BTB Announces Resilient Q2 Operational Results with Growth in the Rental Renewal Spread, Reaching 4.8%

Executive Summary

• BTB Real Estate Investment Trust reported its financial results for the second quarter ended June 30, 2025, highlighting resilient operational performance despite a decline in reported rental revenue due to non-cash straight-line rent adjustments.
• Cash Net Operating Income (Cash NOI) grew by 0.5% year-over-year to $19.5 million for the quarter, while Adjusted Funds from Operations (AFFO) per unit increased slightly to 9.5¢ from 9.4¢ in the prior year period.
• The Trust completed significant lease activity, securing 122,815 square feet of renewals and 49,809 square feet of new leases, with an average rent renewal rate increase of 4.7%. Occupancy stood at 91.2%, though post-quarter dispositions improved the effective rate to 92.0%.

Key Details

• Rental Revenue: Totalled $30.5 million for Q2 2025, a decrease of $1.7 million (5.3%) compared to Q2 2024. This decline was primarily driven by $1.8 million in non-cash straight-line rent adjustments related to a lease amendment for Lion Electric ($1.6M) and the early departure of tenant Big Rig Trailers ($0.2M). Excluding these adjustments, revenue would have been $32.3 million, up 0.3% year-over-year.
• Cash NOI: Reached $19.5 million for the quarter, an increase of 0.5% ($0.1 million) compared to Q2 2024. For the six-month period, Cash NOI was $39.7 million, up 4.4% ($1.7 million) year-over-year. Growth drivers included a $1.0 million partial lease cancellation payment, $0.3 million from operating improvements/renewal spreads, and $0.4 million from the Winners/HomeSense lease.
• AFFO & FFO Metrics:
  • AFFO Adjusted per unit: 9.5¢ (Q2 2025) vs. 9.4¢ (Q2 2024), an increase of 1.1%.
  • FFO Adjusted per unit: 8.3¢ (Q2 2025) vs. 10.4¢ (Q2 2024), a decrease of 2.1¢, driven by the non-cash straight-line adjustments.
  • AFFO Adjusted Payout Ratio: 79.2% for the quarter.
• Leasing Activity:
  • Renewed leases: 122,815 square feet.
  • New leases: 49,809 square feet.
  • Average rent renewal rate increase: 4.7% for the quarter; 4.8% for the first six months of 2025.
  • Occupancy: 91.2% at quarter-end (down 130 bps from Q1 2025 and 340 bps from Q2 2024 due to a tenant bankruptcy). Post-quarter sale of 1170 Lebourgneuf Blvd. improves occupancy to 92.0%.
• Dispositions:
  • Sold industrial property at 3911 Millar Avenue, Saskatoon, for $6.1 million (closed June 16, 2025).
  • Sold office property at 1170 Lebourgneuf Blvd., Quebec City, for $10.5 million (closed July 11, 2025). The transaction included a $1.0 million balance of sale note maturing March 24, 2027, at 5% interest.
• Balance Sheet & Liquidity:
  • Total Debt Ratio: 57.1% (down 80 bps from Dec 31, 2024).
  • Mortgage Debt Ratio: 51.7% (down 110 bps from Dec 31, 2024).
  • Weighted Average Interest Rate on Mortgage Debt: 4.36%.
  • Cash on hand: $5.7 million.
  • Available credit facilities: $28.5 million.
• Portfolio Stats:
  • Total properties: 74.
  • Total leasable area: 6.1 million square feet.
  • Total asset value: $1.3 billion.
  • Market capitalization: $321 million (Unit price $3.64 as of June 30, 2025).
  • NAV per unit: $5.62.

Notable Quotes

• "BTB's performance in the second quarter of 2025 highlights our leasing efforts, improved cash flow, and strengthened financial metrics. The quality of our assets underpins our steady progress" — Michel Léonard, President and CEO of BTB.