RioCan Real Estate Investment Trust Announces 20% Gain in Operating FFO for Fourth Quarter and 16% Gain for the Year Ended December 31, 2011

| Source: RioCan Real Estate Investment Trust RioCan Real Estate Investment Trust

TORONTO, ONTARIO--(Marketwire - Feb. 14, 2012) - RioCan Real Estate Investment Trust (TSX:REI.UN) -

HIGHLIGHTS for 2011:

All figures in Canadian dollars unless otherwise noted. RioCan's results are in accordance with International Financial Reporting Standards ("IFRS").

  • RioCan's Operating Funds from operations ("FFO") increased by 16% for the year ended December 31, 2011 to $380 million compared to $329 million for the year ended December 31, 2010. On a per unit basis, Operating FFO increased 8% to $1.43 per unit from $1.33 per unit in 2010;

  • RioCan's Operating FFO increased by 20% to $100 million for the three months ending December 31, 2011 ("Fourth Quarter") compared to $83 million in the fourth quarter of 2010. On a per unit basis, Operating FFO increased 9% to $0.36 per unit from $0.33 per unit in the same period of 2010;

  • During 2011, RioCan acquired interests in 38 properties in Canada and the US aggregating 4.8 million square feet at a purchase price of approximately $1.1 billion at RioCan's interest at a weighted average cap rate of 6.6%;

  • During the Fourth Quarter, RioCan acquired interests in 17 properties in Canada and the US aggregating 2.5 million square feet at a purchase price of approximately $609 million at RioCan's interest at a weighted average cap rate of 6.6%;

  • RioCan achieved a strong renewal rent increase of 14.5% or $2.45 per square foot (including anchor tenants) as the Trust renewed 705,000 square feet during the Fourth Quarter. In 2011, RioCan renewed approximately 3.8 million square feet at an average rent increase of 11.0% or $1.59 per square foot (including anchor tenants);

  • Occupancy improved slightly at year end to 97.6% from 97.5% at September 30, 2011, and increased 20 bps from 97.4% at December 31, 2010;

  • Target has selected 24 of RioCan's locations and is expected to be the anchor tenant at RioCan's St. Clair and Weston Road development in Toronto making RioCan Target's largest Canadian landlord. Target is now RioCan's seventh largest tenant by rental revenue;

  • RioCan announced that it formed a joint venture agreement with Tanger Factory Outlet Centers, Inc. to develop U.S. style outlet centres in Canada and has since purchased its first property (Cookstown Outlet Mall), and has identified four additional development sites;

  • RioCan was the first Canadian REIT to issue Preferred Equity Units, and during the year completed two Preferred Unit offerings (Series A and Series C) for total gross proceeds of $274.5 million;

  • RioCan raised a total of $425 million through two equity offerings (10.1 million units), RioCan's distribution reinvestment plan (3.4 million units) and the issuance of exchangeable units (3.3 million units), and

  • RioCan raised an additional $225 million (Series O) with a five-year unsecured debenture offering at 4.5% in 2011, and subsequent to the year-end, RioCan raised $150 million (Series P) with a five-year unsecured debenture offering at 3.8%.

RioCan Real Estate Investment Trust (TSX:REI.UN) ("RioCan") today announced its financial results for the fourth quarter and year ended December 31, 2011.

"2011 was the second consecutive year in which our acquisitions exceeded $1 billion," said Edward Sonshine, Chief Executive Officer of RioCan Real Estate Investment Trust. "We were able to achieve this without lowering our quality standards whatsoever. In fact, the growth inherent in our significantly expanded portfolio as well as the redevelopment and intensification opportunities therein, lead us to believe that the next several years will be very positive for RioCan."

Financial Highlights

Operating Funds from operations ("FFO")

RioCan's Operating FFO represents the recurring cash flow generated through the ownership and management of income properties. Operating FFO excludes transactional gains as well as the expenditures related to development activities that are no longer capitalized under IFRS. The primary difference between net earnings and Operating FFO is the fair value gain on investment properties.

Operating FFO for the Fourth Quarter, was $100 million ($0.36 per unit) compared to $83 million ($0.33 per unit) in the fourth quarter of 2010. The primary reasons for this increase were: a $19 million increase in net operating income ("NOI"), which was due to acquisitions, same store growth of 1.9% in Canada and 1.2% in the US, the completion of greenfield developments, intensification of existing properties, and increased fee income of $7 million. These increases to Operating FFO were partially offset by increased interest expense of $5 million and higher general and administrative expenses of $4 million during the Fourth Quarter. General and administrative costs were higher due to higher salaries and benefits, as a result of the significant growth of the Trust and higher professional fees and compliance costs.

For the year ended December 31, 2011, Operating FFO was $380 million ($1.43 per unit) compared to $329 million ($1.33 per unit) in 2010. The primary reasons for this increase were: a $70 million increase in NOI largely due to acquisitions, same store growth of 1.1% in Canada and 1.9% in the US, the completion of greenfield developments, intensification of existing properties and increased fee income of $11 million. These increases to Operating FFO were partially offset by increased interest expense of $19 million and increased general and administrative expenses of $6 million in 2011 due to higher compensation costs, higher professional fees and compliance costs.

Net Earnings

RioCan reported net earnings attributable to unitholders for the Fourth Quarter of $242 million ($0.87 per unit) compared to $1.3 billion ($4.94 per unit) for the same period in 2010, a decrease of $1.0 billion ($4.07 on a per unit basis). The decrease is the result of a deferred tax recovery of $1.0 billion in the fourth quarter of 2010, whereas no such deferred tax recovery was recorded in 2011. Excluding the impact of the deferred tax recovery along with the fair value gains on investment property of $146 million, earnings before deferred income tax recovery and fair value gains increased by $14 million in the Fourth Quarter, as compared to the same period of 2010.

RioCan reported net earnings attributable to unitholders for the year ended December 31, 2011 of $873 million ($3.26 per unit) compared to $1.5 billion ($6.06 per unit), a decrease of $622 million ($2.80 on a per unit basis). As noted above, the decrease in earnings is related to a deferred tax recovery of $898 million for the full year of 2010, whereas no such recovery occurred in 2011. Excluding the impact of the deferred tax recovery along with the fair value gains on investment property of $533 million, earnings before deferred income tax recovery and fair value gains increased by $13 million in 2011, when compared to 2010.

Same Store and Same Property NOI

Same store and same property NOI during the Fourth Quarter in Canada increased by 1.9% compared to the same period in 2010. Same property and same store NOI gains were due largely to fixed rent steps, and new and renewal leasing which positively impacted NOI by $5.8 million. Same store NOI was partially offset by vacancies of $3.3 million.

For the year ended December 31, 2011, same store and same property NOI in Canada increased by 1.1% compared to 2010. Same property and same store NOI gains were due largely to fixed rent steps, and new and renewal leasing, which positively impacted NOI by $14 million. Same store NOI was partially offset by vacancies of $8.8 million and higher non recoverable administrative and information technology costs of $0.5 million.

Sequentially, same property and same store NOI increased 2.0% for the Fourth Quarter compared to the third quarter of 2011 primarily due to renewal leasing and fixed rent steps which positively impacted NOI by $3.5 million offset by vacancies, which impacted NOI by $0.9 million.

Excluding the impact of foreign exchange, the US same store and same property NOI during the Fourth Quarter in the US increased by 1.0% when compared to the same period in 2010 and increased 1.9% for the year when compared to 2010. Excluding the impact of foreign exchange, same store and same property NOI declined 1.2% compared to the third quarter of 2011 due to higher non-recoverable costs in the fourth quarter.

Portfolio Stability

As at December 31, 2011:

  • RioCan's Canadian occupancy rate was 97.5%, up 20bps from 97.3% as at December 31, 2010. RioCan's US occupancy rate was down slightly at 98.1% compared to 98.2% at December 31, 2010. RioCan's overall occupancy rate was 97.6% a 20 bps improvement from 97.4% as at December 31, 2010;

  • The portfolio economic occupancy rate represents the occupied net leaseable area for which tenants are paying rent. The portfolio economic occupancy rate was approximately 96.6% compared to 96.1% at December 31, 2010. There is approximately 466,000 square feet of space that has been leased to tenants that are not yet paying rent. The annualized rental revenue impact expected upon commencement of tenants who are yet to start paying rent is $11 million;

  • In the Fourth Quarter, RioCan's retention ratio was 90.5% of expiring leases in line with a renewal retention rate of approximately 93.3% in the fourth quarter of 2010;

  • For the year ended December 31, 2011, RioCan's retention ratio remained steady at 89.4% of expiring leases compared to a renewal retention rate of approximately 90.9% for 2010;

  • Strong rental renewals of approximately 705,000 square feet were renewed during the Fourth Quarter at an average rent increase of 14.5% or $2.45 per square foot (including anchor tenants);

  • Strong rental renewals of approximately 3.8 million square feet were renewed during 2011 at an average rent increase of 11.0% or $1.59 per square foot (including anchor tenants);

  • During 2011, at RioCan's interest, new vacancies were 779,000 square feet, a significant improvement from the 843,000 square feet at RioCan's interest incurred in 2010;

  • RioCan's Canadian portfolio is concentrated in Canada's six high growth markets (including Calgary, Edmonton, Montreal, Ottawa, Toronto and Vancouver). Assets in these markets account for about 65.9% of RioCan's Canadian annualized rental revenue (65.2% at Dec. 31, 2010);

  • National and anchor tenants represented about 85.7% of annualized rental revenue at December 31, 2011, compared to 85.9% at December 31, 2010;

  • Approximately 58.1% of annualized rental revenue was derived from RioCan's 50 largest tenants; and

  • No individual tenant comprised more than 4.7% of annualized rental revenue.

Portfolio Activity and Acquisition Pipeline

RioCan had a very active year again in 2011, acquiring a number of attractive properties in Canada and the US. During the Fourth Quarter RioCan completed the acquisition of 17 properties aggregating $609 million at RioCan's interest. For the year RioCan acquired an interest in 38 properties (24 in Canada and 14 in the US) for an aggregate purchase price of $1.1 billion at RioCan's interest ($506 million in Canada and $567 million in the US).

At December 31, 2011, RioCan's fair value of Income Properties was $10.4 billion based on a weighted average cap rate of 6.53%, a decrease of 35 bps from December 31, 2010 ($8.5 billion based on a weighted average cap rate of 6.88%).

Acquisitions Completed During the Fourth Quarter

Canada

  • Runnymede Portfolio, Greater Toronto Area - a grocery anchored property portfolio of 5 properties containing a total of 361,608 square feet. RioCan acquired a 100% interest in the 5 properties for $91.2 million at a cap rate of 6.3%.
  • Cookstown Outlet Mall, Cookstown, Ontario - 161,750 square foot enclosed shopping centre. RioCan acquired a 50% interest in the property with its partner Tanger Factory Outlet Centers, Inc. for $62 million (at 100%), at a cap rate of 6.5%.
  • Sheppard Centre, Toronto, Ontario - 678,364 square foot, mixed use property. RioCan acquired a 50% interest in the property with its partner KingSett Capital for $218 million (at 100%), at a cap rate of 6.1%.
  • 549 College Street, Toronto, Ontario - 3,721 square foot single tenant retail property leased by the Liquor Control Board of Ontario. RioCan acquired a 100% interest in the property for $3.9 million at a cap rate of 6.0%.
  • 266 King Street West, Oshawa, Ontario - 34,202 square foot new format retail property anchored by Shoppers Drug Mart. RioCan acquired a 100% interest in the property for $13.3 million at a cap rate of 6.7%.
  • Cowichan Commons, Cowichan, British Columbia - 186,629 square foot new format retail property anchored by Canadian Tire. RioCan acquired a 100% interest in the property for $50.1 million at a cap rate of 6.2%.

United States

  • Village Shoppes of Salem, Salem, New Hampshire - 170,270 square foot new format retail centre occupied by Best Buy, Sports Authority, PetSmart, Michaels, and DSW. RioCan acquired a 100% interest for $41 million at a cap rate of 7.0%.
  • Market Street Portfolio, Dallas Texas - a grocery anchored property portfolio of two properties containing a total of 161,000 square feet anchored by Market Street. RioCan acquired a 100% interest in the two properties for $31 million at a cap rate of 7.6%.
  • Alamo Ranch, San Antonio, Texas - a 407,946 square foot new format retail centre shadow anchored by Target, major tenants include Best Buy and Marshalls. RioCan acquired an 80% interest in the property with its partner Inland Western Retail REIT ("Inland Western") for $76 million ($95 million at 100%), at a cap rate of approximately 7.2%.
  • Timber Creek Crossing, Dallas, Texas - a 470,350 square foot new format retail centre anchored by Walmart. RioCan acquired an 80% interest in the property with its partner Dunhill Partners for $69 million ($86 million at 100%), at a cap rate of approximately 6.1%.
  • Cinco Ranch Shopping Center, Houston, Texas - a 97,760 square foot new format retail centre shadow anchored by Target, major tenants include Michaels and Office Max. RioCan acquired an 80% interest in the property with its partner Sterling Organization LLC for $14 million ($18 million at 100%), at a cap rate of approximately 8.0%.
  • 1890 Ranch Shopping Center, Austin, Texas - a 486,900 square foot new format retail centre shadow anchored by Target, major tenants include Ross Dress for Less and PetSmart. RioCan acquired an 80% interest in the property with its partner Inland Western for $80 million ($100 million at 100%), at a cap rate of approximately 7.0%.

Acquisitions Subsequent to Year end

Subsequent to year end, RioCan acquired an additional 10% interest in three properties in Canada from its partner Trinity Development Group ("Trinity") at an aggregate purchase price of $44 million. In connection with its purchase from its partner, RioCan has assumed its proportionate share of the existing mortgage debt that is in place for these properties:

Silver City Gloucester

RioCan acquired an additional 10% interest from Trinity in Silver City Gloucester, which brings RioCan's ownership for this property to 80%. Trinity will retain a 20% interest. RioCan will continue to manage the property. Silver City Gloucester is a 227,223 square foot new format retail centre located in Ottawa, Ontario and is tenanted by national tenants such as Famous Players Silver City, Chapters, and Future Shop. The purchase price for RioCan's additional interest was $7.6 million at a cap rate of 6.25%.

RioCan Colossus Centre

RioCan acquired an additional 10% interest from Trinity in RioCan Colossus Centre, which brings RioCan's ownership for this property to 80%. Trinity will retain a 20% interest. RioCan will continue to manage the property. Located northwest of the Highway 400 and Highway 407 interchange in Vaughan, Ontario, RioCan Colossus Centre is a new format retail centre with approximately 582,632 square feet of leasable area. The site is anchored by a 121,000 square foot Rona, a 101,000 square foot Famous Players (Cineplex) theatre and a 130,000 square foot Costco (shadow anchor). The purchase price for RioCan's additional interest was $17.5 million at a cap rate of 6.25%.

Trinity Common Brampton

RioCan acquired an additional 10% interest from Trinity in Trinity Common Brampton, which brings RioCan's ownership for this property to 80%. Trinity will retain a 20% interest. RioCan will continue to manage the property. Located at the intersection of Highway 410 and Bovaird Drive, this 75-acre site has been developed into a 662,550 square foot new format retail centre. This property is anchored by Famous Players (Cineplex) Theatre, Zellers and Metro, as well as by Canadian Tire and Home Depot, both of whom own their own premises. The purchase price for RioCan's additional interest was $18.7 million at a cap rate of 6.0%.

Acquisition Pipeline

RioCan is in various stages of negotiations with regards to ten properties (eight in Ontario and two in Texas) that represent $123 million of potential acquisitions. Of these ten properties, five are potential development sites in Ontario that represent $53 million of acquisitions, and the remaining five properties represent $71 million in acquisitions of income properties. Due diligence is ongoing and while efforts will be made to complete these acquisitions no assurance can be given.

Liquidity and Capital

In selecting appropriate funding choices, RioCan's objective is to manage its capital structure in such a way as to diversify its funding sources while minimizing its funding costs and risks. During 2011, RioCan raised approximately $1.7 billion ($646 million net of distributions and debt repayments) of capital through a combination of equity, preferred equity, mortgage financing, and debenture offerings.

The 12 month EBITDA interest coverage for RioCan in 2011 was 2.5x. As at December 31, 2011, RioCan's indebtedness net of cash was 46.4% of total assets. As part of RioCan's capital management strategy, it is RioCan's objective to further strengthen its balance sheet as well as improve its coverage ratios over time. RioCan's Net Debt to Adjusted EBITDA in 2011 was 7.3x compared to 6.9x at December 31, 2010. RioCan's Net Operating Debt to Adjusted Operating EBITDA, which excludes debt related to properties under development was 7.1x in 2011 compared to 7.0x in 2010. RioCan's Net Debt to EBITDA and Net Operating Debt to Adjusted Operating EBITDA ratios were negatively impacted by higher debt levels incurred through acquisitions in the Fourth Quarter, which contributed little income in the year due to the timing of when these acquisitions occurred.

Unit Offerings

During 2011, RioCan completed two public offerings of approximately 10.1 million units, in total, for total gross proceeds of about $251.6 million. In the first unit offering, completed in September 2011, RioCan issued 5.1 million units at $24.75 per unit for total gross proceeds of approximately $125.1 million. In the second unit offering, completed in November 2011, RioCan issued 5.1 million units at $24.85 per unit for total gross proceeds of approximately $126.5 million. RioCan also issued 3.3 million exchangeable units for proceeds of $83 million to facilitate various property acquisitions.

During 2011, RioCan became the first Canadian REIT to issue Preferred Units through the completion of two public offerings of Preferred Units (Series A and Series C) that, in total generated total gross proceeds of about $274.5 million. In the first unit offering, Series A, completed in January 2011, RioCan issued five million units at $25.00 per unit at a distribution yield of 5.25% for total gross proceeds of approximately $125 million. In the second unit offering, completed in November 2011, RioCan issued 5.98 million units at $25.00 per unit at a distribution yield of 4.7% for total gross proceeds of approximately $149.5 million.

Mortgage Financing

Canada

In 2011, RioCan obtained approximately $446 million of fixed-rate mortgage financing at a weighted average interest rate of 4.6% with a weighted average term to maturity of about 7.2 years.

US

In 2011, RioCan obtained approximately $172 million of fixed-rate mortgage financing at an average interest rate of 4.6% with a weighted average term to maturity of about 7.1 years.

Unsecured Debentures

The $200 million outstanding Series F debentures, which were due on March 8, 2011, were redeemed on January 20, 2011 and resulted in a prepayment penalty in aggregate of $1.0 million, in accordance with their terms, at a total redemption price of $1,004.89 per $1,000 principal amount.

RioCan raised $225 million in gross proceeds through the issuance of its Series O 5-year, senior unsecured debenture offering (bearing interest at 4.5%) in January 2011. The proceeds were partially used to redeem the $180 million principal amount of Series L senior unsecured debentures. The Series L debentures, which were due on April 3, 2014 and carried an interest rate of 8.3%, were redeemed on February 24, 2011 and resulted in a prepayment penalty in aggregate of $23.7 million, at a total redemption price of $1,131.85 per $1,000 principal amount.

In December 2011 RioCan redeemed its $120 million 5.70% Series K senior unsecured debentures due September 11, 2012. The Series K debentures were redeemed on December 19, 2011, and resulted in a prepayment penalty in aggregate of $3.8 million, at a total redemption price of $1,032.08 per $1,000 principal amount.

Subsequent to December 31, 2011, RioCan completed the offering of $150 million Series P debentures carrying interest at 3.8% due March 2017. The proceeds from the offering were used by RioCan to repay certain indebtedness, for property acquisitions, to fund development and for general trust purposes.

Lines of Credit

RioCan has four revolving lines of credit in place with three Canadian chartered banks, having an aggregate capacity of $429 million (compared to $422 million at December 2010) against which approximately $130 million has been drawn and $26 million has been drawn as letters of credit leaving $273 million available for cash draws under the lines of credit. Subsequent to the year end the $130 million outstanding as of year end was paid down with the proceeds from the Series P debenture offering.

Development Activity

During the three months ended December 31, 2011, RioCan completed 91,000 square feet (three months ended December 31, 2010 - 237,000 square feet) of redevelopment and development activities in the Fourth Quarter. In the Fourth Quarter, RioCan commenced development at its St. Clair and Weston Road project in Toronto, Ontario and expects to begin development on the retail expansion at the RioCan Yonge Eglinton Centre, also in Toronto, in 2012.

For the year ended December 31, 2011, RioCan completed 280,000 square feet (2010 - 262,000 square feet) of redevelopment and development projects in 2011.

As at December 31, 2011, RioCan had ownership interests in 10 greenfield development projects that will, upon completion, comprise about 8.9 million square feet (4.6 million square feet at RioCan's interest).

During the year, RioCan completed several acquisitions of urban parcels to form part of RioCan's urban development pipeline.

Yonge & Eglinton Northeast Corner Assembly

RioCan, along with Metropia and Bazis Inc., residential developers focusing in the City of Toronto, have acquired four parcels of property on the northeast corner of Yonge Street and Eglinton Avenue in Toronto.

The parcels include a 6,230 square foot single tenant building, a 5,283 square foot multi-tenant use building, a 14,960 square foot multi-tenant use building, and a 30-unit apartment building. RioCan acquired a 50% interest in each of the properties at a purchase price of $34 million (at 100%) or $17 million at RioCan's interest. The remaining 50% interest was acquired by Metropia and Bazis Inc.

Other Development Pipeline Acquisitions

RioCan acquired a four parcel assembly in Toronto, located near the intersection of Bathurst Street and College Street at a total purchase price of $20 million ($12 million at RioCan's interest). This 1.3 acre site is expected to be developed into a 139,000 square feet of urban retail building. The site is owned by RioCan 60% and Trinity 40%. RioCan will be responsible for the development of this site.

Herongate Mall was acquired on a 75/25 joint venture basis with its partner Trinity (75% RioCan / 25% Trinity). The property is situated on a 16 acre site in a mature area of Ottawa, Ontario. This is a redevelopment project, which when completed, will be anchored by many of the existing tenants at the property including, Metro, Pharma Plus, and Scotiabank. The purchase price was $17 million at 100% ($12.8 million at RioCan's interest). The property was acquired free and clear of financing.

RioCan acquired its partners' two thirds-interest in Windfield Farms, in Oshawa, Ontario, at a cost of $29 million, bringing RioCan's ownership interest to 100%. Windfield Farms is a 160 acre site located at Simcoe Street, in the suburban Greater Toronto Area, adjacent to the proposed Highway 407 extension. The site is designated as a regional retail site and will be able to accommodate up to 1.2 million square feet of development. Development is expected to commence in 2014.

RioCan waived conditions for the acquisition of Sage Hill Crossing, a 32 acre greenfield development site in Northwest Calgary, Alberta. The purchase price for the lands, which will be serviced and zoned at the time of closing, will be $32 million ($16 million at RioCan's interest). RioCan will own the development on a 50/50 basis with KingSett Captial. RioCan will be the property and asset manager of the development. Once completed, the anticipated gross leasable area is 347,000 square feet of retail use. The anticipated closing date is September, 2012. Development is expected to commence in 2013.

RioCan's Audited Consolidated Financial Statements, Management's Discussion and Analysis and a Supplemental Information Package for the year ended December 31, 2011 and 2010 are available on RioCan's website at www.riocan.com.

Conference Call and Webcast

Interested parties are invited to participate in a conference call with management on Tuesday, February 14, 2012 at 10:00 a.m. eastern time. You will be required to identify yourself and the organization on whose behalf you are participating.

In order to participate, please dial 416-340-8530 or 1-877-240-9772. If you cannot participate in the live mode, a replay will be available until March 14, 2012. To access the replay, please dial 905-694-9451 or 1-800-408-3053 and enter passcode 4480535#.

Scheduled speakers include Edward Sonshine, O.Ont., Q.C., Chief Executive Officer, Fred Waks, President and Chief Operating Officer and Rags Davloor, Executive Vice President and Chief Financial Officer. Management's presentation will be followed by a question and answer period. To ask a question, press "star 1" on a touch-tone phone. The conference call operator will be notified of all requests in the order in which they are made, and will introduce each questioner.

Alternatively, to access the simultaneous webcast, go to the following link on RioCan's website http://investor.riocan.com/Investor-Relations/Events-Webcasts/default.aspx and click on the link for the webcast. The webcast will be archived 24 hours after the end of the conference call and can be accessed for 120 days.

About RioCan

RioCan is Canada's largest real estate investment trust with a total capitalization of approximately $12.5 billion as at December 31, 2011. It owns and manages Canada's largest portfolio of shopping centres with ownership interests in a portfolio of 331 retail properties containing an aggregate of 79 million square feet, including 45 grocery anchored and new format retail centres containing 12 million square feet in the United States through various joint venture arrangements. RioCan's portfolio also includes 10 properties under development in Canada. For further information, please refer to RioCan's website at www.riocan.com.

Forward-Looking Information

This news release contains forward-looking statements within the meaning of applicable securities laws. These statements include, but are not limited to, statements made in this News Release (including the sections entitled "Highlights for 2011", "Financial Highlights", "Portfolio Stability", "Portfolio Activity and Acquisition Pipeline", "Liquidity and Capital", and "Development Activities"), and other statements concerning RioCan's objectives, its strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "would", "expect", "intend", "estimate", "anticipate", "believe", "should", "plan", "continue", or similar expressions suggesting future outcomes or events. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. All forward-looking statements in this News Release are qualified by these cautionary statements.

These forward-looking statements are not guarantees of future events or performance and, by their nature, are based on RioCan's current estimates and assumptions, which are subject to risks and uncertainties, including those described under "Risks and Uncertainties" in RioCan's Management's Discussion and Analysis for the years ended December 31, 2010 and 2011, which could cause actual events or results to differ materially from the forward-looking statements contained in this News Release. Those risks and uncertainties include, but are not limited to, those related to: liquidity in the global marketplace associated with current economic conditions, tenant concentrations, occupancy levels, access to debt and equity capital, interest rates, joint ventures/partnerships, the relative illiquidity of real property, unexpected costs or liabilities related to acquisitions, construction, environmental matters, legal matters, reliance on key personnel, unitholder liability, income taxes, the investment in the United States of America ("US"), US currency and RioCan's qualification as a real estate investment trust for tax purposes. Material factors or assumptions that were applied in drawing a conclusion or making an estimate set out in the forward-looking information may include, but are not limited to: a more robust retail environment compared to recent years; relatively stable interest costs; a continuing trend toward land use intensification in high growth markets; access to equity and debt capital markets to fund, at acceptable costs, the future growth program to enable the Trust to refinance debts as they mature; the availability of purchase opportunities for growth in Canada and the US; and the impact of accounting principles to be adopted by the Trust effective January 1, 2011 under International Financial Reporting Standards ("IFRS") which includes application to the Trust's 2011 comparative financial results. Although the forward-looking information contained in this News Release is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. Certain statements included in this News Release may be considered "financial outlook" for purposes of applicable securities laws, and such financial outlook may not be appropriate for purposes other than this News Release.

The Income Tax Act (Canada) (the "Act") contains provisions which potentially impose tax on publicly traded trusts (the "SIFT Provisions"). However, the SIFT Provisions do not impose tax on a publicly traded trust which qualifies as a REIT. RioCan currently qualifies as a REIT and intends to continue to qualify for future years. Should this not occur, certain statements contained in this News Release may need to be modified.

Except as required by applicable law, RioCan under takes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Contact Information:

RioCan Real Estate Investment Trust
Rags Davloor
Executive Vice President & CFO
(416) 642-3554
www.riocan.com