Allied Announces Third-Quarter Results

Executive Summary

• Allied Properties REIT reported Q3 2025 results showing a net loss of $113.4 M (‑20.4% YoY) and a decline in FFO per unit of 18% to $0.456, reflecting material negative performance.
• Occupancy slipped to 84% occupied / 87.4% leased, missing the targeted 90% year‑end occupancy; lease renewals fell to 62% (nine‑month renewal rate 69%).
• The trust raised $1.3 B of debt in 2025 and retired $750 M of existing borrowings but still carries $4.68 B total debt with a net‑debt/EBITDA multiple of 12.3×, well above its <10× target.

Key Details

• Financial Performance (Q3 2025 vs Q3 2024)
• Rental revenue: $147.9 M (+0.9%)
• Operating income: $80.7 M (‑3.0%)
• Interest expense: $35.5 M (‑13.2%)
• Net loss and comprehensive loss: $(113.4) M vs $(94.2) M (‑20.4%)
• Adjusted EBITDA: $93.6 M (‑5.0%)
• FFO: $63.7 M vs $77.6 M (‑17.9%); FFO per unit $0.456 vs $0.556 (‑18.0%)

• AFFO: $59.1 M vs $68.0 M (‑13.1%); AFFO per unit $0.423 vs $0.487 (‑13.1%)

• Occupancy & Leasing

• Occupied area: 84%; leased area: 87.4% (both down from expectations)
• Lease renewals: 62% of expiries renewed in the quarter; nine‑month renewal rate 69% (below normal 70‑75%)
• Total GLA leased Q3: 881,628 sq ft (795,969 sq ft rental + 85,659 sq ft development)

• New user space: 324,063 sq ft; expansion by existing users: 187,153 sq ft

• Portfolio Optimization

• Completed non‑core sales in Edmonton, Vancouver, Montréal – proceeds $46 M.
• Additional non‑core sales pending (mid‑Nov 2025) for $55 M; further sales expected Dec 2025 for $85 M.

• Toronto & Calgary non‑core initiative: four Toronto + one Calgary properties slated to generate ~$84 M; Toronto House & Calgary House targeted to close Q2 2026, potentially doubling proceeds.

• Balance‑Sheet Management

• Raised $1.3 B via bond market in 2025.
• Retired: $200 M debenture, $400 M term loan, $150 M of a $250 M term loan (remaining $100 M extended).
• New unsecured revolving facility: $800 M (drawn $51 M); cash on hand $63 M.

• Total debt: $4.682 B; total indebtedness ratio 45.2%; net‑debt/EBITDA 12.3× (target <10×).

• Outlook for 2025

• Occupied & leased area expected to be flat year‑end vs Q3.
• Same‑asset NOI projected down ~1% YoY.
• FFO and AFFO per unit forecast to contract ≈10% for the full year.

Notable Quotes

• “We continued the strengthening of our debt profile and moved steadily toward completion of our developments and non‑core property sales in the third quarter,” – Cecilia Williams, President & CEO
• “The slower than expected pace of lease finalization and higher overall interest cost will require more time than initially anticipated to achieve our net‑debt/EBITDA target,” – Cecilia Williams