Operational and Balance Sheet Highlights
The Company ended the year in a strong liquidity position with $483.0 million of cash and available credit facilities, and has a $1.1 billion pool of unencumbered properties and other investments.
The Company has a commitment to sell its leasehold interest in an office property consisting of 328,500 square feet located in Ottawa, Ontario, for gross proceeds of $148.2 million (or $451 per square foot), excluding closing costs. The transaction is scheduled to close on August 31, 2026.
The Company issued $250.0 million principal amount of 5.00% Series I senior unsecured debentures due on October 14, 2028.
The Company incurred $97.2 million of development expenditures, predominantly at the Company's residential project comprising 431 suites located in Mississauga, Ontario.
The Company refinanced maturing mortgages for additional net proceeds of $50.8 million at an average interest rate of 4.77% and an average term of 5.7 years.
The Company acquired the remaining 40% ownership interest in Lincluden Investment Management Limited, for a purchase price of $4.0 million, including closing costs and recently rebranded to Morguard Lincluden Global Investments, bringing together Morguard's scale, financial strength, and institutional platform with Lincluden's established value investing expertise.
As at December 31, 2025, the Company's total assets were $11.8 billion, consistent compared to December 31, 2024.
Reporting Highlights
Total revenue from real estate properties was consistent at $1.0 billion for the year ended December 31, 2025, compared to the same period in 2024.
Normalized funds from operations(1) ("Normalized FFO") was $220.5 million, or $20.61 per common share, for the year ended December 31, 2025. This represents an increase of $0.1 million, or 0.1%, compared to
$220.4 million, or $20.39 per common share for the same period in 2024.
NOI decreased by $5.3 million, or 0.9%, to $561.6 million for the year ended December 31, 2025, compared to $566.9 million for the same period in 2024, predominantly due to lower NOI in the office segment from Obsidian Energy's lease expiry at Penn West Plaza, partially offset by higher NOI in multi-suite residential segment, a favourable impact from a change in foreign exchange rate and the net impact of acquisitions and dispositions.
Comparative NOI(1) decreased by $10.8 million or 1.9% to $551.2 million for the year ended December 31, 2025, compared to $562.0 million for the same period in 2024.
Net income decreased by $60.7 million to $178.9 million for the year ended December 31, 2025, compared to $239.6 million for the same period in 2024, primarily due to a gain on sale of hotel properties in 2024 and decrease in net operating income, partially offset by a decrease in non-cash net fair value loss.
1) Refer to Specified Financial Measures
Financial Highlights
For the years ended December 31
(in thousands of dollars)
2025
2024
Revenue from real estate properties
$1,033,007
$1,032,802
Revenue from hotel properties
31,430
35,242
Management and advisory fees
41,243
39,679
Interest and other income
17,902
19,360
Total revenue
$1,123,582
$1,127,083
Revenue from real estate properties
$1,033,007
$1,032,802
Revenue from hotel properties
31,430
35,242
Property operating expenses
(480,948)
(475,143)
Hotel operating expenses
(21,878)
(25,998)
Net operating income ("NOI")
$561,611
$566,903
Net income attributable to common shareholders
$174,870
$261,799
Net income per common share, basic and diluted
$16.34
$24.23
Funds from operations(1)
$221,599
$206,651
FFO per common share – basic and diluted(1)
$20.71
$19.12
Normalized funds from operations(1)
$220,491
$220,361
Normalized FFO per common share – basic and diluted(1)
$20.61
$20.39
(1) Refer to Specified Financial Measures.
Total revenue during the year ended December 31, 2025, was $1.1 billion, a decrease of $3.5 million compared to 2024, mainly due to a decrease in hotel revenue from the sale of 14 hotels on January 18, 2024 (the "Hotel Portfolio Disposition") in the amount of $3.8 million, partially offset by a $1.6 million increase in management and advisory fees due to higher leasing, property and asset management fees earned, net of a decrease in disposition and project management fees earned. In addition, the increase in revenue was also due to an increase in revenue from real estate properties in the amount of $0.2 million, primarily due to higher average monthly rent ("AMR"), net of an increase in vacancy within the multi-suite residential segment and an increase in vacancy from the Obsidian Lease Expiry (defined below) at Penn West Plaza. In addition, revenue increased from the change in foreign exchange rate and from the net impact of acquisition and disposition of properties.
Net income for the year ended December 31, 2025 was $178.9 million, compared to $239.6 million in 2024. The decreased in net income of $60.7 million for year ended December 31, 2025 was primarily due to the following:
A decrease in NOI of $5.3 million, mainly due to a decrease in gross rent and an increase in vacancy costs at Penn West Plaza, resulting from the Obsidian Lease Expiry, partially offset by an increase in AMR, higher non-recurring property tax refunds received, net of higher vacancy at multi-suite residential properties, the change in foreign exchange rate and from the net impact of acquisition and disposition of properties;
A decrease in non-cash net fair value loss of $94.8 million, mainly due to a decrease in fair value loss on Morguard Residential REIT units, an increase in fair value gain on real estate properties and an increase in fair value gain on marketable securities;
A decrease in gain on sale of hotel properties of $150.6 million due to the Hotel Portfolio Disposition; and
An increase in income tax expense (current and deferred) of $2.7 million, mainly due to a deferred tax increase from a higher fair value gain recorded on the Company's Canadian and U.S. properties, partly offset by a decrease in current taxes resulting from the sale of properties in 2024.
Average Occupancy Levels
The following table provides occupancy by asset class for the following periods:
Suites/GLA
Square Feet
Dec.
2025
Sep.
2025
Jun.
2025
Mar.
2025
Dec.
2024
Multi-suite residential
17,798
92.4 %
93.5 %
94.9 %
