Riocan Real Estate Investment Trust · TSX:REI.UN
Riocan Real Estate Investment Trust — Q3 2017 Earnings Presentation
18 slides from Riocan Real Estate Investment Trust's earnings presentation, Nov 3, 2017
Slide 1: Third Quarter 2017 Conference Call Presentation
Third Quarter 2017 Conference Call Presentation November 3, 2017
Slide 2: Forward Looking Advisory
Forward Looking Advisory In talking about our financial and operating performance and in responding to your questions we may make forward-looking statements including statements concerning RioCan’s objectives, its strategies to achieve those objectives, as well as statements with respect to manageme
Slide 3: Q3 2017 Highlights
Q3 2017 Highlights In comparison to Q3 2016: Same Property NOI FFO per Unit - $0.46 2.4% 7.5% Committed Occupancy In-Place Occupancy 150 BPS 96.8% 240 BPS 96.0% 3
Slide 4: Net Income from continuing operations excluding FV gains
Net Income from continuing operations excluding FV gains Increased 2.7% $ 145.3m $ 141.5m Q3 2016 Q3 2017 4
Slide 5: Funds From Operations
Funds From Operations Improved and approaching Increase of 7.9% Increase of 7.5% target of 80% $151m $0.46 83.6% 80.5% $0.43 $140m Q3 2016 Q3 2017 Q3 2016 Q3 2017 Q3 2016* Q3 2017 FFO FFO per Unit FFO Payout Ratio * excludes Target Settlement 5
Slide 6: Debt Metrics
Debt Metrics Improved debt metrics and all above targets 2.98x 3.78x 2.61x 1.14x 3.36x 1.10x Target >3.0x >2.25x >1.10x Target Dec. 2016 Sept. 2017 Dec. 2016 Sept. 2017 Dec. 2016 Sept. 2017 Interest Coverage Debt Service Coverage Fixed Charge Coverage at RioCan's Interest 6
Slide 7: Leverage Metrics
Leverage Metrics Improved and below target Below upper target range 8.1x Target <42% Target <8.0x 7.6x 40.0% 41.5% Dec. 2016 Sept. 2017 Dec. 2016 Sept. 2017 Debt to Adj. EBITDA Debt to Assets Ratio at RioCan's Interest 7
Slide 8: Key Value Drivers
Key Value Drivers Development Completions Development Pipeline Strategic Partners Capital NCIB Income Producing Properties Same Property NOI Growth RIO*CAN
Slide 9: Development Pipeline
Development Pipeline Total Development Pipeline - 23.8m square feet as of September 30, 2017 Mixed-use Residential: 22.9m sf: 96.1% Residential & Air Rights - 16.3m sf 71.5% Commercial: 0.9m sf: 3.9% Retail - 5.6m sf 24.6% Residential Inventory - 0.9m sf 3.9% at RioCan's Interest 9
Slide 10: Committed and In-Place Occupancy
Committed and In-Place Occupancy 100 150 bps Increase 98 96.7% 96.2% 96.8% 96 95.6% 96.0% 95.1% 95.3% 94.8% 94.4% 95.2% 94.0% 94 93.6% 93.6% 92.8% 92.9% 93.3% 92 240 bps Increase 90 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2017 Committed Occupancy In Place Occupancy 10
Slide 11: Same Property NOI Growth
Same Property NOI 2.2% 2.4% 2.0% 1.9% % Same Propetry NOI Growth 1.5% 0.1% (1.1)% Target exit (2.4)% (2.2)% (3.4)% Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 For Q3 2017 the 2.4% Same Property NOI Growth or $4.0m consists of: • $2.5m related to higher occupancy,
Slide 12: Leasing Results
Leasing Results New Leasing Renewals • $22.20 psf for 376 thousand sf • Retention rate was 93.6% $22.20 5.2% 4.7% $17.64 Q2/17 Q3/17 Q2/17 Q3/17 • Increased mainly due to a • Increase of 5.2% or $0.90 psf greater number of smaller units at higher rents psf • 187 renewals totalling 1.1m sf 12
Slide 13: Development Activity - Project Updates
Development Activity - Project Updates King Portland Centre, Toronto ON • Substantially sold all 133 available condominium units • Condo gains well ahead of original expectations • Office component 93% preleased to Shopify and Indigo 13
Slide 14: Development Activity - Project Updates
Development Activity - Project Updates ePlace (Northeast Corner of Yonge & Eglinton), Toronto ON • Entered into agreement to acquire our partners' 50% interest in the 466 suite rental residential tower • Completion expected in late 2018 or early 2019 14
Slide 15: Development Activity
Development Activity Project Completions Zoning Progress Zoned: 10.8m sf: 45.4% Q3/2017 YTD SF Completed 253k sf 732k sf Future est. density: Costs Transferred $70.5m $170.6m 6.5m sf: 27.3% In 2018, additional 0.7m sf to be completed Application submitted: 6.5m sf: 27.3% Total pipeline 23.8m sf 15
Slide 16: Acceleration of Major Market Strategy
Acceleration of Major Market Strategy • The primary markets have consistently demonstrated higher occupancy and higher rent growth • The acceleration of our major market strategy will increase the quality, growth profile, and resilience of our portfolio in the ever changing retail environment Major
Slide 17: CEO Comments
CEO Comments Edward Sonshine, O.Ont., Q.C. Chief Executive Officer 17
Slide 18: Contact Information
Edward Sonshine, O.Ont., Q.C. Chief Executive Officer Rags Davloor President & Chief Operating Officer Qi Tang Senior Vice President & Chief Financial Officer Contact Information RioCan Yonge Eglinton Centre 2300 Yonge Street P.O. Box 2386 Toronto, ON M4P 1E4 (T) 1-800-465-2733 or (416) 866-3033
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