Post on 18-Jul-2020
ANNUAL GENERAL MEETING
May 29, 2018
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 IFRS.
The following measures, RioCan’s Proportionate Share (or Interest), Funds From Operations (“FFO”), Net Operating Income (“NOI”), Adjusted Earnings
before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), Debt to Adjusted EBITDA, Same Property NOI, Interest Coverage, Debt Service
Coverage, Fixed Charge Coverage, and Total Enterprise Value as well as other measures discussed in this presentation, do not have a standardized definition
prescribed by IFRS and are, therefore, unlikely to be comparable to similar measures presented by other reporting issuers.
Non-GAAP measures should not be considered as alternatives to net earnings or comparable metrics determined in accordance with IFRS as indicators of RioCan’s
performance, liquidity, cash flow, and profitability. For a full definition of these measures, please refer to the “Non-GAAP Measures” in RioCan’s Management’s
Discussion and Analysis for the period ended March 31, 2018. RioCan uses these measures to better assess the Trust’s underlying performance and provides these
additional measures so that investors may do the same.
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NON-GAAP MEASURES
FORWARD LOOKING INFORMATION
Certain information included in this presentation contains forward-looking statements within the meaning of applicable securities laws including, among others,
statements concerning our objectives, our strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates,
and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts.
Certain material factors, estimates or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in these statements and
actual results could differ materially from such conclusions, forecasts or projections.
Additional information on the material risks that could cause our actual results to differ materially from the conclusions, forecast or projections in these statements
and the material factors, estimates or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking
information can be found in our most recent annual information form and annual report that are available on our website and at www.sedar.com.
Except as required by applicable law, RioCan undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
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Paul V Godfrey
Chairman
CHAIRMANS REMARKS
VALUE PROPOSITION AND FOUR STRATEGIC PILLARS
CANADA’S MAJOR MARKET
PORTFOLIO
STRONG BALANCE
SHEET
STRATEGIC ACQUISITIONS
UNLOCKING INTRINSIC
VALUE
DRIVING ORGANIC GROWTH
$
REAL VISION, SOLID GROUND
COMMITTED AND IN-PLACE OCCUPANCY
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2016 2017 2018
96.6%96.6%96.8%96.7%96.2%
95.6%95.3%95.1%
95.7%95.6%96.0%
95.2%
94.4%
93.6%93.6%
92.9%
Q1Q4Q3Q2Q1Q4Q3Q2
Committed Occupancy In Place Occupancy
40 bps increase
130 bps increase
RIOCAN LEADERSHIP TEAM
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• Strong executive bench with a
wealth of experience and
proven track record
• Trusted and respected, with
deep industry knowledge and
relationships
Andrew Duncan
SVP Developments
18 years in
Development,
12 years in Real
Estate
Danny Kissoon
SVP Operations
32 years in Real
Estate
Ed Sonshine O.Ont.,
Q.C. Founder and
CEO
Jeff Ross,
SVP Leasing &
Tenant Construction
30 years in Real
Estate
Jennifer Suess
SVP General Counsel
& Corporate
Secretary
16 years in Law with a
focus on Real Estate
John Ballantyne,
SVP Asset
Management
24 years in Real
Estate
Jonathan Gitlin,
SVP Investments
& Residential
18 years in
Real Estate
Qi Tang,
SVP and CFO
20 years in Finance
& Real Estate
Rags Davloor
President and COO
25 years in Real
Estate, Operations
& Finance
EXPERIENCE, INTEGRITY AND FORESIGHT
INCREASED DISTRIBUTION
GROWTH IN FFO AND CONFIDENCE
IN CONTINUED GROWTH
INCREASED DISTRIBUTION BY 3 CENTS
OR 2.1% TO $1.44 PER UNIT PER YEAR
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THANK YOU TO RETIRING BOARD MEMBER
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Clare Copeland
WELCOME TO THE BOARD OF TRUSTEES
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Richard Dansereau
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Frank King
ANNUAL GENERAL MEETING
May 29, 2018
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OPENING REMARKS
Edward Sonshine O.Ont., Q.C.
Chief Executive Officer
COMMITTED OCCUPANCYCOUPLED WITH STRONG RENT GROWTH
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97.4% 97.6% 97.4% 96.9% 97.0%94.0%
95.6%96.6% 96.6%
$14.82
$15.21
$15.70
$16.08
$16.69
$17.11
$17.59$17.75
$17.93
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14
15
16
17
18
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20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
110.0%
2010 2011 2012 2013 2014 2015 2016 2017 Q1 2018
Committed Occupancy Average Net Rent
Target Departure Sears Closures
CANADA VERSUS UNITED STATES RETAIL ENVIRONMENT
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• 735 Locations
• $7.1 Billion Net Sales USD for
year ended Jan. 2017
• No accepted bids for the U.S.
operations
• 82 Locations
• $821 Million Net Sales USD for
year ended Jan. 2017
• Fairfax Financial acquired the
Canadian operations for $300
million
STRONG SAME PROPERTY NOI GROWTH
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(1.8%)
0.5%
2.1%
2.6%
2015 2016 2017 Q1 2018
Same Property NOI Growth
Target Departure
EVOLVING & RESILIENT TENANT MIX
Retailer
Category
% of
Rent Q1
2018
Change
since
2007
Key Brands
Grocery/ Pharmacy
Liquor/
Restaurant
27.8% 3.3%
Personal Services 20.3% 4.2%
Value Retailers 15.1% 2.5%
Specialty Retailers 10.1% 0.0%
Furniture and
Home10.0% 1.6%
Department Stores/
Apparel8.8% (7.5%)
Movie Theatres 4.6% (1.7%)
Entertainment and
Hobby3.3% (2.4%)
ADAPTING TO THE EVER CHANGING RETAIL ENVIRONMENT
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SAGE HILL CROSSINGCALGARY, ALBERTA
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• 372,000 square foot
development
• Completed in 2017
• Walmart opened in
2015 and Loblaws and
opened in early 2016
• Site is nearly 100%
leased
EAST HILLS CALGARY, ALBERTA
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• RioCan owns a 40%
interest in the 900,000
square foot development
• Cineplex opened in Q1
2018
• Final phase of the site is
expected to be completed
in 2021
DISPOSITION PROGRESS TO DATE
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• Sales prices to-date are in line with IFRS value
• Including conditional transactions total dispositions to date represent 40% of disposition target
Benefits Include:
• Improved portfolio quality and resilience to the changing retail environment
• Enhanced growth profile
• Newer assets and less capex
STRONG SAME PROPERTY NOI GROWTH
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• Same property NOI increased $4.3
million
• $2.7 million or 63% of the increase is
related to higher occupancy, renewal
rate growth and contractual rent
increases
• $1.5 million is due to Target backfills
and other development completions,
net of $0.7 million negative impact of
Sears closures
OVER A DECADE OF INTENSIFICATION EXPERIENCE
• Development has been an
internalized function for RioCan
since 2003
• Increased RioCan’s presence in
Canada’s six major markets
• Grown in expertise to handle
mixed-use retail and residential
development
• Added strength to handle
complex development in urban
locations
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1717 Avenue Road
Shoppes on Queen
(Queen and Portland)
INTENSIFICATION STRATEGYDEVELOPMENT PROCESS FOR EXISTING INCOME PRODUCING PROPERTY
Project Evaluation and Market Research
Leasing Strategy
Development Planning Zoning, Design, Planning
Development & Construction
Income Producing Asset Until Development Commences
Year 1 Year 2 - 3 Year 4-5 Year 6-7
SOURCES OF TREMENDOUS NAV GROWTH
• Strong, major market, urban transit
focused development pipeline
• Five to seven year head start over
our peers
• Nearly 50% or 12.2M sf with
zoning approved
ROBUST DEVELOPMENT PIPELINE
1. Includes 22.2M of incremental NLA and 4.0M of NLA which is currently income producing. All data at Riocan’s interest.
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Zoned, 12.2m sf, 46.5%
Application submitted, 5.5m sf, 21.1%
Future est. density, 8.5m sf, 32.4%
Total Pipeline by Zoning Status(26.2M* sf)
RIOCAN LIVING
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Each RioCan Living project is supported by:
• Impeccable management backed by the
proven track record of RioCan.
• Easy access to major commuter routes.
• Best in class architecture in iconic locations.
• Animated, community-focused event
programming.
• Best in class communal amenities that cater
to you.
• Retail experiences curated by the retail
experts.
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RIOCAN LIVINGNORTHEAST YONGE AND EGLINTON (eCENTRAL)
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RIOCAN LIVINGKING AND PORTLAND (KINGLY)
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RIOCAN LIVINGGLOUCESTER (FRONTIER)
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UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSBRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS
Shoppers World Brampton
RioCan Sandalwood
Square
RioCan Grand Park
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UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSBRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS
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UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSBRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS
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UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSBRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS
THE WELL
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• Excavation has
commenced for
The Well
• Confident that we
will be able to
announce the
lead tenants for
the office tower
later this year
THE WELL
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THE WELL
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CHANGES TO RIOCAN’S BOARD OF TRUSTEES
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Clare Copeland Richard Dansereau
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Q&A