The REIT weathered the worst of the COVID-19 pandemic’s impact on the multi-residential segment
Attesting to the sustained robustness of the multi-residential asset class, Minto Apartment REIT reported strong results for the first quarter of 2021.
Despite some considerable pressure from the wide-ranging impact of the COVID-19 pandemic, Minto reported solid gain-to-lease performance for the quarter ending March 31. During this period, the REIT saw approximately $30 million in total revenue, having entered into 470 new leases (up by 33% annually).
Minto also saw its average rental rate on new leases settle at around 7.6% higher than expiring rents. The REIT recorded its highest ever average monthly rent during the quarter, at $1,630 (up by 1.9% annually).
“The REIT continued to productively deploy capital through its repositioning program, earning an annualized 8.7% return on the capital invested in the repositioning of 46 suites across its portfolio in Q1 2021,” Minto said in a statement. “Total available liquidity was $158.9 million, enabling the REIT to maintain financial flexibility and continue to capitalize on opportunities to drive long term net asset value growth.”
Read more: Low interest rates and affordability are driving Canadian demand for this property type
The company noted that challenging turnover patterns had continued to impact its financial results in the first quarter, as anticipated. Still, it reported significantly stronger gain-to-lease compared to the fourth quarter of 2020 and a strong liquidity position that it said protected it from further market volatility.
“We remain extremely confident that our rental markets will start to rebound in the second half of 2021 as vaccinations levels increase, immigration returns to target levels, work from home requirements are relaxed, and post-secondary students return to in-person learning,” said Michael Waters, president and CEO of Minto Apartment REIT.
“The favourable supply-demand fundamentals of multi-residential real estate have not changed in the past year, and the affordability gap between rental housing and home ownership has expanded in most Canadian cities.”
