STARLIGHT U.S. RESIDENTIAL FUND ACHIEVES ANNUALIZED RENT GROWTH OF 17.4% DURING Q3-2022, DISTRIBUTIONS P
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TORONTO, Nov. 25, 2022 /CNW/ - Starlight U.S. Residential Fund SURF SURF (the Fund) announced today its results of operations and financial condition for the three months ended September 30, 2022 (Q3-2022) and nine months ended September 30, 2022 (YTD-2022).
All amounts in this press release are in thousands of United States (U.S.) dollars except for average monthly rent1 (AMR) or unless otherwise stated. All references to C$ are to Canadian dollars.
The Fund continued to achieve strong operating results during Q3-2022 including 17.4% annualized rent growth and same property net operating income growth of 15.0%(1), reflecting the Fund's ability to take advantage of favorable operating conditions and increase NOI despite the inflationary pressure on operating costs. Operating fundamentals continued to be strong with the Fund's properties delivering rent growth at unprecedented levels.
The Fund is a closed-end investment vehicle with a strategy to maximize disposition proceeds by selling assets unencumbered during or at the end of the Fund's three year term. The Fund's strategy has been successfully deployed by the Fund's manager, Starlight Investments US AM Group LP or its affiliates (the Manager), in prior U.S residential funds during the past ten years resulting in attractive total returns(2). To meet this objective and given the Fund's relatively short, three year term, the Fund's financing strategy has been to source shorter-term, flexible mortgage debt which is repayable with no or minimal cost. As a result, the Fund's properties are financed with variable rate mortgages, rather than long-term, fixed rate debt with restrictive and costly repayment terms. To provide some mitigation against increases in interest rates, the Fund has purchased interest rate caps for certain of the Fund's loans, which expire in late 2023 and 2024(3).
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