UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2026
Commission File Number: 001-43491
BSR REAL ESTATE INVESTMENT TRUST
(Name of Registrant)
333 Bay Street, Suite 3400
Toronto, Ontario M5H 2S7
(501) 374-5050
(Address of Principal Executive Office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☐    Form 40-F ☒


FORM 6-K EXHIBIT INDEX
Exhibit No.
Description
99.1
99.2
99.3
99.4
99.5


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BSR REAL ESTATE INVESTMENT TRUST
Date: November 11, 2026
By:
/s/ Thomas M. Cirbus
Name:
Thomas M. Cirbus
Title:
Chief Financial Officer and Corporate Secretary



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BSR REAL ESTATE INVESTMENT TRUST
Condensed consolidated interim financial statements (In U.S. dollars)
For the three and nine months ended September 30, 2026 and September 30, 2025
(Unaudited)

BSR REAL ESTATE INVESTMENT TRUST
Condensed Consolidated Interim Statements of Financial Position (Unaudited)
In thousands of U.S. dollars
NoteSeptember 30, 2026December 31, 2025
Assets
Non-current assets
Investment properties8$1,375,502 $1,387,428 
Right-of-use asset171,105 1,195 
Interest rate derivatives19(d)1,445 598 
Prepayment embedded derivatives19(e)271 312 
1,378,323 1,389,533 
Current assets
Cash and cash equivalents4,061 6,344 
Restricted cash54,950 4,057 
Resident and other receivables, net64,116 3,798 
Note receivable— 5,227 
Interest rate derivatives19(d)3,341 453 
Prepaid expenses and other assets76,653 3,038 
Total assets$1,401,444 $1,412,450 
Liabilities and Unitholders' equity
Non-current liabilities
Loans and borrowings10$730,009 $694,381 
Interest rate derivatives19(d)— 397 
Lease liability171,041 1,110 
731,050 695,888 
Current liabilities
Accounts payable and other liabilities939,688 45,347 
Interest rate derivatives19(d)— 36 
Loans and borrowings10862 28,752 
Lease liability1791 88 
Class B Units1150,007 60,375 
Total liabilities$821,698 $830,486 
Unitholders' equity
Unitholders' equity13579,746 581,964 
Total liabilities and Unitholders' equity$1,401,444 $1,412,450 
See accompanying notes to condensed consolidated interim financial statements.
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BSR REAL ESTATE INVESTMENT TRUST
Condensed Consolidated Interim Statements of Net (Loss) Income and Comprehensive (Loss) Income (Unaudited)
In thousands of U.S. dollars
NoteThree months ended September 30, 2026Three months ended September 30, 2025Nine months ended September 30, 2026Nine months ended September 30, 2025
Revenue:
Rental revenue$29,891 $28,976 $89,315 $96,899 
Other property income4,629 4,118 13,235 13,368 
1434,520 33,094 102,550 110,267 
Expenses (Income):
Property operating expenses1510,875 10,435 31,566 33,646 
Real estate taxes(310)(424)25,111 30,037 
Real estate tax fair value adjustment under IFRIC 216,606 6,509 (5,760)(9,560)
Real estate tax refunds(387)(738)(1,644)(3,048)
General and administrative expenses3,297 2,223 8,942 7,484 
Fair value adjustment to investment properties820,929 6,510 22,002 9,440 
Finance costs from operations169,243 9,529 27,226 29,860 
Finance income from interest rate derivatives and note receivable(1,107)(2,017)(3,230)(7,351)
Costs of disposition of investment properties13 284 74 11,759 
Distributions on Class B Units16665 724 2,005 4,973 
Depreciation of right-of-use asset1730 — 90 33 
Fair value adjustment to derivatives and other financial liabilities16(6,688)(2,582)(13,365)63,718 
Fair value adjustment to unit-based compensation24(559)(233)(1,047)(271)
42,607 30,220 91,970 170,720 
Net (loss) income and comprehensive (loss) income $(8,087)$2,874 $10,580 $(60,453)
See accompanying notes to condensed consolidated interim financial statements.
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BSR REAL ESTATE INVESTMENT TRUST
Condensed Consolidated Interim Statements of Changes in Unitholders’ Equity (Unaudited)
In thousands of U.S. dollars
UnitsDistributionsCumulative
net income		Total
Unitholders'
Equity
Balance, as of January 1, 2025$376,959 $(96,198)$376,835 $657,596 
Net loss and comprehensive loss— — (60,453)(60,453)
Units issued, net of issuance costs (Note 13)1,060 — — 1,060 
Distributions— (14,078)— (14,078)
Balance, as of September 30, 2025$378,019 $(110,276)$316,382 $584,125 
Balance, as of January 1, 2026$382,847 $(114,989)$314,106 $581,964 
Net income and comprehensive income— — 10,580 10,580 
Units issued, net of issuance costs (Note 13)1,499 — — 1,499 
Distributions— (14,297)— (14,297)
Balance, as of September 30, 2026$384,346 $(129,286)$324,686 $579,746 
See accompanying notes to condensed consolidated interim financial statements.
3
BSR REAL ESTATE INVESTMENT TRUST
Condensed Consolidated Interim Statements of Cash Flows (Unaudited)
In thousands of U.S. dollars
NoteNine months ended
 September 30, 2026		Nine months ended
 September 30, 2025
Operating activities
Net income (loss) and comprehensive income (loss)$10,580 $(60,453)
Adjustments for:
Fair value adjustment to investment properties822,002 9,440 
Fair value adjustment to derivatives and other financial liabilities16(13,365)63,718 
Fair value adjustment to unit-based compensation24(1,047)(271)
Depreciation of right-of-use asset1790 33 
Unit-based compensation241,849 1,693 
Finance costs from operations1627,226 29,860 
Finance income from interest rate derivatives and note receivable(3,230)(7,351)
Costs of disposition of investment properties74 11,759 
Distributions on Class B Units162,005 4,973 
Change in non-cash operating assets and liabilities23(10,177)(8,515)
Cash provided by operating activities36,007 44,886 
Investing activities
Acquisition of investment properties4(a), 8— (287,312)
Net proceeds from sale of investment properties4(b), 8— 392,307 
Proceeds from note receivable5,227 — 
Additions to investment properties8(10,140)(9,673)
Restricted cash withdrawals, net of deposits5(128)1,483 
Cash (used in) provided by investing activities(5,041)96,805 
Financing activities
Proceeds from issuance of loans and borrowings1063,000 301,602 
Principal payments of loans and borrowings10(56,339)(362,169)
Payment of debt financing costs10(161)(1,908)
Principal payments of lease liability17(66)(36)
Redemption of Class B Units in exchange for cash11(756)(56)
Cash distributions paid to Class B Unitholders11(2,007)(5,676)
Cash distributions paid to Unitholders(14,302)(14,083)
Interest paid(27,160)(27,807)
Interest received from interest rate derivatives and note receivable3,209 7,719 
Cash received from interest rate swaption19(d)101 80 
Redemption of Convertible Debentures12— (41,499)
Cash used in financing activities(34,481)(143,833)
Change in cash and cash equivalents during the period(3,515)(2,142)
Cash and cash equivalents, beginning of period (prior to amendments to IFRS 9)6,344 — 
Adjustment on initial application of amendments to IFRS 91,232 — 
Cash and cash equivalents, beginning of period7,576 8,726 
Cash and cash equivalents, end of period$4,061 $6,584 
See accompanying notes to condensed consolidated interim financial statements.
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BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
j
(1)Description of the entity
BSR Real Estate Investment Trust (the “REIT”) is an unincorporated, open-ended real estate investment trust established pursuant to a declaration of trust of the REIT dated January 9, 2018 (the “Declaration of Trust”), under the laws of the Province of Ontario. The REIT's Declaration of Trust was amended and restated on May 11, 2022. The principal business of the REIT is to acquire and operate multi-family residential rental properties across the United States.
As of September 30, 2026, the REIT owned 26 multifamily garden-style residential properties located across three bordering states in the Sunbelt region of the United States, which stretches across the South Atlantic and Southwest portions of the United States. The REIT currently operates in Texas, Arkansas and Oklahoma. The registered office of the REIT is at 333 Bay Street, Suite 3400, Toronto, Ontario.
(2)Basis of preparation
(a)Statement of compliance
The condensed consolidated interim financial statements of the REIT are prepared by management in accordance with International Accounting Standards ("IAS") 34, Interim Financial Reporting, as issued by the International Accounting Standards Board ("IFRS Accounting Standards" or “GAAP”). These condensed consolidated interim financial statements were approved and authorized for issuance by the Board of Trustees on November 11, 2026.
(b)Basis of measurement
The condensed consolidated interim financial statements are prepared on a historical cost basis except for investment properties, derivative financial instruments, unit-based compensation and the Class B Units (defined below), which are measured at fair value. The condensed consolidated interim financial statements are presented in U.S. dollars, which is the REIT's functional currency.
The REIT owns, manages and operates multifamily properties located in the United States. Management, when measuring the REIT’s performance, does not distinguish or group its operations on a geographical or any other basis. Accordingly, the REIT has a single reportable segment for disclosure purposes in accordance with GAAP.
(3)Material accounting policy information
Certain comparative information has been presented to conform with the current year presentation. Except as noted below, these condensed consolidated interim financial statements follow the same accounting policies and methods of applications as the consolidated financial statements as at and for the year ended December 31, 2025.
(a)IFRS Accounting Standards and amendments issued
On May 30, 2024, the IASB issued narrow-scope amendments to the classification and measurement requirements of IFRS 9 – Financial Instruments (“IFRS 9”). These amendments clarify the timing of recognition and derecognition of financial liabilities and introduce a limited exception for liabilities settled through certain electronic payment systems. The exception applies only to financial liabilities settled electronically and does not extend to other payment methods, such as manual cheques. Entities may elect to apply the exception on a system-by-system basis. IFRS 9 is effective for annual periods beginning on or after January 1, 2026. Under the IFRS 9 amendment, a company is generally required to derecognize a financial liability on the settlement date. However, when a financial liability is settled in cash using an electronic payment system, the amendment permits a company to consider the financial liability to be discharged before the settlement date if all of the following conditions are met: (i) the payment instruction has been initiated and cannot be practically withdrawn, stopped, or canceled; (ii) the payment instruction results in the company no longer having practical access to the cash intended for settlement; and (iii) the settlement risk associated with the electronic payment system is insignificant. The REIT adopted IFRS 9 prospectively beginning on January 1, 2026. The effect of initially applying these amendments has been reflected as an adjustment of $1,232 to the opening balance of Cash and Cash Equivalents and Accounts Payable.
(b)IFRS Accounting Standards and amendments issued but not yet effective
On April 9, 2024, the IASB issued IFRS 18 – Presentation and Disclosure in Financial Statements (“IFRS 18”), that will replace IAS 1 – Presentation of Financial Statements. IFRS 18 introduces new requirements to increase comparability of
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BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
similar entities, especially related to how operating profit and loss is defined. IFRS 18 is effective for annual periods beginning on or after January 1, 2027. Earlier adoption is permitted. IFRS 18 introduces a defined structure for the statement of profit or loss that is composed of categories and required subtotals into one of five categories: (i) operating, (ii) investing, (iii) financing, (iv) income taxes, and (v) discontinued operations. Management-defined performance measures (“MPMs”) will be required to be disclosed in a single note in the financial statements. In addition, all entities will be required to use the operating profit subtotal as the starting point for the statement of cash flows when presenting operating cash flows under the indirect method.
The REIT is still in the process of assessing the impact of the new standard but expects the adoption to have a significant impact to the structure of the REIT’s statement of net (loss) income and comprehensive (loss) income and additional disclosures for MPMs. The REIT intends to adopt IFRS 18 in its consolidated financial statements beginning on January 1, 2027.
(4)Asset acquisitions and dispositions
(a)Asset acquisitions
The contractual purchase prices of the investment property acquisitions noted below are subject to working capital adjustments and closing costs. All investment property acquisitions below were considered asset acquisitions.
On January 9, 2025, the REIT acquired Venue Craig Ranch, a 277-unit garden-style community in McKinney, TX (Dallas Metropolitan Service Area (“MSA”)) for a contractual purchase price of $61,042.
On May 14, 2025, the REIT acquired Forayna Vintage Park, a 350-unit apartment community in Houston, TX and Botanic Luxury, a 288-unit apartment community in Spring, TX (Houston MSA) for a contractual purchase price of $141,000.
On August 12, 2025, the REIT acquired The Ownsby, a 368-unit apartment community in Celina, TX (Dallas MSA) for a contractual purchase price of $87,500.
There were no investment property acquisitions during the nine months ended September 30, 2026.
(b)Asset dispositions
All disposition contractual sale prices noted below are presented prior to working capital adjustments and selling costs. Unless otherwise noted, existing loans and borrowing were not assumed by the purchasers.
On March 24, 2025, the REIT completed the sale of Bluff Creek Apartments, a 316-apartment unit residence in Oklahoma City, OK for a contractual sale price of $28,300. Proceeds from the sale were used for debt repayment, funding of subsequent asset purchases and other general corporate purposes
On March 31, 2025, the REIT sold three properties (Cielo I, Cielo II and Retreat at Wolf Ranch), comprising 857 apartment units located in the Austin, TX MSA, for a contractual sale price of $187,000, directly for cash consideration. Proceeds from the sale were used for debt repayment, funding of subsequent asset purchases and other general corporate purposes.
On April 30, 2025, the REIT sold six properties (Auberry at Twin Creeks, Aura Benbrook, Lakeway Castle Hills, Satori Frisco, Vale Frisco and Wimberly), comprising 1,844 apartment units located in the Dallas, TX MSA, for a contractual sale price of $431,500. Consideration for the six properties included (i) $193,000 in cash and (ii) the exchange and cancellation of 15,000,000 (approximately 75%) of the then outstanding Class B Units. Cash proceeds were utilized for debt repayment, transaction expenses and general corporate purposes.
There were no investment property dispositions during the nine months ended September 30, 2026.
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BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
(5)Restricted cash
September 30,
2026		December 31,
2025
Tenant security deposits$276 $239 
Replacement reserve871 683 
Lender escrow deposits3,803 3,135 
Restricted cash$4,950 $4,057 
(6)Resident and other receivables, net
September 30,
2026		December 31,
2025
Resident receivables, net$623 $163 
Utility reimbursements and other receivables3,493 3,635 
Resident and other receivables, net$4,116 $3,798 
(7)Prepaid expenses and other assets
September 30,
2026		December 31,
2025
Prepaid insurance$1,789 $1,121 
Other assets4,864 1,917 
Prepaid expenses and other assets$6,653 $3,038 
(8)Investment properties
A reconciliation of the carrying value for investment properties is set out below:
Nine months ended September 30, 2026Nine months ended September 30, 2025
Investment properties, beginning of period$1,387,428 $1,746,650 
Property acquisitions— 290,650 
Property dispositions— (646,800)
Additions to investment properties in use10,076 8,989 
Change in fair value of investment properties(22,002)(9,440)
1,375,502 1,390,049 
IFRIC 21 fair value adjustment5,760 5,789 
IFRIC 21 real estate tax liability adjustment(5,760)(5,789)
Investment properties, end of period$1,375,502 $1,390,049 
The REIT uses an internal valuation process to value the investment properties in use as of September 30, 2026. As part of management’s internal valuation program, the REIT obtains and reviews external valuations performed by independent third party national real estate valuation appraisals for a cross-section of properties that represent different geographical locations across the REIT’s portfolio and updates, as deemed necessary, the valuation models to reflect current market data. The REIT obtains external appraisals on a portion of the portfolio annually, such that the entire portfolio is appraised at least once every three years.
The estimated fair value of each investment property was determined using the direct capitalization income method. The stabilized future cash flows are divided by a capitalization rate. The capitalization rates were derived in part from a combination of third-party information and the observation of industry trends (Level 3 inputs). Assumptions used to derive capitalization rates include property age, amenities, renovations, geographic region, capital expenditures assumptions and location.
A significant increase (decrease) in stabilized future cash flows in isolation would result in a significantly higher (lower) fair value. A significant increase (decrease) in capitalization rate estimates in isolation would result in significantly lower (higher) fair value. Generally, a change in estimated rental income is accompanied by a directionally similar change in the rent growth per annum assumption and an opposite change in future vacancy rate estimates.
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BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
The following table summarizes the significant unobservable inputs used in the valuation of the REIT’s investment properties in use:
September 30,
2026		December 31,
2025
Capitalization rates
High7.50%7.50%
Low4.50%4.25%
Weighted average5.06%5.11%
The estimated fair values of investment properties in use are most sensitive to changes in capitalization rates and stabilized future cash flows.
The following table summarizes the potential impact of increases or decreases in these assumptions.
Change in weighted average capitalization rate assumption
Increase of
0.50%		Increase of
0.25%		No changeDecrease of
0.25%		Decrease of
0.50%
Change in stabilized future cash flows assumption
Decrease of 1.0%$(136,202)$(77,861)$(13,755)$57,014 $135,542 
No change$(123,684)$(64,753)$— $71,484 $150,805 
Increase of 1.0%$(111,166)$(51,646)$13,755 $85,954 $166,068 
(9)Accounts payable and other liabilities
September 30,
2026		December 31,
2025
Trade payables$1,288 $234 
Accrued capital expenditures554 618 
Accrued property tax liabilities19,799 24,457 
Accrued and other liabilities10,803 11,934 
Distributions payable1,809 1,808 
Interest payable on loans and borrowings1,676 2,855 
Tenant security deposits2,510 2,197 
Rent received in advance1,249 1,244 
Accounts payable and other liabilities$39,688 $45,347 
(10)Loans and borrowings
September 30,
2026		December 31,
2025
Fixed or economically hedged to fixed rate mortgage notes payable*$378,746 $407,285 
Net unamortized discount on mortgage notes payable(388)(414)
Net unamortized deferred financing costs(4,112)(5,163)
Credit Facility356,625 321,425 
Total loans and borrowings730,871 723,133 
Less: current portion of loans and borrowings(862)(28,752)
Non-current loans and borrowings$730,009 $694,381 
*Economically hedged to fixed rate mortgage notes payable includes $160,000 of mortgages which are hedged by interest rate derivative contracts (note 19).
The REIT often utilizes mortgage notes and/or the Credit Facility (discussed below) to assist in the acquisition of a property. Conversely, when the REIT disposes of a property, any directly related mortgage or encumbrance at the time of sale will either be repaid or assumed by other properties. The table above presents the total loans and borrowings balances as of each period end, and movements during the comparative periods are presented in the total loans and borrowings table below, which presents the cash flows and non-cash changes and captures any such movements for each period.
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BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
Mortgage notes
The REIT’s weighted average contractual interest rate on mortgage notes as of September 30, 2026 and December 31, 2025 was approximately 3.7% and 3.5%, respectively, which reflects the impact of interest rate derivatives but excludes the finance cost impact related to the amortization of discounts on mortgage notes and the amortization of deferred financing costs. With the inclusion of these items, the REIT’s weighted average effective interest rate on mortgage notes was approximately 3.8% and 3.6% as of September 30, 2026 and December 31, 2025, respectively. Mortgage notes as of September 30, 2026 mature at various dates from 2027 through 2056.
The mortgage notes are subject to certain financial and non-financial covenants that are required to be observed or performed to remain in good standing with the respective mortgage agreements. Failure to comply with any or all of the covenants could impact the timing of maturity of the mortgage notes which could negatively impact the REIT. Breaches of these covenants could include, but are not limited to, failure to comply with all laws and regulations, inappropriate uses of mortgaged properties, failure to comply with certain inspections, failure to provide timely books and records, failure to comply with debt service coverage ratios and other covenants required as part of the mortgage agreements. Breach of any of these conditions could result in a material impact to the REIT’s financial position as the mortgage notes (and credit facility) could be reclassified as current liabilities as the entire principal outstanding would become due immediately upon breach. In the event of a breach of a portion or all of the mortgage notes could come due in less than 12 months and subsequently classified as current liabilities on the balance sheet. As of September 30, 2026, the REIT is compliant with all covenants and there are no facts or circumstances that indicate the REIT may have difficulty complying with the covenants within 12 months of the reporting period.
Credit Facility
The REIT maintains a revolving credit facility (the “Credit Facility”) with a maximum revolving credit availability of $500,000, of which $412,447 was available as of September 30, 2026. The Credit Facility is secured by twelve borrowing base properties. The Credit Facility matures on December 8, 2029 with a one year extension option, at the REIT's election, to extend the maturity to December 8, 2030, subject to the satisfaction of certain conditions. The Credit Facility currently bears interest at the Secured Overnight Financing Rate (“SOFR”) at a selected term of one-month, three-months, or six-months, plus a contractual margin adjustment based on the duration selected ("Adjusted Term SOFR"), as defined in the Credit Facility agreement, plus 1.30% to 1.90% rate based on meeting certain leverage ratios. Alternatively, the REIT has the ability to borrow using the greatest of (i) lender prime rate, (ii) the Fed Funds rate plus 0.5%, or (iii) one-month SOFR plus 1.0% (the "Base Rate") loans plus a rate equal to 0.3% to 0.90%. As of September 30, 2026 and December 31, 2025, the balance outstanding on the Credit Facility was $356,625 and $321,425, respectively, at a variable interest rate of 5.6% and 5.3%, respectively.
The Credit Facility is subject to, and must remain compliant with, certain material financial and non-financial covenants that are required to be observed or performed to remain in good standing with the credit agreement. Failure to comply with any or all of the covenants could impact the timing of the maturity of the Credit Facility which could negatively impact the REIT. Breaches of these covenants could include, but are not limited to, failure to maintain the appropriate leverage ratio, failure to properly maintain the minimum consolidated fixed charge coverage ratio, failure to maintain the minimum consolidated tangible net worth, exceeding distribution limits, and other covenants required as part of the agreement. Breach of any of these conditions could result in a material impact to the REIT’s financial position as the Credit Facility could be reclassified as a current liability as the entire principal outstanding would become due immediately upon breach. As of September 30, 2026, the REIT is compliant with all covenants and there are no facts or circumstances that indicate the REIT may have difficulty complying with the covenants within 12 months of the reporting period. For further discussion on the contractual maturity of the Credit Facility, see the section Risk Management below (note 19(a)).
Interest rate derivatives
The REIT uses interest rate derivatives, consisting of interest rate swaps and swaptions, to manage interest rate exposure with respect to the Credit Facility, as well as other variable rate mortgage notes payable. The REIT seeks to largely align the interest rate derivative positions to the respective periods of the variable rate debt in place, subject to counterparty optional termination dates (note 19).
As of September 30, 2026, the REIT has five receive-variable / pay-fixed interest rate swaps based on various USD – SOFR CME terms with an aggregate notional value of $522,000 to manage interest rate exposure with respect to the Credit Facility, as well as other variable rate mortgage notes payable. The REIT is also subject to one additional receive-variable / pay fixed interest rate swap with a notional value of $200,000, which begins on January 4, 2027 (note 19(d)).
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BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
Total loans and borrowings
Scheduled maturities of principal and interest on all outstanding loans and borrowings as of September 30, 2026, which excludes the impact of the aforementioned interest rate derivatives, are in the table below. Contractual interest for variable rate loans and borrowings is calculated using the respective actual contractual interest rates as of September 30, 2026.
PrincipalBalloon paymentContractual
Interest		Total
payments
2026$213 $— $8,939 $9,152 
2027870 160,000 34,972 195,842 
2028902 118,690 25,459 145,051 
2029934 383,525 21,128 405,587 
2030968 35,750 1,528 38,246 
Thereafter33,519 — 15,367 48,886 
$37,406 $697,965 $107,393 $842,764 
The following schedule presents the cash flows and non-cash changes within total loans and borrowings:
Nine months ended September 30, 2026Nine months ended September 30, 2025
Loans and borrowings, beginning of period$723,133 $787,523 
Cash flows
Proceeds from issuance of loans and borrowings63,000 301,602 
Principal payments of loans and borrowings(56,339)(362,169)
Payment of debt financing costs(161)(1,908)
6,500 (62,475)
Non-cash changes
Amortization of deferred financing costs1,212 1,495 
Amortization of net discount on mortgage notes payable26 34 
1,238 1,529 
Loans and borrowings, end of period$730,871 $726,577 
(11)Class B Units of BSR Trust, LLC (“Class B Units”)
Generally, the Class B Units are economically equivalent to Units and are entitled to receive distributions equal to those provided to holders of Units. The Class B Units are non-voting and do not give enhanced economic or voting power relative to holders of Units. Accordingly, the Class B Units do not create a dual-class voting structure of the REIT. These Class B Units are classified as a liability in accordance with IAS 32, Financial Instruments: Presentation ("IAS 32"). The Class B Units are redeemable by the holders for cash or Units (on a one-for-one basis subject to customary anti-dilution adjustments), as determined by BSR in its sole discretion.
Class B Units are measured at fair value with any changes in fair value recorded in profit or loss. The fair value adjustments of Class B Units are calculated using the REIT’s Unit closing price as of the end of the reporting period. An increase in the REIT’s Unit closing price over the period results in a fair value loss whereas a decrease in the REIT’s Unit closing price over the period results in a fair value gain.
Under IFRS 13, Fair Value Measurement, if an asset or a liability measured at fair value has a bid price and an ask price, the price within the bid-ask spread that is the most representative of fair value in the circumstances shall be used to measure fair value. The REIT has recorded Class B Units at their fair value, which has been assessed to equal the closing market price of the Units at each valuation date (Level 2).
In connection with the investment property dispositions which closed on April 30, 2025, certain participating Class B Unitholders exchanged 15,000,000 Class B Units for new units of the purchaser. These were remeasured at the contractual exchange price of $15.90 per Class B Unit. The REIT subsequently cancelled 15,000,000 Class B Units, resulting in a $238,500 decrease in the Class B Units upon their cancellation.
10
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
The following table presents the outstanding Class B Units and related movements during the comparative periods:
UnitsValue
Class B Units, as of December 31, 202420,091,704$243,712 
Cash changes
Redemption of Class B Units in exchange for cash(4,362)(56)
Non-cash changes
Redemption of Class B Units in exchange for Units(45,266)(557)
Issuance of Class B Units128,0531,678 
Cancellation of Class B Units(15,000,000)(238,500)
Fair value adjustments—58,350 
Class B Units, as of September 30, 20255,170,129$64,627 
Class B Units, as of December 31, 20254,810,743$60,375 
Cash changes
Redemption of Class B Units in exchange for cash(66,897)(756)
Non-cash changes
Redemption of Class B Units in exchange for Units(30,694)(374)
Fair value adjustments—(9,238)
Class B Units, as of September 30, 20264,713,152$50,007 
(12)Convertible Debentures
$42,500 of previously outstanding Convertible Debentures were redeemed for cash on January 3, 2025 prior to their stated maturity on September 30, 2025. The redemption was affected in accordance with the terms of the trust indenture dated September 3, 2020 between the REIT and TSX Trust Company of Canada.
(13)Unitholders’ equity
The REIT is authorized to issue an unlimited number of Units. Units are ordinary units of the REIT, each of which represents a unitholders’ proportionate undivided beneficial interest and voting rights in the REIT.
On March 11, 2026, the TSX approved the REIT's normal course issuer bid (the "2026 NCIB"), pursuant to which the REIT is authorized to purchase for cancellation up to a maximum of 3,148,801 Units, or approximately 10% of the public float, over the 12-month period commencing March 16, 2026 and expiring on March 15, 2027. Purchases under the 2026 NCIB will be made through the facilities of the TSX and/or through alternative Canadian trading systems and in accordance with applicable regulatory requirements at a price per Unit representative of the market price at the time of acquisition. The number of Units that can be purchased pursuant to the NCIB is subject to a current daily maximum of 12,383 (which is equal to 25% of 49,536, being the average daily trading volume from September 1, 2025 to February 28, 2026), subject to the REIT's ability to make block purchases of Units that exceed such limits. All Units purchased under the NCIB will be cancelled upon their purchase. The REIT intends to fund the purchases out of its available resources. The REIT did not purchase or cancel any Units under the 2026 NCIB for the three and nine months ended September 30, 2026.
On March 11, 2026, the REIT filed a short form base shelf prospectus (the “2026 Base Shelf Prospectus”) in reliance on the well-known seasoned issuer regime under Part 9B of National Instrument 44-102 – Shelf Distributions. The 2026 Base Shelf Prospectus is valid for a 37-month period, during which the REIT may offer and issue, from time to time, Units, debt securities (including convertible debt securities), which may consist of debentures, notes or other types of debt and may be issuable in series, warrants exercisable to acquire Units and/or other securities of the REIT, and subscription receipts to purchase Units and/or other securities of the REIT, or any combination thereof, in amounts, at prices and on terms to be determined based on market conditions at the time of the sale and as set forth in an accompanying prospectus supplement to the 2026 Base Shelf Prospectus.
On September 30, 2026, the REIT registered its securities with the U.S. Securities and Exchange Commission (the “SEC”) under Form 40-F.
11
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
UnitsValue
Units outstanding, classified as equity, as of December 31, 202433,422,714$376,959 
Issuance of Units for unit-based compensation61,011746 
Issuance of Units in exchange for Class B Units404,1884,877 
Issuance of Units in exchange for Convertible Debentures18,402265 
Units outstanding, classified as equity, as of December 31, 202533,906,315$382,847 
Issuance of Units for unit-based compensation52,039620 
Issuance of Units for Deferred Units41,648505 
Issuance of Units in exchange for Class B Units30,694374 
Units outstanding, classified as equity, as of September 30, 202634,030,696$384,346 
Subsequent to September 30, 2026, the REIT announced a cash distribution of $0.0467 per Unit to unitholders of record as of October 30, 2026. This distribution was declared to be paid on November 16, 2026.
(14)Revenue
Base rent is allocated to lease components based on relative stand-alone selling prices. The stand-alone selling price of the rental component is determined using an adjusted market assessment approach and the stand–alone selling price of the service components is determined using an expected cost plus a margin approach.
Revenue from the rental components is recognized on a straight-line basis over the lease term and includes the recovery of property taxes and insurance as well as consideration related to late rent, month-to-month leases and payments for early terminations. Other property income mainly comprises fees associated with moving in or out, such as application fees and cleaning fees, late rental payment fees, renters’ liability insurance, parking fees, utility charges and other fee income from residents under the terms of the lease arrangements. Revenue recognition commences when a resident has the right to use the property and is recognized pursuant to the terms of the lease agreement. Payments are due at the beginning of each month and any payments made in advance of scheduled due dates are deferred as prepaid rents.
Revenue related to the service components of the REIT’s leases is accounted for in accordance with IFRS 15 - Revenue from Contracts with Customers. These services consist primarily of the recovery of utility, property maintenance and amenity costs and is recognized over time when the services are provided. Payments are due at the beginning of each month and any payments made in advance of scheduled due dates are recorded as contract liabilities included as part of accounts payable and other liabilities.
Revenue from lease components and revenue related to service components is as follows:
Three months ended September 30, 2026Three months ended September 30, 2025Nine months ended September 30, 2026Nine months ended September 30, 2025
Lease revenue$28,802 $27,972 $86,413 $93,863 
Revenue from services5,718 5,122 16,137 16,404 
Total revenue$34,520 $33,094 $102,550 $110,267 
(15)Property operating expenses
Three months ended September 30, 2026Three months ended September 30, 2025Nine months ended September 30, 2026Nine months ended September 30, 2025
Employee wages and benefits$4,558 $4,119 $13,896 $13,787 
Utility costs2,064 1,941 6,072 6,235 
Repairs and maintenance expense1,975 1,810 5,113 5,273 
Other property based costs2,278 2,565 6,485 8,351 
Property operating expenses$10,875 $10,435 $31,566 $33,646 
12
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
(16)Finance costs
Three months ended September 30, 2026Three months ended September 30, 2025Nine months ended September 30, 2026Nine months ended September 30, 2025
Finance costs from operations
Interest expense on loans and borrowings at stated rate$8,823 $8,933 $25,952 $28,310 
Interest expense on lease liability12 — 36 — 
Amortization of deferred financing costs401 588 1,212 1,495 
Amortization of net discount on loans and borrowings7 8 26 34 
Interest expense on Convertible Debentures— — — 21 
Finance costs from operations$9,243 $9,529 $27,226 $29,860 
Fair value adjustment to derivatives and other financial liabilities
Fair value adjustment to Class B Units$(5,158)$(2,690)$(9,238)$58,350 
Fair value adjustment to interest rate derivatives(1,586)(14)(4,168)5,036 
Fair value adjustment to other liabilities— — — 120 
Fair value adjustment to prepayment embedded derivatives56 122 41 212 
Fair value adjustment to derivatives and other financial liabilities$(6,688)$(2,582)$(13,365)$63,718 
Finance costs
Finance costs from operations$9,243 $9,529 $27,226 $29,860 
Fair value adjustment to derivatives and other financial liabilities(6,688)(2,582)(13,365)63,718 
Distributions on Class B Units665 724 2,005 4,973 
Finance costs$3,220 $7,671 $15,866 $98,551 
Finance income from interest rate derivatives and a note receivable are gross of finance costs from operations and are presented separately within the condensed consolidated interim statements of net (loss) income and comprehensive (loss) income.
(17)Leases
The REIT leases apartments of multifamily properties to residents under noncancelable operating leases. The leases generally have a term of one year, or less. There were no residents that accounted for more than 10% of the REIT’s total rental revenue for the nine months ended September 30, 2026.
As of September 30, 2026, the total future contractual minimum rent lease payments (excluding renewal or potential extension periods) expected to be received under noncancelable leases are as follows:
September 30,
2026
1 year$70,398 
2 years2,050 
$72,448 
The REIT’s Little Rock, Arkansas headquarters lease was renewed in December 2025 with a term that matures in December 2035 (see note 22). This lease requires monthly payments of $11 during years one and two, $12 during years three through six, and $13 during years seven through ten. The headquarters lease is accounted for as a right-of-use asset with a corresponding lease liability under IFRS 16 - Leases. The REIT recognized $12 and $36 in interest expense on the lease liability for the three and nine months ended September 30, 2026. The REIT did not recognize any interest expense on the lease liability for the three and nine months ended September 30, 2025.
13
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
The following tables present the change in the right-of-use asset and corresponding lease liability for the nine months ended September 30, 2026 and September 30, 2025:
Nine months ended September 30, 2026Nine months ended September 30, 2025
Right-of-use asset, as of beginning of period$1,195 $33 
Depreciation of right-of use asset(90)(33)
Right-of-use asset, as of end of period$1,105 $— 
Nine months ended September 30, 2026Nine months ended September 30, 2025
Lease liability, as of beginning of period$1,198 $36 
Principal payments on lease liability(66)(36)
Lease liability, as of end of period$1,132 $— 
The REIT recorded lease expenses of $38 during the nine months ended September 30, 2026 for additional low-value leased office equipment ($43 for the nine months ended September 30, 2025).
(18)Commitments and contingencies
The REIT is subject to legal proceedings and claims that arise in the ordinary course of business. These matters are generally covered by insurance. While the resolution of these matters cannot be predicted with certainty, management believes that the final outcome of such matters will not have a material adverse effect on these condensed consolidated interim financial statements. As of September 30, 2026, there are no provisions recorded as a result of legal claims.
(19)Financial instruments
(a)Risk management
The REIT’s activities expose it to market risk, credit risk and liquidity risk. Risk management is carried out by management of the REIT.
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk consists of interest rate risk, currency risk and other market price risk. In addition to the interest rate risk of variable rate mortgages, there is interest rate risk associated with the REIT’s fixed rate mortgages due to the expected requirement to refinance such mortgages in the year of maturity.
The REIT uses interest rate derivatives, consisting of interest rate swaps and swaptions, to manage interest rate exposure on variable rate debt. The REIT has historically elected to include embedded call options on certain derivatives whereby the counterparty may elect to cancel the contract prior to the end of the original term in exchange for a lower strike rate over the life of the contract. Changes in current interest rates and the interest rate outlook impact the likelihood that a counterparty may elect to terminate one or all of our interest rate swap contracts, pursuant to these call options. As current and forward expected interest rates rise, counterparty cancellation odds generally increase. As current and forward expected rates decline, cancellation odds generally decrease. Therefore, management actively monitors the interest rate environment to proactively limit the direct impact to the REIT’s finance costs (net of finance income) that may result from either a counterparty’s cancellation or the outright expiration of existing interest rate swap contracts.
As of September 30, 2026, the REIT’s total debt was 100% fixed or economically hedged to fixed rates, excluding net unamortized discounts on mortgages payable and net unamortized deferred financing costs, such that the REIT’s cash flows are not currently significantly impacted by a change in market interest rates. As mentioned above, the REIT's interest rate derivatives contain optional counterparty termination features and maturity dates that could cause the economically fixed nature of the REIT's debt to change in future periods, and there can be no assurance that the REIT will be able to continue to fix or hedge its debt in the future at favourable terms or at all.
14
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
The REIT's interest rate derivatives are not designated as hedging instruments and as a result, the changes in fair value are recognized in net (loss) income as an adjustment to finance costs in the condensed consolidated interim statement of net (loss) income and comprehensive (loss) income.
As of September 30, 2026, based on the loans and borrowings and effective interest rate derivatives at that point in time a 100 basis-point change in interest rates, assuming all other variables are constant, would result in no change in the REIT’s finance costs (net of finance income) over the next 12 months. However, the current interest rate outlook or a change in interest rates could have a significant impact on the likelihood that a counterparty may choose to terminate one or more of our interest rate swaps at the predetermined optional termination dates mentioned above, resulting in a direct impact to the REIT’s finance costs (net of finance income).
The REIT has no material exposure to currency or risk from any market prices of other securities or investments external to the REIT.
The REIT’s assets consist primarily of multifamily properties. Credit risk arises from the possibility that residents in investment properties may not fulfill their lease or contractual obligations. The REIT mitigates its credit risks by attracting residents of sound financial standing and by diversifying its mix of residents. It also monitors resident payment patterns and discusses potential resident issues with property managers on a regular basis.
Cash, restricted cash and interest rate derivatives carry minimal credit risk as all funds are maintained with reputable financial institutions. The carrying amount of financial assets represents the maximum credit exposure.
Liquidity risk is the risk that the REIT will encounter difficulty in meeting obligations associated with the maturity of financial obligations. The REIT’s liquidity is subject to macroeconomic, financial, competitive and other factors that are beyond the REIT’s control.
Liquidity risk is managed through cash flow forecasting. Management monitors forecasts of the REIT’s liquidity requirements to ensure it has sufficient cash to meet operational needs through maintaining sufficient cash and/or availability on the undrawn Credit Facility and ensuring that it meets its financial covenants related to debt agreements. Such forecasting involves judgment, takes into consideration current and projected macroeconomic conditions, the REIT's cash collection efforts, debt financing plans, and covenant compliance required under the terms of debt agreements. There is a risk that such liquidity forecasts may not be achieved and that currently available debt financing may no longer be available to the REIT at terms and conditions that are favourable to the REIT, or at all.
The REIT manages maturities of the fixed rate mortgages and monitors the repayment dates of all loans and borrowings to ensure sufficient capital will be available to cover obligations. As of September 30, 2026, the REIT had a working capital deficit of $67,527, which includes Class B Units of $50,007. The Class B Units are redeemable for cash or Units of the REIT on a one-for-one basis at the option of BSR Trust, LLC.
The REIT's immediate liquidity needs are met through cash-on-hand, cash flow from operations, refinancing of maturing mortgages and availability on its Credit Facility. As of September 30, 2026, the REIT had liquidity of $59,883, consisting of cash and cash equivalents of $4,061 and $55,822 of Credit Facility availability. The REIT can obtain additional liquidity through adding properties to the borrowing base. Management believes that there is sufficient liquidity to meet the REIT’s financial obligations for the foreseeable future.
The following table provides information on the carrying balance and the non-discounted contractual cash flows and maturities of financial liabilities with fixed repayment terms, including estimated interest payments:
Carrying
amount		Contractual
cash flows		1 year2 years3 years4 years5 years5+ years
Loans and borrowings$730,871 $735,371 $862 $279,584 $27,826 $393,335 $994 $32,770 
Interest payable1,676 107,393 35,466 27,973 22,740 5,544 1,197 14,473 
Lease liability1,132 1,369 136 143 145 148 149 648 
Accrued capital improvements554 554 554 — — — — — 
Accounts payable and other liab.37,458 37,458 37,458 — — — — — 
$771,691 $882,145 $74,476 $307,700 $50,711 $399,027 $2,340 $47,891 
15
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
(b)Fair value of financial instruments
The following information relates to estimated fair values of the REIT’s financial instruments not measured at fair value on the REIT’s condensed consolidated interim statement of financial position:
Cash and cash equivalents, restricted cash, resident and other receivables and accounts payable and other liabilities (excluding interest rate derivatives) are carried at amortized cost, which, due to their short‑term nature, approximates fair value.
The lease liability is carried at amortized cost, which approximates fair value.
Loans and borrowings are carried at amortized cost. For disclosure purposes in (c) below, the REIT estimates the fair value of loans and borrowings using discounted cash flows based on the observable rates that could be obtained for similar debt instruments with similar terms and maturities (Level 2).
There were no transfers of assets between fair value levels during the periods presented herein.
(c)Loans and borrowings
September 30, 2026December 31, 2025
Carrying amount$730,871 $723,133 
Fair value$718,316 $711,935 
(d)Interest rate derivatives
The REIT has receive variable / pay fixed interest rate derivatives based on various USD – SOFR CME terms. The interest rate derivatives are not designated as hedges for accounting purposes. The interest rate derivatives are used to manage interest rate exposure over the period of such derivatives. The differential to be paid or received on all interest rate derivatives is accrued as interest rates change and is recognized in finance costs over the life of the respective derivatives. The interest rate derivatives contain no credit risk‑related contingent features.
The following table is a summary of the REIT’s interest rate derivatives and the respective carrying values as of September 30, 2026:
Maturity
date		Fixed
Rate		Counterparty
optional
termination
date		Notional
amount		Carrying
value and fair value
Interest rate swaps, effective as of September 30, 2026
Receive variable / pay fixed swap2/1/20303.11%2/1/2027$42,000 $111 
Receive variable / pay fixed swap7/1/20302.88%7/1/2027150,000 1,379 
Receive variable / pay fixed swap4/1/20312.98%7/1/2027*175,000 1,387 
Receive variable / pay fixed swap7/1/20312.25%2/1/202750,000 280 
Receive variable / pay fixed swap7/1/20323.10%1/1/2027105,000 184 
522,000 3,341 
Interest rate swap, effective after September 30, 2026
Receive variable / pay fixed swap (effective 1/4/2027)9/1/20343.15 %1/4/2028**200,000 1,445 
$722,000 $4,786 
*This interest rate swap is subject to additional annual optional termination dates of July 1, 2028, July 1, 2029, and July 1, 2030.
**This interest rate swap is subject to additional annual optional termination dates beginning January 4, 2028, and semiannually thereafter through January 3, 2034.
On January 30, 2026, the REIT's $42,000 notional value interest rate swap was amended to reduce the fixed interest rate from 3.13% to 3.11% and extend the counterparty's optional termination date from February 2, 2026, to February 1, 2027. The interest rate swap continues to mature on February 1, 2030.
16
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
On January 30, 2026, the REIT entered into a new 3.20% receive-variable based USD - SOFR CME / pay fixed interest rate swap with a notional value of $110,000 which had an effective date of January 2, 2026, and matures on January 2, 2029, subject to the counterparty's optional early termination date of July 1, 2026.
On April 8, 2026, the REIT entered into a new 2.98% receive-variable based USD - SOFR CME / pay fixed interest rate swap with a notional value of $175,000 which had an effective date of April 1, 2026, and matures on April 1, 2031, subject to the counterparty's annual optional early termination rights beginning on July 1, 2027. In connection with the execution of this contract, the REIT's previously outstanding $110,000 notional, 3.20% swap and $65,000 notional, 2.09% swap, were cancelled.
On August 7, 2026, the REIT entered into a receive-variable based USD – SOFR CME / pay-fixed interest rate swap with a notional value of $200,000 at a fixed rate of 3.15%, which is effective on January 4, 2027. The interest rate swap matures on September 1, 2034, subject to the counterparty's optional early termination dates beginning on January 4, 2028, and semiannually thereafter through January 3, 2034.
The following table is a summary of the aggregate current and non-current fair value of interest rate derivatives held for the period presented herein:
September 30,
2026		December 31,
2025
Interest rate derivatives
Assets
Current asset$3,341 $453 
Non-current asset1,445 598 
Total assets4,786 1,051 
Liabilities
Current liabilities— (36)
Non-current liabilities— (397)
Total liabilities— (433)
Interest rate derivatives, end of period$4,786 $618 
The valuation of these instruments was determined using discounted cash flow or mark to market analyses based on the contractual terms of the derivatives, including the period to maturity of each instrument, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values determined are based on significant other observable inputs (Level 2). In addition, the REIT considered its own and the respective counterparties’ risk of non-performance in determining the fair value of its derivative financial instruments by estimating the current and potential future exposure under the derivative financial instruments that both the REIT and the counterparties were at risk for as of the valuation date. This total expected exposure was then discounted using discount factors that contemplate the creditworthiness of the REIT and the counterparties to arrive at a credit charge. This credit charge was then netted against the value of the derivative financial instruments determined using the discounted cash flow analysis described above to arrive at a total estimated fair value of the interest rate derivatives. Changes in fair value are recognized as net change in fair value of interest rate derivatives in the accompanying condensed consolidated interim statement of net (loss) income and comprehensive (loss) income.
17
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
The following table summarizes the beginning and ending fair value and the unrealized gain (loss) for the interest rate derivatives for the period presented:
Nine months ended
 September 30,		Nine months ended
 September 30,
20262025
Interest rate derivatives, beginning of period$618 $5,330 
Cash changes
Cash received for interest rate swaption(101)(80)
Non-cash changes
Realized gain on swaption expiration101 — 
Fair value adjustment to interest rate derivatives4,168 (5,036)
Interest rate derivatives, end of period$4,786 $214 
(e)Prepayment embedded derivatives
Certain mortgages payable (Note 10) contain prepayment options that represent embedded derivatives that require bifurcation from the host contract. The prepayment options are measured at fair value, with changes in the fair value being recognized as net change in fair value of prepayment embedded derivatives in the condensed consolidated interim statement of net (loss) income and comprehensive (loss) income.
The fair value of the prepayment embedded derivatives has been determined using a SOFR based interest rate swaptions as a proxy. The swaptions were structured to mirror the financial conventions of the respective loans, including payment periods, accrual basis, principal amortization, prepayment dates and prepayment premiums. The swaptions were structured as fixed receiver with a strike rate set on market as of the date of the loan agreement with exercise premiums to match the underlying loans plus a cost of refinancing upon exercise. The resulting swaption price would represent a proxy for the value of the prepayment rights embedded in the underlying loans. The fair values determined are based on significant other observable inputs (Level 2).
The following table summarizes the beginning and ending fair value and the unrealized gain (loss) for the prepayment embedded derivatives for each period presented:
Nine months ended
 September 30,		Nine months ended
 September 30,
20262025
Prepayment embedded derivatives, beginning of period$312 $657 
Non-cash changes
Fair value adjustment to prepayment embedded derivatives(41)(212)
Prepayment embedded derivatives, end of period$271 $445 
(20)Capital management
The REIT’s policy is to maintain an appropriate capital base to support ongoing operations, maintain creditor and market confidence and sustain future developments of the business. Capital consists of cash and cash equivalents, loans and borrowings, Class B Units and Unitholders’ equity. The REIT monitors capital using tools designed to anticipate cash needs and to maintain adequate working capital, while also making appropriate distributions to the unitholders on a regular basis.
In managing its capital structure, the REIT monitors performance and adjusts its capital based on its investment strategies and changes to economic conditions. To maintain or adjust its capital structure, the REIT may issue equity or new debt, issue new debt to replace existing debt (with different characteristics) or reduce existing debt.
(21)Employee benefit plan
Management of the REIT has adopted a defined contribution plan under Internal Revenue Service (“IRS”) code section 401(k) for all eligible employees. Employees become eligible after 60 days of service with the REIT. A participant may elect to defer
18
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
up to the maximum percentage of compensation permissible under Code Section 401(k). Management of the REIT elects to match employee deferrals at its discretion.
(22)Related party transactions
The condensed consolidated interim financial statements include the following related party transactions:
•Certain of the legacy BSR holders are members or affiliates of the Bailey family or are members or affiliates of the Hughes family (collectively, the “Bailey/Hughes Holders”), who together founded BSR. Key management personnel of the REIT are people who have the authority and responsibility for planning, directing and controlling the activities of the REIT directly or indirectly. Distributions on Units of $2,014 were declared to Bailey/Hughes holders and key management personnel during the nine months ended September 30, 2026 ($1,842 during the nine months ended September 30, 2025).
•Distributions on Class B Units of $1,275 were declared to Bailey/Hughes Holders and key management personnel, during the nine months ended September 30, 2026 ($3,302 during the nine months ended September 30, 2025).
•Compensation expenses include $3,071 paid to key management personnel during the nine months ended September 30, 2026 ($2,874 during the nine months ended September 30, 2025), which includes short-term employee compensation and benefits and unit-based compensation.
•The REIT leases its Little Rock, Arkansas corporate headquarters from an irrevocable trust controlled by the family of the REIT’s President, Chief Executive Officer and Chief Investment Officer, Dan Oberste, and Board Observer, John S. Bailey (see note 17). The current lease term expires in December 2035.
(23)Supplemental cash flow disclosures
Change in non-cash working capital comprises the following:
Nine months ended September 30, 2026Nine months ended September 30, 2025
Resident and other receivables, net$(318)$662 
Prepaid expenses and other assets(3,615)(222)
Accounts payable and other liabilities(5,516)(8,955)
Restricted cash(728)— 
$(10,177)$(8,515)
(24)Deferred unit compensation and unit-based compensation
Remuneration of trustees (deferred unit compensation)
The REIT adopted the Omnibus Equity Incentive Plan effective as of May 18, 2018, which includes policies for the issuance of deferred unit compensation (“Deferred Units”) to non-executive Trustees. The purpose of the Deferred Unit component of the Omnibus Equity Incentive Plan is to promote a greater alignment of interests between the non-executive Trustees and the Unitholders. Under the Omnibus Equity Incentive Plan, Trustees have the option to elect to receive up to 100% of all fees that are otherwise payable in cash in the form of Deferred Units. A Deferred Unit award is an award denominated in notional units that entitles the participant to receive Units or, if so elected by the participant and subject to the approval of the Board of Trustees, cash measured by the value of the Units in the future. Accordingly, the number of Deferred Units to be awarded to a Trustee is equal to (i) the value of all fees that the Trustee elects to receive in the form of Deferred Units, (ii) divided by the volume-weighted average trading price of a Unit on the Toronto Stock Exchange ("TSX") for the five trading days prior to the date of the award. Elections are irrevocable for the year in respect of which they are made. The Deferred Units earn additional Deferred Units for distributions that would otherwise have been payable in cash. Deferred Units granted to Trustees vest immediately upon grant. The grant date fair value of the payable is recognized in general and administrative expenses, with a corresponding increase in accounts payable and other liabilities.
For the nine months ended September 30, 2026, $777 of deferred unit compensation expense was recognized in general and administrative expenses in the condensed consolidated interim statement of net (loss) income and comprehensive (loss) income ($722 for the nine months ended September 30, 2025). The Deferred Units are measured at fair value at each reporting period using the closing market price of Units and the change in fair value is recognized in fair value
19
BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
adjustment to unit-based compensation in the condensed consolidated interim statement of net (loss) income and comprehensive (loss) income.
On January 1, 2026, one board member retired from the board and concurrently converted 100% of their outstanding 67,214 Deferred Units into 33,607 REIT Units and $413 in cash, in accordance with legal requirements for U.S. Citizens. Additionally, on May 14, 2026, an additional board member retired from the board and concurrently elected to convert 20%, or 16,688, of their outstanding Deferred Units into REIT Units. Their remaining outstanding Deferred Units are expected to convert over the next 4 years.
UnitsLiability Value
Deferred Units, as of December 31, 2024307,622$3,733 
Non-cash changes
Deferred Units issued56,406722 
Fair value adjustments—97 
Deferred Units issued, as of September 30, 2025364,028$4,552 
Deferred Units issued, as of December 31, 2025383,556$4,815 
Cash changes
Deferred Units settled for cash(33,607)(413)
Non-cash changes
Deferred Units issued69,129777 
Deferred Units exchanged for Units(50,295)(606)
Fair value adjustments—(660)
Deferred Units issued, as of September 30, 2026368,783$3,913 
Unit-based compensation
The Omnibus Equity Incentive Plan provides for awards of Restricted Units (“RUs”), Performance Units (“PUs”) and other awards denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Units.
RUs and PUs are awarded to members of the senior executive team to align the interests of the senior executive team more closely with the interests of the Unitholders. RUs and PUs are denominated in notional units that entitles the participant to receive Units or, if so elected by the participant and subject to the approval of the Board of Trustees, cash measured by the value of the Units in the future. RUs vest in three equal installments over a three-year period from the initial award and will be settled by Units issued from treasury or, if so elected by the participant and subject to the approval of the Board of Trustees, cash payable upon vesting. PUs will vest subject to performance criteria and targets established and set forth in the award agreements, and to the extent earned, will vest and become nonforfeitable on the third anniversary of the initial award. RUs and PUs earn additional RUs and PUs for distributions that would otherwise have been payable in cash. These additional RUs and PUs vest on the same basis as the initial RUs and PUs to which they relate.
The RUs and PUs are considered a financial liability due to the contractual obligation for the Trust to deliver Units at the option of the participant, subject to board approval. The RUs and PUs are measured at fair value at each reporting period using the closing market price of Units with changes in fair value recognized in Fair value adjustment to unit-based compensation in the condensed consolidated interim statement of net (loss) income and comprehensive (loss) income.
On March 15, 2025, the REIT granted 43,758 and 65,635 RUs and PUs, respectively, with a grant date fair value of $12.36 per Unit. On May 19, 2025, the REIT granted 98,178 PUs, with a grant date fair value of $12.92 per Unit. On March 13, 2026, the REIT granted 48,214 and 72,320 RUs and PUs, respectively, with a grant date fair value of $11.98 per Unit.
On January 1, 2025, 34,354 RUs vested and were settled through the issuance of 19,610 Units with a weighted average Unit price of $12.16 with the remainder of RUs settled in cash for applicable income taxes. In March 2025, the PUs under the 2022 equity incentive plan did not vest, resulting in a payout of 0%. On January 1, 2026, 42,957 RUs vested and were settled through the issuance of 25,689 Units with a weighted average Unit price of $12.30 with the remainder of RUs settled in cash for applicable income taxes. On March 17, 2026, the 2023 equity incentive plan period concluded, resulting in a payout of 72% through which 43,843 PUs vested. This vesting was settled through the issuance of 26,350 Units with a weighted average Unit price of $11.54 with the remainder settled in cash for applicable income taxes. The remaining 17,046 PUs under the 2023 equity incentive plan did not vest.
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BSR REAL ESTATE INVESTMENT TRUST
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
For the three and nine months ended September 30, 2026 and September 30, 2025
Amounts in thousands of U.S. dollars (except for unit and per unit amounts)
For the nine months ended September 30, 2026, unit-based compensation expense of $1,072 has been recognized in general and administrative expense ($971 for the nine months ended September 30, 2025). A fair value loss of $386 for the nine months ended September 30, 2026 has been recognized in fair value adjustment to unit-based compensation in the condensed consolidated interim statements of net (loss) income and comprehensive (loss) income ($368 loss for the nine months ended September 30, 2025). As of September 30, 2026, 96,261 RUs and 317,379 PUs were unvested with a carrying amount of $1,657 recorded in accounts payable and other liabilities in the condensed consolidated interim financial statements. As of December 31, 2025, 87,622 RUs and 294,096 PUs were unvested with a carrying amount of $2,006 recorded in accounts payable and other liabilities in the condensed consolidated interim financial statements.
Equity Incentive Plans - Restricted Units
20222023202420252026Total
Opening balance of units, as of January 1, 20257,71225,57341,566——74,851
Units granted———43,758—43,758
Distribution equivalents issued—5911,2801,496—3,367
Units vested and settled(7,712)(12,788)(13,854)——(34,354)
Closing balance of units, as of December 31, 2025—13,37628,99245,254—87,622
Units granted————48,21448,214
Distribution equivalents issued——5291,0991,7543,382
Units vested and settled—(13,376)(14,496)(15,085)—(42,957)
Closing balance of units, as of September 30, 2026——15,02531,26849,96896,261
Equity Incentive Plans - Performance Units
20222023202420252026Total
Opening balance of units, as of January 1, 202546,68857,52162,351——166,560
Units granted———163,813—163,813
Distribution equivalents issued—2,6712,8924,848—10,411
Non-vesting units(46,688)————(46,688)
Closing balance of units, as of December 31, 2025—60,19265,243168,661—294,096
Units granted————72,32072,320
Distribution equivalents issued—6972,3766,1442,63511,852
Non-vesting units—(17,046)———(17,046)
Units vested and settled—(43,843)———(43,843)
Closing balance of units, as of September 30, 2026——67,619174,80574,955317,379
(25)Subsequent Event
On October 14, 2026, the REIT Units began trading on the New York Stock Exchange (“NYSE”) under the ticker symbol “BSRT”. In addition to trading and listing on the NYSE, the ticker symbol for the REIT's Canadian dollar-denominated listing on the TSX was concurrently changed from "HOM.UN" to "BSRT.UN". The REIT's U.S. dollar-denominated TSX listing, "HOM.U", was delisted at the close of business on October 13, 2026, the day prior to the effective date of the NYSE listing. Trading in the REIT’s OTC ticker “BSRTF” also ceased concurrent with the listing of the Units for trading on the NYSE.
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BSR REAL ESTATE INVESTMENT TRUST
Management’s Discussion and Analysis of Financial Condition and Results of Operations
For the three and nine months ended September 30, 2026

November 11, 2026

Table of Contents
BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
TABLE OF CONTENTS
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
IMPORTANT DISCLOSURES
Presentation
This Management’s Discussion and Analysis (“MD&A”) of BSR Real Estate Investment Trust (the “REIT”, “BSR”, “we” and “our”) is prepared as of November 11, 2026, and outlines the REIT’s operating strategies, risk profile considerations, business outlook and analysis of its results of operations and financial condition for the three and nine months ended September 30, 2026.
The REIT is an unincorporated, open-ended real estate investment trust established pursuant to a third amended and restated declaration of trust dated May 11, 2022 under, and governed by, the laws of the Province of Ontario (the “Declaration of Trust”). The principal business of the REIT is to acquire and operate multi-family residential rental properties across the United States. The operations of the REIT commenced on May 18, 2018 when it completed an initial public offering ("IPO") and indirectly acquired an interest in BSR Trust, LLC (“BSR Trust”). As of September 30, 2026, the REIT owned 26 multifamily garden-style residential properties consisting of 7,170 apartment units.
This MD&A should be read in conjunction with the REIT’s condensed consolidated interim financial statements and accompanying notes for the three and nine months ended September 30, 2026, prepared in accordance with the accounting standards issued by the International Accounting Standards Board ("IFRS Accounting Standards" or “GAAP”), and the REIT’s consolidated financial statements and accompanying notes and the REIT's MD&A for the year ended December 31, 2025.
All amounts are stated in thousands of U.S. dollars, unless otherwise noted. This MD&A has been prepared based on information available to management as of November 11, 2026. Additional information about the REIT, including the REIT’s current Annual Information Form in respect of the year ended December 31, 2025 (the “AIF”) can be found on SEDAR+ at www.sedarplus.ca, EDGAR at www.sec.gov and the REIT's website at www.bsrreit.com/investors.
The registered office of the REIT is at 333 Bay Street, Suite 3400, Toronto, Ontario. The REIT’s trust units (“Units”) trade on the New York Stock Exchange (the “NYSE”) in U.S. dollars under the symbol “BSRT” and the Toronto Stock Exchange (the “TSX”) in Canadian dollars under the symbol “BSRT.UN”.
Forward-Looking Statements
This MD&A of the REIT contains “forward-looking information” as defined under Canadian securities laws and “forward-looking statements” within the meaning of applicable U.S. securities laws (collectively, “forward-looking statements”). This document should be read in conjunction with material contained in the REIT’s current consolidated financial statements along with the REIT’s other publicly filed documents. Forward-looking statements appear in this MD&A and include, but are not limited to, statements which reflect management’s expectations regarding objectives, plans, goals, strategies, future growth, results of operations, performance, business prospects, opportunities for the REIT (including exit or sale plans, acquisitions, portfolio expansion, capital recycling, capital redevelopment, property stabilizations and rental rate increases), macroeconomic and industry trends (including those relating to job growth, population growth, vacancy and home ownership rates, and the delivery and absorption of new multifamily supply), the REIT’s earnings and Same Community portfolio guidance, expectations regarding stabilization and lease-up timelines for recently acquired or non-stabilized properties, the sustainability of distributions and the AFFO Payout Ratio, and expectations regarding interest rates, borrowing costs and hedging outcomes, the REIT’s liquidity, financing and refinancing plans and its ability to meet its obligations as they become due, and the anticipated impact of new accounting standards, as well as any other forward-looking statements made within this MD&A. The words “plans”, “expects”, “does not expect”, “goals”, “seek”, “strategy”, “future”, “estimates”, “intends”, “anticipates”, “does not anticipate”, “projected”, “believes” or variations of such words and phrases or statements to the effect that certain actions, events or results “may”, “will”, “could”, “would”, “should”, “might”, “likely”, “occur”, “be achieved” or “continue” and similar expressions identify forward-looking statements. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking statements. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events or circumstances.
Such forward-looking statements are qualified in their entirety by the inherent risks, uncertainties and changes in circumstances surrounding future expectations which are difficult to predict and many of which are beyond the control of the REIT.
Forward-looking statements are necessarily based on estimates and assumptions that, while considered reasonable by management of the REIT as of the date of this MD&A, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The REIT’s estimates, beliefs and assumptions, which may prove to be incorrect, include the various assumptions set forth herein, including, but not limited to, assumptions relating to the REIT’s future growth potential, results of operations, demographic and industry trends, the absorption of new multifamily supply in the REIT’s markets and continued limited new deliveries, no changes in legislative or regulatory matters, the tax laws as currently in effect, stability of the general economy over the intermediate term, lease renewals and rental increases, resident leasing patterns including the ability to re-lease or find new residents, property operating expense and real estate tax levels, the timing and the ability of the REIT to sell and acquire certain properties, project costs and timing, a continuing trend toward land use intensification at reasonable costs and development yields, including residential development in urban markets, access to equity and debt capital markets to fund, at acceptable costs, future capital requirements and to refinance debts as they mature, continued compliance with financial covenants under the REIT’s debt agreements, the availability of investment opportunities for growth in the REIT’s target markets, the valuations to be realized on property sales relative to current IFRS Accounting Standards carrying values, the market price of the Units, and the anticipated benefits of recent property acquisitions and dispositions.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties. Forward-looking statements should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not the times at or by which such performance or results will be achieved. A number of factors could cause actual results to differ, possibly materially, from the results discussed in the forward-looking statements, including, but not limited to:
•impediments to the REIT’s ability to execute its growth strategies and operations;
•impediments to the REIT's ability to execute future acquisitions and dispositions;
•the impact of changing conditions in the U.S. multifamily housing market;
•increasing competition in the U.S. multifamily housing market;
•the effect of fluctuations and cycles in the U.S. real estate market;
•the marketability and value of the REIT’s portfolio;
•changes in the attitudes, financial condition and demand of the REIT’s demographic market;
•fluctuation in interest rates and volatility in financial markets;
•the impact of U.S. and global tariffs;
•developments and changes in applicable laws and regulations;
•the impact of climate change;
•the pace of absorption of new multifamily supply in the REIT’s markets;
•the REIT’s ability to refinance indebtedness as it matures, maintain sufficient liquidity and comply with financial covenants;
•the level and sustainability of distributions, which are subject to approval by the Board and may change;
•fluctuations in the economic environment, the environmental, social and governance landscape and the employment market (including from the impact of artificial intelligence); and
•such other factors referred to under the heading "Risk Factors" in this MD&A.
If any risks or uncertainties with respect to the above materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. Although management has attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not presently known or risk factors that management believes are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information.
Certain statements included in this MD&A may be considered “financial outlook” for purposes of applicable Canadian securities laws, including under the heading “2026 Earnings and Same Community Portfolio Guidance” herein. The financial outlook may not be appropriate for purposes other than to understand management’s current expectations relating to the future growth of the REIT as set out in this MD&A. The REIT and management believe that financial outlook has been prepared on a reasonable basis, reflecting management’s best estimates and judgments as of the date of this MD&A. In particular, the REIT’s earnings guidance is supported by the following key assumptions: modest Same Community NOI growth driven by flat to modest rate growth and advancement of select real estate adjacent business services internalization efforts, significant Non-Same Community (defined below) NOI growth driven primarily by the lease-up and full year impact of the REIT’s Property Acquisitions (defined below) offset by the Property Dispositions (defined below), and higher net costs of borrowing. Please see below under the heading “2026 Earnings and Same Community Portfolio Guidance” for further details. Please note, such assumptions are inherently subject to significant business, economic, competitive, market, regulatory, and other risks and uncertainties as outlined above, many of which are beyond the REIT’s control. Actual results may differ materially from management’s expectations if any of the assumptions referred to above prove to be inaccurate. The REIT reviews its key assumptions regularly and may change its outlook on a going-forward basis if necessary.
All forward-looking statements and financial outlook are based only on information currently available to the REIT and are made as of the date of this MD&A. Except as expressly required by applicable securities laws, the REIT assumes no obligation to publicly update or revise any forward-looking statement or financial outlook, whether as a result of new information, future events or otherwise. All forward-looking statements and financial outlook in this MD&A are qualified by these cautionary statements.
Accounting Policies
Except for the policy described in the section, "Amendments to IFRS Accounting Standards", the REIT’s accounting policies are described in the consolidated financial statements for the year ended December 31, 2025. In applying these policies, in certain cases it is necessary to use estimates, which management determines using information available to the REIT at the time. Management reviews key estimates on a quarterly basis to determine their appropriateness and any change to these estimates is applied prospectively in compliance with IFRS Accounting Standards. Significant estimates are made with respect to the fair value of investment properties.
Non-GAAP Measures
In this MD&A, the REIT uses certain non-GAAP financial measures, non-GAAP ratios and certain real estate industry supplementary financial measures to measure, compare and explain the operating results and financial performance of the REIT. These measures are commonly used by entities in the real estate industry as useful metrics for measuring performance and we believe that providing these performance measures on a supplemental basis is helpful to investors in assessing the overall financial performance of the REIT’s business. However, they do not have any standardized meaning prescribed by GAAP and are not necessarily comparable to similar measures presented by other publicly traded entities. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with GAAP. Because non-GAAP financial measures, non-GAAP ratios and supplementary financial measures do not have standardized meanings prescribed under GAAP, securities regulators require that such measures be clearly defined, identified, and reconciled to their nearest GAAP measure. The reconciliations of the non-GAAP financial measures and non-GAAP ratios used in this MD&A to the most directly comparable GAAP measures are provided under “Reconciliation of Non-GAAP Measures”.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Net Operating Income and NOI Margin
Net operating income (“NOI”) is defined as total revenue from properties (i.e. rental revenue and other property income) less property operating expenses, real estate taxes (except for adjustments related to IFRS Interpretations Committee – 21 Levies) and real estate tax refunds. NOI should not be construed as an alternative to net (loss) income determined in accordance with IFRS Accounting Standards. The REIT’s method of calculating NOI may differ from other issuers’ methods and, accordingly, may not be comparable to NOI reported by other issuers.
The REIT regards NOI as an important measure of the income generated from the income producing properties and is used by the REIT in evaluating the performance of the REIT’s properties. It is also a key input in determining the value of the REIT’s properties.
“NOI Margin” is defined as NOI divided by total revenue from properties, as a percentage. Management believes that NOI Margin is a meaningful supplementary measure of operating performance of the REIT’s income producing properties. NOI Margin is an important measure of the percentage of income generated from the income producing properties and is used by the REIT in evaluating the performance of the portfolio.
Same Community and Non-Same Community
“Same Community” results are used by management to evaluate performances of investment properties owned by the REIT during comparative periods. Same Community results are a meaningful measure of operating performance because they allow management to assess rent growth and leasing activity of its portfolio on a same property basis and the impact of capital investments. The REIT calculates Same Community results for revenue, NOI, NOI Margin and certain operating metrics.
Same Community results in this MD&A include the financial and operational results of stabilized properties the REIT has consistently owned throughout both the current and comparative periods, thus excluding the results of any acquisitions, dispositions and non-stabilized properties from the beginning of the comparative period. The properties excluded from Same Community results are collectively referred to as “Non-Same Community” properties. For the periods presented, Non-Same Community properties include the following:
•Venue Craig Ranch Apartments, Forayna Vintage Park, Botanic Luxury Living, The Ownsby and Aura 35Fifty (collectively, the “Property Acquisitions”)
•Bluff Creek Apartments, Cielo I, Cielo II, Retreat at Wolf Ranch, Auberry at Twin Creeks, Aura Benbrook, Lakeway Castle Hills, Satori Frisco, Vale Frisco and Wimberly (collectively, the “Property Dispositions”)
Funds from Operations and Adjusted Funds from Operations
In January 2022, the Real Property Association of Canada (“REALPAC”) published a white paper titled “White Paper on Funds from Operations & Adjusted Funds from Operations for IFRS”. The purpose of the white paper is to provide reporting issuers and investors with guidance on the definition of funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) and to help promote more consistent disclosure from reporting issuers. The REIT’s method of calculating FFO and AFFO is substantially in accordance with REALPAC’s recommendations, but may differ from other issuers’ methods and, accordingly, may not be comparable to FFO and AFFO, respectively, reported by other issuers.
The REIT defines FFO as IFRS Accounting Standards consolidated net income or loss adjusted for items such as unrealized changes in the estimated fair value of investment properties, the effect of changes in value of puttable instruments classified as financial liabilities, property taxes accounted for under IFRS Interpretations Committee 21 Levies, transaction costs expensed as a result of the purchase of a property being accounted for as a business combination, changes in the fair value of financial instruments which are economically effective hedges but do not qualify or were not designated for hedge accounting, losses on extinguishment of debt, operational revenue and expenses from right of use assets, transaction costs incurred related to one time strategic initiatives, transaction costs expensed as a result of property dispositions and restructuring costs. FFO should not be construed as an alternative to net (loss) income or cash flows provided by or used in operating activities determined in accordance with GAAP. The REIT regards FFO as a key measure of operating performance.
The REIT defines AFFO as FFO adjusted for items such as actual maintenance capital expenditures incurred and straight-line rental revenue differences. AFFO should not be construed as an alternative to net (loss) income or cash flows provided by or used in operating activities determined in accordance with IFRS Accounting Standards. The REIT regards AFFO as a key measure of operating performance.
FFO per Unit and AFFO per Unit
“FFO per Unit” is defined as FFO divided by the weighted average unit count for the period, which is representative of the combined Units, Class B units of BSR Trust (“Class B Units”) and deferred units of the REIT granted to the REIT’s board of trustees (“Deferred Units”).
“AFFO per Unit” is defined as AFFO divided by the weighted average unit count for the period, which is representative of the combined Units, Class B Units and Deferred Units.
The REIT regards FFO per Unit and AFFO per Unit as important measures to further evaluate the performance of FFO and AFFO on a per Unit basis in order to normalize for changes driven by unit issuances and therefore better compare the REIT’s performance period to period.
AFFO Payout Ratio
“AFFO Payout Ratio” is defined as total cash distributions of the REIT (including distributions on Class B Units) divided by AFFO. The REIT uses the AFFO Payout Ratio in assessing its distribution paying capacity.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Gross Book Value
“Gross Book Value” means the book value of the total assets of the REIT and its consolidated subsidiaries, as shown on its then most recent consolidated statement of financial position prepared in accordance with IFRS Accounting Standards.
Debt to Gross Book Value Ratio
“Debt to Gross Book Value Ratio” is calculated by dividing total loans and borrowings by Gross Book Value.
EBITDA
Earnings before interest, taxes, depreciation and amortization ("EBITDA") is defined as consolidated net (loss) income adjusted for finance costs, finance income, transaction costs incurred related to one time strategic initiatives, fair value adjustments to investment properties, derivatives, other financial liabilities and unit-based compensation, distributions on Class B Units and costs associated with the disposition of investment properties. The REIT uses EBITDA as a supplemental measure to evaluate operating performance.
Liquidity
“Liquidity” is defined as (i) cash and cash equivalents (unrestricted), plus (ii) borrowing capacity available under the Credit Facility. This metric is a useful measure of the REIT’s cash resources and credit available under committed credit facilities.
Net Asset Value and Net Asset Value per Unit
Net Asset Value (“NAV”) is calculated as the sum of the value of Unitholders’ equity and Class B Units as of the balance sheet date. NAV is a useful measure of the overall value of the REIT’s investment properties (net of outstanding debt) as of a point in time and also serves as a measure to depict the overall value driven from the performance of the REIT’s assets.
“NAV per Unit” is calculated by dividing NAV by the number of Units, Class B Units and Deferred Units outstanding as of the balance sheet date. The REIT regards NAV per Unit as an important measure to further evaluate the performance of NAV in order to normalize for changes driven by unit issuances and therefore better compare the REIT’s overall value.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
BUSINESS OVERVIEW
The REIT is an internally managed, unincorporated, open-ended real estate investment trust established pursuant to the Declaration of Trust under, and governed by, the laws of the Province of Ontario. A copy of the Declaration of Trust is available on SEDAR+ at www.sedarplus.ca, EDGAR at www.sec.gov and print copies are available upon request. The REIT primarily owns and operates a portfolio of multifamily real estate properties, with a focus on low rise multifamily communities in select high growth markets across the Sunbelt region of the United States. Additional information about the REIT, including the REIT’s current AIF in respect of the year ended December 31, 2025 can be found on SEDAR+ at www.sedarplus.ca, EDGAR at www.sec.gov and the REIT's website at www.bsrreit.com/investors.
Background of the REIT
Bailey Properties, LLC was a family business with roots dating back to 1956. In 1998, the business concentrated focus on multifamily investing in the Sunbelt region of the United States. To accelerate growth and expand its reach, in 2012, Bailey Properties, LLC combined with Summit Housing Partners to form BSR Trust, LLC, the REIT’s current operating company. Ownership and profit interests in BSR Trust, LLC were held by approximately 400 members (the “Legacy BSR Holders”). Certain of the Legacy BSR Holders are members or affiliates of the Bailey family (the “Bailey Holders”) or are members or affiliates of the Hughes family (the “Hughes Holders”, and together with the Bailey Holders, the “Bailey/Hughes Holders”), who together founded BSR Trust, LLC through the combination of Bailey Properties, LLC and Summit Housing Partners described above. The REIT was established on January 9, 2018 as a real estate investment trust and was formed for the purpose of acquiring and owning multifamily real estate properties and completed its IPO on May 18, 2018. Upon the closing of the IPO, and following certain pre-closing reorganization events involving BSR Trust, LLC, a subsidiary of the REIT merged with and into BSR Trust, resulting in the REIT indirectly acquiring an interest in an initial portfolio of multifamily garden-style residential properties held by BSR Trust, LLC. In connection with the reorganization, all of the issued and outstanding securities of BSR Trust held by the Legacy BSR Holders were exchanged for new Class B Units of BSR Trust.
The Class B Units are economically equivalent to Units and are redeemable by the holder thereof for cash or Units (on a one-for-one basis subject to customary anti-dilution adjustments), as determined by BSR in its sole discretion. However, Class B Units do not carry a voting right with respect to matters put before Unitholders of the REIT for vote. The Class B Units are non-voting as a result of tax considerations applicable to the cross-border REIT structure, and do not give the holders of Class B Units any enhanced economic or voting power at the REIT level relative to voting public Unitholders. Accordingly, the Class B Units do not create a traditional dual-class voting structure of the REIT.
As of September 30, 2026, the Bailey/Hughes Holders together owned 2,909,398 Class B Units and 4,384,191 Units, together representing an approximate 18.8% ownership interest in the REIT (determined as if all Class B Units are redeemed for Units).
The investment guidelines of the REIT are outlined in the Declaration of Trust. As of September 30, 2026, the REIT was in compliance with all investment guidelines and operating policies stipulated in the Declaration of Trust.
Objectives
The objectives of the REIT are to:
•provide holders of Units (“Unitholders”) with an opportunity to invest in a portfolio of quality multifamily real estate properties located in attractive U.S. markets which have employment and population growth generated from a diverse economy including, but not limited to, industry, government and/or education, with a particular focus on the Sunbelt region (generally considered to stretch across the South Atlantic and Southwest portions of the country and to include the following states: Alabama, Arizona, Arkansas, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia and Washington, D.C.) (the “Sunbelt region”);
•enhance the value of the REIT's assets and maximize long-term Unit value through active internal asset and property management programs and procedures;
•expand the asset base of the REIT and increase the REIT's FFO per Unit, AFFO per Unit and NAV per Unit primarily through acquisitions in attractive growth markets and improvement of its properties using targeted capital expenditures; and
•provide Unitholders with predictable, sustainable and growing cash distributions.
Growth Strategy
The REIT believes it is well positioned to execute on a balanced growth strategy through both internal and external growth initiatives. The REIT’s organic growth strategy is focused primarily on (i) acquisition lease-up and subsequent stabilization of
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
recently acquired or underperforming properties, (ii) the internalization of various resident amenity service offerings such as internet service or trash services, (iii) value enhancing capital expenditures, and/or (iv) ancillary income initiatives.
Externally, the REIT intends to continue to pursue a disciplined on-balance sheet growth strategy when its cost of capital fosters accretive growth, while concurrently taking into consideration the REIT’s current and pro forma leverage positions. When appropriate, external growth will be accomplished through investing in high quality multifamily communities which generally demonstrate similar demographic trends to that of the existing portfolio. In addition, the REIT will continue to opportunistically review its existing portfolio with the goal of rotating capital to maximize total Unitholder returns, by selling non-core properties that no longer meet the REIT’s long-term growth strategy.
Environmental, Social and Governance
At our core, BSR is in the business of serving our residents, employees, stakeholders and communities where we own and operate. The mission of BSR is to provide an exceptional living experience for residents at a community they are proud to call home while creating value for our Unitholders through strength, profitability and growth. BSR conducts business with integrity and strives for the highest ethical standards by always treating partners, team members, residents and vendors with respect, honesty and fairness. We believe that any interaction with our company should be a genuinely positive experience, and we believe in leaving things better than we found them. This ideology has been integral to our success since the roots of the formation of BSR in 1956.
The REIT’s Environmental and Social Responsibility Policy outlines the REIT’s approach to environmental sustainability and social responsibility from a corporate governance perspective as well as the REIT’s commitments to embed these practices into its business model. Additionally, the REIT’s Talent Development and Management Policy (formerly the Diversity Policy) reflects the REIT’s commitment toward adding additional members to the REIT’s board of trustees (the “Board”) and senior management team with diversity, which may encompass a variety of dimensions in this context.
Select highlights of the REIT's Environmental, Social and Governance initiatives include:
Environmental
Social
Governance
42% of units have been upgraded to smart home technology lowering energy costs by 15-20% in those units
Our furnished “Home Away from Home” apartments have sheltered families in need for over 1,500 nights at BSR
properties
The Board maintains oversight of all enterprise risk management initiatives
Investment in smart waste management across all properties
BSR provides its residents access to a credit builder program
Regular contact with a broad base of investors
67% of BSR properties are sub-metered which are on average 38% more efficient than non-sub-metered
To encourage resident health, wellness and quality of life, 100% of BSR’s apartment communities have on-site pools
and fitness centers
High quality IT infrastructure and active cybersecurity monitoring and protection initiatives
Electric vehicle charging stations
BSR is committed to providing a diverse and inclusive workforce: our workforce is currently approximately 42% female and 69% racially diverse
Rigorous code of business conduct and ethics and anonymous whistleblower hotline
Low-flow toilets, LED lighting, high efficiency fixtures and Energy Star approved appliances
Earned Best Places to Work in Multifamily 4 years in a row and Best Places to Work in
Multifamily for Women 2 years in a row
Excluding the CEO, all members of the Board of Trustees are independent
Management encourages stakeholders to review the full description of the REIT's Environmental, Social and Governance initiatives which can be found in the REIT’s current AIF on SEDAR+ at www.sedarplus.ca, EDGAR at www.sec.gov and the REIT's website at www.bsrreit.com/investors.
Current Portfolio
As of September 30, 2026, the REIT currently owns 26 multifamily garden-style residential properties consisting of 7,170 apartment units, located in Texas, Oklahoma and Arkansas. With a primary focus on resident experience, our properties include many modern features and amenities such as resort style swimming pools, splash pads, upscale clubhouses, modern fitness centers, dog parks, pet care centers, garages and covered parking, bicycle storage, cinemas, private work pods, conference rooms, business centers, community game rooms and outdoor barbecue areas.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
The following table depicts the percentage of total NOI by Metropolitan Service Area ("MSA") for the current portfolio of properties within the REIT's markets of Austin, Dallas, Houston and Other Markets (consisting of Oklahoma City and Little Rock).
MSANumber of Units% NOI
Houston, TX2,874 41.0%
Dallas, TX2,026 28.0%
Austin, TX1,317 21.0%
Other Markets953 10.0%
Total Portfolio7,170 100.0%
Recent Developments
On January 9, 2025, the REIT acquired Venue Craig Ranch Apartments, a 277-unit garden-style community in McKinney, TX (Dallas MSA (as defined below)) for a contractual purchase price of $61.0 million. On March 24, 2025, the REIT sold Bluff Creek Apartments, a 316-unit apartment community located in Oklahoma City, OK, for a contractual sale price of $28.3 million. Proceeds from the sale were used for debt repayment, funding of subsequent asset purchases and other general corporate purposes.
On March 31, 2025, the REIT sold three properties (Cielo I, Cielo II and Retreat at Wolf Ranch) comprising 857 apartment units located in Austin, TX for a contractual sale price of $187.0 million. Proceeds from the sale were used for debt repayment, funding of subsequent asset purchases and other general corporate purposes.
On April 30, 2025, the REIT sold six properties (Auberry at Twin Creeks, Aura Benbrook, Lakeway Castle Hills, Satori Frisco, Vale Frisco and Wimberly), comprising 1,844 apartment units located in the Dallas, TX MSA, for a contractual sale price of $431.5 million (the “Contribution Transaction”). Consideration for the Contribution Transaction included (i) $193.0 million in cash and (ii) the exchange and cancellation of 15,000,000 (approximately 75%) of the then outstanding Class B Units. Cash proceeds were utilized for debt repayment, transaction expenses and general corporate purposes.
On May 14, 2025, the REIT acquired Forayna Vintage Park, a 350-unit apartment community in Houston, TX and Botanic Luxury Living, a 288-unit apartment community in Spring, TX (Houston MSA) for an aggregate contractual purchase price of $141.0 million.
On August 12, 2025, the REIT acquired The Ownsby, a 368-unit apartment community in Celina, TX (Dallas MSA) for a contractual purchase price of $87.5 million (the "August 2025 Acquisition"). Unless otherwise noted, existing loans and borrowings were not assumed by the REIT or the purchasers.
On September 30, 2026, the REIT registered its securities with the U.S. Securities and Exchange Commission (the “SEC”) under Form 40-F.
On October 14, 2026, the Units began trading on the NYSE under the ticker symbol “BSRT”. In addition to trading and listing on the NYSE, the ticker symbol for the REIT's Canadian dollar-denominated listing on the TSX was concurrently changed from "HOM.UN" to "BSRT.UN". The REIT's U.S. dollar-denominated TSX listing, "HOM.U", was delisted at the close of business on October 13, 2026, the day prior to the effective date of the NYSE listing. Trading in the REIT’s OTC ticker “BSRTF” also ceased concurrent with the listing of the Units for trading on the NYSE.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
INDUSTRY OUTLOOK
Management believes characteristics of and trends in the United States multifamily sector portend an attractive investment opportunity. These trends include, but are not limited to, (i) generally balanced supply and demand fundamentals driven by demographics and declining homeownership rates, (ii) compelling population, demographic and job growth characteristics in the U.S., particularly in the Sunbelt region where the properties are located, (iii) large multifamily transaction volume and external growth opportunities in the U.S., (iv) an absence of rent control policies in the REIT’s markets, (v) regulatory frameworks that tend to be more landlord-friendly and (vi) the development of significant new product and repurposing of older product. Together, these factors suggest that U.S. multifamily assets, and in particular those located in the REIT’s key target markets, may experience stronger cash flow growth and property value appreciation.
Compared to other real estate sectors, the shorter lease durations of the multifamily sector can provide a natural hedge against inflation. Unprecedented demand for housing in 2021, coupled with favourable low cost of financing, drove a wave of development resulting in an increase in new deliveries in the second half of 2023, 2024 and continued in 2025. However, domestic migration continues into the REIT’s primary markets, from the east and west coasts of the United States, and the new supply continues to be robustly absorbed. At the same time, the pace of new development slowed as interest rates rose in 2023, and the resulting material slowdown in new deliveries is expected to render additional rent growth in the future.
Favourable economic and demographic trends in the United States continue to drive positive fundamentals within the multifamily sector. Key growth drivers in the sector include (i) strong population and employment growth, (ii) depressed homeownership rates, particularly within the middle income demographic and (iii) steadily increasing household formation. Management believes that these trends, as highlighted in greater detail below, will continue to drive strong multifamily performance and support further growth in the REIT’s target markets.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
RESULTS OF OPERATIONS
The following tables summarize selected highlights related to the REIT's operations and financial performance as of and for the three months ended September 30, 2026 ("Q3 2026") and September 30, 2025 (“Q3 2025”) and for the nine months ended September 30, 2026 ("YTD 2026") and September 30, 2025 ("YTD 2025"):
September 30, 2026September 30, 2025
Total Portfolio
Number of investment properties26 26 
Total apartment units7,170 7,170 
Average monthly in-place leases$1,483 $1,511 
Weighted average ending occupancy rate94.0%92.0%
Same Community
Average monthly in-place leases$1,434 $1,449 
Weighted average ending occupancy rate94.1%94.3%
Retention rate60.3%58.2%
Quarterly change in new lease rates(4.4%)
Quarterly change in renewal rates2.6%
Quarterly change in blended lease rates(0.2%)
Q3 2026Q3 2025YTD 2026YTD 2025
Revenue$34,520 $33,094 $102,550 $110,267 
Revenue, Same Community* Properties$26,352 $26,503 $79,020 $79,843 
Revenue, Non-Same Community* Properties$8,168 $6,591 $23,530 $30,424 
Net (loss) income and comprehensive (loss) income $(8,087)$2,874 $10,580 $(60,453)
NOI*$17,736 $17,312 $53,277 $59,192 
NOI*, Same Community* Properties$13,717 $14,367 $41,767 $43,508 
NOI*, Non-Same Community* Properties$4,019 $2,945 $11,510 $15,684 
NOI Margin*51.4%52.3%52.0%53.7%
NOI Margin*, Same Community* Properties52.1%54.2%52.9%54.5%
NOI Margin*, Non-Same Community* Properties49.2%44.7%48.9%51.6%
FFO*$7,360 $7,577 $21,352 $29,163 
FFO per Unit*$0.19 $0.19 $0.55 $0.64 
AFFO*$6,434 $6,443 $18,933 $26,607 
AFFO per Unit*$0.16 $0.17 $0.48 $0.58 
AFFO Payout Ratio*84.4%84.1%86.1%71.6%
Weighted average unit count39,128,617 39,023,496 39,119,744 45,572,408 
The following table summarizes the REIT's capitalization as of September 30, 2026 and December 31, 2025:
September 30, 2026December 31, 2025
Weighted average contractual interest rate of all loans and borrowings4.1%4.0%
Weighted average debt term of all loans and borrowings (in years)**
3.2 4.2 
Debt to Gross Book Value*52.2 %51.2%
NAV per Unit*$16.10 $16.43 
*These measures are not recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. For definitions, reconciliations and the basis of presentation of the REIT’s non-GAAP measures, refer to the sections “Non-GAAP Measures” and “Reconciliation of Non-GAAP Measures”.
**This figure includes the impact of the REIT’s option to extend the maturity of the Credit Facility by one year which is contingent upon, among other things, the REIT remaining in compliance with various covenants and the payment of a customary fee to extend the term.
Additional highlights, including any key subsequent events:
•On September 30, 2026, the REIT registered its securities with the SEC under Form 40-F; and
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
•On October 14, 2026, the Units began trading on the NYSE under the ticker symbol “BSRT”. In addition to trading and listing on the NYSE, the ticker symbol for the REIT's Canadian dollar-denominated listing on the TSX was concurrently changed from "HOM.UN" to "BSRT.UN". The REIT's U.S. dollar-denominated TSX listing, "HOM.U", was delisted at the close of business on October 13, 2026, the day prior to the effective date of the NYSE listing. Trading in the REIT’s OTC ticker “BSRTF” also ceased concurrent with the listing of the Units for trading on the NYSE.
Financial Summary for Q3 2026
Given the scale of the REIT's Property Acquisitions and Property Dispositions in 2025, the financial results depicted throughout this document are inherently dissimilar from the comparative year-to-date period. This is due to the stabilized nature of the Property Dispositions and the overall portfolio concentration and occupancy of the Non-Same Community properties as of September 30, 2026.
As the Property Acquisitions continue to improve their financial performance through stabilization, comparisons to prior periods will become more meaningful. However, even once stabilized, there will continue to be some inherent differences when comparing to the prior year results, with the exception of metrics presented on a “per Unit” basis, given that a portion of the Contribution Transaction was recapitalized through the cancellation of 15,000,000 Class B Units.
Total portfolio revenue of $34.5 million for Q3 2026 increased $1.4 million, or 4.3%, compared to $33.1 million for Q3 2025. The increase was primarily the result of $1.6 million of revenue generated from the Property Acquisitions, partially offset by the Same Community properties which reduced revenue by $0.1 million (discussed below). Total revenue resulting from the Property Acquisitions is expected to continue to improve in future periods as the lease-up and operational enhancements continue to progress through stabilization across the portfolio.
Same Community revenue of $26.4 million for Q3 2026 decreased $0.1 million, or 0.6%, compared to $26.5 million for Q3 2025, primarily due to a decrease of $0.2 million from lower average occupancy of 94.1% as of September 30, 2026 from 94.3% a year earlier and $0.1 million from lower average monthly in-place rent versus the comparative period. These revenue declines were partially offset by an increase in other property income of $0.2 million primarily related to the continued ramp-up of the REIT’s bulk internet initiative.
The following tables summarize the REIT's occupancy, average monthly rate and lease rate change, by MSA as of September 30, 2026 and 2025.
September 30, 2026September 30, 2025
MSANumber
of Units		Avg Rent Per UnitOccupancy RateNumber
of Units		Avg Rent Per UnitOccupancy Rate
Austin, TX1,079 $1,485 95.6%1,079 $1,516 94.4%
Dallas, TX1,381 1,493 95.1%1,381 1,501 94.6%
Houston, TX2,236 1,515 93.5%2,236 1,540 94.9%
Texas4,696 1,502 94.5%4,696 1,523 94.7%
Other Markets953 1,093 92.2%953 1,076 92.2%
Total Same Community5,649 1,434 94.1%5,649 1,449 94.3%
Non-Same Community1,521 1,665 93.6%1,521 1,768 83.6%
Total Portfolio7,170 $1,483 94.0%7,170 $1,511 92.0%
*The figures for Number of Units, Average Rent Per Unit and Occupancy Rate for Non-Same Community are presented for properties owned as of September 30, 2026 and September 30, 2025, respectively.
MSAEffective New Lease Rate Change for Q3 2026Effective Renewal Lease Rate Change for Q3 2026Effective Blended Lease Rate Change for Q3 2026
Austin, TX(3.2%)1.4%(0.6%)
Dallas, TX(3.5%)1.8%(0.1%)
Houston, TX(6.7%)3.2%(1.3%)
Other Markets2.3%4.1%3.5%
Total Same Community(4.4%)2.6%(0.2%)
The rental change rates shown for Q3 2026 are calculated as the average percentage change over the prior lease for new or renewed leases during the quarter, excluding short term leases. The weighted average monthly rent on in-place leases for the Same Community portfolio was $1,434 per apartment unit as of September 30, 2026 compared to $1,449 as of September 30,
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
2025. During Q3 2026, excluding short term leases, rental rates for new leases and renewals changed (4.4%) and 2.6% respectively, resulting in a (0.2%) blended change over the prior lease rates. As the wave of supply in our core markets continues to be absorbed with minimal new product expected over at least the near future, management expects the general trajectory of blended rate changes to improve in the coming quarters.
The change in net (loss) income and comprehensive (loss) income between Q3 2026 and Q3 2025 is primarily due to non-cash fair value adjustments to derivatives and other financial liabilities and investment properties as well as a reduction in costs of dispositions of investment properties. As such, the net (loss) income and comprehensive (loss) income is not considered comparable period over period.
Total portfolio NOI for Q3 2026 of $17.7 million increased $0.4 million, or 2.4%, from $17.3 million in Q3 2025. The increase was the result of contributions from the Property Acquisitions that increased NOI by $1.1 million, partially offset by Same Community properties which reduced NOI by $0.7 million (discussed below).
Same Community NOI for Q3 2026 of $13.7 million decreased $0.7 million, or 4.5%, from $14.4 million in Q3 2025 and was attributable to a $0.4 million decrease in real estate tax refunds received, the decrease in Same Community revenue as described above of $0.1 million and higher overhead costs and administrative expenses of $0.3 million, partially offset by lower property insurance of $0.1 million.
The table below summarizes the REIT's revenue and NOI results, by MSA, for Q3 2026 and Q3 2025:
Q3 2026Q3 2025$ Change$ Change% Change% Change
MSARevenueNOI *RevenueNOI *RevenueNOI *RevenueNOI *
Austin, TX$5,336 $3,022 $5,394 $2,685 $(58)$337 (1.1%)12.6%
Dallas, TX6,814 3,352 6,790 3,361 24 (9)0.4%(0.3%)
Houston, TX10,864 5,483 11,024 6,525 (160)(1,042)(1.5%)(16.0%)
Texas23,014 11,857 23,208 12,571 (194)(714)(0.8%)(5.7%)
Other Markets3,338 1,860 3,295 1,796 43 64 1.3%3.6%
Total Same Community26,352 13,717 26,503 14,367 (151)(650)(0.6%)(4.5%)
Non-Same Community8,168 4,019 6,591 2,945 1,577 1,074 23.9%36.5%
Total Portfolio$34,520 $17,736 $33,094 $17,312 $1,426 $424 4.3%2.4%
*These measures are not recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. For definitions, reconciliations and the basis of presentation of the REIT’s non-GAAP measures, refer to sections “Non-GAAP Measures” and “Reconciliation of Non-GAAP Measures”.
FFO in Q3 2026 was $7.4 million, or $0.19 per Unit, compared to $7.6 million, or $0.19 per Unit, for Q3 2025. The decrease was related to (i) rising interest rates and associated rate resets within the REIT's derivatives portfolio and (ii) higher relative leverage levels (which was primarily related to the timing of Property Acquisitions and Property Dispositions). The decrease in FFO continued to be amplified during the quarter given the initial lease-up period of the August 2025 Acquisition and the resultant relative leverage levels of the REIT following the Property Acquisitions and Property Dispositions. These dynamics should normalize throughout the remainder of 2026 as the new properties continue to perform through stabilization.
AFFO was $6.4 million, or $0.16 per Unit for Q3 2026 compared to $6.4 million, or $0.17 per Unit, for Q3 2025. The flat performance reflected the decrease in FFO and an increase in maintenance capital expenditures of $0.1 million, essentially offset by a $0.3 million improvement in the straight-line rental revenue adjustment related to the recognition of lease-up incentives over the life of the individual leases.
NAV was $16.10 per Unit as of September 30, 2026 compared to $16.43 per Unit as of December 31, 2025.
Financial Summary for YTD 2026
Total portfolio revenue of $102.6 million for YTD 2026 decreased $7.7 million, or 7.0%, compared to $110.3 million for YTD 2025. The decrease was primarily the result of the Property Dispositions which reduced revenue by $18.5 million and a $0.8 million reduction from Same Community properties (discussed below), partially offset by $11.6 million of revenue generated from Property Acquisitions. Total revenue resulting from the Property Acquisitions is expected to continue to improve in future periods as the lease-up and operational enhancements continue to progress through stabilization across the portfolio.
Same Community revenue of $79.0 million for YTD 2026 decreased $0.8 million, or 1.0%, compared to $79.8 million for YTD 2025, primarily due to a decrease of $0.9 million from lower average occupancy and $0.5 million from lower average monthly in-place rent versus the comparative period. These revenue declines were partially offset by an increase in other property income of $0.6 million, driven by an increase in utility reimbursements and the bulk internet initiative.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
The change in net income (loss) and comprehensive income (loss) between YTD 2026 and YTD 2025 is primarily due to non-cash fair value adjustments to derivatives and other financial liabilities and investment properties as well as a reduction in costs of dispositions of investment properties. As such, the net income (loss) and comprehensive income (loss) is not considered comparable period over period.
Total portfolio NOI for YTD 2026 of $53.3 million decreased $5.9 million, or 10.0%, from $59.2 million in YTD 2025. The decrease was the result of the Property Dispositions that reduced NOI by $10.5 million and a $1.7 million reduction from Same Community properties (discussed below), partially offset by a contribution of $6.3 million from Property Acquisitions.
Same Community NOI for YTD 2026 of $41.8 million decreased $1.7 million, or 4.0%, from $43.5 million in YTD 2025 and was attributable to the decrease in revenue of $0.8 million (described above), higher real estate taxes (net of refunds received) of $0.6 million, higher overhead costs and administrative expenses of $0.5 million and an increase in utility expenses of $0.2 million, partially offset by a decrease in property insurance expenses of $0.4 million.
The table below summarizes the REIT's revenue and NOI results, by MSA, for YTD 2026 and YTD 2025:
YTD 2026YTD 2025$ Change$ Change% Change% Change
MSARevenueNOI *RevenueNOI *RevenueNOI *RevenueNOI *
Austin, TX$15,940 $8,351 $16,465 $8,860 $(525)$(509)(3.2%)(5.7%)
Dallas, TX20,368 10,982 20,451 10,997 (83)(15)(0.4%)(0.1%)
Houston, TX32,800 16,828 33,079 18,088 (279)(1,260)(0.8%)(7.0%)
Texas69,108 36,161 69,995 37,945 (887)(1,784)(1.3%)(4.7%)
Other markets9,912 5,606 9,848 5,563 64 43 0.6%0.8%
Total Same Community79,020 41,767 79,843 43,508 (823)(1,741)(1.0%)(4.0%)
Non-Same Community23,530 11,510 30,424 15,684 (6,894)(4,174)(22.7%)(26.6%)
Total Portfolio$102,550 $53,277 $110,267 $59,192 $(7,717)$(5,915)(7.0%)(10.0%)
FFO was $21.4 million, or $0.55 per Unit, for YTD 2026 compared to $29.2 million, or $0.64 per Unit, for YTD 2025. The decrease was primarily related to the decrease in NOI described above, as well as higher finance costs of $1.5 million and higher general and administrative expenses of $0.4 million primarily due to legal and professional fees. The higher finance costs are primarily attributable to (i) rising interest rates and associated rate resets within the REIT's derivatives portfolio and (ii) higher relative leverage levels (which was primarily related to the timing of Property Acquisitions and Property Dispositions). The decrease in FFO was amplified during the quarter given the initial lease-up period of the August 2025 Acquisition and the resultant relative leverage levels of the REIT following the Property Acquisitions and Property Dispositions. These dynamics should normalize throughout the remainder of 2026 as the new properties continue to improve their financial performance through stabilization. The reduction in FFO was partially offset on a per Unit basis by the elimination of 15,000,000 Class B Units which were cancelled on April 30, 2025, in conjunction with the Contribution Transaction.
AFFO was $18.9 million, or $0.48 per Unit for YTD 2026 compared to $26.6 million, or $0.58 per Unit, for YTD 2025. The decrease in AFFO was primarily the result of the decrease in FFO and higher maintenance capital expenditures of $0.6 million, partially offset by a $0.7 million change in the straight-line rental revenue adjustment related to the recognition of lease-up incentives over the life of the individual leases. In addition, the reduction in AFFO was partially offset on a per Unit basis by the elimination of 15,000,000 Class B Units discussed above.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
2026 Earnings and Same Community Portfolio Guidance
The REIT’s 2026 annual guidance is outlined below for FFO per Unit and AFFO per Unit, as well as year-over-year growth in Same Community revenue, property operating expenses and real estate taxes and NOI. Management reviews its base level assumptions and strategy on a quarterly basis to determine if any material change is warranted in the reported guidance. The REIT’s 2026 annual guidance is unchanged from the previous quarter.
Initial Guidance for 2026Revised Guidance for 2026
Per UnitRangeMidpointRangeMidpoint
Total Portfolio
FFO per Unit$0.75 to $0.79$0.77$0.73 to $0.77$0.75
AFFO per Unit$0.68 to $0.74$0.71$0.66 to $0.71$0.69
Same Community Growth
Total Revenue0.50% to 1.50%1.00%(0.75%) to 0.25%(0.25%)
Property Operating Expenses and Real Estate Taxes1.00% to 2.00%1.50%(1.50%) to (0.50%)(1.00%)
NOI0.00% to 1.00%0.50%0.00% to 1.00%0.50%
Non-GAAP measures above are presented to illustrate alternative relevant measures to assess the REIT's performance. See “Non-GAAP Measures”. See also “Forward-Looking Statements”, as the figures presented above may be considered “financial outlook” for purposes of applicable Canadian securities laws and may not be appropriate for purposes other than to understand management’s current expectations relating to the future growth of the REIT. Although the REIT believes that its anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations as noted above and under "Forward-Looking Statements", the reader should not place undue reliance on forward-looking statements and information. The REIT reviews its key assumptions regularly and may change its outlook on a going-forward basis if necessary.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Selected Quarterly Financial Information
Q3 2026Q2 2026Q1 2026Q4 2025Q3 2025Q2 2025Q1 2025Q4 2024
Revenue:
Rental revenue$29,891 $29,865 $29,559 $29,636 $28,976 $29,628 $38,295 $37,046 
Other property income4,6294,3424,2644,3204,1184,0695,1815,119
34,52034,20733,82333,95633,09433,69743,47642,165
Expenses (Income):
Property operating expenses10,875 10,399 10,292 11,172 10,435 10,604 12,607 12,862 
Real estate taxes(310)— 25,421 908 (424)— 30,461 1,079 
Real estate tax fair value adjustment under IFRIC 216,606 6,527 (18,893)5,909 6,509 6,351 (22,420)6,552 
Real estate tax refunds(387)(655)(602)(49)(738)(1,108)(1,202)(64)
General and administrative expenses3,297 2,726 2,919 2,930 2,223 2,717 2,544 2,445 
Fair value adj. to investment properties20,929 9,641 (8,568)6,172 6,510 2,856 74 16,069 
Finance costs from operations9,243 9,032 8,951 9,373 9,529 8,758 11,573 10,593 
Finance income from interest rate derivatives and note receivable(1,107)(957)(1,166)(1,733)(2,017)(2,778)(2,556)(3,199)
Costs of disposition of investment properties13 — 61 — 284 6,294 5,181 — 
Distributions on Class B Units665 668 672 708 724 1,427 2,822 2,815 
Depreciation of right-of-use asset30 30 30 10 — — 33 34 
Fair value adj. to derivatives and other financial liabilities(6,688)903 (7,580)(117)(2,582)21,028 45,272 (45,958)
Fair value adj. to unit-based compensation(559)230 (718)949 (233)27 (65)(848)
42,607 38,544 10,819 36,232 30,220 56,176 84,324 2,380 
Net (loss) income and comprehensive (loss) income $(8,087)$(4,337)$23,004 $(2,276)$2,874 $(22,479)$(40,848)$39,785 
*Net (loss) income and comprehensive (loss) income include non-cash adjustments to fair value of investment properties, derivatives and other financial liabilities, and are not considered comparable period over period.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Q3 2026Q2 2026Q1 2026Q4 2025Q3 2025Q2 2025Q1 2025Q4 2024
Net (loss) income and comprehensive (loss) income $(8,087)$(4,337)$23,004 $(2,276)$2,874 $(22,479)$(40,848)$39,785 
Net (loss) income and comprehensive (loss) income per Unit$(0.21)$(0.11)$0.59 $(0.06)$0.07 $(0.51)$(0.76)$0.74 
Adjustments to arrive at FFO
Distributions on Class B Units665 668 672 708 724 1,427 2,822 2,815 
Fair value adj. to investment properties20,929 9,641 (8,568)6,172 6,510 2,856 74 16,069 
Real estate tax fair value adj. under IFRIC 216,606 6,527 (18,893)5,909 6,509 6,351 (22,420)6,552 
Property tax liability adj., net (IFRIC 21)(6,606)(6,527)18,893 (5,909)(6,509)(6,351)22,420 (6,552)
Fair value adj. to derivatives and other financial liabilities(6,688)903 (7,580)(117)(2,582)21,028 45,272 (45,958)
Fair value adj. to unit-based compensation(559)230 (718)949 (233)27 (65)(848)
Transaction costs1,079 — — — — — — — 
Costs of disposition of investment properties13 — 61 — 284 6,294 5,181 — 
Principal payments on lease liability(22)(22)(22)(7)— — (36)(36)
Depreciation of right-of-use asset30 30 30 10 — — 33 34 
Funds from Operations ("FFO") *$7,360 $7,113 $6,879 $5,439 $7,577 $9,153 $12,433 $11,861 
FFO per Unit *$0.19 $0.18 $0.18 $0.14 $0.19 $0.21 $0.23 $0.22 
Adjustments to arrive at AFFO
Maintenance capital expenditures(966)(1,243)(498)(1,099)(895)(669)(549)(933)
Straight line rental revenue differences40 65 183 (26)(239)(107)(97)(51)
Adjusted Funds from Operations ("AFFO") *$6,434 $5,935 $6,564 $4,314 $6,443 $8,377 $11,787 $10,877 
AFFO per Unit *$0.16 $0.15 $0.17 $0.11 $0.17 $0.19 $0.22 $0.20 
AFFO Payout Ratio *84.4%91.6%82.8%125.7%84.1%73.0%63.8%68.9%
Weighted average unit count39,128,617 39,131,352 39,098,938 39,042,240 39,023,496 43,951,971 53,905,295 53,805,811 
Distributions declared$5,432 $5,436 $5,434 $5,422 $5,416 $6,119 $7,515 $7,498 
*These measures are not recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. For definitions, reconciliations and the basis of presentation of the REIT’s non-GAAP measures, refer to sections “Non-GAAP Measures” and “Reconciliation of Non-GAAP Measures”.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Q3 2026Q2 2026Q1 2026Q4 2025Q3 2025Q2 2025Q1 2025Q4 2024
Net (loss) income and comprehensive (loss) income $(8,087)$(4,337)$23,004 $(2,276)$2,874 $(22,479)$(40,848)$39,785 
Adjustments to EBITDA
Finance costs from operations9,243 9,032 8,951 9,373 9,529 8,758 11,573 10,593 
Finance income from interest rate derivatives and note receivable(1,107)(957)(1,166)(1,733)(2,017)(2,778)(2,556)(3,199)
Depreciation of right-of-use asset30 30 30 10 — — 33 34 
Fair value adj. to investment properties20,929 9,641 (8,568)6,172 6,510 2,856 74 16,069 
Fair value adj. to derivatives and other financial liabilities(6,688)903 (7,580)(117)(2,582)21,028 45,272 (45,958)
Fair value adj. to unit-based compensation(559)230 (718)949 (233)27 (65)(848)
Distributions on Class B Units665 668 672 708 724 1,427 2,822 2,815 
Transaction costs1,079— — — — — — — 
Costs of disposition of investment properties13— 61 — 284 6,294 5,181 — 
EBITDA*$15,518 $15,210 $14,686 $13,086 $15,089 $15,133 $21,486 $19,291 
*These measures are not recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. For definitions, reconciliations and the basis of presentation of the REIT’s non-GAAP measures, refer to sections “Non-GAAP Measures” and “Reconciliation of Non-GAAP Measures”.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Review of Selected Operating Information
The following table highlights selected financial information of the REIT for Q3 2026, compared to Q3 2025 and YTD 2026, compared to YTD 2025. This information has been compiled from the condensed consolidated interim financial statements and notes thereto for the periods then ended.
Q3 2026Q3 2025YTD 2026YTD 2025
Revenue:
Rental revenue$29,891 $28,976 $89,315 $96,899 
Other property income4,629 4,118 13,235 13,368 
34,520 33,094 102,550 110,267 
Expenses (Income):
Property operating expenses10,875 10,435 31,566 33,646 
Real estate taxes(310)(424)25,111 30,037 
Real estate tax fair value adjustment under IFRIC 216,606 6,509 (5,760)(9,560)
Real estate tax refunds(387)(738)(1,644)(3,048)
General and administrative expenses3,297 2,223 8,942 7,484 
Fair value adj. to investment properties20,929 6,510 22,002 9,440 
Finance costs from operations9,243 9,529 27,226 29,860 
Finance income from interest rate derivatives and note receivable(1,107)(2,017)(3,230)(7,351)
Costs of disposition of investment properties13 284 74 11,759 
Distributions on Class B Units665 724 2,005 4,973 
Depreciation on right-of-use asset30 — 90 33 
Fair value adj. to derivatives and other financial liabilities(6,688)(2,582)(13,365)63,718 
Fair value adj. to unit-based compensation(559)(233)(1,047)(271)
42,607 30,220 91,970 170,720 
Net (loss) income and comprehensive (loss) income $(8,087)$2,874 $10,580 $(60,453)
Revenue
Rental revenue consists of all rental related income earned from the investment properties, including rent earned from residents under lease agreements. Other property income mainly comprises fees associated with moving in or out, such as application fees and cleaning fees, late rental payment fees, renters’ liability insurance, parking fees, utility charges and other fee income from residents under the terms of the lease arrangements.
Q3 2026Q3 2025ChangeChange %
Rental revenue$29,891 $28,976 $915 3.2%
Other property income4,629 4,118 511 12.4%
$34,520 $33,094 $1,426 4.3%
Rental revenue for Q3 2026 as compared to Q3 2025 increased $0.9 million, or 3.2%, primarily due to the Property Acquisitions which contributed incremental rental revenue of $1.2 million, partially offset by the Same Community properties which reduced rental revenue by $0.3 million. The lower rental revenue from Same Community properties was primarily due to a decrease of $0.2 million from lower average occupancy to 94.1% as of September 30, 2026 from 94.3% as of September 30, 2025 and $0.1 million from lower average monthly in-place rent of $1,434 versus the comparative period of $1,449.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Other property income for Q3 2026 compared to Q3 2025 increased $0.5 million, or 12.4%, primarily due to an increase of $0.4 million from the Property Acquisitions and $0.1 million from Same Community properties. The increase in other property income for Same Community properties is primarily due to the initial ramp up of the bulk internet initiative.
YTD 2026YTD 2025ChangeChange %
Rental revenue$89,315 $96,899 $(7,584)(7.8%)
Other property income13,235 13,368 (133)(1.0%)
$102,550 $110,267 $(7,717)(7.0%)
Rental revenue for YTD 2026 as compared to YTD 2025 decreased $7.6 million, or 7.8%, primarily due to the Property Dispositions which reduced rental revenue by $16.2 million and $1.5 million from Same Community properties, partially offset by the Property Acquisitions which contributed incremental rental revenue of $10.0 million. The decrease in rental revenue from Same Community properties is primarily due to a decrease in average occupancy, lowering revenue by $0.9 million and lower average monthly in-place rent, which decreased Same Community revenue $0.5 million.
Other property income for YTD 2026 compared to YTD 2025 decreased $0.1 million, primarily due to the Property Dispositions which reduced other property income by $2.3 million, partially offset by an increase of $1.6 million from the Property Acquisitions and $0.6 million from Same Community properties. This increase in Same Community properties is primarily due to higher utility reimbursements and the initial ramp up of the bulk internet initiative.
Property operating expenses
Property operating expenses are comprised mainly of payroll, rental, administrative, maintenance and insurance expenses, as well as other costs associated with the management of the investment properties.
Q3 2026Q3 2025ChangeChange %
Property operating expenses$10,875 $10,435 $440 4.2%
The higher property operating expenses for Q3 2026, as compared to Q3 2025, of $0.4 million, or 4.2%, are primarily related to the Property Acquisitions which increased property operating expenses by $0.3 million and $0.1 million from Same Community properties. The higher property operating expenses from Same Community properties resulted from $0.2 million in higher overhead costs and administrative expenses, partially offset by a decrease in property insurance expenses of $0.1 million.
YTD 2026YTD 2025ChangeChange %
Property operating expenses$31,566 $33,646 $(2,080)(6.2%)
The lower property operating expenses for YTD 2026, as compared to YTD 2025, of $2.1 million, or 6.2%, are primarily related to the Property Dispositions which reduced property operating expenses by $5.5 million, partially offset by increases of $3.1 million from the Property Acquisitions and $0.3 million from Same Community properties. The higher property operating expenses from Same Community properties resulted from higher overhead and administrative expenses of $0.5 million and higher utility expenses of $0.2 million, partially offset by a decrease in property insurance expenses of $0.4 million.
Real estate taxes, real estate tax fair value adjustment under IFRIC 21 and real estate tax refunds
Annual property taxes are recognized when the realty tax obligation is imposed and recorded as real estate taxes.
Real estate tax fair value adjustment under IFRIC 21 results from a pro rata property tax basis adjustment commonly included in property sales prices in the United States, as real estate taxes are recognized when the respective realty tax obligation is imposed for the year. The real estate tax fair value adjustment under IFRIC 21 represents the difference between the presumed pro rata property tax basis adjustment over the period the obligation relates to and the recognition of the realty tax obligation when it is imposed. Effectively, the real estate tax fair value adjustment under IFRIC 21 levels the annual property tax obligation proportionally throughout the year, offsetting the real estate taxes line item which is recorded at a single point in time during the year. The respective real estate taxes and real estate tax fair value adjustment under IFRIC 21 line items can fluctuate period to period depending on the timing of when revised tax assessments are received and tax credits are realized.
While these line items are presented separately on the statement of net (loss) income and comprehensive (loss) income, they should be aggregated to practically explain the movement in property taxes for the REIT for the comparative periods, as shown below.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
In addition, based on the jurisdictional practices of markets that the REIT operates in (namely in the state of Texas), the REIT typically appeals its annual tax assessments to various taxing authorities. Depending on the outcome of these appeals, the REIT may receive real estate tax refunds related to real estate taxes recognized in a previous year. The receipt of real estate tax refunds is inherently unpredictable such that there can be no guarantee that the REIT will continue to receive these refunds in a future period. Given the inherent fluctuations in this line item, the REIT presents this separately from real estate taxes.
Q3 2026Q3 2025ChangeChange %
Real estate taxes$(310)$(424)$114 (26.9%)
Real estate tax fair value adjustment under IFRIC 216,606 6,509 97 1.5%
Real estate tax refunds(387)(738)351 (47.6%)
$5,909 $5,347 $562 10.5%
The overall increase in the real estate tax related line items above for Q3 2026, as compared to Q3 2025, was $0.6 million, or 10.5%, which is driven primarily by timing related to real estate tax refunds received in 2025 compared to those received in 2026. Current real estate taxes increased by $0.2 million due to an increase of $0.3 million from Property Acquisitions, offset by decreases of $0.1 million from Same Community properties. Real estate tax refunds decreased $0.4 million due to a reduction in refunds received for Same Community properties.
YTD 2026YTD 2025ChangeChange %
Real estate taxes$25,111 $30,037 $(4,926)(16.4%)
Real estate tax fair value adjustment under IFRIC 21(5,760)(9,560)3,800 (39.7%)
Real estate tax refunds(1,644)(3,048)1,404 (46.1%)
$17,707 $17,429 $278 1.6%
The overall increase in the real estate tax related line items above for YTD 2026, as compared to YTD 2025, was $0.3 million, or 1.6%. Real estate tax refunds decreased by $1.4 million due to a decrease of $0.8 million from Same Community properties based on timing of refunds received and $0.7 million from Property Dispositions, partially offset by $0.1 million from Property Acquisitions. This was partially offset by a decrease in current real estate taxes of $1.1 million due to decreases of $3.2 million from Property Dispositions and $0.2 million from Same Community properties, offset by an increase of $2.3 million from Property Acquisitions.
General and administrative expenses
General and administrative expenses include payroll and benefits for certain REIT employees, professional fees, trustee fees, insurance and other administrative costs.
Q3 2026Q3 2025ChangeChange %
General and administrative expenses$3,297 $2,223 $1,074 48.3%
General and administrative expenses for Q3 2026, as compared to Q3 2025, increased $1.1 million, or 48.3%, due to higher legal and professional fees primarily associated with the initial listing on the NYSE.
YTD 2026YTD 2025ChangeChange %
General and administrative expenses$8,942 $7,484 $1,458 19.5%
General and administrative expenses for YTD 2026, as compared to YTD 2025, increased $1.5 million, or 19.5%, due to higher legal and professional fees primarily associated with the initial listing on NYSE as well as higher payroll related expenses.
Fair value adjustment to investment properties
In accordance with IFRS Accounting Standards, management has elected to use the fair value model to account for investment properties. Fair value adjustments were determined based on the movement of various parameters, including changes in NOI and capitalization rates.
For Q3 2026, total investment properties decreased by $16.0 million primarily due to a fair value loss to investment properties of $20.9 million and additions to investment properties of $4.9 million.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
For YTD 2026, total investment properties decreased by $11.9 million primarily due to a fair value loss to investment properties of $22.0 million, partially offset by additions to investment properties of $10.1 million.
Further information can be found in the “Investment property portfolio” section below.
Finance costs from operations and finance income
Finance costs from operations consist of interest expense on loans and borrowings, amortization of deferred financing costs, amortization of issuance (premium) discounts, interest paid on hedging instruments which are recognized in profit or loss, loss on extinguishment of debt and distributions to tenant in common interests.
Finance income consists of interest income on interest rate derivatives, consisting of interest rate swaps and swaptions, and interest income on a note receivable and other interest-bearing accounts.
While these line items are presented separately on the condensed consolidated interim statement of net (loss) income and comprehensive (loss) income, they should be aggregated to practically explain the overall movement in net finance costs for the REIT for the comparative periods, as shown below.
Q3 2026Q3 2025ChangeChange %
Finance costs from operations$9,243 $9,529 $(286)(3.0%)
Finance income from interest rate derivatives and note receivable(1,107)(2,017)910 (45.1%)
$8,136 $7,512 $624 8.3%
The increase in finance costs from operations, net of finance income, for Q3 2026, as compared to Q3 2025, is primarily attributable to (i) rising interest rates and associated rate resets within the REIT's derivatives portfolio and (ii) higher relative leverage levels (which was primarily related to the timing of Property Acquisitions and Property Dispositions).
YTD 2026YTD 2025ChangeChange %
Finance costs from operations$27,226 $29,860 $(2,634)(8.8%)
Finance income from interest rate derivatives and note receivable(3,230)(7,351)4,121 (56.1%)
$23,996 $22,509 $1,487 6.6%
The increase in finance costs from operations, net of finance income, for YTD 2026, as compared to YTD 2025, is primarily attributable to the timing of the Property Acquisitions and the Property Dispositions in 2025 as well as the impact of rising interest rates and the rotation of the interest rate derivatives portfolio.
Costs of disposition of investment properties
Costs of disposition of investment properties are the difference between the net sale proceeds and the carrying amount of the investment properties. They represent costs incurred to sell the assets such as brokerage and other advisory fees, title costs, legal and other costs associated with sales and are recognized in the statement of loss and comprehensive loss in the year of the sale.
The REIT incurred costs of disposition of investment properties of $0.3 million during Q3 2025, and $0.1 million and $11.8 million during YTD 2026 and YTD 2025, respectively, which are directly attributable to recent property dispositions.
Distributions on Class B Units
Class B Units are designated as financial liabilities and are, in all material aspects, economically equivalent to the Units on a per unit basis.
Q3 2026Q3 2025ChangeChange %
Distributions on Class B Units$665 $724 $(59)(8.1%)
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Distributions on Class B Units for Q3 2026, compared to Q3 2025, decreased $0.1 million, or 8.1%, due to the redemption of Class B Units.
YTD 2026YTD 2025ChangeChange %
Distributions on Class B Units$2,005 $4,973 $(2,968)(59.7%)
Distributions on Class B Units for YTD 2026, compared to YTD 2025, decreased $3.0 million, or 59.7%, primarily due to the cancellation of 15,000,000 Class B Units in connection with the Contribution Transaction as well as the redemption of Class B Units.
Fair value adjustment to derivatives and other financial liabilities
Fair value adjustments to derivatives and other financial liabilities consist of fair value adjustments recorded to Class B Units, interest rate derivatives and prepayment embedded derivatives.
Class B Units are measured at fair value with any changes in fair value recorded in profit or loss. The fair value adjustments of Class B Units are calculated using the Unit closing price as of the end of the reporting period. An increase in the Unit closing price over the period results in a fair value loss whereas a decrease in the Unit closing price over the period results in a fair value gain. The fair value adjustment results from the fair value of Class B Units as of the end of the period.
The REIT is subject to receive-variable / pay-fixed interest rate derivatives based on various USD – Secured Overnight Financing Rate (“SOFR”) Chicago Mercantile Exchange (“CME”) terms. These instruments are used to manage interest rate exposure over their respective maturities. The valuation of these instruments was determined using discounted cash flow or mark-to-market analyses based on the contractual terms of the derivatives, including the period to maturity of each instrument, using observable market-based inputs, including interest rate curves and implied volatilities. Changes in fair value are recognized as a fair value adjustment to interest rate derivatives in the condensed consolidated interim financial statements.
Management considers whether a contract contains an embedded derivative at inception of the contract. Derivatives embedded in other financial instruments or other host contracts are treated as separate derivatives when their risks and characteristics are not closely related to those of the host contracts and the host contracts are not measured at fair value through the statements of comprehensive income. Under IFRS 9, Financial Instruments: Recognition and Measurement, certain early redemption options that meet the definition of an embedded derivative are bifurcated from the financial liability and measured at fair value. The fair value of the prepayment embedded derivatives has been determined using a SOFR based interest rate swap options as a proxy.
Q3 2026Q3 2025
Fair value adjustment to Class B Units - (gain)/loss$(5,158)$(2,690)
Fair value adjustment to interest rate derivatives - (gain)/loss(1,586)(14)
Fair value adjustment to prepayment embedded derivatives - (gain)/loss56 122 
Fair value adjustment to derivatives and other financial liabilities - (gain)/loss$(6,688)$(2,582)
For Q3 2026, the REIT recognized a fair value gain on Class B Units of $5.2 million as a result of an decrease in the Unit closing price from $11.70 per Unit as of June 30, 2026 to $10.61 per Unit as of September 30, 2026. For Q3 2025, the REIT recognized a fair value gain on Class B Units of $2.7 million as a result of a decrease in the Unit closing price from $13.02 per Unit as of June 30, 2025 to $12.50 per Unit as of September 30, 2025.
For Q3 2026, the REIT recognized a fair value gain on interest rate derivatives of $1.6 million due to current forecasted SOFR rates as of September 30, 2026, as compared to the contractual fixed rates inherent in the derivatives.
YTD 2026YTD 2025
Fair value adjustment to Class B Units - (gain)/loss$(9,238)$58,350 
Fair value adjustment to interest rate derivatives - (gain)/loss(4,168)5,036 
Fair value adjustment to other liabilities (gain)/loss— 120 
Fair value adjustment to prepayment embedded derivatives - (gain)/loss41 212 
Fair value adjustment to derivatives and other financial liabilities - (gain)/loss$(13,365)$63,718 
For YTD 2026, the REIT recognized a fair value gain on Class B Units of $9.2 million as a result of a decrease in the Unit closing price from $12.55 per Unit as of December 31, 2025 to $10.61 per Unit as of September 30, 2026. For YTD 2025, the REIT recognized a fair value loss on Class B Units of $14.9 million as a result of an increase in the Unit closing price from $12.13 per
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
Unit as of December 31, 2024 to $12.50 per Unit as of September 30, 2025. Additionally, 15,000,000 Class B Units exchanged under the Contribution Transaction on April 30, 2025 were remeasured at the contractual exchange price of $15.90 per Class B Unit, resulting in a fair value loss of $43.5 million.
For YTD 2026, the REIT recognized a fair value gain on interest rate derivatives of $4.2 million due to current forecasted SOFR rates as of September 30, 2026, as compared to the contractual fixed rates inherent in the derivatives.
Net (loss) income and comprehensive (loss) income
Q3 2026Q3 2025Change
Net (loss) income and comprehensive (loss) income$(8,087)$2,874 $(10,961)
Net loss and comprehensive loss for Q3 2026 compared to the net income and comprehensive income for Q3 2025 changed by $11.0 million, primarily due to non-cash fair value adjustments to interest rate derivatives and other financial liabilities and investment properties. As such, the net (loss) income and comprehensive (loss) income is not considered comparable period over period.
YTD 2026YTD 2025Change
Net loss and comprehensive loss$(13,365)$(60,453)$(47,088)
Net loss and comprehensive loss for YTD 2026 compared to the net loss and comprehensive loss for YTD 2025 changed by $47.1 million, primarily due to non-cash fair value adjustments to interest rate derivatives and other financial liabilities and investment properties as well as a decrease in costs of disposition of investment properties. As such, the net loss and comprehensive loss is not considered comparable period over period.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
LIQUIDITY AND CAPITAL RESOURCES
As of September 30, 2026, the capital structure of the REIT was as follows:
September 30, 2026December 31, 2025
Indebtedness
Loans and borrowings (current portion)$862 $28,752 
Loans and borrowings (non-current portion)730,009 694,381 
730,871 723,133 
Unitholders' equity and Class B Units
Unitholders' equity579,746 581,964 
Class B Units*50,007 60,375 
Total capitalization$1,360,624 $1,365,472 
*Reflected as equity for presentation purposes. Under IFRS Accounting Standards, the Class B Units are treated as indebtedness and are reflected in the REIT's condensed consolidated interim statements of financial position as such.
Liquidity and capital resources are used to fund capital investments in the investment properties, development and acquisition activities, servicing of debt obligations and distributions to Unitholders. The principal source of liquidity is NOI generated from property operations throughout the year. Business operations are also financed using property-specific mortgages, credit facilities and equity financing.
As of September 30, 2026, the REIT had liquidity of $59.9 million, consisting of cash and cash equivalents of $4.1 million and $55.8 million available on the Credit Facility. The REIT can obtain additional liquidity through adding properties to the borrowing base.
As of September 30, 2026, current liabilities of $90.6 million exceeded current assets of $23.1 million, resulting in a working capital deficit of $67.5 million, which includes Class B Units of $50.0 million. The Class B Units are economically equivalent to Units and are redeemable by the holder thereof for cash or Units (on a one-for-one basis subject to customary anti-dilution adjustments), as determined by BSR in its sole discretion.
The REIT maintains a senior secured revolving credit facility provided by various banks (the “Credit Facility”) with a maximum revolving credit availability of $500.0 million, of which $412.4 million was available as of September 30, 2026. The Credit Facility is secured by twelve borrowing base properties. The Credit Facility matures on December 8, 2029 with a one-year extension option, at the REIT’s election, to extend the maturity to December 8, 2030, subject to the satisfaction of certain conditions. The Credit Facility currently bears interest at SOFR at a selected term of one-month, three-months or six-months plus a contractual margin adjustment based on the duration selected (“Adjusted Term SOFR”), as defined in the Credit Facility agreement, plus 1.30% to 1.90% based on meeting certain leverage ratios as defined in the Credit Facility agreement. Alternatively, the REIT has the ability to borrow using the greatest of (i) lender prime rate, (ii) the Fed Funds rate plus 0.5%, or (iii) 1-month SOFR plus 1.0% (the “Base Rate”) loans plus a rate equal to 0.30% to 0.90%. The balance outstanding on the Credit Facility was $356.6 million as of September 30, 2026 and $321.4 million as of December 31, 2025, at a variable interest rate of 5.6% and 5.3%, respectively.
Mortgage notes as of September 30, 2026 mature at various dates from 2027 through 2056.
The REIT uses interest rate derivatives, consisting of interest rate swaps and swaptions, to manage interest rate exposure on variable rate debt. The REIT has historically elected to include embedded call options on certain derivatives whereby the counterparty may elect to cancel the contract prior to the end of the original term in exchange for a lower strike rate over the life of the contract. Changes in current interest rates and the interest rate outlook impact the likelihood that a counterparty may elect to terminate one or all of our interest rate swap contracts, pursuant to these call options. As current and forward expected interest rates rise, counterparty cancellation odds generally increase. As current and forward expected rates decline, cancellation odds generally decrease. Therefore, management actively monitors the interest rate environment to proactively limit the direct impact to the REIT’s finance costs (net of finance income) that may result from either a counterparty’s cancellation or the outright expiration of existing interest rate swap contracts.
As of September 30, 2026, the REIT has five receive-variable / pay-fixed interest rate swaps based on various USD – SOFR CME terms with an aggregate notional value of $522.0 million to manage interest rate exposure with respect to the Credit Facility, as well as other variable rate mortgage notes payable. The REIT is also subject to one additional receive-variable / pay fixed interest rate swap with a notional value of $200.0 million, which begins on January 4, 2027.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
As of September 30, 2026, the interest rate derivatives structure of the REIT was as follows:
Maturity
date		Fixed
Rate		Counterparty
optional
termination
date		Notional
amount		Carrying
value and fair value
Interest rate swaps, effective as of September 30, 2026
Receive variable / pay fixed swap2/1/20303.11%2/1/2027$42,000 $111 
Receive variable / pay fixed swap7/1/20302.88%7/1/2027150,000 1,379 
Receive variable / pay fixed swap4/1/20312.98%7/1/2027*175,000 1,387 
Receive variable / pay fixed swap7/1/20312.25%2/1/202750,000 280 
Receive variable / pay fixed swap7/1/20323.10%1/1/2027105,000 184 
522,000 3,341 
Interest rate swap, effective after September 30, 2026
Receive variable / pay fixed swap (effective 1/4/2027)9/1/20343.15%1/4/2028**200,000 1,445 
$722,000 $4,786 
*This interest rate swap is subject to additional annual optional termination dates of July 1, 2028, July 1, 2029, and July 1, 2030.
**This interest rate swap is subject to additional annual optional termination dates beginning January 4, 2028, and semiannually thereafter through January 3, 2034.
On January 30, 2026, the REIT's $42.0 million notional value interest rate swap was amended to reduce the fixed interest rate from 3.13% to 3.11% and extend the counterparty's optional termination date from February 2, 2026, to February 1, 2027. The interest rate swap continues to mature on February 1, 2030.
On January 30, 2026, the REIT entered into a new 3.20% receive-variable based USD - SOFR CME/ pay fixed interest rate swap with a notional value of $110.0 million which had an effective date of January 2, 2026, and matures on January 2, 2029, subject to the counterparty's optional early termination date of July 1, 2026.
On April 8, 2026, the REIT blended its 3.20% $110.0 million and 2.09% $65.0 million interest rate swaps into a receive-variable based USD – SOFR CME / pay-fixed interest rate swap with a notional value of $175.0 million (effective April 1, 2026) at a fixed rate of 2.98%. The interest rate swap matures on April 1, 2031, subject to the counterparty’s optional early termination dates starting with July 1, 2027, and annually thereafter to and including July 1, 2030.
On August 7, 2026, the REIT entered into a receive-variable based USD – SOFR CME / pay-fixed interest rate swap with a notional value of $200.0 million at a fixed rate of 3.15%, which is effective on January 4, 2027. The interest rate swap matures on September 1, 2034, subject to the counterparty's optional early termination dates beginning on January 4, 2028, and semiannually thereafter through January 3, 2034.

The REIT funds capital expenditures with cash flows from operations and available borrowing capacity under existing credit facilities.
Subject to market conditions, the REIT may raise funding through equity financing. The REIT believes that its capital structure will provide it with financial flexibility to pursue future growth strategies. However, the REIT’s ability to fund operating expenses, capital expenditures and future debt service requirements will depend on, among other things, future operating performance, which will be affected by general economic, industry, financial and other factors, including the impact of factors beyond the REIT’s control. See “Risk Factors”.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
CONTRACTUAL COMMITMENTS
The REIT seeks to maintain a combination of short, medium and long-term debt maturities that are appropriate for the overall debt level of its portfolio, considering the availability of financing and market conditions, and the financial characteristics of each investment property. As of September 30, 2026, the REIT’s mortgage debt and Credit Facility were 100% fixed or economically hedged to fixed rates.
Management administers a portion of its variable-rate loans and borrowings using interest rate derivatives that alter the REIT’s exposure to the impact of changing interest rates. See section “Fair value adjustments to derivatives and other financial liabilities” for more detail. The REIT expects to be able to meet all obligations as they become due using some or all of the following sources of liquidity: cash flow generated from property operations, property-specific mortgages, existing cash and cash equivalents on hand and available borrowing capacity under existing credit facilities.
The following table provides information on the carrying balance and the non-discounted contractual maturities of financial liabilities of the REIT with fixed repayment terms, including estimated interest payments:
Carrying
amount		Contractual
cash flows		1 year2 years3 years4 years5 years5+ years
Loans and borrowings$730,871 $735,371 $862 $279,584 $27,826 $393,335 $994 $32,770 
Interest payable1,676 107,393 35,466 27,973 22,740 5,544 1,197 14,473 
Lease liability1,132 1,369 136 143 145 148 149 648 
Accrued capital improvements554 554 554 — — — — — 
Accounts payable and other liab.37,458 37,458 37,458 — — — — — 
$771,691 $882,145 $74,476 $307,700 $50,711 $399,027 $2,340 $47,891 
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Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
UNITHOLDERS EQUITY AND DISTRIBUTIONS
The REIT has a distribution policy pursuant to which the REIT makes cash distributions to Unitholders and, through BSR Trust, holders of Class B Units (“Class B Unitholders”), on a monthly basis. Pursuant to this distribution policy, distributions are paid to Unitholders and Class B Unitholders of record at the close of business on the last business day of a month on or about the 15th day of the following month. Distributions must be approved by the Board and are subject to change depending on the general economic outlook and financial performance of the REIT. The REIT does not use net income in accordance with IFRS Accounting Standards as the basis to establish the level of distributions as net income includes, among other items, non-cash fair value adjustments related to its property portfolio.
For YTD 2026, the REIT announced total distributions of $0.42 per Unit ($0.56 per Unit annualized), resulting in total distributions declared to Unitholders and Class B Unitholders of $16.3 million for the period ($19.1 million for YTD 2025).
The following table provides additional disclosure relating to cash distributions:
YTD 2026YTD 2025
Cash (used in) provided by operating activities$36,007 $44,886 
Less: Interest paid(27,160)(27,807)
Add: Interest received3,209 7,719 
12,056 24,798 
Less: Distributions paid to Unitholders(14,302)(14,083)
Less: Distributions paid to Class B Unitholders(2,007)(5,676)
(Deficit) excess of cash provided by operating activities over distributions paid$(4,253)$5,039 
While cash flows provided by operating activities are generally sufficient to cover distribution requirements, the timing of expenses and fluctuations in non-cash working capital may result in a temporary shortfall. For YTD 2026, cash used in operating activities was less than the combined distributions and net interest paid. This is primarily due to the timing of annual property tax payments made of $23.9 million during the first quarter of 2026, the cash impact of the ongoing lease-up and stabilization of our recently acquired properties, transaction costs incurred as well as fluctuations in working capital.
On March 11, 2026, the TSX approved the REIT's normal course issuer bid (the "NCIB"), pursuant to which the REIT is authorized to purchase for cancellation up to a maximum of 3,148,801 Units, or approximately 10% of the public float, over the 12-month period commencing March 16, 2026 and expiring on March 15, 2027. Purchases under the NCIB will be made through the facilities of the TSX and/or through alternative Canadian trading systems and in accordance with applicable regulatory requirements at a price per Unit representative of the market price at the time of acquisition. The number of Units that can be purchased pursuant to the NCIB is subject to a current daily maximum of 12,383 (which is equal to 25% of 49,536, being the average daily trading volume from September 1, 2025 to February 28, 2026), subject to the REIT's ability to make block purchases of Units that exceed such limits. All Units purchased under the NCIB will be cancelled upon their purchase. The REIT intends to fund the purchases out of its available resources. As of September 30, 2026, the REIT had not purchased or cancelled any Units under the NCIB.
On March 11, 2026, the REIT filed a short form base shelf prospectus (the “2026 Base Shelf Prospectus”) in reliance on the well-known seasoned issuer regime under Part 9B of National Instrument 44-102 – Shelf Distributions. The 2026 Base Shelf Prospectus is valid for a 37-month period, during which the REIT may offer and issue, from time to time, Units, debt securities (including convertible debt securities), which may consist of debentures, notes or other types of debt and may be issuable in series, warrants exercisable to acquire Units and/or other securities of the REIT, and subscription receipts to purchase Units and/or other securities of the REIT, or any combination thereof, in amounts, at prices and on terms to be determined based on market conditions at the time of the sale and as set forth in an accompanying prospectus supplement to the 2026 Base Shelf Prospectus. The 2026 Base Shelf Prospectus is available on the REIT’s profile on SEDAR+ at www.sedarplus.ca, EDGAR at www.sec.gov and the REIT's website at www.bsrreit.com/investors.
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BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
INVESTMENT PROPERTY PORTFOLIO
Investment properties include land and land improvements, building and building improvements, as well as furniture and equipment. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at fair value. Subsequent capital expenditures are added to the carrying value of the investment properties only when it is probable that future economic benefits will flow to the property and the cost can be measured reliably. Management evaluates financial performance of the investment property portfolio by analyzing the performance of the portfolio in a given period.
The investment property portfolio had 26 properties in use, as of September 30, 2026. A reconciliation of the carrying value for investment properties at the beginning and end of the period is set out below:
Q3 2026Q3 2025
Investment properties, beginning of period$1,387,428 $1,746,650 
Property acquisitions— 290,650 
Property dispositions— (646,800)
Additions to investment properties in use10,076 8,989 
Change in fair value of investment properties(22,002)(9,440)
1,375,502 1,390,049 
IFRIC 21 fair value adjustment5,760 5,789 
IFRIC 21 real estate tax liability adjustment(5,760)(5,789)
Investment properties, end of period$1,375,502 $1,390,049 
The REIT uses an internal valuation process to value the investment properties as of September 30, 2026. As part of management’s internal valuation program, the REIT obtains and reviews external valuations performed by independent third party national real estate valuation appraisers for a cross-section of properties that represent different geographical locations across the REIT’s portfolio and updates, as deemed necessary, the valuation models to reflect current market data. The REIT obtains external appraisals on a portion of the portfolio annually, such that the entire portfolio is appraised at least once every three years.
The estimated fair value of each investment property was determined using the direct capitalization income method. The stabilized future cash flows are divided by an overall capitalization rate. The capitalization rates were derived in part from a combination of third-party information and the observation of industry trends (Level 3 inputs). Assumptions used to derive capitalization rates include property age, amenities, renovations, geographic region, capital expenditures assumptions and location.
A significant increase (decrease) in stabilized future cash flows in isolation would result in a significantly higher (lower) fair value. A significant increase (decrease) in capitalization rate estimates in isolation would result in significantly lower (higher) fair value.
The high, low, and overall weighted average capitalization rates are set out below:
September 30,
2026		December 31,
2025
Capitalization rates
High7.50%7.50%
Low4.50%4.25%
Weighted average5.06%5.11%
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Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
CASH FLOWS
The REIT held cash and cash equivalents of $4.1 million as of September 30, 2026. The changes in cash flows for YTD 2026 as compared to YTD 2025 are as follows:
YTD 2026YTD 2025
Cash provided by operating activities$36,007 $44,886 
Cash (used in) provided by investing activities(5,041)96,805 
Cash used in financing activities(34,481)(143,833)
$(3,515)$(2,142)
Operating activities
Operating activities for YTD 2026 generated a net cash inflow of $36.0 million. This cash flow from operating activities was largely driven by cash inflows from normal business operations (net income adjusted for non-cash items and financing activities).
Investing activities
Investing activities for YTD 2026 generated a net cash outflow of $5.0 million. This was primarily driven by additions to investment properties of $10.1 million, partially offset by cash received from the repayment of the note receivable of $5.2 million.
Financing activities
Financing activities for YTD 2026 generated a net cash outflow of $34.5 million. This was primarily driven by principal payments of loans and borrowings of $56.3 million, interest paid of $27.2 million and cash distributions paid of $16.3 million, partially offset by $63.0 million in proceeds from the issuance of loans and borrowings and $3.2 million in interest received.
UNITS OUTSTANDING
The total number of Units, Class B Units and Deferred Units outstanding as of September 30, 2026 and September 30, 2025 are as follows:
September 30, 2026September 30, 2025
Units34,030,69633,505,992
Class B Units4,713,1525,170,129
Deferred Units368,783364,028
Total unit count outstanding39,112,63139,040,149
Weighted average unit count (three months ended)39,128,61739,023,496
Weighted average unit count (nine months ended)39,119,74445,572,408
Under the Declaration of Trust, the REIT is permitted to issue an unlimited number of Units.
Subject to certain limitations, the Class B Units are redeemable at the option of the holder and, therefore, are considered puttable instruments in accordance with International Accounting Standard 32 (“IAS 32”). Upon notice of redemption, BSR Trust may redeem the Class B Units for cash or Units in its sole discretion. Therefore, the Class B Units meet the definition of a financial liability under IAS 32.
Deferred Units are issued to the Board and vest immediately upon grant.
The unit count includes the combined Units, Class B Units and issued Deferred Units, weighted based on the respective ownership dates during the periods.
Additionally, unvested Restricted Units (“RUs") and unvested Performance Units (“PUs") issued to the REIT’s management as of September 30, 2026 totaled 96,261 RUs and 317,379 PUs, respectively.
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Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
TRANSACTIONS WITH RELATED PARTIES
The condensed consolidated interim financial statements include the following related party transactions:
•Key management personnel of the REIT are people who have the authority and responsibility for planning, directing and controlling the activities of the REIT directly or indirectly. Distributions on Units of $2.0 million were declared to Bailey/Hughes Holders and key management personnel during YTD 2026 ($1.8 million during YTD 2025).
•Distributions on Class B Units of $1.3 million were declared to the Bailey/Hughes Holders and key management personnel, during YTD 2026 ($3.3 million during YTD 2025).
•Compensation expenses include $3.1 million paid to key management personnel during YTD 2026 ($2.9 million during YTD 2025), which includes short-term employee compensation and benefits and unit-based compensation.
•The REIT leases its Little Rock, Arkansas corporate headquarters from an irrevocable trust controlled by the family of the REIT’s President, Chief Executive Officer and Chief Investment Officer, Dan Oberste, and Board Observer, John S. Bailey. The current lease term expires in December 2035.
CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS
Management makes estimates and assumptions concerning the future. The resulting accounting estimates may differ from actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying values of assets and liabilities within the next financial period are outlined below.
Investment properties
Investment properties consist of investment properties in use. Properties are determined to be investment properties when they are held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business. Investment properties include land and land improvements, building and building improvements, as well as furniture and equipment and certain intangibles, such as in-place leases, if any. Investment properties are measured initially at cost, including transaction costs, except for investment properties acquired in a business combination, where such costs are expensed as incurred. Subsequent to initial recognition, investment properties are measured at fair value.
Unrealized gains and losses arising from changes in the fair value of investment properties are included in profit or loss in the period in which they arise. Fair values are primarily determined internally by management using the direct capitalization income method. As part of management's internal valuation program, the REIT obtains and reviews external valuations performed by independent third party national real estate valuation appraisers for a cross-section of properties that represent different geographical locations across the REIT's portfolio. On a quarterly basis, the valuation team reviews and updates, as deemed necessary, the valuation models to reflect current market data.
Subsequent capital expenditures are added to the carrying value of the investment properties only when it is probable that future economic benefits will flow to the property and the cost can be measured reliably. All repairs and maintenance costs are expensed as incurred.
The REIT uses an internal valuation process to value the investment properties as of September 30, 2026. The fair value of each investment property was determined using the direct capitalization income method. The stabilized future cash flows are divided by an overall capitalization rate. The capitalization rates were derived in part from a combination of third-party information and the observation of industry trends (Level 3 inputs). Assumptions used to derive capitalization rates include property age, amenities, renovations, geographic region and location.
As mentioned above, the REIT engages third party appraisers to prepare valuations on a portion of the portfolio annually, such that the entire portfolio is appraised at least once every three years.
AMENDMENTS TO IFRS ACCOUNTING STANDARDS
IFRS Accounting Standards and amendments issued
On May 30, 2024, the IASB issued narrow-scope amendments to the classification and measurement requirements of IFRS 9 – Financial Instruments (“IFRS 9”). These amendments clarify the timing of recognition and derecognition of financial liabilities and introduce a limited exception for liabilities settled through certain electronic payment systems. The exception applies only to financial liabilities settled electronically and does not extend to other payment methods, such as checks. Companies may elect to apply the exception on a system-by-system basis. IFRS 9 is effective for annual periods beginning on or after January 1,
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Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
2026. Under the IFRS 9 amendment, a company is generally required to derecognize a financial liability on the settlement date. However, when a financial liability is settled in cash using an electronic payment system, the amendment permits a company to consider the financial liability to be discharged before the settlement date if all of the following conditions are met: (i) the payment instruction has been initiated and cannot be practically withdrawn, stopped, or canceled; (ii) the payment instruction results in the company no longer having practical access to the cash intended for settlement; and (iii) the settlement risk associated with the electronic payment system is insignificant. The REIT adopted IFRS 9 prospectively beginning on January 1, 2026. The effect of applying these amendments has been reflected as an adjustment in the amount of $1.2 million to the opening balance of Cash and Cash Equivalents.
IFRS Accounting Standards and amendments issued but not yet effective
On April 9, 2024, the IASB issued IFRS 18 – Presentation and Disclosure in Financial Statements (“IFRS 18”), that will replace IAS 1 – Presentation of Financial Statements. IFRS 18 introduces new requirements to increase comparability of similar entities, especially related to how operating profit and loss is defined. IFRS 18 is effective for annual periods beginning on or after January 1, 2027. Earlier adoption is permitted.
IFRS 18 introduces a defined structure for the statement of profit or loss that is composed of categories and required subtotals into one of five categories: (i) operating, (ii) investing, (iii) financing, (iv) income taxes, and (v) discontinued operations. Management-defined performance measures (“MPMs”) will be required to be disclosed in a single note in the financial statements. In addition, all entities will be required to use the operating profit subtotal as the starting point for the statement of cash flows when presenting operating cash flows under the indirect method.
The REIT is still in the process of assessing the impact of the new standard but expects the adoption to have a significant impact with respect to the structure of the REIT’s statement of net income (loss) and comprehensive income (loss) and any additional disclosures required for MPMs. The REIT intends to adopt IFRS 18 in its consolidated financial statements beginning on January 1, 2027.
DISCLOSURE CONTROLS AND INTERNAL CONTROLS OVER FINANCIAL REPORTING
Management, including the Chief Executive Officer and Chief Financial Officer, does not expect that the disclosure controls or internal controls over financial reporting of the REIT will prevent or detect all errors and all fraud or will be effective under all potential future conditions. A control system is subject to inherent limitations and, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met.
Further, the design of a control system must reflect that there are resource constraints, and the benefits of controls must be considered relative to their costs. Inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of simple errors or mistakes. Controls can also be circumvented by individual acts of some persons, by collusion of two or more people or by management override of the controls. Due to the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. The design of any control system is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential conditions. Projections of any evaluations of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
The Chief Executive Officer and the Chief Financial Officer have evaluated, or caused an evaluation under their direct supervision of, the design of disclosure controls and procedures and internal controls over financial reporting (as defined in NI 52-109) as of September 30, 2026. In making this assessment, the Chief Executive Officer and the Chief Financial Officer used the criteria set forth by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission in Internal Control – Integrated Framework (2013). Based on this evaluation, the REIT has concluded that it has a) designed disclosure controls and procedures to provide reasonable assurance that (i) material information relating to the REIT is made known to the Chief Executive Officer and the Chief Financial Officer by others, particularly during the period in which the interim filings are being prepared and (ii) information required to be disclosed by the REIT in its various reports filed or submitted under securities legislation is recorded, processed, summarized and reported within time periods specified in securities legislation; and b) designed internal controls over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS.
There have been no changes in the internal controls over financial reporting of the REIT during the period of this MD&A that have materially affected, or are reasonably likely to materially affect, the REIT’s internal controls over financial reporting.
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Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
FINANCIAL RISK MANAGEMENT
The REIT’s activities expose it to credit risk, market risk and liquidity risk. Risk management is carried out by the Chief Financial Officer under policies approved by senior executive management. The REIT faces a variety of significant and diverse risks, many of which are inherent in the business conducted by the REIT, BSR Trust and the residents of the properties. The disclosure in this MD&A is subject to the risk factors outlined below.
Liquidity risk is the risk that the REIT will encounter difficulty in meeting obligations associated with the maturity of financial obligations. The REIT’s liquidity is subject to macroeconomic, financial, competitive and other factors that are beyond the REIT’s control.
Liquidity risk is managed through cash flow forecasting. Management monitors forecasts of the REIT’s liquidity requirements to ensure it has sufficient cash to meet operational needs through maintaining sufficient cash and/or availability on the undrawn Credit Facility and the Line of Credit and ensuring that it meets its financial covenants related to debt agreements. Such forecasting involves a significant degree of judgment, takes into consideration current and projected macroeconomic conditions, the REIT's cash collection efforts, debt financing plans, and covenant compliance required under the terms of debt agreements. There is a risk that such liquidity forecasts may not be achieved and that currently available debt financing may no longer be available to the REIT at terms and conditions that are favourable to the REIT, or at all.
RISK FACTORS
The REIT faces a variety of significant and diverse risks, many of which are inherent in the business conducted by the REIT. The AIF contains a detailed summary of risk factors pertaining to the REIT and its business under the heading “Risk Factors”, which section is hereby incorporated herein by reference. The disclosures in this MD&A are subject to the risk factors outlined in the AIF. Other risks and uncertainties that the REIT does not presently consider to be material, or of which the REIT is not presently aware, may become important factors that affect the REIT’s future financial condition and results of operations. The occurrence of any of the risks discussed in the AIF could materially and adversely affect the business, prospects, financial condition, results of operations, cash flow or the ability of the REIT to make cash distributions to Unitholders and Class B Unitholders or the value of the Units.
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Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
RECONCILIATION OF NON-GAAP MEASURES
FFO, FFO per Unit, AFFO, AFFO per Unit and AFFO Payout Ratio
Set out below is a reconciliation of unaudited FFO and AFFO for the periods presented:
Q3 2026Q3 2025YTD 2026YTD 2025
Net (loss) income and comprehensive (loss) income $(8,087)$2,874 $10,580 $(60,453)
Adjustments to arrive at FFO
Distributions on Class B Units665 724 2,005 4,973 
Fair value adjustment to investment properties20,929 6,510 22,002 9,440 
Real estate tax fair value adjustment under IFRIC 216,606 6,509 (5,760)(9,560)
Property tax liability adjustment, net (IFRIC 21)(6,606)(6,509)5,760 9,560 
Fair value adjustment to derivatives and other financial liabilities(6,688)(2,582)(13,365)63,718 
Fair value adjustment to unit-based compensation(559)(233)(1,047)(271)
Transaction costs1,079 — 1,079 — 
Costs of dispositions of investment properties13 284 74 11,759 
Principal payments on lease liability(22)— (66)(36)
Depreciation of right-of-use asset30 — 90 33 
FFO$7,360 $7,577 $21,352 $29,163 
FFO per Unit$0.19 $0.19 $0.55 $0.64 
Adjustments to arrive at AFFO
Maintenance capital expenditures(966)(895)(2,707)(2,113)
Straight line rental revenue differences40 (239)288 (443)
AFFO$6,434 $6,443 $18,933 $26,607 
AFFO per Unit$0.16 $0.17 $0.48 $0.58 
Distributions declared$5,432 $5,416 $16,302 $19,050 
AFFO Payout Ratio84.4%84.1%86.1%71.6%
Weighted average unit count39,128,617 39,023,496 39,119,744 45,572,408 
NOI and NOI Margin
Set out below is a reconciliation of the unaudited NOI and NOI margin for the periods presented:
Q3 2026Q3 2025YTD 2026YTD 2025
Total revenue$34,520 $33,094 $102,550 $110,267 
Property operating expenses(10,875)(10,435)(31,566)(33,646)
Real estate taxes310 424 (25,111)(30,037)
Real estate tax refunds 387 738 1,644 3,048 
24,342 23,821 47,517 49,632 
Property tax liability adjustment, net (IFRIC 21)(6,606)(6,509)5,760 9,560 
NOI$17,736 $17,312 $53,277 $59,192 
NOI margin51.4%52.3%52.0%53.7%
The decrease in NOI margin for Q3 2026, as compared to Q3 2025, is primarily due to the stabilization of the Non-Same Community properties as well as the timing of property tax refunds received versus the comparative period.
33
Table of Contents
BSR REAL ESTATE INVESTMENT TRUST
Management's Discussion and Analysis of Financial Condition and Results of Operations
for the three and nine months ended September 30, 2026
Amounts in thousands of U.S. dollars (except for unit amounts, per unit amounts and as otherwise noted)
NAV and NAV per Unit
Set out below is a reconciliation of the NAV and NAV per Unit as of September 30, 2026, and December 31, 2025:
September 30, 2026December 31, 2025
Unitholders' equity$579,746 $581,964 
Class B Units50,007 60,375 
NAV$629,753 $642,339 
Unit count, as of the end of period39,112,631 39,100,614 
NAV per Unit$16.10 $16.43 
Debt to Gross Book Value
Set out below is a reconciliation of the Debt to Gross Book Value as of September 30, 2026, and December 31, 2025:
September 30, 2026December 31, 2025
Loans and borrowings (current portion)$862 $28,752 
Loans and borrowings (non-current portion)730,009 694,381 
Total loans and borrowings730,871 723,133 
Gross Book Value$1,401,444 $1,412,450 
Debt to Gross Book Value52.2%51.2%
EBITDA
For a reconciliation of EBITDA to net (loss) income for the periods presented, please see the "Selected Quarterly Financial Information" section herein, which table is hereby expressly incorporated by reference into this section.
34

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BSR REIT Announces Third Quarter 2026 Financial Results
Little Rock, AR and Toronto, ON, November 11, 2026 – BSR Real Estate Investment Trust (“BSR”, or the “REIT”) (NYSE: BSRT and TSX: BSRT.UN) today announced its financial results for the three and nine months ended September 30, 2026.
“Our financial results in Q3 reflect continued progress towards our long-term portfolio goals," said Dan Oberste, President and Chief Executive Officer of BSR. “Top line revenue continued its steady growth while FFO and AFFO increased 3.5% and 8.4%, respectively, on a sequential basis. Occupancy remained steady, retention reached record levels and broader operating fundamentals across our markets continued to improve. Beyond our operating results, we achieved an important strategic milestone with our U.S. registration and listing on the NYSE, broadening access to a deeper pool of investors and further advancing the evolution of BSR. As we look ahead, we remain encouraged by the gradually improving outlook for our core Texas markets and the opportunities we see to drive sustainable growth.”
Results of Operations
The following table summarizes highlights of the REIT's operational performance as of September 30, 2026, December 31, 2025 and September 30, 2025:
September 30, 2026December 31, 2025September 30, 2025
Total Portfolio
Number of investment properties26 26 26 
Total apartment units7,170 7,170 7,170 
Average monthly in-place leases$1,483 $1,496 $1,511 
Weighted average ending occupancy rate94.0 %94.1 %92.0 %
Same Community
Average monthly in-place leases$1,434 $1,436 $1,449 
Weighted average ending occupancy rate94.1 %94.3 %94.3 %
Retention rate60.3 %59.5 %58.2 %
Quarterly change in new lease rates(4.4)%
Quarterly change in renewal rates2.6 %
Quarterly change in blended lease rates(0.2)%
The following table summarizes highlights of the REIT's financial performance for the three months ended September 30, 2026 ("Q3 2026"), June 30, 2026 ("Q2 2026") and September 30, 2025 ( "Q3 2025") as well as the nine months ended September 30, 2026 ("YTD 2026") and September 30, 2025 ("YTD 2025"):
Q3 2026Q2 2026Q3 2025YTD 2026YTD 2025
Revenue$34,520 $34,207 $33,094 $102,550 $110,267 
Revenue, Same Community* Properties$26,352 $26,380 $26,503 $79,020 $79,843 
Revenue, Non-Same Community* Properties$8,168 $7,827 $6,591 $23,530 $30,424 
Net (loss) income and comprehensive (loss) income $(8,087)$(4,337)$2,874 $10,580 $(60,453)
NOI*$17,736 $17,936 $17,312 $53,277 $59,192 
NOI*, Same Community* Properties$13,717 $13,928 $14,367 $41,767 $43,508 
NOI*, Non-Same Community* Properties$4,019 $4,008 $2,945 $11,510 $15,684 
NOI Margin*51.4 %52.4 %52.3 %52.0 %53.7 %
NOI Margin*, Same Community* Properties52.1 %52.8 %54.2 %52.9 %54.5 %
NOI Margin*, Non-Same Community* Properties49.2 %51.2 %44.7 %48.9 %51.6 %
FFO*$7,360 $7,113 $7,577 $21,352 $29,163 
FFO per Unit*$0.19 $0.18 $0.19 $0.55 $0.64 
AFFO*$6,434 $5,935 $6,443 $18,933 $26,607 
AFFO per Unit*$0.16 $0.15 $0.17 $0.48 $0.58 
AFFO Payout Ratio*84.4 %91.6 %84.1 %86.1 %71.6 %
Weighted average unit count39,128,617 39,131,352 39,023,496 39,119,744 45,572,408 
*These measures are not recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. For definitions, reconciliations and the basis of presentation of the REIT's non-GAAP measures, refer to section "Non-GAAP Measures".


The following table summarizes the REIT's capitalization as of September 30, 2026, December 31, 2025 and September 30, 2025:
September 30, 2026December 31, 2025September 30, 2025
Weighted average contractual interest rate of all loans and borrowings4.1 %4.0 %4.0 %
Weighted average debt term of all loans and borrowings (in years)**3.2 4.2 2.4 
Debt to Gross Book Value*52.2 %51.2 %51.3 %
NAV per Unit*$16.10 $16.43 $16.62 
*These measures are not recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. For definitions, reconciliations and the basis of presentation of the REIT's non-GAAP measures, refer to section "Non-GAAP Measures".
**This figure includes the impact of the REIT’s option to extend the maturity of the Credit Facility by one year which is contingent upon, among other things, the REIT remaining in compliance with various covenants and the payment of a customary fee to extend the term.

Additional highlights, inclusive of material subsequent events include:
•On September 30, 2026, the REIT registered its securities with the U.S. Securities and Exchange Commission under Form 40-F; and
•On October 14, 2026, the REIT Units began trading on the New York Stock Exchange (“NYSE”) under the ticker symbol “BSRT”. In addition to trading and listing on the NYSE, the ticker symbol for the REIT's Canadian dollar-denominated listing on the Toronto Stock Exchange ("TSX") was concurrently changed from "HOM.UN" to "BSRT.UN". The REIT's U.S. dollar-denominated TSX listing, "HOM.U", was delisted at the close of business on October 13, 2026, the day prior to the effective date of the NYSE listing. Trading in the REIT’s OTC ticker “BSRTF” also ceased concurrent with the listing of units for trading on the NYSE.
Financial Summary for Q3 2026
Given the scale of the REIT's Property Acquisitions and Property Dispositions in 2025, the financial results depicted throughout this document are inherently dissimilar from the comparative year-to-date period. This is due to the stabilized nature of the Property Dispositions and the overall portfolio concentration and occupancy of the Non-Same Community properties as of September 30, 2026.
As the Property Acquisitions continue to improve their financial performance through stabilization, comparisons to prior periods will become more meaningful. However, even once stabilized, there will continue to be some inherent differences when comparing to the prior year results, with the exception of metrics presented on a “per Unit” basis, given that a portion of the Contribution Transaction was recapitalized through the cancellation of 15,000,000 Class B Units.
Total portfolio revenue of $34.5 million for Q3 2026 increased $1.4 million, or 4.3%, compared to $33.1 million for Q3 2025. The increase was primarily the result of $1.6 million of revenue generated from the Property Acquisitions, partially offset by the Same Community properties which reduced revenue by $0.1 million (discussed below). Total revenue resulting from the Property Acquisitions is expected to continue to improve in future periods as the lease-up and operational enhancements continue to progress through stabilization across the portfolio.
Sequentially, total portfolio revenue of $34.5 million for Q3 2026 increased $0.3 million, or 0.9%, compared to $34.2 million for Q2 2026, primarily due to the performance of the Property Acquisitions as they progress toward initial physical stabilization.
Same Community revenue of $26.4 million for Q3 2026 decreased $0.1 million, or 0.6%, compared to $26.5 million for Q3 2025, primarily due to a decrease of $0.2 million from lower average occupancy of 94.1% as of September 30, 2026 from 94.3% a year earlier September 30, 2025 and $0.1 million from lower average monthly in-place rent versus the comparative period. These revenue declines were partially offset by an increase in other property income of $0.2 million primarily related to the continued ramp-up of the REIT’s bulk internet initiative.
Sequentially, Same Community revenue of $26.4 million for Q3 2026 was flat compared to Q2 2026.



The following tables summarize the REIT's occupancy, average monthly rate and lease rate change, by MSA as of September 30, 2026 and 2025.
September 30, 2026September 30, 2025
MSANumber
of Units		Avg Rent Per UnitOccupancy RateNumber
of Units		Avg Rent Per UnitOccupancy Rate
Austin, TX1,079$1,485 95.6 %1,079$1,516 94.4 %
Dallas, TX1,3811,493 95.1 %1,3811,501 94.6 %
Houston, TX2,2361,515 93.5 %2,2361,540 94.9 %
Texas4,6961,502 94.5 %4,6961,523 94.7 %
Other Markets9531,093 92.2 %9531,076 92.2 %
Total Same Community5,6491,434 94.1 %5,6491,449 94.3 %
Non-Same Community1,5211,665 93.6 %1,5211,768 83.6 %
Total Portfolio7,170$1,483 94.0 %7,170$1,511 92.0 %
*The figures for Number of Units, Average Rent Per Unit and Occupancy Rate for Non-Same Community are presented for properties owned as of September 30, 2026 and September 30, 2025, respectively.

MSAEffective New Lease Rate Change for Q3 2026Effective Renewal Lease Rate Change for Q3 2026Effective Blended Lease Rate Change for Q3 2026
Austin, TX(3.2)%1.4 %(0.6)%
Dallas, TX(3.5)%1.8 %(0.1)%
Houston, TX(6.7)%3.2 %(1.3)%
Other Markets2.3 %4.1 %3.5 %
Total Same Community(4.4)%2.6 %(0.2)%
The rental change rates shown for Q3 2026 are calculated as the average percentage change over the prior lease for new or renewed leases during the quarter, excluding short term leases. The weighted average monthly rent on in-place leases for the Same Community portfolio was $1,434 per apartment unit as of September 30, 2026 compared to $1,449 as of September 30, 2025. During Q3 2026, excluding short term leases, rental rates for new leases and renewals changed (4.4)% and 2.6% respectively, resulting in a (0.2)% blended change over the prior lease rates. As the wave of supply in our core markets continues to be absorbed with minimal new product expected over at least the near future, management expects the general trajectory of blended rate changes to improve in the coming quarters.
The change in net (loss) income and comprehensive (loss) income between Q3 2026 and Q3 2025 is primarily due to non-cash fair value adjustments to derivatives and other financial liabilities and investment properties as well as a reduction in costs of dispositions of investment properties. As such, the net (loss) income and comprehensive (loss) income is not considered comparable period over period.
Sequentially, the change in net income (loss) and comprehensive income (loss) between Q3 2026 and Q2 2026 is primarily due to non-cash fair value adjustments to derivatives and other financial liabilities and investment properties and is not considered comparable.
Total portfolio NOI for Q3 2026 of $17.7 million increased $0.4 million, or 2.4%, from $17.3 million in Q3 2025. The increase was the result of contributions from the Property Acquisitions that increased NOI by $1.1 million, partially offset by Same Community properties which reduced NOI by $0.7 million (discussed below).
Sequentially, total portfolio NOI for Q3 2026 of $17.7 million decreased $0.2 million, or 1.1%, from $17.9 million in Q2 2026. The decrease was primarily the result of the decrease in Same Community NOI (discussed below).
Same Community NOI for Q3 2026 of $13.7 million decreased $0.7 million, or 4.5%, from $14.4 million in Q3 2025 and was attributable to a $0.4 million decrease in real estate tax refunds received, the decrease in Same Community revenue as described above of $0.1 million and higher overhead costs and administrative expenses of $0.3 million, partially offset by lower property insurance of $0.1 million.
Sequentially, Same Community NOI for Q3 2026 of $13.7 million decreased $0.2 million, or 1.5%, from $13.9 million in Q2 2026, primarily attributable to higher repair and maintenance expenses due to seasonality.



The table below summarizes the REIT's revenue and NOI results, by MSA, for Q2 2026 and Q2 2025:
Q3 2026Q3 2025$ Change$ Change% Change% Change
MSARevenueNOI *RevenueNOI *RevenueNOI *RevenueNOI *
Austin, TX$5,336 $3,022 $5,394 $2,685 $(58)$337 (1.1)%12.6 %
Dallas, TX6,814 3,352 6,790 3,361 24 (9)0.4 %(0.3)%
Houston, TX10,864 5,483 11,024 6,525 (160)(1,042)(1.5)%(16.0)%
Texas23,014 11,857 23,208 12,571 (194)(714)(0.8)%(5.7)%
Other Markets3,338 1,860 3,295 1,796 43 64 1.3 %3.6 %
Total Same Community26,352 13,717 26,503 14,367 (151)(650)(0.6)%(4.5)%
Non-Same Community8,168 4,019 6,591 2,945 1,577 1,074 23.9 %36.5 %
Total Portfolio$34,520 $17,736 $33,094 $17,312 $1,426 $424 4.3 %2.4 %
*These measures are not recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. For definitions, reconciliations and the basis of presentation of the REIT's non-GAAP measures, refer to section "Non-GAAP Measures".
FFO in Q3 2026 was $7.4 million, or $0.19 per Unit, compared to $7.6 million, or $0.19 per Unit, for Q3 2025. The decrease was related to (i) rising interest rates and associated rate resets within the REIT's derivatives portfolio and (ii) higher relative leverage levels (which was primarily related to the timing of Property Acquisitions and Property Dispositions). The decrease in FFO continued to be amplified during the quarter given the initial lease-up period of the August 2025 Acquisition and the resultant relative leverage levels of the REIT following the Property Acquisitions and Property Dispositions. These dynamics should normalize throughout the remainder of 2026 as the new properties continue to perform through stabilization.
Sequentially, FFO in Q3 2026 was $7.4 million, or $0.19 per Unit, compared to $7.1 million, or $0.18 per Unit, for Q2 2026. The increase was primarily related to a $0.5 million decrease in general and administrative expenses, partially offset by the decrease in NOI described above.
AFFO was $6.4 million, or $0.16 per Unit for Q3 2026 compared to $6.4 million, or $0.17 per Unit, for Q3 2025. The flat performance reflected the decrease in FFO and an increase in maintenance capital expenditures of $0.1 million, essentially offset by a $0.3 million improvement in the straight-line rental revenue adjustment related to the recognition of lease-up incentives over the life of the individual leases.
Sequentially, AFFO was $6.4 million, or $0.16 per Unit, for Q3 2026 compared to $5.9 million, or $0.15 per Unit, for Q2 2026. The increase was primarily due to lower maintenance capital expenditures of $0.3 million resulting from the timing of projects over the course of the year as well as the increase in FFO (described above).
NAV was $16.10 per Unit as of September 30, 2026 compared to $16.43 per Unit as of December 31, 2025.
Financial Summary for YTD 2026
Total portfolio revenue of $102.6 million for YTD 2026 decreased $7.7 million, or 7.0%, compared to $110.3 million for YTD 2025. The decrease was primarily the result of the Property Dispositions which reduced revenue by $18.5 million and a $0.8 million reduction from Same Community properties (discussed below), partially offset by $11.6 million of revenue generated from Property Acquisitions. Total revenue resulting from the Property Acquisitions is expected to continue to improve in future periods as the lease-up and operational enhancements continue to progress through stabilization across the portfolio.

Same Community revenue of $79.0 million for YTD 2026 decreased $0.8 million, or 1.0%, compared to $79.8 million for YTD 2025, primarily due to a decrease of $0.9 million from lower average occupancy and $0.5 million from lower average monthly in-place rent versus the comparative period. These revenue declines were partially offset by an increase in other property income of $0.6 million, driven by an increase in utility reimbursements and the bulk internet initiative.
The change in net income (loss) and comprehensive income (loss) between YTD 2026 and YTD 2025 is primarily due to non-cash fair value adjustments to derivatives and other financial liabilities and investment properties as well as a reduction in costs of dispositions of investment properties. As such, the net income (loss) and comprehensive income (loss) is not considered comparable period over period.
Total portfolio NOI for YTD 2026 of $53.3 million decreased $5.9 million, or 10.0%, from $59.2 million in YTD 2025. The decrease was the result of the Property Dispositions that reduced NOI by $10.5 million and a $1.7 million reduction from Same Community properties (discussed below), partially offset by a contribution of $6.3 million from Property Acquisitions.
Same Community NOI for YTD 2026 of $41.8 million decreased $1.7 million, or 4.0%, from $43.5 million in YTD 2025 and was attributable to the decrease in revenue of $0.8 million (described above), higher real estate taxes (net of refunds received) of $0.6 million, higher overhead costs and administrative expenses of $0.5 million and an increase in utility expenses of $0.2 million, partially offset by a decrease in property insurance expenses of $0.4 million.


The table below summarizes the REIT's revenue and NOI results, by MSA, for YTD 2026 and YTD 2025:
YTD 2026YTD 2025$ Change$ Change% Change% Change
MSARevenueNOI *RevenueNOI *RevenueNOI *RevenueNOI *
Austin, TX$15,940 $8,351 $16,465 $8,860 $(525)$(509)(3.2)%(5.7)%
Dallas, TX20,368 10,982 20,451 10,997 (83)(15)(0.4)%(0.1)%
Houston, TX32,800 16,828 33,079 18,088 (279)(1,260)(0.8)%(7.0)%
Texas69,108 36,161 69,995 37,945 (887)(1,784)(1.3)%(4.7)%
Other markets9,912 5,606 9,848 5,563 64 43 0.6 %0.8 %
Total Same Community79,020 41,767 79,843 43,508 (823)(1,741)(1.0)%(4.0)%
Non-Same Community23,530 11,510 30,424 15,684 (6,894)(4,174)(22.7)%(26.6)%
Total Portfolio$102,550 $53,277 $110,267 $59,192 $(7,717)$(5,915)(7.0)%(10.0)%
FFO was $21.4 million, or $0.55 per Unit, for YTD 2026 compared to $29.2 million, or $0.64 per Unit, for YTD 2025. The decrease was primarily related to the decrease in NOI described above, as well as higher finance costs of $1.5 million and higher general and administrative expenses of $0.4 million primarily due to legal and professional fees. The higher finance costs are primarily attributable to (i) rising interest rates and associated rate resets within the REIT's derivatives portfolio and (ii) higher relative leverage levels (which was primarily related to the timing of Property Acquisitions and Property Dispositions). The decrease in FFO was amplified during the quarter given the initial lease-up period of the August 2025 Acquisition and the resultant relative leverage levels of the REIT following the Property Acquisitions and Property Dispositions. These dynamics should normalize throughout the remainder of 2026 as the new properties continue to improve their financial performance through stabilization. The reduction in FFO was partially offset on a per Unit basis by the elimination of 15,000,000 Class B Units which were cancelled on April 30, 2025, in conjunction with the Contribution Transaction.
AFFO was $18.9 million, or $0.48 per Unit for YTD 2026 compared to $26.6 million, or $0.58 per Unit, for YTD 2025. The decrease in AFFO was primarily the result of the decrease in FFO and higher maintenance capital expenditures of $0.6 million, partially offset by a $0.7 million change in the straight-line rental revenue adjustment related to the recognition of lease-up incentives over the life of the individual leases. In addition, the reduction in AFFO was partially offset on a per Unit basis by the elimination of 15,000,000 Class B Units discussed above.
2026 Earnings and Same Community Portfolio Guidance
The REIT’s 2026 annual guidance is outlined below for FFO per Unit and AFFO per Unit, as well as year-over-year growth in Same Community revenue, property operating expenses and real estate taxes and NOI. Management reviews its base level assumptions and strategy on a quarterly basis to determine if any material change is warranted in the reported guidance. The REIT’s 2026 annual guidance is unchanged from the previous quarter.
Initial Guidance for 2026Revised Guidance for 2026
Per UnitRangeMidpointRangeMidpoint
Total Portfolio
FFO per Unit$0.75 to $0.79$0.77$0.73 to $0.77$0.75
AFFO per Unit$0.68 to $0.74$0.71$0.66 to $0.71$0.69
Same Community Growth
Total Revenue0.50% to 1.50%1.00%(0.75%) to 0.25%(0.25)%
Property Operating Expenses and Real Estate Taxes1.00% to 2.00%1.50%(1.50%) to (0.50%)(1.00)%
NOI0.00% to 1.00%0.50%0.00% to 1.00%0.50%
Liquidity and Capital Structure
As of September 30, 2026, the REIT had liquidity of $59.9 million, consisting of cash and cash equivalents of $4.1 million and $55.8 million available on its Credit Facility (defined below). The REIT can obtain additional liquidity through adding properties to the borrowing base.
The REIT's weighted average contractual interest rate on $378.7 million mortgage notes as of September 30, 2026 was 3.7% (including interest rate swap agreements) and its weighted average term to maturity was 3.1 years. Including the Credit Facility (defined below), total loans and borrowings were $730.9 million as of September 30, 2026, with a weighted average contractual interest rate of 4.1% (including interest rate swap agreements) and a weighted average term to maturity of 3.2 years. Debt to Gross Book Value as of September 30, 2026, was 52.2%. As of September 30, 2026, 100% of the REIT’s debt was fixed or economically hedged to fixed rates.

The REIT maintains a senior secured revolving credit facility provided by various banks (the “Credit Facility”) with a maximum revolving credit availability of $500.0 million, of which $412.4 million was available as of September 30, 2026. The Credit Facility is secured by twelve borrowing base properties. The Credit Facility matures on December 8, 2029 with a one-year extension option, at the REIT's election, to extend the maturity to December 8, 2030, subject to the satisfaction of certain conditions. The Credit Facility


currently bears interest at SOFR at a selected term of one-month, three-months or six-months plus a contractual margin adjustment based on the duration selected (“Adjusted Term SOFR”), as defined in the Credit Facility agreement, plus 1.30% to 1.90% based on meeting certain leverage ratios as defined in the Credit Facility agreement. Alternatively, the REIT has the ability to borrow using the greatest of (i) lender prime rate, (ii) the Fed Funds rate plus 0.5%, or (iii) 1-month SOFR plus 1.0% (the “Base Rate”) loans plus a rate equal to 0.30% to 0.90%. The balance outstanding on the Credit Facility was $356.6 million as of September 30, 2026 and $321.4 million as of December 31, 2025, at a variable interest rate of 5.6% and 5.3%, respectively.
Mortgage notes as of September 30, 2026 mature at various dates from 2027 through 2056.
Distributions and Units Outstanding
Cash distributions declared to holders of both Units and Class B Units totaled $5.4 million for Q3 2026, representing an AFFO Payout Ratio of 84.4%. 100% of the REIT’s cash distributions were classified as return of capital. As of September 30, 2026, the total number of Units outstanding was 34,030,696. There were also 4,713,152 Class B Units, which are redeemable for Units on a one-for-one basis, and 368,783 Deferred Units outstanding as of September 30, 2026, for a total non-weighted unit count of 39,112,631. These are weighted for the purpose of calculating FFO per Unit, AFFO per Unit and NAV per Unit as defined above.
Conference Call
Dan Oberste, Chief Executive Officer, and Tom Cirbus, Chief Financial Officer, will host a conference call for analysts and investors on Thursday, November 12th, 2026 at 12:00 pm (ET). To join the conference call without operator assistance, participants can register and enter their phone number at: https://registrations.events/easyconnect/8251191/recCMVM1vWt2zEC00/ to receive an instant automated call back. Alternatively, they can dial 647-932-3411 or 800-715-9871 to reach a live operator who will join them into the call. In addition, the call will be webcast live at: https://app.webinar.net/Z86l4kv2LWp.
A replay of the call will be available until Thursday, November 19th, 2026. To access the replay, dial 647-362-9199 or 800-770-2030 (Passcode: 8251191#). A transcript of the call will be archived on the REIT’s website.
About BSR Real Estate Investment Trust
BSR Real Estate Investment Trust is an internally managed, unincorporated, open-ended real estate investment trust established pursuant to a declaration of trust under the laws of the Province of Ontario. The REIT owns a portfolio of multifamily garden-style residential properties located in attractive primary markets in the Sunbelt region of the United States.
All comparisons are to the corresponding periods in the prior year. Results are presented in U.S. dollars. The Condensed Consolidated Interim Financial Statements and Management’s Discussion and Analysis as of and for Q3 2026 are prepared in accordance with the accounting standards issued by the International Accounting Standards Board (“IFRS Accounting Standards” or “GAAP”), and are available on the REIT’s website at www.bsrreit.com, www.sedarplus.ca and www.sec.gov.
Capitalized terms not herein defined have the meaning ascribed to them in the Management's Discussion and Analysis dated as of and for Q3 2026.
Non-GAAP Measures
“Same Community” corresponds to stabilized properties the REIT has owned for equivalent periods throughout Q3 2026 and Q3 2025. “Non-Same Community” properties include: Venue Craig Ranch Apartments, Forayna Vintage Park, Botanic Luxury Living, The Ownsby and Aura 35Fifty (collectively, the “Property Acquisitions”) and Bluff Creek Apartments, Cielo I, Cielo II, Retreat at Wolf Ranch, Auberry at Twin Creeks, Aura Benbrook, Lakeway Castle Hills, Satori Frisco, Vale Frisco and Wimberly (collectively, the “Property Dispositions”).
A reconciliation of Funds from Operations (“FFO”) and Adjusted Funds from Operations (“AFFO”) to net (loss) income and comprehensive (loss) income, as well as an expanded discussion of the components of FFO and AFFO, and a reconciliation of Net Asset Value (“NAV”) to Unitholders' equity can be found below. Calculations of FFO per Unit, AFFO per Unit and NAV per Unit include trust units of the REIT (“Units”), Class B Units of BSR Trust, LLC (“Class B Units”) and issued deferred units of the REIT granted to trustees (“Deferred Units”).
Same Community, NOI, NOI Margin, FFO, FFO per Unit, AFFO, AFFO per Unit, AFFO Payout Ratio, Debt to Gross Book Value, NAV and NAV per Unit are key measures of performance commonly used by real estate operating companies and real estate investment trusts. They are not measures recognized under and do not have standardized meanings prescribed by IFRS Accounting Standards. Same Community, NOI, NOI Margin, FFO, FFO per Unit, AFFO, AFFO per Unit, AFFO Payout Ratio, Debt to Gross Book Value, NAV and NAV per Unit as calculated by the REIT may not be comparable to similar measures presented by other issuers. For complete definitions of these measures, as well as an explanation of their composition and how the measures provide useful information to investors, please refer to the section titled “Non-GAAP Measures” in the REIT’s Management’s Discussion and Analysis for Q3 2026, which section is incorporated herein by reference.



Q3 2026Q2 2026Q3 2025YTD 2026YTD 2025
Net (loss) income and comprehensive (loss) income $(8,087)$(4,337)$2,874 $10,580 $(60,453)
Adjustments to arrive at FFO
Distributions on Class B Units665 668 724 2,005 4,973 
Fair value adjustment to investment properties20,929 9,641 6,510 22,002 9,440 
Real estate tax fair value adjustment under IFRIC 216,606 6,527 6,509 (5,760)(9,560)
Property tax liability adjustment, net (IFRIC 21)(6,606)(6,527)(6,509)5,760 9,560 
Fair value adjustment to derivatives and other financial liabilities(6,688)903 (2,582)(13,365)63,718 
Fair value adjustment to unit-based compensation(559)230 (233)(1,047)(271)
Transaction costs1,079 — — 1,079 — 
Costs of dispositions of investment properties13 — 284 74 11,759 
Principal payments on lease liability(22)(22)— (66)(36)
Depreciation of right-of-use asset30 30 — 90 33 
FFO$7,360 $7,113 $7,577 $21,352 $29,163 
FFO per Unit$0.19 $0.18 $0.19 $0.55 $0.64 
Adjustments to arrive at AFFO
Maintenance capital expenditures(966)(1,243)(895)(2,707)(2,113)
Straight line rental revenue differences40 65 (239)288 (443)
AFFO$6,434 $5,935 $6,443 $18,933 $26,607 
AFFO per Unit$0.16 $0.15 $0.17 $0.48 $0.58 
Distributions declared$5,432 $5,436 $5,416 $16,302 $19,050 
AFFO Payout Ratio84.4 %91.6 %84.1 %86.1 %71.6 %
Weighted average unit count39,128,617 39,131,352 39,023,496 39,119,744 45,572,408 

September 30, 2026December 31, 2025September 30, 2025
Loans and borrowings (current portion)$862 $28,752 $351,883 
Loans and borrowings (non-current portion)730,009 694,381 374,694 
Total loans and borrowings730,871 723,133 726,577 
Gross Book Value$1,401,444 $1,412,450 $1,417,211 
Debt to Gross Book Value52.2 %51.2 %51.3 %

September 30, 2026December 31, 2025September 30, 2025
Unitholders' equity$579,746 $581,964 $584,125 
Class B Units50,007 60,375 64,627 
NAV$629,753 $642,339 $648,752 
Unit count, as of the end of period39,112,631 39,100,614 39,040,149 
NAV per Unit$16.10 $16.43 $16.62 


Forward-Looking Statements
This news release contains “forward-looking information” as defined under Canadian securities laws (collectively, “forward-looking statements”). Forward-looking statements in this news release include, but are not limited to, statements which reflect management’s expectations regarding objectives, plans, goals, strategies, future growth metrics, results of operations, performance, business prospects, and opportunities for the REIT. The words “expects”, “expectation”, “anticipates”, “anticipated”, “believes”, “will” or variations of such words and phrases identify forward-looking statements herein. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events or circumstances. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the REIT’s control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. The REIT’s estimates, beliefs and assumptions, which may prove to be incorrect, include assumptions relating to the following: the intention of the REIT to pay, preserve, protect and grow Unitholders’ distributions; the intention of the REIT to execute its growth strategies and achieve its growth targets; the intention of the REIT to meet its interest payment obligations; the REIT’s competitive position within its industry; expectations regarding laws, rules and regulations applicable to the REIT; expectations regarding future Trustees and executive compensation levels and plans; expectations regarding tax treatment of the REIT and of the REIT’s distributions to Unitholders; expectations regarding industry and demographic trends; and expectations regarding the economic environment. Such forward-looking statements are qualified in their entirety by the inherent risks, uncertainties and changes in circumstances surrounding future expectations which are difficult to predict and many of which are beyond the control of the REIT.
Forward-looking statements are necessarily based on estimates and assumptions that, while considered reasonable by management of the REIT as of the date of this news release, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The REIT’s estimates, beliefs and assumptions, which may prove to be incorrect, include the various assumptions set forth herein, including, but not limited to, assumptions relating to the REIT’s future growth potential, results of operations, demographic and industry trends, no changes in legislative or regulatory matters, the tax laws as currently in effect, stability of the general economy over the intermediate term, lease renewals and rental increases, resident leasing patterns including the ability to re-lease or find new residents, the timing and the ability of the REIT to sell and acquire certain properties, project costs and timing, a continuing trend toward land use intensification at reasonable costs and development yields, including residential development in urban markets, access to equity and debt capital markets to fund, at acceptable costs, future capital requirements and to refinance debts as they mature, the availability of investment opportunities for growth in the REIT’s target markets, the valuations to be realized on property sales relative to current IFRS Accounting Standards carrying values, the market price of the Units, and the anticipated benefits of recent property acquisitions and dispositions.
When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements are qualified in their entirety by the inherent risks, uncertainties and changes in circumstances surrounding future expectations which are difficult to predict and many of which are beyond the control of the REIT. The risks and uncertainties that may impact such forward-looking information include, but are not limited to, impediments to the REIT’s ability to execute its growth strategies and operations, impediments to the REIT's ability to execute future acquisitions and dispositions, the impact of changing conditions in the U.S. multifamily housing market, increasing competition in the U.S. multifamily housing market, the effect of fluctuations and cycles in the U.S. real estate market, the marketability and value of the REIT’s portfolio, changes in the attitudes, financial condition and demand of the REIT’s demographic market, fluctuation in interest rates and volatility in financial markets, the impact of U.S. and global tariffs, developments and changes in applicable laws and regulations, the impact of climate change, fluctuations in the economic environment, the environmental, social and governance (ESG) landscape and the employment market (including from the impact of artificial intelligence), and such other factors discussed under the heading “Risk Factors” in the REIT’s Management’s Discussion and Analysis for Q3 2026 and Annual Information Form dated March 11, 2026 which are both available on the REIT’s profile on SEDAR+ (www.sedarplus.ca) and EDGAR (www.sec.gov). If any risks or uncertainties with respect to the above materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. The REIT does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law. This forward-looking information speaks only as of the date of this news release.
Certain statements included in this news release may considered “financial outlook” for purposes of applicable Canadian securities laws, including under the heading “2026 Earnings and Same Community Portfolio Guidance” herein. The financial outlook may not be appropriate for purposes other than to understand management’s current expectations relating to the future growth of the REIT, as disclosed in this news release. The REIT and management believe that financial outlook has been prepared on a reasonable basis, reflecting management’s best estimates and judgments as of the date of this news release. In particular, the REIT’s earnings guidance is supported by the following key assumptions: modest Same Community NOI growth driven by modest rate growth and advancement of select real estate adjacent business services internalization efforts, significant Non Same Community NOI growth driven primarily by the lease-up and full year impact of the REIT’s Property Acquisitions offset by the Property Dispositions, and higher net costs of borrowing. Please see above under the heading “2026 Earnings and Same Community Portfolio Guidance” for further details. Please note, such assumptions are inherently subject to significant business, economic, competitive, market, regulatory, and other risks and uncertainties as outlined above, many of which are beyond the REIT’s control. Actual results may differ materially from management’s expectations if any of the assumptions referred to above prove to be inaccurate. The REIT reviews its key assumptions regularly and may change its outlook on a going-forward basis if necessary.
All forward-looking statements and financial outlook are based only on information currently available to the REIT and are made as of the date of this news release. Except as expressly required by applicable Canadian securities law, the REIT assumes no obligation to publicly update or revise any forward-looking statement or financial outlook, whether as a result of new information, future events or otherwise. All forward-looking statements and financial outlook in this news release are qualified by these cautionary statements.
For further information, please contact:
Spencer Andrews, Vice President of Marketing and Investor Relations
BSR Real Estate Investment Trust
Tel:    501.371.6321


Form 52-109F2
Certification of Interim Filings
Full Certificate

I, Daniel M. Oberste, Chief Executive Officer of BSR Real Estate Investment Trust, certify the following:
1.    Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of BSR Real Estate Investment Trust (the “issuer”) for the interim period ended September 30, 2026.

2.     No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3.Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4.Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.

5.Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings

(a)     designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i)    material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii)    information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b)     designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.

5.1    Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the framework and criteria established by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control – Integrated Framework (2013).

5.2    ICFR – material weakness relating to design: N/A.
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5.3    Limitation on scope of design: N/A.
6.    Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on July 1, 2026 and ending on September 30, 2026 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.

Date: November 11, 2026

“Daniel M. Oberste”
____________________
Daniel M. Oberste
Chief Executive Officer
2


Form 52-109F2
Certification of Interim Filings
Full Certificate

I, Thomas Cirbus, Chief Financial Officer of BSR Real Estate Investment Trust, certify the following:
1.    Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of BSR Real Estate Investment Trust (the “issuer”) for the interim period ended September 30, 2026.

2.     No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3.Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4.Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.

5.Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings

(a)     designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i)    material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii)    information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b)     designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.

5.1    Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the framework and criteria established by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control – Integrated Framework (2013).

5.2    ICFR – material weakness relating to design: N/A.
1



5.3    Limitation on scope of design: N/A.
6.    Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on July 1, 2026 and ending on September 30, 2026 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.

Date: November 11, 2026

“Thomas Cirbus”
____________________
Thomas Cirbus
Chief Financial Officer



2