CT Real Estate Investment Trust reported on Monday its consolidated financial results for the first quarter ending March 31, 2025, announcing a distribution increase of 2.5%, which is a cumulative increase of 45.9% since initial public offering in 2013.
“Our performance this quarter, which delivered increases in Net Operating Income of 4.6% and Adjusted Funds From Operations per Unit of 3.9%, underscores our ability to deliver strong returns for our Unitholders and once again demonstrates our reliability, durability and growth potential in the face of ongoing macroeconomic challenges,” said Kevin Salsberg, President and Chief Executive Officer, CT REIT.
“I’m also particularly proud to announce that we will be increasing our monthly distributions for the 12th time, providing our Unitholders with a compound annual growth rate in distributions of 3.3% since our initial public offering.”
As a result of CT REIT’s consistent growth and reliability, the Board of Trustees has approved a 2.5% distribution increase that will be effective with the July 15 payment to Unitholders of record on June 30, 2025. Monthly distributions will increase to $0.07903 per Unit, or $0.94836 per Unit on an annualized basis and the REIT is pleased to have been able to reward Unitholders with such increases in each year since its initial public offering in 2013, said CT REIT in a news release.
CT REIT also entered into a ground lease with a third party to facilitate the development of a new Canadian Tire store in Kelowna, BC.
CT REIT is an unincorporated, closed-end real estate investment trust formed to own income-producing commercial properties located primarily in Canada. Its portfolio is comprised of over 375 properties totalling more than 31 million square feet of GLA, consisting primarily of net lease single-tenant retail properties across Canada. Canadian Tire Corporation, Limited, is CT REIT’s most significant tenant.
Financial Highlights
Net Income – Net income was $105.7 million for the quarter, an increase of $4.5 million, compared to the same period in the prior year, primarily due to higher revenues from the Property portfolio and increases in the fair value adjustment on investment properties, partially offset by higher interest and property expense.
Net Operating Income (NOI) – Total property revenue for the quarter was $150.4 million, which was $6.2 million or 4.3% higher compared to the same period in the prior year. In the first quarter, NOI was $118.7 million, which was $5.2 million or 4.6% higher compared to the same period in the prior year. This was primarily due to the acquisition, intensification and development of income-producing properties completed in 2024, which added $2.3 million, rent escalations from Canadian Tire leases, which contributed $1.9 million and development fee revenue, which also contributed $1.0 million.
Same store NOI was $114.0 million and same property NOI was $115.8 million for the quarter, which were $1.7 million or 1.5%, and $3.5 million or 3.1%, respectively, higher when compared to the prior year. Same store NOI increased primarily due to the increased revenue derived from contractual rent escalations and higher property operating recoveries. Same property NOI increased primarily due to the increase in same store NOI noted, as well as from the intensifications completed in 2024.
Funds from Operations (FFO) – FFO for the quarter was $81.1 million, which was $2.9 million or 3.7% higher than the same period in 2024, primarily due to the impact of NOI variances discussed earlier, partially offset by higher interest expense. FFO per unit – diluted (non-GAAP) for the quarter was $0.342, which was $0.011 or 3.3% higher, compared to the same period in 2024, due to the growth of FFO exceeding the growth in weighted average units outstanding – diluted (non-GAAP).
Adjusted Funds from Operations (AFFO) – AFFO for the quarter was $76.1 million, which was $3.4 million or 4.7% higher than the same period in 2024, primarily due to the impact of NOI variances discussed earlier, partially offset by higher interest expense. AFFO per unit – diluted (non-GAAP) for the quarter was $0.320, which was $0.012 or 3.9% higher, compared to the same period in 2024, due to the growth of AFFO exceeding the growth in weighted average units outstanding – diluted (non-GAAP).
Canadian Tire Corporation is CT REIT’s most significant tenant. As at March 31, 2025, CTC represented 92.8% of total GLA and 91.8% of annualized base minimum rent. As at March 31, 2025, CT REIT’s portfolio occupancy rate, on a committed basis, was 99.4%.
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