NorthWest Healthcare Properties REIT Q1 2023 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Michael Markidis - BMO Capital Markets Equity Research - Analyst : If I could just start off on the fair value loss that you booked. Perhaps you can give us a little bit more color by region. The reason I ask is just that, I think if we look at the disclosure, it looks like at least in your equity accounted JVs, the values were flat in Australia -- were relatively flat in Australia and Europe. And I think you noted that the values were up in Brazil. So should we infer that the bulk of the negative adjustment would then be the U.S., Canada and the U.K.?

Question: Michael Markidis - BMO Capital Markets Equity Research - Analyst : Okay. Great. So you guys got the -- you did the [converge] first quarter, congrats on that, to paydown some more high-cost corporate debt. If we just look at the variable rate corporate debt, how much is the REIT left with after that transaction? And how does the cost on what's left? Because I think you have different tranches and costs compared to the 9.3%. And then the last question for me is just with all the capital repatriation with the U.K., the asset sales and the U.S. JV expected sort of throughout the course of this year. Do you think that you can get the corporate debt down? I mean, excluding the converge your variable rate corporate debt down to 0 by the end of this year.

Question: Michael Markidis - BMO Capital Markets Equity Research - Analyst : Got it. Okay. And then just last question for me before I turn it back. I guess the U.K. JV is progressing as anticipated. It's only been 6 weeks, I think, since we last talked. So no changes there. Maybe just with respect to the US, I think the verbiage that you guys talked to put forth in the press release and the MD&A hasn't changed much as well. But maybe, Paul, if you could just explain a little bit how that process is going and if there's been any change or puts and takes with respect to the conversation with the parties at the table as it relates to the U.S. JV. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 12, 2023 / 2:00PM, NWH_u.TO - Q1 2023 NorthWest Healthcare Properties REIT Earnings Call

Question: Michael Markidis - BMO Capital Markets Equity Research - Analyst : Okay. And then I -- sorry, just one last one before I turn it back. I think you guys -- one of the assets that you're selling is in the U.S. Maybe just give us some comments in terms of how that property didn't fit with the overall strategy in the U.S.

Question: Pammi Bir - RBC Capital Markets, Research Division - Analyst : You mentioned potentially using some of your excess liquidity towards unit repurchases. I'm just curious, how do you balance that? Maybe how active do you expect to be? And how do you balance that story with respect to your debt reduction initiatives?

Question: Pammi Bir - RBC Capital Markets, Research Division - Analyst : Right. Okay. And then just on the U.S. JV, what sort of your expectation as to where -- I realize, obviously, this is still a negotiation process. But where do you see potential transaction relative to your IFRS book value at this stage?

Question: Pammi Bir - RBC Capital Markets, Research Division - Analyst : Right. And the property that is currently out for sale. I just wanted to confirm, Shailen, was that in line with the -- and there's no write-down taken on that or was there just any color?

Question: Pammi Bir - RBC Capital Markets, Research Division - Analyst : Okay. And then just lastly, with the 20% increase that you expect to be able to achieve on a quarterly basis, I guess, in AFFO. How much of that will be driven by a recovery in the fee income?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Just a clarification on the previous question with respect to the U.S. JV fair values, but the 5% to 10% within IFRS, is that as of the Q1 (inaudible) IFRS value or relative to the purchase price. And I'm not sure if there's a meaningful difference between the 2.

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Got it. Okay. And then secondly, more of a broader-based conceptual question, Paul, that the asset management business has been growing for several years now. Outside of your conversations with LPs of the U.S. JV, which my sense is it's a bit more directed or targeted in terms of the discussions. But how would you characterize the magnitude of your discussions with global LPs today in terms of future product offerings relative to 3 to 5 years ago? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 12, 2023 / 2:00PM, NWH_u.TO - Q1 2023 NorthWest Healthcare Properties REIT Earnings Call

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Got it. Okay. And is health care generally a product that doesn't align well with opportunistic funds or opportunistic returns? Or do you see yourself in the future kind of expanding the product offering to opportunistic type returns that will put core (inaudible)?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. Maybe 2 more quick ones on line, if I may. You mentioned or you highlighted I guess, Canada and Brazil being 2 markets where you're still in 100% of the assets and the desire to get down to a 25% interest (inaudible) portfolio-wide. Are there any specific nuances that would make that becoming a reality in those 2 countries, any more or less challenging relative to what you experienced in the [other markets today]?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Yes. Yes. No, that works. And then just for Shailen, I may have missed it, but on the $515 million of debt that's associated with the assets held for sale, what's the average debt cost on that?