Timothy Melton, Melcor's Executive Chair and Chief Executive Officer, commented: "2025 marks a milestone year for Melcor, with revenues exceeding $400 million and funds from operations exceeding $100 million, both for the first time in Melcor's history. Importantly, this achievement was realized while maintaining a conservative balance sheet and a disciplined, long-term approach to value creation.
Our Land division had an exceptional year, with revenues up 28.7% to $292.49 million (2024 - $227.27 million). Results were significantly influenced by the sale of 198.40 acres of unserviced land in La Privada, Arizona which contributed to the $65.21 million in revenue generated from our US Land division in early 2025. Revenues within our Canadian region also delivered strong and balanced performance, with our Edmonton and Calgary regions together contributing $201.99 million (2024 - $196.27 million) in revenues.
In 2025, we continued to actively reshape the Properties portfolio through the strategic disposition of non-core assets while selectively reinvesting in new development. During the year, we completed the sale of four commercial properties - Evans Business Centre, Melcor Crossing, Coast Home Centre, and Westgrove Common - for total net proceeds of $87.25 million. Subsequent to year end, we also sold our Staples Building for net proceeds of $12.07 million. We also completed the development of 7 new commercial buildings, totaling 82,209 sf. As a result of the property sales, revenue from our Properties division was down 4.7% to $106.61 million (2024 -$111.92 million).
Our Properties portfolio has continued to be impacted by fair value adjustments driven by broader market conditions outside of managements control. In 2025, we recognized a fair value loss of $25.88 million (2024 - $28.44 million). These changes are a reflection of fluctuations in valuation inputs such as market pricing, interest rates and investor return expectations rather than underlying performance. As a result, fair value adjustments may fluctuate period to period despite a consistent portfolio strategy.
Our Golf division saw an increase of rounds played in 2025 of 5.5% to 129,612 (2024 - 122,824), with revenues also increasing 9.1% to $12.49 million (2024 - $11.45 million) in the year.
In April 2025, we completed the acquisition of the public interest in Melcor REIT for $5.50 per unit. By bringing the REIT's assets back under a single corporate structure, we reunited ownership and operations. Despite the large cash outlay required for the REIT transaction, we have reduced our general debt in the past 12 months by $62.60 million to $548.74 million (December 31, 2024: $611.34 million) primarily the result of property disposals and strong Land division revenue. Our debt-to-equity ratio on December 31, 2025 was 0.62, down from 0.70 at December 31, 2024.
Following an exceptional year, the Board has declared a special dividend of $0.35 per share, reflecting our commitment to returning capital to shareholders. In addition, we declared our regular quarterly dividend of $0.15 per share, underscoring the strength of our business and balance sheet.
The special dividend and quarterly dividend are payable on March 31, 2026 to shareholders of record on March 20, 2026. Both dividends are eligible dividends for Canadian tax purposes.
MELCOR REIT TRANSACTION (the "Transaction") Melcor and Melcor REIT ("REIT" or "the REIT") entered into an arrangement agreement (the "Arrangement") in late 2024 whereby Melcor would acquire its unowned equity interest (approximately 44.6%) in Melcor REIT Limited Partnership ("REIT LP") for $5.50 per Class A LP Unit, for total consideration of $71.30 million (the "REIT LP Sale").
The Arrangement was approved by the REIT's unitholders and the Court of King's Bench of Alberta granted the final order in respect of the Arrangement in early 2025. The Transaction closed on April 23, 2025 and the REIT's Units were delisted from the Toronto Stock Exchange after the markets closed on April 24, 2025. The REIT ceased to be a reporting issuer and terminated its public reporting obligations after the Units were delisted. Proceeds from the REIT LP Sale were used to repurchase and cancel all of the REIT's outstanding participating trust units (each, a "Unit") for consideration (the "Consideration") of $5.50 per Unit less any applicable withholding taxes.
Subsequent to the Transaction, Melcor owned 100% of the REIT and REIT LP and the REIT Unit liability was settled. As a result of the Transaction, there was an additional $23.09 million in deferred tax expense recorded in 2025 as Melcor's ownership in the REIT LP increased from 55.4% to 100%. We also recorded $7.08 million in transaction costs and other fees related to the Transaction of which $5.88 million were considered directly attributable to the acquisition and accordingly included in Adjustments related to REIT units in the consolidated statement of income, with the balance of costs recorded through general and administrative expenses.
On November 30, 2025 the REIT was terminated pursuant to the Declaration of Trust. Subsequent to year end, on January 30, 2026 REIT LP was wound up, Melcor continues to own Melcor REIT GP Inc.
Further details regarding the Transaction are contained in a REIT management information circular which was filed on SEDAR+ under the REIT's profile at www.sedarplus.ca.
Financial Highlights Financial highlights of our performance are summarized below:
Fourth quarter:
Revenue was up 9.7% to $187.12 million (Q4-2024: $170.54 million)
Net income was down 2.3% to $31.65 million (Q4-2024: $32.38 million)
Funds from operations (FFO) was up 12.4% to $48.82 million (Q4-2024: $43.44 million)
Basic earnings per share was down 1.9% to $1.05 per share (Q4-2024: $1.07 per share)
Year-to-date:
Revenue was up 17.5% to $410.55 million (2024: $349.50 million)
Net income was up 73.0% to $58.02 million (2024: $33.53 million)
Funds from operations (FFO) was up 30.2% to $122.14 million (2024: $93.81 million)
Basic earnings per share was up 74.5% to $1.92 per share (2024: $1.10 per share)
Selected Highlights
($000s except as noted)
Three Months Ended December 31,
Year Ended December 31,
2025
2024
% Change
2025
2024
% Change
Revenue
187,122
170,538
9.7
%
410,547
349,501
17.5
%
Gross margin (%)(3)
38.1%
41.1%
(7.3)
%
46.2%
45.0%
2.7
%
Fair value adjustment on investment properties
(20,596)
(2,825)
629.1
%
(25,878)
(28,439)
(9.0
)%
Net income
31,652
32,384
(2.3)
%
58,019
33,528
73.0
%
Net margin (%)(3)
16.9%
19.0%
(11.1)
%
14.1%
9.6%
46.9
%
Funds from operations(1)
48,824
43,436
12.4
%
122,137
93,806
30.2
%
Per Share Data ($)
Basic earnings
1.05
1.07
(1.9)
%
1.92
1.10
74.5
%
Diluted earnings
1.05
1.05
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