Boardwalk expands Montreal portfolio

Executive Summary

• Boardwalk REIT executed a $273.1-million transaction package involving the sale of two older communities in Edmonton and the acquisition of three new communities (Central Parc 1, 2, and 3) in Laval, Quebec.
• The acquisition is accretive to Funds From Operations (FFO) per unit, with an anticipated increase of two cents per unit for the remainder of the year and approximately seven cents per unit for the full year 2026.
• The transaction expands the trust's presence in the Greater Montreal market while disposing of older assets in Edmonton, aligning with its "capital upcycling" strategy.

Key Details

• Total Transaction Value: $273.1 million in gross transaction activity (excluding transaction and closing costs).
• Edmonton Dispositions:
  • Assets Sold: Westmoreland Apartments and Lorelei House communities.
  • Total Suites: 134 suites.
  • Gross Sales Price: $24.1 million.
  • Price Per Suite: Approximately $180,000.
  • Exit Cap Rate: Approximately 5.6%.
  • Buyer: Local private buyer.
  • Closing Date: Scheduled for September 2025.
  • Existing Debt: Aggregate mortgage balance of $8.6 million with a weighted average interest rate of 3.0%.
• Central Parc Acquisitions (Laval, Quebec):
  • Assets Acquired: Central Parc 1, 2, and 3.
  • Total Suites: 541 suites across three concrete towers.
  • Construction Period: Phased from 2019 to 2022.
  • Total Purchase Price: $249.0 million.
  • Price Per Suite: Approximately $460,000.
  • Going-In Cap Rate: 4.5% (excluding transaction costs).
  • Average Suite Size: 942 square feet.
  • In-Place Rent: Approximately $2,225.
  • Closing Date: Anticipated late September 2025.
  • Financing/Debt Assumption:
    • CMHC mortgages totaling $178.2 million.
    • Weighted-average interest rate: 1.56%.
    • Weighted average remaining term: 3.2 years.
  • Affordability: Partnership with CMHC to maintain in-place affordability criteria on 91 units.
• Financial Impact:
  • FFO Per Unit (Remainder of Year): Expected increase of $0.02 per unit (net of dispositions and acquisitions).
  • FFO Per Unit (Full Year 2026): Expected increase of approximately $0.07 per unit.
  • Strategic Use of Proceeds: Balanced approach between acquisitions, reinvestment in trust units via normal course issuer bid, and maintaining a strong balance sheet.

Notable Quotes

• "We are excited to welcome three new communities, Central Parc 1, 2 and 3, to our Boardwalk family forever. This addition marks further progress on our capital upcycling initiatives and significantly expands our presence in Greater Montreal, a desirable market for the trust that continues to exhibit strength, resilience and relative affordability." — Sam Kolias, Chairman and CEO
• "The trust is pleased to add these exceptional communities to its portfolio on an accretive basis to FFO per unit and at a meaningful discount to replacement cost." — Sam Kolias, Chairman and CEO