Core Insights - CAPREIT is focusing on a portfolio mix aimed at reducing capital needs and enhancing resilience, with 79% of assets classified as value-add and 68% as core long-term holdings [1] - The company has engaged in significant buybacks, spending CAD 294 million in 2025 at an average price of CAD 41, while the NAV per unit was reported at CAD 56 [2] - CAPREIT successfully met its 2025 disposition target by selling over CAD 400 million in non-core Canadian assets and CAD 784 million in European interests, using proceeds to acquire CAD 659 million in strategically aligned properties [3][7] Portfolio Repositioning - The company completed a major portfolio repositioning in 2025, selling non-core assets and acquiring targeted properties to lower average age and operating costs [7] - CAPREIT's allocation to newly constructed properties is intentionally set at 19% to improve the portfolio's cost profile [7] Financial Performance - In Q4 2025, same-property revenue increased by 2.8% to CAD 224.4 million, with an NOI margin of 64.4% [5][12] - Diluted FFO per unit rose by 1.6% to CAD 0.632 in Q4, with a full-year FFO of CAD 2.541, reflecting lower interest costs and the impact of buybacks [13] - The same-property NOI margin for 2025 was 64.7%, up 50 basis points from 2024, supported by effective cost management [14] Market Conditions - The Canadian rental market is experiencing pressure from new supply and a pause in population growth, leading CAPREIT to implement targeted incentives and focus on resident retention [4][8] - Despite these challenges, occupancy remained high at 97.3% with average rent growth of 3.8% for 2025 [6][8] Turnover and Leasing Dynamics - Turnover among residents with leases under two years accounted for 48% of total turnover, with negative mark-to-market impacts, while those with longer tenures showed positive rent growth [19] - The blended rent uplift on turnover was +4.2% for 2025, indicating some resilience in pricing despite market pressures [9] Cost Management and Outlook - CAPREIT is focused on maintaining cost discipline through technology and procurement, with expected operating expense growth in 2026 aligning with inflation [17] - The company aims for 2% to 3% revenue growth, contingent on spring leasing season data, particularly in Ontario [16] Acquisition Strategy - CAPREIT remains open to acquisition opportunities, particularly joint ventures, in a market characterized by lower transaction volumes and stable cap rates [18]