Ottawa-based Minto Apartment REIT says tenants continued to pay rent at a typical rate in May, adding the company remains in a “strong financial position” despite the COVID-19 crisis.
The local real estate firm said Wednesday its funds from operations – a key cash-flow metric for REITs – rose more than 65 per cent in the first quarter of 2020 to $12.1 million compared with $7.3 million a year earlier.
Average monthly rents on the more than 4,500 properties the REIT has owned for at least a year jumped 12.8 per cent from $1,417 in March 2019 to $1,599 in March of this year.
“We capitalized on strong rental market conditions in Toronto, Ottawa and Montreal during the first quarter of 2020, generating solid growth in all of our key financial metrics,” Minto REIT chief executive Michael Waters said in a statement.
“Obviously, the economic outlook shifted very significantly in March due to the impact of COVID-19. While the financial impact from the virus has not been material to the REIT to date, we are continuing to monitor the situation closely and are committed to working with our tenants during this difficult period.”
As the widespread economic fallout from COVID-19 became clear and job losses began to mount, many observers questioned if tenants would be able to continue making monthly rent payments. Minto REIT says it has collected more than 90 per cent of May rent payments so far, a figure “in line with normal collection patterns.”
The company said 96.8 per cent of its available unfurnished suites were occupied at the end of the April, down from 98.8 per cent a year earlier.
In an update in mid-April, the REIT said it was putting a freeze on planned rent hikes for April, May and June and was offering deferments to tenants who couldn’t afford to make payments during the pandemic.
Minto REIT owns 29 multi-residential properties in Ottawa, Toronto, Montreal, Calgary and Edmonton with more than 7,200 apartment units. The company’s shares were down 25 cents to $20.06 in late morning trading on the Toronto Stock Exchange.