NorthWest Healthcare Properties REIT Q2 2021 Earnings Call Transcript

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

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Paul, I just wanted to delve into a bit more detail on your $2 potential [entity] upside in the near term. How would you break that down between cap rate compression, the value-add with the U.K. venture? And then potentially development upside? And I ask this, because I don't know how much of the $200 million of U.K. venture value creation above cost is currently in your IFRS today.

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Perfect. Okay. Operationally, Australia has had some more recent challenges with the Delta variant. Can you highlight any changes in rent collection or request for rent deferral and things on those lines within your portfolio in the past couple of months?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Perfect. Okay. And then it seems like there's never a dull moment with you, and so far as there's a lot of opportunities globally with the expansion of your asset management franchise over time, you mentioned Australian Unity and that perhaps being kind of a multi process step that could take a bit of time. When we sit back, how do we think about the sequencing of Australia in kind of deploying that excess capital that you have with your institutional partner, the U.K. venture, the -- your potential entry into the U.S. and then any potential structural changes in Brazil and in Canada down the road. Is there enough organizational depth to be able to do all that simultaneously? Or should we think about it one step out of a time? And if so, how should we think about the sequencing of that over the next 2 years?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Understood. And then when we think about your equity needs to accomplish these initiatives, presumably acquiring with your consortium partner, 100% interest in AUHPT was perhaps the base case, I'm not sure if that's the base case going forward after the multistage process or not. But when we look at Australia, the seating of the capital or the seating of the assets in the U.K. and then potential initiatives in North America, given where your balance sheet is today, are you comfortable that you have all the necessary -- or you will have all the necessary required equity to kind of execute on those initiatives going forward?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Understood. Okay. And your comment on development or value-add initiatives representing 10% to 15% of the balance sheet over time. Is that on a consolidated basis? Or would that represent your proportion of interest or NorthWest proportion of interest in those initiatives to proportion of the balance sheet?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Maybe one more quick one from me in recognition of the time. The good with development is longer term, not for unit growth, longer-term AFFO per unit growth, better quality portfolio. The bad in the near term is there's no income that's dilutive. So how do you -- as development becomes a bigger part of the story, how do you balance those 2? And do you have kind of a medium to long-term AFFO per unit growth target that you want to achieve?

Question: Mario Saric - Scotiabank Global Banking and Markets, Research Division - Analyst : Got it. Okay. And then just maybe the second part of that question, Shailen talked about it structurally, 3% same-store NOI growth. You have a very prolific global asset management business that layers on incremental fee. Like if your 3-year to 5-year business plan goes according to plan, what type of targeted AFFO per unit growth do you think the Company in its standpoint can achieve?