Q3 2024 Morguard Real Estate Investment Trust Earnings Call Transcript
Key Points
- Net operating income for the quarter increased by almost 6% to $32.2 million, driven by improved results in enclosed malls.
- Same asset net operating income for the third quarter rose by nearly 8%, with all asset classes showing growth.
- Retail results continue to improve, with increased traffic and sales in enclosed malls post-pandemic.
- The Trust has reduced its debt by $123 million over the past four years, focusing on paying down debt.
- Occupancy levels increased to 90.7%, with a notable 100 basis point rise in office asset occupancy, particularly in Alberta.
- Interest expenses increased by 5% for the quarter, primarily due to higher interest costs on mortgage rollovers.
- The Trust anticipates elevated capital needs above reserve amounts due to increased leasing capital requirements.
- A decrease in net operating income of approximately $13 million to $15 million is expected in 2025 due to lease-up and vacancy costs at Penn West Plaza.
- Liquidity decreased to $92 million at the end of the third quarter, down from $98 million in the second quarter and $101 million at the end of 2023.
- The office market remains challenging, with competitive leasing environments requiring aggressive tenant improvements and allowances.
Good afternoon, ladies and gentlemen, and welcome to the Morguard Real Estate Investment Trust 2024 third quarter results conference call. (Operator Instructions). This call is being recorded on Thursday, October 31, 2024.
I would now like to turn the conference over to Andrew Tamlin, CFO. Please go ahead.
Thank you, and good afternoon, everyone. My name is Andrew Tamlin, Chief Financial Officer of Morguard REIT. Welcome to the Morguard REIT's third quarter 2024 earnings conference call. I am joined this afternoon by John Ginis, Assistant Vice President of Retail Asset Management; Tom Johnston, Senior Vice President of Western Asset Management; and Todd Febbo, Vice President of Eastern Office Management. Thank you all for taking the time to join the call.
Before we jump into the call, I would like to point out that our comments will mostly refer to the third quarter 2024 MD&A and financial statements, which have been posted to our website. I will refer you
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