First Quarter Results1
Hotel and rental revenue for the three months ended March 31, 2026 increased to $18.5 million compared to $17.7 million in the prior period primarily due to the commencement of operations of the first building in the Talisman's second phase, which was not operational during the comparative period. The Company's net income for the three months ended March 31, 2026 was $14.1 million compared to a loss of $2.4 million in 2025. The net income during the period was primarily a result of a fair value adjustment on investment properties. The net loss in the prior year was primarily attributable to a pension expense resulting from past service costs following a pension plan amendment. Interest and accretion expense decreased year over year as a result of lower interest rates on our floating-rate debt, and a higher component of capitalized interest driven by ongoing construction expenditures in the current quarter compared to 2025.
Other comprehensive loss for the three months ended March 31, 2026 of $1.2 million was a result of net remeasurement losses in the Company's pension plans compared to other comprehensive income in the prior period of $5.4 million related to net remeasurement gains related to the pension plan amendment.
While the Company experienced improvements in both residential and hospitality net operating income compared to the comparative quarter, the results do not fully reflect the significant initiatives made during the quarter due to their timing and nature.
In addition to the efforts related to the arrangement agreement signed with Ravelin Properties REIT ("Ravelin"), which we expect to close in the second quarter, the Company obtained the occupancy permit for the second building of the second phase of the Talisman development and is nearing completion of the third building. Operations for the second building commenced on April 1st and will be reflected in the Company's results beginning in the second quarter. The third and final building of the second phase is expected to be completed in the summer, with operations commencing in the third quarter.
The Company is also commencing a major renovation of its DoubleTree by Hilton hotel in London, Ontario. In addition, construction of the 448-unit residential development branded "The Regent," located adjacent to this hotel, continues to progress.
This is a dynamic period for the Company, with meaningful growth in assets and revenues expected from both organic initiatives across our hospitality and residential businesses, as well as from the anticipated Ravelin acquisition.
During the first quarter of 2026, the Company's book value per common share increased by $0.93, or 4.4%. The Company had net income of $14.1 million during the period which included hotel net operating income of $5.5 million, or $0.40 per common share, residential net operating income of $2.3 million, or $0.17 per common share and a fair value adjustment on investment properties of $19.0 million, or $1.40 per common share, offset by depreciation and amortization of $3.2 million, or $0.24 per common share, interest and accretion of $2.4 million, or $0.17 per common share and income tax expense of $4.8 million, or $0.35 per common share. The Company also recorded remeasurement losses on its pension plans of $1.2 million, or $0.09 per common share in other comprehensive income. The Company's book value per common share at the end of the period was $22.01, while the common share price was $22.94.
Additional commentary on our first quarter results can be found in our Management's Discussion & Analysis for the three months ended March 31, 2026.
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1 Book value per share and net operating income are non-IFRS measures and ratios. Refer to the "Cautionary Statement Regarding Use of Non-IFRS Accounting Measures and Ratios" section of this press release and our March 31, 2026 MD&A for more information.
Other Information
Highlights of the interim condensed consolidated financial statements for the three months ended March 31, 2026, compared to the three months ended March 31, 2025 are as follows:
Three months ended
March 31, 2026
