Great-West Life Real Estate Fund

• The Fund generated a Q1 gross return of 1.9%, contributing to a trailing twelve-month total return of 9.3%.¹ The quarterly performance was led by its income return at 1.1%, which benefited from a 94% occupancy rate and a well-diversified tenant base.
• The Great-West Life Real Estate Fund closed the quarter with a $387 million cash position and maintains the potential for additional liquidity through property cash-flow, mortgage financing and asset sales, should the latter be deemed in the Fund’s best interest.
• The Fund continues to implement a measured capital expenditure strategy, prioritizing life and safety projects, remaining focused on long term value creation.
• The Fund’s well distributed mortgage profile includes $88 million of 2020 maturity, representing only 8.2% of its total mortgage balance. Fund management is actively advancing dialogue with lenders regarding refinancing.
• While construction on the Fund’s two active developments slowed in Q1, progress has continued. The two-tower, 530-unit multi-family Grenadier Square project in Toronto is scheduled for respective delivery in Q3 and Q4 of 2020. The 371,000 square foot Vancouver Centre II office project remains scheduled for completion in Q4 2021.  
• In response to the COVID-19 conditions, the Fund manager, GWL Realty Advisors, implemented a response plan, focused on supporting the needs of its employees, service partners, tenants and residents.
• Management implemented a short-term rent-deferral program to support qualifying small and independent tenants with documented hardship. The approved deferrals total $1.9 million, or 41bps relative to the Fund’s 2019 revenue of $466 million.
• April rent collection, inclusive of rent deferrals, was strong at 93% through May 5, 2020. The office, industrial and multi-family sectors led the portfolio at 95% or better, while retail trailed at 74%. The Fund’s 11% allocation to retail helps to mitigate the impact on the Fund’s total collections.  

The Great-West Life Real Estate Fund ,and the Canadian commercial real estate market at large, was generally well positioned leading into the COVID-19 pandemic. The Fund’s diversified portfolio, both by geography and asset class, together with a strong occupancy profile and tenant roster, position it as an important component of a diversified investment portfolio.

¹ Due to market uncertainty related to the valuation of real estate, the current unit value and rate of return for the real estate fund may not accurately reflect the market value of the properties held by the fund.