Riocan Real Estate Investment Trust · TSX:REI.UN
Riocan Real Estate Investment Trust — Q3 2020 Earnings Presentation
29 slides from Riocan Real Estate Investment Trust's earnings presentation, Oct 29, 2020
Slide 1: Building for Tomorrow, Strengthening Today
BUILDING FOR STRENGTHENING TODAY, TOMORROW Investor Presentation Q3 2020 | October 2020
Slide 2: About RioCan
90.2% 1 Retail: 8.1% 1 About RioCan Office: ~78% Residential: 1.7% 1 High quality portfolio of tenants concentrated in Canada’s major Increasingly Providing Strong or markets with a strong, Mixed-Use Portfolio Stable Income diversified and largely defensive tenant base ~42M Sq. Ft. 96.0% Development
Slide 3: Why Invest in RioCan
Why Invest in RioCan • High quality, sustainable income given our tenant composition, low enclosed mall exposure and major market concentration • NAV creation and additional income through scaled development program with in-house expertise and advanced zoning entitlements ahead of peers • Balance sh
Slide 4: Highly compelling investment opportunity
Deep % Highly compelling investment opportunity Discount Current negative sentiment will shift when health crisis dissipates 18.0x Dislocated trading price represents 15.0x tremendous value 12.0x 5-year avg in RioCan units FFO Multiple: 9.0x1 Current 5-yr Avg 13.2x FFO Multiple Vs FFO Multiple 9.0x
Slide 5: RioCan locations – Where Canadians Live, Work and Shop
High Quality, Sustainable Income RioCan locations – Where Canadians Live, Work and Shop Concentrated in transit corridors of Canada’s fastest growing major markets Dense Population 201,3261 People Strong Household Incomes $117,9181 Last Mile Hub Ideal for micro-fulfillment and Buy Online Pick-up In
Slide 6: Rent Collection during COVID-19
High Quality, Rent Collection during COVID-191 Sustainable Income Positive trend through the quarter with 93%2 of tenants currently open Rent Collection Trend Rent Collection by Tenant Type (% billed gross rent) (% billed gross rent) ~94% ~91% 0.5% 78% of tenants ~6% ~61% ~93% 97% Q3 cash rent colle
Slide 7: Strategic leasing that provides necessities for communities
High Quality, Sustainable Income Strategic leasing that provides necessities for communities Complementary necessity-based and value-oriented tenancies mitigate risks Low Exposure to Increasing Exposure Declining Retail Concepts % of Annualized Confirmed closures Retailers restructuring total rental
Slide 8: Well-positioned portfolio retains and attracts tenants
High Quality, Sustainable Income Well-positioned portfolio retains and attracts tenants Strong leasing activity despite pandemic 19.8% 89.4% 88.4% 83.1% New Retention Leasing 9.2% Ratio Spread 6.7% (%) (%) Q1 2020 Q2 2020 Q3 2020 1 Q1 2020 Q2 2020 Q3 2020 Renewal Blended Leasing 5.3% 4.6% 4.6% Leasi
Slide 9: Additional sources bolster traditional income stream
High Quality, Sustainable Income Additional sources bolster traditional income stream RioCan has access to various avenues to generate income and cash flow Diversity of asset types: • Mixed-use developments increasingly expanding our exposure to office and residential NOI Inherent value in portfolio
Slide 10: Value creation through mixed-use development
NAV Creation Value creation through mixed-use development With highest zoning entitlements among peers Total Pipeline by Zoning Status • ~100% located in Canada’s six major markets 7.3M SF, 17% Zoning • ~73% located in the GTA Approved • ~99% of projects are mixed-use Zoning residential projects 42M
Slide 11: RioCan's development program offers multiple benefits
NAV Creation Enhancing quality and security of income with diversification into RioCan’s residential rental Asset development Diversification program offers Yield Enhancement - example multiple Development Yield based Corp CHMC Levered Development Leverage financing benefits on IFRS Cost 5.5% 42% 1.
Slide 12: Proven mixed-use experience and value creation
NAV Proven mixed-use experience and value creation Creation Total estimates as of Q3 2020 for five recently completed development projects $574.9M $32.1M 5.6% $752.3M $203.6M Total Estimated Estimated Yield on Estimated Total Estimated Estimated Net Stabilized Total Costs Future Stabilized Increment
Slide 13: Unlocking the full potential of transit-oriented locations
NAV Creation Unlocking the full potential of transit-oriented locations RioCan’s selected developments mapped to Toronto transit system Demographics, 5km radius Toronto Pearson Average population1: ~320K International Airport Average household income1: ~$132K Post-secondary education: ~62% Legend1 U
Slide 14: RioCan Living – High Quality Rental Residences
NAV RioCan Living – High Quality Rental Residences Creation Strong leasing velocity amidst the pandemic eCentral, Toronto, ON Frontier, Ottawa, ON Brio, Calgary, AB • 466 units, 36-storey building • 228 unit, 23-storey building • 163 unit, 12-storey building • ~92% leased as of Oct. 28, • 100% of Ph
Slide 15: Condo / Townhouse development and value creation
NAV Condo / Townhouse development and value creation Creation Strong pre-sales for condos and townhomes despite the pandemic Yorkville Condos Windfield Condos Windfield Townhomes (11YV) (U.C. Tower) (U.C. Uptowns) ~99% of the 586 units pre-sold as of ~95% of the 503 units pre-sold as of Effectively
Slide 16: Disciplined and prudent balance sheet
Balance Sheet Strength Capital Structure Metrics Target Q3 20201 Disciplined Liquidity n/a $803M and prudent Debt to Adjusted EBITDA <8.0x 9.13x2 balance sheet Debt to Total Assets 38% - 42% 44.8% management Interest Coverage >3.0x 3.22x Debt Service Coverage >2.25x 2.71x Ample liquidity Fixed Charg
Slide 17: Appendix and Feature Projects
2323 Yonge St. 2345 Yonge St. APPENDIX AND FEATURE PROJECTS Investor Presentation Q3 2020 | RioCan | 17
Slide 18: Value creation underway
Value creation underway Development pipeline: 59 projects delivering 42M square feet of NLA • 21 projects already under Estimated Density (NLA) at RioCan's Interest # of projects Commercial Residential Air Rights Sale Residential Total construction and on track for Rental Inventory completion in the
Slide 19: Mixed-use Residential Projects Currently Under Construction
Mixed-used Residential Projects Currently Under Construction Projects # of Cost to Total Est. Value ($ in millions and thousands of sq. ft.) Location RioCan Ownership % (Partner) ft) Total NLA residential ('000s sq. at Riocan Interest units at 100% date at RioCan Interest Cost at RioCan Interest Inv
Slide 20: RioCan Colossus Centre
HWY 400 HWY 407 HWY 7 VAUGHAN, ON RIOCAN COLOSSUS CENTRE Investor Presentation Q3 2020 | RioCan | 20
Slide 21: RioCan Colossus Centre
• >50 acre site currently consisting of 571k sq. ft of income producing retail • ~10M sq. ft. of mixed-use density contemplated involving VAUGHAN, ON multi-phase development RIOCAN COLOSSUS CENTRE Investor Presentation Q3 2020 | RioCan | 21
Slide 22: The WELL
• 36-storey, 1.1 million square feet1 of office – 84% pre-leased • ~420k square feet of retail • 592-unit residential rental under construction TORONTO THE WELL Investor Presentation Q3 2020 | RioCan | 22
Slide 23: The WELL
TORONTO THE WELL Investor Presentation Q3 2020 | RioCan | 23
Slide 24: Yonge Sheppard Centre & Pivot
• ~315k sq. ft. of office • ~305k sq. ft. of retail • 36-storey, 361 unit residential rental - completed TORONTO YONGE SHEPPARD CENTRE & PIVOT Investor Presentation Q3 2020 | RioCan | 24
Slide 25: Frontier & Latitude
Frontier, Phase 1 – 100% leased • 33-storey, 228 unit residential rental Latitude, Phase 2 – under construction based on success of Phase 1 Gloucester • 20-storey, 209 unit residential rental Frontier & Latitude Investor Presentation Q3 2020 | RioCan | 25
Slide 26: Litho
• 8-storey, 210 unit residential rental • ~30.5k sq. ft. of retail • Under construction for completion Summer 2021 Toronto Litho Investor Presentation Q3 2020 | RioCan | 26
Slide 27: Strada
• 7-storey, 61 unit residential rental • ~5.6k sq. ft. of retail • Under construction for completion Spring 2021 Toronto Strada Investor Presentation Q3 2020 | RioCan | 27
Slide 28: Non-GAAP Measures and Forward-Looking Information
NON-GAAP FORWARD LOOKING MEASURES INFORMATION RioCan’s consolidated financial Certain information included in this presentation contains forward-looking statements within the meaning of applicable statements are prepared in accordance securities laws including, among others, statements concerning ou
Slide 29: RioCan
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RioCan Real Estate Investment Trust — Q3 2020 Earnings Presentation on 6ix