Topic: How To Invest

What is Pat’s commentary for the week of July 6, 2021

Article Excerpt

RioCan shocked investors in late 2020 when it cut its distribution after promising to maintain the rate. COVID-19 lockdowns, particularly in Ontario, hurt the REIT’s cash flow and led to its decision to cut the payment. While disappointing, the move was prudent as the new annual distribution rate of $0.96 a unit (which still gives you a solid 4.3% yield) is a much more sustainable payout. Meantime, RioCan’s strategy to focus on six major cities—Toronto, Ottawa, Montreal, Edmonton, Calgary and Vancouver—positions it for long-term growth as the pandemic eases and immigration levels rebound. Those cities now supply 90% of the REIT’s rental revenue. The trust is also adding residential and office space to cut its exposure to vulnerable retailers. That’s in recognition of the ongoing shift to online shopping, which the pandemic only accelerated. I asked our Successful Investor research department to draw up this Inner Circle Spotlight report on RioCan. It shows why we feel the REIT offers investors an attractive combination of…

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