Riocan Real Estate Investment Trust · TSX:REI.UN
Riocan Real Estate Investment Trust — Q4 2024 Earnings Presentation
28 slides from Riocan Real Estate Investment Trust's earnings presentation, Feb 19, 2025
Slide 1: Strength in Retail: Fourth Quarter 2024 Investor Presentation
STRENGTH IN RETAIL FOURTH QUARTER 2024 INVESTOR PRESENTATION East Hills FEBRUARY 18, 2025 Calgary, AB
Slide 2: RioCan at a glance
RioCan at a glance Committed 98.0% Occupancy 178 properties ~32M Sq. Ft. aggregate net leasable area ~20M Sq. Ft. VANCOUVER pipeline 4 assets 1.1M sq.ft.(1) 4.6% (2) zoned for development BBB CALGARY 16 assets MONTREAL 18 assets 1.9M sq.ft. (1) 3.6M sq.ft. (1) investment-grade credit 12.1%(2) EDMONT
Slide 3: Record-High 2024 Overview
Record-High 2024 Overview ACCELERATED DEMAND FOR HIGH-QUALITY RIOCAN SPACE $1.81 2.3% year-over-year growth supported by strong operating 98.0% Maintaining high occupancy with retail FUNDS FROM COMMITTED OPERATIONS (“FFO”) results OCCUPANCY essentially full at 98.7% ADJUSTED PER UNIT (1) (2) ~4.8 Mi
Slide 4: 2025 Outlook
2025 Outlook STRONG 2024 RESULTS UNDERPIN RELIABLE GROWTH IN 2025 2025 Outlook (1) FFO per unit (2)(3) $1.89 to $1.92 ~ 6% increase from prior year (5) The lowest payout ratio among the peer set, enabling significant FFO Payout Ratio (2) ~ 60% cash flow retention to re-invest in the business (6) Com
Slide 5: Favourable market dynamics
Favourable market dynamics LONG-TERM MACRO-TRENDS PRESENT MEANINGFUL DEMAND DRIVERS Population / Demand Evolving Retail / Demand Shortage of Supply ◦ Population fuels demand for real estate ◦ Full omni-channel experience combines ◦ Lack of new retail supply exacerbated ◦ Canada,the fastest growing c
Slide 6: Major Market Advantage
Major Market Advantage RIOCAN'S MAJOR URBAN CENTRE PRESENCE OUTPACES PEER AVERAGE % of rent from Canada's six major markets 92% 94% 74% 68% 69% 66% N/A (1) 2017 Q4 2024 RioCan Peer Average (includes CRR, CRT, FCR and SRU) 1) The baseline year for comparison is 2017 as it is the year prior to the com
Slide 7: Dominant Core Toronto position
Dominant Core Toronto position 7.3M SQ. FT. OF OPERATING ASSETS, WITH AN ADDITIONAL 6.2M SQ. FT (1) OF ZONED DENSITY NLA in Metropolitan Toronto (in millions of sq. ft.) (2) RioCan properties within Metropolitan Toronto RioCan First Capital Choice Properties SmartCentres CT Crombie — 5.0 10.0 1) Squ
Slide 8: Located in prime, in-demand and growing markets
Located in prime, in-demand and growing markets COMPELLING DEMOGRAPHIC PROFILE – WITHIN 5KM RADIUS(1) Dense Population Strong Household Income ~ 273,000 ~ $148,000 ~ $102,000 ~ 154,000 +77% +45% (2) (2) 2017 2024 2017 2024 1) Within 5km radius. Data is updated annually in the second quarter, with th
Slide 9: High-quality, necessity-based retail revenue
High-quality, necessity-based retail revenue 98.0% 88.0% Property committed occupancy (2) strong and stable tenants (3) Type (1) z 58.5% 31.4% • Retail: 85.1% grocery anchored mixed-use / • Office: 10.6% centres (4) urban (4) (5) • Residential Rental: 4.3% 1) Percentage of annualized contractual gro
Slide 10: Necessity-based retail anchor tenants
Necessity-based retail anchor tenants A CURATED AND DIVERSIFIED TENANT BASE PROVIDING CONSUMERS CONVENIENT ACCESS TO EVERYDAY NEEDS Grocery / Pharmacy / Essential Goods Value Liquor & Services Retailers 19.8% 23.9% 12.8% Loblaws / Sobeys / Metro / Walmart / Canadian Tire / PetSmart / Bell / Rogers /
Slide 11: Transitioning to build resilience
Transitioning to build resilience IMPROVING TENANT MIX TO BUILD RESILIENCE AND GENERATE LONG-TERM VALUE New tenants Previous tenants RIOCAN | INVESTOR PRESENTATION (Fourth Quarter 2024) | 11
Slide 12: Demand driven leasing activity and spreads
Demand driven leasing activity and spreads RESILIENT PORTFOLIO DRIVES HIGH PERFORMANCE (1) Retention Ratios Blended Leasing Spreads Average Net Rent PSF 91.5% 18.7% $22.39 86.7% 87.7% 88.6% 83.8% $21.51 $20.98 10.7% $20.16 9.0% $19.80 6.3% 5.0% 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 2020
Slide 13: Best-in-class residential rental
Best-in-class residential rental INCREASING SCALE PROVIDES STRATEGIC OPTIONS 13 Newly built buildings avg. age: 4 years 3,099 (1) 94.6% (2) units occupied 100% CMHC MONTREAL major market financing at 3.57% 3 buildings for 7.7 years (3) CALGARY OTTAWA 263 units (1) 2 buildings GREATER 1) Number of un
Slide 14: Lowest payout ratio retains ~$150 million of free cash flow annually
Lowest payout ratio retains ~$150 million of free cash flow annually WHILE OFFERING ATTRACTIVE TOP TIER YIELDS (2) FFO Payout Ratio (1) Distribution and AFFO yield Peer Average: 71.9% Peer Average (AFFO Yield): 7.5% 8.7% 81.9% 8.6% 7.7% 8.0% 72.0% 73.5% 68.4% 7.3% 6.8% 6.6% 61.9% 63.9% 6.2% 6.3% 6.3
Slide 15: Disciplined and prudent balance sheet management
Disciplined and prudent balance sheet management TARGET (1) Q4 2024 (2) Q4 2023 (2) CAPITAL STRUCTURE METRICS Liquidity (4) N/A $1.7B $2.0B Adjusted Debt to Adjusted EBITDA (5) 8.0x - 9.0x 8.98x 9.28x Unencumbered Assets (3) N/A $8.5B $8.1B ~1.2x Ratio of Unsecured vs. Secured Debt (3) 70% / 30% 57%
Slide 16: Deleveraging Plan on Track with Further Improvements Expected
Deleveraging Plan on Track with Further Improvements Expected Key Drivers: • Ramp up of EBITDA – natural Adjusted Debt to Adjusted EBITDA Within 8.0x - 9.0x Target Range deleveraging from organic growth and with new income from recent and 9.59x 9.51x near-term development deliveries 9.28x • ~ 85% pr
Slide 17: Ample liquidity and laddered debt maturity
Ample liquidity and laddered debt maturity Proforma Debt Maturity Profile (1) 2,000 1,800 The Trust issued $250.0 million Series AN senior unsecured debentures that will mature on March 1, 2027 1,600 1,400 The Trust has redeemed in full its $500.0 million Series AB senior unsecured debenture 1,200 a
Slide 18: Long-term value enhancing opportunities embedded in sizable portfolio
Long-term value enhancing opportunities embedded in sizable portfolio PROVEN TRACK-RECORD AND IN-HOUSE EXPERTISE TO UNLOCK VALUE THROUGH EVERY STEP OF THE DEVELOPMENT PROCESS 43.3M SQ. FT. DEVELOPMENT PIPELINE Zoning application Zoning Shovel Underway (1) submitted approved (1) ready (1) 3.0M 17.8M
Slide 19: Accelerated capital recycling
Accelerated capital recycling CONDOMINIUM / TOWNHOME DEVELOPMENT EXPECTED TO PROVIDE ~$534M IN SALES REVENUE WITH ~$430M EXPECTED BETWEEN 2025 AND 2026 U.C. Tower 2 Queen & VergeTM 11YV U.C. Tower 3 AshbridgeTM Sale Status 94% Pre-sold (3) 100% Pre-sold 96% Pre-sold 40% Pre-sold (3) 90% Pre-sold Ant
Slide 20: Embedding best practices in everything we do
Embedding best practices in everything we do SELECT ACHIEVEMENTS ENVIRONMENT SOCIAL GOVERNANCE LEED Platinum Top 100 Employers AA Rating Awarded LEED Platinum Certification at Recognized as one of Greater Achieved an ESG rating upgrade to AA The WellTM for the retail and office Toronto’s Top 100 Emp
Slide 21: Appendix: Favourable market dynamics
APPENDIX Favourable market dynamics RioCan Durham Ajax, ON RIOCAN | INVESTOR PRESENTATION (March 2022) | 21 RIOCAN | INVESTOR PRESENTATION (Fourth Quarter 2024)
Slide 22: Physical stores - the hub of omni-channel
Physical stores - the hub of omni-channel BRICK & MORTAR IS CENTRAL TO SERVING CUSTOMERS HOW, WHERE AND WHEN THEY WANT Distribution Centre Brick & Mortar Store Home Occupancy costs trending higher Located in industrial park Located in heart of community In-store purchase Delivery from store BOPIS (1
Slide 23: Canadian Retail Real Estate Supply Constrained
Canadian Retail Over the last five years newly Real Estate is constructed retail represents Supply only ~1% of existing supply Constrained 1.0% 0.8% With replacement costs for well- 0.9% 0.6% ~17Sq. located retailFt. well over market 0.9% values, supply constraints are In Millions of Sq. Ft. expecte
Slide 24: Sustainable Demand
Sustainable Demand Square Feet of Retail per Capita(2) RETAIL REAL ESTATE SUPPLY HAS NOT KEPT PACE WITH POPULATION GROWTH IN CANADA (‘000s) Post pandemic, Canada exceeded its immigration plan targets and welcomed more than 1.8 million new Canadians between 2021 and 2024 16.7 Sq. ft. Number of immigr
Slide 25: Retailers continue to expand their physical footprint
Retailers continue to expand their physical footprint “We are building on last year's momentum with a plan for more conversions plus net Per Bank, President & CEO, new stores to add more than 50 additional hard discount stores....with our investment, Loblaw Companies Limited, you'll see us building
Slide 26: Forward-Looking Information
FORWARD-LOOKING INFORMATION All information other than statements of current and historical fact included in this presentation is forward-looking information within the meaning of applicable securities laws. Forward-looking information can generally be identified by the use of forward-looking termin
Slide 27: Non-GAAP Measures
NON-GAAP MEASURES RioCan’s consolidated financial statements are prepared in accordance with IFRS. Consistent with RioCan’s management framework, management uses certain financial measures to assess RioCan’s financial performance, which are not generally accepted accounting principles (GAAP) under I
Slide 28: Head Office
Head Office | RioCan Yonge Eglinton Centre, 2300 Yonge Street, Suite 2200, Box 2386, Toronto, Ontario M4P 1E4 • 1-800-465-2733 • riocan.com RIOCAN | INVESTOR PRESENTATION (Fourth Quarter 2024)
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