Killam Apartment Real Estate Investment Trust

Good morning, ladies and gentlemen. Welcome to the Killam Apartment Real Estate Investment Trust Risk Order 2026 Financial Results Conference Call. At this time, our lines are listed in only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require assistance, please press star zero for the operator. This call is being recorded on May 7, 2026. I would now like to turn the conference over to Mr. Philip Frazier, President and CEO. Please go ahead.

Good morning, and thank you for joining Kilmer Private REIT's first quarter 2026 conference call. I'm here today with Robert Richardson, Executive Vice President. Thank you. Good morning, and thank you for joining Kilmer Private REIT's first quarter 2026 conference call. I'm here today with Robert Richardson, Executive Vice President, Dale Noseworthy, Chief Financial Officer, and Aaron Franklin, Senior Vice President for Finance. Flights to accompanying today's call are available on the Investor Relations section of our website under Events and Presentations. I will now ask Erin to read our cautionary statement.

Thank you, Philip. This presentation may contain forward-looking statements with respect to Killam Apartment Lease and its operations, strategies, financial performance conditions, or otherwise. The actual results and performance of Killam discussed here today could differ materially from those expressed or implied by such statements. Such statements involve numerous inherent risks and uncertainties, and although Killam management believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that future results, levels of activity, performance, or achievements will occur as anticipated. For further information about the inherent risks and uncertainties in respect to forward-looking statements, please refer to Killam's most recent annual information form and other securities regulatory filings found online on CDAR Plus. All forward-looking statements made today speak only as of the date which this presentation refers, and Killam does not intend to update or revise any such statements unless otherwise required by applicable securities law.

Thank you, Erin. We are pleased with the financial results in the first quarter, and we are pleased with the progress we are making during the important spring leasing season. We are seeing increasing market rents. and we expect an additional 60 basis point improvement to the same-property apartment occupancy based on April trends. During the first quarter, Kelly generated same-property apartment NOI growth of 4%, driven by same-property revenue growth of 3.6%. Our portfolio continues to demonstrate resilience, supported by strong demand for apartments across Atlantic Canada. With these results, we have increased both our same property revenue and NOI targets for the year. Updates to our strategic targets and performance to date are highlighted on slide two. Dale will take us through our financial results, followed by Robert, who will discuss the rental market fundamentals. I will conclude with an update on our capital allocation strategy. I will now hand it over to Dale.

Thanks, Bill. Key highlights of Kilmer's Q1 financial performance can be found on slide three. Kilmer net income of $50.3 million, which includes a $14.9 million in fair value gains, driven by same-property NOI growth across our portfolio. Funds from operations increased by 3% in the first quarter, which was primarily driven by consolidated same-property NOI growth of 3.9%, and positive contributions from the lease-up of the CARIC. These gains were partially offset by higher interest expense. AFFO increased 3.8%, reflecting the effectiveness of our capital recycling strategy over the last three years. AFFO per unit increased 4.3%. Looking more closely at operating performance, rental growth remains healthy across the majority of our markets. Bain property apartment revenue increased 3.6% year-over-year, with gains on both renewal and turnover activity, as shown in the bottom graph on slide 4. The weighted average rental increase combined for both renewed and turned suites was also 3.6% in the first quarter. In Q1, our average rental increase on new leases was 5%. This is typically a lower yielding period on rental increases due to the higher proportion of renewals in Q1, which are subject to rent control. With an average mark-to-market of 10% across our portfolio, we continue to see positive spreads on turnover. Based on spring leasing momentum, our outlook for same-property revenue growth has improved and is now expected to exceed our expectations from the start of the year. As a result, we have revised our targeted same-property revenue growth to above 3.5% for the year, up from a base of 3%. From a cost perspective, same-property operating expenses increased 3.2%, primarily driven by higher property taxes and wage-related operating costs. These increases were partially offset by lower utility and fuel expenses, as shown on slide 5, benefiting from the removal of the consumer carbon tax. Slide 6 highlights our debt metrics, as at March 31, 2026. Total debt, a percentage of total assets, was 42.2%, up slightly from 41.9% at the end of 2025. Debt to normalized EBITDA was 9.71 times, modestly higher than 9.66 times at year end, due primarily to the timing of development draws related to Brightwoods. We expect our debt to normalize EBITDA leverage metric to improve in G2 as stabilized NOI from Brightwood is added to normalize EBITDA. We remain comfortable with our debt profile and are focused on maintaining conservative debt levels. Our strategically staggered debt ladder, shown on slide 7, indicates we are in the final year of considerable refinancing headwinds. As we look ahead, year-over-year interest expense growth is expected to begin stabilizing in 2028, allowing a greater portion of NOI gains to flow through to FFO. I will now turn the call over to Robert, who will discuss operating performance across our markets in more detail.

Thank you, Dale. Atlantic Canada once again led Killam's portfolio for earnings growth, as shown on slide 8, revenue and performance. net operating income growth in Atlantic Canada remained above the portfolio average, utilized fewer incentives, and outperformed our total same property apartment portfolio occupancy by 50 basis points, maintaining occupancy at or above 97.5%. In Halifax, we have not seen any meaningful impact from new multifamily supply on leasing activity year to date. nor do we expect the impact to be as pronounced as some have predicted. As we look more closely at the underlying housing data, approximately one-third of suites currently under construction in the Halifax Census metropolitan area are located outside Halifax's core in sub-markets where Kiln does not operate. In addition to a centralized portfolio, Kiln's Halifax assets are primarily positioned within mid-market rent segments, as shown in the chart on slide 9, that do not compete directly with new apartments charging rents in the $2,500 per month range. The geographic and price point advantages support Kilham's strong leasing results in Halifax that require minimal, if any, use of incentives. The mark-to-market opportunity in Halifax, as shown on slide 10, is impressive, increasing surrender basis points to 18%, versus the 15% spread reported at year-end 2025. Halifax, referred to as the Warden of the North during the Second World War, is experiencing a bit of a renaissance given its strategic location. It expects to benefit from long-term economic drivers that will support strong apartment fundamentals for decades. More than $3.2 billion in total investments in Nova Scotia have already been announced by the federal government, and recently, the provincial government has highlighted additional investments across a number of sectors, including defense, energy, and critical mineral mining. Halifax, in particular, is emerging as a key hub within Canada's defense sector, which currently supports approximately 17,000 private sector jobs and $2.6 billion in GDP. New infrastructure activity related to energy projects such as offshore wind are moving forward and could produce enough power to meet nearly a quarter of Canada's total demand while employing thousands. Oil and gas projects have estimated reserves of almost 50 billion barrels of oil and nearly 150 trillion cubic feet of natural gas. These developments are expected to generate and support permanent population and employment growth in Halifax. reinforcing the long-term stability of rental demand. In Ontario and Alberta, market conditions are more competitive. Calgary and Edmonton continue to experience softer rental markets relative to Atlantic Canada, which is reflected in Alberta's more competitive rental rate adjustments on turnover and a higher use of incentives. Importantly, we remain selective and market-specific in our leasing approach, aligning pricing discipline with long-term value creation rather than short-term occupancy. Incentives across Kiln's portfolio increased modestly and continue to represent a small portion of revenue at less than 90 basis points of total same-property apartment revenue. Kiln is not seeing competitive leasing behavior that could materially impair long-term value. Despite elevated multifamily housing starts and slower Canada-wide population growth, Kiln's portfolio mark-to-market opportunity increased for the first time quarter over quarter since Q3 2023, that's two and a half years without an uptick. Albeit the increase is modest at 100 basis points, increasing from 9% in Q4 2025 to 10% in Q1 2026, this increase plus subsequent leasing activity year-to-date in Q2 2026 may indicate that rental rates have normalized as the market approaches the peak leasing months, supporting a stable rental market that enables top-line growth of 3% to 4% annually. Killam's property management platform continues to deliver admirably, attracting and housing discerning residents that are proud to call Killam property their home. I will now hand you back to Philip to take you through Killam's capital allocation strategy.

Thank you, Robert. Capital allocation remains a key focus for Killam. During Q1, we deployed over $6 million under our NCID, repurchasing units at a meaningful discount to NAV. And we expect NCID activity to increase for the remainder of 2026 alongside continued capital recycling. Given the persistent value disconnect, we also suspended our drip effective April 24th. On March 24th, we announced the increase in our disposition target to $150 million. We had a number of MAC properties under contract with closings expected in the second half of 2026. We see an opportunity to crystallize value and redeploy capital and focus on our high-quality apartment portfolio. Importantly, this is not a short-term shift. We view capital recycling of non-core or low-growth assets as a recurring component of our strategy, which will allow us to improve our portfolio. Longer term, we are targeting annual dispositions of up to $200 million per year, subject to market conditions and pricing. Over the past 15 years, Killam has developed over 2,300 high-quality, energy-efficient apartment suites, which operate at some of the highest margins in our portfolios. Many of these properties offer suites with affordable rents by utilizing CMHC funding and programs beginning in 2011 with our Charlotte Court and more recently with our Carrick development in Waterloo, Ontario. With an overall average portfolio of 29 years, our portfolio of newer assets allows for flexibility when it comes to value-enhancing opportunities as well as lower maintenance costs. Currently, we do not expect to start any new developments in the near term due to market conditions and policy changes in some of our key development locations. For example, recent building restrictions imposed in Kitchener, Waterloo, and some parts of Cambridge due to shortage of water for the region have stopped all new development for the foreseeable future. Slides 12 and 214 highlight Brightwood. our 128-suite building in Waterloo, which was completed in record time. From start to finish, it took 16 months to complete and came in under budget. The property is currently 23% leased, and we welcomed our first tenants last Friday. We expect the property to be fully leased by the fourth quarter. In Halifax, construction will be even tight. Our 55-suite development on Slides 15 and 16 will is expected to be completed in Q4. This leaves Eventide in our 10% interest in Nolan 3, located in Calgary, has our active developments and represents less than 1% of the total value of our portfolio. We believe our balanced approach to capital allocation hitting into the promising leasing season positions Cone to deliver sustainable FFO per unit growth. while maintaining flexibility as market conditions evolve. Higher for longer interest rates reinforce the importance of balance sheet discipline in capital allocation. To conclude, we are very pleased with our Q1 2026 performance and remain committed to investing in our portfolio, executing our overall strategy, and creating value for all of our unit holders. I would like to thank our employees for their hard work and dedication. Thank you. And I will now open up the call for questions.

Thank you. Ladies and gentlemen, we now begin the question and answer session. If you would like to ask a question, please press star, follow the number one on your telephone keypad. If your question has been answered, would like to withdraw from the queue, please press star, follow the number two. And if you're using a speakerphone, please lift your hand so that we're pressing any keys. One moment, please, while we compile the roster. The first question comes from Jonathan Kalsher with TD Cowan. Please go ahead.

Thanks. Good morning. Good morning. First question, just on the capital allocation and the MHC portfolio, I think you're carrying at about $240 million on the books right now, and if you're targeting $150 million and a lot is targeted towards the MHC, how should we think about that segment of your business going forward?

Well, I think over time it's going to be reduced. So as we mentioned, Jonathan, we've had a number of properties under contract. We've been working on these properties in terms of disposing of them since really late Q4 of 2025. And there's two big crunches, and we expect them to close in the second half of the year.

Okay. And would that be – Once those close, will that get you to the low end of your disposition target, or are you going to have to sell some apartments too?

Well, we're looking at other – those two deals alone are over $100 million. We're looking at other opportunities on the MHC site, and we're also looking at opportunities to dispose apartments as well.

Okay. And then I guess the majority – of the equity proceeds will be targeted towards the NCIP. Are you also looking at any acquisitions, any opportunities?

We are looking at no acquisitions at this time. Okay. And then just, sorry, go ahead.

No. Okay. And then just one on the operations, the increase in occupancy in April, obviously a pretty good start to the spring leasing season. Was that consistent across the portfolio, or is it still mostly being driven by Atlantic Canada? It's led by Atlantic Canada, but it's across the portfolio.

Okay. That's it from me. I'll turn it back. Thanks.

Thank you. Thank you. Your next question comes from Brad Sturges with Raymond James. Please go ahead.

Hey, good morning. Just following on Jonathan's question there, then would it be fair to say that, I guess, over the next few years, you would, given you're reducing your operating scale on AMHC, that you could potentially exit that segment altogether?

Well, I mean, we're into that sort of decline in terms of the percentage that we sort of produce for the company overall. It will take a couple of years to sort of finalize that if we choose to do it, but there's such demand for these assets today is that we're going to seize the opportunities in front of us.

And what you've got under contract now or looking to sell, is there a specific region within that AMHC portfolio, or is it kind of broad across the – broad cross-section across the markets you're in?

The deals tend to be focused regionally. And I guess just –

I guess on the question around, it sounds like the leasing market for the spring season has been picking up. I guess how would the demand picture look today versus where you were last year? Are you seeing incremental differences between this year and last year in the spring leasing season?

I'd say better. I think last spring, certainly when we were through the summer, it was more flat, and then we saw an increase in vacancy. last fall. So I'd say the momentum we're seeing this year is better than last year.

Okay. I appreciate it. I'll turn it back. Thank you.

Thank you. Your next question comes from Jamie Chang with RBC Capital Markets. Please go ahead.

Thank you. Yeah, so I just wanted to get some context around the capital allocation shift, if you will. I guess the reason to get out of MHC, was that more of a function of demand? Is that sort of why you decided to get out of business? We're not out of the business.

We're not out of the business. Over the last three years, we've concentrated on apartments a lot of times in locations that there was no future growth in those areas. We sold a couple of MHCs last year, and the interest the rate of interest was on the MHC, so we started doing that at the end of last year. So that's where that comes from. And over time, you know, you get to the point where we will sort of diversify and sell off a number of those assets.

Okay. Sorry.

Well, similarly on the buyback, I think this is probably the most active we've seen killing on that. to improve that shift?

Well, I think it's the persistent level of our share price and relative to where the sort of the acquisition market is, it makes the most sense to do it. And believing that there's not another war, another sort of economic event that we can't control, now is the time to do it.

That's good. And then on the operating side, so I think I read somewhere about, in your MDNA, about some of the urban core assets are being redeveloped to actually subtract supply. Is that part of the reason you think that you haven't really seen kind of that supply impact and why you're seeing pretty good momentum in your market rent? Can you quantify sort of what that potential impact is?

I don't think that alone is the reason we're seeing it. I think it has more to do with, you know, people want to be in the core of the city and the regions that we're located in are very good locations in the city. And our rents overall are affordable. So that's spread when the old versus new. Certainly there has been that redevelopment is a factor, but I wouldn't say that that's the reason we're not seeing the impact of new supply. I think it's the offering that we have. compared to the rent.

Okay. No, I mean, the market-to-market rent, how fast is it moving from 15 to 18? Pretty big move. Is that momentum in the market, or did that surprise you at all?

I think we're happy with the growth. Did it surprise us? A little bit, but the market has been strong.

Okay. Okay. Great. Thank you. Thank you. Your next question comes from Kyle Stanley with Desjardins. Please go ahead.

Thanks. Morning, everyone. Just going back to the kind of the occupancy momentum, especially into April here, you've talked about it a little bit, but, you know, I'm just wondering what are the main drivers that you think are driving this, you know, strength in the underlying market? And Obviously, you mentioned last year seeing the seasonality with things being relatively flat in the summer and then softening in the fall. Do you expect a similar trajectory for the year ahead?

I mean, I think we are back to the norm of having some seasonality. We're just getting going on this season, which tends to peak in September. So, you know, if you go back to historic norms, I think that that's reasonable to expect. I think when we see the momentum that we've had and where it's coming from, one is our leasing and property management teams being very nimble to make sure that we've got the right pricing and we're doing the right amount of upgrades. If required, we've actually slowed down the amount of repositioning we're doing. Affordability is absolutely where the biggest demand, you know, more affordable units. So we are being strategic in terms of that.

Yeah. I mean, where the demand is coming from is really the federal government. on the defense side. I mean, the announcements they actually have announced, there's a lot of sort of behind-the-scenes or early consulting, getting design work done, and all those projects across not just Halifax, but also New Brunswick and Newfoundland. And that's as real as it gets. Money is being spent today on that. And even recently, I mean, the federal government picked up 540 acres of land over On the Dartmouth side, they also purchased an apartment building that was finished that hadn't even started leasing for close to $80 million close to our properties over there by Maplehurst. So they're spending money, and we're going to see the economic spinoff from that.

Okay. No, I mean, that kind of goes to my next question because, again – been touched on already on the call about how strong Halifax was. And obviously, we've seen all the announcements, but was unsure if money was actually being spent and jobs created already. So it's interesting to hear that and probably helps explain the strength. So that's helpful. One thing you mentioned just on Kitchener, Cambridge, Waterloo, and kind of the halting of new development as it relates to lack of water. Is that something you see being an issue across the country or in some specific markets? And maybe that is the you know, the thing that gets supply a little bit more in check until we see a shift in population growth again?

Well, I think it's all over the country at different sort of stages and levels. I mean, the most dramatic one is the Kitzer-Waterloo area that basically last November they said no more permits for nothing, for a single-family home, for a new apartment building. Everything is on hold. And here it is now five months later. and nothing's getting done. So that has a real impact on the local construction economy there. We're seeing signs of that in different ways, not so much on capacity of water, but in some areas in Halifax, they are relative to doing the testing because when they go to get your water permit, that there might not be enough water for the area. But we're also seeing it on the wastewater side of in terms of Halifax, where that capacity is very constrained in a number of areas of the city.

Okay. Okay. Well, that's interesting.

Thank you. Just the last one. Anything you wanted to highlight on the kind of leasing or repositioning effort at White Mountain?

We just took possession of it on April 1st. We started demolition, and we're in taking the leaseholds out, and preparing for one tenant that we're working with that's going to be moving so we can have additional retail to offer in the marketplace. And so we're making good progress on that. And we think that the program will take 24 months.

Okay. Okay. Perfect. Thank you very much. Thank you. Your next question comes from my side. Please go ahead. Hi. Good morning.

Coming back to the 60 basis point occupancy uplift, the first time I think since 2021 where we saw a sequential move, Q2 versus Q1, or at least Q2 so far, is it your sense that the 60 basis points, is that a killing thing or is that a broader market thing in terms of the markets that you operate in? Like how much of it is specific to what killing is doing versus kind of just generally the broader market? in these markets is the strongest one?

I think it's a bit of both. I'd say part of it is the way we're executing, but I'm also hearing that competitors around us have less vacancy, so a greater market. I think people are coming back, so I would say it's half and half.

Okay. And then I think last quarter, Philly kind of outlined seven or eight projects in the Halifax area that should create jobs over time. And it sounds like maybe some of that's impacting the numbers right now. A high level, if those seven or eight projects are going to create, let's say, 100 jobs over, I don't know, 15, 20 years, Are we at five jobs created thus far, 20, 40? Can you provide a bit of context in terms of where we are in that game today in terms of job creation that may be impacting? We are at the very, very early stages, Mario, of that.

Okay. Yeah. Yeah. Okay.

Some of these projects could be explaining what you're hearing or what you're seeing on the ground, but it's a far cry from ultimately what... Absolutely. Okay. And the market-to-market boost of a percent was surprising to us at the very least. You know, your occupied rent growth was up a percent quarter-to-quarter as well, so that would kind of imply 2% market rent growth sequentially. I guess my question is, is the 2% kind of a same property basis, or is some of that increase in market rent attributable to new supply coming into the market at a higher rent?

The same property, but just remember when we're doing our mark-to-market, it's being compared to December, which is not prime leasing season. So that's part of it. We're always running it to say what could we have achieved at the end of the quarter versus what was in play. So I do think time of year is an important factor, but we are using a same property mix, so it's like for like when we're looking at that.

I think what else is impacting it is, The federal government has said to the Department of Defense they're going to increase the wages by 25% for new recruits. So they're starting to get more new recruits. They have more money in their pockets than they can stay on the peninsula. So I think that that is contributing to the increases that we're able to get in the marketplace.

And as we're seeing less vacancy, the conversations around the table are, okay, we're only dealing with two vacant units instead of eight at a certain property. Let's try moving the rents 25%. So it's just starting. It's not across the board. It's strategic depending on where the supply, you know, is coming from. So those are the conversations. It's a different approach to leasing when you only have a few vacant units versus, you know, a runway of a couple, you know, a couple of months of more vacancy coming. It changes the conversation. Right.

Okay. And then what percentage of the... In Halifax, would you say, are you hitting common tax allowable?

Sorry, I missed that.

What percentage of the lease renewals in Halifax are you hitting the allowable increase?

Not as many as we were, but we're probably averaging closer to... Four and a half percent?

Four to four and a half, yeah.

My last question, maybe just sticking to Halifax, do you have a sense of how incentives are trending with respect to some of the larger developments that are currently under lease?

So you're asking about incentives for new developments, not how we're using incentives?

Yeah, so not necessarily for your portfolio, but there is kind of a larger development that's under lease up today and just other kind of developments that are under lease up in the market. Do you have a sense of offered there and how that's changing.

I do get the incentive that some incentives are. We keep a close eye on that, and some are offering a month free. It's not standard across all developments, but there are incentives out there at some properties that are being leased out.

Okay. Thank you. Thank you. Thank you.

Thank you. Your next question comes from Sarim Srinivas with ATB Capital Markets. Please go ahead.

Thank you, April. Good morning, guys. Just going back to comments on, you know, how attractive our units are at these levels right now, although Coulomb is not focusing on the acquisition market, are you actually seeing a lot more volume sharing these kind of assets in the market right now?

I think it's slightly down from maybe last year.

What we're seeing is that inhering. CMAC or any type of financing is taking longer and longer. So, you've got to have a pretty good balance sheet to be a buyer these days.

All right.

And then, going back to your comment on, you know, how attractive the MSC units look right now, especially in this market. Can you talk about the buyer pool as such? Are these more people looking at it as land opportunities, or are they essentially just looking to operate it as a cash flow model? How are they looking at it?

Well, the MAC side is cash flow. They want the assets.

And I think all the apartments are the same as well. Fair enough. Thanks, guys. I'll turn it back.

Thank you. Thank you. Your next question comes from Dean Wilkerson with CBC Casual Markets. Please go ahead.

Thanks. Good morning, everyone. Phil, just on the buyback, obviously it's the best use of capital right now. I mean, you can sell assets at a five or better and buy back your units at an implied six. I guess even the sell-side analysts could make that work. How tight would that have to come in before you become – say, indifferent between going back into the market to buy assets or development, and at which point it would say, okay, maybe we've extracted all the capital that we can out of land-backed units.

I'll jump in for that one. I mean, it obviously depends what we're selling and what cap rate we're selling at, but I'd say, you know, we'd love to see the unit price come back to a 20, and I think at that point, the math can look different depending what acquisition opportunities are and what that growth profile would be. So it really does depend on both sides.

Yeah. Yep. I mean, it's just math, right? So it makes sense. And then just on the mark-to-market opportunity, do you think that it's more stabilized or perhaps, you know, looking at Halifax, looking at St. John, looking at St. John's, You know, if those trends continue, perhaps that mark-to-market opportunity does actually continue to increase from here, or do you think that 9%, 10% range is maybe sort of, you know, the pre-pandemic normal that we're back to?

A big question.

I'd say... Based on the momentum we're seeing, it's not unlikely to see that continue to pick up a little bit over the next quarter or two. I don't think we're going back to 15% and 20% anytime soon. But I do, with the demand that we're seeing and this affordable offering that we have, and that's where the strongest demand is, we may see that continue to move up. So it feels better than it has, and it does feel like I mean, we have seen an uptick more than stabilized. So there's a good chance we see that continue to move up through this busy leasing season.

Fantastic. That's all I have. Thanks.

Thank you. Thank you. Your next question comes from Matt Koronek with National Bank. Please go ahead.

Just on the capital recycling front, these are assets that you've held for quite some time and presumably the tax base has been ground down a bit. I know taxes have been an impediment in this country in terms of capital recycling. How will you kind of mitigate that. I know you can ultimately push it through to shareholders through special distributions, but we have heard some starting to complain about that process, so if you could give us a sense as to how to mitigate the capital gain tax implications.

Yeah, with those particular assets, we would be modeling it out, but likely looking kind of at a special distribution potentially this year, but it all depends exactly which assets close.

And when the time may come.

But it would be relatively small.

Makes sense. And then on the demand side, I mean, the population numbers that we continue to see don't look great. Now, it's hard to know whether the government is properly kind of measuring people departing the country. But based on what you're seeing, it seems like you've seen incremental increase in demand above and beyond kind of people making more money to pay higher rents. So... I'm just trying to square those two things. They seem counter. We would have thought we would see this, but maybe in 27 and 28, not the spring of 26. So I don't know if you have any incremental color there, but that's why you're seeing better than end.

I think some might be that a year ago we saw more people leaving. We would have heard from even some of those non-permanent residents, people's visas weren't being renewed. We had... more exodus, so then more units to fill. We are seeing less of that, so I don't know how much of that is to do with changes that some of those people that had to leave the country have left. We have changed our approach in terms of making sure that we are communicating with tenants in advance before they leave also to negotiate where that opportunity exists, but I would say we've seen less people leaving, so there's less units to catch up on which may be contributing as well.

Okay. That makes sense. It does seem like this is a broader theme, and we're looking at the population numbers and just scratching our head a bit. Maybe population is not shrinking at the pace that the government is saying it's shrinking at.

In Nova Scotia, our premier has made it clear that he wants to open up mining, the offshore, in terms of the wind farms, He really is pushing forward. He has a majority government. So the probability is that he can get it pushed through. And I think that people are looking and saying, okay, we're going to have some growth. If they were looking to leave, they probably are saying, if I wait a little longer and see, we can see what's happening with that. The other one is Amazon. It's in the paper today that they're going to have a 500,000 to 700,000 square foot fulfillment center, and they're going to build it in Burnside. So, you know, that type of, you know, that size will have people able to find quite a few jobs. The mining alone could be massive, like in the hundreds and close to a thousand. So, it is, people are talking about

Maybe just on the supply side, I mean, the topography of Halifax and the infrastructure don't make it the easiest place to get around if the population is going to grow substantially. So are there limitations at this point in terms of kind of incremental new supply? I know there's been a lot built, but it's not necessarily downtown.

I was going to make a joke earlier about supply. The reason they're still here is they can't get off the peninsula. So you've touched on it. I can go there. Yeah, without a doubt, we have some infrastructure issues. And here where we are located in Halifax, they're going to be taking up a fair bit of the intersection to try and address some of that. But we have to, I think, find a way to work with it because the people are here and more do want to come.

Matt, just again, you touched on the supply side. CMAC did a report there at the end of January talking about the units under construction in the region. And basically, their number for all of Halifax is 12,297 under construction over a four-year period. So that's about 3,000 units. And really, there's a few larger developments that will take all that time. But even 3,000 units is just slightly above what we've been able to absorb for the last 15 years. And you're only looking at essentially a population of 7,000 to 8,000 to 9,000 people per year to absorb all that and still have the tight sort of conditions.

Yeah, no, that's fair. I think we've looked at supply, but it's really been a demand issue for the last little while, and things like that have just come about.

Okay, thanks, guys. Appreciate it. Thank you. Your follow-up question comes from Mario. Please go ahead.

Hi, sorry, one more for me. Just on the MHC side, given the scarcity of the product in the country, is it fair or is it reasonable to think that given it's being potentially sold in too large tranches, is it fair to think about perhaps a premium diet for us in terms of valuation being targeted?

Sorry, I missed that last part. Did you ask me if it's close to diet? We've had a premium diet for us.

Yeah, given the kind of larger portfolio sale, the fairly scarce product, is it reasonable to expect a premium, a portfolio premium? Well, I think you're answering the price.

We would expect to be generally in line with IFRS.

Okay, thank you.

Thank you. There are no further questions on the phone line. I will turn the call back to Mr. Fraser for closing remarks.

Thanks for participating and listening to our call today, and we look forward to reporting our Q2 results on August 5, 2026. Thank you.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating.