*All amounts stated in USD, unless otherwise
stated.
TORONTO, May 25, 2016 /CNW/ - Delavaco Residential
Properties Corp. ("Delavaco" or the "Company") (TSXV:
DVO.U) today announced its results for the first quarter ended
March 31, 2016.
FINANCIAL HIGHLIGHTS
- Excluding a one-time loss from the conversion of the
convertible unsecured debentures into equity, Funds From Operations
("FFO") for the quarter ended improved by $128,803 or 7% over the quarter ended
March 31, 2015;
- Adjusted Funds From Operations ("AFFO") for the quarter
ended improved by $464,756 or 30%
over the quarter ended March 31,
2015;
- Excluding a one-time loss from the conversion of the
convertible unsecured debentures into equity, FFO per share for the
quarter ended March 31, 2016 was
$(0.03) per share, in line with
March 31, 2015, and
- AFFO per share for the quarter ended March 31, 2016 was $(0.02) per share, a 33% improvement over the
$(0.03) per share reported as at
March 31, 2015.
PORTFOLIO HIGHLIGHTS
- Fair value of investment properties and assets held for sale as
at March 31, 2016, was $79,299,595, of which $41,901,004 is the single-family portfolio and
$37,398,591 is the multi-family
portfolio;
- Aggregate portfolio occupancy as at March 31, 2016, was 67%, or a 300 basis point
improvement over December 31, 2015.
Single-family portfolio occupancy was 53% while multi-family
portfolio occupancy was 98%;
- Average monthly rent for the aggregate portfolio was
$950, in line with the $949 per month reported at December 31, 2015. Single-family average rent was
$893 while average rent for the
multi-family portfolio was $1,067;
and
- Sold 27 single-family units located in Florida for an aggregate sale price of
approximately $1,737,435 during the
quarter ended.
SUBSEQUENT EVENTS
- From April 1, 2016, to
May 18, 2016, Delavaco sold 33
single-family units located in Florida for an aggregate sale price of
approximately $2.1 million. As such,
the Company has 84 remaining homes in Florida to dispose, of which 33 properties are
under contract that should generate proceeds of approximately
$2.8 million. Subsequent to these
home sales, the Company will be left with 51 homes to sell in
Florida; and
- On May 3, 2016, the Company
received both TSX Venture Exchange and note holder approval to
restructure the 7.5% Senior Secured Notes ("SSN").
Approximately 75% of SSN note holders have agreed to a revised
repayment plan (the "Revised Repayment Plan"). The Revised
Repayment Plan reduces the provision to make mandatory principal
repayments of the SSN of no less than $2.5
million to no less than $100,000, as accumulated with repayments being
made on the first of each month. As a result, the Company has
accumulated and paid out approximately $2.4
million of cash in its escrow accounts as a result of home
sales and has paid these amounts to the SSN note holders, thereby
reducing the amount owed to approximately $12.6 million.
ATLANTA SINGLE FAMILY
HOME DISPOSITION PROGRAM
- The Company has begun the process of disposing of its
Atlanta single family home
portfolio. The Atlanta portfolio
currently consists of 312 single family homes, of which 64 homes
are completely unencumbered while 128 homes are encumbered by the
SSN and the remainder (120 homes) by a $4.0
million mortgage. The Company has listed the unencumbered
and SSN encumbered homes with agents and undertaken a program to
sell these homes in a similar fashion as the South Florida assets. The remaining 120 homes
encumbered by the $4.0 million
mortgage are currently 57.5% occupied. The Company is actively
leasing these homes with a view of disposing of them once
stabilized. From the unencumbered and SSN encumbered home
portfolio, the Company has three homes under contract for an
aggregate contract price of $167,000
that should close during the second quarter of 2016.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: Certain
information in this news release constitutes forward-looking
statements under applicable securities law. Any statements that are
contained in this news release that are not statements of
historical fact may be deemed to be forward-looking statements.
Forward-looking statements are often identified by terms such as
"may", "should", "anticipate", "expect", "intend" and similar
expressions. Forward-looking statements in this news release
include, but are not limited to, statements regarding the
arrangements described above with Firm Capital, including the
property management arrangements, Single Family Property
Disposition Program and Debt Restructuring, which may not be
completed within the estimated time frames specified above or at
all. In the event that such steps are not completed to the
satisfaction of Firm Capital, the rebranding, Board
restructuring and new business focus described above will likely be
subject to amendment or may not proceed, which could have a
material adverse effect upon the Company. Failure to complete the
steps or any delays in their implementation may have a material
adverse affect upon the business of the Company and its market
value.. There is no assurance that the Company will be able to
complete the disposition of the Single Property Disposition
Portfolio at anticipated values or at all or that market conditions
will support the debt and equity raises contemplated by the
Company. Failure to achieve these objectives will have a material
and adverse effect upon the ability of the Company to complete the
announced terms of the Debt Restructuring. There is no assurance
that the amounts owed by the Company's former CEO will be repaid in
accordance with their terms or at all. There is no assurance that
the implementation of the steps, even if completed as described
above, will increase the market value of the Company's securities,
which is subject to numerous factors beyond the Company's
control.
Forward-looking statements necessarily involve known and
unknown risks, including, without limitation, risks associated with
general economic conditions; adverse factors affecting the U.S.
real estate market generally or those specific markets in which the
Company holds properties; volatility of real estate prices;
inability to complete the Single Family Property Disposition
Program or Debt Restructuring in a timely manner; inability to
access sufficient capital from internal and external sources,
and/or inability to access sufficient capital on favourable terms;
industry and government regulation; changes in legislation, income
tax and regulatory matters; the ability of Delavaco to implement
its business strategies; competition; currency and interest rate
fluctuations and other risks.
Readers are cautioned that the foregoing list is not
exhaustive. Readers are further cautioned not to place undue
reliance on forward-looking statements as there can be no assurance
that the plans, intentions or expectations upon which they are
placed will occur. Such information, although considered reasonable
by management at the time of preparation, may prove to be incorrect
and actual results may differ materially from those anticipated.
Forward-looking statements contained in this news release are
expressly qualified by this cautionary statement.
Certain financial information presented in this press release
reflect certain non-International Financial Reporting Standards
("IFRS") financial measures, which include NOI, FFO and AFFO. These
measures are commonly used by real estate investment companies as
useful metrics for measuring performance, however, they do not have
standardized meaning prescribed by IFRS and are not necessarily
comparable to similar measures presented by other real estate
investment companies. Delavaco believes that FFO and AFFO are
important measures of operating performance. The IFRS measurement
most directly comparable to AFFO is net income. These terms are
defined in Delavaco's Management Discussion and Analysis for the
Quarter Ended December 31, 2015 filed
on www.sedar.com.
Neither the Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this
release.
Additional information about Delavaco Residential Properties
Corp. is available at www.delavacoproperties.com or
www.sedar.com.
SOURCE Delavaco Residential Properties Corp