Nexus Industrial REIT Announces Second Quarter 2025 Financial Results

Executive Summary

• Nexus Industrial REIT reported its second quarter and year-to-date results for the period ended June 30, 2025, marking its first full quarter as a pure-play industrial REIT following the strategic disposition of 33 legacy retail, office, and non-core industrial properties.
• The company reported a net loss of $7.6 million for Q2 2025, driven primarily by fair value losses on Class B LP units and investment properties, which were partially offset by a net operating income (NOI) of $32.2 million.
• Key operational metrics showed growth, with normalized FFO per unit increasing 5.6% year-over-year to $0.188, and industrial Same Property NOI growing 2.8% to $28.5 million.
• The REIT announced subsequent events including the issuance of Class B LP Units to settle construction obligations and a $160 million increase to its Unsecured Credit Facilities, extending maturities into 2027 and 2028.

Key Details

• Q2 2025 Financial Performance:
  • Net Loss: $7.6 million (vs. Net Income of $43.5 million in Q2 2024).
  • Net Operating Income (NOI): $32.2 million (up 1.7% YoY).
  • Industrial Same Property NOI: $28.5 million (up 2.8% YoY).
  • Normalized FFO per unit: $0.188 (up $0.009 or 5.6% YoY).
  • Normalized AFFO per unit: $0.160 (up $0.011 or 7.4% YoY).
  • Distributions declared: $15.076 million.
• Year-to-Date 2025 Financial Performance:
  • Net Income: $25.5 million (vs. $87.2 million in YTD 2024).
  • NOI: $64.2 million (up 5.0% YoY).
  • Industrial Same Property NOI: $54.5 million (up 4.3% YoY).
  • Normalized FFO per unit: $0.375 (up $0.032 or 9.3% YoY).
  • Normalized AFFO per unit: $0.313 (up $0.029 or 10.2% YoY).
  • Unitholders' Equity: $1.1 billion ($15.01 per unit).
  • NAV per unit: $13.17 (down $0.02 or 0.2% from Q4 2024).
• Portfolio & Development Updates:
  • Transitioned to pure-play industrial status by selling 15 legacy retail, 1 legacy office, and 2 non-core industrial properties for total proceeds of $62.1 million YTD.
  • Completed 395,412 sq. ft. of leasing in Q2 at an average spread of 38% over expiring/in-place rents.
  • Completed sale of two non-core industrial properties for $11.2 million.
  • Two development projects nearing completion (planned Q3 2025):
    • 325,000 sq. ft. expansion in St. Thomas, ON (cost: $54.9 million; going-in yield: 9.0%).
    • 115,000 sq. ft. small-bay complex in Calgary, AB (cost: $15.4 million; going-in yield: ~11%).
    • Combined annual stabilized NOI addition: $6.6 million.
• Subsequent Events:
  • July 4, 2025: Issued 2,764,464 Class B LP Units (valued at $10.50/unit) to 0768723 BC Ltd to settle initial construction obligations for 52,000 sq. ft. at the Richmond, BC property. Units are restricted until construction milestones are met and do not accrue distributions during the restriction period.
  • August 5, 2025: Increased Unsecured Credit Facilities by $160 million (from $625 million to $785 million). Term loan increased to $200 million; revolving facility increased to $575 million. Maturity dates extended to August 5, 2027 (term loan) and August 5, 2028 (revolving facility).
• Balance Sheet Metrics (June 30, 2025):
  • Total Portfolio: 88 investment properties, 2 under development.
  • Gross Leasable Area: 11.7 million sq. ft.
  • Industrial Occupancy: 94% (in-place and committed).
  • Weighted Average Lease Term (WALT): 7.1 years.
  • Net Debt: $1,258.8 million.
  • Total Indebtedness Ratio: 48.9%.
  • Net Debt to Adjusted EBITDA: 10.3x.
• Future Distributions:
  • October 15, 2025: $0.05333 per unit (Record date: Sept 30, 2025).
  • November 14, 2025: $0.05333 per unit (Record date: Oct 31, 2025).

Notable Quotes

• “The second quarter marked our first as a pure-play industrial REIT, and our strong operating results continued. Compared to a year ago, our normalized FFO per unit grew 5.6%, and industrial SPNOI grew 2.8%” — Kelly Hanczyk, CEO.
• “Over the past 12 months we have simultaneously grown NOI by 1.7%, while also completing the strategic disposition of 33 legacy retail, office, and non-core industrial properties. And, we will soon begin to realize the next phase of growth: we are nearing completion of two developments ahead of plan, which will add $6.6 million of annual stabilized NOI, representing unlevered returns of 9.4% on costs.” — Kelly Hanczyk, CEO.