TORONTO - RioCan Real Estate Investment Trust (TSX:REI.UN) says it has signed a joint-venture agreement with a U.S.-based property owner to acquire eight shopping centres in Texas for US$138 million.
RioCan said Thursday it will own 80 per cent of the properties —located in Dallas-Fort Worth, Houston and Austin — and Inland Western Retail Real Estate Trust Inc. will own the remaining 20 per cent.
The Canadian REIT said it will assume US$85.6 million of mortgage debt and will pay an additional $53 million. The properties total 1.2 million square feet and are 97 per cent occupied.
"This acquisition represents a great opportunity to expand RioCan's U.S. portfolio into a second geographic market with a partner that has an excellent market position within Texas," stated president and CEO Edward Sonshine.
"Texas has performed very well throughout this past recession, it is an important market and it has been one of the stronger regional economies in the U.S. This acquisition is an opportunity to further RioCan's investment strategy to acquire high-quality defensive assets in large and growing urban markets," he added.
RioCan has interests in 261 retail properties worth about $8.4 billion. In the last year, the Toronto company has been expanding into the United States.
Units in the REIT lost $1.03 or more than five per cent to $18.21 in Thursday trading on the Toronto Stock Exchange.[Free Press News]