Morguard Real Estate Investment Trust Announces Q1 2008 Results

May 1, 2008


    MISSISSAUGA, ON, May 1 /CNW/ - Morguard Real Estate Investment Trust
("Morguard REIT") (TSX: MRT.UN) today announced its financial results for the
three-month period ended March 31, 2008.
    Morguard REIT's Q1 2008 Financial Statements, and Management's Discussion
and Analysis along with its 2007 Annual Report are available on Morguard
REIT's website at www.morguardreit.com and have been filed with SEDAR at
www.sedar.com.

    HIGHLIGHTS-   Net operating income for Q1 2008 increased to $27.8 million from
        $26.2 million for the same period in 2007;
    -   Net income for Q1 2008 totaled $45.3 million or $0.77 per unit
        compared to $7.8 million or $0.13 per unit for the same period in
        2007. Included in net income for Q1 2008 was a gain on sale of real
        estate properties of $37.0 million;
    -   Recurring distributable income for Q1 2008 increased to $16.4 million
        or $0.28 per unit compared to $14.2 million or $0.24 per unit (fully
        diluted) for the same period in 2007;
    -   Funds from operations ("FFO") for Q1 2008 increased to $18.5 million
        or $0.31 per unit compared to $16.2 million or $0.27 per unit for the
        same period in 2007;
    -   Overall occupancy levels for 2008 remains high and stable at 95%
        compared with 94% in Q1 2007.

    FINANCIAL HIGHLIGHTS

    Net Income
    ----------

    (In thousands of dollars except per unit amounts)

    Three-month period ended March 31,                      2008        2007
    -------------------------------------------------------------------------

    Income from real estate properties                 $  50,774   $  47,898
    Net operating income                               $  27,805   $  26,236

    Net income from continuing operations              $  45,849   $   6,322
    Income from discontinued operations                     (563)      1,440
    -------------------------------------------------------------------------
    Net income                                         $  45,286   $   7,762
                                                      -----------------------
                                                      -----------------------

    Net income per unit (basic and diluted)
      Continuing operations                            $    0.78   $    0.11
      Discontinued operations                              (0.01)       0.02
    -------------------------------------------------------------------------
                                                       $    0.77   $    0.13
                                                      -----------------------
                                                      -----------------------Distributable Income
    --------------------
    The Trust distributes a portion of its net income after adjusting for
amortization of buildings and intangible assets, and providing for any reserve
that the Trustees, in their discretion, consider reasonable. The adjusted net
income is referred to as distributable income and is computed as income, in
accordance with Canadian GAAP, before deduction for amortization of buildings
and intangible assets, less any reserves, provisions and allowances
established by the Trustees, plus any amount the Trustees, in their
discretion, determine to be appropriate.
    Recurring distributable income is distributable income excluding gain on
sales, unusual or non-recurring items and provisions for a diminution in value
of real estate properties.
    The following table outlines the Trust's distributable income, recurring
distributable income and payout ratios for the period ended March 31, 2008 and
2007.(In thousands of dollars except per-unit amounts and percentages)

    Three-month period ended March 31,                      2008        2007
    -------------------------------------------------------------------------

    Net income                                         $  45,286   $   7,762
    -------------------------------------------------------------------------

    Add (deduct)
    Stepped rents - straight-line adjustment                (113)       (405)
    Amortization - buildings                               5,475       5,310
    Amortization - intangibles                             2,021       1,503
    Amortization - above/(below) market rate leases, net    (286)       (198)
    -------------------------------------------------------------------------

    Distributable income                                  52,383      13,972
    Gain on sale of real estate properties               (36,408)          -
    Cost of early extinguishment of mortgage
     bonds payable                                             -         242
    Provision for diminution in value of real
     estate properties                                       400           -
    -------------------------------------------------------------------------

    Recurring distributable income                     $  16,375   $  14,214
                                                      -----------------------
                                                      -----------------------

    Distributed income                                 $  13,286   $  13,287
                                                      -----------------------
                                                      -----------------------

    Payout ratio:
      Recurring distributable income                        81.1%       93.5%

    Recurring distributable income - basic
     and diluted                                       $    0.28   $    0.24

    Weighted average number of units - basic
     and diluted (in thousands)                           59,044      59,050
                                                      -----------------------
                                                      -----------------------Funds from Operations
    ---------------------
    The real estate industry has adopted a measure of funds from operations
("FFO") to supplement net income as an operating performance measurement. The
Trust's calculation of FFO is consistent with the definition provided by the
Real Property Association of Canada ("REALPac").
    FFO is defined as net income adjusted for amortization of buildings,
deferred leasing costs, intangible items and any gain or loss on sale of real
estate properties and any provisions against capital. FFO per unit is
calculated by dividing FFO attributable to unitholders by the weighted average
number of units outstanding for the year.FFO was calculated as follows:

    (In thousands of dollars except per-unit amounts)

    Three-month
     period ended       March 31, 2008                 March 31, 2007
               --------------------------------------------------------------

                Continuing Discontinued        Continuing Discontinued
                Operations Operations   Total  Operations Operations   Total
    -------------------------------------------------------------------------
    Net income     $45,849   $  (563)  $45,286   $ 6,322   $ 1,440   $ 7,762

    Add (deduct)
     items not
     affecting cash:
    (Gain)/Loss on
     sale of real
     estate
     properties    (37,023)      615   (36,408)        -         -         -
    Provision for
     diminution in
     value of real
     estate
     properties          -       400       400         -         -         -
    Amortization -
     buildings       5,475         -     5,475     5,145       165     5,310
    Amortization -
     leasehold
     improvements    1,325         -     1,325     1,227        11     1,238
    Amortization -
     intangibles     2,021         -     2,021     1,496         -     1,496
    Amortization -
     leasing costs     450         -       450       391         7       398
    -------------------------------------------------------------------------
    Funds from
     operations    $18,097   $   452   $18,549   $14,581   $ 1,623   $16,204
                  -----------------------------------------------------------
                  -----------------------------------------------------------

    Funds from
     operations
     per unit:
      Basic and
       diluted     $  0.30   $  0.01   $  0.31   $  0.25   $  0.02   $  0.27
                  -----------------------------------------------------------
                  -----------------------------------------------------------Readers are cautioned that although the terms "Operating Income", "Funds
from Operations", "Distributable Income" and "Recurring Distributable Income"
are commonly used to measure, compare and explain the operating and financial
performance of Canadian real estate investment trusts and such terms are
defined in the Management's Discussion and Analysis, such terms are not
recognized terms under Canadian generally accepted accounting principles. Such
terms do not necessarily have a standardized meaning and may not be comparable
to similarly titled measures presented by the other publicly traded entities.

    Morguard is a closed-end real estate investment trust, which owns a
diversified portfolio of 50 retail, office, and industrial properties in
Canada with a book value of $1.2 billion and approximately 7.6 million square
feet of leasable space. For more information, visit the Trust's website at
www.morguardreit.com.




For further information:

For further information: Rai Sahi, President and Chief Executive
Officer, Tel: (905) 281-4800; or Tim Walker, Vice President and Chief
Financial Officer, Tel: (905) 281-4800