Automotive Properties Real Estate Investment Trust (TSX:APR.UN, Financial) posted its fourth-quarter 2016 results Monday for the period ended Dec. 31, 2016. The REIT's initial public offering was July 2, 2015 resulting in full-year not being directly comparable.
The company's final quarter of its first full year of operation ended with a 21.7% growth in revenue, up to $9.1 million on the quarter. The REIT posted $7.5 million in revenue in the final quarter of 2015.
Rental increases and acquisitions fueled fourth-quarter growth.
Net operating income came in at $7.7 million, up from $6.5 million marking a 17.9% gain on the quarter. Funds from operations grew 12.7% to $5.0 million year over year. The company's adjusted funds from operations boasted a 21.7% gain in the final quarter, up to $4.6 million.
The company's expenditures during the quarter included two December acquisitions. The REIT purchased a property containing an Audi and Volkswagen (XTER:VOW, Financial) dealership in Quebec for $14.3 million. The REIT entered into an 18-year lease with the operating tenant.
The company also acquired a $20.3 million property on Dec. 22, 2016. The real estate includes the Mercedes-Benz West Island dealership on Boulevard Saint-Jean. The company entered into a 17-year lease with the dealership's owner, Dilawri Group.
Dilawri Group is also the owner of the Audi and Volkswagen dealerships from the deal earlier in the month.
Automotive Properties Real Estate Investment Trust stock remains relatively flat over the past 30-day period but is up 20% over the past 12 months.
Late last week the REIT entered into an agreement to purchase Go Mazda dealership's property in Edmonton, Alberta, for $8 million. The property spans 2.27 acres and includes a 17,150-square foot dealership. The acquisition marks the second between Automotive Properties and Go Mazda's parent company, Go Auto.
Go Auto is one of the largest automotive dealership owner/operators in Canada. The REIT previously purchased Go Auto's Porsche Centre and Jaguar Land Rover Edmonton property in 2015 for $23 million.
The REIT will purchase the property in cash. The REIT will need to complete due diligence before the closing of the property. Both parties expect the deal to close by the end of the month barring any closing condition concerns.
Last week, the REIT announced its March distribution of 6.7 cents per unit for the month of March. Payments will be dispersed on April 17 with an annualized payment of 80 cents per REIT unit.
Automotive Properties Real Estate Investment Trust completed a $46 million equity offering in February. The REIT offered 4,255,000 REIT units to underwriters. The entity will use the funds from the equity offering to reduce its debt and fuel future acquisitions.
The REIT's debt levels rose in December with total purchases of $35.2 million. Automotive Properties drew on its credit facilities to fund the property acquisitions. The REIT has 32 income-producing properties in its portfolio with 1.3 million square feet of property in Canada.
Automotive Properties is the only public vehicle in the country with a focus on automotive properties.
The REIT owns properties in British Columbia, Alberta, Ontario, Quebec and Saskatchewan.
Disclosure:Â Writer does not own any stake in the listed company.
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