RioCan Real Estate Investment Trust Announces Partnership in Masterplan Community at Queen & Coxwell in Toronto
TORONTO, April 29, 2021 (GLOBE NEWSWIRE) — RioCan Real Estate Investment Trust (“RioCan” or the “Trust”) (TSX: REI.UN) today announced a new mixed-use project (“QA Masterplan”), located at Queen and Coxwell in Toronto. This project is to be developed in a 50/50 partnership with Context (together with RioCan – the “Partners”) and in collaboration with the City of Toronto and Toronto Community Housing Corporation (“TCHC”). QA Masterplan will contribute to the revitalization of the neighbourhood and address different levels of housing affordability with housing types ranging from condominiums to market and affordable rental units. The condominium component (“QA Condos”) has achieved 88% of pre-sales in line with projections.
Steps from the waterfront of Lake Ontario and Ashbridges Bay in Toronto East, the 3.5 acre site at Queen and Coxwell is located between the highly coveted Leslieville and the Beaches neighbourhoods. The thoughtfully designed QA Masterplan will include:
- Developing a new building to replace the TCHC’s existing 120 apartment units on the site, which will be retained and owned 100% by TCHC;
- Adding new residential space consisting of 367 new condominium units, 183 market rental units and 50 affordable rental units, as well as 32 affordable rental units that will ultimately be sold to the City upon completion at a pre-determined price; and
- Building ~16,000 square feet of new podium retail space.
“We are very pleased to be playing a part in creating a new community that will provide much-needed housing for all income levels and introduce vital retail amenities to serve this growing neighbourhood. The significant progress on condominium pre-sales at this up-and-coming mixed-used community is a clear indication of its desirability and the demand for this type of product,” said Jonathan Gitlin, President & CEO of RioCan. “This project perfectly aligns with our evolution into Canada’s leading major market, mixed-use focused REIT. It will provide us income and asset diversification through purpose-built rental and will add to our expanding condominium inventory which fuels our FFO and NAV per Unit growth.”
The site is currently owned by TCHC and land title transfer to the Partners is expected in the summer of 2021 upon part-lot severance, at which point the Partners will proceed with demolition activity. In the interim, the Partners have proceeded with the pre-construction phases of the project including condominium pre-sales. QA Condos form part of the 1,609 condominium and townhouse units currently under construction or pre-sale by RioCan and its partners as summarized in the following table:
|# of Units
(at a 100%)
|RioCan Ownership||Estimated Inventory Profit
(at RioCan Interest)
|Anticipated Date of Completion|
|U.C. Uptowns – Townhomes
Windfields Farm – Oshawa, ON
|U.C. Tower – Condominiums
Windfields Farm – Oshawa, ON
|11YV – Condominiums
Yorkville – Toronto, ON
|QA – Condominiums
Queen & Coxwell –Toronto, ON
1) Based on very preliminary estimates
RioCan has many options to utilize the 42mm square feet of identified GFA density that is inherent in its existing portfolio. In addition to the projects noted above, the Trust will continue to utilize some of this density for condominium and for housing ownership developments, particularly as components of larger multi-phased mixed use communities. These inventory projects represent yet another lever for RioCan’s growth going forward. The prominence of this utilization will be governed by the market conditions at the time and the make-up of the Trust’s balance sheet.
Building on RioCan’s history of investing in the communities that it serves and aligned with its Environmental, Social and Governance strategy, the Partners will be supporting the City’s Community Economic Development Initiative as part of this project. The Partners’ contributions to the initiative includes a $100,000 scholarship fund for TCHC tenants, a $250,000 economic and social development fund and a minimum of $500,000 in value for job opportunities.
The Partners have applied for financing through the Rental Construction Financing Initiative (“RCFI Financing”) to help finance the non-condominium components of the project. RCFI Financing is provided directly by the Canada Mortgage Housing Corporation (“CMHC”) for eligible affordable rental housing projects and typically bears interest at rates lower than standard CMHC insured loans. If the application is successful, such financing will serve to further augment the overall project economics.
RioCan has forward purchase obligations to purchase Context’s 50% interest in the retail and residential rental components of the project at pre-determined purchase prices upon meeting certain pre-determined thresholds such as reaching certain stabilized NOI target, certain time limits, or certain planning act compliance requirements. More information will be disclosed upon land transfer and start of project construction.
Founded in 1997, Context is focused on the development of mixed-use projects, condominiums and affordable rental housing in Toronto’s central neighbourhoods. Context is a pioneer in downtown intensification with buildings based on quality design, sustainability and innovative city planning.
RioCan is one of Canada’s largest real estate investment trusts. RioCan owns, manages and develops retail-focused, increasingly mixed-use properties located in prime, high-density transit-oriented areas where Canadians want to shop, live and work. As at December 31, 2020, our portfolio is comprised of 223 properties with an aggregate net leasable area of approximately 38.3 million square feet (at RioCan’s interest) including office, residential rental and 14 development properties. To learn more about us, please visit www.riocan.com.
Forward Looking Information
This News Release contains forward-looking information within the meaning of applicable Canadian securities laws. This information reflects RioCan’s objectives, our strategies to achieve those objectives, as well as statements with respect to management’s beliefs, estimates and intentions concerning anticipated future events or expectations that are not historical facts. Forward-looking information 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 information reflects management’s current beliefs and is based on information currently available to management. All forward-looking information in this News Release is qualified by these cautionary statements.
Forward-looking information is not a guarantee of future events or performance and, by its nature, is based on RioCan’s current estimates and assumptions, which are subject to numerous risks and uncertainties, including those described in the “Risks and Uncertainties” section in RioCan’s MD&A for the period ended December 31, 2020 and in our most recent Annual Information Form, which could cause actual events or results to differ materially from the forward-looking information contained in this News Release.
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 this forward-looking information. The forward-looking statements contained in this News Release are made as of the date hereof, and should not be relied upon as representing RioCan’s views as of any date subsequent to the date of this News Release. Management undertakes no obligation, except as required by applicable law, to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise.