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Having Reached 1B$ in Total Assets, BTB Reports Its Best Financial Performance Since Inception

Having Reached 1B$ in Total Assets, BTB Reports Its Best Financial Performance Since Inception

Montréal (Québec) February 24th, 2022: BTB Real Estate Investment Trust (TSX: BTB.UN) (“BTB” or the “REIT”) releases today its financial results for the fourth quarter and year ended December 31st, 2021, compared to the same periods of 2020, and announces the following highlights and information:

  • BTB again repeats a solid performance during the fourth quarter: BTB’s portfolio continued to show significant improvement across all asset classes and geographic regions. The fourth quarter’s financial performance was not impacted by the COVID-19 pandemic. With a solid foundation, BTB has embarked on a growth plan.
  • $183M of acquisitions concluded in 2021: the past year was marked by a series of acquisitions and an expansion to Western Canada:
    1. June 29th, 2021 (Q2): Acquisition of an industrial property of 99,000 sq.ft. located at 6000 Kieran Street, Montréal, Québec for a total consideration of $15M.
    2. November 8th, 2021(Q4): Acquisition of two life-science and high-tech office properties for a total of 237,978 sq.ft. located at 2344 and 2600 boulevard Alfred-Nobel, Montréal, Québec for a total consideration of $74M.
  • December 24th, 2021(Q4): Acquisition of a 421,293 sq.ft. portfolio in Western Canada consisting of 9 industrial properties and 1 office property located in Edmonton, Alberta and Saskatoon, Saskatchewan for a total consideration of $94M.
  • Same-property portfolio NOI [1]: increased by 9% compared to Q4 2020, due to additional recovery efforts, lower pandemic-related charges and a combination of higher occupancy rates and an increase in the average lease renewal rate.
  • Leasing Activity: BTB remained active in its lease renewal and leasing activity throughout the quarter and the year as the total leasing activity totaled 803,561 sq.ft. resulting in a 4% occupancy rate.
    • Q4 2021: 378,341 sq.ft. of leases expiring in the quarter and in anticipation of their term ending in years 2022 and later were renewed. BTB also concluded 77,049 sq.ft. of new leases during the quarter.
    • For the year ended 2021: a total of leases representing 621,286 sq.ft. were renewed with existing tenants and
      182,275 sq.ft. were leased to new tenants.
  • Rent Collection Rate: BTB collected 0% of rents during Q4 2021 and 99.1% of cumulative rents for the year ended 2021.
  • Funds From Operations (FFO) (1): was positively impacted in Q4 2021 by increased recoveries, reduced provisions for credit losses, an improvement in the occupancy rate across all property segments and an increase in average renewal rates.
    • Q4 2021: Recurring FFO (1) of 11.0 ¢ per unit compared to 9.9 ¢ per unit in Q4 2020, and the recurring FFO payout ratio (1) stood at 68.0% for the quarter, compared to 75.5% in Q4 2020.
    • For the year ended 2021: Recurring FFO (1) for the year stood at 42.1¢ compared to 38.3¢ for the year ended 2020 and the recurring FFO payout ratio (1) stood at 71.2% for the year compared to 88.7% in 2020.
  • Adjusted Funds From Operations (AFFO) (1):
    • Q4 2021: Recurring AFFO (1) of 9.4 ¢ per unit compared to 9.8 ¢ per unit in Q4 2020 and the recurring AFFO payout ratio (1) stood at 80.0 % for the quarter compared to 76.3 % in Q4 2020.
    • For the year ended 2021: Recurring AFFO (1) for the year stood at 38.5¢ for the year, compared to 35.0¢ in 2020 and the recurring AFFO payout ratio (1) stood at 77.9% for the year, compared to 97.1% in 2020.
  • Net Income & Comprehensive Income: totalled $23.2M for the quarter compared to $3.9M in Q4 2020, representing an increase of $19.3M, which is attributable to:
    • Increase in the fair value of investment properties: by $19.6M compared to $2.1M in 2020;
    • Increase in NOI: by approximately $2.0M.
  • Rental Revenue and Net Operating Income (NOI): stood at respectively $26.8M and $14.8M for the quarter, representing a respective increase of 3% and 15.7%, compared to Q4 2020. For the year ended 2021, rental revenue stood at $100.3M, and NOI stood at $56.3M, representing a respective increase of 7.9% and 9.9%.
  • Total Debt Ratio(1): BTB concluded the year with a total debt ratio (1) of 5%, recording a temporary regression of 1.1% compared to the same quarter last year. This impact is attributable to the Q4 2021 acquisitions that were financed with long-term debt, cash on hand and existing credit facilities. The Trust used the net proceeds from the disposition of the Cornwall properties (transaction announced in December 2021 and concluded in January 2022) to partially pay down the outstanding amount on its credit facilities and therefore, reduce the total debt ratio.
  • Cash position: BTB concluded the year with a cash position of $7.2M and has a total of $48M available on the credit facilities.

A MESSAGE FROM MICHEL LÉONARD, PRESIDENT AND CHIEF EXECUTIVE OFFICER

“BTB has delivered yet another remarkable quarter. As a matter of fact, the best in the last 7 quarters, demonstrating our robust fundamentals, marking a fabulous achievement for our 15th anniversary.  Our leasing spreads have been strong as both rental and occupancy rates were up notably. SPNOI (1) increased 6.9% year -over-year. We concluded a total of more than 800,000 square feet of leasing transactions from renewals to new leases, another material achievement for BTB. Large necessity-based retailers renewed their leases on a long-term basis, also showing their desire to maintain their locations in BTB’s portfolio. Property performance metrics are also definitely improving. Our 2021 acquisitions, totalling almost $200M of fair value, have resulted in a higher quality portfolio that has proven its strength, battling against COVID-19.”

SUBSEQUENT EVENTS

  • Acquisition of 979 & 1031 Bank Street, Ottawa, Ontario: On January 7th, 2022, BTB concluded the acquisition of two class A office properties located at 979 Bank Street and 1031 Bank Street in the Glebe borough of Ottawa, Ontario. Acquired for the aggregate purchase price of $38.1M (excluding transaction costs), this acquisition was funded from the existing undrawn capacity on BTB’s credit facility and available liquidity. These two properties increase BTB’s total leasable area by 116,226 sq. ft.
  • Disposition of the Cornwall Portfolio: On January 27th, 2022, BTB concluded the disposition of four industrial properties located at 705, 725 and 805 Boundary Road and 2901 Marleau Avenue in Cornwall, Ontario, for an aggregate sale price of $26M (excluding transaction costs and adjustments). Following the reimbursement of its mortgages on the properties, BTB received net proceeds of approximately $19M.
    The disposition of the four properties decreased the total number of properties owned by BTB to 73 and decreased the total leasable area by
    450,776 sq.ft.
  • Conditional development agreement: BTB has entered into a conditional agreement to develop a residential component on one of its retail sites where approximately 900 residential units could be built, thereby unlocking approximately $30M of proceeds. The conditional agreement is, inter alia, subject to a zoning change.

OTHER SIGNIFICANT HIGHLIGHTS AS DECEMBER 31st, 2021

  • Total number of properties: 75
  • Total leasable area: approximately 6.0 million sq. ft.
  • Total asset value: $1.1B
  • Market capitalization: $302M

FINANCIAL INFORMATION

The following two tables summarize our results for the quarters and years ended December 31st, 2021, and 2020.

Quarterly and Annual Financial Results

Reconciliation of Cash Flows From Operating Activities and Adjusted Funds From Operations (AFFO) (1)

QUARTERLY CALL INFORMATION

Management will hold a conference call on Friday, February 25th, 2022, at 10 am, Eastern Time, to present BTB’s financial results and performance for the fourth quarter of 2021.

DATE : Friday, February 25th, 2022
TIME : 10 am, Eastern Time
DIAL : Toronto and over-seas: 1-416-764-8688
North America (toll free): 1-888-390-0546
WEB : https://produceredition.webcasts.com/starthere.jsp?ei=1524814&tp_key=f13eaf04f7
VISUAL : A presentation will be uploaded on BTB’s website prior to the call

https://www.btbreit.com/investor-relations-2/annual-meeting-presentations/

The media and all interested parties may attend the call-in listening mode only.

Conference call operators will coordinate the question-and-answer period (from analysts only) and will instruct participants regarding the procedures during the call.

The audio recording of the conference call will be available by via playback until March 4th, 2022, by dialing: 1-416-764-8677 (local) or, 1-888-390-0541 (toll-free) and by entering the following access code: 393076 #

ABOUT BTB

BTB is a real estate investment trust listed on the Toronto Stock Exchange. BTB is a property owner active in eastern and western Canada and as of the date of this press release, owns 73 properties, representing a total leasable area of approximately 5.7 million square feet and a total asset value that surpasses $1.1 billion.

BTB’S OBJECTIVES

  • Generate stable monthly cash distributions that are reliable and fiscally beneficial to unitholders.
  • Grow the Trust’s assets through internal growth and accretive acquisitions to fund distributions.
  • Optimize the value of its assets through dynamic management of its properties in order to maximize the long-term value of its properties.

BTB offers a distribution reinvestment plan to unitholders whereby the participants may elect to have their monthly cash distribution reinvested in additional units of BTB at a price based on the weighted average price for BTB’s Units on the Toronto Stock Exchange for the five trading days immediately preceding the distribution date, discounted by 3%.

For more detailed information, visit BTB’s website at www.btbreit.com.

FOR FURTHER QUESTIONS:

Stéphanie Léonard, Director of Communications

(T) 514-286-0188 x256

(C) sleonard@btbreit.com

FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking statements with respect to BTB. 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 actual results and performance of BTB 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. Some 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 regulation and the factors described from time to time in the documents filed by BTB with the securities regulators in Canada. The cautionary statements qualify all forward-looking statements attributable to BTB and persons acting on their behalf. Unless otherwise stated or required by applicable law, all forward-looking statements speak only as of the date of this press release.

(1) Non-IFRS financial measure. See Appendix 1.