RioCan Real Estate Investment Trust (OTCPK:RIOC.F) 2025 Investor Day Transcript

Summary of RioCan Real Estate Investment Trust 2025 Investor Day Company Overview - Company: RioCan Real Estate Investment Trust - Event: 2025 Investor Day held on November 18, 2025 - Key Speakers: Jennifer Suess (SVP), Jonathan Gitlin (CEO), Dennis Blasutti (CFO), John Ballantyne (COO), Oliver Harrison (SVP of Leasing), Andrew Duncan (CIO) Core Industry Insights - Industry: Real Estate Investment Trust (REIT) focused on retail properties in Canada - Market Position: Strong focus on core retail portfolio, emphasizing long-term growth and value creation Key Points and Arguments 1. Growth Target: RioCan aims for long-term core Funds From Operations (FFO) growth of 5%, driven by same property Net Operating Income (NOI) growth of at least 3.5% and capital recycling contributing an additional 1.5% [8][9][19] 2. Retail Focus: The company emphasizes its productive retail core, which is seen as resilient and a secure source of growth, particularly in the Canadian market [10][12][18] 3. Market Conditions: Canada is characterized by strong demographics, resilient consumer spending, and political stability, which are favorable for retail operations [11][12] 4. Supply Constraints: There are enduring supply constraints in the retail sector due to high barriers to entry, making it difficult to build new retail spaces [12][13] 5. Tenant Composition: RioCan's tenant mix includes essential retailers such as grocery, pharmacy, and fitness, which are crucial for daily consumer needs [34][38] 6. Capital Management: The company is focused on strengthening its balance sheet with a target net debt to EBITDA ratio of 8-9 times and aims for a 9% unlevered Internal Rate of Return (IRR) on capital investments [19][28] 7. Core FFO Definition: Core FFO is defined as high-quality, durable income excluding non-recurring items, with a baseline target of at least CAD 1.55 for 2025 [25][26] 8. Leasing Strategy: The company has successfully completed grocery deals that increased foot traffic and achieved an average rent premium of 24% over previous rents [36][38] 9. Data-Driven Approach: RioCan utilizes a proprietary analytics platform, Northstar, to identify growth opportunities and optimize tenant mix [41][44] Additional Important Insights - Tenant Relationships: Strong partnerships with major retailers like Canadian Tire and Empire are highlighted, showcasing the collaborative approach to real estate [55][63] - Market Adaptation: Retailers are adapting to market changes by leveraging data and enhancing their operational models, which benefits their partnerships with RioCan [56][58] - Future Developments: Projects like the Yonge Eglinton Centre and RioCan Burloak are examples of strategic repositioning to unlock growth potential [46][50] Conclusion RioCan Real Estate Investment Trust is positioned for sustained growth through a disciplined focus on its core retail portfolio, strategic capital allocation, and strong tenant relationships, all supported by a favorable market environment in Canada. The company aims to achieve a minimum of 3.5% same property NOI growth over the next three years, leveraging its data-driven insights and operational excellence.