Dream Industrial REIT Reports Strong Q4 2025 and Year-End Financial Results

This press release contains forward-looking information that is based upon assumptions and is subject to risks and uncertainties as indicated in the cautionary note contained within this press release. All dollar amounts are in Canadian dollars unless otherwise indicated.

TORONTO–(BUSINESS WIRE)–Dream Industrial Real Estate Investment Trust (DIR.UN-TSX) or (the “REIT” or “Trust” or “Dream Industrial REIT” or “DIR” or “we” or “us”) today announced its financial results for the three months and year ended December 31, 2025. Management will host a conference call to discuss the financial results on February 18, 2026 at 11:00 a.m. (ET).

“Dream Industrial closed out 2025 with another year of strong performance achieving 5% FFO per Unit growth, while absorbing a 70 bps increase in our weighted average cost of debt as we refinanced over $800 million of low-cost debt to current rates. This resilience in our earnings was driven by strong CP NOI growth of 6%, contribution from developments, growing ancillary revenue and accretive acquisitions. Leasing momentum picked up meaningfully in the second half of 2025 leading to over 1 million square feet of development leasing and 10 million square feet transacted across our wholly-owned and managed portfolio for the full year,” said Alexander Sannikov, President & Chief Executive Officer of Dream Industrial REIT. “In addition to strong operating results, we meaningfully enhanced our access to capital in 2025. We completed or firmed up on approximately $850 million of dispositions at premiums to our prior carrying values, our balance sheet has strengthened, and our private capital partnerships business added further scale. These initiatives position us well to continue delivering solid results to our unitholders.”

HIGHLIGHTS

• Diluted funds from operations (“FFO”) per Unit⁽¹⁾ was $1.05 in 2025, a 4.9% increase when compared to $1.00 in 2024. For the quarter, diluted FFO per Unit was $0.27, a 5.3% increase when compared to $0.26 in Q4 2024.

• Comparative properties net operating income (“CP NOI”) (constant currency basis)⁽²⁾ increased by 5.7% to $404.9 million in 2025, when compared to $383.0 million in 2024. For the quarter, CP NOI (constant currency basis) increased by 8.4% to $107.1 million, when compared to $98.8 million in Q4 2024.

• In-place occupancy was 95.5% as at December 31, 2025 compared to 94.5% as at September 30, 2025. In-place and committed occupancy was 96.2% as at December 31, 2025 compared to 95.4% as at September 30, 2025.

• Leased over 1.2 million square feet across the Trust’s development projects during the year, including full lease-up of its 20-acre and 50-acre greenfield developments in Balzac, Alberta totalling 1 million square feet.

• Signed nearly 7.4 million square feet of new leases and renewals across the Trust’s wholly-owned portfolio at an average rental spread of 19.6% since the beginning of 2025 through January 31, 2026, driven by 35% spread in Ontario, 41% spread in Québec and 10% spread in Western Canada.

• Closed on approximately $610 million of acquisitions across the Trust’s wholly owned portfolio and private ventures during 2025 ($165 million at the Trust’s share), adding over 2 million square feet of GLA to the Trust’s owned and managed portfolio.

• Completed or substantially completed four wholly-owned development projects in 2025 at an expected average unlevered yield on cost of 6.3%, adding over 1.4 million square feet of GLA to the Trust’s portfolio.

• Net rental income was $385.0 million in 2025, a 8.3% increase when compared to $355.4 million in 2024, driven by 9.5% in Ontario, 4.5% in Québec, 14.7% in Western Canada and 10.5% in Europe, excluding disposed investment properties. For the quarter, net rental income was $100.2 million, a 9.6% increase when compared to $91.4 million in Q4 2024.

• Net income was $170.1 million in 2025, a decrease of $89.5 million when compared to $259.6 million in 2024. The net income in 2025 was comprised of net rental income of $385.0 million, interest expense on debt of $84.9 million, negative fair value adjustments to investment properties of $46.3 million across the portfolio, incentive fee payable related to disposition gains on the Initial DCI Portfolio of $44.8 million and other net expense of $38.9 million. For the quarter, net income was $30.2 million, compared to $109.6 million in Q4 2024.

• Total assets were $8.4 billion as at December 31, 2025, a 3.9% increase when compared to $8.1 billion as at December 31, 2024, driven by an increase in investment property value due to acquisitions, investments in the Dream Summit JV (the “DSI JV”)⁽³⁾ and the U.S. Fund⁽⁴⁾, development projects and foreign exchange translation adjustments, partially offset by the disposition of certain non-core assets.

1. Diluted FFO per Unit is a non-GAAP ratio. For further information on this non-GAAP ratio, please refer to the statements under the heading “Non-GAAP financial measures, ratios and supplementary financial measures” in this press release.
2. CP NOI (constant currency basis) is a non-GAAP financial measure. The tables included in the Appendices section of this press release reconcile this non-GAAP financial measure with its most directly comparable IFRS financial measure. For further information on this non-GAAP financial measure, please refer to the statements under the heading “Non-GAAP financial measures, ratios and supplementary financial measures” in this press release.
3. A joint venture between GIC and the Trust in which the Trust has a 10% interest.
4. A private U.S. industrial fund for which the Trust provides property management, construction management and leasing services at market rates in which the Trust has a 29.9% ownership interest.

FINANCIAL HIGHLIGHTS

ORGANIC GROWTH

• Continued strong leasing momentum at attractive rental spreads – From October 1, 2025 through to January 31, 2026, the Trust has transacted over 2.1 million square feet of leases across its wholly-owned portfolio at a weighted average rental rate spread of 14.3% over prior or expiring rents.

• In Canada, the Trust signed over 1.6 million square feet of leases, achieving a weighted average rental rate spread to expiry of 17.0% and an average annual contractual rent growth of 2.8%.

• In Europe, the Trust signed over 0.5 million square feet of leases, achieving a weighted average rental rate spread to expiry of 5.3%. All of the leases are fully indexed to local consumer price indices (“CPI”) or have contractual rent steps.

From January 1, 2025 through to January 31, 2026, the Trust has transacted nearly 7.4 million square feet of leases across its wholly-owned portfolio at a weighted average rental rate spread to expiry of 19.6%.

The Trust’s average in-place and committed rents in Canada have grown by 12% since the start of this year to December 31, 2025. As at December 31, 2025, estimated market rents exceeded the average in-place and committed rents by 16.2% and 4.1% across the Trust’s wholly-owned portfolio in Canada and Europe, respectively. Along with capturing substantial rental rate growth, the Trust systematically adds contractual annual rental rate escalators to its leases resulting in consistently growing CP NOI (constant currency basis) over time. Currently, the average contractual annual rental rate growth embedded in the Trust’s wholly-owned Canadian portfolio equates to approximately 3%. In the Trust’s wholly-owned European portfolio, approximately 85% of the leases are indexed to the local CPI with the remainder of the portfolio having contractual rent steps.

• Solid pace of CP NOI (constant currency basis)⁽¹⁾ growth – CP NOI (constant currency basis) for the three months and year ended December 31, 2025 was $107.1 million and $404.9 million, respectively. For the same periods in 2024, CP NOI (constant currency basis) was $98.8 million and $383.0 million, respectively. This represents an increase of 8.4% and 5.7% for the three months and year ended December 31, 2025, respectively, compared to the prior year comparative periods.

  The Canadian portfolio posted year-over-year CP NOI (constant currency basis) growth of 12.3% for the three months ended December 31, 2025, driven by 9.8%, 17.7% and 11.7% CP NOI growth in Ontario, Québec and Western Canada, respectively. For the year, CP NOI (constant currency basis) growth was 8.2% compared to 2024, driven by 10.0%, 6.7% and 5.9% CP NOI growth in Ontario, Québec and Western Canada, respectively. Overall, in-place base rents for the Canadian portfolio increased by 11.6% and 11.5% for the three months and year ended December 31, 2025, respectively.

  In Europe, year-over-year CP NOI (constant currency basis) increased by 2.5% and 2.4% for the three months and year ended December 31, 2025, respectively. The increase was driven by higher rental rates on new and renewed leases, in addition to CPI indexation.

• Healthy occupancy levels – The Trust’s in-place occupancy across its wholly-owned and managed portfolio (at the Trust’s share) improved to 95.5% as at December 31, 2025, compared to 94.5% as at September 30, 2025, reflecting healthy leasing momentum and disposition activity.

  The Trust’s in-place and committed occupancy across its wholly-owned and managed portfolio (at the Trust’s share) was 96.2% as at December 31, 2025, compared to 95.4% as at September 30, 2025. The Trust continues to be in active discussions with prospective tenants and it expects significant opportunities to capture strong income growth as spaces are leased.

• Continued growth in net rental income for the quarter – Net rental income for the three months and year ended December 31, 2025 was $100.2 million and $385.0 million, respectively, representing an increase of $8.7 million or 9.6%, and $29.6 million or 8.3%, respectively, relative to the comparative prior year periods. For the quarter, year-over-year net rental income increased by 5.9% in Ontario, 8.7% in Québec, 19.6% in Western Canada and 13.6% in Europe, excluding disposed investment properties. The increase was mainly driven by strong CP NOI (constant currency basis) growth over the past year, and lease-up at the Trust’s development projects.

DISPOSITIONS UPDATE

During the quarter, the Trust disposed of a non-strategic asset located in Edmonton, Alberta, for $4.7 million.

As previously announced, the Trust has agreed to sell a portfolio of 11 wholly-owned Canadian industrial assets (27 buildings) totalling 3.6 million square feet across Ontario, Québec and Alberta (the “Initial DCI Portfolio”) to the newly formed joint venture with CPP Investments (the “DCI JV”). The DCI JV has agreed to acquire the Initial DCI Portfolio for a purchase price of $805 million on an unencumbered basis. The Trust held the assets in the Initial DCI Portfolio for over 10 years on average, generating an unlevered internal rate of return in excess of 10% over this period. At the proposed sale price for the 90% interest in the Initial DCI Portfolio, this transaction will generate a gain of $316.8 million relative to the Initial DCI Portfolio’s historical cost basis. With this venture, the Trust will be able to significantly accelerate progress on its capital recycling strategy.

On February 5, 2026, the Trust closed the first tranche sale to the DCI JV for estimated net proceeds of $375 million, with this tranche comprising six industrial assets (22 buildings) totalling 1.9 million square feet. The Trust expects to close the second tranche comprising the remaining assets by the end of H1 2026.

Subsequent to the quarter, the Trust also completed the sale of another non-strategic asset located in the Greater Toronto Area (“GTA”) West, Ontario, for $17.5 million or approximately $374 per square foot.

ACQUISITIONS UPDATE

During the quarter, the Trust closed on the previously announced acquisition of a 130,000 square foot asset located near Osnabrück in Germany, which included a rooftop solar system, for a purchase price of $12.9 million.

In December, the Trust acquired a 65,000 square foot asset located in Germany for a purchase price of $8.3 million. This fully-occupied asset represents a going-in cap rate of over 6% and a mark-to-market cap rate exceeding 7%. Situated on a 3.1-acre site, the building features a functional design that supports a wide range of occupiers and can be demised for last mile operations, with excess land partly being used by the existing tenant for outdoor storage, and offers future value creation opportunities.

As previously disclosed, the DSI JV completed the acquisition of an asset in Calgary, Alberta, for a purchase price of $34.5 million ($3.4 million at DIR’s share) during the fourth quarter.

DEVELOPMENT AND DEVELOPMENT LEASING UPDATE

During the quarter, the Trust substantially completed its 389,000 square foot redevelopment project in the GTA East. The new state-of-the-art industrial facility is comprised of two buildings featuring an efficient and flexible design with 40-foot clear height, energy-efficient LED lighting and targeting LEED certifications. Strategically located with excellent connectivity, the buildings offer immediate access to key transportation corridors, including Highways 401, 412, 407 and 418.

Substantially completed redevelopment in Whitby, Ontario

The Trust continues to see healthy leasing pipeline for its development projects. During the quarter, the Trust signed or commenced occupancy on 0.5 million square feet of leases across its 20-acre and 50-acre Balzac developments in Calgary, Alberta. With both greenfield developments which total one million square feet, now fully leased, the Trust achieved a 6.1% weighted average unlevered yield on cost and expects these assets to contribute over $10 million of annual NOI on a run-rate basis.

SOLAR PROGRAM UPDATE

The Trust continues to advance its solar program with the installation of rooftop solar panel installations across 33 projects in Canada, the Netherlands and Germany, representing 26 megawatts of renewal power generation. The Trust has deployed approximately $32 million into these projects achieving an estimated unlevered yield on cost of 12%.

During the quarter, the Trust substantially completed five projects in Canada including the repowering and upgrade of an existing rooftop solar system at an asset in the GTA with an expected yield on cost of over 23%. In Europe, the Trust completed the construction of a project in the Netherlands, adding over 1,100 panels with an expected yield on cost of 10% and acquired a building with an existing rooftop solar system in Germany.

Furthermore, the Trust is presently under construction on six projects at a weighted average expected yield on cost of 10%. Over the near to medium-term, the Trust has identified over 120 MW of additional solar generation potential within its portfolio, translating into over $190 million of potential additional investment volume at a targeted yield on cost of over 8% over the near to medium-term.

CAPITAL STRATEGY

The Trust received an issuer rating and senior unsecured debentures credit rating upgrade to BBB (high) with Stable trends, from BBB (mid), assigned by Morningstar DBRS (“DBRS”). Following the upgrade in November 2025, the Trust achieved a reduction in the cost of borrowing on its $750 million unsecured revolving credit facility, US$250 million unsecured term loan, $200 million unsecured term loan and €153 million unsecured term loan.

During the quarter, the Trust repaid its $450 million Series A Debentures by temporarily utilizing its unsecured revolving credit facility. Effective December 22, 2025, the Trust’s $200 million Series G Debentures issued in July 2025 were swapped to euros at an effective fixed interest rate of 3.726% per annum.

In conjunction with the announcement of the sale of the Initial DCI Portfolio to the DCI JV, the Trust suspended its Distribution Reinvestment and Unit Purchase Plan (the “DRIP”) effective as of the distribution payable on January 15, 2026 to unitholders of record as at December 31, 2025. The DRIP will remain suspended until further notice and distributions of the Trust will be paid only in cash going forward. Upon reinstatement of the DRIP, plan participants enrolled in the DRIP at the time of its suspension who remain enrolled at the time of its reinstatement will automatically resume participation in the DRIP.

Additionally, The Trust expects to deploy a portion of the proceeds from the sale of the Initial DCI Portfolio towards unit buybacks. Since the announcement of the DCI JV and up to February 13, 2026, the Trust purchased for cancellation 2,444,964 REIT Units under its normal course issuer bid at a weighted average price of $13.08 per REIT Unit for a gross amount of $32.0 million.

The Trust continues to maintain significant financial flexibility as it executes on its strategic initiatives. The Trust’s proportion of secured debt⁽¹⁶⁾ was 5.3% of total assets and represents 13.6% of total debt⁽¹⁷⁾. The Trust’s unencumbered asset pool⁽¹¹⁾ totalled $6.3 billion as at December 31, 2025, representing 84.4% of the Trust’s total investment properties value as at December 31, 2025.

The Trust’s net total debt-to-normalized adjusted EBITDAFV ratio was 7.9x and net total debt-to-total assets (net of cash and cash equivalents) ratio was 38.4% as at December 31, 2025.

The Trust ended Q4 2025 with available liquidity⁽¹²⁾ of $338.5 million, including $41.4 million of cash and cash equivalents, and an additional $250 million that could be exercised through the accordion on its unsecured revolving credit facility. Following the vend-in of the first tranche of the Initial DCI Portfolio to the DCI JV, the net proceeds were immediately utilized to repay the majority of the outstanding balance on the Trust’s unsecured revolving credit facility and the Trust expects to allocate the remaining proceeds towards a combination of unit buybacks and strategic growth initiatives on an accretive basis.

“We achieved solid fourth quarter and full year results. Our recent credit rating upgrade underscores the strength of our urban industrial portfolio and credit quality, which reduces our incremental cost of borrowing as we look to refinance our upcoming debt maturities,” said Lenis Quan, Chief Financial Officer of Dream Industrial REIT. “Pro forma the repayment of our credit facility draws with the sale proceeds from the DCI JV, our total available liquidity of over $700 million provides us with the financial flexibility to continue executing on our strategic initiatives.”

CONFERENCE CALL

Senior management will host a conference call to discuss the financial results on Wednesday, February 18, 2026, at 11:00 a.m. (ET). To access the conference call, please dial 1-800-715-9871 in Canada or 647-932-3411 elsewhere. To access the conference call via webcast, please go to Dream Industrial REIT’s website at www.dreamindustrialreit.ca and click on the link for News, then click on Events. A taped replay of the conference call and the webcast will be available for ninety (90) days following the call.

Other information

Information appearing in this press release is a select summary of financial results. The consolidated financial statements and management’s discussion and analysis for the Trust will be available at www.dreamindustrialreit.ca and on www.sedarplus.ca.

Dream Industrial REIT is an owner, manager and operator of a global portfolio of well-located, diversified industrial properties. As at December 31, 2025, the REIT has an interest in and manages a portfolio which comprises 342 industrial assets (555 buildings) totalling approximately 73.6 million square feet of gross leasable area in key markets across Canada, Europe, and the U.S. The REIT’s objective is to deliver strong total returns to its unitholders through secure distributions as well as growth in net asset value and cash flow per unit underpinned by its high-quality portfolio and an investment grade balance sheet. Dream Industrial REIT is an unincorporated, open-ended real estate investment trust. For more information, please visit www.dreamindustrialreit.ca.

FOOTNOTES

1. CP NOI (constant currency basis) is a non-GAAP financial measure. The most directly comparable financial measure to CP NOI (constant currency basis) is net rental income. The table included in the Appendices section of this press release reconcile CP NOI (constant currency basis) for the three months and years ended December 31, 2025 and December 31, 2024 to net rental income. For further information on this non-GAAP measure, please refer to the statements under the heading “Non-GAAP financial measures, ratios and supplementary financial measures” in this press release.
2. FFO is a non-GAAP financial measure. The most directly comparable financial measure to FFO is net income. The tables included in the Appendices section of this press release reconcile FFO for the three months and years ended December 31, 2025 and December 31, 2024 to net income. For further information on this non-GAAP measure, please refer to the statements under the heading “Non-GAAP financial measures, ratios and supplementary financial measures” in this press release.
3. Diluted FFO per Unit and FFO payout ratio are non-GAAP ratios.

Contacts

For further information, please contact:

Dream Industrial REIT

Alexander Sannikov
President & Chief Executive Officer

(416) 365-4106

[email protected]

Lenis Quan
Chief Financial Officer

(416) 365-2353

[email protected]

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