management investor presentation third …...6 8.7% 26.2% 64.6% 3.7% 8.1% 17.8% 2006 2011 2017 2036...

MANAGEMENT INVESTOR PRESENTATIONThird Quarter 2018

November 1, 2018

2

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 September 30, 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.

2

NON-GAAP MEASURES FORWARD LOOKING INFORMATION

RioCan data and statistics are based on September 30, 2018

information. Peer group included published results where provided

from First Capital Realty Corp. (FCR), SmartCentres REIT

(SRU.UN), Choice Properties REIT (CHP.UN), CT REIT (CRT.UN),

and Crombie REIT (CRR.UN). Certain slides contain a peer

comparison that was based on the respective issuer’s reported

information as at June 30, 2018.

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.PEER DATA PRESENTATION

http://www.sedar.com/

RioCan NLA RioCan NLA includingincremental NLA from

Development*

Calgary

Edmonton

Vancouver

Toronto

MontrealOttawa

BC

ON

12.9%

9.5%

5.1%

5.5%

5.6%

ABOUT RIOCAN

45.5%

• One of Canada’s largest REITs, focused on the ownership,

management and development of high quality, necessity

based retail, increasingly mixed-use properties in Canada’s

six major markets

• Founded in 1993 – 25 year track record

• Robust 26.5 M sf development pipeline, 11.9 M sf or 45%

already approved for zoning – mostly mixed-use

• Diversified and evolving tenant mix

• Rated BBB with stable outlook by S&P and BBB (high) by

DBRS

Annualized Revenue from Six Major Market: 84.1%

Quick Facts

Enterprise Value $13.7 B

Number of Properties 250

Net Leasable Area (NLA) 40.4M sf

Same Property NOI (Q3 2018) 1.6%

Major Market Same Property NOI (Q3 2018) 2.1%

Committed Occupancy 97.0%

Major Market Committed Occupancy 98.0%

GTA Focus - % of Annualized Rental RevenuePeer Average1

45.5%24.0%

Revenue from National Tenants 84.1%

Average Net Rent $18.32

GROWTH DRIVEN BY INSIGHT

Robust Development ProgramTremendous source of future NAV growth

22.5M

incremental

NLA or 59% of

existing NLA2

38.4M

existing

IPP NLA

2. Includes incremental NLA of 22.5M sf plus 4.0M sf that is currently income producing.

Assumes all development projects per the MD&A for the period ended Sept. 30, 2018 are

completed and assumes no additional development, acquisitions, or dispositions

1. Source: company reports; Peers: FCR, CHP, CRT; no data on CRR and SRU

4

CANADA’S MAJOR MARKET PORTFOLIO• High quality, necessity based retail, and increasingly mixed-use major markets portfolio

• Diversified, strong national tenant base

• Significant upside on rent growth

• Base for significant NAV growth – tremendous intrinsic value to be unlocked

• Strong executive bench with wealth of experience and proven track record

• Focusing on transit-

oriented urban

intensification in major

markets

• Mostly mixed-use with

residential rental

and/or condo

development

• Strategic alliances to

mitigate risk and

create steady fee

stream

• Robust and growing

pipeline of well located

sites with substantial

zoning approved

UNLOCKINGINTRINSIC VALUE

STRATEGIC ACQUISITIONS

• Acquire only the best

locations in the six

major markets

• Opportunities to

acquire partners’

interests in today’s

tight market

• Highly selective

acquisitions of

development sites,

leveraging existing

properties

DRIVING ORGANIC GROWTH

• Evolving tenant mix

and revenue growth

• Improving operating

efficiency and cost

structure

• Redeveloping prime

assets

• Optimize pads by

adding additional

GLA

• Drive ancillary

revenues

• Continuous portfolio

pruning

• Low leverage

• Low cost of debt

• Laddered debt

maturity and mostly

fixed rate

• Access to multiple

sources of capital

• Large

unencumbered

assets pool

generating 56.6% of

annualized NOI

STRONG BALANCE SHEET

VALUE PROPOSITION AND FOUR STRATEGIC PILLARSREAL VISION, SOLID GROUND

5

CANADA’S MAJOR MARKET PORTFOLIO


• High quality, necessity based retail, and increasingly mixed-use major markets portfolio

• Diversified, strong national tenant base

• Significant upside on rent growth

• Base for significant NAV growth – tremendous intrinsic value to be unlocked

• Strong executive bench with wealth of experience and proven track record

CANADA’S MAJOR MARKET PORTFOLIOWHERE CANADIANS SHOP, LIVE AND WORK

CANADA’S SIX MAJOR MARKETSWHERE THE POPULATION GROWTH IS

• By 2036, more than half of Canadians will live in Canada’s six major markets

2006, 2017 Data: Statistics Canada2036 Data: Statistics Canada, Provincial and Municipal population forecasts

6

8.7%

26.2%

64.6%

3.7%8.1%

17.8%

2006 2011 2017 2036 Forecast

Cumulative Population Growth2006 as Base Year

Six Major Markets Secondary markets

Cumulative population growth between 2006 and: 2017 2036 Forecast

Six major markets 26.2% 64.6%

Secondary markets 8.1% 17.8%


7

Disposition Progress as of Oct. 30, 2018

Transaction type Value (M)

Closed and Firm $1,074

Conditional $178

Total to Date $1,252

Weighted Average Cap Rate 6.49%

• Sale prices to-date are materially in line

with IFRS value

• $1.3B progress since the October 2017

announcement representing approximately

63% of the $2.0B disposition target

• Dispositions span a broad range of

secondary markets

63% of

Disposition

Target

Closed/Firm/Conditional

Dispositions

DISPOSITION UPDATEBUYER PROFILE

8

REITs

• Strategic buyers, such as CT REIT, who are looking to acquire assets where their retail

banner is already a tenant. They know these assets well and recognize the advantage of

controlling properties in which their associate retail banners operate.

• Geographically focused REITs looking to expand footprint in a particular region.

• Small cap REITs looking for growth and accretive acquisitions, which would otherwise be

unavailable in major markets.

Private Individual Buyers

• Objectives include capital preservation and stable, risk-adjusted returns.

• These buyers have local expertise or presence in particular secondary markets, and

therefore covet these assets.

Private Equity and Investment Managers

• Objectives include deploying a robust supply of capital in a low-interest rate environment.

• Increasingly looking at secondary markets in the core to value-add risk range due to limited

supply of product in primary markets.


84.1%

>90%

Q3 2018 Vision

Major Market Revenue

WHERE CANADIANS SHOP, LIVE AND WORK

• Higher concentration of revenue from the fastest growing markets

in Canada

• Higher concentration of revenue from the GTA, Canada’s largest

and most important financial market

• Enhanced growth profile

• Improved cost structure

9

45.5%

>50%

Q3 2018 Vision

GTA Revenue Focus

24

19

Q3 2018 Vision

Avg. Age Portfolio (yrs.)

10

GREATER TORONTO AREA (GTA) FOCUS

CONSISTENTLY ABOVE 95%

• Strong, consistent, industry leading presence in the Greater Toronto Area, which has one

of the highest population and economic growth profiles in the country

PERCENTAGE OF RENT FROM THE GTA EXCEEDS OUR PEERS

Source: company reports; Peers: FCR, CHP, CRT; no data on CRR and SRU

34.6%

36.8%

41.9%42.8%

41.7% 41.7% 40.9%

45.5%*

24.0%

32.0%

25.2% 25.6% 22.0%23.1% 23.3%

24.0%

2011 2012 2013 2014 2015 2016 2017 Q3 2018

REI Peer Average

* Effective Jan 1 2018, the Trust includes Hamilton in the GTA as the Trust believes that Hamilton is a high growth market that forms part of the contiguous urban

region and has strong rapid transit connections to Toronto.

INDUSTRY LEADING PRESENCE IN THE TORONTO CORE AND GTA

11

RioCan

First Capital

SmartCentre REIT

GREATER TORONTO AREA (GTA) FOCUS


• Higher concentration (~30% increase in average population

density) of a more desirable demographic with stronger

household income

• Improved portfolio quality; operating efficiencies, newer assets,

and less capex

12

* Vision represents the average population and average income within a 5km radius of RioCan properties after completion of the Trust’s

over $2.0B disposition targets. The 2017 data are based on RioCan’s portfolio as at December 31, 2017. Source: Environics Analytics.

~157k

~205k ~212k

2017 - AllMarkets

2017 - MajorMarkets

2020

Avg. Population(5km radius)

~$102k ~$111k

~$120k

2017 - AllMarkets

2017 - MajorMarkets

2020

Avg. Income (5km radius)

13

CONSISTENT GROWTH IN FUNDS FROM OPERATIONS

Includes

$88.3M (or

$0.28/unit)

Target

Settlement

FROM CONTINUING OPERATIONS

2014-2017 CAGR for Continuing Operations FFO/Unit*: 9.9%

* Continuing and discontinued operations FFO per unit is calculated based on disclosed total continuing and discontinued operations FFO, respectively, divided by the weighted average number of units (diluted) for the respective years.

** FFO Payout Ratio calculated on a rolling 12 month basis

Well-timed

exit from U.S.

retail market$1.34$1.62 $1.53

$1.78

$1.40

$1.65

$1.94

$1.68$1.79

85.5% 84.8%

83.6%

78.8%78.0%

68.0%

70.0%

72.0%

74.0%

76.0%

78.0%

80.0%

82.0%

84.0%

86.0%

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

2014 2015 2016 2017 9 mths 2018

Continuing Operations FFO/Unit Discontinued Operations FFO/Unit (US) FFO Payout Ratio**

14

OPTIMIZING PORTFOLIO FOR CURRENT MARKET ENVIRONMENT

GROWING

Home Furnishings, Food, Fitness, Beauty and Value Retailers continue to be

bright spots in the retail landscape, with numerous brands adding additional

physical locations

• Small format service-oriented retail performing well, numerous tenants expanding

• Continued urban centre growth from national gym operators and expansion of

smaller, boutique-type operators.

• Quick service restaurants aggressively growing

• Value retailers such as Winners, Marshalls, Dollarama, etc. are rapidly expanding

• New specialty grocers are appearing and others, such as Nations and Farm Boy are

expanding

EVOLVING

Shifting demand for large formats • Some pressure from the larger format tenants upon renewal as they have options to

relocate and right-size their existing boxes

• Relocations open up opportunities for large format, value retailers who are

aggressively growing (e.g. TJX and Lowe’s)

DECLINING

Full price fashion continues to struggle• Department stores reporting soft fashion sales

• Bankruptcies continue both north and south of the border

• Small format fashion retailers not opening new locations

15

CHANGING TRENDS IN HOUSEHOLD SPENDING

Source: GWL Realty – “What is driving change in the retail sector beyond online shopping” March 14, 2018

16

EVOLVING & RESILIENT TENANT MIX

Retailer

Category

% of

Rent

Q3

2018

Change

since

2007

Key Brands

Grocery/

Pharmacy

Liquor/

Restaurants

27.3% 2.8%

Personal Services 20.7% 4.6%

Value Retailers 14.5% 1.9%

Specialty

Retailers10.5% 0.4%

Furniture and

Home10.3% 1.9%

Department

Stores/ Apparel8.6% (7.7%)

Movie Theatres 4.7% (1.6%)

Entertainment and

Hobby3.4% (2.3%)

ADAPTING TO THE EVER CHANGING RETAIL ENVIRONMENT

17

STAGGERED LEASE MATURITY WITH RENT GROWTH OPPORTUNITYLEASE MATURITY AND EXPIRING RENT

• Favorable expiry profile that balances stability with opportunity for growth on renewal

• Average lease term for Top 30 tenants – 7.4 years

1.6%

9.5%

11.0%

12.3%

9.6%

$21.07

$18.95 $19.50$18.69

$21.26

0

5

10

15

20

25

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

20.00%

2018 remainder 2019 2020 2021 2022

Lease Maturity Expiring Rent

97.4% 97.6% 97.4% 96.9% 97.0%94.0% 95.6% 96.6% 97.0%

$14.82

$15.21

$15.70

$16.08

$16.69

$17.11

$17.59$17.75

$18.32

13

14

15

16

17

18

19

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

110.0%

2010 2011 2012 2013 2014 2015 2016 2017 Q3 2018

Committed Occupancy Average Net Rent

18

CONSISTENTLY HIGH OCCUPANCYCOUPLED WITH STRONG RENT GROWTH

• Average net rent growth also reflects the improvements in the overall quality of the portfolio as RioCan increased its major market focus over time

• Major markets: committed occupancy – 98.0%, in-place occupancy 97.5%

Target

Departure

19

STRONG RETENTION RATIO


• RioCan has maintained a consistent strong retention rate

• Strong track record of tenant retention averaging 89.1% since 2013

• No peer comparison available as most peers no longer report this statistic

88.0%90.2%

85.7%85.8%

91.1%93.8%

60.0%

65.0%

70.0%

75.0%

80.0%

85.0%

90.0%

95.0%

100.0%

2013 2014 2015 2016 2017 Q3 2018

20

WELL DIVERSIFIED NATIONAL TENANT BASENO SINGLE TENANT OVER-EXPOSURE

Top 10 Tenant NameAnnualized Rental

Revenue

Number Of

Locations

NLA (Sq. Ft. in

'000s)

Weighted Avg

Remaining Lease

Term (Yrs)

1 4.8% 71 1,827 7.8

2 4.5% 72 1,870 6.1

3 4.3% 27 1,448 8.3

4 4.2% 70 1,881 6.3

5 3.6% 23 2,784 9.4

6 3.2% 40 1,653 7.8

7 1.7% 12 1,419 9.9

8 1.7% 88 429 7.5

9 1.7% 23 823 8.3

10 1.7% 74 676 5.7

TOTAL 31.4% 500 14,810 7.7

Peer Average (iii) 62.3% -- -- --

(i) Loblaws includes Shoppers Drug Mart, No Frills, Fortinos, Zehrs and Maxi. (ii) Canadian Tire Corporation includes Canadian Tire/PartSource/Mark’s/Sport Mart/ Sport Chek/Sports Experts/National Sports/Atmosphere.(iii) Source: company reports; Peers: FCR, CHP, CRT, CRR and SRU as at June 30, 2018

As at September 30, 2018

(i)

(ii)

Recipe Unlimited (formerly Cara)

21

LEADERSHIP TEAM

Ed Sonshine

O.Ont., Q.C.

Founder and CEO

John Ballantyne,

SVP Asset

Management

24 years in Real Estate

Jeff Ross,

SVP Leasing & Tenant

Coordination


Andrew Duncan

SVP Developments

18 years in Development,


Qi Tang,

SVP and CFO

20 years in Finance

& Real Estate

Jonathan Gitlin,

COO


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

• Strong executive bench

with a wealth of experience

and proven track record

• Fully integrated REIT with

all disciplines in-house

including:• Investments

• Leasing

• Asset Management

• Development &

Construction

• Property Management

• Finance, Legal and

Human Resources

• Trusted and respected, with

deep industry knowledge

and relationships

EXPERIENCE, INTEGRITY AND FORESIGHT

22


STRATEGIC PILLAR ONE: DRIVING ORGANIC GROWTHOPTIMIZING AND FUTURE PROOFING OUR PORTFOLIO

DRIVING ORGANIC GROWTH

• Evolving tenant mix and revenue growth

• Improving operating efficiency and cost

structure

• Redeveloping prime assets

• Optimize pads and add additional GLA

• Drive ancillary revenues

• Continuous portfolio pruning

23

DRIVING ORGANIC GROWTHCASE STUDY

Burlington Mall, Burlington Ontario – 2018

• $65M redevelopment and renovation of this iconic centre in

Canada’s Best Mid-Sized City (voted five years in a row)

• Rebranded to Burlington Centre

• Renovated food court

• Strategically remerchandised (former Target location):

• Confirmed new tenancies include Indigo, Denninger’s

Foods of the World, Sportchek and Winners

Metric

At

Acquisition

(2013)

Capital

Invested

Anticipated

Stabilized

Value $206.5M $55M $287.5 M

NOI $9.9M - $14.1M

NOI will increase by 42%

DRIVING ORGANIC GROWTHCASE STUDY

RIOCAN YONGE EGLINTON CENTRE, TORONTO

24

Intersection: Yonge St. and Eglinton Avenue East

Ownership: 100%

Total GLA: 1,056,285 sf

Property Concept: Mixed-use

Project Completion: 2016

Surfacing Value:• Purchase Price (2007): $223 million

• Capital Invested $110 million

• Current Value: $574 million

• NOI at acquisition: $13 million

• Value Stabilized NOI: $26 million

73% increase in value over costs

• Strategically evolved tenant mix to meet consumer

needs

• Incremental revenue through leasing of the digital

screens on the building interior and exterior

25

CAPITALIZING ON RE-LEASING OPPORTUNITIESTARGET RE-LEASING & SEARS UPDATE

Target Re-leasing

• Re-leasing of former Target space 1.7 M sf

• Substantially completed Q4 2017

• Annual net rent revenue from releasing tenants: $14.0 M

• Annual rent revenue paid by Target of $10.6 million

• Annual net rent increase over Target rent: $3.4 million or 32.1%

• Significant capital recovered by way of settlement with Target of

$88.3M (at RioCan’s interest)

• Greater customer appeal and traffic

• Stronger, more diversified tenants

Sears Update

• Sears departure left 313,000 sf of space to re-lease at RioCan’s interest (vs. Target 1.7M sf)

• Completed leases, conditional leases or leases in advanced negotiations to replace 120% of the net

revenue and while only representing 75% of the former Sears GLA

• Leasing is much less complex than leasing former Target spaces

• Replacement tenants will be stronger and more diversified

• Properties will have broader customer appeal and replacement tenants will drive incremental traffic

26

COMPLETED DEVELOPMENTSCASE STUDY

• Demographics in 5km radius:

• Population: 95k

• Average household income: $145k

Location – Located in a growing residential

suburbs in Northwestern Calgary

Ownership Structure – 50% (JV with KingSett)

Property Type – New format retail

• Substantially completed in Q4 2017

• 380,000 sf Walmart and Loblaws anchored

centre

• The first Loblaws City Market banner in

Calgary

• Excellent mix of strong national tenants:

London Drugs, Dollarama, Scotiabank,

McDonalds, Royal Bank of Canada

SAGE HILL CROSSING,

CALGARY AB

27

Proposed

• Well defined sustainability policy and sustainability governance

structure

• Participation in the Global Real Estate Sustainability Benchmark

("GRESB") Survey

• Inclusion of a new performance indicator for management

• RioCan was recently included in the MSCI Canada IMI

Women’s Leadership Select Index

• Employee survey was conducted to collect feedback on

sustainability drivers

• Establishment of a baseline for sustainability: energy, water

and Greenhouse Gas ("GHG") emissions

• Establishment of sustainability standards for our income

producing properties and development projects

• Pursuing Toronto Green Standard (TGS) Tier II for The

Well and Sunnybrook Plaza projects, and LEED Gold &

TGS Tier II for its Yonge Sheppard Centre project

• Extension of Enwave’s existing Deep Lake Water

Cooling network via a new 12 million-litre energy storage

facility at The Well (see image) to provide a low-carbon,

resilient cooling and heating option for the property and

the surrounding communities

• Geothermal energy system for heating and cooling to be

incorporated at RioCan’s Gloucester project in Ottawa

Proposed

ENVIRONMENTAL SOCIAL AND GOVERNANCE AT RIOCANEMBEDDING SUSTAINABILITY

28


STRATEGIC PILLAR TWO: UNLOCKING INTRINSIC VALUEREALIZING THE POTENTIAL OF OUR CORE ASSETS

• Focusing on transit-oriented urban

intensification in major markets

• Mostly mixed-use with residential rental

and/or condo development

• Strategic alliances to mitigate risks and

create steady fee stream

• Robust and growing pipeline of well

located sites with substantial zoning

approved

• Strong development team with a wealth

of experience in mixed-use residential

development projects from planning,

design to completion

UNLOCKING INTRINSIC VALUE

29

SOURCES OF TREMENDOUS NAV GROWTH

• Strong, major market, urban focused development pipeline with high quality projects in prime

locations, predominantly transit oriented

• Risk mitigation via staggered development starts and the use of strategic alliances

• Maintain a disciplined approach to capital allocation and maintain leverage in the 38%-42% debt to

asset range , although leverage as of a quarter end may temporarily exceed the upper target due to

NCIB and disposition timing

ROBUST DEVELOPMENT PIPELINE

1. Total development pipeline of 26.5M sf includes incremental NLA of 22.5M sf plus 4.0M sf that is currently income producing

2. Assumes all development projects per the MD&A for the period ended Sept. 30, 2018 are completed and assumes no

additional development, acquisitions, or dispositions

22.5M incremental

NLA1 or 59% of

existing NLA2

39.8M existing

IPP NLA

RioCan NLA RioCan NLA including incremental NLAfrom Development*

30

TREMENDOUS SOURCES OF CASH FLOW & NAV GROWTH

* Includes 22.5M sf of incremental NLA and 4.0M sf of NLA which is currently income producing. All data at RioCan’s interest.

• 45% or 11.9M sf with zoning approved and nearly 100% is located in the six major markets

• Particularly valuable in today’s more challenging regulatory environment• Uncertainty in Ontario regarding transition to the newly implemented Local Planning

Appeal Tribunals given that its mandate is unclear

PIPELINE IS EXPECTED TO CONTINUE TO GROW

Zoned, 11.9m sf, 45.1%

Application submitted, 5.4m sf, 20.3%

Future est. density, 9.2m sf, 34.6%

Total Pipeline by Zoning Status(26.5M sf)

Commercial 0.8m sf:

3.0%

Residential & Air Rights 17.6m sf

Commercial 7.1 m sf

Residential Inventory 1.0m sf

Mixed-use Residential 25.7m sf:97.0%

Total Pipeline by Project Type

INTENSIFICATION STRATEGYDEVELOPMENT PROCESS FOR EXISTING INCOME PRODUCING PROPERTY

31

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

32

At RioCan’s Interest 2018 Q4 2019 2020

Est. Completed NLA (‘000s sf)1 317 528 477

Est. PUD Completions (millions)2 $299 $279 $305

1. Estimated NLA completions are NLA transferred to IPP upon projects’ completion in each period, which are estimated as 90% of gross floor area (GFA)

2. Estimated PUD cost completions are fully loaded IFRS costs including land that are to be transferred to IPP upon projects’ completion in each period, net of land and air rights sales for active projects with detailed cost estimates

Annualized stabilized NOI from active projects with detailed costs estimates to be completed between Q4 2018 and end of 2020 is expected to be

approximately $46 million at RioCan's interest. The annualized stabilized NOI of a project is an estimate of stabilized NOI following completion of a

project on a full year basis. NOI to be reported for the remainder of 2018 to 2020 will be different from this range, due to the partial year effect in a

given year as a result of project completion timing and the effect of property lease up period.

TREMENDOUS SOURCES OF CASH FLOW & NAV GROWTHSELECTED DEVELOPMENT COMPLETIONS OVER THE NEXT THREE YEARS

College & Manning

(Strada)

Brentwood Village

(Brio)

King Portland Centre

(Kingly)

Bathurst College Centre

Yonge & Eglinton

Northeast Corner

(eCentral)

Gloucester Phase

I (Frontier)

Dupont Street (Litho)

DEVELOPMENT TEAM

• Balanced, experienced talented team

• Established strong industry relations

• Identify opportunities in robust pipeline of urban, transit-oriented sites

• 33 team members – Planners, Engineers, Construction Managers, Analysts

• Three office locations – Toronto, Calgary, Montreal

Planning & Zoning Process

Design Analytics Residential Construction

DEVELOPMENT TEAMSTRONG EXPERIENCED AND CAPABLE TEAM OF PROFESSIONALS

33

DEVELOPMENT TEAMDEVELOPMENT TEAMCROSS FUNCTIONAL COORDINATION ACROSS VARIOUS DISCIPLINES

34

RioCan Mixed-Use

Development Team

Investments & Residential

Leasing

Asset Management /

Operations

Developments

3rd Party Property

Management, at the

current state

• Product Development

• Acquisitions/Dispositions/Joint Ventures

• Branding

• Marketing

• De-leasing

initiatives

• Tenant relations

• Prospective

tenant

engagement

• Commercial reporting, if Partner involved

• Day-to-day management of commercial

component

• Liasing with Partner

• Initial planning and

concept

• Preliminary pro-forma

development

• Land entitlement

35

UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSURBAN TORONTO HIGHLIGHTS: SELECTED HIGH DENSITY, LOCATIONS

Legend

Under Development

TTC – Existing

Future Development Potential

TTC – Under Development

Selected Urban Toronto

RioCan Developments'000s sf

(100%)

Yonge-Sheppard Centre 362

555 College 108

King Portland Centre 421

Yonge & Eglinton 712

The Well & Building 6 3,000

740 Dupont 180

Sunnybrook Plaza 316

Queensway 538

Dufferin Plaza 449

RioCan Leaside Centre 1,324

Lawrence Square 94

RioCan Hall 736

491 College - complete 24

Bathurst College Centre 141

SELECTED URBAN

TORONTO8,405

TTC – Station

1

2

3

4

5

6

8

9

10

11

12

13

14

Demographics, 5km radiusDense population*:

• 481,000 people

Desirable demographic*:

• HH Income: $130,000+

• Post-secondary education: 65%+

Planned Rapid Transit Line

*Average demographics within a 5km radius of RioCan Urban Toronto development sites

7

7

13

13

Completed Development

UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSBRAMPTON/MISSISSUAGA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS

Selected Brampton/Mississauga RioCan

Future Development Potential '000s sf (100%)

Shoppers World Brampton 4,178

RioCan Sandalwood Square (Ph. I) 180

RioCan Grand Park 330

Selected Brampton/Mississauga

TOTAL4,668

1

12

3

3

2

With three shopping centres and approximately 82 acres

of land on this LRT line, RioCan is uniquely positioned to

take advantage of future intensification opportunities


• 270,000 people+


• HH Income: $100,000+

• Post-secondary education: 50%+

*Average demographics within a 5km radius of selected RioCan Brampton/Mississauga development sites

36

UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSCALGARY HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS

1

2

3

*Average demographics within a 5km radius of selected RioCan Calgary development sites


• 170,000 people+


• HH Income: $137,000+

• Post-secondary education: ~60%

Selected Calgary RioCan Future

Development Potential'000s sf

(100%)

Brentwood Village (Phase I) 145

5th & Third East Village 758

Southland Crossing 968

Selected Calgary TOTAL 1,871

3

2

1

1

2

3

37

38

UNLOCKING THE VALUE OF TRANSIT-ORIENTED ASSETSOTTAWA HIGHLIGHTS: SELECTED HIGH DENSITY LOCATIONS

Selected Ottawa RioCan

Development Potential'000s sf

(100%)

Gloucester/Frontier 649

Lincoln Fields 825

SELECTED OTTAWA POTENTIAL

TOTAL 1,474

2

Legend

Under Development

Future Development Potential

1

2

1


• 150,000 people+


• HH Income: ~ $100,000

• Post-secondary education: ~60%

*Average demographics within a 5km radius of selected RioCan Ottawa

development sites 38

UNLOCKING INTRINSIC VALUERESIDENTIAL INTENSIFICATION

GLOUCESTER RESIDENTIAL PHASE I, OTTAWA

Location: Located on a 7.1 acre portion of RioCan's Gloucester

Silver City Shopping Centre along new Confederation LRT line at

the Blair Station in Ottawa

Ownership: 50% (JV with Killam Apartment REIT)

Property Type: Rental Residential, Phase I contains a 23 storey

tower with 228 units (at 100%)

Zoning status: Zoned

Project Completion: 2019

Estimated PUD Costs (RioCan’s interest): $43.2M

Surfacing Value:• Zoning approved for three additional residential towers

containing the potential for up to 840 units

• Transitioned use from 77,000 sf of struggling fashion retail to a

23 story desirable rental residential building.

• Retail mix at our adjacent shopping centre was evolved and

now includes a strong, diverse mix of tenants including

Cineplex theatre, Indigo, Goodlife and numerous restaurants

• Adjacent to CSIS headquarters: 2,000+ employees

• Leading edge development that will maximize efficiency via a

geothermal energy system for heating and cooling

39

Proposed

• Demographics in a 5km radius:

• Population: 450k

• Average household income:

$164+

UNLOCKING INTRINSIC VALUERESIDENTIAL INTENSIFICATION, GLOUCESTER OTTAWA (Including future phases)

Zoning approved for four residential towers containing the potential for up to 840 units on a 7.1

acre portion of RioCan's Gloucester Silver City Shopping Centre

40

Proposed


• Population: ~700k

• Average household income: ~ $120k

41


740 DUPONT AVE.,TORONTO, ON

Location – Toronto, Ontario

Property Type – Mixed-use retail and residential. 9-storey

project with 210 rental units and 31,000 square feet of retail

GLA. Firm lease with Farm Boy (23,000sf) to anchor the retail

portion of the site.

Ownership - 50% (JV with Woodbourne)


Project Start / Anticipated Completion 2017 / 2020


Surfacing Value

• Site was acquired in 2010, formerly occupied by Grand

Touring automobile until November 2017

• Well located along a busy thoroughfare in a densely

populated area of Toronto. A short walk to the Bloor-

Danforth subway line

Proposed


• Population: ~160k

• Average household income: $141k+

• Well located with easy access to downtown Calgary,

the University of Calgary, McMahon Stadium and

Foothills Hospital

42


BRENTWOOD VILLAGE, CALGARY, AB

Location – Located along the Northwest LRT line and

adjacent to the Crowchild Parkway in Northwestern Calgary in

close proximity to the University of Calgary

Property Type – Mixed-use retail residential, 12-storey, 163

rental units with approximately 10,000sf of retail GLA

Ownership - 50% (JV with Boardwalk REIT)


Project Start / Anticipated Completion 2018 / 2020


Surfacing Value

• Extracting additional value through the redevelopment of an

underutilized retail portion of the site to include additional

residential uses

• RioCan will retain a 100% interest in the remainder of the

shopping centre

Proposed

43


YONGE & EGLINTON NORTHEAST CORNER, TORONTO, ON

Location: At the heart of one of Toronto’s busiest and most

popular intersections. Unparalled access to the Yonge subway

and new Eglinton Crosstown LRT

Property Type: Mixed-use with retail, residential tower with

466 units and condominium tower with 623 units

Ownership: 50% (JV with Metropia and Bazis)

Leasing/Sales: All 623 condominium units have been pre-

sold. Retail is 88% leased (anchored by TD Bank)

Proposed Rental Residential Units: 466 Units

Zoning Status: Zoned

Anticipated Completion: 2018 & 2019


Surfacing Value

• Agreement in place to acquire the partners’ 50% interest in

the 466 unit rental residential tower at cost plus $10M

• Agreement in place to acquire partner’s 50% interest in the

retail NLA at a 7% capitalization rate upon completion of

the project

Proposed



• Daytime population: 489k


• Condo portion of the project is 100% pre-sold


Location: Prime location in trendy Toronto’s downtown west

with direct access to transit

Property Type: Mixed-use with office, retail and condominiums

Leasing/Sales: 132 condominium units fully sold out ahead of

price expectations.

• 100% leased

• Office is 100% leased to Shopify and Indigo

• Existing 55,000 sf of office space adjacent to the building is

100% leased with substantial rent upside upon project

completion

Ownership: 50% (JV with Allied Properties REIT)

Incremental Commercial NLA: 165,000 sf at RioCan’s

Interest


Project Start / Anticipated Completion: 2016/ 2018 & 2019


KING PORTLAND CENTRE,

TORONTO, ON

44

Proposed




• Office tower is targeted LEED platinum

RESIDENTIAL INTENSIFICATION

SUNNYBROOK PLAZA,TORONTO, ON

45

Location: Located on the new Eglinton LRT in an affluent

neighbourhood in midtown Toronto

Ownership: 50% (JV with Concert Properties)

Property Type: Mixed-use with one 16 storey and one 11

storey rental residential towers (approx. 136,000 sf at

RioCan’s interest)

Commercial NLA: 22,000 sf at RioCan’s Interest

Project Start / Anticipated Completion: 2020/2023

Surfacing Value:

• Concert paid RioCan $26.3 million in June 2017 for a

50% interest in the development.

• RioCan acquired the centre in 2007 for $22.8 million

(100%)

• More than doubled the value in ten years, before

significant value creation upon this project’s

completion.

Proposed





UNLOCKING INTRINSIC VALUE


YONGE SHEPPARD CENTRE,

TORONTO, ON

Location: Located at the thriving intersection Yonge &

Sheppard, with access to 2 subway lines and highway 401

Property Type: Mixed-use with incremental 104k sf retail,

as well as 258k sf of rental residential at 100%

Ownership: 50% (JV with KingSett Capital)


Phased Completion: Retail – 2019

Residential – 2020


Surfacing Value

• Renovation and expansion of retail space

• Intensification through the addition of a new 39 storey

residential tower containing 258,000 square feet of

residential rental space

• Retail anchored by Longo’s, LA Fitness, Shoppers Drug

Mart, Winners, and three major banks

• LA Fitness took possession of their space in Q2 2018

46

Proposed• Demographics in 5km radius:




• 49,000 people pass through the site as part of their

daily commute

• $250M (at RioCan’s interest) renovation underway

Proposed

47

STRATEGIC PILLAR FOUR: STRATEGIC ACQUISITIONS


• Acquire only the best locations in the six

major markets

• Opportunities to acquire partners’ interests

in today’s tight market

• Highly selective acquisitions of

development sites, leveraging existing

properties


SELECTIVELY SEIZING OPPORTUNITIES

STRATEGIC ACQUISITIONSACQUISITIONS OF PARTNERS’ INTERESTS HAVE BEEN A KEY SOURCE OF GROWTH POST SALE OF US PORTFOLIO

48

Proposed

Acquired more than $1.5 Billion of assets predominantly in major markets that would

otherwise not be available in the market at a weighted average capitalization rate of 5.8%

• Acquisition from Kimco involved the purchase of a non-managing interest from a motivated seller seeking

to re-focus their portfolio in the United States.

Acquisitions from Kimco of $0.9B

Acquisitions from CPPIB of $0.3B

Acquisitions from other partners,

$0.2B

Over $1.5 Billion of Acquisitions from Partners 2015 - 2017

MIXED-USE DEVELOPMENT

49

Proposed

THE WELL TORONTO, ON



50

Proposed

• Demographics 5KM radius:



• Innovative, amenity rich design including a European inspired

food hall

• Office is targeted LEED platinum

• Teaming with Enwave for the first low-carbon resilient cooling

and heating option for the property and surrounding community

THE WELL,

TORONTO, ON

Location: 7.7 acre site situated at the gateway to

downtown Toronto, at Front and Spadina. Transit

oriented adjacent to the site of a proposed intercity

GO Train stop.

Ownership Structure:

Commercial: 50% (J.V. with Allied Properties REIT

Residential: 40% (J.V. Allied Properties REIT and

WNUF2*)

Residential Building 6: 50% (J.V. with Woodbourne )

Property Type: Mixed-use with ~500,000 sf retail, 1.1

M sf office and ~1,700 residential units (condo and

rental) at 100%


Estimated project completion:

Commercial - 2021, Residential Building 6 – 2022+

Estimated PUD Costs (RioCan’s interest):

$693.1M** net of sales proceeds from air rights

Building 6: $136.3M

*WNUF2 holds a 20% interest in the residential portion until the sale of air rights to Tridel and Woodbourne upon completion of the underground and podium structures . ** Total estimated project are net of estimated proceeds from air rights sales and include land costs measured at fair value of the land, soft and hard construction costs, external leasing costs, tenant inducements, construction and development management fees, and capitalized interest and other carrying costs, as well as capitalized development staff compensation and other expenses.



51

Proposed

THE WELL,

TORONTO ON

Leasing Status

• Lease agreements with:

• Shopify representing 433,752 sf of office GLA

• Index Exchange for 200,000 sf of office GLA

• Spaces for 125,000 sf of office GLA

• Office component is 71% leased

Surfacing Value

• RioCan and its partners acquired the former Globe and

Mail head office and surrounding land for $170 million in

2012 and 2013

• Agreement in place to sell 1.1M sf of air rights to

Residential partners Tridel and Woodbourne for

approximately $189 million upon completion of the

underground and podium structures

• Upon completion, an estimated 10,000 people will live

and work at the property

• A comprehensive signage master plan agreement has

been approved by the city. Interior and exterior digital

signage will generate significant ancillary revenue

Proposed



YORKVILLE, TORONTO, ON

Location: Transit oriented and in the heart of prestigious Yorkville, one of

Toronto’s most high-end shopping and residential areas.

Property Type: Mixed-use with potential for 0.5M sf of luxury condominium

and retail uses and up to up to 82 rental units

Ownership: 50/25/25 joint venture among RioCan, Metropia and Capital

Developments

Zoning Status: Preparing application for ZBA Zoning Bylaw Amendment

Project Start/Anticipated Completion: TBD

Surfacing Value:

• As of February 2018 the partners have completed acquisitions of

adjacent properties substantially required for the intensification project

• RioCan has agreed to purchase the partners’ interest in the retail

portion upon completion at a 6% cap rate and has the right of first

opportunity to acquire the residential rental units

52

• Demographics in 5 km radius:






53

Proposed

BATHURST COLLEGE

CENTRE, TORONTO

Location: Situated in the western downtown

corridor in Toronto, at Bathurst Street and College

Avenue. Directly across street from Toronto General

Hospital

Ownership Structure: 100%

Property Type: 141,000 sf mixed-use office and

retail

Leasing status: 100% leased

Anchor Tenants: University Health Network

(UHN), a high profile technology company, Fresh

Co (Sobeys), Winners, Bank of Nova Scotia


Project completion: 2018

Estimated PUD Costs (RioCan’s interest):

$109.7M

Proposed


54

Proposed

5th & THIRD,

CALGARY, AB

Location: Well located in the East Village area of

downtown Calgary with direct access to the LRT

Ownership Structure: 100% retail, Residential air

rights sold to Embassy BOSA

Property Type: Mixed-use with 161,000 sf of retail

and 597,000 sf residential sold as air rights

Lead Tenants : Loblaw’s City Market, Shoppers Drug

Mart

Leasing status: 70% pre-leased


Estimated project completion: 2021


Proposed

MIXED-USE DEVELOPMENTSTRATEGIC ACQUISITIONS

55



• Low leverage

• Low cost of debt

• Laddered debt maturity and mostly fixed rate

• Access to multiple sources of capital

• Large unencumbered assets pool generating

56.6% of annualized NOI


Strong Growth

Multiple Capital

Sources

Low Leverage

THE FINANCIAL RESOURCES TO FUEL GROWTH AND WEATHER MARKET TURMOIL

56

MEASURED APPROACH TO DEVELOPMENT

Max.

Permitted

As at

Sept. 30, 2018Target

Properties Under Development (“PUD”) & Inventory- $1.3 B N/A

PUD and Inventory as % of Gross Assets – per Line of Credit Covenant 15% 9.6% ~ 10%*

Investment in Greenfield Development and Inventory as % of Unitholder Equity

- per Declaration of Trust 15% 5.4% N/A

$1.3 Billion

$300M - $400M $300M - $600M

<$1.5 Billion*

* In 2018 and 2019, PUD and Inventory balance may exceed the target range of 10% of gross assets or over $1.5B on a quarterly basis before a few large projects (such as YENE condo and rental towers, Kingly, Bathurst & College) are completed in late 2018 and early 2019.

57


SELF FUNDING DEVELOPMENTNOT DEPENDENT ON EQUITY OFFERINGS OR INCREASING LEVERAGE

Sources of Funding for Development:

• Disposition net proceeds

• Sales proceeds from condominium/townhouse developments or air rights

sales

• Strategic alliances to reduce capital requirements and mitigate risks

• Excess operating cash flows

• Sale of marketable securities

58


PRUDENT MANAGEMENT OF DEVELOPMENT RISKS

• Laddered development

• Pre-leasing requirement for commercial development and sound market studies for

residential development

• Well-established internal control process for development approvals and

construction management

• Detailed working drawings and costing and utilize fixed price contracts as much as possible

• Strategic alliances to reduce capital requirements and mitigate risks

• Dedicated and experienced development team but not over-staffed

o No overhead pressure to take on projects

o Residential property management currently outsourced until we reach scale

• Already own the assets, which are income producing

o We can better control development starts especially in today’s environment of rising construction costs

• Limited condominium development

59


STRONG BALANCE SHEETPRUDENT CAPITAL MANAGEMENT & FLEXIBLE CAPITAL STRUCTURE

* Coverage and payout ratios calculated on a rolling 12 month basis

Capital Structure Metrics

Target Q3 2018*

Leverage 38% - 42% 42.4%

Debt/EBITDA <8.0x 7.79x

Interest Coverage >3.0x 3.72x

Debt Service Coverage >2.25x 3.09x

Fixed Coverage >1.10x 1.17x

Unencumbered Assets N/A $7.9B

Unencumbered Assets to Unencumbered Debt >2.0x 2.17x

NOI % from Unencumbered Assets >50% 56.6%

Unsecured vs. Secured Debt 60%/40% 59%/41%

FFO Payout Ratio <80% 78.0%

42.4%47.3%

3.1x

2.5x

7.8x

9.0x

Debt Service Coverage

Leverage

60

INDUSTRY LEADING FINANCIAL PROFILE

Source: company reports; Peers as at June 30, 2018 : CRR, CRT, FCR, CHP, SRU

3.7x

3.0x

Interest Coverage

Debt to EBITDA

61


INDUSTRY LEADING FINANCIAL PROFILECAPITAL STRUCTURE PROFILE: CANADA VS. U.S.

Historical Background and Stronger Demand for Yield:

o Canadian REITs have a shorter history and higher demand for yield

o US Retail REITs have much higher institutional ownership (~86%*)

Less Risky Retail Operating Environment

o Less retail space per capita in Canada

o Stricter development regulations and municipal bylaws in Canada

o Retail in Canada has less competition, more financially stable anchor tenants

More Conservative Lending Practices

o Canada: recourse borrowing and higher proportion of secured financing

o U.S.: Non-recourse borrowing and more reliance on unsecured financing

o Canadian financial institutions have more conservative, on-balance sheet

lending practices

62


CAPITAL MANAGEMENT STRATEGYPRUDENT CAPITAL MANAGEMENT & FLEXIBLE CAPITAL STRUCTURE

• Maintain strong balance sheet with leverage in the 38% - 42% range

• Maximize unit repurchases under NCIB subject to our leverage target

• Self-fund development

• Balance unsecured and secured debt ratio in the ~60/40 split range

• Maintain financial flexibility by managing revolving line of credit

utilization and balance between debenture issuance and line of credit

utilization

• Balance debt maturities and limit variable rate debt to manage interest

rate risk

• Maintain and develop lender relationships and continue to utilize

diversified funding sources

• Utilize CMHC funding for mixed-use residential properties

63

STAGGERED DEBT MATURITY AND LOW COST OF DEBTW

eig

hte

dA

vg. Interest R

ate on

Matu

ring D

ebt

3.78% 3.67%

3.24%3.47% 3.25% 3.47%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

0

400

800

1,200

1,600

2,000

2,400

2018 remainder 2019 2020 2021 2022 Thereafter

$ ‘000s

Scheduled principal amortization Mortgages payable

Floating Rate Mortgages and Lines of Credit Debentures payable

Weighted average interest rate

275

955 884 955

706

2,247

LESS IMPACTED BY RISING INTEREST RATES

CONTACT INFORMATION

64

Proposed

Proposed

Contact Information RioCan Yonge Eglinton Centre 2300 Yonge Street P.O. Box 2386 Toronto, ON M4P 1E4

Email: [email protected](T) 1-800-465-2733 or (416) 866-3033

management investor presentation third …...6 8.7% 26.2% 64.6% 3.7% 8.1% 17.8% 2006 2011 2017 2036...

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