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GRANITE REIT 77 King St. W. , Suite 4010 P.O. Box 159 Toronto , Ontario Canada M5K 1H1 GRANITE ANNOUNCES 2021 SECOND QUARTER RESULTS , THE CLOSING OF $ 198 MILLION OF ACQUISITIONS AND DEVELOPMENTS , THE APPOINTMENT OF A NEW TRUSTEE , AND THE ISSUANCE OF ITS 2020 GLOBAL ESG + R REPORT August 4 , 2021 , Toronto , Ontario , Canada — Granite Real Estate Investment Trust and Granite REIT Inc. ( TSX : GRT.UN ; NYSE : GRP.U ) ( " Granite " or the " Trust " ) announced today its combined results for the three and six month periods ended June 30 , 2021 and also announced the closing of the acquisitions of three income - producing properties and a development property in the United States at a combined purchase price of $ 198 million , including committed development costs . Further , Granite announced that it has appointed Ms. Emily Pang to its Board of Trustees and Board of Directors and today released its 2020 Environmental , Social , Governance + Resilience ( ESG + R ) Report . SECOND QUARTER 2021 HIGHLIGHTS Highlights for the three month period ended June 30 , 2021 , including events subsequent to the quarter , are set out below : Financial : ● ● Granite's net operating income ( " NOI " ) was $ 80.3 million in the second quarter of 2021 compared to $ 71.2 million in the prior year period , an increase of $ 9.1 million primarily as a result of acquisition activity beginning in the second quarter of 2020 ; Same property NOI — cash basis ( 4 ) increased by 2.9 % for the three month period ended June 30 , 2021 , excluding the impact of foreign exchange ; Funds from operations ( " FFO " ) ( ¹ ) was $ 62.2 million ( $ 0.99 per unit ) in the second quarter of 2021 compared to $ 53.5 million ( $ 0.97 per unit ) the second quarter of 2020 ; Adjusted funds from operations ( " AFFO " ) ( ² ) was $ 60.1 million ( $ 0.96 per unit ) in the second quarter of 2021 compared to $ 51.3 million ( $ 0.93 per unit ) in the second quarter of 2020 ; AFFO payout ratio ( ³ ) was 79 % for the second quarter of 2021 compared to 78 % in the second quarter of 2020 ; Granite recognized $ 308.0 million in net fair value gains on investment properties in the second quarter of 2021 driven by lower capitalization rates and terminal capitalization rates and / or higher market rents observed across Granite's portfolio , but largely attributable to the Greater Toronto Area and U.S.A. The fair value gains on investment properties were partially offset by unrealized foreign exchange losses of $ 43.0 million resulting from the relative strengthening of the Canadian dollar against the US dollar and the Euro ; and Granite's net income attributable to stapled unitholders increased to $ 316.9 million in the second quarter of 2021 from $ 75.7 million in the prior year period primarily due to a $ 273.5 million increase in net fair value gains on investment properties and a $ 9.1 million increase in net operating income as noted above , partially offset by a $ 44.6 million increase in income tax expense .