Canadian Apartment Properties Real Estate Investment Trust (TSX:CAR.UN)
C$ 41.71 -0.99 (-2.32%) Market Cap: 6.97 Bil Enterprise Value: 14.03 Bil PE Ratio: 20.19 PB Ratio: 0.74 GF Score: 78/100
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Q2 2024 Canadian Apartment Properties Real Estate Investment Trust Earnings Call Transcript

Aug 08, 2024 / 01:00PM GMT
Release Date Price: C$48.68 (+1.37%)

Key Points

Positve
  • Canadian Apartment Properties Real Estate Investment Trust (CDPYF) reported a high occupancy rate of 98.2% as of June 30, 2024, with an average rent of $1,577 per month.
  • Operating revenues increased by 5.4% for the three months ended June 30, 2024, compared to the prior year period.
  • Net Operating Income (NOI) rose by 7.2%, and the margin expanded by 110 basis points to 67% for the second quarter.
  • Diluted Funds From Operations (FFO) per unit increased by 9.2% to $0.644 in the past quarter.
  • The company completed nearly $500 million in strategic transactions since Q1, increasing the portion of the property portfolio represented by recently built properties in Canada to 13%.
Negative
  • Higher interest costs partially offset the benefits of increased NOI and lower trust expenses.
  • The company faces challenges with the affordability of new rental units, particularly in high-end markets where rents are flattening.
  • There is a significant amount of Canadian mortgage principal maturing in the second half of 2024, representing 6.3% of the Canadian mortgage balance.
  • The company is experiencing a temporary increase in inducements and bad debt due to leasing up newer build assets.
  • The market for development land remains soft due to high interest rates and a struggling condo market, impacting potential future acquisitions.
Operator

Good morning. Thank you for attending today's Canadian Apartment Properties second quarter 2024 results conference call. My name is Cole, and I'll be the moderator for today's call. (Operator Instructions)

I'd now like to pass it over to Nicole Dolan. Please go ahead.

Nicole Dolan
Canadian Apartment Properties Real Estate Investment Trust - Associate Director, Investor Relations

Thank you, operator, and good morning, everyone. Before we begin, let me remind everyone that during our conference call this morning, we may include forward-looking statements about expected future events and the financial and operating results of CAPREIT, which are subject to certain risks and uncertainties. We direct your attention to slide 2 and our other regulatory filings for important information about these statements.

I will now turn the call over to Mark Kenney President and CEO.

Mark Kenney
Canadian Apartment Properties Real Estate Investment Trust - President, Chief Executive Officer, Trustee

Thanks, Nicole,

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