Dream Impact Trust

Good morning, ladies and gentlemen. Welcome to the Dream Impact Trust third quarter conference call for Tuesday, November 5, 2024. Please be advised that all participants are currently in listen-only mode and the conference is being recorded. After today's presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star then zero. During this call, management of Dream Impact Trust may make statements containing forward-looking information within the meaning of applicable securities legislation. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties. many of which are beyond the trust's control that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. Additional information about these assumptions and risks and uncertainties is contained in the trust's filings with securities regulators, including its final long-form prospectus, These filings are also available on Dream Impact Trust's website at www.dreamimpacttrust.ca. Your host for today will be Mr. Michael Cooper, Portfolio Manager. Mr. Cooper, please proceed.

Thank you, operator. Good morning, everybody, and welcome to Dream Impact's Q3 conference call. Today I'm here with Megan Peloso. Megan's going to speak in a couple minutes about the quarter. I thought I might, after she's done, speak a little bit about what I'm seeing in the real estate industry generally and how it's really affecting dream impact and what's happened with sort of the macro conditions. We've had a pretty good quarter in terms of making progress, so I thought I'd go through a fair amount of detail and share with you our position on the various assets. Megan, do you want to start, please?

Sure. Thank you, Michael, and good morning, everyone. We entered the quarter with cash on hand of $23.8 million. In the quarter, we closed on the sale of 10 lower Spadina and $349 car law for net purchase of $30.1. Using sales proceeds, the outstanding balance of $7 million on the trust credit facility was immediately repaid in full. Over the quarter, we completed a significant amount of financing activity, attaining extensions for approximately $130 million of current debt. As it stands, we have $25 million remaining in maturities for 2024 that are currently being worked through, which we expect to be completed in short order. Looking ahead to 2025, there is $320 million of debt maturing, of which $195 million is in active discussion today with our lenders for extensions. For the balance of the loans maturing, we expect to renew the debt by the end of 2025. Further updates will be provided over the next few quarters as we work through this. During the quarter, the trust recognized a net loss of $7.6 million compared to $12.4 million in the same period last year. The improvement in earnings was largely driven by the respective fair value adjustments in each period, partially offset by transaction costs on asset dispositions, interest expense on newly completed multifamily assets, and our deferred income tax recovery position. The most significant fair value adjustment in the third quarter related to a $5.2 million loss within equity-accounted investments on an office property in Ottawa. The loss was driven by discount and cap rate expansion and was supported by a third-party appraisal. As it relates to our recurring income segment, in the third quarter, the trust recognized $1.7 million of same-property NOI from our multifamily rental assets compared to $1.4 million in the prior period. The increase in NOI was driven by a reversal of that debt expense, lower OpEx, and rent growth. In addition, the trust recognized another $300,000 from multifamily assets in the lease that fades in the quarter. Now, NOI for our commercial assets was $2.2 million in the third quarter compared to $2.7 million in the prior period. The change in NOI was a result of asset sales and lease terminations on a specific property, partially offset by the occupancy of the acre tenant at our Claremont property last quarter. For the development segment, in the third quarter, the trust recognized a nominal net loss compared to net income of $3.1 million in Q3-23. Prior year results included a fair value gain on Maple House prior to its transfer to the recurring income segment. Over the third quarter, the residual condo occupancies for Brightwater Phase 1 were completed. In addition, we transferred 98,000 square feet of retail at Brightwater to our recurring income segment, which is roughly 60% leased. Today, between Brightwater 1 and 2 and Ivy Condos, we've achieved over 250 condo occupancies that share, and we've paid over $100 million of construction debt with condo closing proceeds. In September, leasing launched for Birch House at Canary Landing, which comprises 238 rental units. Construction continues for Cherry House at Canary Landing, which adds a further 850 multifamily units to the West Allman Canary Landing community, and we expect it to start leasing in the back half of 2025. And with that, I'll turn the call back over to Michael.