RioCan Real Estate Investment Trust

RioCan Real Estate Investment Trust

September 11, 2009 08:59 ET

RioCan Real Estate Investment Trust Announces Acquisition of Partners' Interests at RioCan Centre Vaughan and RioCan Beacon Hill, Calgary

TORONTO, ONTARIO--(Marketwire - Sept. 11, 2009) - RioCan Real Estate Investment Trust (TSX:REI.UN) ("RioCan") today announced the acquisition of the interests of its partners Strathallen Capital Corp. ("Strathallen"), and Trinity Development Group ("Trinity") in the first phase of RioCan Centre Vaughan. In addition, RioCan has purchased Trinity's interest at RioCan Beacon Hill in Calgary, Alberta. The acquisition brings RioCan's ownership in the first phase of RioCan Centre Vaughan to 100% and brings RioCan's interest in RioCan Beacon Hill to 50%. RioCan has acquired its interests in these sites for a total of approximately $38.0 million.

RioCan Centre Vaughan, a 25 acre site, is comprised of a recently constructed 261,714 square foot new format retail centre in the northwestern section of the Greater Toronto Area at the corner of Highway 27 and Langstaff Road and was constructed as the first phase in a three phase project. The phase acquired, completed in 2009, is anchored by a 212,719 square foot Wal-Mart. Wal-Mart has entered into a ground lease for a 20 year term. The centre also includes an additional 48,995 square feet with tenants including the LCBO and TD Bank. Both Strathallen and Trinity will retain their interests as partners in the remaining development phases that once complete will consist of approximately an additional 284,000 square feet. The first phase being acquired has been financed with 5 year mortgage financing arranged by RioCan of $22 million from a major financial institution at an interest rate of approximately 5.6%.

In addition, RioCan has acquired an additional 10% interest in the new format shopping centre commonly known as RioCan Beacon Hill, Calgary, a 527,918 square foot (787,282 square foot including shadow anchors) shopping centre. The acquisition will bring RioCan's interest in Beacon Hill to 50%. The remaining 50% interest in RioCan Beacon Hill will continue to be held by the Canada Pension Plan Investment Board.

"This additional interest in these high quality properties in two of our core markets represents an excellent opportunity for RioCan to add value to our portfolio with a modest cash investment," said Edward Sonshine, Q.C., President and CEO of RioCan.

About RioCan

RioCan is Canada's largest real estate investment trust with a total capitalization of approximately $7.1 billion as at June 30, 2009. It owns and manages Canada's largest portfolio of shopping centres with ownership interests in a portfolio of 247 retail properties, including 13 under development, containing an aggregate of over 59 million square feet. For further information, please refer to RioCan's website at

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 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. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plan" or "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.

These statements are not guarantees of future events and are based on our estimates and assumptions that are subject to risks and uncertainties, which could cause actual events or results described above to differ materially from the forward-looking statements contained herein. Those risks and uncertainties include risks associated with real property ownership, financing and interest rates, environmental matters and construction. Material factors or assumptions that were applied in drawing a conclusion or making an estimate set out in the forward-looking information include: a less robust economic and retail environment than we have seen for the last few years; interest costs to us remain relatively stable; acquisition capitalization rates increase and land costs for greenfield development decrease; a continuing trend towards land use intensification in high growth markets; and equity and debt capital markets will continue to provide access to capital to fund, at acceptable costs, our future growth program and refinance our debts as they mature. Although the forward-looking information contained herein 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. All forward-looking statements in this press release are qualified by these cautionary statements. 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.

Contact Information

  • RioCan Real Estate Investment Trust
    Edward Sonshine, Q.C.
    President & CEO
    (416) 866-3018