RioCan Real Estate Investment Trust Announces Dissolution of JV With Cedar Realty Trust

RioCan Real Estate Investment Trust  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% owned by RioCan and 20% owned by Cedar). Under the terms of the dissolution, Cedar will convey its 20% portion owned in 21 properties to RioCan. RioCan will, in turn, convey its 80% 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.


Terms of the transaction:
The gross purchase price for the 20% interest in the 21 properties to be acquired by RioCan is $120 million, representing a capitalization rate of 6.5%. Under the terms of the transaction, RioCan will assume Cedar's share of the existing in place mortgage financing of $54.4 million, which carries an average interest rate of 5.2% and has an average term to maturity of 5.2 years. 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% interest in Franklin Village is $60 million.

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                                                         US$ Amount in '000s
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Purchase Price for 21 properties from Cedar              $119,521          
(based on a 6.5% capitalization rate)                                      
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Less Debt Assumed by RioCan from Cedar                   ($54,377)         
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Less mark to market debt adjustment                      ($750)            
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Net Purchase Price                                       $64,394           
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Sale price of RioCan's 80% interest in Franklin Village  $60,102           
(based on a 6.5% capitalization rate)                                      
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Less debt assumed by Cedar from RioCan                   ($34,696)         
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Cash to be paid by RioCan                                $38,988           
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"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 Chief Executive Officer 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% interest in 21 properties in the Northeastern US that were previously owned jointly with Cedar plus three properties where RioCan already owns a 100% 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 US 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,   -  Northland Centre, State College, 
  PA                                      PA                               
- Columbus Crossing, Philadelphia, PA  -  Northwoods Crossing, Taunton, MA 
- Creekview, Warrington (suburban      -  Pitney Road, Lancaster, PA       
  Philadelphia), PA                                                        
- Cross Keys Place, Turnersville       -  Shaw's Plaza, Raynham, MA        
  (suburban Philadelphia), NJ                                              
- Exeter Commons, Reading, PA          -  Stop N Shop Plaza, Bridgeport, CT
- Gettysburg Marketplace, Gettysberg,  -  Sunrise Plaza, Forked River, NJ  
  PA                                                                       
- Loyal Plaza, Williamsport, PA        -  Sunset Crossing, Dickson City, PA
- Marlboro Crossroads, Upper Marlboro, -  Town Square Plaza, Reading, PA   
  MD                                                                       
- 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% 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)

For further information, please refer to RioCan's website at www.riocan.com.

on September 7, 2012