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RioCan Announces Fourth Quarter and Year End Results for 2020

Posted

02/11/2021

TORONTO, Feb. 11, 2021 (GLOBE NEWSWIRE) -- RioCan Real Estate Investment Trust (“RioCan" or the "Trust”) announced today its financial results for the three months ("Fourth Quarter") and year ended December 31, 2020.

“I cap off my 108th and last quarter as CEO of RioCan as we continue to grapple with the COVID-19 pandemic. Considering the unparalleled impact of the pandemic on our business, including rent collection, tenant restructuring, and a less active transaction market, RioCan came through very well, ending the year with record liquidity and achieving our FFO per Unit guidance,” said Edward Sonshine, CEO of RioCan. “We made the difficult, yet prudent and correct decision to reduce our distribution to optimize capital allocation towards value creation opportunities such as development, debt repayment and unit buybacks. Our development program is poised to deliver new and diversified sources of income and cash flow from development completions with more to come given our large and robust pipeline. All of these actions will allow us to raise our distribution when the economy recovers as the pandemic dissipates. While we continue to face the second wave of the pandemic and an uneven road to economic recovery, RioCan's best-in-class team under the leadership of Jonathan Gitlin, my successor, are well-positioned to unlock the embedded value in our great portfolio. In my new role as the Board Chairman, I look forward to watching RioCan enter its next phase of growth as life returns to a normal state, hopefully by the end of 2021." 

           
    Three months ended December 31     Year ended December 31
(in millions except percentages, square feet and per unit values)       2020        2019         2020        2019
                       
Financial Highlights                      
Net income (loss)   $ 65.6     $ 150.8     $ (64.8)       $ 775.8
Weighted average Units outstanding - diluted (in thousands)   317,739     315,080     317,725       307,779
FFO (i)   $ 124.1     $ 146.1     $ 507.4       $ 575.8
FFO per unit – diluted (i)   $ 0.39     $ 0.46     $ 1.60       $ 1.87
                       
                       
Operation Highlights                      
Same property NOI (decline) growth - overall portfolio (i)       (7.9)%       2.3%         (6.5)%         2.1%
Six major markets - % of total annualized revenue (ii)       90.0  %       90.1%         90.0  %         90.1%
Greater Toronto Area - % of total annualized revenue (ii)       51.3  %       52.4%         51.3  %         52.4%
Occupancy - committed six major markets (ii)       96.1  %       97.7%         96.1  %         97.7%
Occupancy - committed (ii)       95.7  %       97.2%         95.7  %         97.2%
Blended leasing spread       3.8  %       8.2%         5.0  %         9.4%
New leasing spread       5.1  %       2.1%         7.9  %         10.0%
Renewal leasing spread       3.6  %       10.2%         4.4  %         9.2%
                       
                       
Development Highlights                      
Development completions - sq ft in thousands   320.0     118.0     529.0       530.0
Development expenditures (iii)   $ 141.4     $ 143.5     $ 493.4       $ 473.7
Properties under development and residential inventory as a percentage of consolidated gross book value of assets (maximum permitted: 15%) (ii) (iii)       10.3  %       9.0%         10.3  %         9.0%
                       
                       
Balance Sheet Strength Highlights                      
Debt to Adjusted EBITDA (i) (iv)   9.47x     8.06x           9.47x           8.06x
Ratio of total debt to total assets (i) (ii) (iv)       45.0  %       42.1%         45.0  %         42.1%
Unencumbered assets (i) (ii) (iv)   $ 8,727     $ 8,937     $ 8,727       $ 8,937
Unencumbered assets to unsecured debt (i) (ii) (iv)       215  %       227%         215  %         227%
                       

(i) A Non-GAAP measurement. For definitions and the basis of presentation of RioCan's Non-GAAP measures, refer to the Non-GAAP Measures section in RioCan's Management's Discussion and Analysis (MD&A) for the year ended December 31, 2020.
(ii) Information presented as at December 31 for the years then ended.
(iii) Includes costs incurred for various properties under development and for residential inventory in respective reporting periods.
(iv) At RioCan's proportionate share.
   

COVID-19 Pandemic and Its Impacts on RioCan Property Operations

  • With rising COVID-19 cases, the arrival of the second wave of the pandemic in the Fourth Quarter has resulted in governments reinstating and tightening various restrictive measures, including the closure of non-essential businesses in certain provinces. As of December 31, 2020, 25% of the Trust's tenants were closed, compared with virtually all tenants open as of September 30, 2020. Although rollout of the vaccine has instilled some optimism in the market, challenges regarding the vaccine distribution persist and the duration of the pandemic remains uncertain. More extensive store closures and restrictive measures have been further introduced in Ontario and Quebec post the year end.
  • Despite the challenges presented by the evolving pandemic, as of February 10, 2021, the Trust collected 94.2% of its Fourth Quarter billed gross rents in cash, slightly higher than its cash collection ratio when it reported the Q3 2020 results in late October 2020 even though more stores were mandated to close in the Fourth Quarter. The Canadian Emergency Commercial Rent Assistance (CECRA) program was replaced by the Canada Emergency Rent Subsidy (CERS) program in the Fourth Quarter. The CERS funding is provided directly to tenants without a landlord rent abatement requirement and will be in effect until June 2021. As a result, there was no CECRA government funding or CECRA-related rent abatement provision in the Fourth Quarter.
  • The Trust's collections of billed gross rents as of February 10, 2021 are summarized as follows:
         
  Q4 2020 Q3 2020 Q2 2020 Total 2020 (i)
Total cash collected (ii) 94.2 % 94.5 % 87.2 % 91.8 %
Deferred rents with definitive payment schedule 0.8 % 0.2 % 4.7 % 2.0 %
Provision for rent abatements and bad debts 3.4 % 5.3 % 6.8 % 5.2 %
Remaining rent to be collected 1.6 % % 1.3 % 1.0 %
Total 100.0 % 100.0 % 100.0 % 100.0 %

(i) Based on total of Q2 2020 to Q4 2020 for respective items out of total of billed gross rents for the three quarters.
(ii) Includes $2.9 million of security deposits applied in Q3 2020, representing approximately 1.1% of billed gross rents for that quarter. Total cash collected includes CECRA funding received.
   
  • Most tenants with deferred rents have been paying their deferred rents based on definitive payment schedules. RioCan is confident in the collectability of the 2.0% in deferred rents and 1.0% in remaining rents to be collected.
  • Based on annualized net rent as of December 31, 2020, approximately 78.8% of the Trust's tenants are classified as "strong" or "stable" and 98.1% of total gross rents billed to these tenants in the Fourth Quarter have been collected in cash.  Cash rent collection from the remaining "potentially vulnerable" tenants was 81.4% as they are more impacted by the pandemic. The timing of tenants' submissions for CERS and the administrative process required for eligible tenants to receive CERS funding could also have had an impact on the cash rent collection from these tenants in the short-term.
  • #l@1
          Tenant Composition % of Annualized Net Rent Q4 2020 Cash RentCollection % (iv) Strong (i) 61.1 % 99.4 % Stable (ii) 17.7 % 93.8 % Subtotal 78.8 % 98.1 % Potentially Vulnerable (iii) 21.2 % 81.4 % Total 100.0 % 94.2 % #t@4

    (i) Strong is represented by, or includes, national office tenants and essential / necessity / value / and specialty retail tenants that have strong rent paying ability in the current pandemic impacted environment and also includes residential tenants. (ii) Stable is represented by, or includes, tenants with reasonably strong uses and good rent paying ability or tenants with medium uses in the current environment but strong rent paying ability. (iii) Potentially Vulnerable, particularly under COVID-19 includes tenants with uses that are significantly impacted by the pandemic (such as movie theatres, gyms, sit-down restaurants) as well as uses that were of concern prior to the pandemic (such as apparel) or tenants whom the Trust has concerns over tenant rent paying ability under the COVID-19 circumstances. (iv) Includes tenant direct cash collection as of February 10, 2021 relating to Q4 2020 billed gross rents. The CECRA program ended in September 2020 and therefore, there was no CECRA government funding during the Fourth Quarter.     #t@5
    • As of February 10, 2021, the Trust has collected 91.7% of the billed January gross rents in cash. Approximately 23% of the Trust's tenants are currently closed with much more extensive and restrictive closures mandated in certain provinces. While the length and extent of such mandated closures are difficult to predict, the strength of the Trust's tenant base offers significant downside protection. 
    • Furthermore, RioCan holds approximately $28.6 million of security deposits and approximately $4.6 million in letters of credit from a number of tenants which can serve to offset rents owed on a tenant-by-tenant basis in the event of unresolved tenant defaults.
    • The Trust continues to work with those tenants whose businesses have been affected by the pandemic. The Trust accrued a $9.0 million provision for rent abatements and bad debts (collectively the "pandemic related provision") for the Fourth Quarter, resulting in a total pandemic related provision of $42.5 million for the year. This provision includes a CECRA abatement of $14.4 million for the year. In the limited circumstances where abatement was provided in favor of a tenant, other than in the case of the CECRA program, RioCan typically received concessions of value in exchange, such as development rights, lease term extensions or waiver of exclusivity provisions.
    • #l@2

      FFO and Net Income

      • For the Fourth Quarter, FFO per unit was $0.39, a decrease of $0.02 per unit from Q3 2020. Excluding the $11.4 million inventory gains mainly from the sale of 50% interest in the inventory project at Dufferin Plaza in the prior quarter, FFO per unit in the recent quarter increased primarily due to lower pandemic related provision and stable property performance.
      • FFO per unit was $1.60 for the year, in line with management guidance but a decrease of $0.27 per unit over the prior year, primarily driven by the $42.5 million pandemic related provision, $20.8 million lower residential inventory gains due to timing of condominium closings, and 10.0 million higher weighted average units outstanding due to the private placement and equity issue in 2019. 
      • The Trust reported a net loss of $64.8 million for the year, compared to net income of $775.8 million in the prior year. The year over year change was primarily because the Trust wrote down 3.7% or $526.8 million of fair value of investment properties in 2020 as a result of the pandemic, while the Trust recorded fair value gains of $247.6 million in the pre-pandemic 2019 primarily driven by higher stabilized net operating income on income properties, updated valuation estimates on specific development properties and capitalization rate reductions in certain urban market assets.
      • #l@3

        Same Property NOI - Commercial

        • Same property NOI decreased by 7.9% for the Fourth Quarter and by 6.5% for the year for the overall commercial portfolio when compared to the same respective periods in the prior year mainly due to the pandemic related provision.
        • Excluding the pandemic related provision, same property NOI would have decreased by 2.6% for the Fourth Quarter and by 0.2% for the year. Even though these results remove the effects of the provision, they still reflect certain other effects of the pandemic on property operations such as on occupancy.
        • #l@4

          Operations - Commercial

          • Despite reinstated restrictive measures and store closures mandated in certain key provinces to flatten the curve of the second wave of the pandemic during the Fourth Quarter, committed and in-place occupancy at RioCan's commercial properties held up well and ended the year at 95.7% and 94.9%, respectively. Retail committed occupancy increased by 10 basis points from the previous quarter despite the circumstances, reflecting the strength of lease renewals and new leases completed during the quarter. One large office tenant consolidated its office space and reduced its existing leased space by approximately 100,000 square feet at one Toronto location, which negatively impacted the Trust's overall committed and in-place occupancy.
          • The Trust completed 1.6 million (at 100%) and 4.9 million (at 100%) square feet of new and renewed leases during the quarter and year and achieved a blended leasing spread of 3.8% and 5.0% for income producing properties for the quarter and year, respectively. New leasing spread for the year was 7.9% for the overall portfolio and 8.3% for major markets properties. The retention ratio was solid at 85.8% for the quarter and 86.7% for the year.
          • Average net rent per square foot for new leases was $43.90 for the quarter, mainly driven by new leases in the development properties, and $32.05 for the year, both well above the Trust's portfolio average net rent of $19.80 per square foot. For the year, most new leases were completed with strong covenant tenants ranging from essential, value and specialty retailers to government and medical office users.
          • RioCan continues to evolve its property mix and tenant mix as it anticipates and adapts to the ever changing retail landscape. As of the year end, 90.5% of RioCan's annualized rental revenue is from Grocery Anchored, Mixed-Use / Urban and Open Air Centres. Year over year, the Trust increased its property mix in Grocery Anchored Centres by 110 basis points to 42.0% while decreasing its mix in Enclosed centres by 40 basis points to 9.5%. 
          • Similarly, with respect to tenant mix, RioCan increased its grocery/pharmacy/liquor tenant mix by 70 basis points and decreased its apparel exposure by 50 basis points in the Fourth Quarter. For the year, the Trust increased its grocery/pharmacy/liquor tenant mix by 110 basis points to 16.9% and decreased its apparel tenant mix by 130 basis points to 6.9%. The Trust's tenant mix in essential personal services, value retail, and specialty retail also increased during the year whereas its exposure to movie theaters decreased.
          • #l@5

            Operations - Residential

            • The Trust's growing purpose-built RioCan Living™ residential rental portfolio currently includes 1,218 residential rental units (at 100%) among four buildings - eCentral™ in Toronto, Frontier™ in Ottawa, Brio™ in Calgary, and the most recent addition, Pivot™ in Toronto. Frontier has achieved stabilized occupancy while the three remaining rental towers are in various phases of lease-up.
            • Total NOI from residential rental operations was $8.2 million for the the year, up by $5.8 million from the prior year. Residential rental accounted for approximately 1.6% of the Trust's annualized rental revenues as of  December 31, 2020.
            • As of February 10, 2021, Frontier was 97.8% leased at an average monthly rent of $2.52 per square foot while eCentral was 86.3% leased at an average monthly rent of $3.85 per square foot for market rent units. First occupancy at the 361-unit Pivot in Toronto took place in December 2020 and the building was 10.8% leased as of February 10, 2021 at an average monthly rent of $3.61 per square foot for market rent units.
            • While leasing at eCentral and Pivot has been impacted by the pandemic, the Trust is confident in the long term strategic importance and net asset value growth prospect of its residential rental business. This was further supported by the successful closing of the sale of a 50% non-managing interest in eCentral and commercial component of ePlace subsequent to year end at attractive 3.5% and 4.5% capitalization rates, respectively, based on stabilized NOI. 
            • Despite being launched in the midst of the COVID-19 pandemic in late March, and in Calgary which has also been impacted by the prolonged oil crisis, Brio was 59.3% leased as of February 10, 2021, up by 6.8% from the prior quarter end and at an average monthly rent of $2.54 per square foot. This highlights the resilience of well-located and well-designed buildings, as well as the management expertise of RioCan and its partner Boardwalk REIT.
            • The Trust collected 98.2% of the Fourth Quarter's billed residential rents as of February 10, 2021.
            • #l@6

              Capital Recycling

              • Despite a relatively less active transaction market under the pandemic, the Trust closed $193.1 million of dispositions, of which $66.3 million were income producing assets at a weighted average capitalization rate of 6.31% based on in-place NOI and the remaining $126.8 million were properties with no in-place NOI. Further, as of February 10, 2021, the Trust closed or entered into firm or conditional agreements to dispose 100% or partial interests in a number of properties for total sales proceeds of $289.6 million, including $150.8 million for the sale of a 50% non-managing interest in eCentral and in the commercial component of ePlace, which closed subsequent to the year end. 
              • All together, closed, firm and conditional deals since the beginning of 2020 totaled $482.6 million, consisting of $240.9 million of income producing properties and $241.8 million of development properties. The income producing properties under the closed, firm and conditional deals have a weighted average capitalization rate of 5.53% based on in-place NOI.
              • As previously announced, a number of these transactions involve the sale of partial interests in development properties or future density, as well as closing of prearranged air rights sales. They allow the Trust to not only realize inherent density value, recycle capital to fund its mixed-use development program, but also to mitigate risk, share costs, earn additional fee income, and attract new partners or strengthen existing partner relationships. The quality of RioCan's assets are evident in the pricing achieved and in the well-respected and established partners attracted despite uncertainty during challenging pandemic circumstances.
              • #l@7

                Development Highlights

                • Purpose-built RioCan Living residential rental properties, as well as condominium and townhouse projects, remain a cornerstone of RioCan's development program. Residential development represents 83.2% or 34.7 million square feet of the Trust's current estimated development pipeline of 41.8 million square feet. 
                • During the year, the Trust completed 529,000 square feet of development completions, consisting of 330,000 square feet of  residential rental space at Brio and Pivot, and 199,000 square feet of commercial space consisting mostly of grocery-anchored space at mixed-use developments such as 5th & THIRD™ and Windfields Farm. The successful leasing and completion of the commercial components of the two latter projects demonstrated the inherent benefit of the Trust's mixed-use development strategy as astute retail tenants understand the opportunities that arise from being part of and servicing new communities such as these.
                • In addition to the 1,218 residential rental units in operation and lease-up as noted earlier, the Trust has 1,453 residential rental units currently under construction among six projects and estimates to have an additional 1,542 residential rental units in different phases of development by 2022, including construction.
                • The Trust has a 50% interest in three condominium or townhouse projects at various phases of pre-sale and construction: the prestigious Yorkville condominium project, 11 YV, in Toronto, and the U.C. Uptowns™ townhouse project and U.C. Tower™ condominium project at the Windfields Farm development in Oshawa, Ontario. Combined, these projects represent 1,242 units and are 98% pre-sold on average as of February 10, 2021. Expected project completion dates are Q2 2022 for U.C. Uptowns, Q1 2023 for U.C. Tower and Fall 2024 for 11 YV with estimated inventory gains of $5.0 million to $5.5 million, $14.0 million to $16.0 million, and $68.0 million to $73.0 million, respectively. In addition, the Trust has seven other active condominium or townhouse projects in various stages of development, totalling an estimated 3,730 units, which are scheduled to be completed in phases between 2024 and 2027.
                • The office tower at The Well™, the tallest building in the complex, has reached the final 36th storey and is expected to be topped off in March 2021. The cladding and curtain wall installation is underway, further defining the exterior. The project is on track for the initial office tenants to take possession in 2021. West of the office tower, the podium level is taking shape for the 592-unit residential rental building to be built by RioCan and its partner, Woodbourne Canada Partners, and the above grade construction is now revealing the multi-level galleria and its distinctive curving path.
                • The pandemic did not have a material impact on the pace of the Trust's construction projects in 2020. The Trust incurred a total of $493.4 million development expenditures in the year, before netting the $57.1 million  in air rights sales proceeds. As of December 31, 2020, properties under development and residential inventory accounted for 10.3% of the Trust's consolidated gross book value of assets, well under the 15% limit permitted under its unsecured operating line of credit and other credit facilities agreements.
                • For 2021, RioCan’s development spending is estimated to be in the $500 million range, net of expected cost recoveries and air rights sales. This estimate range includes approximately $400 million on properties under development and approximately $100 million related to residential inventory projects. Inventory projects enable the Trust to accelerate capital recycling to further fund its development program. The Trust expects to maintain its total development on the consolidated balance sheet as percentage of consolidated gross book value of assets at approximately 10% or lower.
                • As most of the Trust's development projects are considered essential projects under  current government guidelines, we do not expect material slowdowns in construction in 2021 despite the pandemic. For 2022 and beyond, development spending is expected to be lower than that of 2021 due to the completion of a significant portion of The Well in 2021, staggered development starts, and sharing of development costs and risks with existing and future strategic partners.
                • #l@8

                  Ample Liquidity and Balance Sheet Strength

                  • RioCan continued to maintain ample liquidity. As of December 31, 2020, the Trust had $1.6 billion of liquidity in the form of cash and cash equivalents and undrawn lines of credit on a proportionate share basis, partly as a result of the $500 million green bond senior unsecured debentures issued in the Fourth Quarter. RioCan had a large unencumbered asset pool of $8.7 billion as of the year end on a proportionate share basis, which generated 58.9% of RioCan's annualized NOI and provided 2.15x coverage over its unsecured debt.
                  • On December 3, 2020 the Trust announced a one-third reduction to its monthly distribution to Unitholders from $0.12 per unit to $0.08 per unit, or from $1.44 to $0.96 on an annual basis, effective for the Trust's January 2021 distribution. This distribution decrease is expected to provide $152.0 million of additional cash flow a year. It will allow the Trust to have much lower payout ratios and also use this additional capital to fund initiatives that drive long-term net asset value growth for Unitholders such as its mixed-use developments, unit buybacks through its normal course issuer bid program, and debt repayments. The Board of Trustees reevaluates the distribution on a regular basis, taking into account various factors including, but not limited to, market stabilization as the health crisis dissipates, cash flow and leverage.
                  • Debt to Adjusted EBITDA was at 9.47x and debt to total assets was at 45.0% as of December 31, 2020, both on a proportionate share basis. The increase in the two metrics relative to the previous quarter were primarily due to the pandemic's impacts on the Trust's property operations and valuations over three quarters in 2020 and the timing of development spending and completions. The Trust's long-term goal remains to lower the two metrics to its target ranges, although it expects them to marginally increase in the near term during the pandemic particularly given that debt to Adjusted EBITDA is calculated on a twelve-month trailing basis.
                  • On December 14, 2020, RioCan issued $500.0 million principal amount of Series AD senior unsecured debentures. These debentures were issued at par, carry a coupon rate of 1.974% per annum and mature on June 15, 2026.   These Series AD debentures are RioCan's second green bond issuance.
                  • Subsequent to year end, on January 15, 2021, RioCan redeemed, in full, its $250.0 million, 3.716% Series R unsecured debenture due December 13, 2021, in accordance with their terms, at a total redemption price of $256.8 million, plus accrued and unpaid interest of $0.8 million, up to but excluding, the redemption date.
                  • #l@9

                    Environmental, Social and Governance (ESG) Priorities and Progress

                    • RioCan embeds ESG practices in every aspect of its business, including developments, operations, investment activities and corporate functions with a goal to be among the leaders in embedding sustainability practices throughout its business by 2020. This year, RioCan has met this goal with industry leading accomplishments.
                    • During 2020, RioCan achieved a 5 Star rating in the GRESB 2020 Real Estate Assessment with a score of 85, ranked first amongst its Canadian peers in the GRESB Public Disclosure Assessment, became the first REIT in Canada to launch a Green Bond Framework and issued two green bonds totalling $850 million, earned recognition as one of the Top 100 employers in the Greater Toronto’s Top Employers competition, and increased properties with Building Owners and Managers Association Building Environmental Standards (BOMA BEST) certifications to 50% of its commercial portfolio. 
                    • Building on RioCan’s commitment to good corporate citizenship, the Trust established the RioCan Diversity, Equity & Inclusion Council, and signed the BlackNorth CEO Pledge and the Inclusive Local Economic Diversity Opportunity (ILEO).
                    0

                    Conference Call and Webcast

                    Interested parties are invited to participate in a conference call with management on Thursday, February 11, 2021 at 9:00 a.m. (ET). Participants will be required to identify themselves and the organization on whose behalf they are participating.

                    In order to participate, please dial 647-427-3230 or 1-877-486-4304. For those unable to participate in the live mode, a replay will be available at 1-855-859-2056, passcode 6966094#.

                    For a copy of the slides to be used for the conference call or, to access the simultaneous webcast, visit RioCan’s website at http://investor.riocan.com/investor-relations/events-and-presentations/ and click on the link for the webcast.

                    About RioCan

                    RioCan is one of Canada’s largest real estate investment trusts.  RioCan owns, manages and develops retail-focused, increasingly mixed-use properties located in prime, high-density transit-oriented areas where Canadians want to shop, live and work. As at December 31, 2020, our portfolio is comprised of 223 properties with an aggregate net leasable area of approximately 38.3 million square feet (at RioCan's interest) including office, residential rental and 14 development properties.  To learn more about us, please visit www.riocan.com.

                    Basis of Presentation and Non-GAAP Measures

                    All figures included in this News Release are expressed in Canadian dollars unless otherwise noted.  RioCan’s consolidated financial statements ("2020 Annual Consolidated Financial Statements") are prepared in accordance with International Financial Reporting Standards (IFRS).  Financial information included within this News Release does not contain all disclosures required by IFRS, and accordingly should be read in conjunction with the Trust's 2020 Annual Consolidated Financial Statements and MD&A for the year ended December 31, 2020, which is available on RioCan's website at www.riocan.com and on SEDAR at www.sedar.com.

                    Consistent with RioCan’s management framework, management uses certain financial measures to assess RioCan’s financial performance, which are not in accordance with generally accepted accounting principles (GAAP) under IFRS.  Funds From Operations (“FFO”), Same Property NOI, Debt to Adjusted EBITDA, Ratio of Total Debt to Total Assets, RioCan's Proportionate Share, Unencumbered Assets to Unsecured Debt and Total Enterprise Value, as well as other measures that may be discussed elsewhere in this News Release, do not have a standardized definition prescribed by IFRS and are, therefore, unlikely to be comparable to similar measures presented by other reporting issuers. RioCan supplements its IFRS measures with these Non-GAAP measures to aid in assessing the Trust’s underlying performance and reports these additional measures so that investors may do the same.  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 full definitions of these measures, please refer to the "Non-GAAP Measures” section in RioCan’s MD&A for the year ended December 31, 2020.

                    Forward-Looking Information

                    This News Release contains forward-looking information within the meaning of applicable Canadian securities laws. This information reflects RioCan’s objectives, our strategies to achieve those objectives, as well as statements with respect to management’s beliefs, estimates and intentions concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking information generally can be identified by the use of forward-looking terminology such as “outlook”, “objective”, “may”, “will”, “would”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plan”, “continue”, or similar expressions suggesting future outcomes or events. Such forward-looking information reflects management’s current beliefs and is based on information currently available to management.  All forward-looking information in this News Release is qualified by these cautionary statements. Forward-looking information is not a guarantee of future events or performance and, by its nature, is based on RioCan’s current estimates and assumptions, which are subject to numerous risks and uncertainties, including those described in the “Risks and Uncertainties” section in RioCan's MD&A for year ended December 31, 2020 and in our most recent Annual Information Form, which could cause actual events or results to differ materially from the forward-looking information contained in this News Release.  General economic conditions, including interest rate fluctuations, may also have an effect on RioCan’s results of operations. 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 gradual recovery and growth of the retail environment and the general economy over 2021; relatively historically low interest costs; a continuing trend toward land use intensification at reasonable costs and development yields, including residential development in urban markets; access to equity and debt capital markets to fund, at acceptable costs, future capital requirements and to enable our refinancing of debts as they mature; the availability of investment opportunities for growth in Canada; the timing and ability for RioCan to sell certain properties; the valuations to be realized on property sales relative to current IFRS values; and the Trust's ability to utilize the capital gain refund mechanism. 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 this forward-looking information.

                    Given the current level of uncertainties arising from the COVID-19 pandemic, there can be no assurance regarding the impact of COVID-19 on the business, operations, and financial performance of RioCan and its tenants, as well as on consumer behaviors and the economy in general. General risks and uncertainties related to the COVID-19 pandemic also include, but are not limited to, the length, spread and severity of the pandemic; the timing of the roll out and efficacy of the vaccines, the nature and length of the restrictive measures, implemented or to be implemented by various levels of government in Canada; RioCan's tenants' ability to pay rents as required under their leases; the availability of various support programs that are or may be offered by the various levels of government in Canada; the introduction or extension of temporary or permanent rent control or other form of regulation or legislation that may limit the Trust's ability or its extent to raise rents based on market conditions upon lease renewals or restrict existing landlord rights or landlord' ability to reinforce such landlord rights; domestic and global supply chains; timelines and costs related to the Trust’s development projects; the pace of property lease-up and rents and yields achieved upon development completion; potential changes in leasing activities, market rents and property valuations; the capitalization rates that arm's length buyers and sellers are willing to transact on properties; the availability and extent of rent deferrals offered or to be offered by the Trust; domestic and global credit and capital markets, and the Trust's ability to access capital on favourable terms or at all and its ability to maintain its credit ratings; the total return and dividend yield of RioCan's Units; and the health and safety of our employees, tenants and people in the communities that our properties serve.

                    The forward-looking statements contained in this News Release are made as of the date hereof, and should not be relied upon as representing RioCan’s views as of any date subsequent to the date of this News Release.  Management undertakes no obligation, except as required by applicable law, to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

                    Contact Information

                    RioCan Real Estate Investment Trust Qi Tang Senior Vice President and Chief Financial Officer 416-866-3033 | www.riocan.com
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                    Source: RioCan Real Estate Investment Trust

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