MISSISSAUGA, ON, May 9, 2024 /CNW/ - Chartwell Retirement Residences ("Chartwell") (TSX:CSH) announced today its results for the first quarter ended March 31, 2024. Q1 2024 Highlights  Resident revenue increased by $18.1 million from Q1 2023. Net loss was $2.0 million compared to $9.3 million in Q1 2023. Funds from Operations ("FFO")(1) up 61.2% from Q1 2023. Same property adjusted net operating income ("NOI")(1) up 24.7% from Q1 2023. Weighted average same property occupancy up 610 basis points from Q1 2023 and expected to grow to 87.3% by June 2024. "Our teams have done a great job building on the strong momentum of occupancy growth with a 610 basis points increase over the last twelve months. We see this momentum continuing into the summer and expect to achieve 87.3% occupancy by June of this year.  This occupancy growth drove significant improvements in our operating margins and cash flows in the quarter," commented Vlad Volodarski, Chartwell's CEO. "With the growing demand and limited new construction, we expect these positive trends to persist in 2024 and beyond. Our teams are focused on the execution of our successful operations, sales and marketing initiatives to accelerate this growth." Operating Performance Trends In Q1 2024 compared to Q1 2023, same property adjusted NOI increased $11.3 million or 24.7%, primarily due to higher revenue from rental and service rate increases and higher occupancy. In Q1 2024, weighted average occupancy in our same property portfolio was 86.2% compared to 80.1% in Q1 2023. All platforms achieved occupancy gains in Q1 2024 compared to Q1 2023. Same property adjusted operating margin(1) was 35% in Q1 2024 compared to 32% in Q1 2023. Financial Results The following table summarizes select financial and operating performance measures: Three Months EndedMarch 31 ($000s, except per unit amounts, number of units, and occupancy) 2024 2023 Change Resident revenue 183,920 165,824 18,096 Direct property operating expense 121,374 117,874 3,500 Net loss (1,971) (9,253) 7,282 FFO(1) Continuing operations 39,239 20,918 18,321 Total 39,239 24,338 14,901 FFO per unit(1) Continuing operations 0.16 0.09 0.07 Total 0.16 0.10 0.06 Weighted average number of units outstanding (000s)(2) 244,216 239,948 4,268 Weighted average occupancy rate - same property portfolio(3) 86.2 % 80.1 % 6.1pp Same property adjusted NOI(1)   56,798 45,539 11,259 G&A expenses 14,471 15,429 (958) For Q1 2024, resident revenue increased $18.1 million or 10.9% and direct property operating expense increased $3.5 million or 3.0%. For Q1 2024, net loss was $2.0 million compared to $9.3 million in Q1 2023 primarily due to: higher resident revenue, lower depreciation of property, plant and equipment ("PP&E"), higher net income from joint ventures, and lower G&A expenses,       partially offset by: deferred tax expense in Q1 2024 as compared to a deferred tax benefit in Q1 2023, higher direct property operating expenses, absence of income from discontinued operations due to the sale of the Ontario Long Term Care platform ("OLTC Platform")(4), lower gain on asset sales, and higher negative changes in fair values of financial instruments, primarily due to increases in trading prices of our Trust Units. For Q1 2024, FFO from continuing operations was $39.2 million or $0.16 per unit, compared to $20.9 million or $0.09 per unit for Q1 2023. The change in FFO from continuing operations was primarily due to: higher adjusted NOI from continuing operations of $16.9 million, lower G&A expenses of $1.0 million, and higher interest income of $0.4 million. FFO from continuing operations for Q1 2024 includes $0.4 million of Lease-up-Losses(1) and Imputed Cost of Debt(1) related to our development projects (Q1 2023 – $0.8 million).  Total FFO for Q1 2023 includes results of LTC Discontinued Operations of $3.4 million or $0.01 per unit. Financial Position As at March 31, 2024 liquidity(1) amounted to $290.5 million, which included $24.5 million of cash and cash equivalents and $266.0 million of available borrowing capacity on our credit facilities.   The interest coverage ratio(5) was 2.5 at March 31, 2024, compared to 2.3 at December 31, 2023.  The net debt to adjusted EBITDA ratio(5) at March 31, 2024 was 9.7 compared to 10.2 at December 31, 2023. 2024 Outlook and Recent Developments  An updated discussion of our business outlook can be found in the "2024 Outlook" section of our Management's Discussion and Analysis for the three months ended March 31, 2024 (the "Q1 2024 MD&A").  Operations We continue to experience strong demand fundamentals having achieved occupancy growth through the historically weaker winter season.  Our same property portfolio occupancy increased from December to March by 50 bps compared to a 50 bps decline for the same period last year.  We expect to reach 87.3% occupancy in our same property portfolio in June 2024, representing 640 bps growth over the prior year.  Initial contacts and personalized tour activity remains robust, and we are experiencing strong conversion rates to permanent move-ins. We expect this positive momentum to continue throughout 2024. The growth in same property occupancy combined with our blended rental and service rate growth of 4.8%, resulted in a 12.1% increase in same property adjusted resident revenue in Q1 2024 compared to Q1 2023. The chart included (Figure 1) provides an update in respect of our same property occupancy. Growth, Portfolio Optimization, and Repositioning Activities We continue to execute on our portfolio strategies of enhancing our asset base to generate increased NOI, acquiring new strategic facilities in core markets and selling non-core assets, including: On May 3, 2024, we acquired an 85% interest in Chartwell Le Prescott from Batimo. Le Prescott is a 324-suite residence completed in 2017 and is located in the Montreal suburb of Vaudreuil, Quebec. The residence is operating at 97.7% current occupancy. The acquisition price of $80.2 million was partially settled through the assumption of a $41.8 million mortgage bearing interest at the rate of 8.5% maturing on December 1, 2024. We expect to refinance the assumed mortgage with CMHC insured debt. Of the total purchase price, $1.7 million will be held in escrow for other contingent liabilities. The remainder of the purchase price, subject to normal working capital and other closing adjustments was paid in cash utilizing cash on hand and credit facilities. We expect to close on an 85% interest in the 361-suite Chartwell Trait-Carré residence located in Quebec City in Q2 2024 for a purchase price of $85.8 million. Trait-Carré is a new build having been completed in February 2021 and is currently operating at 94.6% occupancy. The acquisition price will be partially settled through the assumption of a $58.3 million mortgage bearing an interest rate of 8.3%. Chartwell expects to refinance the assumed mortgage with CMHC insured debt. The remainder of the purchase price, subject to normal working capital, other closing adjustments and $0.2 million of NOI support for six months, will be paid in cash utilizing cash on hand and credit facilities. During Q1 2024, we invested $15.5 million in our same property portfolio on suite turns, suite upgrades, interior upgrades and building components as we continue to allocate capital to modernize our residences. On March 19, 2024, we commenced the operational closure of Chartwell Heritage Glen Retirement Residence (323 suites). The completed sale of our OLTC Platform in 2023 included a forward sale contract for $64.5 million related to Ballycliffe LTC, a 224-bed long term care home redevelopment. With the announced LTC funding increases in Ontario, we expect the value of the completed property to be higher than the forward sale contract price. We exercised our option to terminate the forward sale contract effective April 1, 2024, as the agreement allowed for this if the development was not completed by this date. We intend to commence a sale process for Ballycliffe LTC once the construction is completed. Liquidity and Financing As at May 9, 2024, liquidity amounted to $279.5 million, which included $37.5 million of cash and cash equivalents and $242.0 million of available borrowing capacity on our Credit Facilities. As of the date of this release, and for the remainder of 2024, we have $141.1 million of mortgage debt maturing at the weighted average rate of 3.32%. At May 9, 2024, 10-year CMHC-insured mortgage rates are estimated at approximately 4.57% and five-year conventional mortgage financing is available at 5.75%. In May 2024, our $125.0 million unsecured ...