Building Magazine


RioCan REIT dissolves their joint venture agreement with Cedar Realty Trust

RioCan REIT announced that it has entered into an agreement to dissolve its joint venture agreement with Cedar Realty Trust, Inc. Through its Limited Partnership Agreement dated December 10, 2009 RioCan and Cedar have amassed a portfolio of 22 properties that are owned on an 80/20 basis (80 percent owned by RioCan and 20 per cent owned by Cedar). Under the terms of the dissolution, Cedar will convey its 20 per cent portion owned in 21 properties to RioCan who will, in turn, convey its 80 per cent interest in Franklin Village to Cedar. RioCan continues to hold 9.4 million shares of Cedar and has relinquished its right to a seat on Cedar’s Board of Directors.

The gross purchase price for the 20 per cent interest in the 21 properties to be acquired by RioCan is $120 million. RioCan’s purchase price is to be reduced by $750,000 to reflect a mark-to-market adjustment to the assumed financing. The gross sale price of the 80 per cent interest in Franklin Village is $60 million.

“RioCan has benefited greatly from our joint venture with Cedar. In less than three years, through the hard work of our partnership, we have amassed an exceptional portfolio of 25 retail assets in the northeastern United States,” said Edward Sonshine, CEO of RioCan. “Cedar has played an integral role in the acquisition of these assets, as well as their leasing and management. While RioCan’s objective is maintaining its growth trajectory in the northeastern United States through acquisitions, Cedar is seeking to consolidate its portfolio. Given these diverging objectives, both parties have agreed that the dissolution of our joint venture is the sensible path to take. We are pleased that Cedar is maintaining its management position of these assets for the near future, while we finalize alternative arrangements.”

Once completed, RioCan will own a 100 per cent interest in 21 properties in the Northeastern U.S. that were previously owned jointly with Cedar plus three properties where RioCan already owns a 100 per cent interest. Under the terms of the agreement, Cedar will continue to provide property management services for a period of up to one year, cancelable on 90 days notice, under similar terms as the property management services currently provided by Cedar. RioCan’s total portfolio in the northeastern U.S. will include 25 properties totalling 5.3 million square feet (including shadow anchors) in the states of Connecticut, New Hampshire, New Jersey, New York, Massachusetts, Maryland, Pennsylvania, and Virginia.

Properties to be acquired from Cedar:

  • Blue Mountain Commons, Harrisburg, PA
  • Northland Centre, State College, PA
  • Columbus Crossing, Philadelphia, PA
  • Northwoods Crossing, Taunton, MA
  • Creekview, Warrington (suburban Philadelphia), PA
  • Pitney Road, Lancaster, PA
  • Cross Keys Place, Turnersville (suburban Philadelphia), NJ
  • Shaw’s Plaza, Raynham, MA
  • Exeter Commons, Reading, PA
  • Stop N Shop Plaza, Bridgeport, CT
  • Gettysburg Marketplace, Gettysberg, PA
  • Sunrise Plaza, Forked River, NJ
  • Loyal Plaza, Williamsport, PA
  • Sunset Crossing, Dickson City, PA
  • Marlboro Crossroads, Upper Marlboro, MD
  • Town Square Plaza, Reading, PA
  • Monroe Marketplace, Selinsgrove, PA
  • Towne Crossing SC, Richmond, VA
  • Montville Commons, Montville, CT
  • York Marketplace, York, PA
  • New River Valley, Christianburg, PA

Additional properties owned 100 per cent by RioCan where Cedar will continue to provide property management services:

  • Huntington Square, East Northport, NY
  • Shoppes at Salem, Salem, NH
  • Super Stop & Shop Plaza, Richmond, RI
  • Deptford Landing, Depford, New Jersey (currently under contract)

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