Riocan Real Estate Investment Trust · TSX:REI.UN
Riocan Real Estate Investment Trust — Q2 2021 Earnings Presentation
24 slides from Riocan Real Estate Investment Trust's earnings presentation, Aug 5, 2021
Slide 1: Always Adapting, Looking Ahead: Q2 2021 Conference Call
ALWAYS ADAPTING CONFERENCE CALL LOOKING AHEAD Q2 2021 August 5, 2021
Slide 2: 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 securities statements are prepared in accordance laws including, among others, statements concerning ou
Slide 3: Business Overview
642 King St. Jonathan Gitlin, President & Chief Executive Officer Q2 2021 Conference Call | RioCan | 3 BUSINESS OVERVIEW
Slide 4: Embedding best practices in everything we do
Embedding best practices in everything we do Select Q2 2021 Achievements ESG Rating Upgrade by MSCI (1) Green Lease Leader Silver recognition Improving employee management Strong commitment to high programs and green building performance and sustainability in certificates buildings, and best practic
Slide 5: Resilient rent collection
Resilient rent collection (1) Despite COVID-19 restrictive measures 100% 0.4% 1.8% 3.2% 3.8% 5.3% 3.4% 2.4% 0.5% 0.7% 1.8% 1.5% 95% 0.2% 0.1% 90% 85% 95.7% 95.1% 94.9% 94.7% 94.5% 80% 75% Q3 2020 Q4 2020 Q1 2021 Q2 2021 July 2021 Remaining Rent To Be Collected Provision Deferred Rents Cash Collected
Slide 6: High performance growth-oriented portfolio
High performance growth-oriented portfolio Building on a strong and stable foundation Average Net Rent (PSF) $22.82 PSF ~3.0% average rent of new leases CAGR (1) signed in Q2 2021 $19.75 $19.80 $20.05 $19.07 $17.59 $17.75 2016 2017 2018 2019 2020 Q2 2021 1) Compound Annual Growth Rate Q2 2021 Confer
Slide 7: Well-positioned portfolio retains and attracts tenants
Well-positioned portfolio retains and attracts tenants 1.4 million square feet of new and renewal leases executed at robust leasing spreads 89.4% 90.9% Renewal 4.6% 4.2% Retention Leasing Ratios Spreads Q2 2020 Q2 2021 Q2 2020 Q2 2021 19.8% New Blended Leasing 9.2% Leasing 5.8% 5.4% Spreads Spreads
Slide 8: Second Quarter 2021 Results
Second Quarter 2021 Results Steadily increasing despite effects of COVID-19 FFO per Unit Same Property NOI $0.40 (1) $0.36 $0.35 Q2 2020 Q1 2021 Q2 2021 7.8% -4.6% Q2 2020 Q1 2021 Q2 2021 -10.8% 1) Excluding debenture prepayment costs Q2 2021 Conference Call | RioCan | 8
Slide 9: Positive trends in occupancy
Positive trends in occupancy Strengthens quality of income Committed and In-Place Occupancy Total Commercial Portfolio 96.4% 96.0% 96.1% 95.7% 95.8% 94.9% 95.1% 95.1% Compared to Q1 2021 committed occupancy at RioCan’s commercial properties increased by 30 bps and in-place was stable despite lockdow
Slide 10: RioCan properties attract resilient tenants
RioCan properties attract resilient tenants Improving property and tenant mix in lockstep with consumer spending patterns Property Mix* Tenant Mix* 70 bps vs. YE 2020 Enclosed 8.8% Mixed-Use/ Urban -40 bps 21.6% vs. YE Open Air 2020 Centre 27.0% Grocery Anchored Centre 42.6% 60 bps vs. YE 2020 *Perc
Slide 11: Value creation through mixed-use development
Value creation through mixed-use development Transforming RioCan through excess density on existing income producing properties Total Pipeline by Zoning Status TOTAL ZONING ENTITLEMENT 20.6M SF • ~100% located in Canada’s six major 13.7M SF (33.9%) markets(1) 39 projects • ~75% located in the GTA(1)
Slide 12: RioCan Living - high quality rental residences
RioCan Living - high quality rental residences Growing source of income diversification and NAV expansion; 1,400+ units developed since 2019 eCentral, Toronto, ON Frontier, Ottawa, ON Brio, Calgary, AB Pivot, Toronto, ON Litho, Toronto, ON • 466 unit, 36-storey • 228 unit, 23-storey • 163 unit, 12-s
Slide 13: STRADA
• 8-storey, 61 unit residential rental • ~6k sq. ft. of retail • First Occupancy targeted for Q4 2021 Toronto STRADA Q2 2021 Conference Call | RioCan | 13
Slide 14: Frontier and Latitude
• Latitude, Phase 2 ◦ 20-storey, 209 unit residential rental ◦ First Occupancy targeted for Q1 2022 • Frontier, Phase 1 – 97% leased(1) ◦ 23-storey, 228 unit residential rental 1) As of August 4, 2021 Gloucester FRONTIER AND LATITUDE Q2 2021 Conference Call | RioCan | 14
Slide 15: Condo / Townhouse development and value creation
Condo / Townhouse development and value creation Alternate source of income and cash flow providing efficient capital recycling Townhomes Condominiums Condominiums Condominiums U.C. Uptowns U.C. Tower 11 YV Queen & Ashbridge ~92% Pre-Sold Sales Sold Out Sold Out ~99% Pre-Sold (399 Units) Status (1)
Slide 16: VERGE
• First independent condo launch under RioCan Living banner in partnership with four investors • Two towers of 545 residential units • Retail at grade Toronto • Pre-sales launched in July 2021 VERGE Q2 2021 Conference Call | RioCan | 16
Slide 17: Capital recycling surfaces value
Capital recycling surfaces value Strategic dispositions offering low cost of capital for mixed-use development Dispositions Closed as of Firm & Conditional (1) Weighted Average Total (in millions) August 4, 2021 Cap Rate (2) Income Producing Properties $334.4M $324.2M $658.6M 4.8% PUD/ Residential I
Slide 18: Jonathan Gitlin, President & Chief Executive Officer
642 King St. Jonathan Gitlin, President & Chief Executive Officer Q2 2021 Conference Call | RioCan | 18
Slide 19: Financial Review
RioCan Hall Franca Smith, Interim Chief Financial Officer FINANCIAL REVIEW Q2 2021 Conference Call | RioCan | 19
Slide 20: Second Quarter 2021 Results
Second Quarter 2021 Results FFO per Unit $0.40 (1) $0.36 $0.35 Drivers of year-over-year change • Lower pandemic-related provision; • Higher residential inventory gains; • Lower interest cost, partially offset by • Forward purchase termination fee received in Q2 2020 Q2 2020 Q1 2021 Q2 2021 1) Exclu
Slide 21: Prudent approach to development
Prudent approach to development RioCan plans to primarily self fund development through retained free cash flow, divestiture proceeds, strategic partnerships and faster capital recycle from condo/townhouse development As at June 30, 2021 Target Properties Under Development (“PUD”) & Residential Inve
Slide 22: Capital Structure Metrics
Disciplined and prudent balance sheet management Ample liquidity bolstered by large pool of unencumbered assets (1) (1) Target Q1 2021 Q2 2021 Capital Structure Metrics Liquidity N/A $1.3B $1.2B Debt to Adjusted EBITDA <8.0x 10.02x (2) 9.87x (2) (3) Debt to Total Assets (3) (3) 38% - 42% 45.3% 44.7%
Slide 23: Jonathan Gitlin, President & Chief Executive Officer
642 King St. Jonathan Gitlin, President & Chief Executive Officer Q2 2021 Conference Call | RioCan | 23
Slide 24: RioCan
RIO*CAN’
RioCan Real Estate Investment Trust — Q2 2021 Earnings Presentation on 6ix