RioCan Real Estate Investment Trust Announces 8% Growth in Operating Funds From Operations in the Third Quarter 2013 and

RioCan Real Estate Investment Trust Announces 8% Growth in Operating Funds From 
Operations in the Third Quarter 2013 and Provides Update
on Development Pipeline 
TORONTO, ONTARIO -- (Marketwired) -- 11/07/13 -- RioCan Real Estate
Investment Trust (TSX:REI.UN) - 
HIGHLIGHTS for the three and nine months ended September 30, 2013: 
All figures in Canadian dollars unless otherwise noted. RioCan's
results are prepared in accordance with International Financial
Reporting Standards ("IFRS").  


 
--  RioCan's Operating FFO increased by 8% to $124 million for the three
    months ended September 30, 2013 ("Third Quarter") compared to $115
    million in the third quarter of 2012. On a per unit basis, Operating FFO
    increased 3% to $0.41 per unit from $0.40 per unit in the same period of
    2012; 
--  RioCan's Operating FFO increased by 13% to $368 million for the nine
    months ended September 30, 2013 compared to $325 million for the same
    period in 2012. On a per unit basis, Operating FFO increased 8% to $1.22
    per unit from $1.13 per unit for the same period in 2012; 
--  RioCan's concentration in Canada's six major markets has increased to
    72.2% at September 30, 2013 from 67.5% at December 31, 2012; 
--  During the quarter, RioCan and its partners obtained zoning approval on
    its one million square foot development at the northeast corner of Yonge
    and Eglinton in Toronto, Ontario. The condominium portion of the
    property has proven extremely successful with approximately 90% of the
    623 condominium units by dollar value having been pre-sold. Development
    is expected to commence in 2014. 
--  RioCan has begun construction at its Calgary, Alberta development, Sage
    Hill. This 386,000 square foot new format retail centre is approximately
    72% leased and is expected to be completed in 2016; 
--  RioCan has filed an application for zoning and site plan for Yonge
    Sheppard Centre to add 110,000 square feet of retail space and 290,000
    square feet of residential density; 
--  Overall occupancy was 97.0% at September 30, 2013, compared to 96.7% at
    June 30, 2013; 
--  RioCan renewed 708,000 square feet in the Canadian portfolio during the
    Third Quarter at an average rent increase of $2.08 per square foot,
    representin
g an increase of 11.2%, compared to 12.9% for the same period
    in 2012. The renewal retention rate in Canada for the quarter was 91.1%;
--  RioCan renewed 2.5 million square feet in the Canadian portfolio during
    the nine months ended September 30, 2013 at an average rent increase of
    $2.05 per square foot, representing an increase of 12.1%, compared to
    12.0% for the same period in 2012; 
--  During the Third Quarter, RioCan acquired interests in seven income
    properties in Canada and the US aggregating to 409,000 square feet at an
    aggregate purchase price of approximately $97 million at RioCan's
    interest at a weighted average capitalization rate of 5.9%. Year to
    date, RioCan has acquired interests in 29 income properties in Canada
    and the US aggregating to 2.8 million square feet at a total purchase
    price of approximately $783 million at a weighted average capitalization
    rate of 5.6%; 
--  During the three months ended September 30, 2013, RioCan completed
    dispositions of three income properties aggregating $16 million that
    comprised of approximately 311,000 square feet. Year to date, RioCan has
    completed dispositions of ten income properties aggregating $401
    million, comprised of approximately 2.1 million square feet; 
--  Subsequent to the quarter end, RioCan effectively dissolved its joint
    venture arrangements with Retail Properties of America, Inc. ("RPAI")
    and Dunhill Partners ("Dunhill"). RioCan currently has entered into an
    agreement with Sterling Corporation ("Sterling") to acquire their
    interest in two Texas properties and dissolve the joint venture
    arrangement; and 
--  RioCan's operating platform in the United States is now fully staffed
    and operational. RioCan has consolidated its ownership of virtually all
    of the US properties that were previously owned through joint venture
    arrangements. Working from two regional offices located in Mount Laurel,
    New Jersey and Dallas, Texas and supported by RioCan's headquarters in
    Toronto, Ontario, Canada, RioCan's 26 full time employees in the United
    States will manage RioCan's US portfolio. 

 
RioCan Real Estate Investment Trust ("RioCan") today announced its
financial results for the three and nine months ended September 30,
2013. 
"I am pleased with our results in the third quarter. RioCan has been
able to generate positive FFO growth versus last year without the
benefit of a large lease termination fee that we received in the same
quarter last year. We expect to see continued results from all of our
growth drivers and particularly from RioCan's development portfolio.
Our soon to commence development projects at the northeast corner of
Yonge and Eglinton and Yonge and Sheppard in Toronto, Ontario as well
as our Sage Hill development in Calgary, Alberta are all progressing
as expected. We will start seeing completions of our development
properties in 2014 with the opening of Stockyards in Toronto and then
we expect to see a steady stream of finished developments over the
next few years," said Edward Sonshine, Chief Executive Officer of
RioCan. "We have recently assumed property management functions in
Texas and now fully control virtually all of our US property
portfolio. Our now established US platform will be a key component to
RioCan's organic growth. We expect to see continued growth in our
Operating Funds From Operations from higher same store income in
RioCan's Canadian and US portfolio, an expanding development
portfolio, which will contribute to RioCan's medium and long term
growth, along with growth from opportunistic acquisitions." 
Financial Highlights 
In millions except percentages and per unit values 


 
----------------------------------------------------------------------------
                                Three months ended        Nine months ended 
                                     September 30,            September 30, 
----------------------------------------------------------------------------
                             2013   2012  % change    2013   2012  % change 
----------------------------------------------------------------------------
Operating FFO              $  124 $  115         8% $  368 $  325        13%
----------------------------------------------------------------------------
Operating FFO per Unit     $ 0.41 $ 0.40         3% $ 1.22 $ 1.13         8%
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
                                      Three months ended   Nine months ended
In $millions                               September 30,       September 30,
----------------------------------------------------------------------------
                                          2013      2012      2013      2012
----------------------------------------------------------------------------
Net earnings attributable to common                                         
 and preferred unit holders          $     129 $     125 $     445 $     876
----------------------------------------------------------------------------
Ne
t earnings before taxes and fair                                          
 value adjustment                    $     125 $     121 $     364 $     344
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
In $millions. As at                             September 30,  September 30,
                                                         2013           2012
----------------------------------------------------------------------------
Total enterprise value (1)                             13,624         13,823
----------------------------------------------------------------------------
Total assets - at RioCan's interest (1)                13,353         12,073
----------------------------------------------------------------------------
Debt (mortgages and debentures payable - at                                 
 RioCan's interest) (1)                                 5,991          5,277
----------------------------------------------------------------------------
(1)  Based on RioCan's proportionate share including joint ventures         
     accounted for under the equity method of accounting.                   

 
Operating FFO for the Third Quarter was $124 million ($0.41 per unit)
compared to $115 million ($0.40 per unit) in the Third Quarter of
2012. The primary reasons for this increase were: a $9 million
increase in net operating income ("NOI"), which was due to
acquisitions net of dispositions, same property growth of 1.9% in
Canada and 0.9% in the US, the completion of greenfield developments,
partly offset by lower lease cancellation fees. Interest expense,
general and administrative costs and other expenses remained
relatively flat on a year over year basis for the third quarter. 
Operating FFO for the nine months ended September 30, 2013 was $368
million ($1.22 per unit) compared to $325 million ($1.13 per unit) in
2012. The primary reasons for this increase were: a $45 million
increase in net operating income ("NOI"), which was due to
acquisitions net of dispositions same property growth of 0.8% in
Canada and 0.9% in the US, and the completion of greenfield
developments, partly offset by lower lease cancellation fees.
Operating FFO also benefited from higher fees and other income of $3
million during the first nine months of 2013. These increases to
Operating FFO were partially offset by increased interest expense of
$1 million and higher general and administrative expenses of $4
million due to higher unit-based compensation, an increased
investment in the Trust's operational infrastructure and a favourable
sales tax recovery in 2012.  
Same Store and Same Property NOI 


 
----------------------------------------------------------------------------
Canada                Three months ended          Nine ended     Sequential 
                      September 30, 2013  September 30, 2013   Quarter over 
                          Year over Year      Year over Year        Quarter 
----------------------------------------------------------------------------
Same Store Growth                    2.2%                1.0%           1.1%
----------------------------------------------------------------------------
Same Property Growth                 1.9%                0.8%           1.1%
----------------------------------------------------------------------------
United States                                                               
----------------------------------------------------------------------------
Same Store & Property                                                       
 Growth                              0.9%                0.9%           0.4%
----------------------------------------------------------------------------

 
Overview of Development Activities 
As at September 30, 2013, RioCan had ownership interests in 15
properties under development that will, upon completion, comprise
about 10.4 million square feet (4.8 million square feet at RioCan's
interest). In addition to its development projects, RioCan continues
its urban intensification activities, primarily in the Toronto,
Ontario market. RioCan's Development and intensification pipeline is
expected to be a significant contributor to RioCan's continued medium
and long term growth. At September 30, 2013, RioCan's total
forecasted development spend, before any construction financing, for
greenfield development, urban developments, and its expansion and
redevelopment pipeline is $0.8 to $1 billion over the next five to
seven years. 
Three high profile developments in particular are expected to provide
material growth as well as the potential to add an additional
property type by way of a rental multi-family component in two of the
assets. The three highlighted projects below showcase the wide range
of RioCan's development and redevelopment expertise. The northeast
corner of Yonge and Eglinton is a prime example of RioCan's ability
to successfully develop large scale urban and mixed use properties.
Yonge Sheppard Centre is an excellent example of RioCan's urban
redevelopment capability. Finally, Sage Hill in Calgary, Alberta is a
prime example of RioCan's ability to develop traditional new format
retail centres in a core market for RioCan. 
Yonge & Eglinton Northeast Corner 
Situated on the northeast corner at the intersection of Yonge Street
and Eglinton Avenue in Toronto, Ontario, directly across the street
from RioCan's headquarters at RioCan Yonge Eglinton Centre, this 1.1
acre site has been approved for redevelopment by the city of Toronto
with a 58 storey tower at the corner and a 36 storey tower fronting
Roehampton Avenue, which is the first street north of Eglinton
Avenue. RioCan expects to begin demolition and construction on this
project in 2014. When complete, this development will include 54,000
square feet of retail and office space on the first three floors.
RioCan has agreed to purchase its partners' interests in the retail
and office component of the property. The development is being
undertaken by RioCan with its partners, Metropia and Bazis Inc. The
condominium portion of the property has proven extremely successful
with approximately 90% of the 623 condominium units having been
pre-sold (as measured by dollar value). 
As part of the project RioCan and its partners have decided to
develop the north tower of this centre as multi-family residential.
Based on preliminary designs, when complete, the north tower will
consist of a 208 unit rental residential apartment building, which
will provide a stable and growing source of cashflow for RioCan.  
The retail component of the centre will primarily consist of a
landmark branch of the Toronto-Dominion Bank.  
When complete, this development in the heart of uptown Toronto will
provide direct access to the Yonge Street subway and Eglinton transit
lines, will have underground access to the RioCan Yonge Eglinton
Centre, and will include 332 parking spaces. RioCan will control two
of the corners in this very high traffic and densely developed
neighbourhood within the city, with a combined two million square
feet of retail, residential and office space.  
Yonge Sheppard Centre 
Located approximately six kilometres north of RioCan Yonge Egli
nton
Centre at the northeast corner of one of Toronto's busiest
intersections and situated on both the Yonge and Sheppard subway
lines, this 6.2 acre site is currently comprised of a 680,000 square
foot mixed use property containing 262,000 square feet of retail,
416,000 square feet of office space and 25 rental townhomes. RioCan
and its partner KingSett Capital have recently submitted an
application in order to add an additional 110,000 square feet of
retail space and 290,000 square feet of multi-family residential
density to the site. The completed expansion and renovation of the
existing space will involve three significant elements and will
greatly increase the profile of this mixed use urban property.  
The existing retail mall at Yonge Sheppard Centre will be
substantially renovated, upgraded and expanded. An addition to and
renovation of the former cinema fronting Yonge Street will be
completed and a new four-storey retail building fronting Sheppard
Avenue will be connected to the existing mall along with the addition
of new retail space in the below-grade pedestrian walkways. When
complete, these renovations and additions to the retail space will
add approximately 110,000 square feet of new retail space. RioCan
currently has conditional agreements in place with Longo's
Supermarket and LA Fitness to lease all of the space in the former
cinema. Due to the substantial interest from many retailers, RioCan
expects the retail space to be fully leased prior to completion. 
The proposed plans also contemplate the addition of a new rental
residential tower on Greenfield Avenue. When complete the additional
residential tower would include a 39 storey tower containing 290,000
square feet of residential space. These units will benefit from the
convenience of direct access to the retail portion of the property as
well as both the Yonge and Sheppard subway lines. 
Redevelopment on the retail portion of the property is expected to
commence in late 2014. When complete in or about 2016, this high
profile mixed use property will be a fixture in one of the most
densely populated neighbourhoods in Toronto.  
Sage Hill 
This 34-acre site is currently being developed into a 386,000 square
foot new format retail centre as a joint venture with KingSett
Capital. The property was acquired in the first quarter of 2013, site
servicing work will commence in fall 2013, and building construction
is expected to commence in spring 2014 with completion expected in
2016. The site will be anchored by a Walmart Superstore and a Loblaws
Foodstore. Walmart is anticipating opening in the early part of 2015
with Loblaws scheduled to open later that same year. Other major
tenants at the property will include Royal Bank of Canada,
Scotiabank, McDonalds, Liquor Depot and London Drugs. As at September
30, 2013 the property was 72% preleased, and with many tenancies
currently under negotiation, RioCan expects the centre will be
substantially fully leased prior to completion. 
The site is the only designated major retail development site
remaining in Northwest Calgary and as such, provides significant
opportunity for retailers to locate at the core of what will be a
thriving residential community. The surrounding North Sector area has
an existing population of almost 30,000 persons and 10,600 housing
units. The North Sector is expected to have a population in excess of
85,000 persons and 29,000 housing units within several years. This
anticipated residential growth rate is consistent with the overall
population growth forecasted for the Calgary Economic Region where it
is expected to increase by an additional 135,000 people (10.1%) to
1.5 million persons by 2016. 
The three development projects described above are just a few
examples of RioCan's growing development portfolio. Currently,
RioCan's other development projects are progressing as planned.
RioCan expects The Stockyards development in Toronto will be
completed, as scheduled, in spring 2014.  
RioCan is in the process of discussions with community and other
stakeholders as it completes plans for the 7.7 acre parcel that it
has assembled at the corner of Front Street and Spadina Avenue in
Toronto, Ontario with its partners Allied Properties and Diamond
Corporation. RioCan expects that the master plan application for
rezoning for the site with the city of Toronto will be submitted in
early 2014.  
RioCan's development projects with Tanger are also progressing as
expected at Kanata and Cookstown, with both properties expected to be
completed in late 2014 and to open substantially fully leased prior
to completion. 
Development acquisitions completed during the Third Quarter 
RioCan did not acquire any development properties during the Third
Quarter. 
Development Property Acquisitions under Contract  
RioCan currently has the following two development sites in Canada
under firm contract where conditions have been waived that, if
completed, represent acquisitions of $20 million at RioCan's
interest. 


 
--  The acquisition of lands adjacent to Calaway Park, a 35 acre parcel of
    land located approximately 25 kilometers west of Calgary, Alberta. The
    site is to be acquired on a 50/50 joint venture basis between RioCan and
    Tanger at a purchase price of $28 million ($14 million at RioCan's
    interest). The site would be acquired free and clear of financing and
    RioCan would acquire a managing interest in the development property.
    The site represents an opportunity for the RioCan/Tanger joint venture
    to enter the Calgary market with the intention to develop the land into
    an outlet centre of approximately 350,000 square feet. The acquisition
    of the land, which is subject to certain conditions, is expected to
    close in the second quarter of 2014. 
 
--  The acquisition of a 50% interest in the site where TD Bank is currently
    located at the northeast corner of Yonge Street and Eglinton Avenue in
    Toronto, Ontario, at a purchase price of $12 million ($6 million at
    RioCan's interest). The acquisition is expected to close in the second
    quarter of 2014 and will form part of the existing North East Yonge
    Eglinton land assembly, acquired in 2011 with Metropia and Bazis Inc.
    During the quarter, RioCan and its partners obtained zoning approval and
    the redevelopment is slated to commence in 2014 to convert the site into
    a mixed-use retail and residential property. 

 
Additionally, RioCan has $6 million of development sites in Canada
(at RioCan's interest) under contract where conditions have not yet
been waived. These transactions are in various stages of due
diligence and while efforts will be made to complete these
transactions, no assurance can be given. 
Leasing and Operational Highlights: 
Various operating and leasing metrics over the last eight quarters
are as follows: 


 
                    2013                        2012                  2011  
          ------------------------------------------------------------------
(thousands                                                                  
 of square                                                                  
 feet,                                                                      
 millions                                                                   
 of         Third  Second   First  Fourth   Third   Second   First   Fourth 
 dollars) quarter quarter quarter quarter quarter  quarter quarter  quarter 
----------------------------------------------------------------------------
Committed                                                                   
 occupancy   97.0%   96.7%   97.0%   97.4%   97.3%    97.4%   96.9%    97.6%
Economic                                                                    
 occupancy   95.5%   95.4%   95.8%   95.9%   95.5%    95.5%   95.7%    96.6%
NLA leased                                                                  
 but not                                                                    
 paying    
                                                                 
 rent         716     642     615     711     855      871     542      466 
Annualized                                                                  
 rental                                                                     
 impact    $17.00  $15.00  $15.00  $15.00  $18.00   $18.00  $12.00   $11.00 
Retention                                                                   
 rate -                                                                     
 Canada                                                                     
 (i)         91.1%   95.9%   68.3%   94.3%   84.8%    89.9%   91.2%    90.5%
% increase                                                                  
 in                                                                         
 average                                                                    
 net rent                                                                   
 per sq ft                                                                  
 - Canada    11.2%   12.0%   13.4%   18.4%   12.9%    13.4%   10.0%    14.5%
Retention                                                                   
 rate - US   98.4%   92.0%   98.8%   87.6%   96.3%    84.2%   83.1%    95.7%
% increase                                                                  
 in                                                                         
 average                                                                    
 net rent                                                                   
 per sq ft                                                                  
 - US         3.8%    4.3%    2.3%    5.1%    6.0%     7.3%    7.2%     8.9%
Average in                                                                  
 place                                                                      
 rent      $16.07  $15.77  $15.77  $15.70  $15.85   $15.33  $15.37   $15.14 
Same store                                                                  
 growth                                                                     
 (ii) -                                                                     
 Canada       2.2%    0.6%    0.1%    0.2%    0.0%     1.5%    1.5%     1.9%
Same store                                                                  
 growth                                                                     
 (ii) - US    0.9%    1.4%    1.4%    1.9%   (0.3%)    1.3%   (0.6%)    1.3%
----------------------------------------------------------------------------
(i) - The first quarter of 2013 includes impact of the vacancy of Zellers   
totalling 188,000 sq ft at 100% (100,500 sq ft at RioCan's interest) during 
the quarter. The first quarter of 2013 retention rate excluding Zellers was 
81.1%.                                                                      
(ii) - Refers to the growth in same store on a year over year basis         

 
Highlights: 


 
--  RioCan's Canadian portfolio is concentrated in Canada's six high growth
    markets (consisting of Calgary, Edmonton, Montreal, Ottawa, Toronto and
    Vancouver). Assets in these markets contribute about 72.2% of RioCan's
    Canadian annualized rental revenue (67.5% at December 31, 2012). The
    increase during the year was accomplished through a combination of the
    sale of certain assets in secondary markets and the acquisition of two
    large enclosed shopping centres in the Greater Toronto Area; 
 
--  National and anchor tenants represented about 86.2% of RioCan's total
    annualized rental revenue at September 30, 2013, a slight increase
    compared to 85.9% at September 30, 2012; and 
 
--  No individual tenant comprised more than 3.8% of annualized rental
    revenue. At September 30, 2013, Walmart was RioCan's largest revenue
    source. Loblaws announced it had entered into an agreement to purchase
    Shoppers Drug Mart earlier this year, and upon closing of this
    transaction which is scheduled for the first quarter of 2014, Loblaws
    would become RioCan's largest tenant as measured by gross revenue. 

 
Portfolio Activity and Acquisition Pipeline 
During the Third Quarter, RioCan completed seven acquisitions of
interests in income producing properties in Canada and the United
States totalling $97 million with a weighted average capitalization
rate of 5.9%. Included in the seven acquisitions are three properties
in Texas (Timber Creek in Dallas, Arbor Park in San Antonio, and Las
Colinas in Dallas), which were part of the Dunhill dissolution as
described below in Joint Venture Activities.  
RioCan has five income properties under firm contract that, if
completed, will represent acquisitions of $130 million at RioCan's
interest with a weighted average capitalization rate of 5.9%.
Conditions have been waived and it is expected that these
transactions will close over the next two quarters.  
Acquisitions Completed in the Third Quarter 
Canada  


 
--  On August 1, 2013, RioCan acquired an additional 20% interest from
    partner Trinity in Colossus Centre in Vaughan, Ontario, bringing
    RioCan's ownership interest in the property to 100%. The additional 20%
    interest was acquired for a purchase price of $40 million, at a
    capitalization rate of 5.5%. Located northwest of the Highway 400 and
    Highway 407 interchange in Vaughan, Ontario, RioCan Colossus Centre is
    an unenclosed new format retail centre with approximately 713,000 square
    feet of leasable area. The site is anchored by a 101,000 square foot
    Famous Players (Cineplex) theatre and a 130,000 square foot Costco,
    which owns its own premises. The remainder of the centre is occupied by
    national tenants that include Marshalls (Winners), HomeSense (Winners),
    Roots, Golf Town, PetSmart, Bank of Montreal, La Vie En Rose, Alice
    Fazooli's and Jack Astor's. In connection with the acquisition, RioCan
    assumed Trinity's share of the existing mortgages totaling $20 million,
    which carries an interest rate of 5.3%. 

 
United States 


 
--  On July 15, 2013 First Colony Shopping Center a 98,186 square foot
    grocery anchored shopping centre located in California, Maryland. It is
    anchored by a Giant Supermarket and also includes tenants such as
    Michael's and Pier One and is shadow anchored by Target and Lowe's. The
    property was acquired at a purchase price of US$20 million which equates
    to a capitalization rate of 6.3%. The property was acquired free and
    clear of financing. 
--  On August 13, 2013, RioCan acquired a 100% interest in a 2,675 square
    foot pad at Alamo Ranch in San Antonio, Texas. The purchase price for
    the pad, which is tenanted by Del Taco, was US$2 million, equating to a
    capitalization rate of 6.0%. The pad was acquired free and clear of
    financing. In 2011, RioCan acquired an 80% interest in Alamo Ranch,
    which was later increased to a 100% interest as part of the RPAI
    dissolution on October 1, 2013. Alamo Ranch is a 789,896 super-regional
    shopping centre anchored by SuperTarget (shadow), Lowe's (shadow),
    JCPenney (shadow), Ross Dress for Less, Marshalls, PetSmart, Best Buy,
    Dick's Sporting Goods, Office Max, Michaels, Ulta, and Books-A-Million.
    Alamo Ranch is the dominant shopping centre in west San Antonio due to
    its strong location, tenant line up, retailer synergy and a convenient
    shopping experience for the rapidly expanding, affluent residential
    area. 
--  On August 27, 2013, RioCan acquired a 100% interest in a 60,835 square
    foot single-tenant building at Great Southwest Crossing in Grand
    Prairie, Texas. The purchase price for the building, which is tenanted
    by Kroger Supermarket, was US$6 million, equating to a capitalization
    rate of 6.8%. The building was acquired free and clear of financing. In
    2010, RioCan acquired an 80% interest in Great Southwest Crossing, which
    was later increased to a 100% interest as part 
of the RPAI dissolution
    on October 1, 2013. Great Southwest Crossing is a 283,173 square foot
    shopping centre anchored by Office Depot and PetSmart and shadow-
    anchored by Sam's Club. 

 
Acquisitions Under Contract (Firm) 
RioCan currently has two income properties in Canada and three in the
United States where conditions have been waived as follows:  
Canada 


 
--  1860 Bayview Avenue is a development site located at the northwest
    corner of Bayview Avenue and Broadway Avenue in the Leaside area of
    Toronto. KingSett and Trinity Development Group are currently developing
    a grocery-anchored centre on the site, and RioCan will acquire the site
    on a forward purchase basis at an approximate purchase price of $58
    million, at a capitalization rate of 5.4%. Once completed, the centre
    will consist of approximately 83,084 square feet of retail space and
    will be anchored by a second floor 52,420 square foot Whole Foods with
    primarily national tenants on the ground floor, the majority of which is
    pre-leased. The initial acquisition of the land is expected to close
    during the fourth quarter of 2013, with the remaining portions related
    to the building to be paid on an earn-out basis upon completion of the
    project, which is expected to take place in 2015. 
--  The acquisition of a 100% interest in Eagles Landing, located in
    Vaughan, Ontario, for a purchase price of $56 million, which equates to
    a capitalization rate of 6.2%. Eagles Landing is a 177,031 square foot
    grocery anchored shopping centre anchored by Yummy Market, with other
    tenants such as The Beer Store, TD Bank and Starbucks. The property will
    be acquired free and clear of financing and the acquisition is expected
    to close in the fourth quarter of 2013. 

 
United States 


 
--  The acquisition of an additional 10% interest in Ingram Hills Shopping
    Centre from partner Sterling, bringing RioCan's ownership interest in
    the property to 100%. The purchase price for the additional 10% interest
    is US$1 million, at a capitalization rate of 7.8%. Ingram Hills Shopping
    Centre is an 80,397 square foot infill grocery anchored neighborhood
    retail centre located in San Antonio, Texas. The property is anchored by
    a 43,279 square foot La Fiesta which is a high volume Hispanic grocer.
    Other notable tenants include Dollar General, Little Caesars and Chase
    Bank. In connection with the acquisition, RioCan will assume Sterling's
    share of the mortgage financing in the amount of US$0.4 million, bearing
    interest at 6.1% and maturing in August 2017. The acquisition is
    expected to close in the fourth quarter of 2013. 
 
--  The acquisition of an additional 20% interest in Cinco Ranch from
    partner Sterling, bringing RioCan's ownership interest in the property
    to 100%. The purchase price for the additional 20% interest is US$5
    million, at a capitalization rate of 6.0%. Cinco Ranch is a 271,761
    square foot retail power centre. In addition to the strong junior anchor
    tenant presence provided by HomeGoods, Michaels and OfficeMax, the
    property sits on both sides of an approximately 174,000 square foot
    Super Target which owns its own parcel. Other tenants include national
    and regional retailers such as Mattress Giant, RadioShack and Supercuts.
    In connection with the acquisition, RioCan will assume Sterling's share
    of the mortgage financing in the amount of US$2 million, bearing
    interest at 7.3% and maturing in May 2019. The acquisition is expected
    to close in the fourth quarter of 2013. 
 
--  The acquisition of a 100% interest in a 64,329 square foot single-tenant
    building at Riverpark Shopping Centre in Sugar Land (Houston), Texas.
    The purchase price for the building, which is tenanted by Gander
    Mountain, is US$9 million, equating to a capitalization rate of 8.0%.
    The building will be acquired free and clear of financing. The
    acquisition is expected to close in the first half of 2014. In 2010,
    RioCan acquired an 80% interest in Riverpark Shopping Centre, which was
    later increased to a 100% interest as part of the RPAI dissolution on
    October 1, 2013. Riverpark Shopping Centre is a 375,599 square foot new
    format retail centre divided into two phases. Phase I is anchored by an
    80,400 square foot HEB Grocery while Phase II is anchored by a 38,000
    square foot LA Fitness and a 15,000 square foot Dollar Tree. There is
    also a healthy mix of national tenants to complement the anchors
    including Walgreens, Bank of America and Starbucks. 

 
Joint Venture Activities 
As previously announced on October 10, 2013, RioCan has successfully
completed the dissolution of its joint venture arrangements with its
Texas partners, RPAI and Dunhill. In total, RioCan acquired its
partners' interests in 14 properties from RPAI and Dunhill at a
purchase price of US$180 million at a weighted average capitalization
rate of 6.7%. Separately, RioCan acquired the remaining interest in
Las Palmas Marketplace in October 2013 from Kimco at a purchase price
of US$32 million, which was owned jointly by Kimco, Dunhill and
RioCan. Including the acquisition from Kimco, the total paid to
acquire full ownership of the 14 properties was US$212 million at a
weighted average capitalization rate of 6.6%. RioCan also entered
into an agreement to dissolve its joint venture arrangement with
Sterling by agreeing to purchase their managing interest in two
properties in Texas, for a total purchase price of US$6.2 million. 
RioCan has completed two additional acquisitions, the Kroger grocery
store parcel at Great Southwest Crossing at a purchase price of
US$6.3 million at a capitalization rate of 6.8% and Beekman Stop &
Shop, Hopewell Junction, New York at a purchase price of US$15
million at a capitalization rate of 6.2%.  
In addition, RioCan has entered into a firm contract to purchase the
Gander Mountain parcel which is part of Riverpark Shopping Center in
Houston, Texas at a purchase price of US$9 million.  
Disposition Pipeline 
As a further means of raising and re-cycling capital, the Trust
intends to selectively sell assets as part of a process of actively
managing the portfolio and a means of increasing the portfolio
weighting to the urban markets in Canada. RioCan had dispositions of
$16 million during the quarter and dispositions of $390 million
during the nine months ended September 30, 2013. Subsequent to the
quarter end, RioCan completed the disposition of two properties at a
total sale price of $11 million. RioCan has one property disposition
in Canada under firm contract where conditions have been waived
pursuant to purchase and sale agreements at a sales price of $21 
million. Additionally, RioCan has two property dispositions under
conditional contract where conditions have not yet been waived
pursuant to purchase and sale agreements at an aggregate sales price
of $194 million. There is $92 million of mortgage financing
associated with the properties, which have a gross leasable area of
approximately 630,000 square feet. These transactions are in various
stages of due diligence and while efforts will be made to complete
these transactions, no assurance can be given. Included in
conditional dispositions is the disposition of RioCan's 50% managing
interest in a property located in Quebec at a sales price of $193
million. The purchasing parties are comprised of the existing owners
of the remaining 50% interest. Should the purchasers fail to waive
due diligence conditions, or fail to close the transaction, RioCan
shall have the right to acquire the purchasers' 50% interest on the
same terms and conditions. As the transaction is conditional with
respect to either the prospective disposition or acquisition, there
are no assurances that it will be completed. RioCan is also in the
process of marketing for sale two other Canadian properties with a
gross leaseable area of 329,000 square feet. 
The fair value of the
properties as at September 30, 2013 calculated in accordance with
IFRS is approximately $64 million and there is $7 million of mortgage
financing associated with the properties.  
Liquidity and Capital 


 
----------------------------------------------------------------------------
                                In millions except percentages and per unit 
                                                   values                   
----------------------------------------------------------------------------
                                 Quarter ended      Rolling 12 months ended 
----------------------------------------------------------------------------
                                 September 30,  September 30,  December 31, 
                                          2013           2013          2012 
----------------------------------------------------------------------------
Interest Coverage - RioCan's                                                
 interest                                3.13x          2.83x         2.69x 
----------------------------------------------------------------------------
Debt Service Coverage - RioCan's                                            
 interest                                2.27x          2.09x         1.98x 
----------------------------------------------------------------------------
Fixed Charge Coverage - RioCan's                                            
 interest                                1.10x          1.07x         1.04x 
----------------------------------------------------------------------------
Net debt to adjusted EBITDA -                                               
 RioCan's interest                       7.87x          7.58x         7.29x 
----------------------------------------------------------------------------
Net operating debt to adjusted                                              
 operating EBITDA - RioCan's                                                
 interest                                7.51x          7.32x         7.09x 
----------------------------------------------------------------------------
Unencumbered assets              $       2,018                $       1,353 
----------------------------------------------------------------------------
Unencumbered assets to unsecured                                            
 debt                                      139%                         104%
----------------------------------------------------------------------------

 
Financing Highlights for the Third Quarter 
Canada 


 
--  RioCan has four revolving lines of credit in place with three Canadian
    chartered banks, having an aggregate capacity of $429 million. At
    September 30, 2013, $180 million has been drawn against these facilities
    and $27 million has been drawn as letters of credit, leaving $222
    million available for cash draws under the lines of credit. 
--  Subsequent to the quarter end, RioCan increased one of its credit
    facilities by $60 million and is currently in negotiations to increase
    another existing operating facility to provide additional flexibility.
    The additional facilities are expected to be available to RioCan in the
    fourth quarter of 2013. 
--  As at September 30, 2013, RioCan's unencumbered asset pool was comprised
    of 106 assets with an aggregate fair value of $2 billion. 

 
Trust Units 
On July 25, 2013, RioCan announced the TSX approval of its notice of
intention to make a normal course issuer bid ("NCIB") for a portion
of its Units as appropriate opportunities arise from time to time.
RioCan's NCIB will be made in accordance with the requirements of the
TSX. Under the NCIB, RioCan may acquire up to a maximum of 15,039,156
of its Units, or approximately 5% of its issued and outstanding Units
as of July 9, 2013, for cancellation over the next 12 months
commencing on or about August 3, 2013 until August 4, 2014 (as such
other time as RioCan completes its purchases or provides notice of
termination of such bid). RioCan intends to fund the purchases out of
its available cash and undrawn credit facilities. 
During the quarter RioCan acquired and cancelled 917,700 units at an
average price per unit of $24.04 through the NCIB program. 
RioCan's Consolidated Financial Statements, Management's Discussion
and Analysis and a Supplemental Information Package for the three
months ended September 30, 2013 are available on RioCan's website at
www.riocan.com. 
Conference Call and Webcast 
Interested parties are invited to participate in a conference call
with management on Thursday, November 7, 2013 at 9:00 a.m. eastern
time. You will be required to identify yourself and the organization
on whose behalf you are participating.  
In order to participate, please dial 416-340-2218 or 1-866-226-1793.
If you cannot participate in the live mode, a replay will be
available until December 5, 2013. To access the replay, please dial
905-694-9451 or 1-800-408-3053 and enter passcode 7545823#. 
Scheduled speakers include Edward Sonshine, O.Ont. Q.C., Chief
Executive Officer, Fred Waks, President and Chief Operating Officer
and Rags Davloor, Executive Vice President and Chief Financial
Officer. Management's presentation will be followed by a question and
answer period. To ask a question, press "star 1" on a touch-tone
phone. The conference call operator will be notified of all requests
in the order in which they are made, and will introduce each
questioner.  
Alternatively, to access the simultaneous webcast, go to the
following link on RioCan's website http://investor.riocan.com/Investo
r-Relations/Events-Webcasts/default.aspxand click on the link for the webcast. 
The webcast will be archived
24 hours after the end of the conference call and can be accessed for
120 days.  
About RioCan 
RioCan is Canada's largest real estate investment trust with a total
capitalization of approximately $13.6 billion as at September 30,
2013. It owns and manages Canada's largest portfolio of shopping
centres with ownership interests in a portfolio of 346 retail
properties containing more than 83 million square feet, including 51
grocery anchored and new format retail centres containing 14 million
square feet in the United States as at September 30, 2013. RioCan's
portfolio also includes 15 properties under development in Canada.
For further information, please refer to RioCan's website at
www.riocan.com. 
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 IFRS. The following measures, Funds From Operations
("FFO"), Operating Funds From Operations ("Operating FFO"), and
Adjusted Earnings before interest, taxes, depreciation and
amortization ("Adjusted EBITDA") as well as other measures discussed
elsewhere in this release, do not have a standardized definition
prescribed by IFRS and are, therefore, unlikely to be comparable to
similar measures presented by other reporting issuers. RioCan uses
these measures to better assess the Trust's underlying performance
and provides these additional measures so that investors may do the
same. 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 "Use of Non-GAAP Measures" in RioCan's Management's Discussion
and Analysis for the period ended September 30, 2013. 
Forward-Looking Information 
This news release contains forward-looking statements within the
meaning of applicable securities laws. These statements include, but
are not limited to, statements made in this News Release (including
the sections entitled "Highlights for the three and nine mon
ths ended
September 30, 2013", "Financial Highlights","Overview of Development
Activities" "Leasing and Operational Highlights", "Portfolio Activity
and Acquisition Pipeline", and "Liquidity and Capital"), and other
statements concerning RioCan's objectives, its 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.
Forward-looking statements generally can be identified by the use of
forward-looking terminology such as "outlook", "objective", "may",
"will", "would", "expect", "intend", "estimate", "anticipate",
"believe", "should", "plan", "continue", or similar expressions
suggesting future outcomes or events. Such forward-looking statements
reflect management's current beliefs and are based on information
currently available to management. All forward-looking statements in
this News Release are qualified by these cautionary statements.  
These forward-looking statements are not guarantees of future events
or performance and, by their nature, are based on RioCan's current
estimates and assumptions, which are subject to risks and
uncertainties, including those described under "Risks and
Uncertainties" in RioCan's Management's Discussion and Analysis for
the period ended September 30, 2013 and in RioCan's annual
information form dated March 28, 2013, which could cause actual
events or results to differ materially from the forward-looking
statements contained in this News Release. Those risks and
uncertainties include, but are not limited to, those related to:
liquidity and general market conditions, tenant concentrations,
occupancy levels and defaults, access to debt and equity capital,
interest rates, joint ventures/partnerships, the relative illiquidity
of real property, unexpected costs or liabilities related to
acquisitions, construction, environmental matters, legal matters,
reliance on key personnel, unitholder liability, income taxes, United
States of America ("US") investment and currency risk, and RioCan's
qualification as a real estate investment trust for tax purposes.
Material factors or assumptions that were applied in drawing a
conclusion or making an estimate set out in the forward-looking
information may include, but are not limited to: a stable retail
environment; relatively low and stable interest costs; a continuing
trend toward land use intensification in high growth markets; access
to equity and debt capital markets to fund, at acceptable costs, the
future growth program to enable the Trust to refinance debts as they
mature; the availability of purchase opportunities for growth in
Canada and the US. Although the forward-looking information contained
in this News Release is based upon what management believes are
reasonable assumptions, there can be no assurance that actual results
will be consistent with these forward-looking statements. Certain
statements included in this News Release may be considered "financial
outlook" for purposes of applicable securities laws, and such
financial outlook may not be appropriate for purposes other than this
News Release.  
The Income Tax Act (Canada) contains provisions which potentially
impose tax on publicly traded trusts (the "SIFT Provisions").
However, the SIFT Provisions do not impose tax on a publicly traded
trust which qualifies as a real estate investment trust ("REIT").
RioCan currently qualifies as a REIT and intends to continue to
qualify for future years. Should this not occur, certain statements
contained in this News Release may need to be modified. 
Except as required by applicable law, RioCan under takes no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise. 
Contacts:
RioCan Real Estate Investment Trust
Rags Davloor
Executive Vice President & CFO
(416) 642-3554
www.riocan.com
 
 
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