Paul Gardner, CFA RioCan Real Estate Investment REI.UN-T DON'T BUY Jul 31, 2018

Blue chip in shopping centre space. Growing footprint in residential. Will benefit from capital coming in to pay down debt. Internal growth is 3-4%. Good one to own going forward. Nice yield of 6%.

Exposed to rising interest rate payments on debt used to buy properties. Good yield is in competition with no-risk bonds. In the space he owns CAR.UN instead, which is multi-family housing.

Short term, he's constructive, likely more upside, a yield beneficiary. Medium term, might be one of the largest REITs in Canada, but one one of the smaller investors compared to pension plans, for example. Buying and developing assets is complex, expensive, and fraught with uncertainty. Fragile profile, despite good yield and recent rally.

Concerns over exposure to condo market. Great portfolio, quite defensive. He's bullish on outdoor shopping centre landscape across Canada, with low supply and increasing demand from population growth. Great management. You're well served by holding on.

Attractive level, high double-digit discount to NAV. Great portfolio. Multi-family residential portfolio is growing, may start selling it off and reallocating capital to retail or to share buybacks. Overhang: $600M worth of condos closing in next 3 years. Risk/reward is in your favour to buy here.

Value pick given current share price. Company beginning to find its way again. Returning back to core strengths of the business. Focus on urban centers very good idea. Management team is performing well. 

Still a REIT giant. Leads in the retail-focused, mixed-property use. Definitely impacted by The Bay situation. Retail weakness over next 6-12 months could be an issue.

Saw 96% retail occupancy in Q4, and 1.5% rental growth. Pressure from e-commerce. Issued debt in January to bolster balance sheet, debt is still manageable. Rate cuts could continue to spark leasing demand. Yield is 6%, cash machine for income lovers. Still reliable.

We think REI will be able to manage HBC's exit. The valuation is quite low at 9X cash flow, and, all things considered, the units have held up relatively well, down 6% YTD and up 2% in 52 weeks. The distribution was raised in February and payout is a decent 60%. We would not expect much from the sector, considering economic conditions, and minimal growth is expected (consensus). Still, this seems reflected in the valuation, and any good news would likely be quite positive to the stock. We would consider it 'OK', for income, overall. We are just not so sure this is a 'good' time to buy. 'Accumulate' slowly might be a better strategy.
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Cash flow per unit of 49c beat estimates of 45c; leasing spreads improved and same property net operating income rose. But it did take a $209M writedown on Hudson Bay and trimmed its guidance because of it (by 4c per unit). This hit offset benefits from its residential sector. The stock is down less than 1% which we would not consider abnormal. 
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Big fan. In general, no new retail properties have been developed. Increasing efficiency (reducing staff and selling apartment segment), focusing on core strengths (retail). Positive on ability to grow earnings for next few years.