Q4 2021 Killam Apartment REIT Earnings Call

Speaker 1: Good morning, ladies and gentlemen, and welcome to the Killam Apartment Real Estate Investment Trust year end 2021 Financial Results Conference Call. At this time, all lines are in a listen only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require media assistance, please press star zero for the operator. This call is being recorded on Thursday, February 17, 2021.

Good morning, ladies and gentlemen, and welcome to the kilowatt apartment real estate investment Trust your end 2021 financial results conference call.

At this time all lines are in a listen only mode. Following the presentation. We will conduct a question and answer session. So at any time. During this call you require immediate assistance. Please press star zero for the operator. This call is being recorded on Thursday February 17th 2021.

Speaker 1: I would now like to turn the conference over to Mr. Philip Frazier. Please go ahead.

I would now like to turn the conference over to Mr. Philip Fraser. Please go ahead.

Thank you.

Speaker 2: Thank you. Good morning and thank you for joining Killam Apartment Reads Q4 in Year-End 2021 Conference Call. I am here today with Robert Richardson, Executive Vice President, Dale Noseworthy, Chief Financial Officer, and Chief Financial Officer of Killam Apartment Reads Q4.

Good morning, and thank you for joining killing apartment rates Q4, and year end 2021 conference call I'm.

I am here today with Robert Richardson.

Executive Vice President.

Noteworthy Chief Financial Officer.

Here in Cleveland Senior Vice President of Finance.

Speaker 2: Aaron Cleveland, Senior Vice President of Finance and Nancy Alexander, Vice President of Investor Relations and Sustainability. Supplies to accompany today's call are available on the investor relations section of our website under events and presentations. I will now ask Nancy to read out the names of the participants.

Nancy Alexander Vice President of Investor Relations and sustainability.

Slides to accompany today's call are available on.

On the Investor Relations section of our website under events and presentations.

I will now ask Nancy to read our cautionary statement.

Speaker 3: Thank you, Philip. This presentation may contain forward-looking statements with respect to Killam-Acartment REIT and its operations, strategy, 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.

Thank you Phil this presentation may contain forward looking statements with respect to kill an apartment REIT and its operations strategy financial performance conditions or otherwise the actual results and performance of Killen discussed here today could differ materially from those expressed or implied by such statements such statements involve numerous inherent risks.

Speaker 3: 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 are not

And uncertainties and although Killen 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 of forward looking statements.

Speaker 3: levels of activity, performance or achievements will occur as anticipated.

Speaker 3: For further information about the inherent risks and uncertainties in respect of forward-looking statements, please refer to KILN's most recent annual information form and other securities regulatory filings found online on CDAR.

Please refer to kill this most recent annual information form and other securities regulatory filings found online on SEDAR. All forward looking statements made today speak only as of the date, which this presentation refers and kill them does not intend to update or revise any such statements unless otherwise required by applicable sick.

Speaker 3: All forward-looking statements may 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 laws.

<unk> loss thank.

Thank you Nancy.

2021 was a very successful year for killing and its unit holders. We achieved five 1% same property NOI growth and a solid 7% <unk> per.

Speaker 2: 2021 was a very successful year for Kiln and his unit hosts. We achieved 5.1% same property in OI growth and a solid 7% FFO per unit growth.

Per unit growth <unk>.

Speaker 2: Our strategy and commitment to the long-term visibility and viability of our core markets has not changed.

Our strategy and commitment to the long term visibility and viability of our core markets has not changed.

Speaker 2: Increasing earnings from our existing portfolio is a key component of our strategy. As we do this,

Increasing earnings from our existing portfolio is a key component of our strategy.

We do this in a very responsible way.

Considering the current financial demands of our tenants communities and global environment.

Speaker 2: considering the current financial demands of our tenants, communities, and global environment.

Speaker 2: Our portfolio is benefiting from the innovative ways we are growing our revenue and managing our expenses.

Our portfolio is benefiting from the innovative ways, we are growing our revenue and managing our expenses.

We have included our 2021 strategic targets in our year end documents and measured our performance against them as shown on slide three.

Speaker 2: We have included our 2021 strategic targets in our year-end documents and measured our performance against them as shown on slide 3.

We met our geographical diversification target in 2021, and we will continue to look for additional properties, and our Ontario markets as well as Alberta and British Columbia.

Speaker 2: We met our geographical diversification target in 2021, and we will continue to look for additional properties in our Ontario markets as well as Alberta and British Columbia.

In addition, <unk> development pipeline continues to be a key driver of our net asset value creation, producing high quality properties each year we.

Speaker 2: In addition, Killam's development pipeline continues to be a key driver of our net asset value creation, producing high-quality properties each year.

Speaker 2: We are pleased with the considerable progress made during 2021 on our five developments, and I am pleased to report that Latitude, a 208 unit building in Ottawa, opened on January 1st of this year.

We are pleased with the considerable progress made during 2021 on our five developments and I am pleased to report that latitude 208 unit building in Ottawa opened on January one of this year.

Speaker 2: Our 2022 targets are also shown on slide 3.

Our 2022 targets are also shown on slide three.

Speaker 2: Dale will take us through the Killams financial results followed by Robert who will discuss our revenue and expense initiatives for growing our existing asset base.

Dale will take us through <unk> financial results, followed by Robert who will discuss our revenue and expense initiatives for growing our existing asset base.

Speaker 2: I will conclude with a recap on both acquisitions and our development pipeline. I will now..

I will conclude with a recap on both acquisitions and our development pipeline.

I will now hand, it over to Dale.

Thanks Bill.

Speaker 1: Highlights of KILIN's 2021 financial performance can be found on slide four.

Highlights of 2021 financial performance can be found on slide four.

Speaker 1: We achieved solid earnings growth in 2021, including net income of $285 million.

We achieved solid earnings growth in 2021, including net income of $285 million.

Film generated <unk> <unk> per unit of $1 seven.

Speaker 1: Killam generated FFO per unit of $1.07, up 7% from 2020, and AFFO per unit of 90 cents, up 8.4%.

Up 7% from 2020 and <unk> per unit of <unk> 90 up eight 4%. These gains were driven by solid earnings from our same property portfolio and incremental contributions from acquisitions and stabilized development.

Speaker 1: These gains were driven by solid earnings from our same property portfolio and incremental contributions from acquisitions and stabilized development.

Speaker 1: These positive financial results are attributable to the strength and resiliency of our portfolio, our key markets, and our team.

These positive financial results are attributable to the strength and resiliency of our portfolio, our key markets and our team.

2021 continued a strong record of performance slide five recaps key financial metrics over the last five years, we're proud of our consistent <unk> per unit growth, while also greatly increasing the size and quality of the portfolio and maintaining a conservative balance sheet.

Speaker 1: 2021 continued a strong record of performance. Slide five recaps key financial metrics over the last five years. We're proud of our consistent FFO per unit growth while also greatly increasing the size and quality of the portfolio and maintaining a conservative balance.

Speaker 1: Revenue has increased steadily and FFO per unit has grown by a compound annual growth rate of 4.4%.

Revenue has increased steadily and <unk> per unit has grown by a compound annual growth rate of four 4%.

Speaker 1: Killam's current AFFL payout ratio of 76% has improved from 86% five years ago, while distributions have increased five times during the same period.

<unk> current <unk> payout ratio of 76% has improved from 86% five years ago, while distributions have increased five times during the same.

Speaker 1: As we continue to execute on our growth strategy, our investment property portfolio has grown by an impressive compound annual growth rate of 18.3% to $4.5 billion today.

As we continue to execute on our growth strategy, our investment property portfolio has grown by an impressive compound annual growth rate of 18, 3% to $4 $5 billion today.

Speaker 1: Slide six shows our Q4 and annual FFO and AFFO per unit result.

Slide six shows our Q4 and annual <unk> and <unk> per unit results five 8% same property NOI growth was a significant driver to the 8% and 5% growth in <unk> and <unk> per unit for the fourth quarter.

Speaker 1: 5.8% same property NOI growth was a significant driver to the 8% and 5% growth in FFO and AFFO per unit for the fourth quarter.

Speaker 1: Contributions from acquisitions and completed developments and lower interest rates on mortgage refinancings over the last year also contributed positively to Kilm's Q4 results.

Contributions from acquisitions and completed developments and lower interest rates on mortgage refinancings over the last year also contributed positively to kill them Q4 results.

Slide seven shows the strength of our existing portfolio with same property revenues up four 8% in Q4.

Speaker 1: Slide 7 shows the strength of our existing portfolio with same property revenues up 4.8% in Q4.

This includes a 160 basis point improvement in apartment occupancy in the quarter to 98, 1%.

Speaker 1: This includes a 160 basis point improvement in apartment occupancy in the quarter to 98.1%.

Speaker 1: We maintain this occupancy throughout Q4 achieving 98.1% occupancy in December , our highest December occupancy on record.

We maintained this occupancy throughout Q4, achieving 98, 1% occupancy in December our highest December occupancy on record.

Our MHC and commercial properties also performed well in Q4 with MHC revenues up three 6% and commercial revenues up 10, 9% same property operating expenses were up three 3% in the quarter due primarily to inflationary cost pressures increased contract services.

Speaker 1: Our MHC and commercial properties also performed well in Q4, with MHC revenues up 3.6% and commercial revenues up 10.9%.

Speaker 1: Same property operating expenses were up 3.3% in the quarter due primarily to inflationary cost pressures, increased contract services, repairs and maintenance costs, and commodity pricing of natural gas and oil, as well as an increase in staffing costs. For the year, same property revenues were up 4%. Slide 10.

<unk> and maintenance costs and commodity pricing of natural gas and oil as well as an increase in staffing costs.

For the year same property revenues were up 4% slide eight highlights the leavers driving this revenue growth.

Speaker 1: In addition to occupancy gains, we achieved 3% growth in year-over-year rental.

In addition to occupancy gains, we achieved 3% growth in year over year rental rates were seeing increasing market rents across the majority of our markets and we are successfully capturing these spreads on turnover.

Speaker 1: We're seeing increasing market rents across the majority of our markets and we're successfully capturing these spreads on turnover.

Speaker 1: We experienced a decrease in turnover in 2021. However, the turnover remained healthy at 26%.

We experienced a decrease in turnover in 2021, however, the turnover remained healthy at 26%.

Speaker 1: We experienced an uptick in rental incentives in the year. These incentives offerings are primarily focused in Alberta. Excluding Alberta, incentives represent only 0.25% of residential rent in 2021.

We experienced an uptick in rental incentives in the year. These incentives offerings are primarily focused in Alberta, excluding Alberta incentives represent only 0.25% of residential rent in 2021.

Overall NOI was up five 1% for the year and we achieved a 70 basis point improvement in same property operating margin.

Speaker 1: Overall NOI was up 5.1% for the year and we achieved a 70 basis point improvement in same property operating margin.

Speaker 1: The top chart on slide 10 shows NOI growth by quarter with an impressive average of 4.1% over the past 16 quarters despite the headwinds of the pandemic in the last...

The top chart on slide 10 shows NOI growth by quarter with an impressive average of four 1% over the past 16 quarters. Despite the headwinds of the pandemic in the last seven quarters.

Speaker 1: The breakdown of apartments, same property NOI by region can be found on the bottom of the slide.

The breakdown of apartment same property NOI by region can be found on the bottom of slide 10.

Speaker 1: It highlights the strength in Atlantic Canada and Ontario.

Highlights the strength in Atlantic, Canada, and Ontario.

Speaker 1: Robust NOI growth, along with a 26 basis point reduction in kiln's weighted average cap rate to 4.41% as at December 31, 2021, resulted in kiln recording $240 million of investment property fair value gains in the year 2021.

Robust NOI growth along with a 26 basis point reduction in kilns weighted average cap rate to 4.41% as at December 31, 2021 resulted in killing recording $240 million of investment property fair value gains in the year.

Speaker 1: Strong market fundamentals persist throughout the country with population growth outpacing new housing supply.

Strong market fundamentals persist throughout the country with population growth outpacing new housing supply.

Speaker 1: Last week, Statistics Canada released 2021 census numbers, reporting 5.2% population growth in Canada over the last five years.

Last week's statistics, Canada release, 2021 census numbers reporting five 2% population growth in Canada over the last five years.

Speaker 1: Prince Edward Island registered an 8% increase, the highest of all 10 Canadian provinces.

Prince Edward Island registered an 8% increase the highest of all 10 Canadian provinces.

Speaker 1: Population growth in British Columbia and Ontario were both also above the national average and highlight our growth focus in these regions.

Population growth in British Columbia, and Ontario, where both also above the national average and highlight our growth focus in these regions.

Speaker 1: Nova Scotia grew by 5% and New Brunswick by 3.8%.

Nova Scotia grew by 5% and new Brunswick by three 8% popular.

Speaker 1: Population in urban centers was reported with the census, with Halifax leading the country, with 26.1% growth in its downtown core over the past five years.

Population in urban centers was reported with offensive with Halifax, leading the country with 26, 1% growth in its downtown core over the past five years.

Annual population data released by Statistics, Canada shows that population growth in the Maritimes has accelerated over the last few years slide 11 shows a substantial population growth in Halifax, and our three markets in New Brunswick.

Speaker 1: Annual population data released by Statistics Canada shows that population growth in the Maritimes has accelerated over the last few years.

Speaker 1: Slide 11 shows the substantial population growth in Halifax and our three markets in New Brunswick.

Speaker 1: fueled by strong economic activity, positive trends in immigration, and a marked increase in that interprovincial migration.

By strong economic activity positive trends in immigration and marked increase in that intra provincial migration.

Speaker 1: population growth we're seeing in Atlantic Canada driving strong demand across the portfolio.

The population growth, we're seeing in Atlantic, Canada is driving strong demand across the portfolio.

Slide 12 highlights our debt maturity profile, including average apartment mortgage rates by year versus prevailing see MHC insured mortgage rate.

Speaker 1: Slide 12 highlights our debt maturity profile, including average apartment mortgage rates by year versus prevailing CMHC insured mortgage rates.

Speaker 1: During 2021, Kilm refinanced 132 million of maturing mortgages with 184 million of new debt at a weighted average interest rate of 2.13%. 24 basis points lower than the weighted average interest rate of the maturing debt. Lower interest expense on Kilm's same property portfolio contributed to FFO per unit growth in 2021. than the weighted average interest rate of therun do not

During 2021, Killen refinanced $132 million of maturing mortgages with a $184 million of new debt at a weighted average interest rate of 2.13% 24 basis points lower than the weighted average interest rate of the maturing debt.

Lower interest expense until the same property portfolio contributed to <unk> per unit growth in 2021.

Speaker 1: Interest rates are forecasted to rise in 2020.

Interest rates are forecasted to rise in 2022, however, kilns mortgages are diversified by to avoid dependence on any specific lending institution and maturity dates are staggered to mitigate interest rate risk kill them is also focused on reducing its debt levels with a longer term target of debt to total assets of less.

Speaker 1: However, Kiln's mortgages are diversified to avoid dependence on any specific lending institution and maturity dates are staggered to mitigate interest rate risk. Kiln is also focused on reducing its debt levels with a longer-term target of debt to total assets of less than 40% by the end of 2025.

And 40% by the end of 2025.

Slide 13 includes key balance sheet metrics, we are maintaining a conservative balance sheet and ended the year with that as a percentage of total assets of 45%.

Speaker 1: Slide 13 includes key balance sheet metrics. We are maintaining conservative balance sheet and end of the year with debt as a percentage of total assets of $45.

Speaker 1: Following a $98 million equity offering that closed on February 4th, we've reduced our debt levels to approximately 43.5% and have access to over $200 million in capital through our credit facilities and cost cash on hand, which will support over $400 million in future acquisitions and developments. We are well positioned to Cookie Institute's

Following a $98 million equity offering that closed on February 4th we have reduced our debt levels to approximately 43, 5% and have access to over $200 million in capital through our credit facilities and cost cash on hand, which will support over $400 million in future acquisitions and development, we are well positioned.

To execute on our growth plans.

Speaker 1: I will now turn the call over to Robert who will provide color on key revenue and operating initiatives as well as the value delivery to our residents.

I will now turn the call over to Robert who will provide color on key revenue and operating initiatives as well as the value delivery to our residents.

Thank you Dale and good morning, everyone before discussing kill them strategy and current operating initiatives I would like to start by acknowledging killed 750 employees with a special note to our frontline staff to continue their daily to interact directly with our residents and commercial tenants.

Speaker 2: Thank you, Dale, and good morning, everyone. Before discussing Killam's strategy and current operating initiatives, I would like to start by acknowledging Killam's 750 employees with a special nod to our frontline staff that continue daily to interact directly with our residents and commercial gent Humans...

The killing team's ability to deliver exceptional service as it navigates the ever changing demands imposed by the pandemic is extremely impressive. Thank you very much for your dedication and excellent work.

Speaker 2: To kill on team's ability to deliver exceptional service as it navigates the ever-changing demands imposed by the pandemic is extremely impressive. Thank you very much for your dedication.

I will begin today's operating discussions by highlighting kill them three principal strategies that guide us as we grow our business.

Speaker 2: I will begin today's operating discussions by highlighting Kilm's three principal strategies that guide us as we grow our business.

Speaker 2: The number one priority is to increase earnings from our existing portfolio of property.

One priority is to increase earnings from our existing portfolio of properties.

Speaker 2: Priority two is to expand and diversify the portfolio geographically through accretive acquisitions that target newer properties.

Priority two is to expand and diversify the portfolio geographically through accretive acquisitions that target newer properties.

Speaker 2: And number three is to construct new low carbon foot and properties while expanding our development pipeline in Kildens Core discoloration),

And number three is to construct new low carbon foot print properties, while expanding our development pipeline and kill them as core markets.

Speaker 2: I will discuss Kiln's continuous focus on growing same property revenues and managing our properties expense.

I will discuss <unk> continuous focus on growing same property revenues and managing our properties expenses.

Speaker 2: Phillip will conclude the formal part of this call with a spotlight on new acquisitions and development.

I'll conclude the formal part of this call with a spotlight on new acquisitions and developments.

It jumps existing portfolio totals approximately 19000 apartment units 5900, MHC sites and 1 million square feet of commercial premises. Our team is focused on optimizing revenues and managing managing expenses to deliver affordable quality housing that our residents are proud to call home.

Speaker 2: Kim's existing portfolio totals approximately 19,000 apartment units, 5,900 MHC sites, and 1,000,000 square feet of commercial premises.

Speaker 2: Our team is focused on optimizing revenues and managing expenses to deliver affordable, quality housing that our residents are proud to call home.

Speaker 2: Slide 15 details the number of levers Kiln uses to increase net operating income. I will speak to these in the next few slides.

<unk> hundred 15 details the number of leavers kill me users to increase net operating income.

I will speak to these in the next few slides.

Slide 16 shows in terms of revenue growth for the year by property segment as Dale mentioned earlier, all three business segments in our portfolio showed strength and resiliency in 2021, delivering 4% consolidated revenue growth.

Speaker 2: Slide 16 shows KILM's revenue growth for the year by property segment. As Dale mentioned earlier, all three business segments in our portfolio showed strength and resiliency in 2021, delivering 4% in consolidated revenue growth.

Speaker 2: Kim's market fundamentals for all apartments throughout Canada remain solid with consistently high occupancy rates coast to coast.

Kim's market fundamentals for all apartments throughout Canada remains solid with consistently high occupancy rates coast to coast in 2021 occupancy increased 50 basis points contributing to same property a permanent revenue growth of three 6% leading to date in 2022 has continued to be strong.

Speaker 2: In 2021, kilns occupancy increased 50 basis points, contributing to same property apartment revenue growth of 3.6%. Leasing to date in 2022 has continued to be strong. Today, 49% of kilns 221 apartment properties are 100% occupied, with another 22% having only one suite vacant.

Today, 49% of kilns 221 apartment properties are 100% occupied with another 22%, having only one suite vacant.

Combined 71% of films apartment properties have one unit.

Speaker 2: Combined, 71% of Kiln's apartment properties have one unit or less vacant.

Less vacant.

Speaker 2: Kilm's resort properties in the manufactured home community segment rebounded impressively in 2021 versus the pandemic-impacted summer of 2020. The easing of COVID-19 restrictions combined with increased inter-provincial travel resulted in a 15.7% increase in same-property revenue year-over-year. Our commercial portfolio includes three...

<unk> resort properties in the manufactured home community segment rebounded impressively in 2021 versus the pandemic impacted summer of 2020.

The easing of COVID-19 restrictions combined with increased enter provincial travel resulted in a 15, 7% increase in same property revenue year over year.

Our commercial portfolio includes three large properties.

Plus other smaller properties located primarily in Halifax amongst them.

Speaker 2: plus other smaller properties located primarily in Halifax and Moncton.

Speaker 2: The Rui Market is a 146,000 square foot retail and office property in downtown Halifax.

The <unk> market is a 146000 square foot retail and office property in downtown Halifax westbound place is a 300000 square foot retail and office complex located in Waterloo, and our largest commercial property royalty crossing.

Speaker 2: Westmount Place is a 300,000 sq. ft. retail and office complex located in Waterloo and our largest commercial property, Royalty Crossing

Speaker 2: Here's a 383,000 square foot enclosed mall in Charlottetown.

Here's a 383000 square foot enclosed mall in Charlottetown.

Speaker 2: Kiln now owns 75% of Royalty Crossing and assumed property management and leasing duties in 2021. Most recently, Royalty Crossing executed a long-term lease with Sephora, a Tier 1 retailer known to generate significant retail traffic and a tenant that attracts other quality tenants. We expect to build on this success.

<unk> now owns 75% of royalty crossing and assumed property management and leasing duties in 2021, most recently royalty crossing executed a long term lease with sephora.

Tier one retailer known to generate significant retail traffic and the tenants that attracts other quality tenants, we expect to build on this success.

Speaker 2: Overall, Killen leased a net new 75,000 square feet of commercial space throughout the portfolio and renewed over 135,000 square feet of commercial space during 2021, achieving a weighted average net rental rate increase of 8.7%.

Overall, killing lease a net new 75000 square feet of commercial space throughout the portfolio and renewed over 135000 square feet of commercial space. During 2021, achieving a weighted average net rental rate increase of eight 7%.

Speaker 2: Kilm's commercial segment generated just over 5% of Kilm's total net operating income in 2021, achieving 7.4% revenue growth through improved occupancy, higher rental rates, and fewer pandemic-related concessions.

Commercial segment generated just over 5% of <unk> total net operating income in 2021.

Cheating seven 4% revenue growth through improved occupancy higher rental rates and fewer pandemic related concessions. Please refer to slide 17, our very successful repositioning program is one of killing the revenue optimizing leavers.

Speaker 2: Please refer to slide 17. Our very successful repositioning program is one of Kilm's revenue optimizing levers in the apartment segment. Over time, we have fine-tuned the process of repositioning suites to minimize downtime while providing our residents with the best finishes based on appeal, functionality and durability.

The apartment segment overtime, we have fine tuned the process of repositioning suites to minimize downtime, while providing our residents with the best finishes based on appeal functionality and durability.

Speaker 2: I want to emphasize that Kiln is meeting market demand for modern energy efficient suites and there is a sizeable portion of the rental marketplace willing and able to pay higher rents for upgraded suites.

I want to emphasize that <unk> is meeting market demand for modern energy efficient suites, and there was a sizable portion of the rental marketplace willing and able to pay higher rents for upgraded suites.

Speaker 2: Based on this market demand for repositioned suites, KILM repositioned 551 suites in 2021, nominally more than the $550 budget. We invested an average of $28,000 per suite to reposition the units and generated a 13% unlevered return on investment.

Based on this market demand for our reposition suites kill repositioned 551 suites in 2021 nominally more than.

550, budgeted we invested an average of $28000 per suite to repositioning of units and generated a 13% unlevered return on investment.

Speaker 2: Kiln's 2022 repositioning program is targeting 600 suites for renovation.

Film's 2022 repositioning program is targeting 600 suites for renovation.

Speaker 2: I will emphasize that KILM only undertakes repositionings as suites become vacant and we are not proponents of evicting tenants to facilitate suite repositioning.

<unk> I can only undertakes repositioning as suites become vacant and we're not proponents of evicting tenants to facilitate suite repositioning.

John Sweet turnover percentage was 26% in 2021, thus there is no requirement to forced turnover for the repositioning program.

Speaker 2: Kiln suite turnover percentage was 26% in 2021. Thus, there is no requirement to force turnover for the repositioning program.

Speaker 2: Overall, kiln currently has 5,500 additional suites that can be repositioned and this opportunity continues to cycle forward as the properties age.

Overall kill them currently has 5500 additional suites that can be repositioned and this opportunity continues to cycle forward at the properties age.

Improving the revenue line is important but expense management is also critical to increasing net operating income further achieving expense savings through efficiency upgrades reduces consumption, resulting in savings on electricity water and heating costs, while helping to mitigate impact on climate change as well it ensures our bill.

Speaker 2: Improving the revenue line is important, but expense management is also critical to increasing net operating income. Further, achieving expense savings through efficiency upgrades reduces consumption, resulting in savings on electricity, water, and heating costs, while helping to mitigate Kiln's impact on climate change. As well, it ensures our buildings are more sustainable and resilient to these changes.

Things are more sustainable and resilient to these changes.

Speaker 2: Flight 18 highlights Kiln's many environmentally sensitive capital investments. We maintain a constant focus on lowering Kiln's utility and heating costs, decreasing consumption and minimizing Kiln's carbon footprint.

Slide 18 highlights comes in many environmentally sensitive capital investments, we maintain a constant focus on lowering tons of utility and heating costs decreasing consumption and minimizing kim's carbon footprint in 2021, we invested $8 $1 million in these projects and our budgets and another $8 million for 2020 twos kill them.

Speaker 2: In 2021, we invested $8.1 million in these projects and a budget of another $8 million for 2022.

Speaker 2: Kiln's emissions reduction plan is wide-ranging, such as traditional energy efficiency projects like installing LED lighting and low-flow water devices, upgrading boilers and heat pumps, and

Emissions reduction plan is wide ranging such as traditional energy efficiency projects like installing led lighting and low flow water devices.

Upgrading borders and heat pumps and improving installation.

Speaker 2: With the advancement in technology, our green investments now include smart metering, updated building operating technologies, and installation of renewable energy sources such as roof-mounted PV panels and credit card-activated EV chargers.

With the advancement in technology Green investments now include Smart metering.

Outdated building operating technologies and installation of renewable energy sources, such as roof mounted PV panels, and credit card activated EV Chargers and and kills new developments, we are keen to install geothermal heating and cooling systems whenever possible. For example, we installed a geothermal systems and three developments in 'twenty one.

Speaker 2: And in Kiln's new developments, we are keen to install geothermal heating and cooling systems whenever possible. For example, we installed a geothermal system in three developments in 21. Once completed, Kiln will have six buildings and approximately 1,000 units using geothermal heating and cooling sources.

John .

Once completed we will have six buildings and approximately 1000 units using geothermal heating and cooling sources.

Speaker 2: Kilmeade is committed to longer term environmental goals that reduce greenhouse gases and increase renewable energy sources. To help achieve this, we piloted several building certification programs this year, considering the costs and benefits of each.

Kim has committed to longer term environmental goals that reduce greenhouse gases and increased renewable energy sources to help achieve this we piloted several building certification programs. This year, considering the costs and benefits of each of these certifications include pharma best fit well in the certified rental building program.

Speaker 2: These certifications include Boma Best, Fitwell, and the Certified Rental Building Program, and should help ensure our portfolio has the best operating and healthy living standards for our residents.

That should help ensure our portfolio has the best operating at healthy living standards for our residents. We will build on this research and roll up more certified properties in the coming years beforehand, you back to Philip I want to discuss films emphasis on providing affordable safe clean housing for our residents.

Speaker 2: We will build on this research and roll out more certified properties in the coming years.

Speaker 2: Before handing you back to Philip, I want to discuss Jim's emphasis on providing affordable, safe, clean housing for all our residents.

Please refer to slide 19.

Speaker 2: Kilm offers a range of housing options in each of its markets, from long-established properties to newly constructed luxury buildings, having the latest finishes and amenities.

Kill them offers a range of housing options and each of its markets from long established properties to newly constructed luxury buildings, having the latest finishes and amenities.

Telus portfolio offers a large selection of locations unit sizes, and layouts and each of its urban and suburban communities with an average rent of $1 44 per square foot across our portfolio. This represents suggests $240 a month in rent a remarkable value, we consider that heat water insurance maintenance and <unk>.

Speaker 2: With an average rent of $1.44 per square foot across the portfolio, this represents just $1,240 a month in rent, a remarkable value when considered that heat, water, insurance, maintenance and realty taxes are included in the rent.

Taxes are included in the rent.

Speaker 2: Canada Mortgage and Housing Corporation's measure of housing affordability is the shelter cost to income ratio, which sets the affordability threshold at 30% of the forward tax median household income.

Canada mortgage and housing Corporation. Some measure of housing affordability is a shelter costa ratio to income ratio, which sets the affordability threshold at 30%.

For tax median household income.

Speaker 2: When we compare Kiln's rents to the 30% shelter cost to income metrics in each of Kiln's core markets, it underscores the fact Kiln's average rents are well within CMHC's threshold, ranging from a low of 15% to a high of 25% of median household income in our market.

When we compare it comes rents to the 30% shelter cost to income metric in Egypt, <unk> core markets.

Your scores. The fact kilns average rents are well within CMA sea threshold, ranging from a low of 15% to a high of 25% of median household income in our markets.

Speaker 2: Kiln recognizes it as a civic duty to be a contributor to the affordable housing solution.

Kill them recognizes it as a civic duty to be a contributor to the affordable housing solutions.

Speaker 2: Not only does Kiln provide very affordable living options generally, but Kiln is an active partner with many non-profit housing and government agencies such as the YWCA, Urban Housing Initiatives and Centers for Addiction and Mental Health to deliver more than 850 subsidized units in our community.

Not only does kill and provide very affordable living options generally, but kill them as an active partner with many nonprofit housing and government agencies, such as the Ywca urban housing initiatives and centers for addiction, and mental health to deliver more than 850 subsidized units in our communities.

Speaker 2: Along with affordability, we want to ensure our residents are satisfied calling a Killam property home. In late December , we received the results of Killam's annual tenant survey, conducted by our third-party provider, Narrative Research.

Along with affordability, we want to ensure our residents are satisfied calling.

Killen property home in late December we received the results of kilns annual tenant survey conducted by our third party provider narrative research narrative tells US till 2021 survey had an impressive response rates response rate of 31% over 4000 surveys completed.

Speaker 2: Narrative tells us Killam's 2021 survey had an impressive response rate of 31%, over 4,000 surveys completed.

Speaker 2: and the overall tenant satisfaction rating was 87%, which we are advised is markedly better than the industry benchmark for multi-residential owners. As well, I would highlight that Kiln's overall satisfaction score has ranged from 87% to 90% for the last nine years.

And the overall tenant satisfaction rating was 87%, which we are advised is markedly better than the industry benchmark for multi residential owners as well I would highlight accounts overall satisfaction scores range from 87% to 90% for the last nine years.

Speaker 2: In terms of satisfaction with their apartment units, Kilmer received a 90% satisfaction rating, another very positive outcome.

In terms of satisfaction with their apartment units film received a 90% satisfaction rating another very positive outcome a resident since tell us they enjoy living an account property, 83% consider their apartment to represent good value the significant.

Speaker 2: Our residents tell us they enjoy living in a Killam property, 83% consider their apartment to represent good value. The significant increases in purchase prices and upkeep costs for single-family homes these last two years reinforces the value proposition renting from Killam offers.

Increases in purchase prices and upkeep costs for single family homes. These last two years reinforces the value proposition renting from killing offers I will now hand, you back to Philip to provide an update on our development and acquisitions.

Speaker 2: I will now hand you back to Philip to provide an update on our developments and acquisitions.

Thank you Robert.

Speaker 4: We acquired $400 million in assets in 2021, making it Killam's largest year of acquisition.

We acquired $400 million in assets in 2021, making a killing largest year of acquisitions, while also increasing our geographical diversification by producing 33% of our NOI from outside of Atlantic Canada.

Speaker 4: while also increasing our geographical diversification by producing 33% of our NOI from outside the But it's not well enough to? burn rock under the Y provide for cold relief. By two months later faced with a At the Y ticks hot in Canada. By 21 Statistics Ou mentioned available to

Slide 21 is a snapshot of our acquisitions.

Speaker 4: One of the most exciting acquisitions last year was the purchase of the 785 suite portfolio in Kitchener-Waterloo, expanding our operating platform in this growing urban area of Ontario.

One of the most exciting acquisitions last year was the purchase of the 785 suite portfolio in Kitchener Waterloo.

<unk>, our operating platform in this growing urban area of Ontario.

Speaker 4: Atlantic Canada remains an important market for Killam, and in 2021, it represented 16% of Killam's acquisitions, adding 200 apartment suites in the region.

Atlantic Canada remains an important market for killer.

In 2021, it represented 16% of <unk> acquisitions, adding 200 apartment suites in the region and.

In addition, we increased our ownership in royalty crossing formerly the Cheryl Towne mall by 25% to 75% for $10 million and purchased 14 acres of adjacent land for multi residential development.

Speaker 4: In addition, we increased our ownership in Royalty Crossing, formerly the Charlottetown Mall, by 25% to 75% for $10 million and purchased 14 acres of adjacent land for multi-residential development.

Speaker 4: Overall, 6% of acquisition dollars were allocated to future residential development.

Overall, 6% of acquisition dollars were allocated to future residential development.

The fourth quarter of 2021 was busy acquiring five new properties totaling 516 units located in Charlotte town to a mountain and two inhibitor for approximately $125 million.

Speaker 4: The fourth quarter of 2021 was busy acquiring five new properties totaling 516 units located in Charlottetown, two in Moncton and two in Edmonton for approximately $125 million.

The details on these acquisitions are shown on slides 22 through 25.

Speaker 4: The details on these acquisitions are shown on slides 22 through 25.

We started the year with Redevelopments Shorefront, Nolan Hill, and 10, Harley and initial lease up and slide 26 shows the successful lease up of these new developments.

Speaker 4: We start the year with three developments, Shorefront, Nolan Hill and Tin Harley, and Initial Lease-Up. And slide 26 shows the successful lease-up of these new developments.

The 349 units were fully leased by mid 2021, and contributed $1 7 million to <unk> growth during the year.

Speaker 4: 349 units were fully leased by mid 2021 and contributed $1.7 million to FFO growth during the year.

Slide 27 shows a rendering of the five projects that were underway at year end as well Northern Hill Phase II development in Calgary, and which we have a 10% interest started construction in December of 2021.

Speaker 4: Fly 27 shows a rendering of the five projects that were underway at year end. As well, Nolan Hill phase two, a development in Calgary, in which we have a 10% interest, started construction in December of 2021.

Speaker 4: This 234 unit complex is expected to be completed in 2023.

This 234 unit complex is expected to be completed in 2023 kill.

Speaker 4: Killam has a $65 million commitment in place to purchase the remaining 90% interest of this second phase following completion of construction and achievement of certain conditions.

<unk> has a $65 million commitment in place to purchase the remaining 90% interest of this second phase following completion of construction and achievement of certain conditions.

Speaker 4: These five projects, along with Phase 2 of Nolan Hill, will add 731 units and approximately $300 million of high-quality new construction to our portfolio. The Key Mississauga is shown on slide 29.

These five projects along with phase II of Nolan Hill will add 731 units and approximately $300 million of high quality, new construction to our portfolio.

The key in Mississauga as shown on slide 29.

We expect to have the building ready for occupancy by April .

We had been delayed approximately six months due to COVID-19 and municipal inspection delays.

Speaker 4: We have been delayed approximately six months due to COVID and municipal inspection delay.

Leasing to date for this property has been very strong with 29% of the units pre lease we expect to have Luna as shown on slide 30 opened by the end of June of this year.

Speaker 4: Leasing to date for this property has been very strong, with 29% of the units pre-leased.

Speaker 4: We expect to have LUMA, as shown on slide 30, open by the end of June of this year.

Speaker 4: This 168-unit building also contains 9,600 square feet of ground floor retail.

This 168 units building because also contains 9600 square feet of ground floor retail.

Speaker 4: The Governor in Halifax, shown on slide 31, is located adjacent to the Alexander and the Brewery Market in downtown Halifax.

The governor in Halifax shown on Slide 31 is located adjacent to Alexander and the brewery market and downtown Halifax.

The building is progressing nicely and we expect to have that the luxury 12 unit property finished by the third quarter of this year.

Speaker 4: The building is progressing nicely and we expect to have the luxury 12-unit property finished by the third quarter of this year. A progress shot is shown on slide.

Our progress shot as shown on slide 32.

Slides 33, and 34 show or 169 unit development known as <unk> 66 and kitchen.

Speaker 4: Slides 33 and 34 show our 169 unit development known as Civic 66 in Kitchener.

It was topped off in January and is proceeding on budget and on schedule with completion estimated for early 2023.

Speaker 4: It was topped off in January and is proceeding on budget and on schedule with completion estimated for early 2023.

The budget of this development is 69 close to $70 million construction financing was placed during Q2 2021 and all of the remaining development costs will be funded through this financing.

Speaker 4: The budget of this development is 69, close to $70 million. Construction financing was placed during Q2 2021, and all the remaining development costs will be funded through this finance.

Speaker 4: Slide 37 breaks down Killam's future development opportunities, totaling approximately 3,800 units that are in various stages of development or pre-development.

Slide 37 breaks down kilometer future development opportunities totaling approximately 3800 units that are in various stages of development of pre development.

This pipeline gives us great value creation for kill them in the coming years.

Speaker 4: This pipeline gives us great value creation for Kill'em in the coming year.

To conclude we are proud of the performance in 2021.

Speaker 4: To conclude, we are proud of the performance in 2021. It was the fifth year that we increased our distribution to unit holders. And on February 1st, we were able to increase our distribution to unit holders.

It was it was the fifth year that we increased our distribution to unit holders and on February one.

Speaker 4: This year, we are added to the S&P TSX Canadian Dividend Aristocrat Index. The inclusion of this index reflects the strength of our multi-residential real estate portfolio and our ability to provide an attractive distribution yield.

This year, we were added to the S&P PSX Canadian dividend aristocrat index.

The inclusion of this index reflects the strength of our multi residential real estate portfolio and our ability to provide an attractive distribution yield.

Speaker 4: I would like to thank our employees for their hard work and dedication during this year. We are optimistic of the year ahead, and we will continue to execute on our priorities and create value for all of our unit holders during 2022. Thank you, and I will now open up the call for questions.

I would like to thank our employees for their hard work and dedication. During this year. We are optimistic of the euro hit and we will continue to execute on our priorities and create value for all of our unit holders during 2022. Thank.

Thank you and I'll now open up the call for questions.

Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press star followed by one on your Touchtone phone.

Speaker 5: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by one on your touch-tone phone. You will hear a three-tone prompt acknowledging your request, and your questions will be polled in the order they are received. Should you wish to decline from the polling process, please press star followed by two. And if you're using a speakerphone, please lift your handset before pressing any keys. One moment for your first question.

Here are three ton prompt acknowledging your request and your questions will be pulled in the order. They are received should you wish to decline from the polling process. Please press star followed by you.

Using a speakerphone please lift your handset before pressing any.

One moment for your first question.

Speaker 5: Your first question comes from Mark Rothschild with Canaccord. Please go ahead. Thanks and good morning everyone.

Your first question comes from Mark Rothschild with Canaccord. Please go ahead.

Thanks, and good morning, everyone.

Good morning America work Okay.

Clearly the occupancy growth has been.

Speaker 6: nice to see and not too surprising.

Nice to see and not too surprising obviously it doesn't make it doesn't get so high so easily.

Speaker 6: doesn't get so high so easily. Can you talk a little bit about what your thoughts are as far as pushing rents even further and having that level of occupancy when you're looking at the

Can you talk a little bit about what your thoughts are as far as pushing rents even further and.

Having that level of occupancy.

When the market is strong.

One of the things I would highlight markets, 25% of our portfolio.

Speaker 2: One of the things I would highlight, Mark, is 25% of our portfolio has the ability to turn, right? So that's what we're seeing these days. So it was 26 in 2021. So we see good opportunity there as those units come vacant. Even the ones that we're not renovating, we see fairly good lift there. So we think that that'll help us meet our goal for 2022. I beg what?

Has the ability to turn right. So that's what we're seeing in these states was 26 and 2021, so we see good opportunity there as those units come vacant.

Even the ones that were not renovating we see.

Fairly good lift there. So we think that that will help us.

Mitra it meet our goal for 2022 in a big way.

Okay, and then maybe on that point with the guidance that you gave or the target rather that you set for our same property NOI growth of 2% to 3% for the year.

Speaker 6: And maybe on that point, with the guidance they give, or the target rather, that you set for a same property and a Y growth of 2 to 3 percent for the year, is there an assumption of further increase in turnover, or would you expect turnover to decrease in there?

Is there an assumption of further increase in turnover or would you expect turnover to decrease in there.

Speaker 6: with revenue growth the way it is, do you see that as something that could be exceeded or is maybe the expense side going to often.

With revenue growth the way. It is do you see that as something that could be exceeded or is maybe the expense side going to offset.

Yes, Hi, Mark.

Speaker 1: Hi Mark, I think we are expecting a continued decrease in turnover as the trend we've seen in the last few years. I don't think significantly, but certainly as you will have seen from our numbers, it's a tight rental market just about everywhere in the country. But that being said, I think that

We are expecting continued decrease in turnover as the trend we've seen in the last few years I don't think significantly but certainly.

As you will have seen from our numbers that the tight rental market.

About everywhere in the country so that.

That being said I.

I think that.

The expense line is the one when you look at what our NOI guidance is going to be we are expecting to feel the effects of the inflationary environment, the cold winter and higher commodity prices and higher property taxes than we've seen in the last few years. So I think that when we look when you see that 2% to 3% NOI targa.

Speaker 1: The expense line is the one when you look at what our NOI guidance is going to be. We are expecting to feel the effects of the inflationary environment, the cold winter and higher commodity prices and higher property taxes than we've seen in the last few years. So I think that when we look, when you see that 2-3% NOI target, that is reflecting an expectation that we could see expenses, you know.

But that is reflecting an expectation that we could see expenses.

Speaker 1: potentially over 6% in 2022. Just a reminder, Q1 is always a really important one for us when we look at the expenses. Once we see where the winter heating costs fall out, we'll be able to provide a little bit, probably narrow that down a little bit more.

Essentially over 6% in 2022, just reminder, Q1 is always a really important one for us when we look at the expenses.

Once we see where the the winter heating costs fall out, but we will have that will be able to provide a little bit probably narrow that down a little bit more.

Speaker 4: And Mark, my comments on your question, again, I think it's very understandable when you see the announcements from the federal government in terms of the increased numbers in immigration and knowing how hard it is to create new supply that the turnover numbers for all of us across the country are on a downward trend until the supply side of our industry is solved.

And Mark My comments on your question again, I think its very understandable when you see the announcements from the federal government in terms of the increase numbers and immigration and.

And knowing how hard it is to create new supply.

The turnover numbers for all of us across the country, who are on a downward trend until this.

Until the supply.

Side of our industry is solved.

Very helpful. Thank you.

Your next question comes from Jonathan <unk> with TD Securities. Please go ahead.

Speaker 5: Your next question comes from Jonathan Kletcher with TD Securities. Please go ahead.

Thanks.

<unk>.

Speaker 7: First question, just on the mark to market that you guys reference, 10 to 15%, can you maybe break that down a little? Is it different in markets where there's rent control versus markets where there's no rent control?

John first question just just on the.

The mark to market that you guys referenced tend to 10% to 15% can you maybe.

Take that down a little I guess it.

Different between in markets, where there is rent control versus markets, where theres no rent control.

Speaker 1: I'd say yes, it's different across. I'd say the strongest that we're seeing is probably in Toronto, Kitchener, Waterloo area when we see those market spreads. Halifax is looking very healthy. I'd say those two are probably the biggest standouts. New Brunswick still some good upside but not to the same extent that we would see in those other markets. BC as well looks very good in terms of that. So I'd say that.

Hey, yes, it's different across let's say the strongest that we're seeing it already in Toronto Kitchener Waterloo area, when we see those mark to market spread.

Halifax is looking very healthy.

I would say those two are probably the biggest stand that standout.

New Brunswick still some good upside, but not to the same extent that we would see in those other markets.

BC as well it looks very good in terms of that so I'd say that.

I do think rent control plays a factor there.

Speaker 8: So those markets would be kind of above the 15% and the markets where there's no rent control would be closer to the 10% or less. And then in New Brunswick, you did talk about a big gain or a big increase in property taxes. What sort of uplifts do you think you can push through on renewals in New Brunswick?

But so does population and everything so those markets would be kind of above the 15% in the markets, where there's no regulatory or closer to the 10% or less and then Brian just like you did you.

You did talk about.

The big gain or a big increase in property taxes.

What sort of uplift do you think you can push through.

On renewals and new Brunswick.

So we've been pretty consistent when you look even our gains this year most of it was on rent increases.

Speaker 1: So we've been pretty consistent when you look even our gains this year, most of it was on rent increases, you know, on terms and renewals. So, on terms, probably somewhere between.

Turns and renewals.

So.

<unk> probably somewhere between.

Speaker 1: 7 and 10% on churns, I think is reasonable to expect in that market.

7% and 10% on turns I think it is reasonable to expect in that market.

Okay.

Speaker 7: Okay, and then just lastly, I think you put this in in the past, but I don't think I saw it this time. You talked about the energy investments that you guys are making. Do you guys set a target return for those investments, and if so, what would that be?

And then just lastly.

But I think it puts us in the past, but I don't think I saw at this time, you talked about the energy investments.

You guys are making do you guys set a target return for those investments and if so what would what would that be.

Speaker 2: We do set target returns and typically we're running around 10% and we'd go as low as 7% for the right ones. And then sometimes they're, you know what, 25%. So it is through the range, but yes, we have a target and tends to be overall and we tend to beat it.

We do set target returns and typically we're running around 10% and we'd go as low as 7% for the right one.

And then sometimes they're 25% so it is through the range, but yes, we have a target and tend to be overall and we tend to beat it.

Okay. So similar to your investments in the redoing of suites.

Speaker 7: Okay, so similar to your investments in redoing the suites? In the unit. Exactly. Okay.

Exactly.

Okay. Thanks, I'll turn it back.

Okay.

Speaker 5: Your next question comes from Mario Sarek with Scotiabank. Please go ahead.

Your next question comes from Mario <unk> with Scotiabank. Please go ahead.

Hi, good morning.

Speaker 9: Hi, good morning. Maybe coming back to the turnover, the 25%. Do you have any color in terms of how that's stratified amongst the average tenant lease duration? So for example, what the turnover rate looks like within the portfolio for tenants that have been around for less than three or five years versus tenants that have been around a lot longer. No, we don't. We don't have that breakdown for you, Mario.

Maybe maybe.

Coming back to the turnover.

The 25%.

Do you have any color in terms of how that stratified amongst.

Average tenant lease duration. So for example.

Apparel, where it looks like within the portfolio for kind of quite a bit around for Washington, three or five years versus.

Tenants that have been around a lot longer.

No. We don't we don't have that breakdown for humira.

But it's a good question because I'm curious about it now.

Can give us some thought and take a look at it.

Speaker 10: Sure. Just curious anecdotally, whether, like, you know, whether you're seeing a disproportionate amount of that turnover in tenants that,

Sure just curious anecdotally whether right now what are you seeing a disproportionate amount of our turnover.

Thanks Scott.

Speaker 10: I haven't been around too long and therefore impacting the market potential on turning the portfolio.

I haven't been around too long and therefore in parkman kind of mark to market potential.

Our alternative portfolio.

Okay, we will have to do some research at this time.

Yes.

<unk>.

Speaker 3: I can probably just maybe add a little bit to that, not so much the length of the tenant, but what we're seeing is that we really saw a tightening of turnover in Halifax.

I can probably just maybe add.

A little bit to that not so much the length of the tenant but what we're seeing is that we really saw a tightening of turnover in Halifax.

Speaker 3: in late 2021 and what we're seeing over that what's turning is the markets that are higher than our average, right? So what you have is such a tight market that more the...

Late 2021.

And what we're seeing over that what's turning is the markets that are higher than our average right. So what you have is such a tight market that more of the affordable rent. We're seeing those people stay right theres less options. It's a very tight market. So September October November December we really Todd tightening here in Atlantic Canada.

Speaker 3: affordable rents, we're seeing those people stay. There's less options. It's a very tight market. So, you know, September , October , November , December , we really saw a tightening here in Atlantic Canada, which, you know, regularly turned, but 30, 33%, and that has come down. Whereas Ontario always did have more of that 10 to 15, sorry, 15 to 20, 25, depending on the market turnover. So I wouldn't say, I know today we can find out the length of the tenant, but I would say that absolutely the more affordable.

Which.

<unk> turned that 30% to 33% and that had come downward, Ontario, all we did have some more of that 10 to 15 15 to 2025, depending on the market turnover. So I wouldn't say I know today, what we can find at the length of the tenant, but I would say that.

Absolutely the more affordable.

Rents that we have are trading less and my only other comment that is quite apparent is that.

Speaker 3: rents that we have are turning less. And my only other comment that is quite apparent is that.

Speaker 4: for the percentage of our units that would have a student because of all the universities that we have in our marketplaces, they would be typically no more than two years because they tend to come in after the first or second year and stay a couple of years and then they would sort of move on once they graduate.

The percentage of our units that would have a student because of all the universities that we have.

In our marketplaces.

They would be typically no more than two years, because they tend to come in after the first or second year in a couple of years and then they would just sort of move on once they graduate.

So thats fairly typical.

Right Okay.

Speaker 9: That all makes sense. Thank you for that. On the development side, you noted the record of 168 million expected completions in 2022. Do you have a sense of what type of SFO per unit growth those completions can drive in 2022 versus 2023?

Thank you for that.

Just maybe turning to on the development side.

In order to record 168 million of expected accretion in 'twenty. Two did you have a sense.

So what type of.

Appropriate up growth those completions can drive in 'twenty two versus 'twenty three.

I think that the speed of lease up of course is going to be a big factor there I think that the.

Speaker 1: I think that, you know, the speed of lease-up, of course, is going to be a big factor there. I think that the biggest impact from an FFO per unit perspective is going to be felt in 2023, I'd say by Q4.

The biggest impact from an <unk> per unit perspective is going to be felt in 2023.

Yes.

I would say by Q4, I think we could test.

Speaker 1: We will likely see some positive impacts, but the first quarter or two.

We will likely see some positive impact, but the first quarter or two.

We will likely not be positive from an <unk> because of higher interest expense on that but so I think 2023 is when you can count for the big guys.

Speaker 1: will likely not be positive from an FFO because of our interest expense on that. So, I think 2023 is when you can count for the big FFO impact on those ones that are just coming online. But, again, to add another element of color to it, I mentioned $1.7 million was created in FFO last year on the three developments that we finished and leased up. This year, they'll do about $3 million in FFO.

On the ones that are just coming online, but again to add another.

Element of color to it.

Mentioned $1 7 million was created in <unk> last year on the three developments that we.

Finished and leased up this year, they'll do about $3 million in <unk>.

Okay.

Speaker 9: Okay. My last question, just in terms of the IFRS fair value being during the quarter is pretty strong at $66 million. Even better considering that your IFRS cap rate didn't really change very much quarter over quarter Q4 versus Q3. So presumably, it was driven by a higher expected NOI going forward. What would be some of the underlying assumptions that drove kind of the higher expected structural NOI going forward relative to prior quarter?

Okay.

My last question just in terms of the alright.

For us for valley being during the quarter was pretty strong at $66 million.

Even better considering that the garage tougher it didn't really change very much quarter over quarter Q4 versus Q3.

So presumably it was driven by higher expected NOI going forward, what would be some of the underlying assumptions.

What drove kind of a hardware expert structural NOI going forward relative to prior quarter.

I think it's always looking at the rent growth opportunities revisiting what with the tightening of the market.

Speaker 1: It's always looking at the rent growth opportunities, revisiting what, you know, with the tightening of the market, they can see reflecting what's really happening out there. So from a top-line growth perspective and on the expense side, I mean, we do expect those of course to grow but just like we're seeing, we expect positive NOI growth. I think it's more driven by the top-line growth expectations.

Vacancy, reflecting what's really happening out there so from a topline growth perspective.

And on the expense side I mean.

We do expect those of course to.

<unk> just like we're seeing we expect positive NOI growth I think it's more driven by that top line growth expectations.

Perfect. Okay. Thank you.

Your next question comes from Joanne Chen with BMO. Please go ahead.

Speaker 5: Your next question comes from Joanne Chen with BMO. Please go ahead.

Speaker 11: Hi, good morning. Maybe just sticking on the development front, I guess just kind of how are you guys approaching, you know, the pressure on perhaps some of the development repositioning costs due to inflation? Do you think that's going to ease over the near term?

Hi, good morning.

Just sticking on the development front.

I guess just kind of how are you guys approaching.

The pressure on perhaps some of the development repositioning costs due to inflation do you think thats going to ease.

Over the near term.

In terms of the development cost.

Speaker 2: In terms of development costs, the question was about repositioning our average cost. Well, I guess costs on both your development pipeline as well as some of the repositioning efforts that you guys have in mind.

The question was about repositioning.

Average cost.

Costs on both your development pipeline as well as some of the repositioning effort.

You guys have.

<unk>.

Again for the ones that are really fit that we're finishing up this year essentially everything was fixed and really the increased pricing is just more of a delay relative to weather.

Speaker 4: Again, for the ones that we're finishing up this year, essentially everything was fixed. And really, the increased pricing is just more of a delay relative to whether it's labor in the last few months of COVID, or we're waiting around for building inspectors to show up and give us the final approval. There's a little bit of a leg from a, or increase because of the leg.

Whether it's labor in the last few months of Covid or.

We're waiting around for building inspectors to show up and give us. The final approval there is a little bit of a lag from a.

For increase because of the lag of getting it finished.

Speaker 4: The new projects that we believe we're going to be starting this year, again, we go in and we fix the pricing of about 80% of the cost with fixed price contracts and therefore locking in essentially most of the cost. And we still have the ability to review what we're going to be achieving on rents and the growth rate.

The new projects that we're we believe we're going to be starting this year again, we go in and we fix the fixed pricing of about 80% of the cost with fixed price contracts and therefore locking in.

Essentially most of the cost and we still have the ability to review, what we're going to be achieving on rents.

And the growth rate in two or three years' time.

And on the repositioning we would see that general general inflation of about 5% is what we're looking at and we think it will make its way through the repositioning as well.

Speaker 2: And on the repositionings, we would see that general inflation of about 5% is what we're looking at and we think it will make its way through the repositionings as well.

Got it okay now that's helpful.

Speaker 12: Okay, now that's helpful. And I guess, I think we touched upon this earlier, but, you know, in terms of the rising coffee taxes, you did note that they go up by 23%, but could you kind of talk to what you're thinking about some of the other regions, such as, you know, in your, in Nova Scotia or Ontario? Do you think that...

And I guess I think we touched upon this earlier, but.

In terms of the rising property taxes, you did note that eventually go up by 23%, but could you.

So what are you thinking about some of the other regions.

Yeah I'm here.

So I'm curious do you think that.

Speaker 12: You're going to see similar heights in terms of property tax.

We're going to see similar height.

Chemical coffee boxes.

We wouldn't expect those kinds of increases outside in other provinces, though I'd say onto.

Speaker 1: We wouldn't expect those kinds of increases in other provinces. So I'd say Ontario, because the assessments are flat, that that will be much more moderate.

Ontario, because the assessments are flat that that will be much more moderate increase.

Okay.

Speaker 1: And then Nova Scotia, I'd say, you know, we're expecting somewhere closer to, you know, 5 to 6% increase in Nova Scotia. And PEI is around 3 and the New Brunswick situation is a little bit fluid relative to, you know, that was the estimate.

And then Nova Scotia I'd say.

We're expecting somewhere closer to 5% to 6% increase.

So <unk> is around three and the new Brunswick situation, it's a little bit fluid relative to.

That was the estimate the first assessments that we received with those numbers and there is still talk.

Speaker 4: the first assessments that we received with those numbers. And there is still talk relative to there might be something happening there in terms of the final dollar amount for this year.

Relative to there might be something happening there in terms of the.

Final.

Dollar amount for this year.

Got it.

Speaker 11: Okay, and maybe just switching gears on the acquisitions from you know, obviously very busy year for you guys But just kind of your target of over 150 million of acquisitions Could you talk to which markets right now you guys would be the most focused on would that be Ontario still? And how long should we be thinking? Sorry, go ahead

Okay, and maybe just switching gears on the acquisition front.

Obviously very busy for you guys.

But just kind of your target of over 100 casinos in Nevada.

Could you talk to which markets right now.

The most focus on would that be Ontario's bill.

And how long material thinking.

Oh, sorry go ahead.

Ed.

I'm just kind of just add on.

Speaker 11: Oh, and just kind of just add on to the question is that, how are you, should we be thinking about, obviously, you guys have a lot of liquidity, but just kind of, you know, how should we be thinking about the funding of that and whether there's any capital recycling opportunities within your firm?

The question is that how are you should we be thinking about obviously, there's a lot of liquidity.

Just kind of.

Should we be thinking about the funding of that and whether there is any capital recycling opportunities within your current portfolio.

Yeah, I mean again, it's an interesting.

Speaker 4: I mean, again, it's an interesting, I would say that the first...

I would say that the the first.

Speaker 4: Six weeks of the year, the level of opportunities has increased right across the country. There's a lot of stuff that's being marketed or talked about that's coming to market.

Six weeks of the year the level of.

Opportunities has increased right across the country, there's a lot of stuff that's being marketed.

Or talked about that's coming to market.

For us.

Speaker 4: It's about hitting sort of deals and opportunities that sort of fit into our sort of main strategy. Ontario is still a big focus for us, you know, to build on the Kitchener-Waterloo area is a priority and we see opportunities there.

It's about hitting sort of.

Deals and opportunities that sort of fit into our sort of main strategy.

Ontario is still a big focus for us.

To build on the Kitchener Waterloo area.

Priority and we see opportunities there.

Speaker 4: And then out west, Alberta is full of them. It's just a matter of what really is going to work long term. You know, that market, I think the economy there is turning around. I mean, it was in the papers this morning that they're going to have a surplus this year at the provincial level.

And then out west.

Alberta is full of them. It's just a matter of what really is going to work long term.

That market I think the economy. There is turning around I mean, it was in the papers this morning.

We're going to have a surplus this year at the <unk>.

<unk> level.

Speaker 4: And there's lots of really interesting opportunities in southern BC and the islands. So those are the key areas.

And there's lots of really interesting opportunities in southern DC in the island. So those are the key areas.

Speaker 4: And I think part of your other question was about recycling current assets, we are looking at a number of.

And I think part of your other question was the recycling.

Current assets.

We are looking at.

Number of.

Speaker 4: properties that we might recycle if we can get our price and that's part of the program as well.

Properties that we might recycle if we can get a price and that's part of the program as well.

Okay.

Speaker 12: Okay, I thought it was really helpful. I will turn it back, thanks.

Right.

I mean, I wasn't really helpful. I will turn it back thanks.

Okay.

Speaker 5: Your next question comes from Matt Kornack with National Bank Financial. Please go ahead.

Your next.

Question comes from Matt <unk> with National Bank Financial Please go ahead.

Speaker 13: Hi, guys. Just a quick follow-up on the property tax front. Can you speak to how iterative that process is? Like, it sounds like New Brunswick is a unique circumstance, but do you often kind of contest these property tax increases and how successful are you in contesting them historically? I mean, it's almost a – it goes without saying that when you get these, if there's any ones that are relatively high versus the other ones, you would appeal it.

Hi, guys.

Just a quick follow up on the property tax front can you speak to how iterative that processes.

It sounds like New Brunswick is a unique circumstance, but do you often kind of contest. These property tax increases and then how successful are you in contesting them historically I mean, it's almost it's a it goes without saying that when you get these if there is any ones that are relatively high versus the other ones you would appeal it.

Speaker 4: So as a normal course business, we're appealing assessments basically in every province.

So as a normal course business were appealing assessments basically in every province.

Okay.

Yep.

Speaker 4: This one is a little bit unique where New Brunswick, where they did this, and there's been a lot of sort of like calls into the government questioning this, or tenant association up there has been the lead on this, and I think the government is listening. So, what will they do? I don't know, but, you know, the discussion is ongoing and we'll see.

This one is a little bit unique where new Brunswick, where they did this.

There's been a lot of sort of like.

Calls into the government questioning this tenant association up there has been the lead on this and I think the government is listening so what will they do I don't know but.

The discussion is ongoing.

And we'll see.

Speaker 13: Fair enough. And then this is probably one for Nancy, and I don't know if you have the numbers in front of you, but the rent increases on renewal, turnover and repositioning were presented on an annual basis. I don't think I saw the quarterly numbers, but do you have those in front of you? Or could you kind of give a directional sense as to how they would be versus the.

Fair enough.

And then this is probably one for Nancy and I don't know if you have the numbers in front of you but.

The rent increases on.

Our renewal turnover and repositioning were presented on an annual basis I don't think I saw the quarterly numbers, but do you have those in front of your could you kind of give a directional.

<unk> sense as to how they would be versus the.

Speaker 13: uh... annual figures it looked like throughout the course of the year there there was a bit of an incremental increase in each of those category

Annual figures it looked like throughout the course of the year, there was a bit of an incremental increase in each of those categories.

So I think the quarterly just presented in the chart in the MD&A.

Speaker 3: So I think they're quarterly just presented in a chart, NAMDNA, but I can follow up with the actual numbers. I think they're just charted and not quarterly and not the numbers explicitly said. So I can follow up with that for you, Matt. Okay, fair enough. That's great. Thanks guys.

But I can follow up with the actual numbers I think I think they're just charted and not at.

Quarterly and knock that number.

So I can follow up with us for you Matt Okay fair enough that's great. Thanks, guys.

Yes.

Yeah.

Your next question comes from Jamie Shen with RBC capital markets. Please go ahead.

Speaker 5: Your next question comes from Jimmy Shan with RBC Capital Markets. Please go ahead.

Hey, good morning, guys.

Speaker 13: Just to circle back on the turnover comment as it relates to your rental program. So if more affordable units are turning less, and I don't know if it's a fair assumption, but I would assume that

Just to circle circle back on the turnover comments.

As it relates to the to your radio program.

So if more affordable units are turning less and I don't know if it's a fair assumption, but I would assume that.

Speaker 13: the more affordable units is where you possibly can see higher ROIs. So is it fair to assume that the 13% that you achieved last year were tilted more towards the let's call them the lower opportunity sets? Is that fair?

The more the more affordable units as the way you, possibly can see higher rois. So is it fair to assume that the 13% that you achieved.

Sure were sort of tilted more towards the let's call them the lower opportunity sets.

Sir.

No you know what do you mean, I would say that that's not it doesn't run that way.

Speaker 2: No, you know what Jimmy, I would say that it doesn't run that way. So for us, when we do the increase, we do it throughout the portfolio and it's surprising that every sector has the opportunity and then we would increase the rent on a relative basis.

So for US it's when we do the increase we do throughout the portfolio and it's surprising that every sector has had the opportunity and then we would increase the rent on a relative basis.

Speaker 2: Right? So on the lower units, yes. You don't invest the $28,000 there necessarily, some number lower perhaps. You're trying to find your place in the market and you want to meet the market. So they move in each of the segments.

Right.

All of our units, yes, you don't invest the $28000, they're necessarily some number lower perhaps just youre trying to find your place in the market and you want to meet the market. So they move in each of the segments proportionately.

Proportionately.

Speaker 13: I see. So they move in proportion in terms of percentage.

So they move in proportion in terms of percentages.

Speaker 13: whether you're in affordable or not. Okay and then you mentioned I think that the downtime has improved and I would just kind of curious as to you know what is it that you're doing to optimize the downtime on the right.

Yes, it whether you are an affordable okay.

Then you mentioned I think that.

The downtime has improved.

Just kind of curious as to what.

What is it that you're doing to optimize the downtime on the rentals.

Speaker 2: So we're going to a more standardized design, so with materials, for example, in terms of the flooring we're putting in. We've worked with our contractors longer and then get to know our buildings, so we're more efficient that way, that helps. In terms of ordering, it was a hard year in 21 to get all the materials that we needed, but we had a number of long orders on, especially appliances, for example, we're able to address those. So it's a consistent approach that is helping making it work for us.

So we're going to have more standardized design so with materials for example in terms of the flooring, we're putting in.

We've worked with our contractors longer and they get to know our building. So we're more efficient that way that helps in terms of ordering.

It was a hard year in 'twenty, one to get all the materials that we need it but we had a number of long orders on especially appliances. For example, we're able to address those so it's a consistent approach that is that has helped them, making it work for us.

Speaker 2: And we've been at it now. This program's probably gone into its seventh year. So we haven't figured it out. OK.

And we've been at it now this program has probably gone into its seventh year. So.

We haven't figured out okay.

Speaker 13: And then just last for me, just to comment on the acquisition market, Bill, you mentioned in Edmonton, there are lots of them. I was curious as to kind of what are you seeing in terms of appetite for product and kind of the depth of bids that you're seeing in that market?

And then just last for me just to comment on on the acquisition market. Thanks, Bill you mentioned.

There are lots of them.

As to kind of what are you seeing in terms of appetite for product and kind of the depth of bids that you're seeing in that market.

Well the appetite.

Speaker 4: is it just continues to increase in terms of the number of people looking for.

Is it just continues to increase in terms of.

The number of people.

Looking for.

Speaker 4: opportunities in this sort of in our space. I will.

Opportunities in this sort of in aerospace.

I will.

Speaker 4: and I mentioned this to our board yesterday, the one new trend that I've seen right across Canada is that now apartment buildings in GTA are being marketed as a redevelopment play for multi-family.

I mentioned this to our board yesterday, the one new trend that I've seen.

Great across Canada.

Is that now.

Our purpose buildings in GTA are being marketed as a redevelopment play for multifamily.

Meaning that even if it's an 80 or 150 unit building the density could probably take two to three times that and they kind of wanted to sell it on the future upside of the land as opposed to even the income of an apartment building, whereas the trend has been.

Speaker 4: meaning that even if it's an 80 or 150 unit building, the density could probably take two to three times that, and they kind of want to sell it on the future upside of the land, as opposed to even the income of an apartment building, whereas the trend has been retail.

Retail.

Two multifamily vacant land to multifamily now it's multifamily two more multifamily.

Speaker 4: to multifamily. They can land to multifamily. Now it's multifamily to more multifamily. Right. And are people paying up for that? I don't know.

Alright.

And our people paying up for that.

I don't know weekend.

Right.

Understood Okay.

Thanks for the color appreciate it thank you.

Your next question comes from Mike <unk> with Desjardin. Please go ahead.

Speaker 5: Your next question comes from Mike Markidis with Desjardins. Please go ahead.

Hi, good morning.

Speaker 6: Hi, good morning. A couple of questions on my end. First off, with the same property NOI target of 2% to 3%, unless I missed it, I'm not sure if you gave any indication of where you'd expect the top line growth and the OPEX inflation. If you could give a little bit more color on that, that would be great.

Couple of questions on my end first off with the same property NOI target of 2% to 3%.

Yes, I missed it I'm not sure. If you gave any indication of where you would expect the top line growth Opex inflation, if you could give a little bit more color.

On that that would be great.

Speaker 1: For top for top line growth with that, I'd say, you know, three and a half to four, maybe a little bit above four, we'll be working hard to get that.

Great for top line growth with that I would say three and a half two for maybe a little bit above four we will be working hard to get that.

On the top line on the top line great topline yet.

Speaker 6: On the top line. Is that OK? On the top line. OK. Yeah.

Speaker 6: Okay, great. Just with respect to your lower leverage target, I know you've been moving towards a lower debt-to-fair value slowly over time. On the chart in your deck, the normalized debt to EBITDA has been trending higher. So I guess two-part question there. What's been driving that higher is the first point. And then secondly, do you expect that that will reverse over the course of the next little while as you move toward the lower debt-to-fair value?

Okay great.

Just with respect to your lower leverage target I know you've been moving towards lower debt fair value slowly over time.

On the chart in the deck normalized EBITDA has been trending higher so I guess two part question there what's been driving that higher is the first point and then secondly.

Do you expect that that will reverse over the course of the next little while as you move towards the lower dose.

I do think that.

Speaker 1: I do think that we are even just the deleveraging we just did is helping us move that down. I think as part of what drives it up a bit too is low cap rate environment when we're acquiring that that has an impact and especially as we put the equity in the ground early on our development as we complete those.

We are even just the deleveraging we did just did in helping us move that down I think.

Part of what drives it up a bit too is low cap rate environment. When we're acquiring that that has an impact and.

Especially as we put the equity in the ground early on our developments as we complete those.

Speaker 1: essentially the last half is 100% debt, so as we're completing those. So as more of those get completed as well and we start to see the income of those, those two things are going to help and as we continue to grow that NOI every year that's also going to help. So I think that we have the opportunity to bring that down.

So essentially the last half of the 100% debt, though as we're completing the so as more of those get completed as well and we start to see the income of those those two things are going to help and as we continue to grow that NOI every year. That's also going to help so I think that we.

We have the opportunity to bring that down.

Okay that makes sense, thanks, and then last one here.

Speaker 6: I know you take a long-term approach to the business and your geographical diversification targets. I was just curious to get your thoughts given the

Maybe Phil I know you can take a very we take a long term approach to the business in your geographical diversification targets.

Curious to get your thoughts given the.

Speaker 6: election that we have and maybe some of the political events that are happening in Ontario in the short term, has that lessened your appetite to invest in Ontario or is it a non-event?

Election that we have and maybe some of the political events that are happening, Ontario in the short term is that lessened your appetite to invest in Ontario or is it.

Is it a non event.

Yeah.

Well I mean.

Speaker 4: What governments can do, you can never say it's a non-event. But reality is, with the population of Ontario,

The what governs can do you cannot you can never say, it's non event, but reality is with.

With the population to Ontario.

It continues to grow it will see the largest percentage of the new Canadians that come into the country.

Speaker 4: continues to grow, it will see the largest percentage of the new Canadians that come into the country.

And I was again hit it yesterday I was looking at it but it was a report on GTA last year.

Speaker 4: And I was, again, I had it yesterday, I was looking at it, but it was a report on GTA last year.

Speaker 4: of the number of multifamily rental units that was delivered to the GTA, and that number, and again, don't quote me, but it was surprisingly low for the size of the city in the urban area.

The number of multifamily rental units that was delivered to the GTA and that number and again don't quote me, but it was surprisingly low for the size of the city and the urban area. So again, what you have is the backdrop of very favorable fundamentals.

Speaker 4: So again, what you have is the backdrop of very favorable fundamentals for the multifamily apartment business.

<unk> for the multifamily apartment business.

Speaker 4: And again, I think that if we know what the rules are and they're consistent, then we'll be able to make a very good living being in the multifamily business long term.

And again I think that because we know what the rules are and they are consistent and then we'll be able to make.

A very good living being in the multifamily.

Business long term.

Speaker 6: Okay, and then does that I guess to to restate my question, are you.

Okay, and then does that I guess to restate My question are you.

Speaker 6: Are you, in the short term until you see the election outcome, are you less inclined to invest in Ontario over the next several months, or is it not? No, I'm not less inclined.

Are you in the short term until you see the election outcome are you less inclined to invest in Ontario over the next several months or is it not.

Yeah.

No I'm not.

Good morning.

Okay.

I appreciate that thank you very much.

Thanks.

Your next question comes from David Crystal with Echelon. Please go ahead.

Speaker 5: Your next question comes from David Crystal with Echelon. Please go ahead.

Speaker 7: Thanks. Good morning, guys. Just looking at rising fuel and utility costs, are there any green investments that may not have made sense before that are starting to look a little more appealing? Are existing investments and projects you had been looking at and had in the pipeline, are returns on those looking better in this environment?

Thanks, Good morning, guys.

Just looking at rising fuel and utility costs are there any green investments that may not have made sense before that are starting to look a little more appealing.

Our existing investments and projects you had had been looking at and how did the pipeline our returns on those looking better in this environment.

Yeah.

The answer is yes, I mean, it's a function of how fast we can roll those out.

Speaker 4: The answer is yes. I mean it's a function of how fast we can roll those out. But again, the real role principle is reduce the consumption of all these expenses in terms of your energy cost, whether it's water, whether it's electricity. And so we got a program and we will continue to sort of move ahead with that.

But again, it's it's the the overall <unk>.

<unk>.

Reduce the consumption of all these expenses.

Of your Europe .

Energy cost, whether it's water whether its electricity and so we've got a program and we will continue to sort of move.

Ahead with that.

So we would have done so far.

Speaker 2: So we would have done 40 boiler upgrades this year. That'll save us $80,000 a year, which is great. And then 320 tons of greenhouse gas emissions as well. So what we like in particular is when we do these energy conversions that affect consumption, so we can use less water and less electricity and less fuel, that's the best way to go. So yes, when we're making those investments, we do think.

<unk> boiler upgrades this year that'll favorite to $80000, a year, which is great and then 320 tonnes of greenhouse gas emissions as well so what we like in particular is when we do these energy conversions that affect consumption. So we can use less water and less electricity unless fuel that's the best way to go so yes when were made.

Those investments we do think forward, we know that there's going to be pressure on electricity rates, we know there's pressure on <unk>.

Speaker 2: forward. We know that there's going to be pressure on electricity rates, we know there's pressure on commodities for the fuel, so we're making our investment today with the long-term implications. Meanwhile, we're also doing what we should be doing on the ESG side and helping to mitigate those gaps.

Commodities for the fuel so we're making our investments today with a long term implications. Meanwhile, we're also doing what we should be doing on the ESG side.

In helping to mitigate.

<unk> mission.

Speaker 1: And adding the growing cost of carbon every year, too, really augments that return as well.

And adding the growing cost of carbon every year to really augment that return as well.

Speaker 7: Okay, thanks. And I mean, you've got a greenhouse gas emission reduction target of 15%. Do you have any similar target across kind of all utilities, you know, water savings, electrical, and fuel utilization or consumption? And would that be front-end loaded? Or how would you look at timing on those?

Okay. Thanks.

You've got a you've got a greenhouse gas emission reduction target of 15%.

Do you have do you have any similar.

Target across kind of all utilities water savings electrical.

And fuel utilization or consumption.

Would that be front end loaded or how would you look at timing on those.

Speaker 3: Yeah, so publicly we have just a greenhouse gas target, but that ties right into the energy consumption, and we are also focusing on water and waste. All these things are tracked. We submit, do the grad submission along with others, and all that sort of consumption now is reviewed, and we have a whole inventory on that and it's measured, so we're focused on all those things. It goes hand-in-hand with reducing costs, reducing consumption, and reducing greenhouse gas, but water and waste is also on our mind.

Yes so.

Obviously, we have just a greenhouse gas.

Target, but that ties right into the energy consumption and we are also focusing on water and waste all of these things are tracked.

We.

Do the grass submission of along with others and all of that sort of consumption. Now is reviewed it has we have a whole inventory on that and is measured so where we're focused on all of those things and it goes hand in hand, with reducing costs, reducing consumption and reducing greenhouse gas water and waste is also an awful lot of airline.

Okay, great. Thanks, I'll turn it back.

Speaker 7: Okay, great. Thanks. I'll turn it back.

Thanks.

Your next question comes from Brad.

Speaker 5: Your next question comes from Brad Sturgis with Raymond James. Please go ahead.

Sir just with Raymond James Please go ahead.

Speaker 14: Hi there, just a couple of quick questions here, just to go back to your comments there quickly on capital recycling and sound.

Hi, there just a couple of quick questions here.

Go back to your comments there quickly on capital recycling it sounds.

Speaker 14: pretty opportunistic at this stage. I'm just curious if you could give a little bit more color on the quantum of what could be potentially under review and how we should think about that if you were to execute.

Pretty opportunistic at this stage.

Curious if you could give a little bit more color on I guess, the quantum of what could be potentially under review and and.

How we should think about that if you were to execute.

Yeah.

I think we will save that for another day.

The answer.

Okay.

Speaker 14: And then, on the acquisition environment, obviously, as you suggested, it's pretty active. Is the opportunity still mainly one-off asset opportunities, or are you seeing opportunities for small portfolios, for example?

And then.

On the acquisition environment, obviously as you suggest it's pretty active.

The opportunity is still mainly one off asset opportunities or are you seeing opportunities for us.

For for small portfolios for example.

Speaker 4: There are opportunities for mid-size like up to 2,000 units across the country, better than I'm aware of, in the 1,000 unit range and then they're down to the single property of whether they're 50 or 300 units. There's a lot of product.

There are opportunities for mid sized like up to 2000 units across the country that I'm aware of.

In 1000 unit range, and then they're down to the single property of whether they are 50 or 300 units.

There's a lot of product.

Okay, I'll turn it back thanks.

Thank you.

Ladies and gentlemen, as a reminder, if you do have a question press Star. One. Your next question comes from Dean Wilkinson with CIBC. Please go ahead.

Speaker 5: Ladies and gentlemen, as a reminder, if you do have a question, press star one. Your next question comes from Dean Wilkinson with CIBC. Please go ahead. Thanks. Morning, everybody.

Thanks, Good morning, everybody.

Hi.

Speaker 15: Bill, perhaps, when you look at the landscape that's in front of you, you look at the rate environment, it strikes me that the MHC business is just something that's becoming more and more favorable. Are there either development or acquisition opportunities for MHCs? I mean, the spreads are just so much wider. Is there anything out there to go after?

Phil perhaps.

When you look at the.

Landscape that's in front of you, though you look at the rate environment. It strikes me that the MHC businesses, just something thats, becoming more and more favorable.

Are there either development or acquisition opportunities for MH seeds I mean, the spreads are just so much wider.

Is there anything out there to go.

After.

We've been looking.

Speaker 4: It's another sort of area of renewed focus in the last year or so. Last year it would have been described as very hard to get new product for your parks in terms of buying it from the manufacturers. We are working hard with our manufacturers in Ontario and Atlantic Canada to get more product. And it's interesting that

It's another.

Sort of area of renewed focus in the last year or so last year. It would've been described as very hard to get.

New product for your.

Parks in terms of buying it from the manufacturers.

We are working hard with our manufacture manufacturers in Ontario, and Atlantic can get more product.

And it's interesting that for all of the looking that we are doing.

Speaker 4: For all the looking that we are doing, it's no different than the apartment business where on a per unit or per pad basis, what was the pricing years ago is a lot higher now.

It's no different than the apartment business, where on a per unit or <unk>.

Per pad basis, what was the pricing years ago is a lot higher now.

Speaker 4: but depending on the market, so has the rent increase.

But depending on the market.

So has the rent.

Increased.

And I think we're as you based on your question sort of alluded to.

Speaker 4: And I think we're, as you, based on your question, sort of alluded to, there's now, we're looking at where are there opportunities to go build a new.

There is now we're looking at where are there opportunities to go build.

Our new App.

Community.

Speaker 4: understanding that at one time the cost service put in roads and the infrastructure would have been $30,000. It's probably somewhere between $60,000 to $70,000 now. It's starting to make really good economic sense. And the profit on the homes has increased quite a bit.

Understanding that the.

One time, the the cost service put in roads and the infrastructure would've been 30000 is probably somewhere between 60 to 70000 now.

It's starting to make really good economic.

Since then the profit on homes has increased quite a bit so overall very affordable, but I think in the years to come it's going to be another.

Speaker 4: So overall, very affordable, but I think in the years to come, it's going to be another area of focus for us.

Area of focus for us.

Speaker 2: Great. I heard a rumor they're not building any more land, so it makes sense. Thanks. That's it for me, guys. Thank you. Thanks.

Greg I heard a rumor theyre not building any more land.

Makes sense.

Right.

Thanks, that's it for me guys.

Thank you.

Okay.

There are no further questions at this time. Please proceed.

Speaker 4: I would like to thank everybody for participating today and we look forward to our next analyst call which will be May 4th to talk and review our first quarter of 2022. Thank you.

I would like to thank everybody for participating today, and we look forward to our next analyst call, which would be may 4th two.

And review our first quarter of 2022, thank you.

Speaker 5: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Have a great day.

Ladies and gentlemen, this concludes your conference call for today, we thank you for participating and ask that you. Please disconnect your lines have a great day.