Killam Apartment REIT revealed $88 million in new acquisitions, including $82.1 million in newly constructed apartments and $5.7 million in land to expand its development pipeline. The acquisitions include properties in Calgary, Ottawa, Charlottetown and Waterloo.
“We are pleased to announce our recently completed acquisitions,” noted Philip Fraser, President and CEO. “We are increasing our presence in Ontario and Alberta as accretive opportunities arise, with 78% of our 2018 acquisitions outside of Atlantic Canada. We also continue to complement our established portfolio in Atlantic Canada with select high-quality properties. We are thrilled to have recently expanded our portfolio in the extremely strong Charlottetown market with the acquisition of the Harley Street Apartments.”
“It’s been a busy year of acquisition growth for Killam and year-to-date, we have acquired $263 million of assets, making 2018 the largest acquisition year in Killam’s history. We continue to look for opportunities in the fourth quarter of 2018 to grow the portfolio and diversify geographically.”
On October 1, 2018, Killam purchased the Treo at Sherwood, two new four-storey, wood-frame apartment buildings located in Calgary’s Sherwood neighbourhood. The fully-occupied, 158-unit property was acquired for a purchase price of $39.0 million ($247,000 per unit), representing an all-cash yield of 4.9%. The property is located adjacent to Killam’s recently announced 10% interest in the 13.6-acre Nolan Hill development.
Killam purchased 151 Greenbank Road, a new five-storey, concrete apartment building located in Ottawa, Ontario. The 60-unit property was acquired on September 26, 2018, for a purchase price of $20.7 million ($345,000/unit), representing a stabilized all-cash yield of 4.6%. In its initial lease-up, the property is currently 88% leased. The average rental rate is $1,729 ($2.24 per sf). 151 Greenbank Road has condo-quality finishes, including granite countertops, underground parking, and modern building amenities, including a common room and fitness room.
On August 14, 2018, Killam purchased a newly constructed four-building complex containing 107 units in Charlottetown, PE. The property, known as the Harley Street Apartments, was purchased for $22.4 million ($209,000/unit), representing an all-cash yield of 5.6%. The average monthly rent is $1,505 and the property is 100% occupied. The buildings include underground parking, a unique feature in the Charlottetown market.
In addition, Killam purchased a 1.9 acre development site in downtown Charlottetown on the waterfront for $2.2 million. The site is located on Haviland Street and is zoned for 99 units. Killam also purchased a 1.2 acre development site in Stratford for $1.2 million. The site is zoned for 79 units and is located on the waterfront overlooking downtown Charlottetown.
Waterloo Development Opportunity Expanded
Killam has increased its multi-family development potential in Waterloo with the acquisition of a site adjacent to Westmount Place (acquired in March 2018). This acquisition is expected to allow for greater density and flexibility with Killam’s future multi-phase residential Westmount Development. Killam purchased an additional 16,500 sf development site on Erb Street for $2.3 million, expanding the area of the Westmount residential development opportunity by 0.38 acres to 2.4 acres. This also increases the overall development opportunity to approximately 800 units.
Killam Apartment REIT, based in Halifax, Nova Scotia, is one of Canada’s largest residential landlords, owning, operating and developing a $2.7 billion portfolio of apartments and manufactured home communities. Killam’s strategy to enhance value and profitability focuses on three priorities: 1) increasing earnings from existing operations, 2) expanding the portfolio and diversifying geographically through accretive acquisitions, with an emphasis on newer properties, and 3) developing high-quality properties in its core markets.