Q4 2023 Boardwalk Real Estate Investment Trust Earnings Call

February 23, 2024

And we will conduct a question and answer session. If at any time. During this call you will require immediate assistance. Please press star zero for the operator.

This call is being recorded on February 23rd 2024.

I would now like to turn the conference over to Eric borrowers Vice President of Finance and Investor Relations. Please go ahead.

Sir and welcome to the Boardwalk REIT 2023 fourth quarter results conference call.

With me here today are Sam Coleus, Chief Executive Officer, James Hall, President, Lisa <unk>, Chief Financial Officer, and Samantha Coleus gun senior VP of corporate development and governance we.

We would like to acknowledge on behalf of boardwalk, the treaties and traditional territories across our operations and express gratitude and respect for the land. We are gathered on today and we now know as Canada, we respect indigenous peoples and communities as the original stewards of this land.

We come with respect for this land that we are on today for all the people who have and continue to reside here and the rich diversity of first nation in <unk> and.

<unk> peoples.

Please note that this call is being broadly distributed by way of webcast.

You have not already done so please visit visit us at <unk> Dot Com slash investors, where you will find a link to today's presentation as well as PDF files of the Trust's financial statements MD&A and annual report.

Starting on slide two we'd like to remind our listeners that certain statements in this call and presentation may be considered forward looking statements. Although the expectations set forth in such statements are based on reasonable assumptions boardwalks future operation and its actual performance may differ materially from those in any forward looking.

Additional information that could cause actual results to differ materially from these statements are detailed in boardwalks publicly filed documents I would like to now turn the call over to Sam Coleus. Thank you, Eric and welcome everyone to our Q4 2023 conference call starting on slide four.

Our strong performance with our GAAP and non-GAAP measures of <unk> per unit net asset value and unit holder equity seen an increase from the same quarter of the prior year and profit has seen an increase quarter over quarter due to stronger apartment rental fundamental leading to higher fair value adjustment.

Slide five shows <unk> per unit growth with a 95% CAGR over the last three years slide six our culture from our humble beginnings in 1984, our resident members are at the top of our organization.

Our leaders put our team first and our team puts our resident members first guided by the Golden rule, we have our peak performing customer service culture that creates exceptional results.

I'd like to now pass it over to surmount the Colgate Scott. Thank.

Thank you so much.

Slide seven our strategy to create value for our stakeholders begins with our people we are grateful for our extraordinary team and family.

Continue to innovate and deliver our place at home for a resident number where level Adler.

Our strategic focus is our best in class organic growth from our strategic decision made several years ago to implement a distribution policy, which maximizes free cash flow reinvestment back into our communities.

<unk>, our proven team and platform to deliver the best service and value to our resident in memory, which results in optimize NOI growth. When we hear all of that with the improvement in apartment rental market fundamentals in our core market on a solid foundation.

Some of the most affordable Rins in Canada, we are well positioned to continue to deliver best in class organic growth.

Creative capital recycling focuses on opportunistic investment into acquisition disposition of our sale of noncore assets developments and investments into our own high quality existing portfolio with a tactical unit buybacks when appropriate to also increase free cash flow are.

It's free cash flow reinvestment back into our communities Leverages, our proven team and platform to deliver the best service and value to our resident members, which results in optimize NOI growth. When we pair all of this with improvement in apartment rental market fundamentals in our core markets on a solid foundation of some.

Our solid financial foundation provides flexibility on our balance sheet with a minimum distribution policy, which maximizes available capital from our growing funds from operations for reinvestment back into our communities with our ladder mortgage renewal approach on CMS the insurance on 96% of our financing. This continues to provide us stability.

Most affordable rent in Canada, we are well positioned to continue to deliver best in class organic growth accretive.

Access to low cost mortgage capital with reduced risk.

Impelling value from our strategic decision to diversify our product offerings into three distinct brand.

Accretive capital recycling focuses on opportunistic investments into acquisitions dispositions or sale of noncore assets development and investment into our own high quality existing portfolio with a tactical unit buyback when appropriate to also increase free cash flow.

All of our living enhance value community and affordable luxury lifestyle. This strategic decision combined with our maximizing our free cash flow reinvestment back into our communities has positioned boardwalk as a leader in multifamily community provider with growing free cash flow.

Our solid financial foundation provides flexibility on our balance sheet with a minimum distribution policy, which maximizes available capital from our growing funds from operations for reinvestment back into our communities with our ladder mortgage renewal approach and CMA to the insurance on 96% of our financings. This continues to provide us stability.

Slide eight.

We continue to deliver leading growth forward, what's existing exposure to strong rental demand non price controls market with record immigration significant organic growth as Alberta has some of the most affordable rental rates in the country with limited new supply versus demand from both internationally and in the prevention of migraine are solid.

Access to low cost mortgage capital with reduced renewal risk.

<unk> value from our strategic decision to diversify our product offering into three distinct brands affordable living enhanced value community and affordable luxury lifestyle.

Foundation in partnership with <unk> allows us to provide some of the most affordable rents in Canada with rising interest rates, making homeownership more expensive and rising construction costs are widening the gap between our replacement cost of our assets and our current valuation construction levels in our core markets remain low relative to anticipated household.

This strategic decision combined with our maximizing our free cash flow and reinvestment back into our communities has positioned boardwalk as a leader in multifamily community providers with growing free cash flow.

With record high immigration into our core Alberta market.

<unk> eight <unk>.

Continued to deliver leading growth boardwalks existing exposure to strong rental demand non price controlled market with record immigration significant organic growth as Alberta has some of the most affordable rental rates in the country with limited new supply versus demand from both international and inter provincial migration, our solid financial.

All of our apartment rentals fundamentals continued to improve with higher revenues as a result of our significant improvement in inflationary adjustment coupled with essentially no new incentives on new and renewing leases.

All of our markets have near 99% occupancy with increasing operating income and strong.

Foundation in partnership with <unk> allows us to provide some of the most affordable rents in Canada with rising interest rates, making homeownership more expensive and rising construction costs all widening the gap between our replacement cost of our assets and our current valuation construction levels in our core markets remain low relative to anticipated household.

Fundamentals slide.

Slide nine shows the significant magnitude and scale on historic level of continued all time record high immigration into our largest region, Alberta from both inner Provincia and international migrants, calling Alberta home.

This significant migration reflects the affordability that Alberta provides relative to other provinces, coupled with significant job vacancy our federal government recently announced a freeze on foreign student visa and we are not expecting an impact in our core market slide 10 shows interprovincial migration versus into Alberta for the current year two.

<unk> with record high immigration into our core Alberta market.

All of our apartment rental fundamentals continue to improve with higher revenues as a result of our significant improvement in inflationary adjustments, coupled with essentially no new incentives on new and renewing leases.

16, and 2006, most interventional migrants are coming from Ontario, and Quebec with a big increase from BC, reflecting in migration into more affordable housing in Alberta from higher housing cost in Ontario, and British Columbia.

All of our markets have near 99% occupancy with increasing operating income and strong.

<unk> fundamentals.

Slide nine shows the significant magnitude and scale on a historic level of continued all time record high immigration into our largest region, Alberta from both Interprovincial and international migrants, calling Alberta homes. This significant migration reflects the affordability that Alberta provides relative to other provinces.

Slide 11 shows strong overall employment growth in Alberta, along with how diversified new jobs are helping with the diversification of the Alberta economy.

Slide 12 shows, Alberta, leading economic growth from high commodity prices, resulting in budget surpluses that will go towards debt repayment and savings contributions for future investment and all of that will also result in smaller interest costs for our Alberta government, Alberta government revenues have increased a significant 30% over the last two years.

Coupled with significant job vacancies are federal government recently announced a freeze on foreign students visas and we are not expecting an impact in our core market slide 10 shows interprovincial migration sources into Alberta for the current year 2016, and 2006, most intervention on migrants are coming from Ontario and <unk>.

Slide 13 continued economic news and headlines that reflect a diversifying economy for Alberta, including an article on the two year cap on international student visa not affecting Alberta, Alberta economy remains strong. In addition, there are many major projects under development in the province of Alberta, which will further promote <unk>.

Back with a big increase from BC, reflecting in migration into more affordable housing in Alberta from higher housing cost in Ontario, and British Columbia.

Slide 11 shows strong overall employment growth in Alberta, along with how diversified new jobs are helping with the diversification of the Alberta economy.

Job opportunities in the future.

Slide 12 shows, Alberta, leading economic growth from high commodity prices, resulting in budget surpluses that will go towards debt repayment and savings contributions for future investments.

Slide 14 shows our large presence and affordable and non price controls market.

Alberto Saskatchewan, representing 62% and 10, 3% of our portfolio respectively.

All of that will also result in smaller interest costs for our Alberta government.

<unk> has the highest Canadian concentration of non price control department amongst our public REIT peers Boardwalk current mark to market, which includes the reduction of incentives averages $173 per suite and equates to approximately a $65 million revenue opportunity side.

Alberta government revenues have increased a significant 30% over the last two years.

Slide 13 continued economic news and headlines that reflected diversifying economy for Alberta, including an article on the two year cap on international student visas not affecting Alberta.

Slide 15 shows our high affordability as defined by <unk>, and our core Edmonton and Calgary market with rent still below 30% of median rental household income to the right of the affordability chart is a graph, which shows occupied rents in Alberta are still tracking below both Alberta and Canadian CPI index inflation there remains.

Alberto the economy remains strong. In addition, there are many major projects under development in the province of Alberta, which will further promote more job opportunities in the future.

Slide 14 shows our large presence and affordable and non price controls market, with Alberta, and Saskatchewan, representing 62% and 10, 3% of our portfolio respectively.

Significant gap between occupied rents and the changeover consumer price index over the last eight years.

Boardwalk has the highest Canadian concentration of non price control department amongst our public REIT peers boardwalks current mark to market, which includes the reduction of incentives averages $173 per suite and equates to approximately a $65 million revenue opportunity.

Florida, our brands continued to provide exceptional value versus the consumer price index over the last eight years.

Slide 16 reflects supply constraint the graph on the left shows the significant imbalance between strong demand or immigration versus supply on new builds and the yellow black and grey with demand or migration accelerating further in our core Edmonton and Calgary marketplaces far outstripping new supply to the right another graph showing how high <unk>.

<unk> costs remained alon persistent higher interest rate slide.

Slide 17 shows the continued downward trend on year over year turnovers occupancy.

See continued close to 99% as a result of strong apartment rental fundamentals and our leading diversified product.

Significant gap between occupied rents and the changeover consumer price index over the last eight years.

Boardwalk rents continue to provide exceptional value versus the consumer price index over the last eight years.

All our key markets.

Slide 18 shows our key operational metrics with high occupancy lower incentives higher occupied ranked resulting in higher revenues for the quarter, reflecting our key strategic decisions made to maximize free cash flow and diversify our product offering yielding significant financial performance.

Slide 16 reflects supply constraints the graph on the left shows the significant imbalance between strong demand or immigration versus supply or new builds and the yellow black and grey with demand or migration accelerating further in our core Edmonton and Calgary marketplaces far outstripping new supply to the right another graph showing how high <unk>.

Slide 19 shows steady net new and renewal rental rates within our self regulated resident friendly centric renewal rate band keeping retention high our turnover in expenses low.

<unk> costs remain along persistent higher interest rates.

17 shows the continued downward trend on year over year turnovers.

Year over year, we have seen a significant improvement existing lease spreads or renewals are strategically moderated to keep providing resident friendly affordable housing options in our core markets, while lowering our cost and getting operational results a win win for all our stakeholders.

Occupancy continues close to 99% as a result of strong apartment rental fundamentals and our leading diversified product.

In all our key markets.

Slide 18 shows our key operational metrics with high occupancy lower incentives higher occupied rents, resulting in higher revenues for the quarter, reflecting our key strategic decisions made to maximize free cash flow and diversify our product offering yielding significant financial performance.

Slide 20 shows a strong two 5% sequential quarterly revenue gain.

Like to now pass the call onto Luisa <unk>, who will provide us with an overview of our portfolio performance and balance sheet Lisa. Thank.

Thank you Samantha.

Moving to slide 21 for Q4 2023 same property net operating income increased by 16, 8% as compared to Q4 2022 with revenue growth of nine 2%.

Slide 19 shows steady net new and renewal rental rates within our self regulated resident friendly centric renewal rate band keeping retention high our turnover in expenses low year over year, we have seen a significant improvement existing lease spreads or renewals are strategically moderated to keep providing resident friendly.

For the year ended December 31, 2023 same property net operating income increased by 13, 7% with revenue growth of eight 8%.

Affordable housing options in our core markets, while lowering our cost and steady operational results a win win for all our stakeholders.

Clinton the trust largest market saw revenue growth of 10, 2% in Q4, 2023, and nine 4% for the year ended December 31, 2023, as compared to Q4 2022, and the year ended December 31 2022, respectively.

Slide 20 shows a strong two 5% sequential quarterly revenue game, we'd like to now pass the call onto leaves us manage who will provide us with an overview of our portfolio performance and balance sheet Lisa.

Operating expenses decreased by one 6% in Q4 of 2023, primarily the result of a milder winter in Q4 2023.

Thank you Samantha.

Moving to slide 21 for Q4 2023 same property net operating income increased by 16, 8% as compared to Q4 2022 with revenue growth of nine 2%.

For the year ended December 31, 2023 operating expenses increased one 6%, mainly due to increased wages and salaries repairs and maintenance and utilities as a result of higher rates.

For the year ended December 31, 2023 same property net operating income increased by 13, 7% with revenue growth of eight 8%.

The team remains committed to ensuring focus and discipline when managing controllable operating expenses.

On slide 22, as a result of the disciplined in managing all expenses, coupled with strong revenue growth as promised the trust experienced margin expansion of 280 basis points from 58, 2% in 2022% to 61% in 2023.

Clinton the trust largest market. So our revenue growth of 10, 2% in Q4, 2023, and nine 4% for the year ended December 31, 2023, as compared to Q4 2022, and the year ended December 31 2022, respectively.

Slide 23 administration cost decreased 600000 as compared to Q3, 2023, however increased by $1 4 million in Q4 2023 as compared to Q4 2020 to the.

Operating expenses decreased by one 6% in Q4 of 2023, primarily the result of a milder winter in Q4 2023 for the year ended December 31, 2023 operating expenses increased one 6%, mainly due to increased wages and salaries repairs and maintenance and utilities as a result of higher rates.

The increase was driven by inflationary wage adjustments at the beginning of the year and increase in software as service as service fees increases in professional services, such as legal tax and government relations as well as larger bonus accruals as a result of the trust's annual financial performance.

The team remains committed to ensuring focus and discipline when managing controllable operating expenses.

Referred unit based compensation increase due to an increase in the number of participants as well as the cost of the program.

Slide 24 illustrates boardwalks mortgage maturity schedule, our mortgages are well staggered with approximately 96% of our mortgage balance carrying <unk> insurance to the Canada mortgage and housing Corporation. This insurance remains in effect for the full amortization of the mortgage and in addition to carrying the government of Canada backing provides axa.

Slide 23 administration costs decreased 600000 as compared to Q3, 2023, however increased by $1 4 million in Q4 2023 as compared to Q4 2020 to the.

As to financing at rates lower than conventional mortgages with a current estimated five year and 10 year, assuming to see rate of 445%.

The current interest rates are above the trust maturing rates the trust maturity curve remains staggered reducing the renewal amounts in any particular year.

Deferred unit based compensation increase due to an increase in the number of participants as well as the cost of the program.

Lastly, the trust has an interest coverage of 283 in the current quarter.

Slide 25 summarizes our summarizes our 2023 mortgage program overall, we renewed $411 2 million as well as secured 137 9 million in new financing at an average rate of four 5% and an average term of seven years included in these financings was 106 million.

Slide 24 illustrates boardwalks mortgage maturity schedule, our mortgages are well staggered with approximately 96% of our mortgage balance carrying neha insurance to the Canada mortgage and housing Corporation. This insurance remains in effect for the full amortization of the mortgage and in addition to carrying the government of Canada backing provides acts.

In a conventional mortgage financing, which was which were renewed on shorter terms to allow for them to be replaced with CMA Sea financing. Upon next renewal. In addition, the trusts obtained $46 5 million of CMA <unk> financing at 389% and a seven year term for its acquisition of the view in Victoria British Columbia.

As to financing at rates lower than conventional mortgages with a current estimated five year and 10 year, assuming to see rate of 445%.

So current interest rates are above the trust maturing rates the trust maturity curve remains staggered reducing the renewal amounts in any particular year.

Lastly, the trust has an interest coverage of 283 in the current quarter.

Our underwriting criteria and our most recent submission to CMA Sea and our lenders has remained in line with our historically conservative estimates.

Slide 26 highlights our 2020 for our mortgage program, which includes approximately 21 million, which was overhauled from December 2023 at the previously in place interest rate to date, we have renewed our forward locked $26 9 million at an average rate of 436% and an average term of five years moving.

<unk> and these financings was $106 million of conventional mortgage financing, which was which were renewed on shorter terms to allow for them to be replaced with female <unk> financing. Upon next renewal. In addition, the trust obtained $46 5 million of CMA Sea financing at 389% and a seven year term for an acquisition.

Moving to the right of the slide we provide a summary of boardwalks available liquidity. The trust is well positioned with approximately $331 million in cash and subsequently funded financings as well as an undrawn $196 million operating lines. This approximate $527 million liquidity provides the trust with a flexible financial position.

Of the view in Victoria British Columbia.

Current underwriting criteria and our most recent submissions to CMA Sea and our lenders has remained in line with our historically conservative estimates.

Slide 27 illustrates the trust estimated fair value of its investment properties, excluding adjustment for <unk> 16, which totaled $7 6 billion as at December 31, 2023, as compared to $6 8 billion as at December 31, 2022.

Slide 26 highlights for 2020 for our mortgage program, which includes approximately $21 million, which was overhauled from December 2023 at the previously in place interest rate to date, we have renewed our forward locked $26 9 million at an average rate of 436% and an average term of five years.

The increase in overall fair value is the result of increases in market rents at select sites and communities as market fundamentals improve as well as the Victoria acquisition, while being slightly offset by an increase the capitalization rates.

Current estimated fair value of approximately $222 per apartment door remains below replacement cost.

Moving to slide 22008, and consultation with our external appraisers, the capitalization rates or cap rates used in determining Q4 of 2023 fair value where increase from Q4 2022. However are the same as those used in Q3 2023.

Slide 27 illustrates the trust estimated fair value of its investment properties, excluding adjustments for <unk> 16, which totaled $7 6 billion as at December 31, 2023, as compared to $6 8 billion as at December 31, 2022.

Albert adjustments were made in Q3, 2023 to the trusts, Ontario, and Quebec assets as well as Calgary and Edmonton.

As it does every quarter. The trust will continue to review completed asset sales transactions and market reports to determine if adjustments to cap rates are necessary. Most recently published cap rate reports suggest that the cap rates being used by the trust protect living fair value are within their estimated ranges.

Current estimated fair value of approximately $222 per apartment door remains below replacement cost.

I'd now like to turn the call to James Hearth to highlight our capital allocation developments and the trust exceptional value James Thank you Lisa.

Our maximum cash flow retention strategy remains key to our ability to opportunistically invest and compound returns for our stakeholders. We are pleased to provide an update on our capital deployment, starting on slide 29, which shares progress on our value add repositioning and renovation program or.

Adjustments were made in Q3, 2023 to the trusts, Ontario, and Quebec assets as well as Calgary and Edmonton.

Our common area and amenity renovations position our communities to offer the best value service and experience to our resident members and are a key contributor to boardwalk success in both strong as well as competitive market conditions.

As it does every quarter. The trust will continue to review completed asset sales transactions and market reports to determine if adjustments to cap rates are necessary. Most recently published cap rate reports suggest that the cap rates being used by the trusts for calculating fair value are within their estimated ranges I would now like to turn the call to James Hart to highlight our capital.

For 2023, our team has completed 10 projects, resulting in over 60% of our total suites benefiting from our common area renovations and.

Allocation developments and the trust exceptional value James Thank you Lisa.

In addition, our suite renovation program continues to be opportunistically used to improve and enhance our offering for residents.

Our maximum cash flow retention strategy remains key to our ability to opportunistically invest and compound returns for our stakeholders.

Our vertically integrated platform provides us with a unique ability to quickly and cost effectively complete these renovations.

We're pleased to provide an update on our capital deployment, starting on slide 29, which shares progress on our value add repositioning and renovation program.

With limited availability in the current strong demand for housing our ability and focus on reducing days vacant are a significant differentiator of our communities.

Our common area and amenity renovations position our communities to offer the best value service and experience to our resident members and a key contributor to boardwalk success in both strong as well as competitive market conditions.

With low availability in our markets and additional initiatives. We are taking is the conversion of existing storage and administrative spaces into rental suites to.

For 2023, our team has completed 10 projects, resulting in over 60% of our total suites benefiting from our common area renovations.

This initiative aligns with our platform optimization and to date, we have added 23 units to the market.

By investing in small renovations to turn spaces from administrative you pardon me administrative views into rental units, we will add much needed additional housing in our communities.

In addition, our suite renovation program continues to be opportunistically used to improve and enhance our offering for residents.

Our vertically integrated platform provides us with a unique ability to quickly and cost effectively complete these renovations.

We are currently under construction for an additional 18 units at our EMEA early stages of assessing feasibility on up to a further 39 units in Alberta.

With limited availability in the current strong demand for housing our ability and focus on reducing days vacant are a significant differentiator of our communities.

In addition to our value add capital improvement program, we continue to seek opportunities for growth with a focus on sourcing strategic and accretive acquisitions and continuing our new development and under supply of housing markets.

With low availability in our markets and additional initiatives. We are undertaking is the conversion of existing storage and administrative spaces into rental suites.

Our recent equity raise in December provides a good trust with strong liquidity and the opportunity to accretively deploy capital to create and compound value.

Initiative aligns with our platform optimization and to date, we have added 23 units to the market.

Investing in small renovations to turn spaces from administrative use pardon me administrative use into rental units, we will add much needed additional housing in our communities.

On slide 30, we summarize the use of our $240 million of net proceeds.

We utilized approximately $70 million to close our acquisition of the circle in Calgary, which was announced in conjunction with our raise in December.

Currently under construction for an additional 18 units at our EMEA early stages of assessing feasibility on up to a further 39 units in Alberta.

Circle is a recently constructed 295 unit community located near the Calgary Soaps Health campus and provides increased operating synergies for our cluster of assets in the area.

The circle has an ideal sweet mix with large unit sizes and excellent appointments.

Negotiated the forward sale of this community in May of 2022 for a purchase price of 264000 per apartment tour.

Our recent equity raise in December provides good trust with strong liquidity and the opportunity to accretively deploy capital to create and compound value.

And upon the completion of lease up over the next couple of months are anticipating a 575% stabilized cap rate.

On slide 30, we summarize the use of our $240 million of net proceeds.

In addition to the $70 million investment in the circle approximately $57 million was deployed toward the repayment in full of four.

First we utilized approximately $70 million to close our acquisition of the circle in Calgary, which was announced in conjunction with our raise in December Circle is a recently constructed 295 unit community located near the Calgary Soaps Health campus and provides increased operating synergies for a cluster of assets in the area.

Walks portion of its construction facility related to the 45 railroad development and granted.

The trust interest rate on the construction facility was approximately six 6% in the period prior to a repayment.

The balance of proceeds from our capital raise has been invested in short duration term deposits that are currently yielding over 5%, earning interest while the trust is actively negotiating accretive acquisition opportunities.

Circle has an ideal sweet mix with large unit sizes and excellent appointments.

We renegotiated the forward sale of this community in May of 2022 for a purchase price of 264000 per apartment tour.

We look forward to sharing an update on these in the coming months.

And upon the completion of lease up over the next couple of months are anticipating a 575% stabilized cap rate.

On slide 31, we provide an update to our ongoing development pipeline to add housing in supply constrained markets.

Pleased to share that the lease up of the second tower over 45 Railroad development is progressing well with approximately 45% of units in the second tower now leased cars.

In addition to the $70 million investment in the circle approximately $57 million was deployed toward the repayment in full of boardwalks portion of its construction facility related to the 45 railroad development and granted.

This project was delivered on time and on budget and we are projecting a stabilized yield at the upper end of our forecasted range.

Interest rate on the construction facility was approximately six 6% in the period prior to a repayment.

For Victoria development pipeline Aspire is our first of three and we are now starting to move construction above grade for this 234 unit development, which is located adjacent to our existing Aurora community.

Balance of proceeds from our capital raise has been invested in short duration term deposits that are currently yielding over 5%, earning interest while the trust is actively negotiating accretive acquisition opportunities.

This development is progressing on budget and we will continue to scale, our Victoria presence alongside our existing communities.

Look forward to sharing an update on these in the coming months.

On slide 31, we provide an update to our ongoing development pipeline to add housing in supply constrained markets. We are pleased to share that the lease up of the second tower over 45 Railroad development is progressing well with approximately 45% of units in the second tower now leased.

Switching to our current valuation slide 32 highlights the exceptional growth and value that boardwalks trust units represent.

Our current trading price equates to an attractive four 8% cap rate on our trailing NOI with our outlook for another year of double digit NOI growth. The forward cap rate at this price is in the mid fives and provides a significant spread to the current cost of mortgage capital and transactional cap rates in private markets.

This project was delivered on time and on budget and we are projecting a stabilized yield at the upper end of our forecasted range.

Recent transactions as shown on slide 33 compare favorably to our current trading price and represents exceptional value with their estimated to be just over 220000 per apartment door and remains well below the increasing cost of replacement.

Development is progressing on budget and we will continue to scale, our Victoria presence alongside our existing communities.

With favorable fundamentals strong leasing trends and leading NOI growth our current valuation represents exceptional value alongside our strong runway for continued earnings growth.

Switching to our current valuation slide 32 highlights the exceptional growth and value that boardwalks trust units represent.

As we close 2023 on slide 34, our performance was on the top end of our revised expectations and a reflection of all our teams dedication and efforts in creating value for all our stakeholders.

Moving into 2024, we see a continuation of this runway for growth, which in part as a result of our own strategic moderation and allowing us to deliver consistently strong results.

<unk> transaction as shown on slide 33 compare favorably to our current trading price and represent exceptional value with are estimated to be just over 220000 per apartment door and remains well below the increase in cost of replacement.

Our 2024 guidance outlook is anticipating same property NOI growth to be between 10, and 14%, while our <unk> is anticipated to range from $3 93 to.

With favorable fundamentals strong leasing trends and leading NOI growth our current valuation represents exceptional value alongside our strong runway for continued earnings growth.

To $4 18 per trust unit.

Our wider 12, five <unk> per unit range from mid point to top and bottom are a reflection of larger base figures and similar to past initial guidance represents approximately a 3% forecast banned from our midpoint.

As we close 2023 on slide 34, our performance was on the top end of our revised expectations and a reflection of all our teams dedication and efforts in creating value for all our stakeholders.

As always we intend to update and tightened our guidance range as the year progresses. Our team is committed to leading in transparency and we will continue to update our stakeholders in the event of any change in conditions that may materially impact our forecast.

Moving into 2024, we see a continuation of this runway for growth.

Which in part as a result of our own strategic moderation and allowing us to deliver consistently strong results.

Our 2024 guidance outlook is anticipating same property NOI growth to be between 10 and 14%.

On slide 35, and in line with our strong <unk> per unit growth in 2023 and forecasted growth for 2024, our board of Trustees has approved a 23% increase to our monthly cash distribution from $1 17 to $1 44 per trust unit on an annualized basis or does.

While our <unk> is anticipated to range from $3 93.

To $4 18 per trust unit.

Our wider 12, five <unk> per unit range from midpoint to top and bottom are a reflection of larger base figures and similar to past initial guidance represents approximately a 3% forecast banned from our mid point.

Tribunal have increased alongside our growing cash flow, while maintaining our industry low payout ratio, providing significant cash flow reinvestment for growth.

We continue to maintain our minimum distribution policy with our payout ratio in 2023 of 32% representing one of the lowest in the sector as.

As always we intend to update and tightened our guidance range as the year progresses. Our team is committed to leading and transparency and we'll continue to update our stakeholders in the event of any change in conditions that may materially impact our forecast.

As we look forward to 2024 are guided <unk> anticipate significant cash flow retention with a similar payout ratio in the low to mid thirties as is customary the trust will review our distribution on a quarterly basis.

Lastly on slide 36, we are finalizing our ESG report for 2023 and look forward to sharing our progress toward leading sustainability stewardship.

We anticipate a report to be published in April.

Our distributions have increased alongside our growing cash flow, while maintaining our industry low payout ratio, providing significant cash flow reinvestment for growth.

We cannot thank all our stakeholders enough for a successful 2023. Thank you to our resident members for calling Boardwalk your home.

To our partners for helping us deliver high quality and affordable housing to Canadians and thank you to our boardwalk team for your continued dedication and commitment in serving all our stakeholders. Thank.

We continue to maintain our minimum distribution policy with our payout ratio in 2023 of 32% representing one of the lowest in the sector.

Thank you and we would be happy to answer any questions cluster.

Thank you, ladies and gentlemen, we will now conduct a question and answer session.

Have a question. Please press star followed by the number one on your touch pad.

Lastly on slide 36, we are finalizing our ESG report for 2023 and look forward to sharing our progress toward leading sustainability stewardship.

To cancel your request please press star two.

Our first question comes from <unk> <unk> from BMO capital markets. Your line is now open.

We anticipate a report to be published in April.

Good morning, good afternoon, everyone. Thanks for taking my questions.

We cannot thank all our stakeholders enough for a successful 2023. Thank you to our resident members for calling Boardwalk your home.

Hi, Frank good morning.

It's great to see that you guys are well capitalized to execute on.

Gross initiatives, but how should we think about your capital.

Deployment towards acquisitions.

Kind of opportunities you are seeing the market today.

Thank you and we would be happy to answer any questions cluster.

Hey, Frank extremes.

Very similar to the acquisition that we made at the circle there as we've talked about with our stakeholders in the past we are seeing opportunity to acquire great recently developed assets and so our team is out there pounding the pavement looking for opportunities similar to that obviously our.

Thank you, ladies and gentlemen, we will now conduct the question and answer session.

Have a question. Please press star followed by the number one on your touch pad.

Wish to cancel your request please press star two.

Your first question comes from <unk> <unk> from BMO capital markets. Your line is now open.

Area, where you're looking for to deploy that capital Accretively.

Good morning, good afternoon, everyone. Thanks for taking my questions.

And more specifically trying to stay within our targeted markets and more specifically markets that.

Hi, Frank good morning.

It's great to see that you guys are well capitalized to execute on.

Don't have price control and where we can scale our existing portfolio.

Gross initiatives.

Got it thanks James.

But how should we think about your capital.

I guess with the benefit of the favorable cost of Datacom apartment construction loan program from AMC and the <unk>.

Appointment towards acquisitions, and what kind of opportunities you are seeing the market today.

GST rebate would you guys consider being more active on the development front.

Hey, Frank extremes.

Similar to the acquisition that we made at the circle there.

Okay.

Hi, Brian Good Sam.

We've talked about with our stakeholders in the past we are seeing opportunity.

Succeeded in creating significant value in our development and especially in what we define and describe as trophy locations once in a generation.

To acquire Great recently developed assets and so our team is out there pounding the pavement looking for.

The opportunity is similar to that obviously our criteria, we're looking for to deploy that capital Accretively.

Locations that better exceptional like our 45 months right on the gold train station.

And more specifically trying to stay within our targeted markets more specifically markets that.

For example, in the prime locations of our Victoria developments right beside.

Don't have price control and where we can scale our existing portfolio.

Large regional hospital of Trans Canada highway or right in the middle of town squares Squire malt.

Got it thanks James.

I guess with the benefit of the favorable cost of debt from apartment construction loan program from CMC and <unk>.

And these these developments our joint venture with Rio can Breo. Another Fantastic example.

PST rebate would you guys consider being more active on the development front.

I'm location right next to the University of Calgary foothills hospital, where communities hardly ever come around for sale and are available and as a result building them in what we define in call Trophy locations is really the best way to position ourselves.

Hi, Frank Good Sam.

Succeeded in creating significant value in our development and especially in what we define and describe as trophy locations once in a generation.

Locations that better exceptional like our 45 rail Thats right on the gold train station for example in the prime locations of our Victoria developments right beside.

And two.

Grow into amazing located.

Ari.

Stable.

And.

Large regional hospital of Trans Canada highway or right in the middle of town squares Squire malt.

Communities that we see very little cyclicality in as well. So we're very very fussy in the design and the location when we do develop and as a result, we see significant value that we create as a result hope I answered that question.

These these.

<unk>, our joint venture with Rio can Breo. Another Fantastic example.

Prime location right next to the University of Calgary foothills hospital, where communities hardly ever come around for sale and are available and as a result building them in our what we defined in call Trophy locations is really the best way to position ourselves.

Yes, that's great.

Thanks for the color.

Have a great weekend guys.

Thanks <unk>.

Your next question comes from Jonathan <unk> from TD Cowens.

Your line is now open.

Thanks.

Morning.

First question just on the guidance on the same property NOI.

And two.

Grow into amazing located.

Yes, the revenue picture is pretty clear pretty easy to map out, but what are your expectations for expense growth.

Gary.

Stable.

And.

Communities that we see very little cyclicality and as well. So we're very very fussy and the design and the location when we do develop and as a result, we see significant value that we create as a result hope I answered that question.

For the year.

Hi, Jonathan it's Lisa.

Speaking to what we call our total rental expenses, so rental expenses inclusive of utilities property tax and our operating cost the guidance raise is suggesting anywhere from mid 2% to mid 4%.

Yes, that's great.

Thanks for the color.

Have a great weekend guys.

Growth in comparison to 2023.

Thanks <unk>.

Okay.

Your next question comes from Jeff Uncle, Jonathan <unk> from TD Cowen. Your line is now open.

That's that's helpful and then just.

And I guess, Tim this is probably mostly for you but does this distribution increase was a little larger than certainly it certainly than I expected.

Thanks, Good morning.

First question just on the guidance on the same property NOI I guess, the revenue pictures pretty clear pretty easy.

How should we think about when when you also talked about having a minimum distribution policy. This was.

But what are your expectations for expense growth.

Guessing this was above the minimum distribution.

Jonathan I'm going to speak to it first and Sam can certainly on color if necessary.

For the year.

Hi, Jonathan it's Lisa.

We're speaking to what we call our total rental expenses, so rental expenses inclusive of utilities property tax and our operating cost the guidance raise is suggesting anywhere from mid two percents to mid 4% growth in comparison to 2023.

Is James did articulated in his prepared remarks. This does remain within our minimum distribution policy and so the increase in distribution. While we appreciate it was larger than most would have expected. It is coming with our growing <unk>. So after two consecutive years of the current year <unk> growth in 2023, coupled with what we're forecasting for 2024. This does remain in line with <unk>.

Okay.

A minimum distribution policy as taxable income is growing James did also mentioned our payout ratio for 2024 on our forecasted guidance range is expected to be low to mid 30. So we're still staying within the same payout ratio and it is still a minimum distribution policy.

That's that's helpful and then just.

And I guess, Sam this is probably mostly for you but does this distribution increase was a little larger than certainly than I expected.

How should we think about when when you also talked about having a minimum distribution policy. This was.

Okay.

Okay go ahead Sir.

No go ahead Bruce.

I'm guessing this was above the minimum distribution.

Just going to say so so going forward when we think about increases in in 'twenty five 'twenty six should we should we be thinking about it as.

Jonathan I'm going to speak to it first and Sam can certainly on color if necessary.

Is James did articulate in his prepared remarks. This does remain within our minimum distribution policy and so the increase in distribution. While we appreciate it was larger than most would have expected. It is coming with our growing <unk>. So after two consecutive years of the current year <unk> growth of 2023, coupled with what we're forecasting for 2024. This does remain in line.

Really <unk> growth for those years are a little bit above that.

I think going forward, Jonathan if youre willing to sort of normalize it a bit I would think yes. If you look at what you expected <unk> growth is that percentage would help influence that distribution increase.

Okay, Thanks, and congrats on the good quarter I will turn it back.

With a minimum distribution policy as taxable income is growing James did also mentioned our payout ratio for 2024 on our forecasted guidance range is expected to be.

Okay. Thank you.

Your next question comes from Kyle Stanley from the Jordan. Your line is now open.

Low to mid <unk>. So we're still staying within the same payout ratio and it is still a minimum distribution policy.

Thanks.

Everyone.

Good afternoon.

So just looking at the kind of the disclosure for <unk>.

Okay.

January so far the renewal rent increase in Alberta.

Okay go ahead Sir.

No go ahead Bruce.

With 95% I mean that is modestly ahead of the kind of top end of your 7% to 9% range target and it looks like at least given that charts.

I'm going to say, so so going forward when we think about increases in 'twenty five 'twenty six should we should we be thinking about it as well.

The fastest rent growth you've seen on renewal I'm. Just wondering is there anything that changes the seasonality is there anything specific or just kind of.

Really <unk> growth for those years are a little bit above that.

Yes, I think going forward, Jonathan if youre willing to sort of normalize it a bit I would think yes. If you look at what you expected <unk> growth is that percentage would help influence that distribution increase.

Something something that happened this January.

Hey, Kyle it's James.

By the way.

January specifically keep in mind.

Okay, Thanks, and congrats on the good quarter I will turn it back.

We have to look back in time for the past.

Thank you.

Probably a couple of years ago winter months, where generally when we saw some of the biggest incentives.

Your next question comes from Kyle Stanley from <unk>. Your line is now open.

In.

Our suites many.

Years ago, and so this was that opportunity now where we are eliminating those incentives and so you.

Thanks afternoon, everyone.

Good afternoon.

Temporarily saw a.

So just looking at the kind of the disclosure for January so far the renewal rent increase in Alberta was nine 5% and I mean that is.

<unk>.

Data point that was slightly above our range, we do anticipate going forward to remain within that 7% to 9% strategically moderated range.

Modestly ahead of the kind of top end of your 7% to 9% range target and it looks like at least given that chart.

Okay that makes sense and good point on the incentive burn off I guess, we're really seeing proof of it right there.

Kind of the fastest rent growth you've seen on renewal I'm. Just wondering is there anything that changes the seasonality is there anything specific or just kind of.

Okay.

One just on your kind of capital investment it looks like total capex was down about 3% year over year in 2023, I mean, how should we think about your expected spending for 2020, we're going to be similar type of decline or flat just curious there.

Something something that happened this January.

Hey, Kyle it's James.

By the way.

So January specifically keep in mind.

We have to look back in time for the past.

Yes call. It Lisa we do we do include our 2024 capital budget I looked in the MD&A. If you want to look for it overall you are correct. We did see a decline in capital spend in 2023 as compared to our budget. The largest driver for that decline came specifically from sweet capital and as we saw turnover go down as low as can appreciate.

A couple of years ago winter months, where generally when we saw some of the biggest incentives.

In.

Our suites, many years ago and so this was that opportunity now where we are eliminating those incentives and so you.

Temporarily saw a.

<unk>.

Data point that was slightly above our range, we do anticipate going forward to remain within that 7% to 9% strategically moderated range.

Pivoting our capital budget can be challenging so we saw that that capital free capital was going down and we did pivot to try to take on some of our bigger projects that we knew might be coming in future years as we saw that capital coming down we did start on those projects. Some of them are rolling forward a little bit into 2024, so you'll see that our 2024 capital budget is.

Okay that makes sense and good point on the the incentive burn off I guess, we're really seeing proof of it right there.

Okay.

Just on your kind of capital investment it looks like total capex was down about 3% year over year in 2023, I mean, how should we think about your expected spending for 2024.

<unk> equivalent to our 2023 capital budget, However, does contemplate an increase from our actual spend and so that's driven largely by recognizing we have a lower suite capital probably in 2024, and enabling us to do some of the bigger projects ESG focused project building envelope windows sub metering initiative.

Similar type of decline or flat just curious there.

Yeah call. It Lisa we do we do include our 2024 capital budget within the MD&A. If you want to look for it overall.

In our 2020 for capital budget.

Okay. Thanks for the clarification I should've looked a little harder.

Overall, you are correct, we did see a decline in capital spend in 2023 as compared to our budget. The largest driver for that decline came specifically from sweet capital and as we saw turnover go down as most can appreciate.

Just a last one.

Just a last one for me just on the the new supply environment in Alberta.

That gets talked about quite a bit I'm. Just wondering have you noticed any recent changes that would maybe be more supportive of increased development or maybe put another another way whats holding back new development development. Currently is at still high rate high construction costs or just whats.

What's your outlook with regards to new supply in Alberta for the year ahead.

Karl just looking at under construction right now in Alberta.

<unk> to our 2023 capital budget, However, does contemplate an increase from our actual spend and so that's driven largely by recognizing we have lower suite capital probably in 2024, and enabling us to do some of the bigger projects ESG focused projects building envelopes windows sub metering initiative.

Total housing units total housing units under construction in Calgary, and Edmonton, which is a slight increase from past months and quarters, which is a good thing because we are seeing some of the biggest population growth we've ever seen here in Alberta. So.

37000 homes under construction at two five transformation lets say thats for 100000 people.

2020 for capital budget.

Okay. Thanks for the clarification I should've looked a little harder.

Just a last one.

We're taking in 50000, a quarter right now and so we do need more housing here in Alberta, what's constraining that is exactly what you said.

Just the last one for me just on the new supply environment in Alberta.

And that gets talked about quite a bit I'm. Just wondering have you noticed any recent changes that would maybe be more supportive of increased development or maybe put another another way whats holding back new development development. Currently is at still high rates high construction costs or just whats.

Rates continued continue to be elevated construction costs continue to increase and so we as housing providers need to find a way to try to find more housing which is part of the reason why we are executing on our suite optimizations right. So we are effectively.

What's your outlook with regards to new supply in Alberta for the year ahead.

<unk> suites by converting administrative and storage spaces 1000 units and so it's small but we've accomplishable 40, so far we've got another 30 in the pipeline that's going to be about 70.

Karl just looking at under construction right now in Alberta.

Having 1000 total housing units total housing units under construction in Calgary to Amazon, which is a slight increase from past months and quarters, which is a good thing because we are seeing some of the biggest population growth we've ever seen here in Alberta and so.

You almost equivalent to the small acquisition, our small developments and so.

We as we continue to progress here, we have a lot of work to do as housing providers.

<unk> provide more housing for Albertsons and for Canadians and.

37000 homes under construction at two five times household formation, let's say that's for 100000 people.

Going forward the outlook for us looks good and we will try to create even more innovative ways to do so.

We're taking 50000 a quarter right now and so we do need more housing here in Alberta, What's constraining that is exactly what you said interest rates continued continue to be elevated construction cost continue to increase and so we as housing providers need to find a way to try to find more housing which is part of the reason why we are executing on our suite.

Okay perfect. That's it for me I'll turn it back thanks. Thanks.

Thanks Scott.

Your next question comes from Jamie Shen from RBC capital markets. Your line is now open.

Thanks.

Just a follow up on the construction comment.

<unk> right. So we are effectively.

<unk> Calgary office conversions.

Creating suites by converting administrative and storage spaces 1000 units and so it's small but we've accomplishable 40, so far we've got another 30 in the pipeline that's going to be about 70, that's almost equivalent to the small acquisition or a small development. So as we as we continue to progress here call. We have a lot of it.

Is that something you guys would look to participate in somehow.

And do you think they will ultimately have a meaningful impact on supply.

Thank you Jimmy at Sam We're big advocates.

Investment by all levels of government in our downtown cores as a whole and bring more housing in our downtown core here in Alberta and everywhere to be quite honest because it's.

Work to do as housing providers too.

I'll provide more housing for all burdens and for Canadians and <unk>.

Going forward the outlook for us looks good and we'll try to create more innovative ways to do so.

What we would call a no brainer for all levels of government to invest and preserve and keep our downtown cores healthy.

Okay perfect. That's it for me I'll turn it back thanks.

That being said.

Your next question comes from Jamie Shen from RBC capital markets. Your line is now open.

We're more advocates and involved we support the idea and believe it's a great one.

Thanks.

And have active discussions with office owners that are accessing grants.

A follow up on the construction comment down.

Downtown Calgary office conversions.

Is that something you guys would look to participate in somehow.

<unk> grants have to be used to make economic sense because of the conversions that are very expensive to complete.

And do you think they will ultimately have a meaningful impact on the supply there.

And so we believe that the grants are are a good investment because then it all.

Thank you Jimmy at Sam We're big advocates.

Investment by all levels of government in our downtown cores as a whole and bring more housing in our downtown core here in Alberta and everywhere to be quite honest because it's a.

Increased tax assessments and bring necessary affordable housing into the market more supply.

And we'll.

What we would call a no brainer for all levels of government to invest and preserve and keep our downtown cores healthy.

Preserve the significant investment in our downtown cores and infrastructure already.

And so going forward, we could be acquiring some of these developments because we're active in the design.

That being said.

We're more advocates and involved we support the idea and believe it's a great one.

The recommendations like the balcony et cetera required the type of floor plates.

And have active discussions with office owners that are accessing grants.

Because not all office.

Suitable for conversion.

<unk> grants have to be used to make economic sense because of the conversions that are very expensive to complete.

That all being said, it's very very difficult to see a lot of supply because it takes a lot of grants and capital and it takes a lot of time and it's very complicated to do.

And so we believe that the grants are are a good investment because then it all.

So the supply that we are seeing it's pretty small and going forward, we're not seeing much.

Increased tax assessments and bring necessary affordable housing into the market more supply.

More and the grants really need to pick up.

In order for the conversions to pick up in again.

And we'll.

Preserve the significant investment in our downtown cores and infrastructure already.

We believe it's a great investment for all levels of government and existing office owners to continue to.

And so going forward, we could be acquiring some of these developments because we're active in the design.

Explore and develop and we will continue to be advocates and maybe.

The recommendations like the balconies that are required.

Our buy some of these assets down the road, but thats not.

Type a.

Floor plates.

That we're not we're not active in any acquisitions of office conversions right now.

Because not all office is suitable for conversion.

That all being said, it's very very difficult to see a lot of supply because it takes a lot of grants and capital and it takes a lot of time and it's very complicated to do so if the supply that we are seeing is pretty small and going forward, we're not seeing much.

Alright got it.

The other question maybe.

Broad questions as well.

Things are going quite well today.

Sam you've seen many cycles, just curious as to what are the key things that you're keeping an eye on.

Anything that you could see that could potentially derail the growth that we're currently seeing.

More and the grants really need to pick up.

Thank you Jim Great question, our biggest experience over many many decades and we are in our 40 <unk> year now is affordability and affordability is a theme and a factor that we have.

The order for the conversions to pick up in again.

We believe it's a great investment for all levels of government and existing office owners to continue to.

Explore and develop and will.

Shared on our conference calls for many many years affordability is a big factor as to why we've seen such big migration and growth and movement into Alberta, and our core Saskatchewan markets as wells because homes are necessity and affordability is the greatest.

We'll continue to be advocates and maybe.

By some of these assets down the road, but thats not.

We're not we're not active in any acquisitions of office conversions right now.

And most significant indicator of future growth. The good news is we're still very affordable are occupied rents are about half of what.

Alright got it.

The question Wendy.

Broad questions as well.

Things are going quite well today.

Sam you've seen many cycles, just curious as to what are the key things that you're keeping an eye on.

Rents are in Vancouver, and Toronto and.

Anything that you could see that potentially derail the growth that we're currently seeing.

Our moderate win win win approach too.

Continue on providing affordability and exceptional results.

Thank you Jamie Great question, our Vegas experience over many many decades and we're in our 40 year now is affordability and affordability is a theme and a factor that we've.

Which is a win win for everyone.

Is what will keep our performance stable more predictable and sustainable and sustainable is a big key words and <unk>.

<unk> shared on our conference calls for many many years affordability is a big factor as to why we've seen such big migration and growth and movement into Alberta, and our core <unk>.

Resident focus our brand our reputation as the most important our resident members are our boss and so we're doing everything we can to continue providing affordable housing.

Catchment markets as wells because homes are a necessity and affordability.

C C.

The greatest.

C and everybody can agree.

And most significant indicator of future growth. The good news is we're still very affordable are occupied rents are about half of what.

There's always a shortage of affordable housing.

There is plenty of choices for housing for income levels that are high or.

Rents are in Vancouver, and Toronto.

Our purchasers with significant capital to purchase homes, what's always and our experience in short supplies of affordable housing and that's where our focus will always be.

Our moderate win win win approach too.

Continue on providing affordability and exceptional results.

Thank you Jimmy.

Which is a win win for everyone.

Sorry, if its a long answer sorry. Thanks.

Is what will keep our performance stable more predictable and sustainable and sustainable is a big key words and <unk>.

Your next question comes from Matt <unk> from National Bank. Your line is now open.

Hey, guys.

Just quickly going back to capital allocation on the back of that.

Resident focus our brand our reputation as the most important our resident members our boss and.

The equity offering that you guys did when.

When you look at acquiring assets do you have a preference in terms of the vintage.

And so we're doing everything we can to continue providing affordable housing.

We see and everybody can agree there's always a shortage of affordable housing.

Value.

New construction.

Some thoughts there.

Hey, Matt it's Jim.

I think for US we're looking to be opportunistic.

There is plenty of choices for housing for income levels that are high or or purchasers with significant capital to purchase homes.

So it really depends.

Currently what we're seeing and you've seen it with our most recent acquisitions, we've seen the opportunity in newer assets newer assets, where developers are looking to turn that capital and.

As always in our experience in short supplies of affordable housing and that's where our focus will always be.

We're able to pick up great communities that are high grading our portfolio and great locations that are <unk>.

Thank you Jimmy.

Sorry, if its a long answer sorry.

Spending on our clusters.

We're seeing some opportunities like that here going forward, but we're also starting to see some value add opportunities as well and so it really depends matter.

Ladies and gentlemen, as a reminder, should you have a question. Please press star followed by the number one.

As I had said earlier our team is working hard looking for the best deals and discuss opportunities for us to accretively deploy that capital that we have on our balance sheet.

Your next question comes from Matt <unk> from National Bank. Your line is now open.

Okay Fair enough and then.

Sorry go ahead.

Hey, guys.

The dish.

Just just quickly going back to capital allocation on the back of.

We ask our team to find the best acquisition and Theres only one best and Thats really what our focus is and being fussy on location.

The equity offering that you guys did.

When you look at acquiring asset do you have a preference in terms of the vintage valley.

Value.

And what we again shared with everyone Trophy locations are something that over 40 years, we've learned are counter cyclical.

New construction.

Some thoughts there.

Hey, Matt its James.

I think for US we're looking to be opportunistic.

And we have seen.

So it really depends.

Exceptional communities in our portfolio is that that are counter cyclical. So we believe we or anybody can't have enough communities that are countercyclical and thats really what were focusing on a qualitative expansion.

Currently what we're seeing and you've seen it with our most recent acquisitions, we are seeing the opportunity in newer assets newer assets, where developers are looking to turn that capital and we're able to pick up great communities that are high grading our portfolio and great locations that are expanding on our clusters.

Thanks James.

Trans Mountain.

Hey, guys.

We're seeing some opportunities like that here going forward, but we're also starting to see some value add opportunities as well and so it really depends matter like as I said earlier, our team is working hard looking for the best deals and the best opportunities for us to Accretively deploy that capital that we have on our balance sheet.

An extension of that.

James.

Alberta is hot right now, it's a great place to be.

But would you look to deploy capital outside of the province, and diversify I know, we've gone back and forth throughout the history of boardwalk on diversification or not but.

Okay Fair enough and then.

Thoughts on that.

Sorry go ahead.

At this juncture.

In addition.

Yes.

We ask our team to find the best acquisition and Theres only one best and Thats really what our focus is.

Looking at opportunities.

Within our targeted markets whole burrito, certainly is one of them.

We're also looking at new and Ontario, one of the Great features of new in Ontario is lack of price control.

And being fussy on location.

And what we again shared with everyone Trophy locations are something that over 40 years. We've learned are counter cyclical and we have seen.

In addition to that we do have a great operating platform in Ontario as loans. So we certainly are looking at markets outside of Alberta.

The biggest opportunity. However, we are seeing is the double digit NOI growth.

Sectional communities in our portfolio is that that are counter cyclical. So we believe we are anybody can't have enough communities that are counter cyclical and thats really what were focusing on a qualitative expansion.

Our performance and our results have shown.

The affordability of that Sam was speaking to in the longevity and runway that that we are anticipating here in Alberta with that high affordability that we have here today.

And then last one for me I didn't get a chance to go through it in detail yet and I know you disclosed the figure, but can you give us give a sense as to your thoughts on.

Trans Mountain.

I guess it is.

As an extension of that.

James.

Kind of what you are leaving on the table from a mark to market standpoint, and kind of how many years it would take to necessarily.

Alberta is hot right now, it's a great place to be.

But would you look to deploy capital outside of the province, and diversify I know we've done back in before throughout the history of boardwalk on diversification or not but.

The market rent growth that we've already seen to this point and then just looking forward the pace of market rent growth.

But thoughts on that.

At this juncture.

What are you seeing any stabilization in that or is it continuing to move.

Yes, Matt I mean, we're.

Looking at opportunities.

To move higher.

Within our target markets Alberto's, certainly is one of them.

Was there a specific market youre looking at.

We're also looking at new and Ontario, one of the Great features of new in Ontario is lack of price control.

I mean, let's stick to your core markets.

Edmonton and Calgary, I guess would be the most interesting color you could provide there.

In addition to we do have a great operating platform in Ontario, as well and so we.

And Alberta are mark to market right now is about $130.

We certainly are looking at markets outside of Alberta.

The biggest opportunity. However, we are seeing is the double digit NOI growth.

Keep in mind our <unk>.

Market rents move dynamically.

If you look back to past quarters, you probably would have seen a fairly consistent number but thats part of our approach and strategy as well as a moderated pace of adjustments on market rents and when combined with.

Our performance and our results have shown.

<unk> before the ability of that Sam was speaking to in the longevity and runway that that we are anticipating here in Alberta with that high affordability that we have here today.

The adjustments that we are seeing on our lease renewals and in place rents, we're seeing a fairly consistent mark to market and so.

And then last one for me I didn't get a chance to go through it in detail yet and I know you disclosed this figure, but can you give us give a sense as to your thoughts on.

We would anticipate Matt that going forward that mark to market spread in our in our Alberta market to remain within that reach call at around that $100 range.

Kind of what you are leaving on the table from a mark to market standpoint, and kind of how many years it would take to necessarily.

Okay.

Got it but the market rent growth that we've already seen to this point and then just looking forward the pace of market rent growth.

Yes.

Said differently.

Do you expect kind of similar.

Thanks dynamic persist at least for a couple of years in terms of new and renewal leasing spreads achieved again in Alberta. This year it seems.

Are you seeing any stabilization in that or is it continuing to come.

To move higher.

Sustainable for.

Was there a specific market youre looking at.

At least.

A few years.

I mean look.

Yes, I mean affordability is.

Thank you.

Your core market.

Nowhere better than in Calgary and Edmonton.

I had mentioned in Calgary, I guess would be the most interesting color.

Supply and demand dynamics continue to remain favorable and again when you pair that with our approach to moderating those adjustments, we do see a longer runway here.

There.

In Alberta, our Mark to markets right now is about $130.

Keep in mind, our market rents move dynamically.

Yes.

Thanks I appreciate it.

Yes, Matt.

If you look back to past quarters, you, probably would've seen a fairly consistent number but that's part of our approach and strategy as well as a moderated pace of adjustments on market rents and when combined with the.

There are no further questions at this time Mr. Cool, Yes. Please continue with your closing remarks.

Thank you Lester is always if there are any further questions or comments. Please do not hesitate to contact us with gratitude wed like to thank our extraordinary team loyal resident CMA sea or lenders or unit holders, especially for the support and our most recent offering and all of our stakeholders.

The adjustments that we are seeing on our lease renewals and in place rents, we're seeing a fairly consistent mark to market and so.

We would anticipate mantech going forward mark to market spread in our in our Alberta market to remain within that range call it around that $100 range.

Really is about our BFS are boardwalk family Forever, who.

Okay. So just I guess said differently.

Huge shoulders, we stand and as leaders we continue to do everything we can to support continued growth in extraordinary where and it cant. Thank our extraordinary team and great leaders enough, we especially remember our PFS with our former senior Vice President Bill Chipotle recently passing.

Do you expect kind of similar.

Dynamic persist at least for a couple of years in terms of new and renewal leasing spreads achieved again in Alberta This year.

That seems sustainable for.

At least.

Few years.

We are pleased with our improving results on a foundation of exceptional value service and experience. We continue to provide our resident members investors and all our stakeholders homes, where our heart is our heart is where our family and our families where <unk> always blips welcome home to love always.

Yes, I mean affordability is.

Nowhere better than in Calgary and Edmonton.

Apply in demand dynamics continue to remain favorable and again when you pair that with our approach to moderating those adjustments, we do see a longer runway here.

Thanks I appreciate it.

Okay.

Our future is family what can be more important when choosing where to call home.

There are no further questions at this time Mr. Cool, Yes. Please continue with your closing remarks.

Thank you again, everyone for joining us this morning and May we please remind everybody that July 8th and ninth is our Investor relations.

Thank you Lester is always if there are any further questions or comments. Please do not hesitate to contact us with gratitude, we'd like to thank our extraordinary team loyal resident CMA sea or lenders or unit holders, especially for the support and our most recent offering and all of our stakeholders. It really is about our <unk>.

40 year of riding the Bowl since 84 Investor Tour. Please Marcus on your calendars, we look forward to seeing everybody at our Investor Conference.

Our boardwalk family Forever, whose huge shoulders, we stand and as leaders. We continue to do everything we can to support continued growth in extraordinary where it can't thank our extraordinary team and great leaders enough.

Thank you again, God bless and now more than ever granted all piece.

Ladies and gentlemen, this concludes today's conference call. Thank you for joining you may now disconnect.

We especially remember our PFS with our former senior Vice President Bill Chipotle recently passing.

We are pleased with our improving results on a foundation of exceptional value service and experience. We continue to provide our resident members investors and all our stakeholders.

Home is where our heart is our heart is where our family and our families. We're love always blips.

Welcome home to level always our future is family what can be more important when choosing where to call home.

Thank you again, everyone for joining us this morning and May we pleased to remind everybody <unk> got July eight to nine is our investor relations.

40 year.

Riding the bowl since 84.

Investor Tour. Please Marcus on your calendars as we look forward to seeing everybody at our Investor Conference.

Thank you again, God bless and now more than ever granted all piece.

Ladies and gentlemen, this concludes today's conference call. Thank you for joining and you may now disconnect.

Q4 2023 Boardwalk Real Estate Investment Trust Earnings Call

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