W&F Issue 3 2018

www.wealthandfinance-news.com 8 Wealth & Finance International - Issue 3 - 2018 Planning is currently underway for the development of a 40-storey mixed-use commercial and residential building located near the corner of Portage Avenue and Main Street in Winnipeg, Manitoba. Interestingly, this particular densification project is located adjacent to one of Artis’ office towers, and the REIT’s head office. The company continues to add to its remarkable collection of real estate. Artis owns a 12-acre parcel of land in Winnipeg, Manitoba; Linden Ridge Shopping Centre II, located adjacent to Linden Ridge Shopping Centre, another Artis-owned retail asset. Lowe’s is leasing nine acres of the land at the site pursuant to a land lease which commenced in 2017. Excitingly, Artis has the potential to build an additional 30,000 square foot building on the remaining three acres of land. Broadening its presence throughout Canada, the company is now exploring opportunities for another densification project, at 415 Yonge Street in Toronto, Ontario. Artis management sees this as a prime location to build approximately 400 apartment units above the 19-storey office building owned by Artis and plans are already underway. The location is seen as ideal as it is across from the College Station subway stop and is in close proximity to the University of Toronto and Ryerson University, making it an appealing hub for students. While these development plans are preliminary at this time, this potential densification opportunity is anticipated to provide a platform for further success from the company. In an effort to boost its presence throughout the region, Artis is similarly exploring opportunities for a densification project at Concorde Corporate Centre, also in the Greater Toronto Area, Ontario. The site provides direct access to Don Valley Parkway and convenient access to other major thoroughfares. Preliminary plans are underway to build 500 apartment units on the site. Again, these preliminary plans may change, but Artis has exciting plans to develop at this site. Additionally, there are development plans underway to rezone Stampede Station II on Macleod Trail in Calgary, Alberta, from the current 300,000 square foot office project to a 30-storey multi-family project with 300 suites. With these developments and others in the pipeline, Artis has big plans for its portfolio in both Canada and the United States and Wealth and Finance looks forward to seeing what the future holds. Artis strives to steadily improve its key financial metrics and effectively manage its assets, as well as improve the overall quality of its portfolio through capital recycling initiatives, redevelopment and new development projects. In order to adapt accordingly, last year, Artis made considerable improvements to its financial metrics. In 2017, the company completed 1.2 million square feet of new lease transactions and 2.4 million square feet of lease renewal transactions. The weighted-average increase on renewal rents achieved was 4.9% excluding Calgary office renewals (2.3% including Calgary office renewals). With the company always aiming to improve, the Artis leasing team continues to work diligently on its 2018 leasing program. As of December 31, 2017, 32.7% of 2018 lease expiries had been either renewed or committed to new tenants. In 2017, the company acquired four industrial properties, the remaining 10% interest in three phases of an industrial development project and a parkade for aggregate purchase prices of CAD13.9 million and USD69.1 million. Artis also disposed of 23 non-core assets in both Canada and the United States for aggregate sale prices of CAD353.1 million and USD70.6 million. Of these 23 dispositions, 11 properties were located in Alberta, five of which were Calgary office assets. Artis also made substantial progress on its new development and redevelopment projects. Most notably, the REIT completed the development of 175 Westcreek Boulevard, Park Lucero Phases II and III, Park 8Ninety Phase I and the Millwright Building. 175 Westcreek Boulevard and Park Lucero Phase III were fully leased upon completion and provide an excellent illustration of the value that can be created from strategic development projects. In December, the company announced that a long-term lease had been negotiated for 131,796 square feet at Park Lucero II, marking the fifth fully-leased building at Park Lucero, and leaving only one slab-ready pad for future development. In 2017, Artis invested CAD83.5 million in its (re)development projects. Corporate sustainability is a high priority for Artis. The company is committed to improving the energy efficiency of its properties and reducing its environmental footprint. As of December 31, 2017, Artis possesses 19 properties with a LEED certification, 18 properties with a Building Owners and Managers Association (BOMA) Building Environmental Standards (BEST) certification and 19 properties with an Energy Star certification. Ultimately, the team at Artis will continue to conduct an ongoing review of its current assets in order to identify opportunities to maximise value from assets that are aligned with the company’s long-term strategy. By identifying and disposing of non-core assets, Artis is able to take advantage of strategic opportunities to recycle capital, thus improving the overall quality and diversity of the portfolio. Artis is pleased to demonstrate to unitholders its ability to produce results that are reflective of the focus and dedication of its experienced management team, strong earnings, a healthy balance sheet and significant cash liquidity. With these and other valuable resources, the REIT is well positioned for another successful year and will continue to strive to deliver strong results for unitholders. “Corporate sustainability is a high priority for Artis. The company is committed to improving the energy efficiency of its properties and reducing its environmental footprint.”