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Highlights

  • Industrial Same Property NOI rose 2.8% year-over-year to CAD 28.5 million.
  • Completed 395,412 sq. ft. of leasing at 38% average rent spread.
  • Advanced two projects adding CAD 6.6 million annual stabilized NOI upon completion.

Nexus Industrial REIT (TSX: NXR.UN) reported its financial results for the second quarter ended June 30, 2025, marking its first quarter as a pure-play industrial REIT. The REIT’s normalized funds from operations (FFO) per unit increased 5.6% year-over-year to CAD 0.188, while normalized adjusted funds from operations (AFFO) per unit rose to CAD 0.160 from CAD 0.149.

Net operating income (NOI) for the quarter grew 1.7% from the prior year to CAD 32.2 million, driven by acquisitions of tenanted income-producing industrial properties and growth in industrial Same Property NOI, despite selling 33 legacy retail, office, and non-core industrial assets. Industrial Same Property NOI increased 2.8% year-over-year to CAD 28.5 million.

The quarter’s net loss of CAD 7.6 million was attributed to fair value losses on Class B LP units and investment properties, partially offset by NOI and fair value gains on derivative instruments.

During Q2 2025, the REIT advanced construction on two development projects: a 325,000 sq. ft. expansion in St. Thomas, Ontario, and a 115,000 sq. ft. small-bay complex in Calgary, Alberta. Together, these are expected to generate CAD 6.6 million in annual stabilized NOI upon completion, planned for the third quarter of 2025.

Leasing activity in the quarter covered 395,412 sq. ft. at an average spread of 38% over expiring and in-place rents. The REIT also completed the sale of two non-core industrial properties for total proceeds of CAD 11.2 million.

For the year to date, Nexus finalized its transition to a fully industrial-focused portfolio through the sale of 15 retail properties, one office property, and two industrial properties, generating CAD 62.1 million in proceeds. Leasing volume for the first half of 2025 reached 1,192,792 sq. ft., with an average rent spread of 82% over prior leases.

Management stated that the REIT is approaching completion of both industrial developments ahead of schedule, with expected contributions to income beginning later this year.