Melcor Real Estate Investment Trust (MR) 2023年年度報告「TSX」.pdf

《Melcor Real Estate Investment Trust (MR) 2023年年度報告「TSX」.pdf》由會員分享，可在線閱讀，更多相關《Melcor Real Estate Investment Trust (MR) 2023年年度報告「TSX」.pdf（12頁珍藏版）》請在三個皮匠報告上搜索。

1、ANNUAL REPORT 2022ANNUAL REPORT2023FACTS&DATA1WEIGHTED AVERAGE LEASE TERM REMAINING(YEARS)GROSS LEASABLE AREA EXPIRING(%)WHATS INSIDEOn February 22,2024 the REIT announced the commencement of a strategic review process overseen by the REITs Independent Committee.DLA Piper(Canada)LLP has been retaine

2、d as legal counsel and BMO Capital Markets as financial advisor.There is no assurance that the strategic review process will result in the REIT pursuing or consummating any transaction or alternative,nor any assurance as to its outcome or timing.Melcor REIT is an unincorporated,open-ended real estat

3、e investment trust.We own,acquire,manage and lease quality retail,office and industrial income generating properties.As at May 10,2024,our portfolio is made up of interests in 37 properties representing approximately 3.1 million square feet of gross leasable area located in and around Edmonton,Calga

4、ry,Lethbridge,Grande Prairie and Red Deer,Alberta;and Regina,Saskatchewan.1.As at December 31,2023.2.Non-GAAP financial ratio.Refer to Non-GAAP Measures on page 36 of the MD&A for further information.3Key Metrics4Letter from the Chair 5Letter from the CEO6Properties Map8Corporate Governance10Environ

5、mental Commitment,Social Responsibility&Governance11Company Information383.15MASSETSSQUARE FEET GLA$73.9M89%REVENUEACFO PAYOUT RATIO213.111.510.812.414.325.512.420242025202620272028thereaftervacant3.755.743.30Northern ABSouthern ABBC&SK3.454.561.48OfficeRetailIndustrialGLA BY TENANT INDUSTRYKEY METR

6、ICSBY PROPERTY TYPE BY TENANT PROFILEBY REGIONOfficeRetailIndustrialLand Lease4949+4444+77+HH3030+6060+77+3+3+HHGLARENTNorthern ABSouthern ABBC&SK6262+2828+1010+HH5757+3535+88+HHGLARENTLocalNationalRegional3434+4646+2020+HH3434+4646+2020+HHGLARENT55+77+1111+5+5+77+33+55+2222+3535+HHFinance&Insurance

7、-5%Government-7%Hospitality-11%Industrial-5%Medical-7%Oil&Gas-3%Other-5%Professional-22%Retail-35%33+2222+1919+26+26+44+1010+1616+HHAuto Service-3%Clothing-22%Grocer/Pharmacy-19%Home&Garden-26%Liquor/Cannabis-4%Personal Services-10%Specialty-16%RETAIL SUBCATEGORIESinvaluable guidance over the past d

8、ecade.Ms.Graham,as Chair of the Audit Committee,provided expert advce on finance,financial reporting and good governance.We welcomed new trustees Barry James and Brandon Kot,whose extensive experience in finance and real estate and fresh perspective will benefit the Board.Richard Kirby has taken on

9、the role of Lead Trustee and Chair of the Governance Committee and the Independent Committee.Following recommendations from the Independent Committee,the Board appointed BMO as financial advisor and DLA Piper(Canada)LLP as legal advisor to assist the REIT in determining the best possible future outc

10、ome for stakeholders.The board has not set a timeline or other expectation for the strategic review process and will continue to manage its assets in the best interests of unitholders.I am grateful to our trustees and the contracted management team from Melcor Developments for their commitment and e

11、xceptional service during the ongoing challenges being faced by the REIT.The board is confident that our assets,management,governance and a refreshed strategy will lead to a positive and responsible outcome for the REIT.MESSAGE FROM THE CHAIRRALPH YOUNG2023 marked the tenth anniversary of Melcor REI

12、T.While we celebrated this milestone,the REIT continued to navigate significant challenges in the real estate industry,particularly affecting office and retail commercial assets.The REITs operations were negatively impacted by general economic conditions experienced by all commercial property REITs

13、across Canada and the USA.Our portfolio of diversified real estate assets and our conservative financial strategies provided some relief compared to some of our small cap peers.Considering the many headwinds in the industry,our board is satisfied with the operating teams performance,which generated

14、reasonable results in 2023.The Alberta economy played a role in mitigating the impacts felt by comparable REITs across Canada.The REIT began exploring strategic alternatives and took proactive steps in early 2023 by listing non-core assets for sale,ramping up an aggressive leasing program,controllin

15、g non-essential capital expenditures and addressing upcoming financial obligations.We have now sold our assets in British Columbia,and continue to see interest in our listed assets in Saskatchewan and Lethbridge.While this work is ongoing,the anticipated outcomes have been slower to materialize than

16、 hoped.In February 2024,the REIT board made the difficult decision to suspend distributions and at the same time engaged a strategic advisor.The distribution suspension will conserve financial resources while we reassess our strategic path forward.Our focus is to safeguard the REITs ongoing operatio

17、nal and financial health.The board of trustees managed the transition of two valued trustees,Larry Pollock and Carolyn Graham,who both served with distinction through challenging times.Mr.Pollock,a founding and Lead Trustee,offered 42023 Annual ReportMESSAGE FROM THE CEOANDREW MELTONIt is my privile

18、ge to report on the REITs 2023 results.The year was characterized by rising costs due to inflation,elevated interest rates and a shifting market landscape,particularly in office real estate.Despite these headwinds,we stayed true to our philosophy of focusing on real estate fundamentals,resulting in

19、stable operating performance and another year of strong leasing activity.The challenges we face today are not from operational inefficiencies but rather from broader economic factors impacting cash flow.These rising costs are felt across the industry and are not unique to our properties.In 2022,infl

20、ation and rapidly rising interest rates hit hard.The Bank of Canadas key interest rate spiked from 0.25%in March to 4.25%by the end of 2022,and has remained steady at 5.00%since July 2023.This rapid increase eliminated any opportunity to adapt strategically and has been particularly problematic for

21、REITs.Our approach this past year was methodical,concentrating on debt reduction to curtail interest expense and fortify our balance sheet.We reduced debt by 7%or$40 million.We also strategically listed assets outside of Alberta and in Lethbridge for sale.We sold Kelowna Business Centre in early 202

22、3,and as of May 10,2024,weve sold our remaining Kelowna asset,Richter Street.We continue to see interest in our Saskatchewan and Lethbridge properties.Our intention is to create liquidity and concentrate our remaining assets in the markets we know best.Our property management,leasing,and corporate s

23、upport teams continue to excel,enhancing the quality of service and tenant care.This has been pivotal in achieving a high tenant retention rate and an increase in committed occupancy.Our retention rate was strong at 88%up from 86%in 2022.Occupancy remained stable at 88%with committed occupancy of 89

24、%.Our average rent(WABR)improved 3%to$17.06 per square foot and the average lease term remaining increased to 4.31 years,up from 4.25 years at the end of 2022.Each of these improvements is a solid testament to managements effectiveness in focusing on the things it can control.We will remain focused

25、on those things,including the tenant experience and engaging new tenants to fill vacancies to mitigate rising costs.With our$46 million debenture maturing this December,we are focused on cash management.In addition to the debenture,operating cash outlays are up across the board incentives to close t

26、enants,finance costs,and operating and capital expenditures exerting pressure on operating cash flow.As a result,the Board of Trustees made the prudent decision to suspend distributions and initiated a strategic review process to evaluate alternatives for maximizing unitholder value.This process is

27、overseen by the Independent Committee(Richard Kirby,chair,Barry James and Bernie Kollman)and is supported by management.To date,the Independent Committee has engaged DLA Piper(Canada)LLP as legal and BMO Capital Markets as financial advisors.As we forge ahead,our agenda is clear:to focus on managing

28、 our debt efficiently,keeping our properties in excellent condition,and ensuring the sustainability of our operations as we await any eventuality or outcome of the strategic review process.2023 Annual Report56MELCOR REIT PROPERTIES MAPBRITISH COLUMBIAALBERTALETHBRIDGELEDUCSPRUCE GROVEGRANDE PRAIRIER

29、ED DEERAIRDRIECHESTERMERE111111121CALGARYEDMONTON242141162023 Annual Report8OFFICE BUILDINGSLOCATIONGLAOCCUPANCY100 Street PlaceEdmonton 44,295 73%10117 Jasper AvenueEdmonton 134,602 61%Birks BuildingEdmonton 35,106 94%Capilano CentreEdmonton 45,487 70%Crowfoot BuildingCalgary 69,365 85%Executive Te

30、rraceRegina 41,982 82%Kensington RoadCalgary 23,932 100%LFS BuildingLethbridge 33,196 100%Melcor CentreLethbridge449,86292%Melton BuildingEdmonton 114,612 58%Parliament PlaceRegina 28,663 90%Princeton PlaceEdmonton 61,222 78%Select BuildingEdmonton 23,432 100%Stanley BuildingsEdmonton 34,949 94%Ster

31、ling CentreEdmonton 69,491 88%Trail Business CentreEdmonton 79,578 70%Village at Blackmud CreekEdmonton 48,335 98%Westcor BuildingEdmonton 73,373 33%Westgate CentreEdmonton 75,088100%White Oaks SquareEdmonton 30,521 89%RETAIL BUILDINGSLOCATIONGLAOCCUPANCYChestermere StationChestermere 84,615100%Coas

32、t Home CentreEdmonton 59,854 79%Kingsview MarketAirdrie 99,987 100%Leduc CommonLeduc 283,346 100%Liberty CrossingRed Deer 64,240 76%Market MallRegina 42,912 93%Melcor CrossingGrande Prairie 283,111 92%Staples CentreCalgary 23,238100%The DistrictCalgary 56,084100%Towers MallRegina 113,493 100%Univers

33、ity Park MallRegina 41,380 80%Village at Blackmud CreekEdmonton 9,046 87%West Henday PromenadeEdmonton 77,970 98%Westgrove CommonSpruce Grove 29,384 100%White Oaks SquareEdmonton 127,827 98%INDUSTRIAL BUILDINGSLOCATIONGLAOCCUPANCYLethbridge IndustrialLethbridge 49,005 100%TelfordLeduc 143,118 100%TK

34、E BuildingEdmonton 15,968 100%LAND LEASE COMMUNITYLOCATIONUNITSOCCUPANCYWatergroveCalgary308100%SASKATCHEWANREGINA32Richter Street(office,Kelowna,BC)sold on May 10,2024.CORPORATE GOVERNANCEWe are committed to effective corporate governance practices as a core component of our operating philosophy.St

35、rong governance practices lay the foundation for a sustainable company and long-term value creation for our unitholders.As governance practices evolve,we periodically review,evaluate and enhance our governance program.Here are a few highlights of our program:INDEPENDENCEThe majority of our trustees

36、are independent.Committees are comprised of 100%independent trustees.The independent trustees meet in camera(without management and related trustees)for a portion of each in person meeting held.As our chairman is related,we have appointed a lead trustee,Richard Kirby,who is independent.Mr.Kirby chai

37、rs the in camera sessions and ensures that the board conducts itself in accordance with good governance practices.Each of the arrangements with Melcor(Asset Management,Property Management and Development and Opportunities Agreements)require the agreement of the majority of independent trustees,provi

38、ding independent oversight on all transactions to represent the interests of minority unitholders.ALIGNMENT WITH UNITHOLDERSEffective July 1,2023,all trustees and officers are required to hold the dollar-value equivalent of two times the annual trustee retainer,ensuring alignment with unitholder int

39、erests and a focus on long-term value creation.Additional information on our governance practices can be found in our 2024 Information Circular.INTEGRITY:THE HEART OF OUR BUSINESSThe highest standard of ethical conduct has always been at the heart of our operating philosophy.All employees,trustees a

40、nd officers follow our Code of Business Conduct and Ethics,which governs the work environment,regulatory compliance and the protection of our assets and reputation.The Code can be found on our website at MelcorREIT.ca.Melcor employees who manage our properties follow the Melcor Code of Business Cond

41、uct&Ethics,which is essentially the same.STRATEGIC PLANNING PROCESSThe board ensures that we establish a solid strategy designed to optimize unitholder value.This process includes active consultation with management on the issues,business environment,assumptions,goals and financial budgets that unde

42、rpin the strategy and ensures that risk levels are appropriate.To keep the board fully informed and engaged in the strategic issues and critical risks of our business,one meeting each year is dedicated to a strategic review of the portfolio and its operation.82023 Annual Report2024 BOARD OF TRUSTEES

43、NOTES1.All trustees are members of the Investment Committee,which did not meet in 2023.2.Barry James and Brandon Kot were appointed to the Board on April 16,2024.3.Denotes committee chair.4.Mr.Melton and Mr.Young are directors and Ms.Stefura is the Chief Operating Officer and Chief Financial Officer

44、 of Melcor Developments,which owns 55.4%of the voting units of the REIT.They are the Melcor nominees to the REIT board.Naomi Stefura MPAcc,CAEdmonton,Alberta,CanadaRelated3 COO&CFO,Melcor DevelopmentsTrustee since2022Attendance100%Compensation$Unitholdings21,560Committees1Ralph Young MBA,PEngEdmonto

45、n,Alberta,CanadaRelated3(Chair)Corporate DirectorTrustee since2013Attendance100%Compensation$41,500Unitholdings26,800Committees1Richard KirbyMBA,LLB,ICD.DTrustee since2019Attendance91%Compensation$37,500UnitholdingsCommittees1Audit,Governance3,Independent3Edmonton,Alberta,CanadaIndependent President

46、,Midnight Sun FinancialBernie KollmanICD.DTrustee since2021Attendance100%Compensation$39,000Unitholdings10,000Committees1Audit,Governance,IndependentEdmonton,Alberta,CanadaIndependent Corporate DirectorAndrew MeltonTrustee since2013Attendance100%Compensation$Unitholdings144,025Committees1Calgary,Alb

47、erta,CanadaRelated3 CEO,Melcor REITBrandon KotTrustee since2024Attendancen/aCompensationn/aUnitholdingsCommittees1Audit,GovernanceEdmonton,Alberta,CanadaIndependent Managing Partner,Canada ICIBarry James FCA,FCPA,ICD.D Trustee since2024Attendancen/aCompensationn/aUnitholdings2,800Committees1Audit3,I

48、ndependentEdmonton,Alberta,CanadaIndependent Corporate Director2023 Annual Report9 Doubling the benefits for psychological services.Management training like The Working Mind to recognize and manage mental health issues.Maintaining diversity with 51%of the management team being female and 30%visible

49、minorities,and half of the executive team is also female.GOVERNANCEOur commitment to robust corporate governance practices remains integral to our operating philosophy,ensuring sustainability and long-term value for our unitholders.Significant governance practices as of December 31,2023,include:Majo

50、rity of trustees(4 of 7)are independent,with an independent lead trustee overseeing board activities.43%of the full board and half of the REITs executive team are female.All arrangements with Melcor are reviewed by a majority of independent trustees,safeguarding minority unitholder interests.Introdu

51、ction of a minimum unitholdings requirement for trustees effective July 1,2023,where trustees must hold the dollar-value equivalent of two times the annual trustee retainer.Continuous annual review of our corporate governance practices to align with industry best practices.The audit,compensation and

52、 governance,and independent committees are comprised of 100%independent trustees.ENVIRONMENTAL COMMITMENT SOCIAL RESPONSIBILITY&GOVERNANCEENVIRONMENTAL COMMITMENTOur property management practices are designed to improve operating efficiency and reduce cost while at the same time increasing client sa

53、tisfaction and retention rates.Our capital spending strategy focuses on equipment upgrades and maintenance initiatives that will reduce energy consumption.Key examples of our commitment to sustainability and environmental best practices include:LED lighting implemented in all properties.Motion-sensi

54、ng lights utilized in 80%of office properties to conserve electricity.Active recycling programs in all buildings.From 2012 to 2023,we have monitored 12 properties,achieving:18%reduction in electricity consumption,or CO2 equivalent of 10,400 tonnes.22%reduction in natural gas consumption,or CO2 equiv

55、alent of 1,200 tonnes.51%decrease in emission intensity,or CO2 equivalent of 14,200 tonnes.SOCIAL RESPONSIBILITYMelcor Developments Ltd.,our asset and property manager,continues to cultivate a diverse,inclusive,and safe work environment,placing people at the core of its strategy.Key initiatives incl

56、ude:The REIT is committed to corporate sustainability in environmental practice,social responsibility,governance of our Trust and as stewards of the areas where we operate.Attaining best practice in all aspects of our business is our constant aspiration.102023 Annual Report14DIGITAL MEETING We are p

57、leased to present our 11th annual unitholder meeting digitally.You may vote in advance or online during the meeting by following the instructions included in your meeting package.Tuesday,June 25,2024|9:30 am MTMeeting Access: Meeting ID:289 110 059 Meeting Password:MRUN24PROXY DEADLINE:Friday,June 2

58、1,2024|9:30 am MTAGM MATERIALS:melcorreit.ca/2024AGMUPCOMING REPORTING DATESQ2-2024 July 30,2024Q3-2024 November 4,2024FY/Q4-2024 TBDDates are subject to change without notice.Visit MelcorREIT.ca for current information.TENANT SERVICESCORPORATE&UNITHOLDER INFORMATIONTSX LISTINGS Units:MR.UN 5.10%Con

59、vertible Debenture:MR.DB.BLEGAL COUNSEL Bryan&Company LLPAUDITORS PricewaterhouseCoopers LLPINVESTOR RELATIONS P.1.855.673.6937 E.IRMelcorREIT.ca2023 TAX INFORMATION(RETURN OF CAPITAL CLASSIFICATION)Regular income-49.45%Capital Gain-33.65%Return of capital-16.90%UNITHOLDER SERVICESOdyssey Trust Traders Bank Building 702 67 Yonge Street Toronto,ON M5E 1J81.888.290.1175https:/We invite tenants to submit service requests online at melcare.ca.Suite 900,10310 Jasper Avenue Edmonton,AB T5J 1Y8780.423.6931 1.855.673.6931IRMelcorREIT.cawww.MelcorREIT.ca