RioCan Invests $170M in Eight Properties

"These acquisitions represent an excellent opportunity to put to work some of the capital raised over the course of this year in a manner that is accretive to our unitholders," says Edward Sonshine, CEO of RioCan, in a statement.

"These largely grocery and drugstore anchored retail properties represent a continued execution of RioCan's growth strategy in Canada. They are primarily located in well-established urban centers with strong national and anchor tenants that will provide a stable source of cash flow as well as the potential to enhance returns through the leasing of currently vacant space."

The properties, which are 82% leased with national and anchor tenants, are located in Alberta, Ontario and Manitoba. The deal is likely to close by the end of the year or in the early part of 2010.

The properties in the transaction are primarily grocery or drugstore anchored. The 84,279-square-foot Summerwood Center is located in Sherwood Park, Alberta and is in the final stages of construction, being already 82% occupied. The 51,028-square-foot Market at Citadel Village in St. Alert, Alberta was developed in 2008 and is 91.2% occupied. The 135,802-square-foot, mixed-use Timberlea Landing in Fort McMurray Alberta is fully occupied. The property also includes 34 residential units and office space.

In Brampton, Ontario, RioCan will own the Wanless Centre. The 103,607-square-foot grocery-anchored shopping mall is 96.3% leased. Additionally, the 432,000-square-foot Chapman Mills Marketplace in Ottawa, Ontario will be added to the books. Wal-Mart anchors the facility, which RioCan is purchasing an additional 12% interest in to bring its total ownership to 75%.

RioCan is also acquiring a 30% interest in the 265,000-square-foot Garden City Shopping Centre in Winnipeg, Manitoba. The property is 93.4% leased. Additionally, RioCan will purchase a 15% stake in the 289,000-square-foot Frontenac Mall in Kingston, Ontario. The company already holds 15% ownership in the 85.3%-leased property.

And lastly, RioCan is purchasing March Road, a 22,509-square-foot retail center in Ottawa.

These acquisitions aren't the only ones RioCan is pursuing. The company also has an additional 1.4 million square feet, in six properties, under contract throughout Western Canada. Should the deals all go through, RioCan will invest another $335 million in the buys, which it plans to close on by year end.

And, as GlobeSt.com previously reported, RioCan is moving forward with its joint venture deal with Cedar Shopping Centers Inc. to acquire seven grocery-anchored properties. Two of the buys will close this year with the rest closing during Q1 2010.