UPDATE 1-InnVest REIT posts Q1 FFO loss

* Q1 FFO loss C$0.041/unit vs FFO C$0.006/unit last year

* Hotel operating margins falls 150 basis points

May 7 (BestGrowthStock) – Canada’s InnVest Real Estate Investment
Trust (INN_u.TO: ) posted a loss in funds from operations (FFO)
in the first quarter, hurt in part by lower hotel operating
income, but said it is hopeful about improvements in the
broader economy.

“We are hopeful that improvements in the broader economy
will continue to positively affect the lodging industry and our
hotel operating results,” Chief Executive Kenneth Gibson said
in a statement.

FFO — a property measure that strips out the distorting
effects of depreciation and other factors from earnings — for
the REIT in the quarter was a loss of C$3.6 million, or 4.1
Canadian cents per unit.

That compares with FFO of C$447,000, or .06 Canadian cents
a unit last year.

Hotel operating margins declined 150 basis points,
reflecting a decline in revenue per available room (revpar),
the trust said.

Revpar on a same hotel basis in the quarter fell 5 percent,
driven by continued caution in economic environment and impact
on discretionary travel demand.

Higher interest expenses as well as the higher number of
units outstanding following an equity offering in Oct 2009 also
impacted first quarter results.

“While we expect that the worst may be behind us, we
continue to manage our portfolio conservatively with ongoing
emphasis on maximizing profits.”

Units of the REIT closed at C$6.60 Thursday on the Toronto
Stock Exchange.

Investment Analysis

(Reporting by Isheeta Sanghi in Bangalore; Editing by Prem
Udayabhanu) (([email protected]; within U.S. +1
646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging:
[email protected]))

UPDATE 1-InnVest REIT posts Q1 FFO loss