WINNIPEG, ON, Aug. 7, 2025 /CNW/ - Artis Real Estate Investment Trust ("Artis" or the "REIT") (TSX: AX.UN) (TSX: AX.PR.E) (TSX: AX.PR.I) announced today its financial results for the three and six months ended June 30, 2025. The second quarter results in this press release should be read in conjunction with the REIT's consolidated financial statements and Management's Discussion and Analysis ("MD&A") for the period ended June 30, 2025. All amounts are in thousands of Canadian dollars, except per unit amounts or as otherwise noted.

"Leasing activity remained steady across all of Artis's asset classes during the second quarter," said Samir Manji, President and Chief Executive Officer of Artis. "Occupancy improved to 87.8% as of June 30, 2025, up from 87.1% at the end of Q1, driven by the commencement of a significant 80,600 square foot lease at a U.S. industrial property. We delivered solid rental rate growth of 3.6% on 210,643 square feet of renewals, reflecting the strength of our portfolio and leasing strategy. We continue to maintain a disciplined approach to capital management, with a conservative debt-to-gross book value ratio of 41.1% at quarter-end. With additional dispositions underway, we expect further improvement in this metric, enhancing our liquidity and positioning us to capitalize on high-quality opportunities that drive long-term value for our unitholders. Our focus remains clear: maximizing value for our owners."

SECOND QUARTER HIGHLIGHTS

Portfolio Activity

   -- Disposed of one retail property located in Canada for a sale price of 
      $4.8 million. 

Balance Sheet and Liquidity

   -- Repaid the Series E senior unsecured debentures upon maturity in the 
      amount of $200.0 million. 
 
   -- Utilized the NCIB to purchase 1,771,089 common units at a 
      weighted-average price of $7.28 and 58,900 preferred units at a 
      weighted-average price of $20.04. 
 
   -- Reported Total Debt to GBV (1) of 41.1% at June 30, 2025, compared to 
      40.2% at December 31, 2024. 
 
   -- Improved Adjusted EBITDA Interest Coverage Ratio (1) to 2.29 for the 
      second quarter of 2025, compared to 2.05 for the second quarter of 2024. 

Financial and Operational

   -- Reported portfolio occupancy of 87.8% (89.0% including commitments) at 
      June 30, 2025, improved from 87.1% at March 31, 2025. 
 
   -- Renewals totalling 210,643 square feet and new leases totalling 126,306 
      square feet commenced during the second quarter of 2025. 
 
   -- Weighted-average rental rate on renewals that commenced during the second 
      quarter of 2025 increased 3.6%. 

BALANCE SHEET AND LIQUIDITY

The REIT's balance sheet metrics are as follows:

 
                                              June 30,     December 31, 
                                              2025         2024 
 
Total investment properties                   $ 2,258,583   $ 2,372,878 
NAV per unit (1)                                    12.98         13.75 
Total Debt to GBV (1)                              41.1 %        40.2 % 
Total Debt to Adjusted EBITDA (1)                     7.4           6.2 
Adjusted EBITDA interest coverage ratio (1)          2.29          2.47 
 
 
 
(1)  Represents a non-GAAP measure, ratio or other supplementary 
      financial measure. Refer to the Notice with Respect 
      to Non-GAAP & Supplementary Financial Measures Disclosure. 
 

At June 30, 2025, Artis had $16.6 million of cash on hand and $78.4 million available on its revolving credit facilities. Under the terms of the secured credit facilities, the REIT must maintain certain financial covenants which limit the total borrowing capacity of the credit facilities. At June 30, 2025, the total borrowing capacity of the secured credit facilities was limited to $514.5 million.

Liquidity and capital resources may be impacted by financing activities, portfolio acquisition, disposition and development activities or debt repayments occurring subsequent to June 30, 2025.

FINANCIAL AND OPERATIONAL RESULTS

 
                Three months ended              Six months ended 
                June 30,                        June 30, 
$000's, except  2025      2024      % Change    2025       2024       % Change 
per unit 
amounts 
 
Revenue         $ 59,082  $ 84,729    (30.3) %  $ 121,384  $ 165,149   (26.5) % 
Net operating 
 income           30,729    47,888    (35.8) %     61,896     91,445   (32.3) % 
Net (loss) 
 income         (23,492)       765  (3170.8) %   (12,065)    (6,356)     89.8 % 
Total 
 comprehensive 
 (loss) income  (70,300)    12,298   (671.6) %   (59,662)     34,240  (274.2) % 
Distributions 
 per common 
 unit               0.15      0.15        -- %       0.30       0.30       -- % 
 
FFO (1)         $ 16,956  $ 28,698    (40.9) %   $ 34,491   $ 55,165   (37.5) % 
FFO per unit - 
 diluted (1)        0.17      0.27    (37.0) %       0.34       0.51   (33.3) % 
FFO payout 
 ratio (1)        88.2 %    55.6 %      32.6 %     88.2 %     58.8 %     29.4 % 
 
AFFO (1)         $ 8,204  $ 17,063    (51.9) %   $ 16,939   $ 31,641   (46.5) % 
AFFO per unit 
 - diluted (1)      0.08      0.16    (50.0) %       0.17       0.29   (41.4) % 
AFFO payout 
 ratio (1)       187.5 %    93.8 %      93.7 %    176.5 %    103.4 %     73.1 % 
 
 
(1)  Represents a non-GAAP measure, ratio or other supplementary 
      financial measure. Refer to the Notice with Respect 
      to Non-GAAP & Supplementary Financial Measures Disclosure. 
 

Artis reported portfolio occupancy of 87.8% (89.0% including commitments) at June 30, 2025, compared to 87.1% at March 31, 2025. Weighted-average rental rate on renewals that commenced during the second quarter of 2025 increased 3.6%.

Artis's portfolio has a stable lease expiry profile with 47.0% of gross leasable area expiring in 2029 or later. Information about Artis's lease expiry profile is as follows:

 
           Current  Monthly  2025     2026     2027     2028     2029&    Total 
                                                                 later    portfolio 
           vacancy  tenants 
 
Expiring 
 square 
 footage    12.2 %    0.1 %    7.7 %   13.5 %    8.8 %   10.7 %   47.0 %    100.0 % 
In-place 
 rents         N/A      N/A  $ 18.28  $ 16.37  $ 16.00  $ 16.76  $ 17.05    $ 16.91 
Market 
 rents         N/A      N/A  $ 17.45  $ 16.08  $ 15.67  $ 15.39  $ 16.22    $ 16.15 
 

UPCOMING WEBCAST AND CONFERENCE CALL

A conference call with management will be held on Friday, August 8, 2025, at 12:00 p.m. CT (1:00 p.m. ET). In order to participate, please dial 1-437-900-0527 or 1-888-510-2154. You will be required to identify yourself and the organization on whose behalf you are participating.

Alternatively, you may access the simultaneous webcast by following the link from our website at https://www.artisreit.com/investor-link/conference-calls/. Prior to the webcast, you may follow the link to confirm you have the right software and system requirements.

If you cannot participate on Friday, August 8, 2025, a replay of the conference call will be available by dialing 1-289-819-1450 or 1-888-660-6345 and entering passcode 26907#. The replay will be available until Monday, September 8, 2025. The webcast will be archived 24 hours after the end of the conference call and will be accessible for 90 days.

CAUTIONARY STATEMENTS

This press release contains forward-looking statements within the meaning of applicable Canadian securities laws. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. These forward-looking statements include, among others, statements regarding the timing and amount of distributions and the future financial position, business strategy, potential acquisitions and dispositions, plans and objectives of Artis. Without limiting the foregoing, the words "outlook", "objective", "expects", "anticipates", "intends", "estimates", "projects", and similar expressions or variations of such words and phrases suggesting future outcomes or events, or which state that certain actions, events or results "may", "would", "should" or "will" occur or be achieved are intended to identify forward-looking statements. Such forward-looking information reflects management's current beliefs and is based on information currently available to management.

Forward-looking statements are based on a number of factors and assumptions which are subject to numerous risks and uncertainties, which have been used to develop such statements, but which may prove to be incorrect. Although Artis believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Assumptions have been made regarding, among other things: the general stability of the economic and political environment in which Artis operates, treatment under governmental regulatory regimes, securities laws and tax laws, the ability of Artis and its service providers to obtain and retain qualified staff, equipment and services in a timely and cost efficient manner, currency, exchange and interest rates, global economics and financial markets.

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