2019 has been extremely busy, thus far, and we are thrilled to share many exciting updates. The Q&A with Centurion President and CEO Greg Romundt in the last issue was received positively so we decided to bring it back. We also feature his two-part BNN Bloomberg interview with
Andrew McCreath
.
This issue also includes some information about the appointment of Mr. Stephen Sender as a crossover trustee for both boards of Centurion Apartment REIT and Centurion REOT. Under Property News, Centurion Apartment REIT has been very busy with a total of 12 completed and pending acquisitions since May 2019. Finally, we have some important announcements and the latest updates about Centurion's three funds.
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The Annual General Meetings (AGMs) of Centurion Apartment Real Estate Investment Trust, Centurion Real Estate Opportunities Trust, and Centurion Financial Trust will be held at the
Delta Toronto East
(2035 Kennedy Road, Scarborough, Ontario)
on Tuesday, September 17, 2019 at 10:00 a.m.
All unitholders were mailed an AGM package outlining the agenda. Unitholders who are unable to attend the Meeting are requested to submit a proxy in favor of a representative. All proxies should be properly executed and deposited using the postage-paid envelope provided.
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Q&A with Centurion President
and CEO Greg Romundt (PART 2)
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The last 10 months have been very busy for Centurion. Since November 2018. We have completed the acquisition of two multi-residential apartment properties in the United States, one in Alberta, eight in British Columbia, two in Manitoba, and three in Saskatchewan. In addition, we currently have several pending acquisitions in Alberta and British Columbia, which we expect to close in the coming months.
Our team has compiled the "most asked" questions in this issue and requested Centurion Founder and CEO Greg Romundt to answer them.
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Board of Trustees Appointments for
Centurion Apartment REIT and Centurion REOT
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Centurion Asset Management Inc. is pleased to announce that Stephen Leslie Sender has been appointed to the Boards of Centurion Apartment REIT and Centurion REOT as a trustee. As the only independent trustee on both Boards, Mr. Sender will also be the crossover independent board member between the two trusts. He will stand for reappointment at the Annual General Meeting of Unitholders that will be held on September 17, 2019.
Mr. Sender is a trustee of H&R Real Estate Investment Trust and a Director of Sienna Senior Living Inc. He served as an investment banker for over 30 years in Canada and abroad and was managing Director, Industry Head – Real estate in Scotiabank’s Global Banking and Markets Division, representing the bank’s capital market activities in the Canadian real estate industry. Since the early 1990’s, Mr. Sender specialized in the Canadian real estate sector, providing investment banking advice to numerous public entities with respect to capital market activities. He has been directly involved in raising equity and debt capital in many transactions and has provided financial advice in numerous large transactions including mergers, takeovers, and related party transactions. Mr. Sender has been a frequent moderator/speaker at conferences in Canada and is a part-time instructor at York University, Schulich School of Business. He holds a B.Comm. (Honors) degree from the university of Cape Town and qualified as a C.A. (S.A) in 1984.
Centurion President and CEO Greg Romundt commented,
“We are very excited about Stephen’s appointment and trust that he will be able to make significant contributions to both Boards. We look forward to his strategic guidance and support.”
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Enhancing the Boards of
Centurion Apartment REIT and Centurion REOT
by: Greg Romundt
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We have already announced that Stephen Sender has joined the boards of the REIT and REOT to fill the vacant seat we had for the crossover board member. In the process of our search, we came across numerous high-quality candidates. We have always seen trustees as performing numerous functions for their boards and Centurion. Not only do trustees provide governance and oversight, they also provide strategic advice and open business opportunities for the trusts due to their extensive networks in the industry.
I have always tried to build the boards that serve our funds with the view that each member brings a particular strength, if not many strengths to the board, such that the board has a breadth of experience as no one person is strong in every area. Further, I’ve always sought board members with industry specific experience (e.g., real estate) as opposed to broad industry experience (e.g., automotive, manufacturing, oil and gas), which may have little relevance to our business.
All Centurion boards have, at their core, the requirement that the majority of the board members be independent of management. The board of the REIT has always been five trustees, three of which were external, independent trustees and two were internal management members. The REIT has grown tremendously since we launched ten years ago, with assets now around $2.2 billion. REOT and CFIT both have 7-member boards.
As the REIT board went through the process of finding a replacement trustee, it seemed like the right time to expand the board to seven members and to make it even more independent than before. As such, in addition to Stephen Sender joining the REIT, the board has proposed adding Andrew Jones, Paula Gasparro and Laetitia Pacaud as independents at the Annual General Meeting of Unitholders scheduled for September 17.
Robert Orr, Centurion's CFO and Chief Compliance Officer has sat as one of the internal trustees for a number of years and will, as of the AGM, step down as a trustee but remain in his operating roles to make room for the new trustees. He will, in his roles as CFO and CCO, continue to attend meetings and to report to the board as before. The REIT board, post the AGM, will thus have seven members, of which six will be independent of management. We see this as significantly strengthening the board in terms of independence but also the range of skills at the table.
We have a similar plan for the REOT. In addition to Stephen Sender joining as the crossover board member between the REIT and REOT, we are proposing that Chris Humeniuk join the board at the AGM. Chris will be replacing Charles Dillingham who has served on the board since REOT was founded in 2014 and we thank him for his service. Robert Orr will continue as a REOT board member until such time as we can find another high-quality candidate. The plan is to take the REOT board from seven members, of whom four are currently independent and three are management members, to five independents and two management members (Greg Romundt and Stephen Stewart).
Post the AGM, it is planned that the REIT and REOT will review board member compensation and structure as this hasn’t been done in a number of years and we want to ensure that compensation for independent trustees is commensurate, competitive, and appropriately structured in line with current best practices. Management board members receive no additional compensation for their roles on the boards, and this is not proposed to change.
Prior to these proposed changes, between all of the three boards, there were nine independent trustees and four management trustees. After these proposed changes, there will be 13 independent trustees and three management trustees, meaning that we will be adding a net four new board members and their skills and network for the benefit of the funds and investors. We are very pleased to have attracted such a strong slate of candidates for the boards and are excited to be further enhancing the depth of the pool of talent around the board table and making them even more independent.
Click
here
to view the biographies for these proposed members.
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Centurion is very excited to welcome you to our new Toronto head office! As the company continues to grow, this space was designed to support current and future needs that will allow us to provide excellent services to clients and advisors.
Please update your records with our new address.
All of our other contact information remains the same.
25 Sheppard Avenue West, Suite 1800
Toronto, ON M2N 6S6
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A Busy Quarter for Centurion Apartment REIT
Centurion Asset Management Inc., the asset manager of Centurion Apartment REIT, has closed the acquisition of 11 multi-residential properties in Manitoba, Alberta, and British Columbia since May 2019. These acquisitions brings Centurion's portfolio to 68 properties and 8,156 undiluted rental units in 23 cities across Canada and the United States as at August 31, 2019.
- Three newly constructed properties in Langford and Victoria, British Columbia. Located minutes to downtown Victoria, V488 and Verve have 229 modern residential units. Similarly, the 90-unit Danbrook One is in downtown Langford, offering contemporary urban living. All three buildings feature condo-quality finishes and multi-level parking. The properties are conveniently situated steps to everyday shopping and dining experiences, public transportation, and supermarkets. Centurion has acquired a 50% interest in V1488 and 100% interest in Verve and Danbrook One.
- An apartment portfolio in Langford, British Columbia. Hockley Apartments has a total of 136 residential units and two commercial units across five buildings. Located in Downtown Langford, the properties are accessible by public transit with direct bus routes to downtown Victoria. Centurion has acquired a 100% interest in these properties.
- An 11-storey apartment building in downtown Edmonton. Beacon Place has 82 residential units with modern finishes and features surface or covered parking options. The property is conveniently located close to the City’s Government District, Business District, and numerous restaurants, and retail shops. Centurion has acquired a 100% interest in this property.
- Two new luxury apartment complexes in southwest Winnipeg. The 416-suite Summit at Seasons and 176-suite Pinnacle at Bridgwater have state-of-the-art amenities that complement modern living spaces. Both properties feature a clubhouse with fitness facilities, resident lounge, and café-like study room. Centurion has acquired a 50% interest in Summit at Seasons and a 45% interest in Pinnacle at Bridgwater.
In addition to these completed acquisitions, Centurion also announced the pending acquisition of another multi-residential property in British Columbia. See below for the map of these properties or click the photos to
view the announcements.
"These acquisitions represent Centurion's expansion into the growing rental markets in Western and Central Canada," said Lucian Ionescu, Centurion's Executive Vice President for Residential Operations.
"Our Operations team is very excited to apply our property management expertise to elevate resident experience in these new Centurion communities."
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Real Estate Investment with Centurion founder Greg Romundt on BNN Bloomberg's Weekly with Andrew McCreath
Centurion President and CEO Greg Romundt speaks with BNN's Andrew McCreath about Centurion and his outlook on real estate investments in Canada. In this two-part interview, Greg spoke about Centurion Apartment REIT's fund profile and provided an in-depth analysis of the fund’s performance last year.
Click
here
to view the interviews.
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Cooking with Centurion President and CEO Greg Romundt
Watch Centurion President and CEO Greg Romundt talk about Centurion, his personal experiences, and love for food as Rana Florida puts Greg's cooking skills to a test in this inaugural episode of
Cooking with...
Click
here
to see Greg and Rana cook
Spaghetti with Homemade Tomato Sauce.
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Temporary Capping of Centurion Apartment Real Estate Investment Trust (the "REIT") and Centurion
Real Estate Opportunities Trust (the "REOT")
Centurion Apartment REIT and Centurion REOT have temporarily capped new subscriptions as of July 4, 2019 and August 1, 2019, respectively. Both Trusts remain open for redemptions and continue to make scheduled cash and dividend distributions.
Centurion Apartment REIT and Centurion REOT
will continue to search for accretive investment opportunities and hopes to re-open to new subscriptions after existing capital has been deployed. Existing and potential investors wishing to subscribe to the REIT and/or the REOT should indicate their interest to their advisors or to Centurion so that Centurion may give notice to interested parties at the earliest availability of any new capacity.
Centurion Apartment REIT and Centurion REOT
will provide updates on available capacity as it becomes available.
Centurion Financial Trust remain open for investment.
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Move to Quarterly Reporting
We have decided to publish quarterly financial statements including a short management discussion and analysis for each fund to compliment our other quarterly reporting and regular website updates. We believe this change will meet the growing due diligence demands of our investors and their advisors.
These reports will provide further and more frequent in-depth insight into our fund performance. This is the first newsletter that includes these reports and they will also be published to the website for easy access. This is our initial iteration of this process and we hope to continue to enhance it over time.
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FUND OVERVIEW
Centurion Apartment Real Estate Investment Trust ("REIT")
- The REIT NAV as at September 3, 2019, is $16.872, which represents a unit price appreciation of 4.48% since the start of 2019.
- The REIT's year-to-date return for 2019 was 8.06% on its Class A Units and 8.55% on its Class F Units.
- The REIT's trailing 12-month return for 2019 was 19.88% on its Class A Units and 20.71% on its Class F Units.
- The current annualized distribution yield for reinvested Class A Units is 5.07% and 5.77% for Class F Units.
- The REIT has acquired 10 multi-residential properties in British Columbia, Alberta, and Manitoba; and has two (2) multi-residential properties under contract in British Columbia.
- Rent-to-market-rent gap is 14.5% as at June 30, 2019, compared to 13.7% as at December 31, 2018.
Centurion Real Estate Opportunities Trust ("REOT")
- The REOT NAV as at September 3, 2019, is $ 11.702, which represents a unit price appreciation of 1.06% since the start of 2019.
- The REOT's year-to-date return for 2019 is 5.27% on its Class A Units and 5.89% on its Class F Units.
- The REOT's trailing 12-month return for 2019 was 7.64% on its Class A Units and 8.59% on its Class F Units.
- The current annualized distribution yield for reinvested Class A Units is 6.28% and 7.20% for Class F Units.
- REOT is enjoying exceptional deal flow and has several hundred million in loan term sheets out for consideration.
Centurion Financial Trust ("CFIT")
- The CFIT NAV as at September 3, 2019, is $ 10.264, which represents a unit price depreciation of 0.90% since the start of 2019.
- CFIT's year-to-date return for 2019 is 3.76% on its Class A Units and 4.44% on its Class F Units.
- CFIT's trailing 12-month return for 2019 was 6.84% on its Class A Units and 7.88% on its Class F Units.
- The current annualized distribution yield for reinvested Class A Units is 7.19% and 8.25% for Class F Units.
- The portfolio is split as at June 30, 2019, between its investment in real estate debt or mortgages (62%) and investments in non-real estate, corporate private debt (38%).
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For investor management inquiries, please contact or Investor Administration team:
Toll-Free: 1-833-733-5617
Tel: 416-733-5617
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