Winnipeg - Lanesborough Real Estate Investment Trust ('LREIT') (TSXV: LRT.UN) today reported its operating results for the year ended December 31, 2019.

The following comments in regard to the financial position and operating results of LREIT should be read in conjunction with management's discussion & analysis, the annual report and the financial statements for the year ended December 31, 2019, which may be obtained from the SEDAR website at www.sedar.com.

Overall Results

LREIT completed 2019 with a loss and comprehensive loss of $34.1 million, compared to a loss and comprehensive loss of $46.5 million in 2018. The decrease in the extent of the loss and comprehensive loss is mainly due to a decrease in the loss relating to fair value adjustments, partially offset by an increase in the loss from discontinued operations, a decrease in NOI and an increase in interest expense.

Unfavourable fair value adjustments recognized during 2019 were $15.5 million compared to unfavourable fair value adjustments recognized during 2018 of $35.3 million as the decline in demand in the Fort McMurray rental accommodation market appears to be stabilizing

The increase in the loss from discontinued operations of $4.0 million is mainly due to an increase in loss from impairment adjustments of $2.6 million and an increase in property operating costs of $1.4 million. The impairment adjustment recognized during 2019 of $2.6 million reflects a reduction in the carrying value of Chateau St. Michael's, the property classified as property and equipment under discontinued operations.

The impairment adjustment was required as the carrying value of the property was determined to be in excess of the estimated recoverable amount, primarily as a result of capital expenditures identified as being required to sustain the operations of the facility. The increase in property operating costs mainly reflects an increase in wages as part of the coordinated effort to expand the facility's intermediate care offerings and to enhance the level of care and services provided. The decrease in NOI of $2.0 million mainly reflects an increase in property operating costs of $1.5 million or 13% and a decrease in rental revenue of $0.5 million. The increase in property operating costs is mainly due to the accrual of condominium corporation special assessment fees associated with electrical repairs at Woodland Park, the property classified as held for sale, and an increase in insurance premiums in the Fort McMurray property segment, partially offset by a decrease in costs related to insurance claims and a decrease in property taxes in the Fort McMurray property segment.

The decrease in rental revenue mainly reflects a decrease in the average monthly rental rate of the Fort McMurray property portfolio as the prolonged low-level of oil sands development activity continues to negatively impact the demand for rental accommodations in Fort McMurray. The increase in interest expense during 2019 of $1.7 million mainly reflects an increase in interest on the revolving loan from 2668921 Manitoba Ltd. Of $1.8 million as a result of an increase in the average outstanding balance of the revolving loan.

ABOUT LREIT

LREIT is a real estate investment trust, which is listed on the TSX Venture Exchange under the symbols LRT.UN (Trust Units) and LRT.DB.G (Series G Debentures).

Contact:

Tel: (204) 475-9090

Fax: (204) 452-5505

Email: info@lreit.com

This press release contains certain statements that could be considered as forward-looking information. The forward-looking information is subject to certain risks and uncertainties, which could result in actual results differing materially from the forward-looking statements

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