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RIOCAN
RioCan Investor Presentation
PRESENTATION
2015
First Quarter 2015
June 5, 2015
Xxxxxxx
Xxxxxx
February 25, 2015
Non-GAAP Measures
RioCan’s consolidated financial statements are prepared in accordance with IFRS. Consistent
with RioCan’s management framework, management uses certain financial measures to
assess RioCan’s financial performance, which are not generally accepted accounting
principles (GAAP) under IFRS.
The following measures, RioCan’s Interest, Funds From Operations (“FFO”), Adjusted FFO,
Operating Funds From Operations (“Operating FFO”), Net Operating Income (“NOI”),
Adjusted Earnings before interest, taxes, depreciation and amortization (“Adjusted
EBITDA”), Operating EBITDA, Net Consolidated Debt to Adjusted EBITDA, Net Operating
Debt to Operating EBITDA, Adjusted Unitholders Equity, Same Store NOI, and Same
Property NOI, and Total Enterprise Value as well as other measures discussed elsewhere in
this presentation, do not have a standardized definition prescribed by IFRS and are,
therefore, unlikely to be comparable to similar measures presented by other reporting
issuers.
Non GAAP measures should not be considered as alternatives to net earnings or
comparable metrics determined in accordance with IFRS as indicators of RioCan’s
performance, liquidity, cash flow, and profitability. For a full definition of these measures,
please refer to the “Non-GAAP Measures” in RioCan’s Management’s Discussion and
Analysis for the period ended March 31, 2015. RioCan uses these measures to better assess
the Trust’s underlying performance and provides these additional measures so that
investors may do the same.
2
Forward Looking Statements
Certain information included in this presentation contains forward-looking statements within the
meaning of applicable securities laws including, among others, statements concerning our
objectives, our 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. Certain material factors, estimates or assumptions were applied in drawing a
conclusion or making a forecast or projection as reflected in these statements and actual results
could differ materially from such conclusions, forecasts or projections.
Additional information on the material risks that could cause our actual results to differ materially
from the conclusions, forecast or projections in these statements and the material factors,
estimates or assumptions that were applied in drawing a conclusion or making a forecast or
projection as reflected in the forward-looking information can be found in our annual information
form and annual report that are available on our website and at www.sedar.com.
Except as required by applicable law, RioCan undertakes no obligation to publicly update or revise
any forward-looking statement, whether as a result of new information, future events or
otherwise.
3
One of North America’s Largest Retail
REITS
79 million
353
sqft total portfolio
retail properties
in Canada & U.S.
54 million
sqft owned
$
9.2 billion
$
market cap
16.2 billion
enterprise value
~7,600
tenancies
~86%
revenue generated by
national and anchor
tenants
4
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
Core Strengths
Dominant platform, geographically diversified
Conservative balance sheet / financial strength
Strong, reliable distribution yield provided to investors
Stable, diversified portfolio of national retail tenants
Disciplined growth strategy in Canada and U.S.
Positioned to benefit from robust development pipeline and acquisitions
Experienced, performance driven management team
5
Property Portfolio
GTA
BC
AB
MB
SA
QC
ON
NFLD
QC
NB
305
retail properties
44 million sqft
84%
annualized rental
revenue
48
MA
CT
retail properties
PA
10 million sqft
16%
VA
annualized rental
revenue
TX
As at March 31, 2015 at RioCan’s interest
6
Property Portfolio – Canada
Annualized Rental Revenue by Major Market
Rest of
Canada,
26.7%
BC
3.7%
Major
markets
combined,
73.6%
5.9% 4.2%
AB
Vancouver
Edmonton
Calgary
QC
ON
6.5%
10.7%
42.7% Ottawa
Montreal
Toronto
7
7
Property Portfolio – U.S.
Regional Market Strategy & Focus
Annualized Rental Revenue by State
2.1%
2.6%
20.3%
48
2.5%
NY
retail properties
1.8%
0.7%
RI
NJ
PA
10 million sqft
NH
MA
CT
55.2%
TX
As at March 31, 2015 at RioCan’s interest
VA
U.S.
15.6%
3.6%
MD
WV
Annualized Rental Revenue
7.0%
Canada
84.4%
1.7%
2.5%
8
8
Property Portfolio – U.S.
High quality assets with a focus towards grocery anchored centres
Shaw’s Plaza, Raynham, MA
Loyal Plaza, Williamsport, PA
Stop N Shop Plaza, Bridgeport, CT
Town Square Plaza, Reading, PA
Alamo Ranch, San Antonio
Riverpark, Houston
9
Property Type Mix – Canada
By Annualized Rental Revenue
As at March 31, 2015
Office, 5.1%
Urban Retail, 8.4%
New Format Retail,
43.7%
Enclosed Shopping
Centre, 17.2%
Non-Grocery Anchor,
4.8%
Grocery Anchored
Centre, 20.8%
10
Strong Tenant Relationships
11
11
Strong Tenant Relationships
Top 10 Canada & US Combined
As at March 31, 2015
Top 10 Tenant Name
1
2
3
4
5
6
7
8
9
10
(i)
(ii)
(iii)
Annualized
Rental
Revenue
Number Of
Locations
Total Area
Occupied
(Sq. Ft. In
000s)
Weighted Avg
Remaining
Lease Term
(Yrs)
Loblaws/Shoppers Drug Mart (i)
4.1%
83
2,017
7.2
Walmart
3.9%
34
4,117
12.6
Canadian Tire Corporation (ii)
3.7%
89
2,086
8.1
Cineplex/Galaxy Cinemas
3.3%
29
1,336
9.0
Metro/Super C/Loeb/Food Basics
2.9%
54
1,955
6.4
Winners/HomeSense/Marshalls/TJ Maxx
2.8%
73
1,675
6.9
Target (iii)
1.9%
26
2,188
11.8
Staples/Business Depot
1.8%
55
1,069
5.2
Giant Food Stores/Stop & Shop (Royal Ahold)
1.7%
24
1,113
11.1
Sobeys Inc./Safeway
1.6%
35
998
10.3
Loblaws/Shoppers Drug Mart includes No Frills, Fortinos, Zehrs and Maxi.
Canadian Tire Corporation includes Canadian Tire/PartSource/Mark’s/Sport Mart/ Sport Chek/Sports Experts/National Sports/Atmosphere.
On January 15, 2015, Target Corporation announced plans to discontinue its Canadian operations. See slide 22 for further discussion.
12
12
Lease Rollover Profile
Broadly Distributed Lease Expiries
% Square Feet expiring / portfolio NLA
Canadian Portfolio
As at March 31, 2015
4,448
’000s Square Feet
2,783
U.S. Portfolio
3,883
4,575
5,031
7.0%
11.2%
9.7%
11.5%
12.6%
2015
2016
2017
2018
2019
1,525
As at March 31, 2015
’000s Square Feet
717
621
499
6.2%
5.0%
7.1%
2015
2016
2017
1,059
10.6%
2018
15.2%
2019
13
Occupancy since 1996
Historical Committed Occupancy Rates 1996 to Q1 2015
97.7%
97.1%
96.9%
96.1%
95.0% 95.0%
95.4%
95.6% 95.8%
96.3% 96.3%
97.6%
96.9%
97.4% 97.4%97.6% 97.4%
96.9% 97.0% 96.7%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Q1
2015
14
Financial Highlights
Financial Highlights
Operating FFO*
Revenues
(at RioCan’s interest in millions of $ except per unit amounts)
10.3% CAGR
882
1,114
1,195 1,241
988
758
440
13.0% CAGR
280
492 517
380
329
2009 2010 2011 2012 2013 2014
Operating FFO* Per Unit
6.6%
CAGR
1.22
1.33
1.43
1.52
1.63
1.68
2009 2010 2011 2012 2013 2014
Years ended December 31st
2009 2010 2011 2012 2013 2014
* Note: FFO reported under IFRS for 2010 onwards,
excludes trading gain income
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
16
Quarterly Financial Highlights
Operating FFO
Revenues*
(in millions of $ except per
unit amounts)
334
300
307 309 304 306
306
106
115 116
124 121 124 124 127 127
134
130
138
317
292 290
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
269 271
2013
2012
2015
2014
Operating FFO Per Unit
0.40
0.41
0.39
0.40
0.41 0.41
0.42 0.42
0.43
0.44
0.42
0.37
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2012
* At RioCan’s interest
2013
2014
2015
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2012
2013
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
2014
2015
17
Financial Highlights
Distributions to Unitholders
(in millions)
297
367
318 343
401
426 432 447
Distributions to Unitholders per Unit
1.3275 1.36
281 285 293 316 313 310
261
228
Distributions to Unitholders net of DRIP
1.38
1.38
1.38
1.38
1.41
1.41
1.41
0.99
1.04
1.13
1.14
1.07
1.01
1.04
1.02
0.99
2007
2008
2009
2010
2011
2012
2013
2014
Q1
2015
Rolling
12
mos.
Distributions per Unit net of DRIP
18
Financial Highlights
$ per unit
Payout Ratio
% Change
Q1 2015
Q1 2014
Q1 2015
Q1 2014
0.0%
0.3525
0.3525
n/a
n/a
(2.4%)
0.40
0.41
88.1%
86.0%
OFFO
4.8%
0.44
0.42
80.1%
83.9%
AFFO
2.6%
0.39
0.38
90.4%
92.8%
Quarter
Distribution
FFO
Canada
Same Store NOI Growth
Same Property NOI
Growth
United States
Q1 2015
Q1 2014
Q1 2015
Q1 2014
(0.1%)
3.1%
1.9%
3.0%
0.1%
2.6%
1.6%
3.0%
19
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
Financial Highlights
•
RioCan's Operating Funds From Operations ("Operating FFO") increased 8.8% to $138
million for the three months ended March 31, 2015 compared to $127 million for the same
period in 2014;
•
On a per unit basis, Operating FFO increased by $0.02 or 4.8% to $0.44 compared
to $0.42 during the same period 2014;
•
During the First Quarter, RioCan announced a strategic joint venture with Hudson's Bay
Company ("HBC") focused on real estate growth opportunities in Canada. The joint
venture will enable RioCan and HBC to build on the strength of existing real estate assets
through potential future redevelopment, as well as identify retail and enclosed mall
acquisitions, and redevelopment opportunities;
•
RioCan's concentration of rental revenue in Canada's six major markets at March 31,
2015 increased to 73.6% from 72.2% at March 31, 2014; and
•
RioCan has raised $475 million through two debenture offerings in the first four months of
2015 at a weighted average effective interest rate of 2.8% and has redeemed two
previously outstanding series of debentures of US$100 million and $225 million that
carried an interest rate of 4.1% and 4.5% respectively. As a result of these and other
mortgage financing activities, RioCan has reduced its overall contractual interest rate on
outstanding debt to 3.96% at March 31, 2015 from 4.12% at December 31, 2014.
20
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
Financial Summary
Occupancy and Leasing Profile – Last eight quarters
2015
First
Quarter
2013
2014
Fourth
quarter
Third
quarter
Second
quarter
First
quarter
Fourth
quarter
Third
quarter
Second
quarter
Committed occupancy
96.7%
97.0%
97.0%
96.9%
96.8%
96.9%
97.0%
96.7%
Economic occupancy
95.5%
96.0%
96.0%
95.9%
95.7%
95.8%
95.5%
95.4%
NLA leased but not paying rent (thousands of
square feet)
623
512
488
520
519
542
716
642
Annualized rental impact (millions)
$17.6
$15.7
$15.5
$15.3
$13.0
$14.0
$17.0
$15.0
Retention rate – Canada
90.0%
85.0%
91.7%
88.8%
91.2%
97.0%
91.1%
95.9%
9.8%
11.8%
12.9%
13.9%
7.0%
8.8%
11.2%
12.0%
64.3%
78.3%
92.2%
97.3%
86.4%
98.2%
98.4%
92.0%
8.3%
7.1%
9.3%
7.0%
8.3%
4.8%
3.8%
4.3%
Average in place rent (psf)
$16.10 $16.15 $16.01
$16.00
$16.01
$16.08
$16.07
$15.77
Same store growth – Canada
(0.1%)
0.6%
1.9%
2.0%
3.1%
2.7%
2.2%
0.6%
1.9%
4.4%
3.7%
1.4%
3.0%
1.7%
0.9%
1.4%
% increase in average net rent per sq ft –Canada
Retention rate – US
% increase in average net rent per sq ft – US
Same store growth – US
21
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
Target’s Departure from Canada
•
On January 15, 2015, Target Corporation (Target) announced plans to
discontinue its Canadian operations through its indirect wholly-owned
subsidiary, Target Canada, and that it was utilizing the Companies’ Creditors
Arrangement Act (Canada) (“CCAA”) to wind down its operations.
•
As at March 31, 2015, RioCan has 26 locations under lease with Target Canada
representing approximately 1.9% of RioCan’s total annualized rental revenue
with an average remaining lease term of approximately 12.7 years. Target
liquidated its store inventory and closed all of its Canadian locations effective
April 12, 2015.
•
All but one of these leases are guaranteed through an indemnity arrangement
with Target, generally for the lesser of (i) the remaining term of each lease and
(ii) ten years. The one lease that is not covered by the Target indemnity is
guaranteed by Walmart Canada.
22
Target’s Departure from Canada
•
In April 2015, RioCan received notice from Target that they have disclaimed 18 of the 26 leases (representing 2.0 million sf, 1.6
million as at RioCan’s interest) in properties owned by RioCan as a result of Target's CCAA proceedings. These 18 stores have an
average lease rate of $6.78 per square foot, aggregating to $18.4 million of annualized rental revenue (at RioCan's interest).
Subsequent to receiving the disclaimer notices, RioCan has commenced negotiations with potential retailers to backfill the vacant
premises and mitigate damages to be pursued from Target under the terms of the indemnity agreement.
RioCan %
ownership
Site
Charlottetown Mall
City
Province
Charlottetown
PEI
50%
107,806
County Fair Mall
Smiths Falls
Ontario
100%
92,989
Desserte Ouest
Laval
Quebec
50%
Five Points Shopping Centre
Oshawa
Ontario
100%
Flamborough Power Centre
GLA (100%)
GLA Min. Rent
(RioCan %) PSF
$4.20
53,903
92,989
$3.58
116,147
58,074
$7.80
102,444
102,444
$7.46
100%
116,493
116,493
$8.25
Flamborough
Ontario
Gates Of Fergus
Fergus
Ontario
50%
95,978
47,989
$7.00
Lawrence Square
Toronto
Ontario
100%
89,432
89,432
$7.50
49,539
$6.75
57,783
$7.00
Mill Woods Town Centre
Edmonton
Alberta
40%
122,804
Millcroft Shopping Centre
Burlington
Ontario
50%
115,566
Orillia Square Mall
Orillia
Ontario
100%
91,440
91,440
$2.39
121,280
$8.11
RioCan Durham Centre
Ajax
Ontario
100%
121,280
RioCan Niagara Falls
Niagara Falls
Ontario
100%
106,103
106,103
$8.01
RioCan Scarborough Centre
Scarborough
Ontario
100%
116,241
116,241
$9.00
121,490
$4.18
Shopper's World Brampton
Brampton
Ontario
100%
121,490
South Hamilton Square
Hamilton
Ontario
100%
93,125
93,125
$7.51
Stratford Centre
Stratford
Ontario
100%
88,935
88,935
$3.01
50%
153,456
76,728
$9.77
100%
118,228
118,228
$7.50
1,969,957
1,602,216
$6.78
The Stockyards
Trinity Common Brampton
Total/W.A. (at RioCan’s Interest)
Toronto
Brampton
Ontario
Ontario
23
Target’s Departure from Canada
Through the CCAA process RioCan has been informed that the remaining eight Target
leases have been conditionally assigned to Canadian Tire and Lowe’s. Assignments
remain subject to certain approvals.
Site
City
Province
Min.
RioCan %
GLA Rent
ownership GLA (100%) (RioCan %) PSF
Target store locations assigned to Canadian Tire
1 Sudbury Place (Canadian Tire)
Sudbury
Ontario
100%
Calgary
Alberta
50%
Calgary
Alberta
100%
Victoria
British Columbia
50%
Abbotsford British Columbia
50%
Toronto
Ontario
50%
Ottawa
Ontario
50%
Burlington
Ontario
50%
109,554
109,554
$4.19
124,216
62,108
$7.00
116,288
116,288
$7.74
120,684
60,342
$6.50
115,407
57,704
$8.65
134,845
67,423
$7.16
103,568
51,784
$4.46
121,523
60,762
$4.17
946,085
585,964
$6.28
Target store locations assigned to Lowe’s
1 RioCan Shoppes At Shawnessy
2
3
4
5
6
7
Signal Hill Centre
Tillicum Centre
Abbotsford Power Centre
Shopper's World Danforth
RioCan St. Laurent
Burlington Mall
Total/W.A.
24
Conservative Debt Profile
•
•
•
•
•
Debt‐to‐Total Assets (net of cash) of 44.3% at March 31, 2015.
Total operating lines $726 million
Unencumbered pool has a fair value of $2.9 billion
Floating rate debt 10.4% of aggregate debt
Strong coverage ratios (based on rolling 12 months to March 31,
2015):
• EBITDA interest coverage of 2.93x
• Debt service coverage of 2.25x and
• Fixed charge coverage of 1.09x
* At RioCan’s interest
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
25
RioCan Capital Structure
Total Assets* – $15.1 Billion
100%
100%
75%
50%
25%
Total Enterprise Value* – $16.2 Billion
52.6%
1.8%
12.3%
33.3%
0%
Book Value*
75%
50%
56.9%
1.5%
11.2%
25%
30.4%
0%
Market Value
Common Units - 316 million units outstanding, $9.2 billion market capitalization
Preferred Units - $250 million market capitalization
Debentures - $1.8 billion
Mortgages & Lines of Credit - $4.9 billion
* At RioCan’s interest
26
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
Conservative Debt Structure
Growth in Asset vs Debt
Debt
Assets
15,129
5,338
3,260
CAGR – 18.1%
2008
6,729
CAGR – 11.8%
2009
2010
2011
2012
2013
Assets
2014
Debt
In millions, at RioCan’s Interest.
Q1 2015
27
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
Modest Leverage, Strong Interest Coverage
• RioCan has consistently adhered to a conservative debt policy even
through periods of considerable growth
•
•
60% max permitted under covenant
Interest coverage well in excess of the 1.65x maintenance covenant
Leverage
2.9x 2.9x
Interest Coverage
2.8x 2.9x 2.7x
2.7x
2.6x 2.6x
2.6x
2.2x
2.5x 2.5x
2.9x
2.7x 2.8x
3.1x
53.1% 53.8% 53.9% 56.6% 56.3% 54.9% 55.6% 49.1%
47.3% 48.2% 51.9%
46.4% 43.6% 44.0% 43.8% 44.3%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Q1 2015
* At RioCan’s interest
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
28
Debt Maturity Schedule
Mortgages payable
Floating Rate Mortgages and Lines of Credit
Debentures payable
Weighted average interest rate
3,000
2,569
2,500
2,000
3.88%
4.11%
1,500
1,000
4.30%
3.56%
1,194
651
802
3.56%
3.71%
6.0%
5.0%
4.0%
3.0%
893
2.0%
792
500
1.0%
0
0.0%
2015
2016
2017
2018
2019
Weighted Avg. Interest Rate on Maturing Debt
$ Millions
Scheduled principal amortization
Thereafter
Adjusted for issuance of $175 million Series Q re-opening
•
•
•
Long‐term, staggered debt maturity profile.
RioCan has successfully lowered overall borrowing costs and extended the weighted average term to maturity on
its debt since December 31, 2014. The weighted average interest rate at March 31, 2015 was 3.96% with a 4.18
year weighted avg. term to maturity at RioCan’s interest as compared to 4.12% and 3.95 years.
Low floating rate debt exposure (10.4% of total debt) at RioCan’s interest.
29
Leverage and Coverage Ratios & Targets
3 Months
Targeted
Ratios
Mar.
31/15
12 Months
Mar.
31/155
Mar.
31/15
Dec.
31/14
Interest coverage ratio1
>3.00x
3.10x
3.41x
2.93x
2.89x
Debt service coverage ratio2
>2.25x
2.36x
2.54x
2.25x
2.20x
Fixed charge coverage ratio3
>1.1x
1.12x
1.16x
1.09x
1.08x
Net operating debt to
operating EBITDA ratio4
<6.5x
7.70x
7.72x
7.67x
Unencumbered Assets
($millions)
$2,933
$2,777
Unsecured Debentures
($millions)
$1,825
$1,866
161%
149%
Unencumbered Assets to
Unsecured Debt
>200%
(1) Interest coverage defined as: Adjusted EBITDA for the period, divided by total interest expense (including interest that has been capitalized except where otherwise noted).
(2) Debt service coverage defined as: Adjusted EBITDA for the period, divided by total interest expense and scheduled mortgage principal amortization (including interest that has been capitalized).
(3) Fixed charge coverage is defined as: Adjusted EBITDA for the period, divided by total interest expense (including interest that has been capitalized) and distributions to common and preferred
unitholders.
(4) Net operating debt to Operating EBITDA is defined as: the average debt outstanding (net of cash) for the period less debt related to property under development divided by Operating EBITDA
(5)Adjusted to exclude interest capitalized to properties under development.
This slide contains references to non-GAAP Measures. For a definition of such measures please refer to RioCan’s March 31, 2015 MD&A.
* At RioCan’s interest
30
Future Growth Drivers
Acquisitions
Development
Pipeline
Organic
Growth
Future Growth
Drivers
Institutional
Relationships
Land Use
Intensification
31
Canadian Portfolio
Organic Growth
Ability to add growth through rental renewals with 52% of leases renewing over next five years.
•
•
In Q1 2015 achieved renewal rent increases of 9.8% or $1.70 psf with an average renewal rate of $19.12 psf.
Retention rate of 90% in Q1 2015
RioCan Lease Maturity Schedule and Renewal History
6,000
$20
$19
5,000
$18
4,000
$17
3,000
$16
$15
2,000
$14
1,000
0
$13
2008
2009
2010
2011
2012
2013
Square feet renewed/expiring (left axis)
2014
Q1 2015
2015
remaining
2016
2017
Achieved Renewal Rent PSF
2018
2019
$12
Expiring Rent PSF
Lease Expiries
(thousands except psf and % amounts
Total
Portfolio NLA
2015
2016
2017
2018
2019
39,844
2,782
4,448
3,883
4,576
5,032
7.0%
11.2%
9.7%
11.5%
12.6%
$17.59
$17.50
$18.75
$17.64
$17.50
Square Feet expiring/portfolio NLA
Total average net rent psf
$16.63
32
Organic Growth
U.S. Portfolio
Ability to add growth through rental renewals and leasing of vacant space.
•
•
•
44% of US Leases will expire over the next five years creating the potential for organic rental growth in the US portfolio
In Q1 2015, achieved renewal rent increases of 8.3% or $1.61 psf with an average renewal rental rate of $20.90 psf
Achieved same store rent growth of 1.9% in Q1 2015
Square Feet expiring/portfolio NLA
Leases Expiring
Total Portfolio
Cumulative
2016
2017
100%
80%
60%
40%
20%
0%
2014
2015
2018
Lease Expiries
(thousands except % amounts)
Total
Square Feet expiring/portfolio NLA
Portfolio NLA
2015
2016
2017
2018
2019
10,033
621
499
717
1,059
1,525
6.2%
5.0%
7.1%
10.6%
15.2%
33
Organic Growth
Occupancy
March 31, 2015
March 31, 2014
Canada
US
Total
Canada
US
Total
Majors (>10,000 sf)
99.1%
99.5%
99.2%
98.6%
99.7%
98.8%
Small Shop (<10,000 sf)
92.0%
88.3%
91.4%
93.5%
87.5%
92.5%
Blended
96.7%
96.6%
96.7%
96.9%
96.6%
96.8%
Leasing Activity
Canada
Quarter ended March 31,
(per square foot)
US
2015
2014
2015
2014
New Leasing
$18.81
$18.30
$21.83
$23.44
Renewal Leasing
$19.12
$15.47
$20.90
$22.53
9.8%
7.0%
8.3%
8.3%
% increase in average net rent psf
34
Joint Venture Agreement with
Hudson’s Bay Company
• On February 25, 2015, RioCan announced that it has agreed to form
a joint venture (“JV Entity”) focused on real estate growth
opportunities in Canada with Hudson’s Bay Company (“HBC”).
• The joint venture will enable RioCan and HBC to build on the
strength of existing real estate assets through potential future
redevelopment, as well as identify new real estate acquisition and
redevelopment opportunities.
• The transaction is structured to facilitate an IPO or other
monetization of the joint venture at a yet to be determined future
date.
35
35
Joint Venture Agreement with
Hudson’s Bay Company
RioCan’s Contributions to the JV Entity
RioCan has committed to contribute $325 million to the JV Entity for a
minority equity stake in a newly established joint venture entity (“JV Entity”).
RioCan’s Equity Contribution is comprised of three elements:
1. An equity contribution of $146 million in the form of a 50% interest in
the two mall properties
2. A $52 million capital contribution for tenant and capital improvements
to certain properties in the JV Entity
3. An equity contribution of $127 million to be funded over three years for
future acquisitions by the JV entity
36
36
Extracting Value by Recycling Capital
•
RioCan continues to evaluate its portfolio in order to selectively dispose of assets as a means of
recycling capital, and also to increase the portfolio weighting to the six major markets in Canada.
Since the start of 2013 to March 31, 2015, the Trust disposed of $789 million of properties in
Canada. As part of actively managing and improving the portfolio mix, RioCan will continue to
identify properties for disposition.
•
In January 2015, RioCan completed the sale of five income properties, located in Quebec, totalling
$120 million at a weighted average capitalization rate of 6.8%. The debt associated with these
properties was $21 million with a weighted average interest rate of 4.1%.
•
These asset sales will further enhance RioCan’s strategy to be focused in Canada’s high population,
high growth markets;
–
–
RioCan’s concentration in Canada’s six high growth markets is now 73.6% (Year end 2008 65.9%)
Capital from asset sales redeployed into acquisitions and development activities.
RioCan’s plan to recycle capital into higher growth assets will provide for
enhanced returns to unitholders and a reduced need for access to public
equity markets to raise capital.
37
Extracting Value by Recycling Capital
Growth in Canada’s 6 Major Markets
RioCan’s program of recycling capital is to shift the portfolio’s geographic allocation away
from low growth markets into Canada’s six high growth major markets.
Markets with highest population growth will outperform smaller markets with little growth or
negative population statistics.
73.6%
57.7%
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Q1
2015
38
Development Activity
Development Pipeline
Greenfield developments through in‐house capabilities and with partners, such as Allied
Properties, KingSett Capital, and Canada Pension Plan Investment Board (CPPIB)
At March 31, 2015
Total developments comprise 8.4 million square feet, including shadow anchors (2.9 million square feet included in Greenfield
developments and 4.1 million square feet of Urban intensification projects and 1.4 million square feet of Expansion and
Redevelopment).
•
RioCan’s aggregate net interest is 4.8 million square feet, comprising 1.8 million square feet of Greenfield development, 2.0
million square feet of Urban intensification projects and 1.0 million square feet of Expansion and Redevelopment.
•
Total estimated development spending of approximately $102 million in 2015 on Greenfield, Urban intensification, and
Expansion & Redevelopment activities. Overall development spending in the next three years will range from $150 million to
$250 million per year.
•
Estimated spending on RioCan’s active development pipeline totals approximately $1.5 billion.
•
Generate unlevered yield on an individual basis of between 5% to 8%, with a weighted average of 6% to 8%.
•
Recent Urban Development projects include The Well (Spadina and Front Street), Yonge & Eglinton Northeast corner, Bathurst &
College, and 740 Dupont in the Greater Toronto Area and the CPA Site in Calgary, Alberta.
Residential Development
•
RioCan has filed applications for rezoning on eight projects which, upon completion, should comprise a total of 5.7 million
square feet, of which 2.5 million square feet will be residential rental units held for long-term rental income, 1.0 million square
feet will be condominiums for sale and 2.2 million square feet will be incremental commercial gross leasable area. This would
permit RioCan to have an interest in approximately 2,992 residential units.
•
39
Development Activity
Development Pipeline
RioCan’s development portfolio is expected to add considerable value to the overall
investment property portfolio over the next six years. These assets are expected to generate
higher yields than what can currently be achieved in the acquisition market and create higher
quality assets than what are currently available for purchase.
•
•
Key component of RioCan’s organic
growth strategy
Focused on well located urban and
suburban developments in Canada’s six
major markets
1,200,000
1,000,000
Pipeline NLA* (000's Sq. Ft.)
RioCan’s development/redevelopment
program consists of 38 projects that are
expected to add 8.4 million square feet
(4.9 million square feet at RioCan’s
interest) over the next six years.
800,000
600,000
400,000
200,000
2015
2016
2017
Committed
2018
2019
2020
Non-committed
* Subject to preleasing and market conditions
40
Development Activity - Current
Portfolio
Development Portfolio by
Geographic Diversification
Property Type as a % of Development
Portfolio
47.9%
52.1%
Alberta, 14.9%
Suburban
GTA*
27.8%
Ontario, 85.1%
Toronto*
49.9%
Other Ontario*
7.4%
* % of total portfolio
New Format Retail
Urban Retail
41
Development Activity
Current Portfolio – Greenfield and Urban Intensification Projects
Calgary Developments
Greenfield Developments
• East Hills
• Sage Hill
Urban Intensification
• East Village (CPA Lands)
GTA Developments
Greenfield Developments
• RioCan Centre Vaughan
• Windfield Farms
Urban Intensification
• The Stockyards (completed)
• 1860 Bayview Ave
• Bathurst & College
• Yonge & Eglinton Northeast
Corner
• College and Manning
• Dupont Street
• The Well
• King & Portland
Ottawa Developments
Greenfield Developments
• Tanger Outlets – Kanata
(completed)
Greenfield Development
Flamborough Power Centre,
Hamilton, ON
42
Toronto Development Projects and Recent
Completions
Key Development Projects
Eglinton & Warden
(completed)
The Stockyards
(completed)
1860 Bayview Ave
Bathurst & College
Yonge & Eglinton
Northeast Corner
College and Manning
Dupont Street
The Well
King & Portland
Properties not mapped: Westney Road and Taunton, RioCan Centre Vaughan, Windfield Farms
43
Calgary Development Projects
Greenfield
Developments
East Hills
Sage Hill
Urban Intensification
Calgary East village (CPA
Lands)
44
Ottawa Development Projects and Recent Completions
Key Development Projects
Grant Crossing
(completed)
Herongate Mall
(completed)
Tanger Outlets – Kanata
(Phase I completed)
45
Land Use Intensification – Residential Potential
Transit Oriented Development
Toronto
•
•
•
RioCan’s Urban Platform holds a number of sites where the possibility for additional density through residential exist:
– Properties with the greatest potential for residential intensification are located on or near transit lines
Capitalize on trend in Canada’s six high growth markets towards “densifying” existing urban locations, driven by:
– Prohibitive costs of expanding infrastructure beyond urban boundaries
– Maximizing use of mass transit
– Generate higher yields as land is already owned
RioCan has a number of potential sites located in other major markets such as, Tillicum Centre in Victoria, BC and Brentwood Village Mall
in Calgary Alberta
46
Development Activities - Residential Intensification
Investment Rationale
•
•
•
•
Demand for professionally managed, quality
apartment units in Canada remains high.
Rental rates in key major markets, like Toronto,
have reached a level where the economics are
attractive for redeveloping certain centres in
urban, transit oriented locations. RioCan owns the
underlying land, often at irreplaceable locations,
thus giving it the unique opportunity to create a
tremendous amount of value.
Market
CMHC Reported Vacancy Rate October 2014
Toronto, Ontario
1.6%
Ottawa, Ontario
2.6%
Calgary, Alberta
1.4%
Edmonton,
Alberta
1.7%
Vancouver, BC
1.0%
The addition of a residential component will enhance the value of the underlying retail element of
RioCan’s property.
It is a sector that allows a steady and continuous income stream with a growth profile that will serve as a
hedge against inflation. The residential rental sector serves as a healthy diversification to RioCan’s retail
portfolio.
47
Land Use Intensification – Residential Potential
Transit Oriented Development
Favourable demographic trends
Population Growth Rates
Suburban GTA
Downtown Toronto
17%
Growth %
14%
4%
1991-2006
•
16%
2006-2011
1991-2006
2006-2011
Demand for rental residential spaces has strengthened as home prices have increased
dramatically. Average price of a detached home in Toronto now exceeds $1 million
Land Use Intensification – Residential Potential
Greater Toronto Area Case Study
12
N
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
2955 Bloor Street
740 Dupont Ave
College & Manning
491 College Street
Dufferin Plaza
King & Portland
Lawrence Square
Markington Square
Queensway Cineplex
RioCan Hall
RioCan Leaside
RioCan Marketplace
RioCan Scarborough
Yonge Sheppard Centre
Sunnybrook Plaza
The Well
Northeast Yonge & Eglinton
Properties where zoning applications have been filed.
Favourable barriers to entry:
– Land is already owned aiding overall project yields
– Intensification replaces old stock with dynamic retail. High demand space that attracts the
highest class of tenants and attracts the highest rents
49
Land Use Intensification – Residential Potential
Greater Toronto Area Case Study
Land Use Intensification – Residential Potential
•
•
•
RioCan’s Residential development plans include amenities that meet or exceed offerings in current
condominium developments providing a competitive advantage over that of existing residential stock.
Given the extent of this initiative, RioCan will possess a scale that will result in numerous efficiencies
going forward. Residential rental properties will typically attract favourable financing terms based on the
availability of CMHC insurance.
RioCan is committed to ensuring that the individual properties in its portfolio are utilized to their highest
and best use. RioCan has focused on mixed use projects containing predominantly multi-residential
rental buildings. RioCan has identified 47 properties that it deems to be strong intensification
opportunities all located in Canada’s six major markets.
Development Activities
Residential Intensification
RioCan has filed applications for rezoning eight projects which, upon completion, should comprise a total
of 5.7 million square feet, of which 2.5 million square feet will be residential rental units held for long-term
rental income, 1.0 million square feet will be condominiums for sale and 2.2 million square feet will be
incremental commercial gross leasable area. This would permit RioCan to have an interest in approximately
2,992 residential units.
Potential GLA (square feet at 100%)
Property
Yonge Eglinton Northeast Corner
Sunnybrook Plaza
College & Manning
740 Dupont Street
Sheppard Centre
King & Portland
The Well
Tillicum
TOTAL
Location
Toronto, ON
Toronto, ON
Toronto, ON
Toronto, ON
Toronto, ON
Toronto, ON
Toronto, ON
Victoria, BC
Application
Submission
Date
Jan-12
Dec-14
Sep-13
Jul-14
May-13
Aug-13
RioCan Ownership %
Residential
(Partner)
Commercial Rental (i)
Condominium
50% (Metropia/Bazis)
57,000
377,000
491,000
100%
25,000
375,000
—
50% (Allied)
6,000
49,000
—
100%
87,000
105,000
—
50% (Kingsett)
104,000
317,000
—
50% (Allied)
284,000
112,000
—
40% (Allied / Diamondcorp)
1,611,000
909,000
461,000
Feb-09
50% (Kimco)
16,000
276,000
—
2,190,000
2,520,000
952,000
Residential
Total
Rental Units
925,000
458
400,000
426
55,000
77
192,000
140
421,000
374
396,000
116
2,981,000
1,143
292,000
258
5,662,000
2,992
RioCan intends to file applications to rezone 19 additional properties by the end of 2015. These proposed
redevelopments are expected to produce approximately 8.2 million square feet, of which 7.5 million
square feet is expected to be residential. This would permit RioCan to have an interest in an additional
9,248 residential units. As these projects are in preliminary stages, there can be no assurance that any of
these developments will be undertaken and if so, on what terms.
52
Creating New Cash Flow Sources
Residential Intensification
Yonge & Eglinton Northeast Corner - Toronto, Ontario
Location:
Toronto, Ontario
Intersection:
Yonge & Eglinton
Total Proposed Retail GLA:
54,000 square feet*
Proposed Rental Residential Units:
458 Units
Design Concept:
Urban Retail
Anticipated Completion:
2018
RioCan Interest
50%
• Located across the street from RioCan’s head office
• 1.1 acre site has been approved for redevelopment by
the city of Toronto with a 58 storey tower at corner of
Yonge and Eglinton and a 36 storey tower fronting
Roehampton Avenue (first street north of Eglinton).
• Condominium portion of the project is 100% pre-sold.
• North tower to be developed as rental residential.
Current plans are for a 458 unit residential apartment
building.
• Construction commenced in Q2 2014.
* RioCan will purchase 100% of the retail space at a 7% capitalization rate upon completion of the project.
53
Creating New Cash Flow Sources
Residential Intensification
RioCan has a number of Urban Intensification opportunities in the GTA market
Sunnybrook Plaza, Toronto, ON
•
•
•
Proposed
Located at the busy intersection of Bayview Avenue
and Eglinton Avenue in midtown Toronto.
The site benefits from excellent demographics and is
a probable location for a stop along the proposed
Eglinton subway line.
RioCan has filed for rezoning to permit a 400,000 sf
mixed use, retail/residential redevelopment project
including 25,000 sf of retail and 375,000 sf of
residential including 426 units.
Today
54
Creating New Cash Flow Sources
The Sheppard Centre, Toronto
Location:
Toronto, Ontario
Intersection:
Yonge & Sheppard
Total Commercial GLA:
421,000 square feet
Proposed Rental Residential Units :
400
Design Concept:
Urban Retail
Expected Construction Start:
2015
Anticipated Completion:
2017
RioCan Interest
50%
• Plans include substantial renovation of retail space including a new
four storey retail addition fronting Sheppard Avenue and substantial
upgrade to the interior retail space.
• When complete will add approximately 104,000 square feet of new
retail space.
• Plans also contemplate the addition of a new 39 storey residential
tower containing 317,000 square feet including approximately 400
rental units.
• Fast growing area of North Toronto
• Anchored by Shoppers Drug Mart and Winners
• Agreements in place with Longo’s and LA Fitness
Potential Design
55
Creating New Cash Flow Sources
Residential Intensification
740 Dupont - Toronto, Ontario
Location:
Toronto, Ontario
Intersection:
740 Dupont Street
Total Proposed GLA:
192,000 square feet
Proposed Rental Residential Units :
225
Design Concept:
Urban Retail/Residential
Anticipated Completion:
2020
RioCan Interest
100%
56
Development Pipeline
RioCan, Allied Properties REIT, & Diamond Corporation Joint Venture
•
RioCan, Allied Properties and Diamond Corp announced in
November 2012 that they had entered into a joint venture
arrangement to acquire the Globe and Mail site in
downtown Toronto. In April 2013, the partners also
purchased an adjacent parcel. The combined parcels are
approximately 7.7 acres.
•
Project is expected to be approximately 3 million square
feet of mixed use space including approximately 1.6
million sf of retail and office space and 1.4 million sf of
residential space (0.9 million sf rental and 0.5 million sf as
condominium space) that will be built out in phases.
•
The joint venture is structured on a 40/40/20 basis
between RioCan, Allied and Diamond. RioCan and Allied
will act as joint development and construction managers.
Upon completion of any projects RioCan will act as
property manager for any retail portion of the property
and Allied will act as property manager for any office
portion.
57
Development Pipeline
RioCan, Allied Properties REIT, & Diamond Corporation Joint Venture
THE WELL – Potential Layout and Vision
Current vision for the site includes a mixed use of office, retail and
residential uses with inspiration drawn from other open air mixed retail
properties in Europe.
58
Development Pipeline
RioCan, Allied Properties REIT, & Diamond Corporation Joint Venture
THE WELL – Potential Layout and Vision
59
Development Pipeline
RioCan & Allied Properties REIT Joint Venture
King & Portland
•
RioCan and Allied Properties announced in July 2012 that
they had entered into a joint venture arrangement on a non
exclusive basis to acquire sites in the urban areas of major
Canadian cities that are suitable for mixed use
intensification.
•
The joint venture is structured on a 50/50 basis between
RioCan and Allied. Upon completion of any projects RioCan
will act as property manager for any retail portion of the
property and Allied will act as property manager for any
office portion.
•
First two sites to be developed are:
–
King and Portland which will be developed into a mixed use
complex with approx. 396,000 square feet including 116
residential units in Toronto, Ontario. In Q4, 2014 RioCan
purchased an additional parcel at 499 Adelaide St. West
which will form part of the assembly.
–
College and Manning will be developed into a mixed use
complex with approx. 55,000 square feet. The site, which
received zoning approval in the third quarter of 2014, will
include 6,000 square feet of retail and 77 residential units
in an eight-storey mixed-use building.
College and Manning
60
Development Pipeline
Calgary East Village
•
2.8 acre site located in the East Village area of
downtown Calgary, Alberta. One of Calgary’s few
remaining privately owned blocks.
•
The site was acquired on a 50/50 joint venture basis
with KingSett Capital.
•
The intention is for two residential towers to be
erected upon the retail podium that will be anchored
by a 102,000 square foot Loblaws.
•
RioCan and KingSett, have entered into an agreement
with developer, Embassy BOSA Inc., to sell up to $30
million in air rights (representing 600,000 square feet)
above the site, along with approximately $40 million in
cost reimbursement for infrastructure works.
•
Development is anticipated to commence in 2016.
•
RioCan is responsible for the development,
management and leasing of the property.
Potential Design
Current Site
61
Development Pipeline
Sage Hill, Calgary
Greenfield Development
• Sage Hill Crossing, a 32 acre greenfield
development site in Northwest Calgary.
• RioCan owns the development on a 50/50 basis
with KingSett Capital.
• Development commenced in 2013.
• Once completed, the anticipated gross leasable
area is 394,000 square feet of retail use.
• The property is 75% preleased with Walmart
and Loblaws slated to be the anchor tenants.
Walmart commenced operations in January
2015.
• Other major tenants include, RBC, Scotiabank,
McDonalds, Liquor Depot and London Drugs.
• Loblaws is slated to open in Q4 2015 with the
remainder of the tenants opening over the
course of 2016.
• RioCan is responsible for the development,
management and leasing of the property.
62
“Densifying” existing urban locations
Yonge Eglinton Centre - Toronto, Ontario
•
RioCan acquired the property in 2007 and
launched revitalization and expansion plan to
capitalize on area’s residential intensification
significant increases in NOI and occupancy
63
Creating New Cash Flow Sources
RioCan Yonge Eglinton Centre –The Cube
Proposed
Today
Location:
Intersection:
Total Proposed GLA:
Design Concept:
Construction Start:
Expected Completion:
RioCan Interest:
Toronto, Ontario
Yonge & Eglinton
45,000 square feet
Urban Retail
Q2 2013
2015
100%
RioCan has leased the media screens to CBS Outdoor
Canada, which will generate additional revenue at the site.
64
Urban Intensification
420 Bathurst Street, Toronto
Location:
Toronto, Ontario
Intersection:
Bathurst & College
Total Proposed GLA:
145,000 square feet
Design Concept:
Urban Retail/Office
Anticipated Completion:
2017
65
Development Pipeline
Recent Completions
The Stockyards - St. Clair & Weston, Toronto
551,000 sqf. two storey retail – Opened Spring 2014
•
•
•
This unique site at the corner of St. Clair and Weston Road in Toronto, Ontario;
On March 31, 2014, RioCan acquired its partner Trinity’s 25% interest in the site, as a result RioCan
owns 50% of this landmark property. RioCan manages and leases the property on behalf of the joint
venture;
The property opened in the Spring of 2014, and during the third quarter 2014 an additional fourteen
tenants (including Sport Chek, Roots, Banana Republic and RBC Royal Bank) totalling approximately
57,000 square feet commenced operations.
Partner: Canada Pension Plan Investment Board (“CPPIB”)
66
Urban Intensification – Completed
Projects
Queen & Portland, Toronto, ON
Location:
Toronto, Ontario
Intersection:
Portland & Queen
Total GLA:
91,000 square feet
Design Concept:
Construction Completed:
Mixed‐use facility
2011
After
Before
67
Urban Intensification – Completed
Projects
1717 Avenue Road, Toronto, ON
Location:
Toronto, Ontario
Intersection:
1717 Avenue Road
Total GLA:
91,000 square feet
Design Concept:
Construction Completed:
Mixed‐use facility
2011
68
Canadian Outlet Centre Development
•
•
•
In 2011, RioCan entered into an exclusive joint venture for the acquisition, development
and leasing of sites across Canada that are suitable for development or redevelopment as
outlet shopping centres similar in concept and design to those within the existing Tanger
U.S. portfolio.
In November 2012, RioCan and Tanger acquired two sites in the Montreal area, Les
Factoreries Saint-Sauveur, and Le Carrefour Champetre (Bromont Outlet Centre). The
Montreal sites are existing centres which will be expanded and re-branded as Tanger
Outlet Centers.
In the fourth quarter of 2014 the joint venture opened/expanded two Tanger Factory
Outlet Centers. The first in Kanata, Ontario in the Ottawa market, which was the first
ground up development by RioCan and Tanger. The other completed centre was the
Tanger Factory Outlet Center in Cookstown, Ontario in the Greater Toronto market at the
newly expanded Cookstown Mall location that was acquired by the joint venture in 2011.
69
Outlet Centre Development
Tanger Outlets - Kanata
•
•
•
•
52.5 acre site, approximately 20 kilometres west of Ottawa
Construction was completed on the initial phase comprising 299,000 square foot in Q4 2014.
The grand opening on October 17, 2014 was very well received with tenants reporting sales above expectations.
A second 51,000 square foot phase will commence construction in 2015 which will include a 28,000 sf Saks Off Fifth
location.
70
Outlet Centre Development
Cookstown Outlet Mall
Completed Projects
Purchased in December 2011 with Tanger
Factory Outlet Centers.
•
•
•
Before
161,000 square foot outlet centre with the construction in progress to add a further 158,000 square feet of retail space.
Construction on the expansion began in Q2 2013 and was completed in Q4 2014.
Site includes 80 designer stores including:
After
71
Appendix
Development Tables
Greenfield Development Portfolio
Greenfield Development
Properties
(thousands of square feet)
RioCan’s
East Hills, Calgary, AB *
Flamborough Power Centre, Hamilton,
ON *
Sage Hill, Calgary, AB *
Greenfield Developments –Committed
RioCan Centre Vaughan, Vaughan, ON
Phase 3 *
Windfield Farms, Oshawa, ON *
Greenfield Developments –
Non-committed
Total Greenfield Developments
Interest Partners
Anchors
CPP /
40% Lansdowne / Walmart, Cineplex
Tristar
Estimated square feet upon completion of
the development project
Retailer
Total
owned
Total
estimated
anchors RioCan’s Partners’ leasing
%
Development (i)
interest interests
activity(ii) Leased
Anticipated date of
development
completion
Current
development
Potential
future
developments
886
160
290
436
329
45%
Q2 2016
2018
100% —
—
283
—
283
—
195
69%
Q2 2016
2017
50%
Walmart, Loblaws,
London Drugs
394
—
197
197
297
75%
Q2 2016
2016
1,563
160
770
633
821
59%
96
74
7
15
—
—%
2016
1,218
157
1,061
—
—
—%
2017 (iii)
1,314
231
1,068
15
—
—%
2,877
391
1,838
648
821
33%
Kingsett
Trinity /
31%
Strathallan
100% —
(i) Retailer owned anchors include both completed and contemplated sales.
(ii)Leasing activity includes leasing that is conditional on receiving municipal approvals and meeting construction deadlines.
(iii) The first phases are expected to be substantially complete by the dates indicated.
* Property represents one of RioCan’s 15 properties under development.
73
Greenfield Development Portfolio
Development Expenditures
Greenfield Development Expenditures
(thousands of dollars)
East Hills, Calgary, AB
Flamborough Power Centre, Hamilton, ON
Sage Hill, Calgary, AB
Fair value adjustments
Greenfield Developments – Committed
RioCan Centre Vaughan, Vaughan, ON Ph 3 (ii)
Windfield Farms, Oshawa, ON
Fair value adjustments
Greenfield Developments - Non-committed
Total Greenfield Developments
RioCan’s Estimated
%
project cost
ownership (100%) (i)
40%
$308,314
100%
61,753
50%
112,322
31.25%
100%
482,389
10,395
223,476
233,871
$716,260
Estimated remaining construction
Acquisition and development expenditures incurred to date
RioCan’s interest
Amount
Amount
included in included in
Partners’
IPP
PUD
Total
interest
Total
$483
$73,559
$74,042
$94,321 $168,363
31,405
7,560
38,965
—
38,965
5,695
18,325
24,020
21,909
45,929
—
6,834
6,834
—
6,834
37,583
106,278
143,861
116,230 260,091
—
7,785
7,785
11,154
18,939
—
53,211
53,211
—
53,211
—
4,326
4,326
—
4,326
—
65,322
65,322
11,154
76,476
$37,583
$171,600
$209,183
$127,384 $336,567
expenditures to complete
RioCan’s
interest
$55,980
22,788
33,197
—
111,965
(2,670)
170,265
—
167,595
$279,560
Partners’
interest
$83,970
—
33,197
—
117,167
(5,874)
—
—
(5,874)
$111,293
Total
$139,950
22,788
66,394
—
229,132
(8,544)
170,265
—
161,721
$390,853
(i) Proceeds from sale to shadow anchors reduce projected cost.
(ii) Credits reflect proceeds from a potential land parcel sale.
74
Greenfield Development Portfolio
Development Expenditures
Greenfield Development
Projects
(thousands of dollars)
East Hills, Calgary, AB
Flamborough Power Centre, Hamilton, ON
Sage Hill, Calgary, AB
Greenfield Developments –Committed
RioCan Centre Vaughan, Vaughan, ON Ph 3 (i)
Windfield Farms, Oshawa, ON
Greenfield Developments –Non-committed
Total Greenfield Developments
Estimated remaining development activity to be funded by RioCan
2015
2016
2017 & Thereafter
Future Development
Total
RioCan’s RioCan’s Mezzanine RioCan’s Mezzanine RioCan’s Mezzanine RioCan’s Mezzanine RioCan’s Mezzanine
interest interest
financing interest
financing interest
financing interest
financing interest
financing
40%
$2,698
$— $21,603
$—
$7,666
$— $24,013
$— $55,980
$—
100%
1,860
—
—
—
—
—
20,928
—
22,788
—
50%
16,078
—
9,302
—
—
—
7,816
—
33,196
—
20,636
—
30,905
—
7,666
—
52,757
— 111,964
—
31.25%
157
94
216
130
—
—
(3,043)
(1,826)
(2,670)
(1,602)
100%
1,716
—
2,362
—
2,463
— 163,723
— 170,264
—
1,873
94
2,578
130
2,463
— 160,680
(1,826) 167,594
(1,602)
$22,509
$94 $33,483
$130 $10,129
$— $213,437 ($1,826) $279,558 ($1,602)
(i) Credits reflects proceeds from a potential land parcel sale.
75
Urban Intensification Properties
Urban Intensification Properties
(thousands of square feet)
RioCan’s
Interest
1860 Bayview Avenue, Toronto, ON *
100%
Bathurst Street & College Street, Toronto, ON *
100%
Partners
Whole Foods
—
CPA Lands, Calgary, AB *
50% KingSett
NE Yonge Eglinton, Toronto, ON (iv) *
50%
Metropia /
Bazis
Urban Intensification-Committed
College & Manning, Toronto, ON *
Dupont Street, Toronto, ON *
50% Allied
100%
Allied /
Diamond
The Well, Toronto, ON (iv)*
40%
King & Portland, Toronto, ON *
50% Allied
Urban Intensification - Non-committed
Total Urban Intensification
Anchors
Loblaws
Estimated square feet upon completion of the
Anticipated date of
development project
development completion
Total
Retailer
Total
estimated
owned
RioCan’s Partners’ leasing
%
Current
Potential future
Development anchors (i) interest interest activity (ii) Leased development
developments
76
—
76
—
70
92%
Q2 2016
2016
145
—
145
—
52
36%
2017
170
—
85
85
102
60%
2018
434
—
217
217
18
4%
2018
825
—
523
302
242
29%
114
—
57
57
59
52%
2018
192
—
192
—
—
—%
2020
2,520
—
1,008
1,512
—
—%
2019 (iii)
444
—
222
222
48
11%
2017
3,270
—
1,479
1,791
107
3%
4,095
—
2,002
2,093
349
9%
(i) Retailer owned anchors include both completed and contemplated sales.
(ii) Leasing activity includes leasing that is conditional on receiving municipal approvals and meeting construction deadlines.
(iii) The first phases are expected to be substantially complete by the dates indicated.
(iv) Includes amounts for offices, retail and rental residential (excludes condominium component).
* Property represents one of RioCan’s 15 properties under development.
76
Urban Intensification Properties
Development Expenditures
Urban Intensification Expenditures
(thousands of dollars)
1860 Bayview Avenue, Toronto, ON
Bathurst Street & College Street, Toronto, ON
CPA Lands, Calgary, AB
NE Yonge Eglinton, Toronto, ON
Fair value adjustments
Urban Intensification – Committed
College & Manning, Toronto, ON
Dupont Street, Toronto, ON
The Well, Toronto, ON
King & Portland, Toronto, ON
Fair value adjustments
Urban Intensification - Non-committed
Total Urban Intensification
Estimated
RioCan’s % project cost
ownership (100%) (i)
100%
$56,831
100%
91,591
50%
127,441
50%
233,637
50%
100%
40%
50%
509,500
52,036
98,637
1,566,331
221,253
1,938,257
$2,447,757
Acquisition and development expenditures incurred to date
RioCan’s interest
Amount
Amount
included in included in
Partners’
IPP
PUD
Total
interest
Total
$—
$28,355
$28,355
$— $28,355
—
26,481
26,481
—
26,481
—
11,624
11,624
10,626
22,250
126
33,432
33,558
32,419
65,977
8,487
8,487
8,487
126
108,379
108,505
43,045 151,550
8,545
4,710
13,255
12,027
25,282
—
15,187
15,187
—
15,187
691
77,809
78,500
110,446 188,946
10,460
14,638
25,098
22,961
48,059
—
18,266
18,266
—
18,266
19,696
130,610
150,306
145,434 295,740
$19,822 $238,989 $258,811 $188,479 $447,290
Estimated remaining construction
expenditures to complete
RioCan’s
interest
$28,476
65,110
52,596
83,830
Partners’
interest
$—
—
52,596
83,830
Total
$28,476
65,110
105,192
167,660
230,012
13,377
83,450
550,954
86,597
—
734,378
$964,390
136,426
13,377
—
826,431
86,597
—
926,405
$1,062,831
366,438
26,754
83,450
1,377,385
173,194
—
1,660,783
$2,027,221
(i) Proceeds from sale to shadow anchors reduce projected cost, and exclude potential condominium residential units.
77
Urban Intensification Properties
Development Expenditures
Urban Intensification Projects
(thousands of dollars)
1860 Bayview Avenue, Toronto, ON
Bathurst Street & College Street, Toronto, ON
CPA Lands, Calgary, AB
NE Yonge Eglinton, Toronto, ON (i)
Urban Intensification – Committed
College & Manning, Toronto, ON
Dupont Street, Toronto, ON
The Well, Toronto, ON
King & Portland, Toronto, ON
Urban Intensification – Non-committed
Total Urban Intensification
Estimated remaining development activity to be funded by RioCan
2015
2016
2017 & Thereafter
Future Development
Total
RioCan’s RioCan’s Mezzanine RioCan’s Mezzanine RioCan’s Mezzanine RioCan’s Mezzanine RioCan’s Mezzanine
interest interest
financing interest
financing interest
financing interest
financing interest
financing
100%
$—
$— $28,476
$—
$—
$—
$—
$— $28,476
$—
100%
1,431
—
29,114
—
27,065
—
7,500
—
65,110
—
50%
1,800
—
577
—
602
—
49,616
—
52,595
—
50%
6,451
—
14,821
—
62,558
—
—
—
83,830
—
9,682
—
72,988
—
90,225
—
57,116
— 230,011
—
50%
217
—
212
—
442
—
12,505
—
13,376
—
100%
490
—
674
—
1,406
—
80,880
—
83,450
—
40%
2,666
—
3,460
—
10,828
— 534,000
— 550,954
—
50%
778
—
663
—
1,383
—
83,773
—
86,597
—
4,151
—
5,009
—
14,059
— 711,158
— 734,377
—
$13,833
$— $77,997
$— $104,284
$— $768,274
$— $964,388
$—
(i) Cost to complete to be financed by construction line.
78
Expansion & Redevelopment Portfolio
Development Expenditures
Expansion & Redevelopment
(thousands of square feet, thousands of dollars)
As at March 31, 2015
491 College Street, Toronto, ON
Development
RioCan’s
interest
Tenant(s)
50%
Corbett Centre, Fredericton, NB
Eglinton Avenue & Warden Avenue, Toronto, ON
Herongate Mall, Ottawa, ON
Sleep Country
100% Canada
Dentist, Mucho
100% Burrito, Popeyes
Mill Woods Town Centre, Edmonton, AB
75% Fit For Less
Kitchen Stuff Plus,
50% McDonald's
Lenscrafters,
40% Cellicon
RioCan Centre Victoria, Whitby, ON
50%
Kennedy Commons, Toronto, ON
Bed Bath &
Beyond, Buy Buy
100% Baby, Staples
RioCan Colossus Centre, Vaughan, ON
RioCan Hall, Toronto, ON
100% Michaels
Shoppers Drug
63% Mart, Beer Store
Shoppers City East, Ottawa, ON*
Project
NLA
Estimated project cost
RioCan’s
Partners’
interest
interest
Total
Historical
costs(i)
expenditures
to date at
RioCan’s
interest
Sub-total
Costs
Incurred
to date
Estimated remaining
development activity
at RioCan’s interest
2015
2016
2017+
30
$5,544
$5,544
$11,088
$3,964
$343
$4,307
$137
$2,798
$2,266
32
7,600
—
7,600
—
3,807
3,807
514
3,279
—
15
4,023
—
4,023
4,444
957
5,401
2,402
664
—
43
5,989
1,996
7,985
4,759
2,112
6,871
3,878
—
—
15
1,293
1,293
2,586
800
795
1,595
498
—
—
10
373
552
925
1,148
244
1,392
129
—
—
174
16,270
16,270
32,540
9,004
1,519
10,523
3,088
11,663
—
115
30,236
—
30,236
17,381
5,467
22,848
11,563
8,726
4,479
32
2,843
—
2,843
14,600
1,359
15,959
1,484
—
—
47
7,155
4,238
11,393
18,487
2,713
21,200
—
4,442
—
Tanger Outlets - Kanata, Kanata, ON
50%
79
13,786
13,786
27,572
5,754
2,597
8,351
3,985
7,203
—
The Stockyards, Toronto, ON
50%
20
1,652
1,652
3,304
6,700
168
6,868
—
1,484
—
23
897
—
897
2,900
361
3,261
536
—
—
45
87,479
—
87,479
8,600
72,066
80,666
15,413
—
—
104
79,123
79,123
158,246
21,900
8,008
29,908
21,242
37,244
12,630
PetSmart, Fit for
100% Less
Winners, Cineplex
100% Expansion
Longos, LA
Fitness, Mall
50% Renovation
West Ridge Place, Orillia, ON
Yonge & Eglinton Centre, Toronto, ON
Yonge Sheppard Centre, Toronto, ON (ii)
Fair Value Adjustments
Total Committed Expansion and Redevelopment properties
—
—
—
—
4,850
—
4,850
—
—
—
784
264,263
124,454
388,717
125,291
102,516
227,807
64,869
77,503
19,375
(i)
(ii)
Historical Costs - Carrying amounts transferred from IPP for former anchors targeted for redevelopment.
Yonge Sheppard Centre's interior mall retrofit is excluded from NLA, however, it is included in estimated project costs. Condo related NLA
and costs are excluded from the table
* Property represents one of RioCan’s 15 properties under development.
79
Expansion & Redevelopment Portfolio
Development Expenditures
Expansion & Redevelopment
Total
Historical
costs(i)
Development
expenditures
to date at
RioCan’s
interest
Continued
(thousands of square feet, thousands of dollars)
As at March 31, 2015
RioCan’s
interest
Tenant(s)
Project
NLA
Estimated project cost
RioCan’s
Partners’
interest
interest
Sub-total
Costs
Incurred
to date
Estimated remaining
development activity
at RioCan’s interest
2015
2016
2017+
Brookside Mall, Fredericton, NB
50%
TBD
70
2,097
2,097
4,194
261
1,081
1,342
—
1,017
—
Les Factoreries Tanger - Bromont, Bromont, Quebec
50%
TBD
70
8,936
8,936
17,872
1,340
144
1,484
—
8,792
—
Les Factoreries Tanger - Saint-Sauveur, Saint Sauveur, Quebec
50%
TBD
19
3,062
3,062
6,124
279
377
—
2,964
—
Mega Centre Notre-Dame, Dorothee, Quebec
100%
TBD
181
39,017
—
39,017
12,450
1,492
13,942
—
37,525
—
RioCan Centre Barrie, Barrie, Ontario
100%
TBD
26
8,421
—
8,421
1,486
872
2,358
—
7,549
—
RioCan Centre Burloak, Oakville, Ontario
50%
TBD
141
7,986
7,986
15,972
4,959
1,140
6,099
71
2,703
4,071
Timiskaming Square, New Liskeard, ON
100%
TBD
79
3,536
—
3,536
1,445
671
2,116
—
2,865
—
Westney Road & Taunton Road, Ajax, ON
100%
TBD
62
13,687
—
13,687
10,605
720
11,325
344
6,783
5,840
—
—
—
—
(7,064)
—
(7,064)
—
—
—
648
86,742
22,081
108,823
25,761
6,218
31,979
415
70,198
9,911
$65,284 $147,701
$29,286
Fair Value Adjustments
Total Non-committed Expansion and Redevelopment properties
1,432 $ 351,005 $146,535 $497,540 $151,052
Total
(i)
98
$108,734 $259,786
Historical Costs - Carrying amounts transferred from IPP for former anchors targeted for redevelopment.
80