Power REIT (AMEX:PW) provided an update that includes highlights of the Trust’s financial and operating results for the three and twelve months ended December 31, 2021.
Q4 Financial Highlights
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Revenue of $1,785,809 for the Q4 of 2021, up 28% compared to $1,394,613 for the same quarter last year.
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Net Income Attributable to Common Shareholders was $670,730 for the Q4 of 2021, down 22% compared to $863,970 for the same quarter last year.
Financial Highlights for the Year Ending December 31, 2021
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Revenue of $8,457,914 in 2021, up 98% compared to $4,272,709 in 2020.
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Net Income Attributable to Common Shareholders was $4,491,656 in 2021, up 137% compared to $1,891,644 in 2020.
During the year, Power REIT deployed all of the approximately $37 million of capital raised in the rights offering which was completed in February 2021. During the fourth quarter of 2021, the Trust reported a quarterly FFO per share of $0.35. During the fourth quarter, the Trust recorded two one-time write-offs for the termination of leases with Cloud Nine LLC and The Grail Project LLC. Additionally, straight-line rent for the Michigan property starting in Q4 2021 was omitted from straight-line rent and created a one-time write-off to adjust for the straight-line that was recorded during the third quarter of 2021. These three one-time adjustments combined reduced FFO by $0.16 per share.
Commenting on the Trust’s financial and operating results, David Lesser, CEO stated, “From an earnings perspective, we increased our core FFO per common share by 44% year over year. We remain confident in our long-term strategy that greenhouses provide the most economically and environmentally sustainable path for cultivation and focused on managing our existing portfolio in lockstep with accretive acquisitions.”
Portfolio
Power REIT’s portfolio currently comprises:
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21 Controlled Environment Agriculture properties (greenhouses) totaling more than 1,000,000 square feet;
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7 solar farm ground leases totaling 601 acres
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112 miles of railroad property.
During 2021 the Trust acquired 9 greenhouse properties at an average unlevered yield of approximately 18%. This is indicative of the current market conditions where the Trust seeks to acquire and expand its greenhouse portfolio.
Strategic Alliance
In 2021, Power REIT embarked on a strategic alliance with Millennium Sustainable Ventures Corp. (OTCPK:MILC). The goal of the strategic alliance was to create a more scalable operating and acquisition platform between the two public companies of which David Lesser is CEO.
Capital markets activity
Cash and cash equivalents totaled approximately $3.2 million as of December 31, 2021, a decrease of approximately 2.4 million from December 31, 2020. The primary use of cash was for working capital requirements and investment activities including $30.9 million paid for land and greenhouse cultivation facilities with $11.2 paid for construction and improvements for these facilities.
On December 21, 2021, Power REIT obtained a $20 million debt facility which has a 12-month draw period before converting to a five-year term loan. The interest rate on the debt facility is 5.42%, which creates a meaningful investment spread based on the yields Power REIT is investing at.
On June 21, 2021, the SEC declared Power REIT’s shelf registration effective. Power REIT continues to focus on non-dilutive capital to fund its growth including debt alternatives and potentially the issuance of preferred stock.
On February 5, 2021, Power REIT closed on its rights offering, generating proceeds of approximately $37 million and issued an additional 1,383,394 common shares. Through this investor-friendly, shareholders of record as of December 28, 2020, were offered the opportunity to purchase additional shares at $26.50 per share
On February 3, 2021, Power REIT issued 192,308 additional shares of Power REIT’s series A preferred stock as part of a transaction to acquire a property located in Riverside County, CA through a newly formed wholly-owned subsidiary “PW Canndescent.”
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