Inovalis Real Estate Investment Trust Announces the Financial Results for Q3 2025

Executive Summary

• Inovalis REIT reported Q3 2025 net rental income of C$3.7 M (up from C$3.5 M YoY) and total‑portfolio NRI of C$6.1 M, reflecting modest growth despite a 46.4% occupancy rate in the IP Portfolio.
• Funds From Operations (FFO) were positive at C$0.02 per diluted unit, while Adjusted Funds From Operations (AFFO) remained negative (‑C$0.03 per unit) due to capex and tenant‑improvement outlays.
• The REIT advanced its Asset Recycling Plan, signing a preliminary exchange contract for the Baldi property (€14 M) and progressing toward the sale of 87.5% of the Arcueil property (€37.5 M), with closing targeted for H2 2026.

Key Details

• Net Rental Income (IP Portfolio): C$3,701 K (Q3 2025) vs. C$3,518 K (Q3 2024).
• Net Rental Income – Total Portfolio: C$6,053 K (Q3 2025) vs. C$5,101 K (Q3 2024).
• Occupancy Rates (30 Sep 2025): IP Portfolio 46.4%; Total Portfolio 58.6% (ex‑recycling assets 80.2%).
• FFO: C$0.02 per diluted unit (positive) – aligns with guidance.
• AFFO: ‑C$0.03 per diluted unit (negative) due to C$1,581 K capex and tenant‑improvement costs.
• Unitholder Equity: C$190.6 M; Book value per Unit $5.74 (fully diluted).
• Debt Metrics: Debt‑to‑gross book value 51.5% (IP) / 59.6% (Total); weighted average interest rate 3.46%; variable‑rate debt 68% of total portfolio.
• Asset Recycling – Baldi Property: Preliminary exchange contract signed Aug 1 2025 for €14 M; financing condition waived.
• Asset Recycling – Arcueil Property: Sale of 87.5% announced Jan 2025 for €37.5 M; closing targeted H2 2026; marketing remaining 12.5% interest.
• Asset Recycling – Trio Property: Preliminary exchange agreement signed Oct 10 2025; subject to financing, expected close Q1 2026; re‑classified as “Asset Held for Sale” at $36,750 (valuation Q2 2025).
• Leasing Activity: Negotiations underway for a public‑hospital lease covering 10% of the Gaia property, slated to commence Q2 2026.
• Financing Profile: Predominantly asset‑level non‑recourse debt; average term to maturity ~2 years; weighted avg. interest rate 3.46% (excluding short‑term €5.6 M Bad Homburg loan).

Notable Quotes

“European real estate markets remain volatile and visibility is still limited. In this environment, we are focused on preserving balance sheet strength, maintaining strict capital discipline and pursuing the selective monetisation of individual assets.” – Stephane Amine, CEO & President

All amounts are presented in thousands of Canadian dollars unless otherwise noted.