Release Date: July 31, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
-
Morguard North American Residential Real Estate Investment Trust (MNARF) completed Q2 2025 with total assets of $4.5 billion, indicating a strong asset base.
-
The company repurchased approximately 1.2 million units under its NCIB at an average price of $17.25, reflecting a strategic use of capital.
-
Net Operating Income (NOI) increased by 4.1% compared to the previous year, showcasing operational growth.
-
The Funds from Operations (FFO) payout ratio was a conservative 40.3%, allowing for significant cash retention.
-
Average monthly rent in Canada increased by 5.3% to $1,821, reflecting the quality and demand for the Canadian portfolio.
-
Total assets decreased from $4.6 billion at the end of 2024, primarily due to a decrease in the US dollar exchange rate.
-
Net income for Q2 2025 was $30.1 million, a significant decrease from $50.6 million in 2024, mainly due to a $23.6 million fair value loss on class B LP units.
-
Interest expenses increased by $3.4 million compared to the previous year, driven by higher principal and interest rates.
-
Occupancy in Canada decreased to 95.2% from 98% in the previous year, due to increased competition from new and existing properties.
-
The US portfolio’s Average Monthly Rent (AMR) growth was modest at 0.1%, indicating limited rental growth in that market.
Q: What is the outlook for current taxes for the rest of the year and into next year? A: Chris Newman, CFO: We finalized a US cost segregation study that allowed us to take additional depreciation and preserve our net operating losses (NOLs). We have about $40 million of NOLs, which gives us some runway before being fully exposed to current tax. For the rest of the year, we are sheltered from significant current tax and will continue using our NOLs.
Q: How did the Average Monthly Rent (AMR) in the US break down between new leases and renewals, and are there differences between the Sun Belt and the rest of the portfolio? A: John Flanno, Senior Vice President: The AMR is choppy and depends on individual properties and markets. We are effectively full in the US and are pushing rents, aiming for 3-5% increases. The gains are relatively flat, and we are still behind our peak rent levels.
Q: What is the current strategy regarding acquisitions, particularly in the US versus Canada? A: Paul Muello, Executive Vice President: We are focusing more on Canada due to the uncertain macro picture, although the US remains a core part of our portfolio. We are seeing more deal flow in Canada and are actively looking at opportunities there.
