excludes properties that would have had changes due to acquisitions, dispositions and redevelopments, as well as properties classified as held for sale.

The following tables reconcile same property NOI to net rental income for the periods presented:





Change

Change


GLA

Q4 2022

Q4 2021

($)

( %)







Ontario

10,267

$               20,955

$               19,331

$                 1,624

8.4 %

Quebec

4,019

7,985

7,498

487

6.5 %

Alberta

5,229

12,519

12,189

330

2.7 %

Other Canada

42

97

97

0.0 %

Same property NOI

19,557

$               41,556

$               39,115

$                 2,441

6.2 %







Acquisitions/dispositions/redevelopments

2,695

6,363

1,142

5,221


Straight-line rent


1,702

1,316

386


Free rent amortization


(391)

(311)

(80)


Net rental income

22,252

$               49,230

$               41,262

$                 7,968






Q4 2022

Q4 2021

Change

Change


GLA

Annual

Annual

($)

( %)







Ontario

9,924

$               80,866

$               74,145

$                 6,721

9.1 %

Quebec

3,254

22,878

21,883

995

4.5 %

Alberta

5,229

49,391

48,890

501

1.0 %

Other Canada

42

391

387

4

1.0 %

Same property NOI

18,449

$             153,526

$             145,305

$                 8,221

5.7 %







Acquisitions/dispositions/redevelopments

3,803

28,679

11,811

16,868


Straight-line rent


5,532

5,542

(10)


Free rent amortization


(1,428)

(1,231)

(197)


Net rental income

22,252

$             186,309

$             161,427

$               24,882




Financial Ratios

The REIT’s interest coverage ratio, debt service coverage ratio and debt-to-adjusted EBITDA are calculated as follows:




Q4 2022

Q4 2021


Q4 2022

Q4 2021

Annual

Annual






Net income

$           457,663

$           128,240

$           822,056

$        1,131,994

Adjustments:





Transaction costs

4,748

4,748

Free rent amortization

391

311

1,428

1,231

Amortization of other assets

96

91

466

326

Straight-lining of rents

(1,702)

(1,316)

(5,532)

(5,542)

Fair value adjustment to deferred unit compensation

2,246

602

174

2,565

Fair value adjustment to loans receivable

(4,691)

Fair value adjustment to investment properties

(427,420)

(97,967)

(686,604)

(1,031,385)

Finance costs(1)

10,404

8,948

39,403

57,210

Adjusted EBITDA

$             46,426

$             38,909

$           176,139

$           151,708






Adjustments to finance costs:





Non-recurring mortgage prepayment costs(1)

(20,036)

Interest expense (finance costs) excluding adjustments

$             10,404

$               8,948

$             39,403

$             37,174

Interest Coverage

4.5x

4.3x

4.5x

4.1x






Principal repayments (excluding mortgage payouts)

$               2,340

$               3,014

$             10,270

$             15,543

Principal and interest payments

$             12,744

$             11,962

$             49,673

$             52,717

Debt Service Coverage

3.6x

3.3x

3.5x

2.9x






Non-current loans and borrowings

$        1,383,593

$        1,199,376

$        1,383,593

$        1,199,376

Current loans and borrowings

53,607

94,197

53,607

94,197

Total loans and borrowings

1,437,200

1,293,573

1,437,200

1,293,573

Adjustments:





Unamortized premium on debt

(1,533)

(2,085)

(1,533)

(2,085)

Unamortized deferred financing charges

4,425

5,395

4,425

5,395

Total loans and borrowings (principal outstanding)

$        1,440,092

$        1,296,883

$        1,440,092

$        1,296,883

Adjusted EBITDA per above, annualized

$           185,704

$           155,636

$           176,139

$           151,708

Debt-to-Adjusted EBITDA

7.8x

8.3x

8.2x

8.5x






(1) The REIT incurred non-recurring mortgage prepayment costs of $20.0 million during 2021 on the strategic early repayment of $329.5 million of secured term mortgages, which were recorded in finance costs.



About Summit Industrial Income REIT

Summit Industrial Income REIT is an unincorporated open-ended trust focused on growing and managing a portfolio of light industrial properties in key markets across Canada. Summit’s units are listed on the TSX and trade under the symbol SMU.UN. For more information, please visit the REIT’s website at www.summitiireit.com.

Caution Regarding Forward Looking Information

This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends”, “goal” and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this news release contains forward looking statements and information concerning the goal to build Summit’s property portfolio; the Transaction and the terms thereof; the anticipated closing of the Transaction including the timing thereof. There can be no assurance that the proposed Transaction will be completed or that it will be completed on the terms and conditions contemplated in this news release. The proposed Transaction could be modified, restructured or terminated in accordance with its terms. The forward-looking statements and information are based on certain key expectations and assumptions made by Summit, including general economic conditions. Although Summit believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because Summit can give no assurance that they will prove to be correct. By its nature, such forward-looking information is subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed, and given the impact of the COVID-19 pandemic and government measures to contain it, as well as the current geopolitical environment, there is inherently more uncertainty associated with the REIT’s assumptions as compared to prior periods. These risks and uncertainties include, but are not limited to, the anticipated benefits of the Transaction to unitholders, the availability of cash flow from operations to meet monthly distributions, the ability to satisfy the conditions applicable to the Transaction, tenant risks, current economic environment, including disputes between nations, war and international sanctions, environmental matters, general insured and uninsured risks and Summit being unable to obtain any required financing and approvals. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. Summit undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE Summit Industrial Income REIT

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