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Average in-place net rent per occupied square foot continued its steady improvement, ending the fourth quarter at $25.41. Allied continued to achieve rent increases on renewal in the fourth quarter (up 2.0% ending-to-starting base rent and up 5.9% average-to-average base rent).

2024 Acquisitions and Non-Core Property Sales

“We remain committed to our vision, mission and core strategy,” said Michael Emory, Founder & Executive Chair. “Given our confidence in the future of Canada’s major cities, we’ll continue to grow our business with a view to serving knowledge-based organizations ever more comprehensively and successfully over time.”

In 2024, Allied acquired three triple-A urban properties for $677 million -- 400 West Georgia Street in Vancouver, the remaining 50% interest in 19 Duncan Street in Toronto and an additional 16.7% interest in the residential component of TELUS Sky (now known as “Calgary House”), bringing its ownership to 50%. The aggregate acquisition price was below development and replacement cost.

• 400 West Georgia is comprised of 340,846 square feet of office GLA, 6,546 square feet of retail GLA and 163 underground parking stalls. The property is 82% leased to Deloitte, Apple, Northeastern University, Spaces, RBC, a local café and a local restaurant, all with a weighted-average lease term of 11 years. Completed in late 2023, the property is designated LEED Platinum.

• 19 Duncan is comprised of 149,230 square feet of office GLA, 3,570 square feet of retail GLA, 464 rental-residential units, related common areas and facilities, 25 underground commercial parking stalls and 106 underground residential parking stalls. The office component is fully leased to Thomson Reuters with a weighted-average lease term of 8.6 years. The lease-up of the residential component is underway and is expected to be completed in early 2026. With the office component completed in late 2023 and the residential component (known as “Toronto House”) to be completed shortly, the property is designed to, and applying for designation as, LEED Gold.

• Calgary House is comprised of 326 rental-residential units, related common areas and 176 underground parking stalls. The property is 91.8% leased. Completed in late 2020, the property is designated LEED Gold.

Allied paid for the three triple-A urban properties by (i) converting loans receivable of $232 million into equity and (ii) incurring $445 million of short-term, variable-rate debt on 400 West Georgia and 19 Duncan. Allied has since replaced the debt on 400 West Georgia with a first mortgage of $180 million at 5.25% per annum for a term of five and one-half years. Allied has since sold seven lower-yielding, non-core properties -- four in Montréal, one in Toronto, one in Ottawa and one in Calgary -- for $229 million, which was allocated to debt repayment in the fourth quarter.

In Management’s view, the temporary contraction in cashflow per unit resulting from the acquisition of 400 West Georgia and 19 Duncan represents an investment in the future, one that will drive earnings and value growth on completion of lease-up by 2026. Management is also of the view that the two properties are important in meaningfully augmenting the Allied Modern format in two of Canada’s most important urban office markets.

2024 Balance-Sheet Management

By the end of 2024, Allied

(i) reduced the amount drawn on its $800 million unsecured revolving operating facility to nil, affording it considerable liquidity going into 2025,

(ii) reduced short-term, variable rate debt to $153 million, representing 3.5% of its total debt,

(iii) had a total debt ratio⁽¹⁾ of 41.7% and

(iv) had net debt as a multiple of annualized adjusted EBITDA⁽¹⁾ of 10.8x.

Allied is committed to maintaining and ultimately improving its access to the debt capital markets and will continue to manage its balance sheet accordingly.

Outlook

Allied is experiencing steady demand for urban workspace, urban rental-residential space and urban amenity space, as well as strong and quantifiable engagement among users of space in its portfolio generally. Management expects this to underpin growth in same-asset NOI⁽¹⁾ in 2025 of approximately 2%. With the higher overall interest cost flowing from the 2024 acquisitions, Management expects FFO⁽¹⁾ and AFFO⁽¹⁾ per unit to contract in 2025 by approximately 4%.

Allied’s specific operating goals for year-end 2025 are as follows:

(i) to have reached occupied and leased area of at least 90%;

(ii) to have sold lower-yielding, non-core properties, primarily in Montréal, Calgary, Edmonton and Vancouver, for at least $300 million and at or above IFRS value, with allocation of proceeds to debt repayment;

(iii) to have fully monetized its loan receivable secured by 150 West Georgia Street in Vancouver with allocation of proceeds to debt repayment; and

(iv) to have net debt as a multiple of annualized adjusted EBITDA below 10x, despite an expected temporary increase in the first quarter of 2025.
_____________________________________________________________________________
^{(1) This is a non-GAAP measure. FFO per unit and AFFO per unit exclude condominium-related items, financing prepayment costs, and the mark-to-market adjustment on unit-based compensation. Refer to the Non-GAAP Measures section below.}
Financial Measures

The following tables summarize GAAP financial measures for the three months and years ended December 31, 2024, and 2023:

^{(1) For the three months ended December 31, 2024, general and administrative expenses increased by $1,645 or 24.4% from the comparable period. This was primarily due to the change in the mark-to-market adjustments on unit-based compensation of $1,618. The mark-to-market adjustment on unit-based compensation is added back in the calculation of FFO as defined in REALPAC's "Funds From Operations (FFO) & Adjusted Funds From Operations (AFFO) for IFRS" issued in January 2022.}

^{(1) For the year ended December 31, 2024, general and administrative expenses increased by $756 or 3.2% from the comparable period primarily due to the change in mark-to-market adjustments on unit-based compensation of $387. The mark-to-market adjustment on unit-based compensation is added back in the calculation of FFO as defined in REALPAC's "Funds From Operations (FFO) & Adjusted Funds From Operations (AFFO) for IFRS" issued in January 2022.}

The following table summarizes other financial measures as at December 31, 2024, and 2023:

^{(1) This measure is presented on an IFRS basis.
(2) This is a non-GAAP measure and includes the results of the continuing operations and the discontinued operations. Refer to the Non-GAAP Measures section below.
(3) Prior to Allied's conversion to an open-end trust, net asset value per unit ("NAV per unit") was calculated as total equity as at the corresponding period ended, divided by the actual number of Units and class B limited partnership units of Allied Properties Exchangeable Limited Partnership ("Exchangeable LP Units") outstanding at period end. With Allied's conversion to an open-end trust on June 12, 2023, NAV per unit is calculated as total equity plus the value of Exchangeable LP Units as at the corresponding period ended, divided by the actual number of Units and Exchangeable LP Units. The rationale for including the value of Exchangeable LP Units is because they are economically equivalent to Units, receive distributions equal to the distributions paid on the Units and are exchangeable, at the holder's option, for Units.}

Non-GAAP Measures

Management uses financial measures based on International Financial Reporting Standards ("IFRS" or "GAAP") and non-GAAP measures to assess Allied's performance. Non-GAAP measures do not have any standardized meaning prescribed under IFRS, and therefore, should not be construed as alternatives to net income or cash flow from operating activities calculated in accordance with IFRS. Refer to the Non-GAAP Measures section on page 17 of the MD&A as at December 31, 2024, available on www.sedarplus.ca, for an explanation of the composition of the non-GAAP measures used in this press release and their usefulness for readers in assessing Allied's performance. Such explanation is incorporated by reference herein.

The following tables summarize non-GAAP financial measures for the three months and years ended December 31, 2024, and 2023:

^{(1) These non-GAAP measures include the results of the continuing operations and the discontinued operations (except for Same Asset NOI - rental portfolio, which only includes continuing operations).}

^{(1) These non-GAAP measures include the results of the continuing operations and the discontinued operations (except for Same Asset NOI - rental portfolio, which only includes continuing operations).}

The following tables reconcile the non-GAAP measures to the most comparable IFRS measures for the three months and years ended December 31, 2024, and 2023. These terms do not have any standardized meaning prescribed under IFRS and may not be comparable to similarly titled measures presented by other publicly traded entities.

The following table reconciles Allied's net loss and comprehensive loss to Adjusted EBITDA, a non-GAAP measure, for the three months and years ended December 31, 2024, and 2023.

^{(1) Includes Allied's proportionate share of the equity accounted investment's fair value loss on investment properties of $604 and $391 for the three months and year ended December 31, 2024, respectively (December 31, 2023 - $15,039 and $19,677, respectively).
(2) The Adjusted EBITDA for the year ended December 31, 2023 includes the Urban Data Centre segment which was classified as a discontinued operation from Q4 2022 until its disposition in August 2023.}

The following table reconciles operating income to net operating income, a non-GAAP measure, for the three months and years ended December 31, 2024, and 2023.

^{(1) Includes Allied's proportionate share of the equity accounted investment of the following amounts for the three months and year ended December 31, 2024: amortization improvement allowances of $189 and $778, respectively (December 31, 2023 - $169 and $660, respectively,) and amortization of straight-line rent of $(38) and $(190), respectively (December 31, 2023 - $(43) and $(190), respectively).
(2) Excludes the Urban Data Centre segment which was classified as a discontinued operation from Q4 2022 until its disposition in August 2023. For the three months and year ended December 31, 2023, the Urban Data Centre segment's amortization of improvement allowances was $nil and $326, respectively and the amortization of straight-line rent was $nil and $(695), respectively.}

Same Asset NOI, a non-GAAP measure, is measured as the net operating income for the properties that Allied owned and operated for the entire duration of both the current and comparative period.

^{(1) Includes Allied's 50% interest in 19 Duncan.
(2) Includes 100% of 400 West Georgia, Allied's incremental 50% interest in 19 Duncan, and Allied's incremental 16.7% interest in the residential component of TELUS Sky acquired in 2024.}

^{(1) Includes Allied's 50% interest in 19 Duncan.
(2) Includes 100% of 400 West Georgia, Allied's incremental 50% interest in 19 Duncan, and Allied's 16.7% interest in the residential component of TELUS Sky acquired in 2024.}

The following tables reconcile Allied's net loss and comprehensive loss from continuing operations to FFO, FFO excluding condominium-related items, financing prepayment costs, and the mark-to-market adjustment on unit-based compensation, AFFO, and AFFO excluding condominium-related items, financing prepayment costs, and the mark-to-market adjustment on unit-based compensation, which are non-GAAP measures, for the three months and years ended December 31, 2024, and 2023.

^{(1) Property, plant and equipment relates to owner-occupied property.
(2) This amount represents interest expense on Allied's joint venture investment in TELUS Sky and is not capitalized under IFRS, but is allowed as an adjustment under REALPAC's definition of FFO in "Funds From Operations (FFO) & Adjusted Funds From Operations (AFFO) for IFRS" issued in January 2022.
(3) The weighted average number of units includes Units and Exchangeable LP Units. The Exchangeable LP Units were reclassified from non-controlling interests in equity to liabilities in the consolidated financial statements on Allied's conversion to an open-end trust on June 12, 2023.}

^{(1) Property, plant and equipment relates to owner-occupied property.
(2) This amount represents interest expense on Allied's joint venture investment in TELUS Sky and is not capitalized under IFRS, but is allowed as an adjustment under REALPAC's definition of FFO in "Funds From Operations (FFO) & Adjusted Funds From Operations (AFFO) for IFRS" issued in January 2022.
(3) The weighted average number of units includes Units and Exchangeable LP Units. The Exchangeable LP Units were reclassified from non-controlling interests in equity to liabilities in the consolidated financial statements on Allied's conversion to an open-end trust on June 12, 2023.}

Cautionary Statements

This press release may contain forward-looking statements with respect to Allied, its operations, strategy, financial performance and condition, and the assumptions underlying any of the foregoing. These statements generally can be identified by the use of forward-looking words such as “forecast”, “goals”, “outlook”, “may”, “will”, “expect”, “estimate”, “anticipate”, “intends”, “believe”, “assume”, “plans” or “continue” or the negative thereof or similar variations. The forward-looking statements in this press release are not guarantees of future results, operations or performance and are based on estimates and assumptions that are subject to risks and uncertainties, including those described under “Risks and Uncertainties” in Allied’s Annual MD&A, which is available at www.sedarplus.ca. Those risks and uncertainties include risks associated with financing and interest rates, access to capital, general economic conditions and joint arrangements and partnerships. Allied’s actual results and performance discussed herein could differ materially from those expressed or implied by such statements. These cautionary statements qualify all forward-looking statements attributable to Allied and persons acting on its behalf. All forward-looking statements speak only as of the date of this press release and, except as required by applicable law, Allied has no obligation to update such statements.

About Allied

Allied is a leading owner-operator of distinctive urban workspace in Canada’s major cities. Allied’s mission is to provide knowledge-based organizations with workspace that is sustainable and conducive to human wellness, creativity, connectivity and diversity. Allied’s vision is to make a continuous contribution to cities and culture that elevates and inspires the humanity in all people.

FOR FURTHER INFORMATION, PLEASE CONTACT:

Cecilia C. Williams
President & Chief Executive Officer
(416) 977-9002
cwilliams@alliedreit.com

Nanthini Mahalingam
Senior Vice President & Chief Financial Officer
(416) 977-9002
nmahalingam@alliedreit.com