ANNUAL GENERAL MEETING May 29, 2018
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, 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. 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. 2
CHAIRMANS REMARKS Paul V Godfrey Chairman 3
VALUE PROPOSITION AND FOUR STRATEGIC PILLARS REAL VISION, SOLID GROUND CANADA S MAJOR MARKET PORTFOLIO DRIVING ORGANIC GROWTH UNLOCKING INTRINSIC VALUE STRATEGIC ACQUISITIONS STRONG BALANCE SHEET $
COMMITTED AND IN-PLACE OCCUPANCY 40 bps increase 95.1% 95.3% 95.6% 96.2% 96.7% 95.2% 96.8% 96.0% 96.6% 95.6% 96.6% 95.7% 94.4% 93.6% 93.6% 92.9% 130 bps increase Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2016 2017 2018 Committed Occupancy In Place Occupancy 5
RIOCAN LEADERSHIP TEAM EXPERIENCE, INTEGRITY AND FORESIGHT Strong executive bench with a wealth of experience and proven track record Ed Sonshine O.Ont., Q.C. Founder and CEO Rags Davloor President and COO 25 years in Real Estate, Operations & Finance Qi Tang, SVP and CFO 20 years in Finance & Real Estate Trusted and respected, with deep industry knowledge and relationships Jonathan Gitlin, SVP Investments & Residential 18 years in Real Estate Jeff Ross, SVP Leasing & Tenant Construction 30 years in Real Estate John Ballantyne, SVP Asset Management 24 years in Real Estate Andrew Duncan SVP Developments 18 years in Development, 12 years in Real Estate Danny Kissoon SVP Operations 32 years in Real Estate Jennifer Suess SVP General Counsel & Corporate Secretary 16 years in Law with a focus on Real Estate 6
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 7
THANK YOU TO RETIRING BOARD MEMBER Clare Copeland 8
WELCOME TO THE BOARD OF TRUSTEES Richard Dansereau 9
Frank King 10
ANNUAL GENERAL MEETING May 29, 2018
OPENING REMARKS Edward Sonshine O.Ont., Q.C. Chief Executive Officer 12
COMMITTED OCCUPANCY COUPLED WITH STRONG RENT GROWTH 110.0% Target Departure 19 Sears Closures 100.0% 90.0% 97.4% 97.6% 97.4% 96.9% 97.0% 94.0% 95.6% 96.6% 96.6% 18 $17.93 $17.75 $17.59 80.0% $17.11 17 $16.69 70.0% $16.08 16 60.0% $15.70 50.0% $14.82 $15.21 15 40.0% 14 30.0% 20.0% 2010 2011 2012 2013 2014 2015 2016 2017 Q1 2018 13 Committed Occupancy Average Net Rent 13
CANADA VERSUS UNITED STATES RETAIL ENVIRONMENT 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 14
STRONG SAME PROPERTY NOI GROWTH Same Property NOI Growth 2.6% 2.1% 0.5% 2015 2016 2017 Q1 2018 (1.8%) Target Departure 15
EVOLVING & RESILIENT TENANT MIX ADAPTING TO THE EVER CHANGING RETAIL ENVIRONMENT Retailer Category Grocery/ Pharmacy Liquor/ Restaurant % of Rent Q1 2018 Change since 2007 27.8% 3.3% Key Brands Personal Services 20.3% 4.2% Value Retailers 15.1% 2.5% Specialty Retailers 10.1% 0.0% Furniture and Home Department Stores/ Apparel 10.0% 1.6% 8.8% (7.5%) Movie Theatres 4.6% (1.7%) Entertainment and Hobby 3.3% (2.4%) 16
SAGE HILL CROSSING CALGARY, ALBERTA 372,000 square foot development Completed in 2017 Walmart opened in 2015 and Loblaws and opened in early 2016 Site is nearly 100% leased 17
EAST HILLS CALGARY, ALBERTA 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 18
DISPOSITION PROGRESS TO DATE 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 19
STRONG SAME PROPERTY NOI GROWTH 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 20
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 1717 Avenue Road Shoppes on Queen (Queen and Portland) 21
INTENSIFICATION STRATEGY DEVELOPMENT 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 ROBUST DEVELOPMENT PIPELINE 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 Future est. density, 8.5m sf, 32.4% Total Pipeline by Zoning Status (26.2M* sf) Zoned, 12.2m sf, 46.5% Application submitted, 5.5m sf, 21.1% 1. Includes 22.2M of incremental NLA and 4.0M of NLA which is currently income producing. All data at Riocan s interest. 23
RIOCAN LIVING 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. 24
RIOCAN LIVING NORTHEAST YONGE AND EGLINTON (ecentral) 25
RIOCAN LIVING KING AND PORTLAND (KINGLY) 26
RIOCAN LIVING GLOUCESTER (FRONTIER) 27
UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETS BRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS Shoppers World Brampton RioCan Sandalwood Square RioCan Grand Park 28
UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETS BRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS 29
UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETS BRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS 30
UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETS BRAMPTON/MISSISSAUGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS 31
THE WELL Excavation has commenced for The Well Confident that we will be able to announce the lead tenants for the office tower later this year 32
THE WELL 33
THE WELL 34
CHANGES TO RIOCAN S BOARD OF TRUSTEES Clare Copeland Richard Dansereau 35
Q&A 36