Boardwalk REIT revenue down, profit up in 2017

Company saw 2017 as an opportunity to work on ‘suite renovations, brand diversification and community repositioning,’ and is now trimming vacancy rates

Monthly Rental Revenue (CNW Group/Boardwalk Real Estate Investment Trust)

Mario ToneguzziCalgary-based Boardwalk REIT experienced a slip in total revenue in 2017 but saw its profit rise, the company said while reporting its financial results on Monday.

The occupancy rate for its properties increased as well.

Boardwalk said total revenue for last year of $422.9 million was down 3.6 per cent from the year before and net operating income dropped by 14.6 per cent to $216.1 million. However, profit of $57.3 million was up 199.7 per cent over 2016.

Funds from operations declined by 25.9 per cent to $107 million.

At the end of the year, the company had 32,282 rental units. Its occupancy rate of 95.7 per cent to begin 2018 was up from 93.78 per cent a year ago.

Sam Kolias

According to Sam Kolias, chairman and chief executive officer of Boardwalk REIT, “2017 was a transitional year for Boardwalk, as a bottoming in our core markets allowed us to take advantage of historically high market vacancy rates to further enhance our product quality and service by investing in suite renovations, brand diversification and community repositioning.

“This investment initially exacerbated our vacancy loss as many suites were undergoing renovation, however the refinement of our renovation production process towards the latter part of 2017 allowed the Trust to complete the majority of these suites in the last six months of 2017,” said Kolias.

“The full absorption of these renovated units in the fourth quarter and January of 2018 has resulted in a significant improvement in overall occupancy and reflects the positive long-term benefit that outweighs the short-term sacrifice in higher vacancy,” he said.

“We are increasingly optimistic as we enter 2018. To begin recapturing significant revenues, Boardwalk’s focus in early 2018 is on occupancy. Our team has already exceeded our year-end goal of 95 per cent occupancy, and are ahead of schedule for accomplishing a further goal of 97 per cent occupancy before the upcoming spring turnover season.

“An improved macro-economic environment in Boardwalk’s core market of Alberta has accelerated the Trust’s recovery as key indicators have positively impacted the near-term visibility of Boardwalk’s operating environment,” Kolias concluded.

The full report can be found at

Mario Toneguzzi is a veteran Calgary-based journalist who worked for 35 years for the Calgary Herald in various capacities, including 12 years as a senior business writer.

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