TORONTO, Nov. 27, 2018 (GLOBE NEWSWIRE) -- Nine months after RioCan REIT ("RioCan") (TSX: REI.UN) announced its official entry into the residential market through the residential brand RioCan Living, it is poised to start leasing its first rental development, eCentral, in midtown Toronto.
The 466-unit, purpose-built rental located at Yonge and Eglinton accounts for a fifth of the approximately 2,300 rental units currently under construction in the RioCan Living portfolio. The RioCan Living portfolio could include more than 5,000 completed residential units within the next five years. In addition, there will be residential development commencements in that same period comprising several thousand additional units.
“The launch of RioCan Living this past March was in part motivated by a shortage of new purpose-built rental buildings in large Canadian cities,” says Ed Sonshine, Chief Executive Officer of RioCan. “The government of Ontario’s recent amendment to rent control legislation as it applies to new purpose-built rental development has encouraged RioCan to move forward more expeditiously to expand our rental residential portfolio. RioCan is uniquely positioned to address the void by developing the properties we already own in major markets that are also strategically located on transit lines.”
“Our ability to come to market with a product like eCentral within the same calendar year as our residential brand launch is indicative of the strength of our team and development capability,” adds Jonathan Gitlin, Chief Operating Officer of RioCan. “We have a deep and talented roster of experts in place who are working to deliver best-in-class, professionally managed residential units to the cities and communities that need them most.”
eCentral is a 36-storey rental residence situated within ePlace, a 712,000 square foot (net leasable, or saleable area) mixed-use development that also features retail, office and residential condominiums. Located at the intersection of the Yonge-University subway line and future Eglinton Crosstown LRT, eCentral is the prototypical RioCan Living development, with an emphasis on design, quality, professional management, retail integration and access to transit. Leasing will begin before the end of 2018 and residents will start to move into the building in the first quarter of 2019.
A second RioCan Living development is also slated to begin leasing this year. Frontier is a joint partnership between Killam Apartment REIT and RioCan Living. The 23-storey, 228-unit rental residential development is located adjacent to RioCan’s Gloucester Silver City shopping centre and is steps from the newly built Blair LRT station. Frontier will be the first residence of a five-phase community in the Gloucester neighborhood in Ottawa, and will enter the thriving market in the nation’s capital when leasing opens to prospective residents in December. Zoning is complete for all five phases of the development and site plan approvals are in place for the second phase.
Of the eight rental projects (or 2,300 rental units) actively under construction in the RioCan Living portfolio, five, including eCentral, are located in Toronto, one is in Calgary, and two, Frontier Phase I and II, are in Ottawa. Residents will be welcomed to two of the projects in 2019 and occupancy for an additional three will begin in 2020. These inaugural properties are just the beginning of a healthy pipeline of development opportunities within RioCan’s existing portfolio.
RioCan’s development pipeline consists of its major market assets that are currently income producing, and have excellent intensification potential based on their proximity to existing or proposed transit infrastructure. The pipeline is expected to be a long-term contributor to growing RioCan’s cash flow and enhancing the Trust’s net asset value (NAV). As of September 30, 2018, the Trust’s development pipeline represents 26.5 million square feet of mixed-use space, including retail, residential and office. RioCan has achieved zoning permission for approximately 45% of its development pipeline and an additional 20% has zoning applications submitted.
“Today’s announcement brings our vision of becoming one of the leading residential landlords in the country to life, and demonstrates that our development pipeline is strong, stable, and growing,” says Gitlin.
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About RioCan Living
RioCan Living™ delivers best in class purpose-built rental units and condos along Canada’s most prominent public transit lines. RioCan Living developments leverage RioCan’s vast portfolio of major market retail and mixed-use properties. RioCan Living delivers vibrant transit-oriented communities, developed and managed to impeccable standards and backed by RioCan’s proven track record. For more information about RioCan Living’s active slate of new residential communities visitwww.riocanliving.com.
RioCan is one of Canada’s largest real estate investment trust with a total enterprise value of approximately $13.7 billion at September 30, 2018. 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. Our portfolio is comprised of 250 properties, including 17 development properties, with an aggregate net leasable area of approximately 40 million square feet. To learn more about how we deliver real vision on solid ground, visit www.riocan.com.
This News Release contains forward-looking information within the meaning of applicable Canadian securities laws. This information includes, but is not limited to, statements concerning RioCan’s objectives concerning the RioCan Living brand, its strategies to achieve those objectives, as well as statements with respect to management’s beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, or expectations that are not historical facts. Forward-looking information generally can be identified by the use of forward-looking terminology such as “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 under “Risks and Uncertainties” in RioCan's Management's Discussion and Analysis for the period ended September 30, 2018 ("MD&A") and the Risks and Uncertainties section in RioCan’s AIF, which could cause actual events or results to differ materially from the forward-looking information contained in this News Release. Those risks and uncertainties include, but are not limited to, those related to: rental market conditions; the ability to lease and find new tenants for vacant space; competition; access to debt and equity capital; joint ventures and partnerships; the relative illiquidity of real property, development risk associated with construction commitments, project costs, related zoning and other permit approvals, and changes in Ontario rent control legislation; environmental matters; litigation; and income.
Material factors or assumptions that were applied in drawing a conclusion or making an estimate set out in the forward-looking information may include, but are not limited to: a stable residential rental environment; a continuing trend toward land use intensification, 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. Although the forward-looking information contained in this News Release for the period ended September 30, 2018 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.
The forward-looking information contained in this News Release is made as of the date of this News Release, 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.
Source: RioCan Real Estate Investment Trust