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  • Unaudited Condensed Consolidated Financial Statements and Notes

    For the three and six months ended June 30, 2017 and 2016

  • Northview Second Quarter 2017 2

    Northview Apartment Real Estate Investment Trust Unaudited Condensed Consolidated Statements of Financial Position (thousands of Canadian dollars)

    Note June 30, 2017 December 31, 2016

    Assets

    Non-current assets

    Investment properties 3 3,162,361 3,059,825

    Property, plant and equipment 4 43,675 40,282

    Investment in joint ventures 6,437 6,274

    Other long-term assets 5,818 6,150

    Loans receivable 2,007 2,190

    3,220,298 3,114,721

    Current assets

    Assets held for sale 16 25,212 39,873

    Accounts receivable 11(b)(ii) 10,599 9,428

    Restricted cash 11,541 11,254

    Cash 9,202 4,148

    Prepaid expenses and other assets 8,272 3,187

    Loans receivable 2,750 3,061

    67,576 70,951

    Total Assets 3,287,874 3,185,672

    Liabilities

    Non-current liabilities

    Mortgages payable 5 1,457,934 1,500,688

    Class B LP Units 9(b) 122,340 116,701

    Credit facilities 7 79,699 65,829

    Convertible debentures 6 24,127 23,460

    Unit based payments 11(a) 1,242 1,733

    1,685,342 1,708,411

    Current liabilities

    Mortgages payable 5 204,333 160,844

    Credit facilities

    7 79,108 68,013

    Trade and other payables 62,599 68,106

    Distributions and Class B LP interest payable 7,573 7,571

    Liabilities related to assets held for sale 16 10,117 18,008

    Derivative instruments 5 1,228 1,499

    Unit based payments 11(a) 1,369 -

    366,327 324,041

    Total Liabilities 2,051,669 2,032,452

    Unitholders equity

    Equity attributable to Unitholders 1,235,118 1,152,010

    Non-controlling interests 1,087 1,210

    Total Equity 1,236,205 1,153,220

    Total Liabilities and Equity 3,287,874 3,185,672

    See accompanying notes to the condensed consolidated financial statements.

  • Northview Second Quarter 2017 3

    Northview Apartment Real Estate Investment Trust Unaudited Condensed Consolidated Statements of Net and Comprehensive Income (Loss)

    Three and six months ended June 30 (thousands of Canadian dollars)

    Three months ended Six months ended

    Note 2017 2016 2017 2016

    Revenue

    Rental revenue 79,344 77,411 157,544 156,917

    Other revenue 3,085 3,701 5,834 10,502

    82,429 81,112 163,378 167,419

    Operating expenses 33,760 36,782 72,371 76,106

    Net operating income 48,669 44,330 91,007 91,313

    Other expense (income)

    Financing costs 13 16,542 17,705 33,487 34,948

    Administration 3,879 2,308 7,140 4,972

    Depreciation and amortization 1,179 1,224 2,354 2,658

    (Gain) loss on sale of properties (28) 66 661 65

    Equity income from joint ventures (70) (77) (263) (382)

    Business combination transaction costs - 332 - 14,448

    Fair value (gain) loss 14 (96,570) 27,051 (76,043) 34,402

    (75,068) 48,609 (32,664) 91,111

    Net and comprehensive income (loss) 123,737 (4,279) 123,671 202

    Net and comprehensive income (loss) attributable to:

    Unitholders 123,699 (4,239) 123,601 195

    Non-controlling interests 38 (40) 70 7

    Net and comprehensive income (loss) 123,737 (4,279) 123,671 202

    See accompanying notes to the condensed consolidated financial statements.

  • Northview Second Quarter 2017 4

    Northview Apartment Real Estate Investment Trust Unaudited Condensed Consolidated Statements of Changes in Unitholders Equity

    Six months ended June 30 (thousands of Canadian dollars)

    Note 2017 2016

    Units

    Balance, January 1 1,157,774 1,053,626

    Long-term incentive plan units issued 9 47 11

    Units issued, net of issuance costs 9 157 31,300

    Balance, June 30 1,157,978 1,084,937

    Retained earnings

    Cumulative net income

    Balance, January 1 360,089 282,804

    Net and comprehensive income attributable to Unitholders 123,601 195

    Balance, June 30 483,690 282,999

    Cumulative distributions to Unitholders

    Balance, January 1 (365,853) (289,134)

    Distributions declared to Unitholders (40,697) (37,486)

    Balance, June 30 (406,550) (326,620)

    Cumulative retained earnings (deficit), June 30 77,140 (43,621)

    Equity attributable to Unitholders 1,235,118 1,041,316

    Non-controlling interests

    Balance, January 1 1,210 1,810

    Net and comprehensive income 70 7

    Distributions to non-controlling interests (193) (58)

    Balance, June 30 1,087 1,759

    Total Unitholders equity 1,236,205 1,043,075

    See accompanying notes to the condensed consolidated financial statements.

  • Northview Second Quarter 2017 5

    Northview Apartment Real Estate Investment Trust Unaudited Condensed Consolidated Statements of Cash Flows

    Three and six months ended June 30 (thousands of Canadian dollars)

    Three months ended Six months ended

    Note 2017 2016 2017 2016

    Operating activities:

    Net and comprehensive income (loss) 123,737 (4,279) 123,671 202

    Adjustments:

    Fair value (gain) loss 14 (96,570) 27,051 (76,043) 34,402

    Depreciation and amortization 1,179 1,224 2,354 2,658

    Mortgage and credit facilities interest expense 13,997 15,286 28,277 29,505

    Mortgage and credit facilities interest paid (14,384) (14,833) (28,999) (29,504)

    Interest expense to Class B LP Unitholders 2,369 2,403 4,738 5,066

    Distribution interest paid to Class B LP Unitholders 9(c) (2,369) (2,403) (4,738) (5,325)

    Interest expense on convertible debentures 330 348 656 678

    Interest paid on convertible debentures (656) (660) (656) (660)

    (Gain) loss on sale of properties (28) 66 661 65

    Equity income from joint ventures (70) (77) (263) (382)

    Long-term incentive plan compensation 723 211 905 491

    Changes in non-cash working capital 15 (6,330) (4,608) (11,669) 3,337

    Cash provided by operating activities 21,928 19,729 38,894 40,533

    Financing activities:

    Proceeds from mortgages 19,887 29,964 38,094 383,962

    Repayment of mortgages (16,529) (35,530) (47,599) (55,836)

    Borrowing (repayment) of credit facilities, net 19,656 31,596 27,965 (284,347)

    Distributions paid to Unitholders 9(c) (20,350) (18,872) (40,697) (37,224)

    Proceeds from unit issuance, net 157 - 157 -

    Distributions to non-controlling interests (164) (29) (193) (58)

    Cash provided by (used in) investing activities 2,657 7,129 (22,273) 6,497

    Investing activities:

    Acquisition of investment properties and land for future development 3 - (135) - (141)

    Capital expenditures on investment properties under development 3 (4,539) (12,629) (6,582) (24,093)

    Capital expenditures on investment properties 3 (13,190) (11,484) (24,140) (22,652)

    Proceeds from sale of assets and investment properties, net 80 702 22,968 703

    Acquisition of property, plant and equipment 4 (2,732) (1,297) (4,165) (2,326)

    Distributions received from equity investees 50 42 100 85

    Changes in non-cash working capital 15 591 229 252 92

    Cash used in financing activities (19,740) (24,572) (11,567) (48,332)

    Net increase (decrease) in cash 4,845 2,286 5,054 (1,302)

    Cash, beginning of period 4,357 899 4,148 4,487

    Cash, end of period 9,202 3,185 9,202 3,185

    See accompanying notes to the condensed consolidated financial statements.

  • Northview Apartment Real Estate Investment Trust Notes to the Unaudited Condensed Consolidated Financial Statements Three months and six months ended June 30, 2017 and 2016 (Tabular amounts expressed in thousands of Canadian dollars except where indicated)

    Northview Second Quarter 2017 6

    1. Description of the consolidated entities Northview Apartment Real Estate Investment Trust (Northview) (formerly Northern Property Real Estate Investment Trust (NPR)) is an unincorporated, open-ended real estate investment trust created pursuant to a declaration of trust (DOT) dated January 2, 2002, and last amended May 5, 2016, under the laws of the Province of Alberta (and the federal laws of Canada applicable therein). Northview is primarily a multi-family residential real estate investor and operator, providing a broad spectrum of rental accommodations with a portfolio of approximately 24,000 quality residential suites in more than 60 markets across eight provinces and two territories. Northviews registered office is located at 200, 6131 6th Street SE, Calgary, Alberta. Northview is listed on the Toronto Stock Exchange (TSX) under the symbol NVU.UN. Northview is a real estate investment trust for tax purposes.

    2. Significant accounting policies a) Basis of preparation and statement of compliance These condensed consolidated financial statements have been prepared in accordance with International Accounting Standard (IAS) 34 Interim Financial Reporting, using accounting policies consistent with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

    These condensed consolidated financial statements should be read in conjunction with Northviews annual financial statements for the year ended December 31, 2016, prepared in accordance with IFRS. There have been no changes to Northviews accounting policies from those disclos

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