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Investor PresentationAs at March 31, 2018 unless otherwise noted
May 11, 2018
2STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Caution Regarding Forward-looking Statements
Certain statements made at this meeting will contain forward-looking information within the meaning of applicable securities laws (also known as forward-lookingstatements) including, among others, statements made or implied relating to the Trusts’ objectives, strategies to achieve those objectives, the Trusts’ beliefs, plans,estimates, projections and intentions and statements with respect to the Trusts’ development activities, including planned future expansions, redevelopment ofexisting properties and building of new properties; the return on investment and cost of the Trusts’ developments and other investments; the expected costs of anyof the Trusts’ projects; and the expected occupancy, budget, net leasable area or contributions to rental revenue from the Trusts’ developments and otherproperties. Statements concerning forward-looking information can be identified by words such as “outlook”, “objective”, “may”, “will”, “expect”, “intend”,“estimate”, “anticipate”, “believe”, “should”, “plans”, “project”, “budget” or “continue” or similar expressions suggesting future outcomes or events. Suchforward-looking statements reflect the Trusts’ current beliefs and are based on information currently available to management. Forward-looking statements areprovided for the purpose of presenting information about management’s current expectations and plans relating to the future and readers are cautioned that suchstatements may not be appropriate for other purposes. These statements are not guarantees of future performance and are based on the Trusts’ estimates andassumptions that are subject to risks and uncertainties, including those discussed in the Trusts’ materials filed with the Canadian securities regulatory authoritiesfrom time to time, which could cause the actual results and performance of the Trusts to differ materially from the forward-looking statements made at this meeting.Those risks and uncertainties include, among other things, risks related to: real property ownership, credit risk and tenant concentration; lease rollover risk, interestand other debt-related risk; construction risks; currency risk; liquidity risk, financing credit risk, cyber security risk, environmental risk; co-ownership interest inproperties, joint arrangement risks; unit price risk; availability of cash for distributions; ability to access capital markets; dilution; unitholder liability; redemption rightrisk; risks relating to debentures, tax risk and tax consequences to U.S. holders. Material factors or assumptions that were applied in drawing a conclusion or makingan estimate set out in the forward-looking statements include that the general economy is stable; local real estate conditions are stable; interest rates are relativelystable; and equity and debt markets continue to provide access to capital. The Trusts caution that this list of factors is not exhaustive. Although the forward-lookingstatements made at this meeting are based upon what the Trusts believe are reasonable assumptions, there can be no assurance that actual results will be consistentwith these forward-looking statements. Readers are also urged to examine the REIT and Finance Trust’s materials filed with the Canadian securities regulatoryauthorities from time to time as they may contain discussions on risks and uncertainties which could cause the actual results and performance of the REIT andFinance Trust to differ materially from the forward-looking statements made at this meeting. Neither Finance Trust nor any of its trustees or officers, assumes anyresponsibility for the completeness of the information contained in the REIT’s materials filed with the Canadian securities regulatory authorities or for any failure ofthe REIT or its trustees or officers to disclose events or facts which may have occurred or which may affect the significance or accuracy of any such information.Neither the REIT nor any of its trustees or officers, assumes any responsibility for the completeness of the information contained in Finance Trust’s materials filedwith the Canadian securities regulatory authorities or for any failure of Finance Trust or its trustees or officers to disclose events or facts which may have occurred orwhich may affect the significance or accuracy of any such information. All forward-looking statements made at this meeting are qualified by these cautionarystatements. These forward-looking statements are made as of August 10, 2017 and the Trusts, except as required by applicable law, assume no obligation to updateor revise them to reflect new information or the occurrence of future events or circumstances
3STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
H&RTotal Assets of $14.5 Billion
H&RTotal Assets of $14.5 Billion
OfficeOffice IndustrialIndustrial Retail(Primaris, ECHO and H&R Retail)
Retail(Primaris, ECHO and H&R Retail)
Multi-family (Lantower Residential)
Multi-family (Lantower Residential)
Long Term LeasesLong Term Leases Pension Fund JVPension Fund JV Stable PerformanceStable Performance High Growth OpportunityHigh Growth Opportunity
36 Properties ~12,297,000 Square Feet
91 Properties~9,670,000 Square Feet
381 Properties~18,274,000 Square Feet
17 Properties5,633 Multi-family Units
The Bow, Calgary
Corus Quay, Toronto
Atrium, Toronto
Dufferin Mall, Toronto
Orchard Park, Kelowna
Unilever, Mississauga
Grande Pines, Orlando
Legacy Lake, Lewisville
Stability, Security & Growth through Quality,
Diversification & Scale
Fully Internalized Management
(Insiders own 6%)
Fully Internalized Management
(Insiders own 6%)
One of Largest Diversified REIT in Canada With a Market Cap
of $6.4 billion
One of Largest Diversified REIT in Canada With a Market Cap
of $6.4 billion
Purolator, Calgary
4STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Ontario31%
United States34%
Other Canadian Provinces10%
Alberta25%
$13.9Billion
Office48%
Multi-family9%
Industrial7%
Retail(2)
36%
$13.9Billion
Portfolio Diversification
By Segment
Fair Value of Investment Properties(1)
(1) Includes the proportionate share of equity accounted investments.(2) Retail includes Primaris, ECHO and H&R Retail.
By Region
5STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Alberta Exposure – Office
(1) Same-asset property operating income (cash basis) excludes straight-lining of contractual rent and realty taxes accounted for under IFRIC 21. Includes the proportionate share of equity accounted investments.
(2) Encana Corporation has sublet 27 floors to Cenovus Energy.
H&R’s office tenants in Alberta are some of the strongest companies in the energy sector and their average remaining lease term is 18.2 years.
Address City
Total GLA
(Sq.Ft.)
Ownership
Interest
GLA at H&R's
Interest
% of H&R's Same-Asset
Property Operating
Income
(cash basis)(1)Remaining Lease
Term (years) Major Tenant
S&P Tenant
Credit Rating
5th Ave. at Centre St. Calgary 2,024,182 100% 2,024,182 12.5% 19.9 Encana Corporation(2) BBB Negative
450-1st St., S.W. Calgary 931,187 50% 465,594 2.0% 13.1 TransCanada Pipelines Limited A- Negative
2767-2nd Ave. Calgary 69,793 100% 69,793 0.1% 8.6 Alta Link LP A Stable
2611-3rd Ave. Calgary 95,225 50% 47,613 0.2% 8.6 Alta Link LP A Stable
Total / Average 3,120,387 2,607,182 14.8% 18.2
As at April 30, 2018
In April 2018, H&R sold its 50% ownership interest in F1RST Tower. There are currently no vacancies in H&R’s Alberta Office Portfolio.
6STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Institutional Quality Assets - Office
Atrium| Toronto
2 Gotham Centre | New York Corus Quay | Toronto
Place Bell | Ottawa
Hess Tower | Houston
The Bow | Calgary
7STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Institutional Quality Assets – Industrial & Retail
Orchard Park | Kelowna Sunridge | Calgary Dufferin Mall | Toronto Canadian Tire | Brampton
Sleep Country | Brampton
8STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Top 15 Tenants by Revenue
Predictable and stable income from long-term leases with high quality investment grade tenants
(1) Includes the proportionate share of equity accounted investments.(2) The percentage of rentals from investment properties is based on estimated annualized gross revenue excluding straight-lining of contractual rent, rent amortization of tenant inducements and capital
expenditure recoveries.(3) Average lease term to maturity is based on net rent.(4) Encana Corporation has sublet 27 floors to Cenovus Energy at The Bow located in Calgary, AB. Encana Corporation’s lease obligations expire on May 13, 2038.(5) Canadian Tire Corporation includes Canadian Tire, Mark’s, Sport Chek, Atmosphere and Sports Experts. (6) Lowe’s Companies, Inc. includes Rona.(7) Due to the confidentiality under the tenant’s lease, the term is not disclosed.
(1)
Tenant
% of rental income
from investment
properties(2)
Number of
locations
H&R owned
sq.ft. (in 000’s)
Average lease
term to maturity
(years)(3)
Credit Ratings
(S&P)
Encana Corporation(4) 11.6% 2 2,016 20.0 BBB Negative
Bell Canada 8.4 24 2,539 7.4 BBB+ Stable
Hess Corporation 5.0 2 848 (7) BBB- Stable
New York City Department of Health 3.5 1 660 12.6 AA Stable
Giant Eagle, Inc. 3.5 192 1,924 12.5 Not Rated
Canadian Tire Corporation(5) 2.6 19 2,636 7.8 BBB+ Stable
Lowe's Companies, Inc.(6) 2.4 21 2,561 3.4 A- Stable
TransCanada Pipelines Limited 2.1 2 542 11.9 A- Negative
Canadian Imperial Bank of Commerce 1.7 9 555 6.2 A+ Stable
Corus Entertainment Inc. 1.7 1 472 15.0 BB Stable
Telus Communications 1.6 18 427 5.6 BBB+ Stable
Government of Ontario 1.2 4 359 3.0 A+ Stable
Shell Oil Products 1.2 17 223 4.2 A+ Positive
Toronto-Dominion Bank 1.0 8 280 8.7 AA- Stable
Public Works and Government Services, Canada 0.9 5 307 4.2 AAA Stable
48.4% 325 16,349 11.2
9STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
10STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Limited Lease Rollover(1)(2)
1,104
3,116
2,019 1,897
2,667
2018 2019 2020 2021 2022
Industrial
H&R Retail
Primaris (Retail)
Office
(1) Includes the proportionate share of equity accounted investments.(2) Excludes residential properties.
268 519 463
772 1,301
2018 2019 2020 2021 2022
Industrial
ECHO (Retail)
H&R Retail
Office
Low-risk rollover schedule Well diversified by property and geography Average remaining lease term of 9.0 years, one of the longest in the industry
% of the Trusts' GLA(2) 3% 8% 5% 5% 7%
Canadian Portfolio(in ‘000s sq.ft.)
U.S. Portfolio(in ‘000s sq.ft.)
% of the Trusts' GLA(2) 1% 1% 1% 2% 3%
11STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
22 Years of Stable Occupancy
Consistently strong and stable occupancy in excess of 94% since 1997
98.0% 98.0%99.0% 99.0% 99.0% 99.0% 99.0% 99.4% 99.3% 99.6% 99.7%
98.9% 99.0% 98.9% 99.1% 98.7% 98.1%(1)97.8%
95.9%(2) 95.7% 95.6%94.1%(3)
50%
60%
70%
80%
90%
100%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Q1
(1) Due to acquisition of Primaris.(2) Primarily due to Target disclaiming their leases in Canada.(3) Primarily due to Sears filing for bankruptcy and vacating eight locations in Q1 2018.
12STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Primaris Mall Portfolio
(1) Primaris has a 50% ownership interest. The total GLA of the shopping centre has been reported above.(2) For the rolling twelve months ended February 28, 2018. Same store sales have been reported as if Primaris owned 100% of these enclosed
shopping centers.(3) Excludes Northland Village which is being redeveloped.
Chief Operating Officer: Patrick Sullivan
Property Location Major Tenants GLA (sq.ft.)
Same Store
Sales per
sq.ft. ($)(2)
Enclosed Centres
Sunridge Mal l Ca lgary, AB Hudson's Bay, Sport Chek, Alberta Health Servi ces 835,203 509
Orchard Park Shopping Centre Kelowna, BC Hudson's Bay, Sport Chek, Bes t Buy 712,953 702
Place d'Orleans(1) Orl eans , ON
Hudson's Bay, Sport Chek, Ca nada Mortgage and
Housi ng Corpora tion712,526 473
Catarqui Town Centre(1) Kingston, ON Hudson's Bay, Sport Chek 612,983 533
Place du Royaume(1) Chicoutimi , QC Wal -Mart, Winners, Sports Experts 604,411 439
Dufferi n Ma l l Toronto, ON Wal -Mart, No Fri l l s , Ma rshal ls 588,331 690
Stone Road Ma l l Guel ph, ON Sport Chek, Mars hal ls 565,616 632
Medicine Hat Mal l Medi cine Hat, AB Hudson's Bay, Safeway, Galaxy Ci nemas 510,736 390
Regent Mal l(1) Fredericton, NB Wal -Mart, Cinepl ex Odeon, Sport Chek 503,957 566
Park Pl ace Shoppi ng Centre Lethbri dge, AB Ci neplex Odeon, Winners , Sport Chek 480,540 624
McAl l i s ter Place(1) Sa int John, NB Sport Chek, Toys "R" Us, Goodl i fe Fi tnes s 465,248 484
Ki l donan Pl ace(1) Winni peg, MB Mars hal l s , Famous Players, H&M 446,910 544
Sherwood Pa rk Mal l Sherwood Park, AB Sobeys, Gal axy Cinemas , Goodl i fe Fi tness 435,358 494
Grant Park(1) Winni peg, MB Canadian Tire, Red River Co-Op, Goodl i fe Fi tness 405,726 455
St. Albert Centre St. Albert, AB Hudson's Bay, Sport Chek, London Drugs, Wi nners 357,003 485
Peter Pond Mal l Fort McMurray, AB Boomtown Cas ino, Sport Chek, Atmosphere 203,208 696
Total / Weighted Average (3) 8,440,709 555
13STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Primaris Tenant Sales Summary
Significant growth in sales productivity since 2011
Same Store Sales
per Square Foot (1)
2011 2012 (2)
2013 2014 2015 2016 2017 Q1 2018 (3)
British Columbia $485 $490 $522 $594 $639 $676 $699 $702
Alberta $465 $484 $561 $569 $571 $526 $530 $535
Manitoba $537 $655 $469 $477 $486 $520 $516 $521
Ontario $498 $502 $504 $497 $532 $548 $567 $575
Quebec $419 $439 $413 $421 $420 $418 $413 $439
New Brunswick N/A $457 $473 $477 $543 $547 $527 $531
Total (4)
$476 $485 $512 $521 $545 $539 $545 $555
(1) Reported as if Primaris owed 100% of these enclosed shopping centers.(2) 2012 MB sales productivity was high as Shoppers Drug Mart (“SDM”) sales were included (after SDM was expanded and became an Anchor tenant, their
sales were excluded in the productivity calculation).(3) For the rolling twelve months end February 28, 2018.(4) 2016, 2017 and Q1 2018 Alberta sales excluded Northland Village Mall which is being redeveloped.
Enclosed Shopping Centers
14STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Sears: Great Locations & Low Rent
(1) At H&R’s ownership interest.(2) For the rolling twelve months ended February 28, 2018.
Former Sears Locations Former Target Locations
# Locations 9 (8 Full line, 1 Home Store) 9
GLA (square feet)(1) 675,613 774,035
Annual Base Rent(1) $2.34M $4.01M
Base Rent P.S.F. $3.47 $5.18
New Tenants Committed T.B.D $8.50M
5 Sears stores previously operated in shopping centres that perform above portfolio average
Location Ownership Same Store Sales per sqft. (2)
Orchard Park Shopping Centre (2 stores) 100% $702
Park Place Shopping Centre 100% $624
Stone Road Mall 100% $632
Regent Mall 50% $566
15STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Lantower Residential
Chief Operating Officer: Philippe Lapointe
17 properties, 5,633 multi-family units
• Average property age of 8.3 years
• Fair value of investment properties: U.S. $946 million
• Mortgage payable: U.S. $469 million
Strategy: to build a portfolio of class A properties in U.S. Sun
Belt cities where there are strong job growth and to develop in
Gateway cities
See www.lantowerresidential.com for further information
As at March 31, 2018
16STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Acquired October 10, 2017
Class A Units: 451
Year Built: 2010
Purchase Price: $78,865,000
Purchase Price/Unit: $174,867
Average Rent: U.S. $1,251 per month
Rationale: Institutionally built product in desirable Tampa submarket characterized by affluent demographics and “A” rated public schools.
Lantower Residential – 2017 AcquisitionsSeneca at Cypress Point – Tampa, FL
17STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Acquired November 15, 2017
Class A Units: 282
Year Built: 2017
Purchase Price: $59,500,000
Purchase Price/Unit: $210,993
Average Rent: U.S. $1,450 per month
Rationale: New construction located in Orlando’s strongest renter submarket, largely benefitting from Orlando’s $60 billion tourism industry.
Lantower Residential – 2017 AcquisitionsLantower Grande Pines – Orlando, FL
18STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Acquired December 11, 2017
Class A Units: 450
Year Built: 2016
Purchase Price: $94,000,000
Purchase Price/Unit: $208,889
Average Rent: U.S. $1,458 per month
Rationale: Modern new construction with excellent highway visibility and quick access to major Tampa employment centers.
Lantower Residential – 2017 AcquisitionsLantower Brandon Crossroads– Tampa, FL
19STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Acquired December 12, 2017
Class A Units: 301
Year Built: 2016
Purchase Price: $49,665,000
Purchase Price/Unit: $165,000
Average Rent: U.S. $1,266 per month
Rationale: New construction with proximity to Legacy West in north Dallas, home to major corporate campuses including Toyota North American Headquarters.
Lantower Residential – 2017 AcquisitionsLantower Legacy Lakes – Dallas, TX
20STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
New York City
San Francisco
Austin
Miami
Seattle
Residential Developments
21STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Jackson Park Construction Update
H&R has a 50% interest in a landmark luxury residential rental development in Long Island City, New York.
Total cost of the project of all three phases at the 100% level is expected to be approximately U.S. $1.16 billion.
H&R’s total cash investment in the LIC Project is U.S. $260.7 million.
As at March 31, 2018, the project is on budget with approximately $149.3 million of costs remaining to complete, which will be funded from the construction facility.
Upon completion and stabilized occupancy, the first year’s property operating income at H&R’s ownership interest is projected to be U.S. $36.9 million, equating to a 6.1% yield on budgeted cost.
Long Island City, NY
21
22STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Jackson Park
KEY DESTINATIONS
Subway Rockefeller Center 8 min.
Grand Central Terminal
10 min.
Penn Station 14 min.
Wall St. & Broadway 25 min.
Driving LaGuardia Airport 13 min.
JFK Airport 20 min.
Newark Airport 30 min.
H&R Ownership: 50%
Average Unit Size: 708 sf
Projected Rent: $5.08 psf
Return on Cost: 6.15%
Long Island City, NY
22
23STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Jackson Park Leasing Update
1,871 luxury residential units with over 120,000 sf of amenities, 2 acre private park, and parking for 120 cars and 1,000 bicycles.
864 units had received certificates of occupancy, 353 leases had been signed and 241 units were occupied as at April 30, 2018.
Stabilized occupancy is expected to be achieved by Q4 2019. The lobby in Tower A, the first of three towers has been substantially completed and the roof amenity space in this tower is now open.
Project is slightly ahead of the development lease-up schedule with rental rates slightly higher than projected.
Long Island City, NY
23
24STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Mixed-Use Development H&R Ownership: 31.7%
38.4 acres
1,081 Unit Mixed-Use
Waterfront Master-Planned Community
Phase 1: 172 Multi-family Units
Construction Start: June 2018
Development Cost (Phase 1): $83.0 Million U.S. ($482,500/unit)
Projected Rent: $3.16 psf
Return on Cost (Phase 1): 6.48%
HerculesSan Francisco, CA
24
25STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
H&R Ownership: 33.3%
383 Multi-family Units
Development Budget:
$71.1 Million U.S. ($185,600/Unit)
Projected Rent: $2.02 psf
Construction Start: June 2018
Return on Cost: 6.83%
25
1301 Koenig LaneAustin, TX
26STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE 26
Close Proximity to Major Employers:
Apple
Oracle
IBM
Samsung
University of Texas
Texas Capitol
Koenig LaneAustin, TX
27STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
River LandingMiami, FL
27
28STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
River LandingMiami, FL
28
29STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE 29
Civic Center
River LandingMiami, FL
30STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
528 multi-family units
345,000 sf of retail space
145,000 sf of office space
Major Tenants: Publix, TJ Maxx, Hobby Lobby, Burlington, Ross, West Marine
Occupancy: Q1 2020
River LandingMiami, FL
30
31STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE 31
Microsoft Headquarters
Esterra ParkS E AT T L E
ESTERRAPARK
32STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE 32
H&R Ownership: 33%
7 Stories
263 Units
Development Cost:
$90.1 Million U.S. ($342,500/Door)
Market Rent: $2.86 psf
Construction Start: August 2018
Return on Cost: 6.17%
Esterra Park-Block 10S E AT T L E
33STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE 33
CaledonBrampton, ON
Industrial Lands 144 Acres 2.7M Buildable sf
Land Held for Development
34STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Dallas Office Development
Future Residential Development (4.8 acres)
34
2217 Bryan St.
93,000 sf of Office
Total Cost: U.S. $44 Million
Leased: 63%
35STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Acquisition & Disposition History (1)
(1) Includes the proportionate share of equity accounted investments.
(In Millions)
2018 Q1 2017 2016 2015 2014 Total
Acquisitions $4 $561 $354 $404 $220 $1,543
Dispositions (46) (431) (793) (481) (958) (2,709)
Net ($42) $130 ($439) ($77) ($738) ($1,166)
36STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Mortgage 29%
Unsecured Debentures
14%
Bank Indebtedness
4%Unitholder's Equity and Exchangeable
Units 53%
Strong Financial Condition
Total Capitalization
$14.0B
(1) Weighted average interest rate; outstanding debt includes outstanding mortgages and debentures payable(2) Weighted average term to maturity; outstanding debt includes outstanding mortgage and debentures payable (3) Debt includes mortgages payable, debentures payable and bank indebtedness
3.0 x Interest Coverage
BBB (High) Stable Trend by
DBRS
Unencumbered Asset $3.5B
WAIR1
3.9%WATM2
4.6 years
$600 M Available under Bank Facilities
46.3% 46.2%
44.3%44.6%
44.8%
40%
42%
44%
46%
48%
2014 2015 2016 2017 Q1 2018
Debt to Total Assets(3)
37STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Debt and Equity
114 unencumbered properties with fair value ~$3.5B, expected to grow substantially over the next 5 years
Significant untapped debt capacity through 52 encumbered properties valued at ~$1.5B with mortgages of $294.8M; average loan to value 19.5%; weighted average remaining term to maturity 3.6 years
Financing capacity
(1) Face value of debentures.
($ millions) Percentage
Mortgages $4,019 29%
Unsecured debentures(1) 1,911 14
Bank indebtedness 595 4
Unitholders' Equity plus
Exchangeable Units7,477 53
Total $14,002 100%
In Q1 2018, 3,609,720Stapled Units were purchased and cancelled at a weighted average price of $20.83 per Stapled Unit, for a total cost of $75.2 million.
38STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Unencumbered Asset Coverage Ratio
Q1 2018 2017 2016 2015 2014
Unsecured Debentures (carrying value) 1,902,011 1,749,650 1,312,693 1,297,420 1,274,400
H&R unsecured operating facility #1 35,000 208,713 166,089 165,499 -
H&R unsecured operating facility #2 190,829 186,629 205,829 - -
H&R unsecured operating facility #3 52,890 - - - -
Unsecured Debt 2,180,730 2,144,992 1,684,611 1,462,919 1,274,400
Unencumbered Assets 3,502,442 3,614,735 2,968,480 2,015,464 1,657,865
Coverage Ratio 1.61x 1.69x 1.76x 1.38x 1.30x
39STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Mortgage Maturity Schedule
(1) Converting U.S. dollars to Canadian dollars at an exchange rate of $1.29 as at March 31, 2018.
YearNumber of
Properties
Mortgage Debt due on
Maturity ($000's)(1)
Weighted Average Interest
Rate on Maturity
Fair Value of Investment
Properties ($000’s)(1) Loan to Value
2018 24 $89,229 4.8% $334,539 27%
2019 16 124,118 3.7% 333,703 37%
2020 15 351,106 4.5% 965,484 36%
2021 13 844,280 3.9% 3,524,638 24%
2022 48 591,034 4.0% 3,248,328 18%
116 $1,999,767 4.1% $8,406,692 24%
40STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Debenture Maturity Schedule
(1) Bears interest at a rate equal to 3-month Canadian Dealer Offered Rate plus 123 basis points. The interest rate for the period from January 23, 2018 to March 31, 2018 is 2.90%.(2) Denominated as $125,000 U.S. dollars and bears interest at a rate equal to 3-month London Interbank Offered Rate plus 79 basis points. The interest rate for the period from
February 13, 2018 to March 31, 2018 is 2.61%.
Unsecured Senior Debentures MaturityContractual
Interest Rate
Face Value
(000’s)
Series G Senior Debentures June 20, 2018 3.34% $175,000
Series C Senior Debentures December 1, 2018 5.00% 125,000
Series K Senior Debentures March 1, 2019 2.36% 200,000
Series M Senior Debentures(1) July 23, 2019 2.90% 150,000
Series P Senior Debentures(2) February 13, 2020 2.61% 161,250
Series F Senior Debentures March 2, 2020 4.45% 175,000
Series L Senior Debentures May 6, 2022 2.92% 325,000
Series O Senior Debentures January 23, 2023 3.42% 250,000
Series N Senior Debentures January 30, 2024 3.37% 350,000
3.30% $1,911,250
41STABILITY, SECURITY & GROWTH through QUALITY, DIVERSIFICATION & SCALE
Summary
One of the largest REITs in Canada with a market cap of $6.4 billion
High quality real estate
Predictable income
• Creditworthy tenants
• Long-term leases, with contractual rent escalations
• High, stable occupancy
• Minimal near term lease expiries and debt maturities
Development pipeline expected to create significant value and enhance cash flows
Solid balance sheet with a conservative payout ratio
Fully internalized and aligned management
CEO, founders and trustees own approximately6% of the REIT
Average annual return to unitholders since
inception of 13%