Choice Properties Real Estate Investment Trust, the primary tenant of which is Loblaw Cos. Ltd., said on Monday it was ready to assist small businesses and independent tenants eligible on a “case by case” basis with a temporary rent deferral of 60 days. The owner of CT Real Estate Investment Trust of Canadian Tire Corp. also said discussions have started with tenants for whom paying rent would “pose a significant challenge to their continued viability”.
“Many of these small businesses face extraordinary revenue declines and rightfully focus on taking care of their families and communities,” said Galen G. Weston, President of Choice Properties, Toronto-based, in a press release. “We intend to continue working with our tenants on an individual basis to find short-term solutions.” Weston is also the executive chairman of Loblaw.
Non-essential purchases have been closed across much of the country in an effort to stem the spread of the coronavirus, and IPF has been hit hard. CT REIT has lost 26% since the start of the year, although Choice Properties’ focus on grocery stores makes it the top performer in the FIT S & P / TSX capped index with a loss of 7%.
Choice, which owns 724 properties totaling 65.6 million square feet, primarily stores, industrial, office and residential assets, said it is withdrawing its outlook for 2020. The REIT plans to release its results for the first quarter of 2020 on or around April 22, 2020.
The company said it is well positioned to resist market volatility after strengthening its balance sheet since the start of 2019, including refinancing its unsecured debt.
CT REIT, which owns 350 properties covering 28 million square feet, said tenants representing about 6.2% of its basic annual minimum rent are currently neither open nor operational and that about 2.8% have not paid rent on April 1st. An additional 33.5%, of which 132 Canadian Tire stores in Ontario are now operating on a limited basis, the REIT said in a statement.
“We entered this crisis with a solid balance sheet, a 99.1% portfolio and a careful 75% payout rate,” said CT REIT CEO Ken Silver in the release. “We are committed to working with those of our tenants who need our support during these difficult times.”
The company said it was in a solid liquidity position with a carrying value of approximately 43% gross debt and approximately $ 300 million in unused credit facilities and cash as of December 31. CT REIT assets, with an IFRS value of approximately $ 6 billion, are 98% unused.