Retrocom REIT Announces First Quarter 2012 Results

TORONTO, ONTARIO--(Marketwire - May 10, 2012) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR TO ANY NON-CANADIAN SOURCE

Retrocom Mid-Market Real Estate Investment Trust (the "REIT") (TSX:RMM.UN) today announced results for the first quarter ended March 31, 2012.

Highlights

• Net operating income increased by $1.2 million or 13.0% in the three month period ending March 31, 2012 over the comparable period last year.
• Funds from Operations ("FFO") increased by $2.0 million for the three months ending March 31, 2012, or 65% over the comparable period last year.
• Debt to Gross Book Value ratio as at March 31, 2012 has decreased to 54.4% from 56.7% at March 31, 2011.
• Raised $29 million on February 3, 2012 through public offering of trust units.
• Refinanced mortgage debt of $7.4 million with a new mortgage of $10.0 million resulting in a 361 basis point decrease in the interest rate.
• Completed lease renewals and amendments on 360,000 square feet and new leases on 201,000 square feet.
• In place occupancy on March 31, 2012 was 87.6% and committed occupancy was 88.3%.
• Reached an agreement to increase our line of credit to $28.0 million with a new maturity date of June 30, 2014, at substantially improved terms and conditions.

Operational and Financial Summary

• Net operating income ("NOI") for Q1, 2012 was $10.6 million, which increased by $1.2 million or 13.0% over the comparable period last year. The increase is attributable to the acquisitions made in the second quarter of 2011 and same property growth of over 3.0%.
• FFO for Q1, 2012 was $5.0 million ($0.105 per unit), as compared to $3.0 million ($0.088 per unit). FFO increased by $2.0 million, or 65% reflecting both portfolio performance and the effects of lower interest rates.
• The REIT's average cost of mortgage debt was 5.48% at the end of Q1, 2012 as compared to 5.58% at the end of 2011 and 5.84% at the end of Q1, 2011.
• The portfolio occupancy rate was 87.6% as at March 31, 2012, compared to 86.0% at 2011 year end.
• The REIT retains a solid liquidity position with approximately $29.0 million cash on hand.

Richard Michaeloff, President and CEO of the REIT, said, "In this first quarter of 2012, we continue to build momentum with improved operating results and increased occupancy."

Financial Highlights
		Three months ended Mar 31			Three months ended Mar 31
(all amounts in $000's, except per unit amounts and ratios)		2012			2011
Rental revenue and other income			19,982			18,737
Property operating expenses			9,520			9,335
Net operating income (1)			10,462			9,402
Share of joint venture net operating income			171			-
Total net operating income			10,633			9,402
Trust expenses			919			1,084
Finance costs-operations			4,749			5,260
Finance costs-distributions on Class B Units			1,025			1,025
Income before income taxes and fair value gains (losses)			3,940			2,033
Fair value losses associated with finance costs			(1,682	)		(7,468	)
Fair value losses on investment property			(917	)		(254	)
Fair value gains (losses) on participant's rights under LTIP			9			(56	)
Fair value loss on joint venture property			(109	)		-
Loss from sale of investment property			(105	)		-
Income (loss) for the period			1,136			(5,745	)
FFO (2)			5,007			3,025
FFO
	Basic	$	0.105		$	0.088
	Diluted	$	0.105		$	0.088
FFO payout ratio			102.7	%		134.2	%
Distributions (3)			5,143			4,060

Full Financial Results and MD&A will be available on SEDAR (www.sedar.com) as well as the Investors Relations section of the REIT's website (www.rmmreit.com).

(1)	A non-IFRS measurement, calculated by the REIT as rental revenue (net rents, property tax and operating cost recoveries, as well as other miscellaneous income from tenants) less operating expenses for properties.
(2)	The reconciliations from net income (loss) to Funds from Operations are included in the REIT's MD&A.
(3)	Distributions include distributions on Class B Units of Retrocom LP.

The REIT's management considers Net Operating Income, Funds from Operations, Funds from Operations, adjusted, and Debt to Gross Book Value ratio to be indicative measures in evaluating the REIT's performance. The table above includes non-IFRS information that should not be construed as an alternative to net income or cash flows from operations and may not be comparable to similar measures presented by other issuers as there is no standardized meaning prescribed by IFRS.

Conference Call

Retrocom REIT will hold a conference call on Friday, May 11, 2012 at 10:00 am (ET). Participating on the call will be members of the REIT's senior management.

Investors are invited to access the call by dialling 416-644-3417 or 1-877-974-0446. You will be required to identify yourself and the organization on whose behalf you are participating. A recording of this call will be made available Friday, May 11, 2012 beginning around 12:00 pm (ET) through to Friday, May 25, 2012. To access the recording, please call 416-640-1917 or 1-877-289-8525 and use the reservation number 4535019#.

About Retrocom REIT

Retrocom REIT is an unincorporated, open-end real estate investment trust which focuses on owning and acquiring retail properties across Canada with the goal of enhancing long-term Unitholder value.

Forward-Looking Information

This press release may contain forward-looking statements. In some cases, forward-looking statements can be identified by the use of words such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", and by discussions of strategies that involve risks and uncertainties. The forward-looking statements are based on certain key expectations and assumptions made by the REIT. By their nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. Although management of the REIT believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that future results, levels of activity, performance or achievements will occur as anticipated. Neither the REIT nor any other person assumes responsibility for the accuracy and completeness of any forward-looking statements, and no one has any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or such other factors which affect this information, except as required by law.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, which may be made only by means of a prospectus, nor shall there be any sale of the Units in any state, province or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under securities laws of any such state, province or other jurisdiction. The Units of the REIT have not been, and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or delivered in the United States absent registration or an application for exemption from the registration requirements of U.S. securities laws.