NVU Investor Presentation - January 2020 · PRESENTATION Creating Value for Unitholders Across...

INVESTORPRESENTATION

Creating Value for Unitholders

Across Canada, Northview’s passion is providing our customers with a place to call home

JANUAR

Y20

20

2

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This presentation may contain forward-looking information. All information included in this presentation other than statements of historical fact, is forward-looking information. When used in this presentation, words such as “may”, “should”, “expect”, “will”, “anticipate”, “believe”, “intend”, “estimate”, “predict”,“project”, “potentially”, “starting”, “beginning”, “begun”, “moving”, “continue”, or other similar expressions identify forward-looking information. The forward-looking information included in this presentation relates to, among other things, current expectations of future results, performance, prospects andopportunities.

Forward-looking information is provided for the purpose of presenting information about current expectations and plans relating to the future and readers arecautioned that such statements may not be appropriate for other purposes. This information is not a guarantee of future performance and is based onNorthview’s estimates and assumptions. The forward-looking information is subject to a variety of risks and uncertainties, which could cause actual events,results and performance to differ materially from the forward-looking information. A full description of these risk factors can be found in Northview’s annualinformation form and other publicly filed information which may be located at www.sedar.com.

The forward-looking information is provided only as of the date of such information, and Northview, except as required by applicable law, assumes noobligation to update or revise this information to reflect new information or the occurrence of future events or circumstances.

NON-GAAP AND ADDITIONAL GAAP MEASURES

Certain measures contained in this presentation do not have any standardized meaning as prescribed by International Financial Reporting Standards(“IFRS”) and, therefore, are considered non-GAAP measures. These measures are provided to enhance the reader's overall understanding of financialconditions. They are included to provide investors and management with an alternative method for assessing operating results in a manner that is focusedon the performance of operations and to provide a more consistent basis for comparison between periods. These measures include widely acceptedmeasures of performance for Canadian real estate investment trusts; however, the measures are not defined by IFRS. In addition, these measures aresubject to the interpretation of definitions by the preparers of financial statements and may not be applied consistently between real estate entities. Pleaserefer to Northview’s most recent Management's Discussion & Analysis and Financial Statements for the disclosed financial information and definitions ofnon-GAAP measures and additional GAAP measures, including NOI, FFO, AFFO, debt to gross book value, and interest coverage contained in thispresentation.

Forward‐Looking Information

3

NOI %

26%26%

23%23%

34%34% 5%5%

12%12%

• One of Canada's largest publicly traded multi-family REITs with over$4 billion in total assets and market capitalization of $2 billion

• Portfolio of approximately 27,000 residential units, 344 execusuites,and 1.2 million square feet of commercial space in more than 60markets across eight provinces and two territories

• Well-diversified portfolio includes markets characterized by expandingpopulations and growing economies – including 34% of NOI fromOntario, supports stable and growing profitability and distributions toUnitholders

• Growth through successful developments and acquisition of qualityproperties in strong markets, driving organic growth, and increasing netasset value for Unitholders

0%

10%

20%

30%

40%

Ontario Western Atlantic Northern Quebec

UNITS %

80%

84%

88%

92%

96%

100%


OCCUPANCY %

-

500

1,000

1,500

2,000

2,500


AVERAGE MONTHLY RENT $

Note: Multi-family occupancy based on three months ended September 30, 2019. NOI percentage based on nine months ended September 30, 2019. AMR and Units as at September 30, 2019.

TSX: NVU.UNNorthview Apartment REITWho are we?

4

Well-Defined Growth Strategy• Growing earnings and net asset value by focusing on organic growth,

acquisition, and development

Proven Strategy and Track Record• Positioned for sustainable growth and yield

Ongoing Portfolio Diversification Across Canada• Provides stability to returns and distributions

Compelling Valuation and Attractive Yield• Opportunity for adjusted funds from operations (AFFO) multiple expansion,

improving balance sheet and strong coverage ratios

TSX: NVU.UN

204 Hespeler Road, Cambridge, ON

Dufferin Heights, Nanaimo, BC

Why Invest in Northview?One of Canada's largest publicly traded multi‐family REITs

3,186

3,573

4,177

4,513

2,000

3,000

4,000

5,000

2016 2017 2018 Q3 2019

(milli

ons o

f doll

ars)

TOTAL ASSETS

5

Well‐Defined Growth StrategyTrack Record of Outperformance

Parkwood Place, Guelph, ON

$22.69

$30.87

$21.00

$23.00

$25.00

$27.00

$29.00

$31.00

$33.00

Q3'16 Q1'17 Q3'17 Q1'18 Q3'18 Q1'19 Q3'19

IFRS NAVPU

Organic Growth

• Expansion of same door NOI growth through high-endrenovations, monthly rents increase, occupancy improvements,and expense management across the portfolio

Proven Active Acquisition Strategy

• Enhance portfolio quality, high-end renovation opportunities, anddiversification through NAV accretive acquisitions

Driving Growth Via Development

• Develop quality properties in new and existing key growth markets

ORGANIC GROWTH

Creating Value Through Organic Growth

6

Same Door NOI Growth

• Same door NOI growth and capitalization rate (“Cap Rate”)compression generated $276 million of net asset value increase or$4.19 per Trust Unit in the last twelve months

• Ontario represents 34% of NOI with recent same door NOI growth of10% compared to total portfolio of 2.8% for trailing twelve months(“TTM”); favourable economic conditions, population growth, and lack ofaffordable housing continues to fuel Ontario rental markets

• Potential improvement in Western Canada resource based markets,representing NOI exposure of approximately 50% of Western Canada

Maximizing Monthly Rents

• Strong average monthly rent growth with 7.1% increase on turnover, ledby Ontario at 16.4% in Q3 2019

Operating Expense Management

• Negotiating new contracts, process improvements, and leveragingeconomies of scale

High-End Renovation Program

• Maximize NAV increases with the high-end renovation program and itsongoing contribution to organic growth

• Recent acquisitions generates new opportunities

-5.9%

4.3% 4.5%2.8%

-9.0%

-6.0%

-3.0%

0.0%

3.0%

6.0%

2016 2017 2018 2019 TTM

Same Door NOI

90.7%

92.4%93.5% 93.5%

88.0%

91.0%

94.0%

2016 2017 2018 Q3'19

Occupancy

1,0161,049

1,094

1,133

950

1,000

1,050

1,100

1,150

2016 2017 2018 Q3'19

AMR

ORGANIC GROWTH

High‐End Renovation Program

7

Proven Successful Track Record• Achieved rate of return of 26.5%, average monthly rent

increase of $314 per suite, and completed 514 suites for$19,100 per suite as of Q3 2019

Program Expansion• Approximately 5,700 units remain eligible for the high-end

renovation program from newly identified properties andprevious acquisitions

NAV Creation• Since 2016, contributed annualized NOI increase of $6.1

million, translating to estimated value creation of $142 million

0

200

400

600

800

2016 2017 2018 2019F

HER Suites Completed

Rate of Return (%) 15% 23% 23% 20% - 25%

Capital Expenditure($millions)

$4.8 $8.3 $13.1 $13.0

Before After Before After

19 Rosemount Drive, Scarborough, ON

GROWTH VIA ACQUISITION

Active External Growth Acquisition Strategy

8

49 Queen Street East, Cambridge, ON

• Create NAV through organic growth in acquired portfolio in key growthmarkets

• Seek acquisition targets with ability to expand high-end renovationprogram, NOI and asset value growth, and enhance portfolio quality

• Ability to compete for acquisitions virtually in all markets acrossCanada including primary and secondary markets to further enhancediversification

• Leverage relationship with Starlight to access off-market opportunities

1070 Barrington Street, Halifax, NS

101 Rue Sunset, Dieppe, NB 171 Kortright Rd, Guelph, ON


Proven Execution and Strong Acquisition Track Record

9

851

201126

399

ON QC WC AC

2017$239 Million

1,577 Units

Largest Canadian multi-family acquisitiontransaction in 2017 for $197 million in keygrowth markets, including ON and BC,delivered on organic growth opportunities byidentifying 875 units for high-endrenovations.

1,154

137 131

ON WC AC

2018$334 Million

1,422 Units

In June 2019, completed a $53 millionacquisition from Starlight, newlyconstructed apartment complex and high-quality asset enhancing portfolio quality.

In August 2019, completed a $12 millionacquisition of a mixed-use property inHalifax, NS, which includes high-endrenovation opportunities.

16145

ON AC

2019$65 Million

206 Units

Completed acquisitions of $284 millionthrough Starlight relationship: propertieswere recently constructed luxury rentalapartments or provides opportunity toexpand the high-end renovation program,generate NAV growth.

• Continue to access substantial acquisition pipeline and off-market opportunities through Starlight relationship

• $638 million in acquisitions since 2017 in strategic markets

• Growing NOI and declining capitalization rates resulting in asset value increases primarily in ON


Strategic Relationship with Starlight

10

• Proven success executing off-market acquisitions by acquiring $534 million via Starlight relationship

• Facilitated 73% of acquisitions in highly competitive Ontario acquisition market, and $54 million fair value increasethrough value-added activities, such as the high-end renovation program

• Starlight, owned by Mr. Daniel Drimmer, a significant Unitholder and Trustee of Northview, is one of Canada’s leading privatereal estate investors, asset managers, and active in multi-family acquisition and disposition transactions

• Demonstrated success in adding value to the acquired properties with AMR and fair value increases

• Transactional Fee Agreement with Starlight, replaces the expired transitional services agreement in place since 2015,provides for a market fee to Starlight of 1% on assets sourced, but not owned, by Starlight

2017$239 Million

1,577 Units

2018$334 Million

1,422 Units

2019$65 Million

206 Units

79%

$284 Million1,267 Units

Starlight Other Vendors

89%

$53 Million161 Units


$197 Million1,250 Units


79%

82%

GROWTH VIA DEVELOPMENT

Driving Growth Via Development Strategy

11

• Generate NAV increases by completing projects with developmentyields of 100 to 200 bps higher than market capitalization rates

• Expand successful in-house development program to Ontario withthe first concrete development which commenced in mid-2019

• Focus on areas with high asking prices for existing properties andlong-term potential for high occupancy and rent increases

• Experienced in-house development capability provides flexibility inplanning, scope changes, and controlling key processes

Canmore, AB (140 units)Completed in Q3 2018

Cambridge Bay, NU (36 Units)Completed in Q2 2017

Calgary, AB, Phase 2 (158 Units)Completed in Q2 2019

Regina, SK (132 Units)Completed in Q1 2018


Development Pipeline with Proven Track Record

12

• Over $370 million invested in developments with over 2,000 units since 2012

• Completed $30 million of developments in 2019

• Developments of $118 million commenced in 2019

Nanaimo, BCTwo phase development of 251 UnitsTotal cost: $65.0 million ($259,000/unit)Stabilized Yield: 6.3%Market Cap Rate: 4.5%Phase 1, commenced in Q2 2019, 140 unitsfor $35.0 million

Dev

elop

men

ts U

nder

way

Kitchener, ONTwo phase development of 363 unitsTotal cost: $115.0 million ($317,000/unit)Stabilized Yield: 5.5%Market Cap Rate: 4.25%Phase 1, commenced in Q2 2019, 233units for $73.0 million

Iqaluit, NU30 units and 5,900 sq. ft.Total cost: $10.0 million ($330,000/unit)Stabilized Yield: 9.5%Market Cap Rate: 9.0%Commenced in Q3 2019

13

NAV increase of 22% above cost or $0.31 per Trust Unit from recently completed developments


NAV Creation through Developments

Regina, SK132 unitsQ1 2018 completionTotal Cost: $22.3 millionStabilized Yield: 7.5%Market Cap Rate: 5.5%NAV Increase: $5.8 million

Canmore, AB140 units and 40 staff housingQ3 2018 completionTotal Cost: $27.9 millionStabilized Yield: 7.5%Market Cap Rate: 5.5%NAV Increase: $7.4 million

Calgary, AB, Phase 2158 unitsQ2 2019 completionTotal Cost: $30.0 millionStabilized Yield: 6.5%Market Cap Rate: 5.0%NAV Increase: $5.3 million

Iqaluit, NU30 units and 11,400 s.f.Q1 2018 completionTotal Cost: $9.4 millionStabilized Yield: 9.5%Market Cap Rate: 9.0%NAV Increase: $1.3 million

2.0% 2.1%2.6%

3.4%

5.4%

InterRent Boardwalk CAP Killam NVU

34.8x

29.6x

23.3x 20.9x

16.2x

InterRent CAP Killam Boardwalk NVU

Compelling Valuation and Attractive Yield

• Opportunity to narrow AFFO multiple to peers

• Attractive 5.4% yield while executing on organic and external growth strategies

14

AFFO Multiple1 Distribution Yield2

(1) Source: CIBC as at September 30, 2019. Estimated consensus AFFO multiple for one year forward.(2) Source: CAR.UN, BEI.UN, KMP.UN, IIP.UN, and NVU.UN based on BMO Canadian Real Estate Comparables dated December 30, 2019.

3.52x3.19x 3.07x

2.88x 2.74x

1.79x1.57x

1.84x1.60x 1.46x

CAP Killam InterRent NVU Boardwalk

Interest Debt Service

60.2%

51.9%

Q2'16 2016 2017 2018 Q3'19

15

Strengthening Balance Sheet, Positioned for Growth

Coverage Ratios1

Debt to Gross Book Value• Reduction in leverage of 830 bps to 51.9%, since peaking

in mid-2016, from fair value growth, non-core asset sales,and equity offerings

• Balanced approach to manage leverage includesconsideration of debt to gross book value, net debt toEBITDA, and coverage ratios

• Further leverage reduction will be achieved throughfurther improvements in asset values with long term targetof 50% to 55%

(1) NVU.UN, CAR.UN, BEI.UN, KMP.UN and IIP.UN based on trailing twelve months as of September 30, 2019. (2) Source: CAR.UN, BEI.UN, KMP.UN, IIP.UN, and NVU.UN based on BMO Canadian Real Estate Comparables dated December 30, 2019. Estimated Net Debt to EBITDA includes convertible

debentures.

9.2x 9.6x 10.1x 10.5x

11.9x

CAP InterRent NVU Killam Boardwalk

Net Debt to EBITDA2

16

Current 5 year and 10 year CMHC interest rate of approximately 2.28% and 2.37%, respectively, below the average mortgage interest rate of 3.02% as at September 30, 2019

Balanced Mortgage Maturity Profile

3.93%

2.79%

3.46%

2.75%

3.11%2.86%

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

Remainder of 2019 2020 2021 2022 2023 Thereafter

(thou

sand

s of d

ollar

s)

Principal on Maturity Principal Repayments 10 Year CMHC Rate (2.37%) Weighted Average Interest Rate

TSX: NVU.UN – Key Statistics

Market Capitalization ($billions) $2.1

Enterprise Value ($billions) $4.3

Annual Distributions Per Unit $1.63

Distribution Yield 5.4%

Consensus AFFO Multiple1 16.2x

Multi-Family Units2 26,755

Commercial Square Feet (millions)2 1.2

Execusuites Units2 344

17

Financial Snapshot and Key Statistics

(in thousands of dollars, except per unit amounts)2019 TTM 2018 Change

Revenue 386,753 363,968 6.3%

NOI 225,714 212,126 6.4%

NOI Margin 58.4% 58.3% 0.1%

FFO Per Unit $2.04 $2.11 (3.4%)

FFO Payout Ratio 80.0% 77.2% 2.9%

(1) Source: CIBC as at September 30, 2019. Estimated consensus AFFO multiple for one year forward.(2) As of September 30, 2019.

Environmental, Social, and Governance (ESG)

18

Objective

• Northview Sustainability Program looks to strengthencorporate citizenship and build on existing initiatives, such asthe Northview National Community Cleanup and Earth Day

• Taking meaningful steps toward a more environmentally-sustainable future, reduce environmental footprint, andmanage the risk of rising energy costs

• Currently quantifying cornerstone projects, such as efficientboilers, wood pellets, LED lighting, heat sensors, watermonitoring, and low-flow toilets

Capital Allocated to Sustainability Initiatives

• Committed $3 million in 2019 with favourable paybacks andplanned capital expenditure of $20 to 25 million over the next 5years on sustainability initiatives on energy, water, and wastemanagement

Trustees Committed to Strong Governance

• Contributes to effectively creating value for Unitholders overtime and address risks of all kinds

• Highly values Northview and employee culture of honesty,integrity, and fairness

Contact Information

19

Todd CookPresident & Chief Executive [email protected]

www.NorthviewREIT.com

Travis BeattyChief Financial [email protected]

Leslie VeinerChief Operating [email protected]

General Investor Relations [email protected]

(403) 531-0720

Andrew PhonsavathFinance Director, Corporate Planning & Investor [email protected]

Appendix – Regional OverviewsNOI Diversified Across Canada

20

21

Ontario

Oshawa, ON

Hamilton, ON

Toronto, ON

Sarnia, ON

Guelph, ON

Kitchener-Waterloo, ON

London, ON

St. Catharines-Niagara, ON

Peterborough, ON

Brockville, ON

Southwestern ON: 5,724Eastern ON: 1,773Toronto and Area: 2,153

Lindsay, ON

Commercial Sq. Ft.Multi-Family Units9,650 22,000

Cambridge, ONBrantford, ON

Ottawa, ON

Kanata, ON

Bowmanville, ON

Ajax, ON

Note: Regions with a portfolio of greater than 500 units are illustrated with a larger dot.

Enhance portfolio through successful execution on high-end renovations,potential development opportunities, and capital redeployment into strongmarkets. Opportunities for internal and external growth from growingpopulations. Northview is present in 18 Ontario markets with concentrations inKitchener/Waterloo, London, Peterborough, and the Greater Toronto Area.Broad provincial economic strength has led to favorable market conditions.When combined with the high-end renovation program, Northview is realizingstrong average rent increases and high occupancy.

Billion$2.0Investment Properties

Million$76NOI Trailing 12 Months

Woodstock, ON Population Size: 14.4 million

Kitchener, ON London, ON Hamilton, ON

90%

92%

94%

96%

98%

100%

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19950975

1,0001,0251,0501,0751,1001,1251,150

Occu

panc

y (%

)

AMR

($do

llars

per m

onth)

AMR ($) Occupancy (%)

$0

$5

$10

$15

$20

$25

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'190%

5%

10%

15%

20%

NOI M

ulti-F

amily

($mi

llions

)

SD N

OI M

ulti-F

amily

(%)

SD NOI (%) NOI ($)

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018

GDP Growth (%) Population Growth (%)

22

Market Fundamentals

• Healthy economic outlook with USMCA deal expected to increase auto-industry production and investment inflow from high-tech companies

• Increased government spending on infrastructure and transportation stimulates economic growth

• Population growth expected to increase mainly from immigration

Source: Statistics Canada

950

1,000

1,050

1,100

1,150

1,200

1,250

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)

CMHC AMR ($) CMHC Occupancy (%)

Source: CHMC

WHY ONTARIO?

Favourable economic conditions

Increasing demand from constrained supply and rising costof home ownership

High occupancy, stable long term, and expected to remainnear historic highs

Strong rental rate growth

Ontario

23

Western Canada


Note: Regions with a portfolio of greater than 200 units in BC or 500 units in AB and SK or recent developments are listed. Regions with a portfolio of greater than 500 units are illustrated with a larger dot.

Western Canada – Alberta, British Columbia, and Saskatchewan, is driven byresource based markets in the northern part of the region and balancedeconomies in primary markets in the southern part of the region. Recent signsof stabilization leads to same door NOI growth and potential future growth asmarkets recover. The region is also well positioned to be the first choice for newresidents as the market recovers. Northview is a large landlord in many of themarkets, such as Fort McMurray, Grande Prairie, Lloydminster, Fort St. John,Dawson Creek, and Nanaimo, and benefits directly from growth in theselocations.

Billion$1.1Investment Properties


Fort McMurray, AB Nanaimo, BC Regina, SK

Fort McMurray, AB

Bonnyville, AB

Lloydminster, AB

Regina, SK

Calgary, ABLethbridge, AB

Fort Nelson, BC

Fort St. John, BC

Abbotsford, BC

Nanaimo, BC

Prince George, BC

Dawson Creek, BCGrande Prairie, AB

Airdrie, ABBC: 2,639AB: 4,623SK: 323

Canmore, AB

Jasper, AB

Population Size: 10.5 million

80%

85%

90%

95%

100%

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19950

975

1,000

1,025

1,050

1,075

1,100

Occu

panc

y (%

)

AMR

($do

llars

per m

onth)


$0

$3

$6

$9

$12

$15

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'190%

3%

6%

9%

12%

15%

NOI M

ulti-F

amily

($mi

llions

)

SD N

OI M

ulti-F

amily

(%)

SD NOI (%) NOI ($)

Northern Western Canada

Southern Western Canada

‐5%‐4%‐3%‐2%‐1%0%1%2%3%4%5%

2015 2016 2017 2018


900

950

1,000

1,050

1,100

1,150

1,200

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)


Western Canada – Alberta

24

Market Fundamentals

• Steady population growth, from both international andinterprovince migration, to drive demand for rental housing

• Uncertainty in the energy sector led by tumbling oil prices andtransportation bottlenecks

• Tightening mortgage rules slows down housing starts in theregion

• Employment and income growth expected despiteuncertainties in oil and gas sector

WHY ALBERTA?

Opportunities for improvements from cyclical recovery in resource based markets in Northern AB

Resilient economy – agriculture, forestry, government and services, and recovery in oil and gas

Continued population and rising net migration


Source: CHMC

25

WHY BRITISH COLUMBIA?

Southern BC – opportunities for acquisitions and significant government and service industries

Northern BC – resource based markets with opportunities for improvements from cyclical recovery

High occupancy rates and strong rent growth

Strong demand supported by elevated cost to home ownership and strong economic and population growth

Market Fundamentals

• Diverse province with positive long term economic story

• Economic expansion supported by the approval of LNGCanada project

• Growing population, both from net migration and positive birthrate, and tightening mortgage rules with keep rental demandstrong while new supply coming into the market will slightlypush vacancy rates upward

Western Canada – British Columbia

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018


950

1,000

1,050

1,100

1,150

1,200

1,250

1,300

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)



Source: CHMC

26

WHY SASKATCHEWAN?

Well-diversified and stable economy with low unemployment rate

Significant long term economic growth potential

Rich in potash, uranium, oil and gas, and production in agriculture

Increasing rental demand from continued economic and population growth

Market Fundamentals

• Well-diversified resources enabling the region to weatherglobal economic cycles

• World’s largest potash producer, top supplier of uranium,largest exporter of lentils, dried peas, oats and canola, andsecond largest energy producer in Canada

• Population growth as net migration improves due to improvingeconomic conditions

Western Canada – Saskatchewan

‐2%

‐1%

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018


850

870

890

910

930

950

970

990

1,010

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)



Source: CHMC

27

Northern Canada


Note: Regions with a portfolio of greater than 100 units in NT and NU or recent developments are listed. Regions with a portfolio of greater than 500 units are illustrated with a larger dot. Approximately 150 units located in smaller communities across Nunavut are not shown.

Million$639Investment Properties


Iqaluit, NU Yellowknife, NT Inuvik, NT

Yellowknife, NT

Inuvik, NT

Cambridge Bay, NU

Iqaluit, NU

NT: 1,309NU: 1,146 Population Size: 83,000

The Northern region includes the territorial capital cities of Yellowknife, NT, andIqaluit, NU, in addition to Inuvik, NT, and many small communities acrossNunavut. Largest source of income and best performing region with stable long-term with 60% of revenue from government leases. Its primary economic driversare mining, tourism, government research and administration. With a lack ofhousing supply, this region experiences high occupancy and contributes toCanada’s highest rental rates.

90%

92%

94%

96%

98%

100%

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'192,050

2,100

2,150

2,200

Occu

panc

y (%

)

AMR

($do

llars

per m

onth)


$0

$5

$10

$15

$20

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19

-12%

-7%

-2%

3%

8%

NOI M

ulti-F

amily

($mi

llions

)

SD N

OI M

ulti-F

amily

(%)

SD NOI (%) NOI ($)

28

Market Fundamentals

• Majority of population lives in non-market housing, whichincludes social housing, subsidized housing for governmentemployees, and housing for private firm employees

• Housing cost and demand are not market based like the rest ofCanada, government subsidies have a significant influence onhousing outcomes in Iqaluit

• Strong economic outlook due to new mining operations expectedto start production in the next five years

• Government spending expected to increase from risingpopulation, along with high fertility rates, results in upwardpressure on housing demand

WHY NUNAVUT?

92% of rental revenue from government tenancies

Average tenancy is over 10 years, annual turnover rate of 8%in 2018, demonstrating long-term stable tenant base

Average occupancy over last 6 years was 97.5% fromconsistent growth and lack of supply

Chronic housing shortages

Canada’s highest market rents

Northern Canada – Nunavut

Source: Northview Apartment REIT Reports

‐2%

0%

2%

4%

6%

8%

10%

12%

2015 2016 2017 2018


2,350

2,400

2,450

2,500

2,550

2,600

2,650

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)

NVU AMR ($) NVU Occupancy (%)


Market Fundamentals

• Housing cost and demand is market based, similar to thetraditional Canadian markets

• Economic growth remains stable despite maturing diamondindustry, with growing interest and activity in other metalproduction

• Aging population and increasing out-migration due to economicslow down is cooling labour market force

WHY NORTHWEST TERRITORIES?

Stable economy

Modest competition

Staff housing leases

High occupancy, limited supply of new rental apartments

Second highest market rents in Canada

29

Northern Canada – Northwest Territories

‐2%

‐1%

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018


1,200

1,300

1,400

1,500

1,600

1,700

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)



Source: CHMC

30

Atlantic Canada



Growing population and strong market for growth opportunities. AtlanticCanada, which includes the provinces of New Brunswick, Nova Scotia, andNewfoundland and Labrador, is driven by the resource based market in St.John’s, NL. In addition, the larger urban markets of Halifax and Moncton serveas important hubs for economic activity, education, and government. TheAtlantic region is characterized by stable increasing average rents and highoccupancy due to the economic growth and stability.



Halifax, NS Moncton, NB Halifax, NS

Moncton, NB

Dieppe, NB

Halifax, NSDartmouth, NS

Labrador City, NL Gander, NL

St. John’s, NL

NB: 1,338NS: 1,514NL: 1,728 Population Size: 2.3 million

90%

92%

94%

96%

98%

100%

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19700

750

800

850

Occu

panc

y (%

)

AMR

($do

llars

per m

onth)


$0

$2

$4

$6

$8

$10

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19-15%

-10%

-5%

0%

5%

10%

NOI M

ulti-F

amily

($mi

llions

)

SD N

OI M

ulti-F

amily

(%)

SD NOI (%) NOI ($)

31

WHY NEWFOUNDLAND AND LABRADOR?

Economic transformation underway with “The Way Forward”government initiative to strengthen the province’s economicfoundation

Strong rental demand from aging population exiting homeownership

Increasing immigration driving apartment constructiongrowth

Market Fundamentals

• Mining and energy based economy – consisting of iron, nickel-copper-cobalt, zinc-lea-copper production; and abundance ofrenewable and non-renewable energy resources

• Largest producer of electricity in the world on a per capita basisand one of the largest producers of petroleum in the world

• Efforts to increase net migration through Immigration Action Plandue to aging population

Atlantic Canada – Newfoundland and Labrador

‐4%

‐3%

‐2%

‐1%

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018


700

720

740

760

780

800

820

840

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)



Source: CHMC

32

Market Fundamentals

• Large concentration of government services and private sectorcompanies

• Fishing, mining, forestry, agriculture, and natural gas extractionsare major resource industries with steady economic growth

• Growing population from positive net migration

WHY NOVA SCOTIA?

Strengthening economic conditions

Steady population growth

Stable long term occupancy

Strong demand from newcomers, aging populationdownsizing, and employment growth

Atlantic Canada – Nova Scotia

‐1%

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018


860

880

900

920

940

960

980

1,000

1,020

1,040

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)



Source: CHMC

33

Market Fundamentals

• Rents continue to increase due to the addition of new rentalbuildings with higher average rents

• Housing starts have decreased since 2011, including rental units

• Growing population supported by immigration and intra-provincial movement

• Population growth amongst all groups with significant growth inthe 60-79 age group

WHY NEW BRUNSWICK?

Stable economic outlook

Higher Cap Rate acquisitions

Improved vacancy trend in market

Strong demand boost from newcomers, aging populationdownsizing, and employment growth

New construction supply decreased since peak in 2013

Atlantic Canada – New Brunswick

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018


660

690

720

750

780

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)



Source: CHMC

34

Québec



Organic growth opportunity from occupancy improvement. Northview’s Quebecregion is focused in the Montreal suburbs of Pointe Claire and St. Laurent.Montreal is the largest rental market in Canada and, consistent with Northview,demonstrates high occupancy and stable average rents.



Montreal, QC Montreal, QC Montreal, QC

Montreal, QC

Sept-Iles, QC

QC: 2,485 Population Size: 8.4 million

90%

92%

94%

96%

98%

100%

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19700

725

750

775

800

Occu

panc

y (%

)

AMR

($do

llars

per m

onth)


$0.0$0.5$1.0$1.5$2.0$2.5$3.0$3.5$4.0

Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19-11%

-6%

-1%

4%

9%

14%

NOI M

ulti-F

amily

($mi

llions

)

SD N

OI M

ulti-F

amily

(%)

SD NOI (%) NOI ($)

35

WHY QUEBEC?

Diversified economy reduces volatility of individual sectors

Demand fueled by robust labour market and immigration

Higher demand from newcomers and aging populationdownsizing

Demographics indicate preference for rental apartments overhome ownership

Market Fundamentals

• Economic expansion likely to slow down due to decliningproductivity gains from shrinking labor pool from agingpopulation

• Expected population growth from immigration driven byemployment growth and historic low unemployment rates

• Increasing demand for new apartment construction fromanticipation of rising net migration

Québec

0%

1%

2%

3%

4%

5%

2015 2016 2017 2018


570

590

610

630

650

670

2015 2016 2017 201880%

85%

90%

95%

100%

CMHC

AMR

($do

llars

per m

onth)

CMHC

Occ

upan

cy (%

)



Source: CHMC

NorthviewREIT.com

Across Canada, Northview’s passion is providing our customers with a place to call home

NVU Investor Presentation - January 2020 · PRESENTATION Creating Value for Unitholders Across...

Documents

Transcript of NVU Investor Presentation - January 2020 · PRESENTATION Creating Value for Unitholders Across...