RioCan Real Estate Investment Trust

RioCan Real Estate Investment Trust

March 07, 2005 12:28 ET

RioCan Real Estate Investment Trust Announces Redemption of October 31, 2007 7.07% Series A and January 18, 2006 7.20% Series C Unsecured Debentures


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: RIOCAN REAL ESTATE INVESTMENT TRUST

TSX SYMBOL: REI.UN

MARCH 7, 2005 - 12:28 ET

RioCan Real Estate Investment Trust Announces
Redemption of October 31, 2007 7.07% Series A and
January 18, 2006 7.20% Series C Unsecured Debentures

TORONTO, ONTARIO--(CCNMatthews - March 7, 2005) - MEDIA RELEASE IS NOT
FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES

RioCan Real Estate Investment Trust (TSX:REI.UN) ("RioCan") announced
today that it has obtained the necessary debentureholder consents to
permit the redemption of its October 31, 2007 7.07% Series A and January
18, 2006 7.20% Series C senior unsecured debentures ("As" and "Cs",
respectively). As such, RioCan has issued notices of redemption to
holders of the As and Cs. The As and Cs will be redeemed on March 11,
2005, in accordance with previously announced terms, at a redemption
price of $109.809 plus accrued and unpaid interest of $2.537452, and
$103.797 plus accrued and unpaid interest of $1.025753, respectively,
both per $100 principal amount.

RioCan today also announced that it has agreed to issue, on a bought
deal basis, $150 million principal amount of senior unsecured debentures
with a maturity date of March 11, 2013 and a coupon rate of 5.23%. A
syndicate led by RBC Capital Markets is underwriting the offering.
Closing of this issue is expected on or about March 11, 2005. This
offering is being made under RioCan's shelf prospectus dated February
21, 2005 and the net proceeds from it will be used to redeem the As and
Cs as well as for general Trust purposes. The debentures have been
provisionally rated BBB- by Standard & Poor's and BBB (Stable) by
Dominion Bond Rating Services.

Edward Sonshine, Q.C., President and C.E.O. of RioCan said, "RioCan is
extremely pleased with our success in redeeming those of our unsecured
debentures which have, until now, unduly limited our leverage limits.
Restructuring of these debts coupled with the repayment on maturity of
our April 25, 2005 6.75% Series B unsecured debentures will now enable
us to increase our leverage limit to 60% of the historic book cost of
our total assets. The $350 million of new financings we have arranged
over the past week at generational-low interest rates will greatly
reduce our refinancing requirements through 2008. With the ability to
finance future acquisitions almost exclusively with low cost debt and
internally generated capital, we will be significantly more capable of
being active in an extremely competitive acquisition market. This will
ultimately lead to increased returns to our unitholders."

About RioCan

RioCan's purpose is to deliver to its unitholders stable and reliable
cash distributions, which continuously increase over time. RioCan is
Canada's largest real estate investment trust with total assets of
approximately $4.1 billion. It has ownership interests in a portfolio of
187 retail properties across Canada containing an aggregate of
approximately 45 million square feet, including partners' and shadow
anchors' interests.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    RioCan Real Estate Investment Trust
    Edward Sonshine, Q.C.
    President & CEO
    (416) 866-3018
    www.riocan.com