REI.UN

RioCan Real Estate Investment Trust (“RioCan" or the "Trust”) announced today its financial results for the three months and year ended December 31, 2021 (the "Fourth Quarter").

"In 2021, RioCan delivered strong results demonstrating once again the quality of our portfolio, the resilience of our tenants and the talent of our people. The critical nature of our centres has been emphasized through the merger of physical and online retail. Tenants continued to seize the opportunity to lease our well-located space and our development pipeline remained on track to deliver new and dynamic space," said Jonathan Gitlin, President and CEO of RioCan. "Having proven our ability to execute in the face of unprecedented challenges, we maintain our focus on our long-term strategy to maximize the value of our portfolio and grow our business. The distribution increase announced today is a clear indication of our confidence in our people, our assets and our strategy, which will deliver sustainable growth and robust returns for our Unitholders."

	Three months endedDecember 31									Years ended December 31
(in millions, except where otherwise noted, and per unit values)			2021				2020				2021				2020
Financial Highlights
Net income (loss)		$	208.8			$	65.6			$	598.4			$	(64.8	)
Weighted average Units outstanding - diluted (in thousands)			315,733				317,739				317,284				317,725
FFO 1		$	146.5			$	124.1			$	507.0			$	507.4
FFO (excluding net debt prepayment costs and one-time compensation costs) 1		$	150.4			$	124.1			$	524.0			$	507.4
FFO per unit - diluted 1		$	0.46			$	0.39			$	1.60			$	1.60
FFO per unit (excluding net debt prepayment costs and one-time compensation costs) - diluted 1		$	0.48			$	0.39			$	1.65			$	1.60

FFO per Unit and Net Income

• FFO per unit of $0.46 for the quarter was $0.07 per unit or 18% higher than the same period last year of which $0.02 per unit was driven by Same Property NOI1 and $0.01 per unit contributed by NOI from completed properties under developments1. The remaining $0.04 per unit increase was due to higher residential inventory gains of $22.8 million, mainly from selling a 75% interest in the condominium component of Leaside Centre mixed-use project in Toronto, partially offset by a reduction in NOI from properties sold1 of $5.1 million, lower lease cancellation fees of $4.8 million and debt prepayment costs of $3.9 million.
• FFO per unit for the year was $1.60, unchanged from the prior year, and included increases of $0.06 per unit driven by Same Property NOI and $0.02 per unit of NOI from completed development projects. This was partially offset by a reduction in NOI from commercial properties sold of $0.03 per unit, debt prepayment costs of $0.03 per unit and one-time compensation costs of $0.02 per unit. The $12.9 million increase in residential inventory gains in the year was mostly offset by $11.1 million lower realized gains on the sale of marketable securities and dividend income.
• Net income for the year and Fourth Quarter was $598.4 million and $208.8 million and exceeded the comparable periods last year by $663.2 million and $143.2 million, respectively, mainly due to fair value gains of $124.1 million and $72.3 million recognized in 2021, compared to fair value losses of $526.8 million and $42.3 million in 2020.

1. A non-GAAP measurement. For definitions, reconciliations and the basis of presentation of RioCan's non-GAAP measures, refer to the Basis of Presentation and Non-GAAP Measures section in this News Release.

Distributions

• RioCan's Board of Trustees has approved an increase to the monthly distributions to Unitholders of 6.25% to $0.085 cents per unit commencing with the February 2022 distribution, payable on March 7, 2022 to Unitholders of record as at February 28, 2022. This increase brings RioCan's annualized distribution to $1.02 per unit. The Trust's objectives include providing sustainable distribution increases supported by FFO per unit growth while maintaining a FFO Payout Ratio1 of approximately 55% to 65% over the long-term. This enables us to provide a growing income stream to our Unitholders while retaining the cash flow required to fund future growth. With a FFO per unit growth target of 5% to 7% for 2022, the Trust expects to achieve its payout ratio objective.

Progress at The Well

• Solid progress continued on The Well™, with the construction of the commercial component, which includes office and retail, at approximately 82% complete, excluding fixturing. Retail leasing has gained momentum and, as of February 9, 2022, approximately 50% of the retail space has firm leases with that number increasing to 62% when including leases in advanced discussions with tenants. Grand opening of the retail component is expected in the spring of 2023. As of February 9, 2022, 90% of the office component of the space is leased and 638,000 square feet was handed over to tenants for fixturing with first cash rents to start in the second half of 2022. The purpose-built residential rental building, FourFifty The Well™, is also advancing as planned and is expected to be complete in 2023.

Capital Recycling

• In 2021, the Trust completed $848.6 million of dispositions at a weighted average capitalization rate of 3.75%, a testament to the quality and demand for the Trust's assets.
• As of February 9, 2022, the Trust has firm or conditional deals that were in-place at or entered into after year end and deals that closed subsequent to year end to sell full or partial interests in a number of properties totaling $98.0 million.

Capital Management Update

• In 2021, the Trust advanced it's objectives to have 70% of total debt unsecured and to extend the weighted average term to maturity of its total debt portfolio.
• On November 8, 2021, RioCan issued $450.0 million, 2.829% of Series AE senior unsecured green bond debentures with a seven-year term.
• On November 30, 2021, RioCan redeemed, in full, its $250.0 million, 3.746% Series V unsecured debentures due May 30, 2022 in accordance with their terms, at a total redemption price of $253.8 million.
• The Trust also prepaid $344.5 million of mortgages and unwound the associated interest rate swap hedges for a net prepayment cost of $0.1 million.  An additional $41.0 million mortgage was repaid on the disposition of Kennedy Commons. In total, $385.5 million of mortgages were repaid in the quarter.
• On December 14, 2021, the Trust entered into $300.0 million of bond forward contracts maturing on September 15, 2022 and subsequent to year end, entered into an additional $200.0 million of bond forwards maturing on April 28, 2022. These bond forward contracts are a hedge of the Trust's exposure to movements in underlying risk-free interest rates associated with the anticipated refinancing of the $300.0 million Series Y debentures maturing on October 3, 2022 and future anticipated financings, respectively.
• During the Fourth Quarter, the Trust acquired and cancelled 7,973,045 units at a weighted average purchase price of $22.32 per unit, for a total cost of $178.1 million.
• To provide additional financial liquidity, subsequent to year end on February 2, 2022, the Trust increased the credit limit on its revolving unsecured operating line of credit by $250.0 million to $1.3 billion.

1. A non-GAAP measurement. For definitions, reconciliations and the basis of presentation of RioCan's non-GAAP measures, refer to the Basis of Presentation and Non-GAAP Measures section in this News Release.

Operation Highlights

	Three months endedDecember 31									Years ended December 31
		2021				2020				2021				2020
Operation Highlights (i)
Occupancy - committed (ii)		96.8	%			95.7	%			96.8	%			95.7	%
Blended leasing spread		4.6	%			3.8	%			6.3	%			5.0	%
New leasing spread		3.8	%			5.1	%			8.6	%			7.9	%
Renewal leasing spread		5.0	%			3.6	%			5.4	%			4.4	%
Rent collection (iii)		98.6	%			96.2	%			98.0	%			94.4	%

(i)	Includes commercial overall portfolio only.
(ii)	Information presented as at respective periods then ended.
(iii)	Represents percentage of total billed gross rents for the Fourth Quarter and three quarters of 2020 which has been collected in cash as of February 9, 2022. Year ended December 31, 2020 includes billed gross rents for the period from April 1, 2020 to December 31, 2020.

• Same Property NOI grew by 4.9% in Q4 2021 when compared to the same period last year. Same Property NOI excluding the pandemic-related provision1 was positive at 1.0%. RioCan collected 98.6% of billed gross rents for Q4 2021, which resulted in the pandemic-related provision falling from $9.0 million in Q4 2020 to $2.9 million in the Fourth Quarter. Same Property NOI for full year 2021 grew by 3.4% despite the one quarter of pre-pandemic results included in 2020. The pandemic-related provision for the year fell from $42.5 million in 2020 to $17.2 million in 2021 despite the significant impact lockdowns had on our tenants throughout the year.
• Committed occupancy for the total portfolio of 96.8% showed solid improvement, increasing by 40 basis points when compared to Q3 2021. Retail committed occupancy ended the year at 97.2% and in the Greater Toronto Area jumped by 80 bps in Q4 2021, fuelling a 50 basis point increase in total portfolio retail committed occupancy. Committed occupancy for the total portfolio climbed steadily throughout 2021 from strong demand for our prime locations resulting in a 110 basis point year-over-year increase.
• New and renewed leases totalled 4.7 million square feet (at 100% ownership interest) for the year at a blended leasing spread of 6.3%. New leasing of 1.7 million square feet exceeded pre-pandemic levels at new leasing spreads for the overall portfolio of 8.6%. Renewed leases of 3.0 million square feet were completed at renewal leasing spreads of 5.4%, for the overall portfolio.

1. A non-GAAP measurement. For definitions, reconciliations and the basis of presentation of RioCan's non-GAAP measures, refer to the Basis of Presentation and Non-GAAP Measures section in this News Release.

RioCan Living Update

Residential Rental Buildings in Operation		Number oftotal units			Date oflease launch			% of leased unitsas ofFebruary 9, 2022				% of leased unitsas ofNovember 9, 2021
Stabilized (i)
eCentral (Yonge Eglinton Northeast Corner, Toronto)		466			December 2018			95.9	%			92.5	%
Frontier (Ottawa)		228			May 2019			95.6	%			97.4	%
Brio (Brentwood Village, Calgary)		163			April 2020			93.8	%			97.5	%
Market (Montreal) (ii)		139			December 2020			97.1	%			n/a
In lease-up
Pivot (Yonge Sheppard Centre, Toronto)		361			October 2020			84.8	%			72.0	%
Litho. (Toronto)		210			July 2021			61.9	%			37.1	%
Latitude (Ottawa)		209			July 2021			27.4	%			16.8	%
Strada (Toronto)		61			November 2021			27.9	%			—	%
Condominium Projects in Pre-construction (iii)		Number oftotal units			Date ofsales launch			% of pre-sold unitsreleased as ofFebruary 9, 2022				% of pre-sold unitsreleased as ofNovember 9, 2021
U.C. Towns 2, Oshawa, ON		65			August 2021			100.0	%			100.0	%
U.C. Tower 2, Oshawa, ON (iv)		993			August 2021			89.6	%			78.4	%
Queen & Ashbridge, Toronto, ON		399			September 2020			95.4	%			95.1	%
Verge (Phase One), Toronto, ON (iv)		197			July 2021			97.3	%			96.0	%
Verge (Phase Two), Toronto, ON (iv)		335			October 2021			94.6	%			88.4	%

(i)	A property is considered to have reached stabilization the earlier of (i) achieving 95% occupancy or (ii) 24 months after first occupancy.
(ii)	Market Phase One was acquired on February 8, 2022.
(iii)	Excludes a total of 1,194 condominium units under construction at the 11 YV, U.C. Uptowns and U.C. Tower projects and 48 units in interim occupancy at U.C. Uptowns.
(iv)	For U.C. Tower 2 (Phase One), Verge (Phase One) and Verge (Phase Two) only 606, 184 and 276 of the number of total units have been released for sale, respectively. The second phase of U.C. Tower 2 is expected to be released for sale in April 2022.

• As of February 9, 2022, the Trust's residential rental portfolio, overseen by RioCan Living™, is comprised of 1,698 purpose-built completed units (at 100% ownership interest) across seven buildings located in Toronto, Ottawa and Calgary. The portfolio includes the recent completion of two multi-unit properties, Latitude™, the 209-unit project in Ottawa and Strada™, the 61-unit project in Toronto. Occupancy at these two buildings commenced in Q1 2022. Leasing velocity in all new properties in the start-up leasing phase was strong. Litho™ is now at 61.9% leased, up 24.8% since last reported, and Strada, which launched in November of 2021, is already 27.9% leased.
• On February 8, 2022, the Trust acquired a 90% interest in the first phase of Market, a new apartment complex in Montreal, for a purchase price of $46.8 million at a 4.06% capitalization rate. The building contains 139 income producing residential rental units. RioCan will also acquire a 90% interest in 297 units in two additional phases under construction upon stabilization at a 4.16% capitalization rate. Financing of the acquisitions will be a combination of asset level mortgages and existing liquidity.
• During the Fourth Quarter, RioCan sold a 75% interest in the condominium component of RioCan Leaside Centre mixed-use project to a joint venture partner for sale proceeds of $54.4 million, representing approximately $145 per square foot of 0.4 million square feet of future density, and recognized $25.3 million of inventory gains. RioCan owns 100% of the remaining development including approximately 0.6 million square feet of multi-use residential and 0.2 million square feet of commercial space. RioCan Leaside Centre in Toronto will be transformed into a 1.2 million square foot mixed-use community with a light rail transit station situated on the site.

Development Highlights

	Three months endedDecember 31									Years endedDecember 31
(in millions except square feet)			2021				2020				2021				2020
Development Highlights
Development Completions - sq. ft. in thousands			86.0				320.0				243.0				529.0
Development Spending1		$	93.8			$	141.4			$	427.5			$	493.4
Under Active Development - sq. ft. in thousands (i)(ii)			2,082.0				2,439.0				2,082.0				2,439.0

(i)	Information presented as at respective periods then ended and includes properties under development and residential inventory.
(ii)	For 2021, excludes a total of 1.5 million square feet of completed phases and air rights sold (2020 - 1.4 million square feet).

• RioCan's in-house development team delivered 243,000 square feet of completions during 2021, including Litho., retail space at Windfields Farm in Oshawa, Lincoln Fields Shopping Centre in Ottawa and RioCan Shawnessy in Calgary. The total embedded development potential within the Trust's portfolio is 43.1 million square feet of which 21.0 million square feet are currently zoned or have submitted applications.
• Our development pipeline includes 13.8 million square feet of permitted projects of which 2.1 million square feet is currently under development. Construction projects include The Well, as discussed earlier in this release, and two residential rental projects in Ottawa, Luma™ and Rhythm™, which are on schedule for completion by Q2 2022 and Q4 2022, respectively.
• The Trust's Development Spending target for 2022 is estimated to be in the $475 million to $525 million range. In 2022, the Trust expects to deliver projects with cost of $675 million to $725 million, the largest amount of annual cost transfers since the inception of this development program.

Balance Sheet Strength

(in millions except percentages) As at						December 31, 2021					December 31, 2020
Balance Sheet Strength Highlights
Total assets							$	15,177				$	15,268
Total debt							$	6,611				$	6,928
Liquidity (i) 1							$	1,010				$	1,577
Adjusted Debt to Adjusted EBITDA (i) 1							9.59x					9.47x
Total Adjusted Debt to Total Adjusted Assets (i) 1								43.9	%				45.0	%
Ratio of Unsecured Debt and Secured Debt (i) 1							59.4% / 40.6%					57.2% / 42.8%
Unencumbered Assets (i) 1							$	9,392				$	8,727
Unencumbered Assets to Unsecured Debt (i) 1								231	%				215	%

(i)	At RioCan's proportionate share.

• The Trust ended 2021 with $1.0 billion of Liquidity in the form of cash and cash equivalents and undrawn lines of credit, increasing to $1.3 billion after accounting for the increase in the unsecured operating line of credit on February 2, 2022.
• RioCan’s unencumbered asset pool was $9.4 billion, which generated 64.9% of Annual Normalized NOI1 and provided 2.31x coverage over Unsecured Debt. This pool increased from the prior year as the Trust proactively repaid mortgages.
• The Trust's Total Adjusted Debt to Total Adjusted Assets at RioCan's proportionate share improved from December 31, 2020 mainly due to year-over-year decrease of $239.9 million in proportionate total debt balances at the current year end as the Trust has utilized proceeds from asset sales to reduce debt over the course of 2021.
• Adjusted Debt to Adjusted EBITDA was 9.59x on a proportionate share basis, as at December 31, 2021. The increase in Adjusted Debt to Adjusted EBITDA from prior year end was primarily due to the net impact of higher average Total Adjusted Debt balances, as debt was used to fund development, partially offset by higher Adjusted EBITDA. This ratio has improved since Q3 2021 as Adjusted EBITDA has continued to improve.

1. A non-GAAP measurement. For definitions, reconciliations and the basis of presentation of RioCan's non-GAAP measures, refer to the Basis of Presentation and Non-GAAP Measures section in this News Release.

Conference Call and Webcast

Interested parties are invited to participate in a conference call with management on Thursday, February 10, 2022 at 10:00 a.m. (ET). Participants will be required to identify themselves and the organization on whose behalf they are participating.

In order to participate, please dial 647-427-3230 or 1-877-486-4304. For those unable to participate in the live mode, a replay will be available at 1-855-859-2056, passcode 5956476#.

For a copy of the slides to be used for the conference call or to access the simultaneous webcast, visit RioCan’s website at http://investor.riocan.com/investor-relations/events-and-presentations/ and click on the link for the webcast.

About RioCan

RioCan is one of Canada’s largest real estate investment trusts. RioCan owns, manages and develops retail-focused, increasingly mixed-use properties located in prime, high-density transit-oriented areas where Canadians want to shop, live and work. As at December 31, 2021, our portfolio is comprised of 207 properties with an aggregate net leasable area of approximately 36.4 million square feet (at RioCan's interest) including office, residential rental and 13 development properties. To learn more about us, please visit www.riocan.com.

Basis of Presentation and Non-GAAP Measures

All figures included in this News Release are expressed in Canadian dollars unless otherwise noted. RioCan’s annual audited consolidated financial statements ("2021 Annual Consolidated Financial Statements") are prepared in accordance with International Financial Reporting Standards (IFRS). Financial information included within this News Release does not contain all disclosures required by IFRS, and accordingly should be read in conjunction with the Trust's 2021 Annual Consolidated Financial Statements and MD&A for the three months and year ended December 31, 2021, which is available on RioCan's website at www.riocan.com and on SEDAR at www.sedar.com. 

Consistent with RioCan’s management framework, management uses certain financial measures to assess RioCan’s financial performance, which are not in accordance with generally accepted accounting principles (GAAP) under IFRS. Funds From Operations (“FFO”) and FFO (excluding net debt prepayment costs and one-time compensation costs), FFO per unit and FFO per unit (excluding net debt prepayment costs and one-time compensation costs), Net Operating Income ("NOI"), Same Property NOI, Development Spending, Total Contractual Debt, Liquidity, Adjusted Debt to Adjusted EBITDA, Total Adjusted Debt to Total Adjusted Assets, RioCan's Proportionate Share, Unsecured Debt, Secured Debt, Unencumbered Assets to Unsecured Debt and Percentage of Normalized NOI Generated from Unencumbered Assets, as well as other measures that may be discussed elsewhere in this News Release, do not have a standardized definition prescribed by IFRS and are, therefore, unlikely to be comparable to similar measures presented by other reporting issuers. RioCan supplements its IFRS measures with these Non-GAAP measures to aid in assessing the Trust’s underlying performance and reports these additional measures so that investors may do the same. Non-GAAP measures should not be considered as alternatives to net earnings or comparable metrics determined in accordance with IFRS as indicators of RioCan’s performance, liquidity, cash flow, and profitability. For full definitions of these measures, please refer to the "Non-GAAP Measures” section in RioCan’s MD&A for the three months and year ended December 31, 2021.

The reconciliations for each non-GAAP measure included in this News Release are outlined as follows:

RioCan's Proportionate Share

The following table reconciles the consolidated balance sheet from IFRS to RioCan's proportionate share basis as at December 31, 2021 and 2020:

As at	December 31, 2021									December 31, 2020
(in thousands)	IFRS basis			Equity-accounted investments			RioCan'sproportionateshare			IFRS basis			Equity-accounted investments			RioCan'sproportionateshare
Assets
Investment properties	$	14,021,338		$	409,794		$	14,431,132		$	14,063,022		$	243,677		$	14,306,699
Equity-accounted investments		327,335			(327,335	)		—			209,676			(209,676	)		—
Mortgages and loans receivable		237,790			—			237,790			160,646			—			160,646
Residential inventory		217,043			121,291			338,334			214,181			82,331			296,512
Assets held for sale		47,240			—			47,240			198,094			—			198,094
Receivables and other assets		248,959			35,367			284,326			183,633			28,202			211,835
Cash and cash equivalents		77,758			9,113			86,871			238,456			2,203			240,659
Total assets	$	15,177,463		$	248,230		$	15,425,693		$	15,267,708		$	146,737		$	15,414,445
Liabilities
Debentures payable	$	2,990,692		$	—		$	2,990,692		$	3,340,278		$	—		$	3,340,278
Mortgages payable		2,334,016			166,368			2,500,384			2,797,066			108,337			2,905,403
Lines of credit and other bank loans		1,285,910			48,049			1,333,959			790,539			28,716			819,255
Accounts payable and other liabilities		655,501			33,813			689,314			604,852			9,684			614,536
Total liabilities	$	7,266,119		$	248,230		$	7,514,349		$	7,532,735		$	146,737		$	7,679,472
Equity
Unitholders’ equity		7,911,344			—			7,911,344			7,734,973			—			7,734,973
Total liabilities and equity	$	15,177,463		$	248,230		$	15,425,693		$	15,267,708		$	146,737		$	15,414,445

The following tables reconcile the consolidated statements of income (loss) from IFRS to RioCan's proportionate share basis for the three months and years ended December 31, 2021 and 2020:

	Three months ended December 31, 2021									Three months ended December 31, 2020
(in thousands)	IFRS basis			Equity-accounted investments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Revenue
Rental revenue	$	266,899		$	7,071		$	273,970		$	276,422		$	4,300		$	280,722
Residential inventory sales	65,620			965			66,585			4,712			831			5,543
Property management and other service fees	3,920			—			3,920			4,050			—			4,050
	336,439			8,036			344,475			285,184			5,131			290,315
Operating costs
Rental operating costs
Recoverable under tenant leases	93,346			588			93,934			95,452			400			95,852
Non-recoverable costs	9,019			609			9,628			14,995			331			15,326
Residential inventory cost of sales	39,286			289			39,575			1,143			270			1,413
	141,651			1,486			143,137			111,590			1,001			112,591
Operating income	194,788			6,550			201,338			173,594			4,130			177,724
Other income (loss)
Interest income	3,842			566			4,408			3,500			347			3,847
Income from equity-accounted investments	6,503			(6,503		)	—			421			(421		)	—
Fair value gain (loss) on investment properties, net	72,255			1,480			73,735			(42,286		)	(2,852		)	(45,138		)
Investment and other income (loss)	(696		)	(144		)	(840		)	967			(19		)	948
	81,904			(4,601		)	77,303			(37,398		)	(2,945		)	(40,343		)
Other expenses
Interest costs, net	42,403			1,819			44,222			44,841			1,173			46,014
General and administrative	11,924			16			11,940			12,941			10			12,951
Internal leasing costs	2,982			—			2,982			2,901			—			2,901
Transaction and other costs	6,779			114			6,893			1,510			2			1,512
Debt prepayment costs, net	3,896			—			3,896			—			—			—
	67,984			1,949			69,933			62,193			1,185			63,378
Income before income taxes	$	208,708		$	—		$	208,708		$	74,003		$	—		$	74,003
Current income tax recovery	(68		)	—			(68		)	(711		)	—			(711		)
Deferred income tax expense	—			—			—			9,105			—			9,105
Net income	$	208,776		$	—		$	208,776		$	65,609		$	—		$	65,609

	Year ended December 31, 2021									Year ended December 31, 2020
(in thousands)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Revenue
Rental revenue	$	1,066,562		$	26,836		$	1,093,398		$	1,090,732		$	17,162		$	1,107,894
Residential inventory sales	93,727			6,474			100,201			36,347			6,718			43,065
Property management and other service fees	14,772			—			14,772			16,584			—			16,584
	1,175,061			33,310			1,208,371			1,143,663			23,880			1,167,543
Operating costs
Rental operating costs
Recoverable under tenant leases	367,297			2,089			369,386			377,787			1,495			379,282
Non-recoverable costs	40,753			2,544			43,297			64,751			1,599			66,350
Residential inventory cost of sales	65,346			2,371			67,717			20,842			3,567			24,409
	473,396			7,004			480,400			463,380			6,661			470,041
Operating income	701,665			26,306			727,971			680,283			17,219			697,502
Other income (loss)
Interest income	13,666			2,160			15,826			14,602			1,383			15,985
Income from equity-accounted investments	19,189			(19,189		)	—			3,985			(3,985		)	—
Fair value gain (loss) on investment properties, net	124,052			(1,113		)	122,939			(526,775		)	(9,613		)	(536,388		)
Investment and other income (loss)	2,743			(806		)	1,937			8,216			(166		)	8,050
	159,650			(18,948		)	140,702			(499,972		)	(12,381		)	(512,353		)
Other expenses
Interest costs, net	171,521			7,026			178,547			180,811			4,788			185,599
General and administrative	51,400			60			51,460			40,524			42			40,566
Internal leasing costs	11,807			—			11,807			10,192			—			10,192
Transaction and other costs	17,343			272			17,615			2,934			8			2,942
Debt prepayment costs, net	10,914			—			10,914			—			—			—
	262,985			7,358			270,343			234,461			4,838			239,299
Income (loss) before income taxes	$	598,330		$	—		$	598,330		$	(54,150	)	$	—		$	(54,150	)
Current income tax recovery	(59		)	—			(59		)	(275		)	—			(275		)
Deferred income tax expense	—			—			—			10,905			—			10,905
Net income (loss)	$	598,389		$	—		$	598,389		$	(64,780	)	$	—		$	(64,780	)

NOI and Same Property NOI

The following table reconciles operating income to NOI and Same Property NOI to NOI for the three months and years ended December 31, 2021 and 2020:

	Three months endedDecember 31						Years endedDecember 31
(thousands of dollars)		2021			2020			2021			2020
Operating Income	$	194,788		$	173,594		$	701,665		$	680,283
Adjusted for the following:
Property management and other service fees		(3,920	)		(4,050	)		(14,772	)		(16,584	)
Residential inventory gains		(26,334	)		(3,569	)		(28,381	)		(15,505	)
Operational lease revenue and (expenses) from ROU assets		1,264			1,065			4,799			3,983
NOI	$	165,798		$	167,040		$	663,311		$	652,177

	Three months endedDecember 31						Years ended December 31
(thousands of dollars)	2021			2020			2021			2020
Same Property NOI	$	156,439		$	149,120		$	612,463		$	592,196
NOI from income producing properties:
Acquired (i)	39			7			3,479			2,727
Disposed (i)	1,104			6,234			15,002			25,637
	1,143			6,241			18,481			28,364
NOI from completed properties under development	3,755			1,591			9,925			4,198
NOI from properties under de-leasing under development	1,153			1,461			4,999			5,715
Lease cancellation fees	394			5,199			6,457			6,284
Straight-line rent adjustment	1,050			1,458			6,928			7,177
NOI from residential rental	1,864			1,970			4,058			8,243
NOI	$	165,798		$	167,040		$	663,311		$	652,177

(i)	Includes properties acquired or disposed during the periods being compared.

Same Property NOI including completed PUD

	Three months ended December 31								Years ended December 31
(thousands of dollars)		2021			2020		% change			2021			2020		% change
Same Property NOI	$	156,439		$	149,120		4.9	%	$	612,463		$	592,196		3.4	%
Add:
NOI from completed properties under development		3,755			1,591					9,925			4,198
Same Property NOI including completed PUD	$	160,194		$	150,711		6.3	%	$	622,388		$	596,394		4.4	%

Same Property NOI excluding the pandemic-related provision

	Three months ended December 31								Years ended December 31
(thousands of dollars)		2021			2020		% change			2021			2020		% change
Same Property NOI	$	156,439		$	149,120		4.9	%	$	612,463		$	592,196		3.4	%
Add back:
Same property pandemic-related provision		2,962			8,663					16,856			40,715
Same Property NOI excluding the pandemic-related provision	$	159,401		$	157,783		1.0	%	$	629,319		$	632,911		(0.6	)%

FFO and FFO (excluding net debt prepayment costs and one-time compensation costs)

The following table reconciles net income (loss) attributable to Unitholders to FFO for the three months and years ended December 31, 2021 and 2020:

	Three months endedDecember 31						Years ended December 31
(thousands of dollars, except where otherwise noted)	2021			2020			2021			2020
Net income (loss) attributable to Unitholders	$	208,776		$	65,609		$	598,389		$	(64,780	)
Add back/(Deduct):
Fair value (gains) losses, net	(72,255		)	42,286			(124,052		)	526,775
Fair value (gains) losses included in equity-accounted investments	(1,480		)	2,852			1,113			9,613
Deferred income tax expense	—			9,105			—			10,905
Internal leasing costs	2,982			2,901			11,807			10,192
Transaction losses on investment properties, net (i)	901			121			402			503
Transaction costs on sale of investment properties	6,324			1,003			14,391			768
Change in unrealized fair value on marketable securities	—			—			—			10,219
Current income recovery	(68		)	(711		)	(59		)	(275		)
Operational lease revenue from ROU assets	887			710			3,308			2,572
Operational lease expenses from ROU assets in equity-accounted investments	(11		)	(7		)	(42		)	(28		)
Capitalized interest on equity-accounted investments (ii)	465			235			1,725			930
FFO	$	146,521		$	124,104		$	506,982		$	507,394
Add back:
Debt prepayment costs, net	3,896			—			10,914			—
One-time compensation costs	—			—			6,057			—
FFO (excluding net debt prepayment costs and one-time compensation costs)	$	150,417		$	124,104		$	523,953		$	507,394
FFO per unit - basic	$	0.46		$	0.39		$	1.60		$	1.60
FFO per unit - diluted	$	0.46		$	0.39		$	1.60		$	1.60
FFO per unit (excluding net debt prepayment costs and one-time compensation costs) - diluted	$	0.48		$	0.39		$	1.65		$	1.60
Weighted average number of Units - basic (in thousands)	315,534			317,739			317,201			317,725
Weighted average number of Units - diluted (in thousands)	315,733			317,739			317,284			317,725
Distributions paid							$	317,497		$	457,521
FFO Payout Ratio							62.6		%	90.2		%
FFO payout ratio (excluding net debt prepayment costs and one-time compensation costs)							60.6		%	90.2		%

(i)	Represents net transaction gains or losses connected to certain investment properties during the period.
(ii)	This amount represents the interest capitalized to RioCan's equity-accounted investment in WhiteCastle New Urban Fund, LP, WhiteCastle New Urban Fund 2, LP, WhiteCastle New Urban Fund 3, LP, WhiteCastle New Urban Fund 4, LP, WhiteCastle New Urban Fund 5, LP, RioCan-Fieldgate JV, RC (Queensway) LP and RC (Leaside) LP- Class B. This amount is not capitalized to properties under development under IFRS, but is allowed as an adjustment under REALPAC’s definition of FFO.

Development Spending

Total Development Spending for the three months and years ended December 31, 2021 and 2020 are as follows:

	Three months endedDecember 31						Years endedDecember 31
(thousands of dollars)		2021			2020			2021			2020
Development expenditures:
Properties under development	$	79,457		$	129,801		$	365,120		$	457,109
Residential inventory		14,330			11,604			62,351			36,304
Total Development Spending	$	93,787		$	141,405		$	427,471		$	493,413

Total Adjusted Debt and Total Contractual Debt

The following tables reconcile total debt to Total Adjusted Debt, total assets to Total Adjusted Assets, and total debt to Total Contractual Debt as at December 31, 2021 and 2020:

As at	December 31, 2021									December 31, 2020
(thousands of dollars, except where otherwise noted)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Debentures payable	$	2,990,692		$	—		$	2,990,692		$	3,340,278		$	—		$	3,340,278
Mortgages payable		2,334,016			166,368			2,500,384			2,797,066			108,337			2,905,403
Lines of credit and other bank loans		1,285,910			48,049			1,333,959			790,539			28,716			819,255
Total debt	$	6,610,618		$	214,417		$	6,825,035		$	6,927,883		$	137,053		$	7,064,936
Cash and cash equivalents		77,758			9,113			86,871			238,456			2,203			240,659
Total Adjusted Debt	$	6,532,860		$	205,304		$	6,738,164		$	6,689,427		$	134,850		$	6,824,277
Total assets	$	15,177,463		$	248,230		$	15,425,693		$	15,267,708		$	146,737		$	15,414,445
Cash and cash equivalents		77,758			9,113			86,871			238,456			2,203			240,659
Total Adjusted Assets	$	15,099,705		$	239,117		$	15,338,822		$	15,029,252		$	144,534		$	15,173,786
Total Adjusted Debt to Total Adjusted Assets		43.3%						43.9%			44.5%						45.0%

As at	December 31, 2021									December 31, 2020
(thousands of dollars)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Total debt	$	6,610,618		$	214,417		$	6,825,035		$	6,927,883		$	137,053		$	7,064,936
Less:
Unamortized debt financing costs, premiums and discounts on		(16,414	)		(386	)		(16,800	)		(16,819	)		(294	)		(17,113	)
origination and debt assumed, and modifications
Total Contractual Debt		6,627,032			214,803			6,841,835			6,944,702			137,347			7,082,049

Liquidity

As at December 31, 2021, RioCan had approximately $1.0 billion of liquidity as summarized in the following table:

As at	December 31, 2021									December 31, 2020
(thousands of dollars, except where otherwise noted)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Undrawn revolving unsecured operating line of credit	$	634,080		$	—		$	634,080		$	1,000,000		$	—		$	1,000,000
Undrawn construction lines and other bank loans		241,883			47,641			289,524			291,332			44,698			336,030
Cash and cash equivalents		77,758			9,113			86,871			238,456			2,203			240,659
Liquidity	$	953,721		$	56,754		$	1,010,475		$	1,529,788		$	46,901		$	1,576,689
Total Contractual Debt	$	6,627,032		$	214,803		$	6,841,835		$	6,944,702		$	137,347		$	7,082,049
Liquidity as percentage of Total Contractual Debt		14.4%						14.8%			22.0%						22.3%
Liquidity as at December 31, 2021	$	953,721		$	56,754		$	1,010,475
Increase subsequent to year end:
Borrowing capacity in revolving unsecured operating line of credit		250,000			—			250,000
Liquidity as of February 9, 2022	$	1,203,721		$	56,754		$	1,260,475

Unsecured Debt and Secured Debt

The following table reconciles total Unsecured Debt and Secured Debt to Total Contractual Debt as at December 31, 2021 and 2020:

As at	December 31, 2021									December 31, 2020
(thousands of dollars, except where otherwise noted)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Total Unsecured Debt	$	4,065,920		$	—		$	4,065,920		$	4,050,000		$	—		$	4,050,000
Total Secured Debt		2,561,112			214,803			2,775,915			2,894,702			137,347			3,032,049
Total Contractual Debt	$	6,627,032		$	214,803		$	6,841,835		$	6,944,702		$	137,347		$	7,082,049
Percentage of Total Contractual Debt:
Unsecured Debt		61.4%						59.4%			58.3%						57.2%
Secured Debt		38.6%						40.6%			41.7%						42.8%

Adjusted EBITDA

The following table reconciles consolidated net income (loss) attributable to Unitholders to Adjusted EBITDA:

	12 months ended
As at	December 31, 2021									December 31, 2020
(thousands of dollars)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Net income (loss) attributable to Unitholders	$	598,389		$	—		$	598,389		$	(64,780	)	$	—		$	(64,780	)
Add (deduct) the following items:
Income tax expense (recovery):
Current	(59		)	—			(59		)	(275		)	—			(275		)
Deferred	—			—			—			10,905			—			10,905
Fair value losses (gains) on investment properties, net	(124,052		)	1,113			(122,939		)	526,775			9,613			536,388
Change in unrealized fair value on marketable securities (i)	—			—			—			10,219			—			10,219
Internal leasing costs	11,807			—			11,807			10,192			—			10,192
Non-cash unit-based compensation expense	12,546			—			12,546			9,120			—			9,120
Interest costs, net	171,521			7,026			178,547			180,811			4,788			185,599
Debt prepayment costs, net	10,914			—			10,914			—			—			—
One-time cash compensation costs	1,932			—			1,932			—			—			—
Depreciation and amortization	4,022			—			4,022			4,342			—			4,342
Transaction losses on the sale of investment properties, net (ii)	402			—			402			503			—			503
Transaction costs on investment properties	14,363			28			14,391			768			—			768
Operational lease revenue and expenses from ROU assets	3,308			(42		)	3,266			2,572			(28		)	2,544
Adjusted EBITDA	$	705,093		$	8,125		$	713,218		$	691,152		$	14,373		$	705,525

(i)	The fair value gains on marketable securities include both the change in unrealized fair value and realized gains on the sale of marketable securities. By adding back the change in unrealized fair value on marketable securities, RioCan effectively continues to include realized gains or losses on the sale of marketable securities in Adjusted EBITDA and excludes unrealized fair value gains (losses) on marketable securities in Adjusted EBITDA.
(ii)	Includes transaction gains and losses realized on the disposition of investment properties.

Adjusted Debt to Adjusted EBITDA Ratio

Adjusted Debt to Adjusted EBITDA is calculated as follows:

	12 months ended
As at	December 31, 2021									December 31, 2020
(thousands of dollars)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Adjusted Debt to Adjusted EBITDA
Average total debt outstanding	$	6,773,147		$	192,804		$	6,965,951		$	6,667,444		$	128,270		$	6,795,714
Less: average cash and cash equivalents		(119,400	)		(5,639	)		(125,039	)		(111,487	)		(1,920	)		(113,407	)
Average Total Adjusted Debt	$	6,653,747		$	187,165		$	6,840,912		$	6,555,957		$	126,350		$	6,682,307
Adjusted EBITDA	$	705,093		$	8,125		$	713,218		$	691,152		$	14,373		$	705,525
Adjusted Debt to Adjusted EBITDA		9.44						9.59			9.49						9.47

Unencumbered Assets

The tables below summarize RioCan's Unencumbered Assets to Unsecured Debt and Percentage of Normalized NOI Generated from Unencumbered Assets as at December 31, 2021 and 2020:

As at		December 31, 2021									December 31, 2020
(thousands of dollars, except where otherwise noted)	Targeted Ratios	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
Unencumbered Assets		$	9,332,833		$	59,433		$	9,392,266		$	8,685,469		$	41,885		$	8,727,354
Total Unsecured Debt		$	4,065,920		$	—		$	4,065,920		$	4,050,000		$	—		$	4,050,000
Unencumbered Assets to Unsecured Debt	> 200%		230%						231%			214%						215%
Annual Normalized NOI - total portfolio (i)		$	649,208		$	22,688		$	671,896		$	631,652		$	13,772		$	645,424
Annual Normalized NOI - Unencumbered Assets (i)		$	432,820		$	3,440		$	436,260		$	370,736		$	2,396		$	373,132
Percentage of Normalized NOI Generated from Unencumbered Assets	> 50.0%		66.7%						64.9%			58.7%						57.8%

(i)	Annual Normalized NOI are reconciled in the table below.

	Three months ended December 31, 2021									Three months ended December 31, 2020
(thousands of dollars, except where otherwise noted)	IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare			IFRS basis			Equity-accountedinvestments			RioCan'sproportionateshare
NOI (i)	$	165,798		$	5,672		$	171,470		$	167,040		$	3,443		$	170,483
Adjust the following:
Miscellaneous revenue		(540	)		—			(540	)		(1,154	)		—			(1,154	)
Percentage rent		(2,562	)		—			(2,562	)		(2,774	)		—			(2,774	)
Lease cancellation fees		(394	)		—			(394	)		(5,199	)		—			(5,199	)
Normalized NOI - total portfolio	$	162,302		$	5,672		$	167,974		$	157,913		$	3,443		$	161,356
Annual Normalized NOI - total portfolio(ii)	$	649,208		$	22,688		$	671,896		$	631,652		$	13,772		$	645,424
NOI from unencumbered assets (i)	$	110,517		$	860		$	111,377		$	94,956		$	599		$	95,555
Adjust the following:
Miscellaneous revenue- Unencumbered Assets		(253	)		—			(253	)		(545	)		—			(545	)
Percentage rent- Unencumbered Assets		(1,852	)		—			(1,852	)		(1,553	)		—			(1,553	)
Lease cancellation fees- Unencumbered Assets		(207	)		—			(207	)		(174	)		—			(174	)
Normalized NOI - Unencumbered Assets	$	108,205		$	860		$	109,065		$	92,684		$	599		$	93,283
Annual Normalized NOI - Unencumbered Assets (ii)	$	432,820		$	3,440		$	436,260		$	370,736		$	2,396		$	373,132

(i)	Refer to the NOI and Same Property NOI table of this section for reconciliation from NOI to operating income.
(ii)	Applied a factor of 4 to Annual Normalized NOI.

Forward-Looking Information

This News Release contains forward-looking information within the meaning of applicable Canadian securities laws. This information reflects RioCan’s objectives, our strategies to achieve those objectives, as well as statements with respect to management’s beliefs, estimates and intentions concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking information generally can be identified by the use of forward-looking terminology such as “outlook”, “objective”, “may”, “will”, “would”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plan”, “continue”, or similar expressions suggesting future outcomes or events. Such forward-looking information reflects management’s current beliefs and is based on information currently available to management. All forward-looking information in this News Release is qualified by these cautionary statements. Forward-looking information is not a guarantee of future events or performance and, by its nature, is based on RioCan’s current estimates and assumptions, which are subject to numerous risks and uncertainties, including those described in the “Risks and Uncertainties” section in RioCan's MD&A for the three months and year ended December 31, 2021 and in our most recent Annual Information Form, which could cause actual events or results to differ materially from the forward-looking information contained in this News Release. General economic conditions, including interest rate fluctuations, may also have an effect on RioCan’s results of operations. Material factors or assumptions that were applied in drawing a conclusion or making an estimate set out in the forward-looking information may include, but are not limited to: a gradual recovery and growth of the retail environment and the general economy over 2022; relatively historically low interest costs; a continuing trend toward land use intensification at reasonable costs and development yields, including residential development in urban markets; access to equity and debt capital markets to fund, at acceptable costs, future capital requirements and to enable our refinancing of debts as they mature; the availability of investment opportunities for growth in Canada; the timing and ability for RioCan to sell certain properties; the valuations to be realized on property sales relative to current IFRS values; and the Trust's ability to utilize the capital gain refund mechanism. Although the forward-looking information contained in this News Release is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with this forward-looking information.

Given the current level of uncertainty arising from the COVID-19 pandemic, there can be no assurance regarding the impact of COVID-19 on the business, operations, and financial performance of RioCan and its tenants, as well as on consumer behaviors and the economy in general. General risks and uncertainties related to the COVID-19 pandemic also include, but are not limited to, the length, spread and severity of the pandemic; efficacy of the vaccines and any applicable boosters, the nature and length of the restrictive measures implemented or to be implemented, including any loosening of the restrictive measures, by various levels of government in Canada; RioCan's tenants' ability to pay rents as required under their leases; the availability of various support programs that are or may be offered by the various levels of government in Canada; the introduction or extension of temporary or permanent rent control or other forms of regulation or legislation that may limit the Trust's ability or the extent to which it can raise rents based on market conditions upon lease renewals or restrict existing landlord rights or a landlord's ability to reinforce such rights; domestic and global supply chains; timelines and costs related to the Trust’s development projects; the pace of property lease-up and rents and yields achieved upon development completion; potential changes in leasing activities, market rents and property valuations; the capitalization rates that arm's length buyers and sellers are willing to transact on properties; the availability and extent of rent deferrals offered or to be offered by the Trust; domestic and global credit and capital markets, and the Trust's ability to access capital on favourable terms or at all and its ability to maintain its credit ratings; the total return and dividend yield of RioCan's Units; and the health and safety of our employees, tenants and people in the communities that our properties serve.

The forward-looking statements contained in this News Release are made as of the date hereof, and should not be relied upon as representing RioCan’s views as of any date subsequent to the date of this News Release. Management undertakes no obligation, except as required by applicable law, to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

Contact Information RioCan Real Estate Investment Trust Dennis Blasutti Chief Financial Officer 416-866-3033 | www.riocan.com