RioCan Real Estate Investment Trust Completes Sale of Quartiers
Dix/30 and Provides an Update on Recent Dispositions and Liquidity
Enhancement Activities
TORONTO, ONTARIO--(Marketwired - Jan 13, 2014) - RioCan Real
Estate Investment Trust ("RioCan") (TSX:REI.UN) today is pleased to
provide an update on its capital recycling program and recent
financing activities. RioCan's capital recycling program is serving
to increase portfolio concentration in Canada's six largest
markets. In addition, RioCan expects to add $215 million of
additional capacity to its operating facilities to a total of $644
million, which will further improve the Trust's liquidity
profile.
Edward Sonshine, Chief Executive Officer of the Trust said, "The
proceeds generated through RioCan's asset sales have been
effectively redeployed to improve RioCan's internal growth by
investing in our development and redevelopment portfolio, the
acquisition of higher growth assets in Canada and the United
States, as well as ensuring that we maintain a conservative debt
profile.
Through the sale of some of our lower growth properties and
assets that require disproportionally higher demands on management,
we can better devote our human capital towards projects that we
believe will generate greater returns for the Trust.
Also, given the substantial growth of RioCan over the past five
years, management felt that it was prudent to increase RioCan's
credit facilities in order to provide enhanced liquidity. The added
flexibility afforded to RioCan through the increased and extended
lines of credit, in combination with our sizeable unencumbered
asset portfolio, is a powerful tool that RioCan is able to utilize.
This added liquidity also ensures that RioCan has the capital
available to pursue its development and acquisition opportunities
as they arise."
Disposition and Capital Recycling Program Update
In 2013, as part of RioCan's program to recycle capital into the
acquisition of higher growth assets in Canada's six major markets
and the Trust's development pipeline, RioCan completed the sale of
thirteen Canadian properties at a total sale price of $616 million
at a weighted average capitalization rate of 5.9%. The total debt
associated with these assets was $159 million.
On December 17, 2013, RioCan completed the sale of its 50% share
in Quartiers Dix/30, a 581,121 square foot new format retail
property in Brossard, Quebec, to its partner Devimco at a sale
price of $193 million, which equates to a capitalization rate of
5.4%. The partner assumed RioCan's share of the outstanding debt on
the property of $92 million that carried a weighted average
interest rate of 4.8%. The outstanding debt had a weighted average
term to maturity of approximately 3.7 years.
On December 2, 2013, RioCan sold The Brick Plaza, a 49,079
square foot non-grocery anchored retail centre in Windsor, Ontario
at a sale price of $2 million. The property was sold free and clear
of financing.
RioCan has also entered into a firm contract where conditions
have been waived to sell Mega Centre Beauport, located in Quebec
City, Quebec at a sale price of $47 million, which equates to a
capitalization rate of 6.0%. The property will be sold free and
clear of financing. Mega Centre Beauport is a 183,130 square foot
new format retail centre that is tenanted by Cineplex, Sports
Experts and Future Shop. The sale is expected to be completed in
the first quarter of 2014.
RioCan has entered into a firm contract where conditions have
been waived to sell Madawaska Centre, located in Edmundston, New
Brunswick at a sale price of $0.9 million. The property will be
sold free and clear of financing. Madawaska Centre is a 271,924
square foot enclosed mall, which was formally anchored by Zellers,
and is tenanted by Staples, Bargain Giant, Dollarama and Mark's
Work Wearhouse.
Recent Financing Activities
In the fourth quarter of 2013, RioCan renegotiated the terms of
two of its operating lines by increasing the capacity of the
facilities, extending the maturity dates, and reducing the interest
rate spreads associated with these facilities as follows:
Operating Line as of Sept. 30, 2013 (millions) |
Spread* |
Maturity |
Operating Line as of Dec. 31, 2013 (millions) |
Revised Spread* |
Revised Maturity |
$125 |
BA's/LIBOR +150 bps |
Dec. 2013 |
$185 |
BA's/LIBOR +125 bps |
Dec. 2016 |
$200 |
BA's/LIBOR +150 bps |
Nov. 2014 |
$250 |
BA's/LIBOR +125 bps |
Nov. 2016 |
* Lines are available in Canadian or US Dollars.
Canadian draws are priced off of BA's and US draws are priced off
of LIBOR. |
RioCan is also in the process of renegotiating a third existing
operating facility and adding a fourth operating line. It is
anticipated that the existing line will be increased from $100
million to $130 million and the new facility will have a capacity
of $75 million; both are expected to have pricing similar to
RioCan's other operating lines and maturity dates of June 2017.
RioCan expects that these facilities will be in place during the
first quarter of 2014.
When complete, RioCan will have access to $644 million under its
credit facilities. The reduced costs and the extended maturity
dates for RioCan's lines will provide an efficient and flexible
source of liquidity for the Trust. Based on September 30, 2013 fair
values, at December 31, 2013, RioCan had approximately $2.0 billion
of unencumbered assets, an increase of $19 million from September
30, 2013.
About RioCan
RioCan is Canada's largest real estate investment trust with a
total capitalization of approximately $13.6 billion as at September
30, 2013. It owns and manages Canada's largest portfolio of
shopping centres with ownership interests in a portfolio of 346
retail properties containing more than 83 million square feet,
including 51 grocery anchored and new format retail centres
containing 14 million square feet in the United States as at
September 30, 2013. RioCan's portfolio also includes 15 properties
under development in Canada. For further information, please refer
to RioCan's website at www.riocan.com.
Forward-Looking Advisory
This News Release contains forward-looking statements within the
meaning of applicable securities laws. These statements include,
but are not limited to, statements made in this News Release
(including the sections entitled, "Disposition and Capital
Recycling Program Update" and "Recent Financing Activities")
concerning RioCan's, intention to complete the disposition of
certain assets, increases to its operating facilities, as well as
other statements concerning RioCan's objectives, its strategies to
achieve those objectives, as well as statements with respect to
management's beliefs, plans, estimates, and intentions, and similar
statements concerning anticipated future events, results,
circumstances, performance or expectations that are not historical
facts. Forward-looking statements generally can be identified by
the use of forward-looking terminology such as "objective", "may",
"will", "expect", "intend", "should", "continue", or similar
expressions suggesting future outcomes or events.
These forward-looking statements are not guarantees of future
events or performance and, by their nature, are based on RioCan's
current estimates and assumptions, which are subject to risks and
uncertainties, including those described under "Risks and
Uncertainties" in RioCan's Management's Discussion and Analysis for
the period ended September 30, 2013 and in RioCan's annual
information form dated March 28, 2013, which could cause actual
events or results to differ materially from the forward-looking
statements contained in this News Release. Those risks and
uncertainties include, but are not limited to, those related to:
liquidity and general market conditions, tenant concentrations,
occupancy levels and defaults, access to debt and equity capital,
interest rates, joint ventures/partnerships, the relative
illiquidity of real property, unexpected costs or liabilities
related to acquisitions, construction, environmental matters, legal
matters, reliance on key personnel, unitholder liability, income
taxes, United States of America ("US") investment and currency
risk, and RioCan's qualification as a real estate investment trust
for tax purposes. Material factors or assumptions that were applied
in drawing a conclusion or making an estimate set out in the
forward-looking information may include, but are not limited to: a
stable retail environment; relatively low and stable interest
costs; a continuing trend toward land use intensification in high
growth markets; access to equity and debt capital markets to fund,
at acceptable costs, the future growth program to enable the Trust
to refinance debts as they mature; the availability of purchase
opportunities for growth in Canada and the US. Although the
forward-looking information contained in this News Release is based
upon what management believes are reasonable assumptions, there can
be no assurance that actual results will be consistent with these
forward-looking statements. Certain statements included in this
News Release may be considered "financial outlook" for purposes of
applicable securities laws, and such financial outlook may not be
appropriate for purposes other than this News Release.
The Income Tax Act (Canada) contains provisions which
potentially impose tax on publicly traded trusts (the "SIFT
Provisions"). However, the SIFT Provisions do not impose tax on a
publicly traded trust which qualifies as a real estate investment
trust ("REIT"). RioCan currently qualifies as a REIT and intends to
continue to qualify for future years. Should this not occur,
certain statements contained in this News Release may need to be
modified.
Except as required by applicable law, RioCan under takes no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
RioCan Real Estate Investment TrustRags DavloorExecutive Vice
President & CFO(416) 642-3554www.riocan.com
Grafico Azioni RioCan Real Estate Inves... (TSX:REI.UN)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni RioCan Real Estate Inves... (TSX:REI.UN)
Storico
Da Set 2023 a Set 2024