Dream Office REIT Provides Business Update - Seite 2

For the remaining May rents that are either uncollected or no special arrangements made with tenants, our tenant relations team has been in active discussions with these particular tenants who are currently in arrears and we anticipate collecting the majority of the remaining rents in the near term.

Meanwhile, the REIT is working actively with various organizations to help support our local community during the pandemic. We have partnered with WoodGreen Community Services to provide financial donations and emergency food and toiletry packages for vulnerable seniors and families within the community. We have also offered our unused parking spaces in downtown Toronto free of charge to hospital workers and first responders to help combat the COVID-19 pandemic.

CAPITAL PLAN UPDATE

With the ever-evolving tenant needs and economic uncertainty in light of the COVID-19 pandemic, we have conducted a detailed review of our planned capital expenditures this year. Through the review, we have identified over $10 million of capital expenditures for 2020 that can be deferred into future years and will not impact the value or income of our assets.

We remain committed to investing in our Dream Collection – Financial District in Toronto as we believe these assets will play an integral part to the path of recovery post COVID-19 and provide a strong return on capital investments. Construction has resumed and we estimate that over 50% of the project is in various stages of construction, tendering and award, with an anticipated completion date in the first half of 2021.  

In addition, we are continuing work on our redevelopment projects at 357 Bay Street in Toronto and at Sherwood Place in Saskatoon as our tenants will commence their lease in the second half of 2020 and 2021, respectively.

PORTFOLIO WELL POSITIONED IN THE POST COVID-19 WORLD

Despite market uncertainty and changing tenant behaviours, we believe our portfolio is well positioned to withstand the changing needs of office space post-COVID.

	1)	Smaller Floor Plates: The average floor plate in our portfolio is 14,000 square feet and we have nine buildings with floor plates of less than 7,000 square feet. These smaller floor plates would provide prospective tenants with an opportunity to lease the entire floor, minimizing the sharing of washrooms or physical interactions with other tenants.
	2)	Elevator Modernization: We have fully modernized 44% of the elevators in the Toronto Downtown and the Greater Toronto Area with 50% scheduled for upgrade over the next five years. This will help improve tenant flow and reduce wait times in elevator lobbies.
	3)	Medium Rise Buildings: The average building height across our portfolio is only 14 floors. Therefore, our tenants would have a shorter wait and ride time at our buildings compared to high-rise buildings.
	4)	HVAC & Other Building Improvements: The REIT is following all Public Health, ASHRAE and BOMA recommendations with regards to operating building HVAC systems. In recent years, we have made significant investments into air filtration systems for all of the REIT’s buildings and we are exploring further improvements in HVAC systems such as portable filters and air purifiers in elevators to minimize the risk of COVID-19 spread. We are also investigating the installation of thermal cameras at entrances, anti-microbial door handles, and other safety improvements.

We are looking forward to welcoming our tenants and employees back to our offices as regional governmental restrictions are lifted. To keep our tenants and employees safe and healthy, we have made a number of changes to our buildings, both visible and behind the scenes. To promote physical distancing, building lobbies have separate entry and exit points and unidirectional traffic flows. As tenants enter our buildings, they will be greeted with hand sanitizer stations and clear signage to help them move safely. We also have frequent enhanced cleaning in high touchpoint areas to help mitigate the risk of spreading disease. In addition, to minimize outside visitor traffic flow within our buildings, we have introduced designated courier drop-off points.