Plazacorp Announces Year End Results and gets a $120 Million Increase in Asset Value from IFRS

Plazacorp Retail Properties Ltd. (TSXV:PLZ) announced its results for the year ended December 31, 2010 along with a $120 million increase in the valuation of its income producing properties, properties under development and surplus lands (collectively "investment properties") and equity-accounted investments at January 1, 2010, in accordance with its transition to International Financial Reporting Standards ("IFRS").

Plazacorp reported funds from operations ("FFO") of $13.1 million for the year ended December 31, 2010, compared to $13.4 million for the year ended December 31, 2009. FFO per share was $0.264 for the year ended December 31, 2010 ($0.264 per share diluted) compared to $0.279 per share for the year ended December 31, 2009 ($0.263 per share diluted). Although Plazacorp experienced an increase in net property operating income for the year, the increase was offset by an increase in administrative expenses, a decrease in investment income and increased interest expense.

Michael Zakuta, Plazacorp's President and CEO said, "We are pleased with the results for the year ended December 31, 2010. Upon transition to IFRS and the resulting fair value increase of Plazacorp's assets, our gross book value will better recognize the significant value creation that has been realized on behalf of Plazacorp's shareholders.

Plazacorp's summary of FFO for the three and twelve months ended December 31, 2010, compared to the three and twelve months ended December 31, 2009 is presented at www.plaza.ca


As required by the Canadian Accounting Standards Board (AcSB), Plazacorp will adopt IFRS in place of current Canadian generally accepted accounting principles ("GAAP") for interim and annual periods beginning on and after January 1, 2011, with comparative information for the previous fiscal years. Plazacorp's first reporting period under IFRS will commence with its interim financial statements for the three months ended March 31, 2011.

Plazacorp has adopted the fair value model under IFRS to value its investment properties (including those investment properties included within equity-accounted investments), with the initial increase in fair value on the transition date (January 1, 2010) being recorded in shareholders' equity and subsequent changes in fair value being recorded in the consolidated statements of comprehensive income.

The fair value of Plazacorp's investment properties and equity-accounted investments for its opening balance sheet at January 1, 2010 will increase by approximately $120 million over the historical cost amounts as currently reported under Canadian GAAP. Approximately $103 million of the increase relates to investment properties and approximately $17 million of the increase relates to equity-accounted investments. At January 1, 2010, the fair value of investment properties will be approximately $375 million, while the fair value of equity-accounted investments will be approximately $24 million. These amounts do not include any portfolio premium. The fair value of investment properties was determined using a weighted average capitalization rate of 8.2%.


Further details of Plazacorp's results and its transition to IFRS can be found in its Management's Discussion and Analysis included in its annual report for the year ended December 31, 2010. A copy of Plazacorp's annual report can be found on the Corporation's web site at www.plaza.ca or on SEDAR at www.sedar.com.
 

on April 6, 2011