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Be the first with the news that moves the market- RioCan REIT (TSX:REI.UN) has withdrawn its 2020 outlook and is reducing its planned 2020 spending, due to uncertainty surrounding the COVID-19 pandemic
- RioCan has delayed most of its early stage developments, reducing its planned 2020 expenditure budget by around C$125 million
- So far this month, the company has approved $15 million in deferred rent from its tenants, who are unable to pay due to the pandemic’s effects
- However, RioCan expects the deferred rent to be repaid within the next 14 months and believes its $1 billion in cash and available credit will be sufficient to weather the coming months
- RioCan REIT (REI.UN) is down 1.49 per cent, with shares trading for $15.16 and market cap of $4.84 billion.
RioCan REIT (TSX:REI.UN) has withdrawn its 2020 outlook and is reducing its spending, due to uncertainty surrounding the COVID-19 pandemic.
So far this month, the company has approved $15 million in deferred rent from its tenants, who are unable to pay due to the pandemic’s effects. This amounts to around 17 per cent of the company’s expected rent this month.
However, the company was quick to point that these deferrals are still required to be paid within the next 14 months.
While the company’s late stage construction activities remain ongoing, RioCan has delayed most of its early stage developments. By postponing these projects, the company has reduced its planned 2020 spending by around C$125 million.
Despite withdrawing the guidance, the company maintains that it is well positioned for an ongoing volatile market.
The company has $1 billion in cash and undrawn credit, and is refinancing its remaining mortgage payments, due in the second half of the year, to further strengthen its position.
CEO of RioCan, Ed Sonshine remains optimistic about the company’s future, despite its present challenges.
“We are in good financial health with a strong balance sheet and ample liquidity. Supported by our cycle-tested management team, RioCan is well-positioned to weather this storm and come out the other side poised to continue building our major market, urban mixed-use portfolio.
“We are already in the process of developing post-pandemic best practice protocols for our operations and developments once businesses and people’s daily lives start to go back to normal over time,” he said.
Ed went on to say that company’s focus remains on the health and safety of all of its employees and tenants, during these unprecedented times.
RioCan REIT (REI.UN) is down 1.49 per cent, with shares trading for $15.16 at 12:01pm EST.
