Retail Market Overview

Retail Market Overview
April 2011
Spread: REIT Index vs. GoC Bond Yields
Date
Spread
Market Cap
June 13, 2007
40 bps
$24.5 bln
March 9, 2009
1,054 bps
$13.4 bln
Current
215 bps
$27.0 bln
Average
326 bps
$15.4 bln
$30
16.0
14.0
$25
12.0
$20
10.0
$15
8.0
6.0
$10
4.0
$5
2.0
$-
Source: Bloomberg
0.0
Market Cap
Yield
GoC 10 Year Bond Yield
Yield (%)
Market Capita
alization, C$ b
billions
S&P/TSX REIT Index
I d – Market
M k C
Capitalization
i li i and
d Spread
S
d over GoC
G C 10-Year
10 Y
Spread: REIT Index vs. GoC Bond Yields vs. Retail REITs
$16
16.0%
$14
14.0%
$
$12
12.0%
$10
10.0%
$8
8.0%
$6
6 0%
6.0%
$4
4.0%
$2
2.0%
$-
Yield (%)
Y
Market Capittalization, C$ b
billions
 The weighted-average Retail REIT yield has closely followed the REIT Index yield over the
past 5 years
0.0%
Retail REITs Market Cap
Source: Bloomberg
REIT Index Yield
GoC 10 Year Bond Yield
Weighted-Average Retail REIT Yield
Retail Sales per Capita
 Retail sales per capita in Quebec reached $12,514 in 2010 (+4.51% YoY)
 Canadian retail sales climbed to $12,802 in 2010 (+4.45% YoY)
$13 500
$13,500
$13,000
$12,500
$12,000
$11,500
$11,000
$10,500
$10,000
2006
2007
Quebec Retail Sales Per Capita
Source: The Conference Board of Canada, FP Markets
2008
2009
2010
Canadian Retail Sales Per Capita
2011f
Retail Area per Capita
Sq. Ft.
Ottawa
6.7
Calgary
10.7
Vancouver
13.6
Montreal
4.8
Toronto
9.1
Canada
7.5
120,000
14.2%
14.0%
100,000
Total Sq. Ft. (000s)
13.8%
80,000
13.6%
60,000
13.4%
13.2%
40,000
13.0%
20,000
12.8%
-
12.6%
2006
2007
Ottawa
Calgary
2008
Vancouver
2009
Montreal
2010
Toronto
2011f
% Montreal of Canada
Source: The Conference Board of Canada, Statistics Canada, CSCA, CB Richard Ellis, McGraw-Hill/CBRE-EA Pipeline, Rogers Media (2010 Canadian
Directory of Shopping Centres
Montreal Retail Sq. Ftt. as % of Nationa
al
Total Retail GLA
The Return of Liquidity
 The seven retail focused public entities have raised $3.32B since January 2010
 49% of total $6.72B* Canadian REIT issuances since January 2010
Issuance Activity ($000s) – January 2010 to Present
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$-
Debt Offering
Source: Bloomberg
* Including First Capital Realty
Equity Offering
Canadian Capitalization Rate by Asset Class
10.0%
Downtown Class ‘AA” Office
9.0% at the Peak in Q1/2000
6 1% at its Lowest in Q3/2007
6.1%
9.5%
9.0%
Industrial
9.6% at the Peak in Q1/2000
6.5% at its Lowest in Q2/2007
8.5%
8.0%
7.5%
7.0%
6.5%
Regional Malls
8.4% at the Peak in Q1/2000
5.7% at its Lowest in Q2/2007
6 0%
6.0%
5.5%
5 0%
5.0%
Source: Altus InSite
Suburban Multi-Res
7.9% at the Peak in Q1/2000
5.8% at its Lowest in Q4/2007
Major Recent Retail Transactions
Place Portobello, Brossard
Date:
March 2011
Vendor:
El Ad Canada Inc
Purchaser:
First Capital Realty
Area (sq. ft.):
504,084 sq. ft.
Major Tenants:
Zellers, Reno Depot, Maxi
Purchase Price:
$72.00 MM
Cap Rate:
7.0%
Place Longueuil,
Longueuil Longueuil
Date:
February 2011
Vendor:
El Ad Canada Inc
Purchaser:
Homburg REIT
Area (sq. ft.):
573,388 sq. ft.
Major Tenants:
Zellers, IGA
Purchase Price:
$78.64 MM
Cap Rate:
7.3%
Major Recent Retail Transactions
Carrefour Les Saules, Québec
Date:
March 2011
Vendor:
El-Ad Canada
Purchaser:
Homburg REIT
Area (sq. ft.):
159,138 sq. ft.
Major Tenants:
Maxi, Hart
Purchase Price:
$11.65 MM
Cap Rate:
8.4%
L Halles
Les
H ll de
d L’ÎIe,
L’ÎI Nuns’
N
’ Island
I l d
Date:
February 2011
Vendor:
El Ad Canada
Purchaser:
Homburg REIT
Area (sq. ft.):
16,650 sq. ft.
Purchase Price:
$5.71 MM
Cap Rate:
7.7%
Major Recent Retail Transactions
Galeries de la Capitale, Lebourgneuf
Date:
September 2010
Vendor:
Osmington
Purchaser:
CPPIB
Area (sq. ft.):
1,500,000 sq. ft.
Major Tenants:
Sears, Zellers, Simons, Imax
Purchase Price:
Undisclosed
Interest Sold:
10%
Cap Rate:
6.5%
O il
Ogilvy,
Montreal
M t
l
Date:
July 2010
Vendor:
Pyxis Real Estate Equities Inc.
Purchaser:
Private
Area (sq. ft.):
167,614 sq. ft.
Major Tenants:
Ogilvy
Purchase Price:
$67.76 MM
Cap Rate:
7.0%