CSH.UN: Making new friends

Research evidence excerpt

CSH.UN: Making new friends

Unit 0.77 0.98 1.15 1.26

bps YoY). The benefits of CSH’s improved operating strategies are clearly Prev. 1.13 1.24

surfacing, with further anticipated advances from the rollout of its new P/FFO 28.2x 22.2x 18.8x 17.2x

sales commission structure focused on maintaining market rates and more AFFO/Unit 0.71 0.89 1.04 1.14

P/AFFO 30.4x 24.2x 20.8x 18.9x effective waitlist management. In short, we see high-single to low double- Distribution/Unit 0.61 0.61 0.62 0.64

digit organic NOI growth as achievable this year, with additional upside Payout Ratio 86% 68% 60% 56%

from the rest of the portfolio (40% of suites, 91.5% occupied).

FFO/Unit Q1 Q2 Q3 Q4

Pushing portfolio quality up the curve, with help from $1.3B Fengate JV. 2025 0.21A 0.24A 0.25A 0.27A 2026 0.27A 0.28E 0.30E 0.30E

CSH has completed $435MM of YTD acquisitions, including the previously Prev. 0.25E

announced Sifton portfolio. It also agreed to acquire a 30% interest

in a retirement portfolio (“Seasons”) via a new JV with Fengate for AllPricedvaluesas ofin priorCAD unlesstradingotherwiseday's marketnoted.close, EST (unless otherwise noted).

$383MM ($433K/suite). We see multiple benefits to the deal, including

a complementary portfolio of larger, more efficient properties in its core

markets (average 13-years old), modest earnings accretion (high-5% going-

in cap rate/low-6% stabilized), access to future growth via the option to

acquire an additional 20% stake and future developments, and leveraging

its platform to earn property management fees. We expect funding

from $235MM of non-core asset sales (including $118MM ON retirement

portfolio at mid-7% cap, with average age >30 years), ATM equity, and debt.

Estimates raised. Our 26E/27E FFOPU rise to $1.15 (+$0.02)/$1.26 (+$0.02)