BOARDWALK REAL ESTATE INVESTMENT TR (TSX:BEI) reported first-quarter financial results on Wednesday. The transcript from the company’s first-quarter earnings call has been provided below.
This content is powered by Benzinga APIs. For comprehensive financial data and transcripts, visit https://www.benzinga.com/apis/.
The full earnings call is available at https://app.webinar.net/oNbLVRQzWME
Summary
BOARDWALK REAL ESTATE INVESTMENT TR reported an increase in same property rental revenue by 2.8% and net operating income by 6.8% year-over-year, with an operating margin increase of 230 basis points to 65.8%.
The company continues to focus on providing affordable housing and has invested over $1 billion since 2017 in rebranding and repositioning efforts to enhance product quality.
The company announced a revision in its 2026 guidance due to anticipated property tax increases, projecting same property NOI growth between 1-3.5% and FFO per unit between $4.60 and $4.80.
Despite increased competition in higher-end rental markets, the company maintains a high occupancy rate of 97.1% and has reduced leasing incentives to sustain rental revenue.
The company has been active in asset sales, deploying $102 million under its NCIB program and plans further investment to capitalize on its undervalued portfolio.
Management highlighted strong performance in Alberta and Saskatchewan regions, with plans to continue its strategic repositioning and capital allocation initiatives.
Full Transcript
OPERATOR
Ladies and gentlemen, and welcome to the Boardwalk Real Estate Investment Trust first quarter 2026 earnings conference call. At this time all lines are in listening mode and we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, May 6, 2026. I would now like to turn the conference call over to Mr. Eric Bowers, VP, Finance and Investor Relations. Please go ahead.
Eric Bowers (VP, Finance and Investor Relations)
Thank you Kelsey, and welcome to the Boardwalk Real Estate Investment Trust 2026 First Quarter Results Conference Call. With me here today are Sam Colias, Chief Executive James Ha, President, Greg Tinling, Chief Financial Officer Samantha Coleus Gunn, Senior VP of Corporate Development and Governance and Samantha Adams, Senior VP of Investments. 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, Inuit and Metis peoples. Before we get to our results, please note that this call is being broadly distributed by way of webcast. If you have not already done so, please visit boardwalkreit.com investors where you will find a link to today’s presentation as well as PDF files of the trust financial statements, MDA and quarterly report starting on slide 2. We would 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, Boardwalk’s future operation and its actual performance may differ materially from those in any forward looking statements. Additional information that could cause actual results to differ materially from these statements are detailed in Boardwalk’s publicly filed documents. I would like to now turn the call over to Sam Colias.
Sam Colias (Chief Executive Officer)
Thank you Eric. Starting on slide 4. Welcome everyone to our Boardwalk Family Forever and to our Q1 2026 results. Redefining BFF Boardwalk family forever is at the top of our organizational chart. Family is everything. Affordable multifamily communities have always been an essential product and service. Together with our residents, our associates, investors, partners, capital environment, community, we are all essential and interconnected family members. With our true north where love always lives. Together we go far. Our leaders put our team first and our team puts our resident members first. Guided by the Golden Rule, we have a peak performing customer service culture that creates exceptional results as we can see on our next slide 5 our continued solid performance with GAAP and non GAAP measures increasing from the same quarter last year, same property rental revenue increased 2.8% and same property net operating income increased 6.8%. Our operating margin increased by 230 basis points to 65.8% as well as our funds from operation per unit increasing by 8.5%. Profit is down as a result of a non cash reduction in our IFRS net asset value. Our net asset value per unit at $95.93 representing exceptional value in our current unit price that is trading well below this. I would like to now pass it over to Samantha Colias Gunn.
Samantha Colias Gunn
Thank you so much Sam. We are extremely grateful for our team, our Boardwalk families, perseverance, performance and continued commitment to our purpose bringing our resident family members home to ‘Love Always’. Continuing on to slide 6 our operational stability and commitment to affordable housing rental market fundamentals in our core markets are more competitive demand continues for more affordable housing despite supply deliveries focused on higher end luxury products to justify high construction costs. We are grateful for our partnership with CMHC and our Federal government that have implemented effective public policy to build more supply that has resulted in a balancing of the rental market across Canada providing more affordability to all Canadians. We are well positioned to deliver on our commitment to provide much needed affordable housing and in a more competitive environment. With our experienced peak performing team, exceptional product quality with over $1 billion invested since 2017 in rebrand and repositioning efforts and dedication to our Boardwalk family as responsible community providers. Our self regulation provides us with continued steady results as we remain flexible with our rental rates producing greater stability in occupancy margins, NOI and reputation paired with our strong financial foundation, minimum distribution policy resulting in maximum reinvestment and free cash flow growth, strategic repositioning, unparalleled customer service and on our foundation of strong family values, we remain in a position to deliver solid performance. This is what sets us apart. Bringing you home to where love always lives. Boardwalk strives to be the first choice in multifamily apartment communities to work, invest and call home with our Boardwalk family forever. Moving on to Slide 7, our strategic rebranding enhances our resident member experience exceptional quality at an affordable price keeping our occupancy high at 97.1% according to Rentals.ca data. Our average occupied rents of $1,601 for a two bedroom apartment are attractive especially relative to the Canadian average of $2,197. Moving on to slide 8 Alberta continues to see positive population growth with small relative amounts of non permanent residents. Affordability continues to drive positive population and leading economic growth in our core markets, Alberta and Saskatchewan. Reflected in our Appendix. Quebec has delivered exceptional results despite negative population growth. Further evidencing the strong demand for affordable housing, Ontario remains stable. We are strategically in all the right places at the right time. Please refer to our Appendix for more data on the resilience of the Alberta economy and the renewed Alberta advantage. We would like to now pass the call on to Greg Tinling who will provide us with an overview of our quarter results, Strong balance sheet, Fair value
Greg Tinling (Chief Financial Officer)
and ESG thank you Samantha Beginning on slide 9, occupancy remains strong as we enter the spring and early summer season supported by continued growth in occupied rent. While vacancy loss increased, the trust effectively reduced leasing incentives which contributed to the higher rental revenue reported in Q1 2026 compared to the same period last year. These results reflect the success of our strategic initiatives aimed at maximizing free cash flow and diversifying our product offering, delivering meaningful financial performance. Slide 10 provides an overview of leasing spreads for new and renewed leases under our self regulated resident friendly centric model. This approach continues to drive strong retention and referrals while keeping turnover and operating expenses low on a year over year basis. Leasing spreads have moderated reflecting a more balanced supply demand environment. Increased supply in select portfolio markets, particularly at the higher price points, has led to greater competition and vacancy on a blended basis. Leasing spreads have gradually improved since the start of the year reflecting effective resident engagement and retention strategies in a more competitive market. Our strategic flexibility with new rental rates enabled us to preserve high occupancy while maintaining solid operating margins and net operating income. We remain focused on maintaining high occupancy and maximizing resident retention. This strategy reinforces our commitment to provide affordable resident friendly housing in our core markets while also reducing costs and steadying operational performance, delivering long term value for all stakeholders. Slide 11 shows sequential quarterly rental revenue growth including a 0.4% decline in Q1 2026 compared to Q4 2025 with increased competition and a return to seasonality in the winter months. Boardwalk focused on managing occupancy and positioning ourselves favorably for the spring early summer season. Turning to Slide 12, same property net operating income increased by 6.8% in Q1 2026 compared to the same quarter last year with revenue growth of 2.8%. Alberta, the trust’s largest region, contributed meaningfully to this performance with a 7.3% increase in net operating income with revenue growth of 2.3% total rental expenses declined by 4.1% year over year, primarily due to lower utility costs with the removal of the federal carbon tax alongside lower insurance premiums. Slide 13 outlines Boardwalk’s mortgage maturity schedule. The Trust debt portfolio is well staggered with approximately 96% of the mortgage balance carrying NHA insurance through the Canada Mortgage and Housing Corporation. This insurance remains in place for the full amortization period and backed by the Government of Canada, enables access to financing at rates below conventional mortgage levels with A current estimated 5 year and 10 year CMHC rate of 3.9 and 4.3 respectively. Although current interest rates are above the Trust’s maturing rates over the next few years, the Trust’s maturity curve remains staggered, reducing the renewal amount in any particular year. Lastly, the Trust has an interest coverage of 3.04 in the current quarter to date in 2026 of the $823 million of 2026 mortgages maturing, we have renewed or forward locked $346 million at an average rate of 3.75% and an average term of approximately 7 years. Combined with our cash on hand as well as our unused credit facilities, we are well positioned with strong liquidity available. Current underwriting criteria in our most recent submissions to CMHC and our lenders has remained in line with our historically conservative estimates. Please Refer to slide 48, which summarizes our 2026 mortgage program completed slide 14 illustrates the trust’s estimated fair value of its investment properties, excluding adjustments for IFRS. 16 as at March 31, 2026, the fair value of investment properties totaled $8.6 billion compared to $8.7 billion as of December 31, 2025. The decrease in overall fair value is the result of an increase in cap rates and a decrease in market rents in Calgary, reflecting elevated risk from incoming supply and competitive pressure on market rents at the higher market level, as well as adjusting quality classifications in Ontario for certain assets based on comparable transactions, along with an update upward adjustment for vacancy assumptions in select markets. These adjustments were partially offset by higher market rents, most notably in Grand Prairie, Fort McMurray, Regina and Saskatoon. Current estimated fair value of approximately $245,000 per apartment door remains below replacement cost, 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, and consult with our external appraisers. Most recent published cap rate reports suggest that the cap rates being utilized by the Trust for calculating fair value are within their estimated ranges. Slide 15 highlights our ESG Initiatives we would like to highlight our 2025 GRESB score of 72 which represents a 7.5% increase compared to the prior year. Using a disciplined capital allocation approach, we are focused on reducing emissions through reduced utilities consumption and therefore reducing utilities costs while always promoting social and governance initiatives. As part of our 2025 annual reporting, the Trust will be publishing its ESG report in May 2026 which will be available on our website. I would like to now turn the call over to Samantha Adams to highlight our capital allocation initiatives.
Samantha Adams (Senior VP of Investments)
Thank you Greg Following a transformational 2025 during which Boardwalk completed $829 million of transactions, we have entered 2025 focused on disciplined capital allocation, maximizing free cash flow and directing capital to the best risk adjusted opportunities. We are …
This post was originally published here
