RioCan's HIGHLIGHTS for 2017:

• For the year ended December 31, 2017, IFRS Operating income increased 5.4% to $737 million. For the three months ended December 31, 2017 ("Fourth Quarter"), IFRS Operating income increased 3.9% to $188 million;
• Funds From Operations ("FFO") increased 6.7% or $37 million to $585 million in 2017. FFO per unit increased 6.3% or $0.11 to $1.79, despite the sale of the U.S. portfolio in May 2016;
• FFO increased 9.1% or $12 million to $144 million in the Fourth Quarter over the comparable quarter in 2016. FFO per unit in the Fourth Quarter increased 9.3% or $0.04 to $0.44;
• Same property NOI for the year ended December 31, 2017 increased 2.1% or $14 million compared to 2016. This is the Trust's strongest annual same property performance since 2010. Same property NOI for RioCan's properties in Canada's six major markets increased 2.2% from 2017 to 2016 as compared to same property NOI growth of 1.7% in the secondary markets;
• Same property NOI increased by 2.9%, or $4.9 million in the Fourth Quarter as compared to the same quarter in 2016. This is the strongest quarterly same property NOI growth since the fourth quarter of 2010. Same property NOI for RioCan's properties in Canada's six major markets increased 3.0% over the comparable fourth quarter as compared to same property NOI growth of 2.6% in the secondary markets;
• Committed occupancy improved by 100 basis points to 96.6% at December 31, 2017 as compared to December 31, 2016. In addition, committed occupancy for RioCan's properties in Canada's six major markets increased by 110 basis points to 97.6% at December 31, 2017 as compared to December 31, 2016. In-place occupancy increased 200 basis points from 93.6% at December 31, 2016 to 95.6% at December 31, 2017;
• Lease renewal retention rate increased 530 basis points to 91.1% in 2017 from 85.8% in 2016 with a 5.8% renewal spread in 2017;
• The Trust is making good progress on the execution of its strategy to accelerate its portfolio focus in Canada’s six major markets. In the four months since the strategy's announcement in October 2017, the Trust has either completed or entered into firm agreements to sell $512 million of properties in secondary markets at a weighted average capitalization rate of 6.07% based on in-place NOI, representing approximately 25% of the announced disposition target; the Trust currently also has conditional transactions under contracts totalling $58 million. The aggregate sales proceeds from these assets are in line with the Trust's IFRS valuations;
• The percentage of rental revenue generated from RioCan's properties in Canada's six major markets increased by 0.9% to 76.1% in the Fourth Quarter versus the third quarter, with the Greater Toronto Area ("GTA") generating 40.9% of RioCan's annualized rental revenue as at December 31, 2017;
• The Trust obtained 4.5 million square feet of zoning approvals in 2017 and completed 849,000 square feet of development projects with $224 million costs transferred to income producing properties;
• RioCan is making significant progress on the re-leasing of the former Sears space, which accounted for 0.8% of the Trust's total NLA as of September 31, 2017. The Trust has completed or is in the final stages of lease negotiations for 320,000 square feet or 84% of the vacated Sears space (at RioCan's interest). These leases will replace approximately 130% of the lost annual rental revenue from all of the former Sears space.
• The Trust continued to maintain a strong balance sheet with a debt to total assets ratio of 41.4% on proportionate share basis as of December 31, 2017 , and further improved its debt to adjusted EBITDA ratio to 7.57x for the year. The Trust continued to grow its unencumbered assets pool to $7.7 billion, which generates 56.7% of RioCan's annualized NOI as of December 31, 2017; and
• Effective January 1, 2018, RioCan increased its annual distribution by $0.03 or 2.1% to $1.44 per unit.

TORONTO, Feb. 13, 2018 (GLOBE NEWSWIRE) -- RioCan Real Estate Investment Trust (“RioCan”) (TSX:REI.UN) today announced its financial results for the three months and year ended December 31, 2017.

“I am very pleased with our results this year, as 2017 marked the strongest year of same property performance for RioCan in seven years. The performance of our operations excelled in the past year, driving our FFO per unit, to its highest level in the Trust's history, excluding 2015 when we received a substantial Target settlement, and grew FFO per unit by 6.3% over 2016. Our occupancy levels returned to their historical average of near 97% in the second half of the year and our same property portfolio posted the best results that RioCan has delivered since 2010. We are anticipating that 2018 will continue the momentum that began in the second half of 2016, with another year of solid same property performance. By the end of this year, we should begin to realize some of the benefits of our development program with a number of completions that will propel our growth into 2019,” said Edward Sonshine, Chief Executive Officer of RioCan. “We are pleased with the progress that we have already made in executing our strategic vision for RioCan, and we are very confident in our ability to build on our early successes. Our strong balance sheet and the capital provided through the sale of secondary markets properties will enable RioCan to focus on the ongoing value creation in our major market portfolio that will greatly enhance the quality, resilience and growth profile of our portfolio and deliver strong FFO and net asset value growth to our unitholders during this very exciting time for RioCan.”

Financial Highlights
All figures are expressed in Canadian dollars unless otherwise noted. For further information about RioCan's results for the year ended December 31, 2017, this earnings release should be read in conjunction with our audited annual consolidated financial statements ("Consolidated Financial Statements"), as well as Management's Discussion and Analysis ("MD&A") for the year ended December 31, 2017.

RioCan’s Consolidated Financial Statements are prepared in accordance with International Financial Reporting Standards (“IFRS”). Consistent with RioCan’s management framework, management uses certain financial measures to assess RioCan’s financial performance, which are not generally accepted accounting principles (GAAP) under IFRS. For full definitions of these measures, please refer to “Non-GAAP Measures” in RioCan’s December 31, 2017 Management's Discussion and Analysis. As a result of the sale of the U.S. operations, we have reported our former U.S. geographic segment performance as "discontinued operations" with comparative income statement amounts adjusted to reflect this change, unless otherwise noted.

Net income from continuing operations attributable to unitholders

2017
Net income from continuing operations attributable to unitholders for the year ended December 31, 2017 is $708.3 million, representing an increase of $25.2 million compared to the same period in 2016. Excluding $45.9 million lower fair value gains over the comparable period, net income from continuing operations attributable to unitholders for the year ended December 31, 2017 increased by $71.2 million or 14.2% from the prior year.

The increase of $71.2 million is largely the net effect of the following:

• $36.4 million higher income primarily due to property acquisitions (net of dispositions), strong same property performance, completed developments, and higher lease cancellation fees;
• $31.9 million increase in gains from the sale of available-for-sale marketable securities;
• $8.1 million in interest savings due mainly to lower average debt and debt refinancing at lower interest rates;
• $5.7 million in higher income from our equity accounted investments; partly offset by
• $6.1 million in lower transaction gains; and
• $4.6 million less dividend income from available-for-sale marketable securities given such sales since Q3 2016.

Q4 2017
Net income from continuing operations attributable to unitholders for the three months ended December 31, 2017 is $209.7 million, representing an increase of $31.3 million to the same period in 2016. Excluding $26.6 million higher fair value gains over the comparable period, net income from continuing operations attributable to unitholders for the fourth quarter of 2017 increased $4.6 million or 3.4% from the same period in 2016 .

The increase of $4.6 million is largely the net effect of the following:

• $5.0 million increase is primarily due to strong same property performance; and
• $6.8 million increase in gains from the sale of available-for-sale marketable securities; partially offset by
• $4.1 million in higher general and administrative expenses primarily due to accelerated depreciation of certain management information systems: and
• $2.6 million higher other costs as a result of a one-time fair market value adjustment to a loan receivable. Funds From Operations ("FFO")

Funds From Operations ("FFO")

(i) A non-GAAP measurement. A reconciliation to net income can be found under “Results of Operations” in RioCan's Management's Discussion and Analysis for the period ending December 31, 2017. 

2017
FFO for the year ended 2017 is $584.6 million, an increase of $36.7 million or 6.7%. On diluted per unit basis, FFO is $1.79 compared to $1.68 in 2016, an increase of 6.3%, despite the sale of the U.S. portfolio in May 2016. 

Continuing Operations
FFO from continuing operations increased $85.3 million or 17.2% to $582.6 million in 2017. The $85.3 million increase in FFO from continuing operations for the period was primarily due to the following: 

• $36.2 million higher NOI (at RioCan’s proportionate share) mainly as a result of acquisitions (net of dispositions), strong growth in same property NOI, development completions and higher lease cancellation fees;
• $31.9 million increase in gains related to the sale of available-for-sale marketable securities;
• $7.7 million lower interest costs (at RioCan's proportionate share);
• $9.5 million less preferred unit distributions and redemption costs;
• $5.8 million in higher income from our equity accounted investments; partially offset by
• $4.6 million lower dividend income from the sale of available-for-sale marketable securities.

Q4 2017
FFO for the fourth quarter of 2017 is $144.2 million, an increase of $12.0 million or 9.1%. On a diluted per unit basis, FFO is $0.44 compared to $0.40 in Q4 2016, representing an increase of 9.3%.

Continuing Operations
FFO from continuing operations increased $11.6 million or 8.8% to $144.1 million in Q4 2017. The $11.6 million increase in FFO from continuing operations for the quarter was primarily due to the net effect of the following:

• $4.8 million higher NOI (at RioCan’s proportionate share) mainly as a result of strong same property NOI growth;
• $6.8 million increase in gains related to the sale of available-for-sale marketable securities;
• $3.7 million in higher income from equity accounted investments; partly offset by
• $4.1 million higher general and administrative expenses mainly due to accelerated depreciation as noted above.

Acceleration of Major Market Focus
On October 2, 2017 the Trust announced its plan to accelerate its portfolio focus in Canada’s six major markets through the sale of approximately 100 properties located primarily in secondary markets across Canada over the next two to three years.

As of February 13, 2018, four months since the strategy's announcement, the Trust has either completed or entered into firm agreements to sell $511.9 million of properties in secondary markets at a weighted average capitalization rate of 6.07% based on in-place net operating income (NOI), representing approximately 25% of the announced disposition target. The deals consist of the following:

• An firm agreement to sell seven properties to CT REIT in Hamilton, Orillia, Sudbury, Collingwood and St. Catharines in Ontario, Oliver, British Columbia and Yorkton, Saskatchewan at an aggregate sale price of $200.0 million and a weighted average capitalization rate of 6.12% based on in-place NOI. The sale of five properties were closed in December 2017 at a sales price of $135.2 million, with $21.7 million of mortgages repaid on closing. The sales of the remaining two properties are expected to be completed during the first quarter of 2018.
• The sale of a 50% non-managing interest of a property in Fredericton, New Brunswick in December 2017 to the property's co-owner for a sale price of $10.0 million at a capitalization rate of 10.20% based on in-place NOI. RioCan provided a vendor take-back mortgage of $2.5 million.
• A firm agreement to sell two properties in Kelowna and Vernon in British Columbia at a sale price of $85.0 million at a weighted average capitalization rate of 5.45% based on in-place NOI, subject to customary closing conditions. On the expected closing date in the first quarter of 2018, the buyer will assume the mortgage payable of $32.7 million and RioCan will provide a vendor take-back mortgage of $7.5 million.
• A firm agreement to sell four properties in Flamborough, Guelph and Orangeville in Ontario and Duncan in British Columbia at a sale price of $216.9 million at a weighted average capitalization rate of 6.06% based on in-place NOI, with $67.5 million mortgages payable to be repaid upon expected deal closing in April 2018.

In addition to the above $511.9 million closed and firm deals, the Trust has also entered into three conditional agreements as of February 13, 2018 to sell five properties in Ontario and Quebec for aggregate sale proceeds of $58.0 million at a weighted average capitalization rate of 6.66%. Should these firm and conditional transactions close by the end of the second quarter in 2018, as currently contemplated, the Trust would have completed the sale of 19 properties for aggregate sale proceeds of $569.9 million or approximately 28% of our disposition target by sales proceeds, at a weighted average capitalization rate of 6.13%. The aggregate proceeds from the sale of these properties are in line with the Trust's IFRS valuations.

The net proceeds from the dispositions have been and will be used to pay down debt, fund unit repurchases through RioCan’s Normal Course Issuer Bid (NCIB) program and fund the Trust’s development activities. Since the renewal of the NCIB program on October 20, 2017 and as of December 31, 2017, RioCan has purchased and cancelled 3.9 million Trust units at an average purchase price of $25.30 per unit.

Operational Performance

Same Property NOI Growth

Refers to same property NOI growth on a year over year basis. 

2017
Same property NOI for the year ended December 31, 2017 increased 2.1% or $13.6 million compared to the same period in 2016. This is the strongest annual same property growth that the Trust has generated since 2010. Approximately $8.8 million of the increase related to higher occupancy, renewal rate growth and contractual rent increases and $4.8 million is due to the timing of Target backfills and other expansion and redevelopment projects completed in 2017 and 2016.

As a component of total same property NOI growth, same property NOI from RioCan's properties in Canada's six major markets increased 2.2% for the year ended December 31, 2017, while same property NOI over the same comparable period for the Trust's secondary markets grew 1.7%.

Q4 2017
Same property NOI for the three months ended December 31, 2017 increased 2.9% or $4.9 million compared to the same period in 2016. Approximately $3.8 million of the increase related to higher occupancy, renewal rate growth and contractual rent increases and $1.1 million is due to an increase in NOI from Target backfills and other expansion and re-development projects completed. This is the strongest quarterly same property NOI growth since the fourth quarter of 2010.

As a component of total same property NOI growth, same property NOI from RioCan's properties in Canada's six major markets increased 3.0% for the three months ended December 31, 2017 over the same period in 2016 while same property NOI from the Trust's secondary markets properties grew 2.6% over the same comparable period.

Operating Statistics
The key performance indicators related to operating and leasing for the Canadian portfolio over the last eight quarters are as follows:

• Despite Sears closures in the Fourth Quarter, which accounted for 0.8% of the Trust's GLA as of September 30, 2017, in-place and committed occupancies remain near the Trust's historical highs as of December 31, 2017,
• Committed occupancy improved by 100 basis points to 96.6% at December 31, 2017 as compared to 95.6% at December 31, 2016;
• In-place occupancy as of December 31, 2017 increased 200 basis points from 93.6% at December 31, 2016 to 95.6% at December 31, 2017,
• The Trust expects to generate $9.0 million of annualized net incremental IFRS rent once all tenants that have committed leases as of December 31, 2017 take possession of their space; and
• RioCan's retention rate increased 530 basis points to 91.1% in 2017 from 85.8% in 2016 with a 5.8% renewal spread in 2017.

Sears Space Leasing Update
RioCan is making significant progress on the re-leasing of the former Sears premises, with leases completed or in the final stages of negotiation on 320,000 square feet or 84% of the vacated Sears space at RioCan's interest. These leases will replace approximately 130% of the lost annual rental revenue from all of the former Sears space. The replacement rents are expected to exceed that which was paid by Sears by approximately $5.00 per square foot (60% increase).

Unlike our previous experience with the vacated Target premises, we will not be required to undergo the time-consuming process to obtain site plan approvals to convert the majority of the Sears premises to multi-tenant units.

As such, we anticipate that replacement tenants will be in possession of the spaces by the end of 2018 and will be open and paying rent in Q1/Q2 of 2019, with costs of tenant work considerably less than what was incurred to fill the vacated Target spaces.

Income-Producing Property Acquisitions and Dispositions
Income Producing Property Acquisitions
During the year ended December 31, 2017, the Trust completed the acquisition of one income property for $16.5 million and assumed debt of $8.6 million.

Subsequent to December 31, 2017, the Trust acquired Thickson Centre in Whitby, Ontario for a purchase price of $31.1 million at a capitalization rate of 6.16% with no assumption of debt. The Trust also acquired the remaining one third interest in an existing income property in Newmarket, Ontario for a purchase price of $18.5 million at a capitalization rate of 5.65% and assumed a mortgage payable with a fair value of $9.4 million.

Additional Capital Recycling
As part of RioCan's ongoing capital recycling program, RioCan completed income producing property dispositions
totalling $149.6 million in 2017 in addition to the strategic dispositions as noted earlier. These consist of:

• Sale of its Cambie Street property in Vancouver, British Columbia on June 29, 2017, for a sale price of $94.2 million at a capitalization rate of 3.29%. There was no debt on the property.
• Sale of a portfolio of six chartered bank branches located in British Columbia on August 3, 2017 for a sale price of $30.3 million at a capitalization rate of 3.72%. There was no debt relating to the disposition.
• Sale of a partnership interest for sale proceeds of $25.1 million in Q1 2017.

Also, RioCan sold a portion of its available-for-sale marketable securities and recognized gains of $10.5 million in the Fourth Quarter and $46.0 million for the year ended December 31, 2017 .

Development Program
RioCan's development program is a significant component of its growth strategy to unlock the intrinsic value of its existing properties through redevelopment and intensification and deliver strong net asset value ("NAV" ) growth to its unitholders. During 2017, RioCan continued to make significant progress in advancing its development program, notably:

Project completions - completed 0.8 million square feet of projects with $224.3 million costs transferred to income producing properties. Notably the Trust substantially completed the Sage Hill development, a 380,000 square foot new format centre located in a growing residential suburb in northwest Calgary. This project is co-owned with KingSett Capital on a 50/50 basis. The 32 acre development site is anchored by Walmart and Calgary’s first Loblaws City Market banner, with an excellent mix of strong national (London Drugs, Dollarama, Scotiabank, McDonalds, Royal Bank of Canada) and high quality regional retailers.

Zoning approvals and development pipeline - obtained 4.5 million square feet (at RioCan's interest) of zoning approvals in 2017 including the zoning approvals for The Well in Toronto, Westgate and Elmvale in Ottawa, Millwoods in Edmonton and Southland in Calgary. The Trust continues to identify new intensification opportunities and expand its development pipeline, while maintaining prudent capital management. As of December 31, 2017, the Trust has identified approximately 26.3 million square feet of development pipeline (at RioCan's interests), of which 46.7% is already zoned and another 20.1% with zoning applications submitted.

Project and leasing progress - Several large projects are progressing as planned and are scheduled to be completed by the end of 2018 or early 2019, including but not limited to:

• Yonge Eglinton Northeast Corner Condominium - the 623 unit fully pre-sold landmark condominium project located at the intersection of the Yonge-Bloor subway line and the new Eglinton Crosstown light rail transit line ("Eglinton LRT") in Toronto; 50/50 co-owned by RioCan and Metropia/Bazis;
• Yonge Eglinton Northeast Corner Residential Rental - a 466 residential rental unit project, including 65 residential rental replacement units and retail and office space with underground access to the Yonge-Bloor subway line and Eglinton LRT in Toronto; 50/50 co-owned by RioCan and Metropia/Bazis; and
• King & Portland - a mixed-use project in the trendy Toronto King West neighbourhood. In September 2017, RioCan and its 50% partner Allied Properties Real Estate Investment Trust ("Allied") seized the market trend and changed the originally contemplated residential rental component to condominium units, 100% of which were subsequently sold with profitability well ahead of initial estimate. The project's office component is 100% leased and the retail component is currently 44% leased with the remaining 7,000 square feet expected to be leased upon completion. 
  
  The Trust continues to make good progress on other developments such as Sheppard Centre, 491 College Street and Bathurst College Centre, all located in urban Toronto and scheduled for full or phased completion in 2018.

New strategic alliances - Part of the strength in RioCan's development program is its ability to attract well-established partners with proven track records and residential development expertise. During 2017, RioCan entered into strategic alliances with a few new partners through the sale of partial interests in several development projects. Such strategic alliances not only reduce the Trust's development risks but also crystallize the value of zoned density and generate NAV growth for unitholders.

• Gloucester Residential - a new 50/50 joint venture with Killam Apartment Real Estate Investment Trust formed on April 21, 2017 to redevelop an income producing property located on the new Confederation LRT line in Ottawa into a residential community with four residential towers containing up to 840 units (at 100%);
• Sunnybrook Plaza - a new 50/50 joint venture with Concert Real Estate Corporation formed on June 14, 2017 to redevelop an income producing property located on the new Yonge Eglinton LRT route in Toronto into a 16-storey and an 11-storey mixed-use project; and
• Yorkville - a new partner Capital Developments ("CD") was introduced on October 12, 2017, and the project is a 50/25/25 joint venture among RioCan, Metropia and CD. The project is located in the prestigious Toronto Yorkville neighborhood with the potential for approximately half a million square feet of luxury condominiums, retail uses and up to 82 residential rental replacement units. As of February 13, 2018, the partners have completed acquisitions of adjacent properties substantially required for the intensification project. RioCan has agreed to purchase the partners' interest in the retail portion upon project completion at a 6% capitalization rate and has the right of first opportunity to acquire the residential rental replacement units. This will provide further NAV growth to the Trust's unitholders.
• Brentwood Village - On November 23, 2017, RioCan completed the sale of a 50% interest in a discrete portion of its Brentwood Village property in Calgary, Alberta to Boardwalk Real Estate Investment Trust for total proceeds, including certain cost recoveries, of $4.8 million (50% interest). The co-owners plan to develop this discrete portion of the property into a mixed-use project with 163 residential rental units plus retail space. RioCan continues to own 100% of the main portion of the property including existing retail and future density.

Building on existing strategic alliances - RioCan continues to build on and re-align our existing strategic alliances with our partners when opportunities arise for similar reasons as noted earlier for new strategic alliances.

• Yonge Eglinton Northeast Corner - On July 5, 2017, RioCan entered into an agreement with its partner to purchase the remaining 50% interest in the rental residential tower of the landmark, mixed-use, transit oriented project. The purchase price is based on costs plus $10.0 million upon closing (which is estimated in the first quarter of 2019), subject to final costs amount.
  
  RioCan also has an agreement to acquire the remaining 50% interest in the retail component of the project at a purchase price based on a 7% capitalization rate and the stabilized net operating income upon completion in 2019.
  
  Both deals will provide RioCan further NAV growth potential upon deal closings.
  
  
• The Well - On October 5, 2017, RioCan and its partner Allied acquired Whitecastle New Urban Fund 2's undivided 20% interest in the commercial component of The Well, the large-scale landmark mixed-use development in downtown Toronto. As a result of this transaction, both Allied and RioCan each own an undivided 50% interest in the commercial component of the project.
• Windfield Townhouse Development - On October 27, 2017, RioCan formed a 50/50 joint venture with Tribute Communities ("Tribute") to develop 551 townhouses in several phases on approximately 31 acres at RioCan's Windfields Farm development property in Oshawa, Ontario. 166 of the 170 units released in phase one and 14 of the 94 units in phase two have been sold.
• 740 Dupont - On December 15, 2017, RioCan completed the sale of a 50% interest in its 740 Dupont Avenue mixed-use development project in Toronto, Ontario to Woodbourne Canada Partners ("Woodbourne") for total proceeds, including certain cost recoveries, of $9.4 million (50% interest). The mixed-use project will consist of 210 residential rental units plus retail space. Woodbourne is also the Trust's 50% partner in its largest 584-unit residential rental development - residential Building 6 at The Well in downtown Toronto.
• E2 Condos at Yonge & Eglinton - On December 11, 2017 RioCan acquired a 10% interest in E2 Condos, a development adjacent to the Trust's residential rental project at the northeast corner of Yonge and Eglinton. RioCan will invest a total of $3.0 million and will participate in project profits and earn fees for easement rights. During Q4 2017, RioCan contributed $1.4 million to the project.

Liquidity and Capital
RioCan’s debt and leverage metrics are disclosed below to help facilitate an understanding of RioCan’s leverage and its ability to service such leverage. The definitions that management uses, as well as the calculation methodology for the ratios included in the table below are described in RioCan's Management’s Discussion and Analysis for the year ended December 31, 2017.

(i)       Refer to section Non-GAAP Measures in RioCan's MD&A for further details and the calculation of Adjusted EBITDA for the respective periods.
(ii)      Ratio is calculated on a continuing operations basis.

The Trust's interest, debt service and fixed charge coverage ratios, as well as Debt to Adjusted EBITDA , at RioCan's proportionate share for the year ended December 31, 2017 have all significantly improved compared to December 31, 2016 mainly due to lower interest and debt service costs as a result of the repayment of debt using the net proceeds from the U.S. sale and interest savings from mortgage refinancing and redemption of preferred units, and an increase in Adjusted EBITDA primarily as a result of acquisitions (net of dispositions), strong same property NOI growth, development completions, and higher gains from the sale of available-for-sale marketable securities

The Trust's leverage ratio (total debt to total assets) at RioCan's proportionate share remained low at 41.4% and within the Trust's target range as of December 31, 2017. This ratio increased by 1.4% over December 31, 2016 mainly as a result of payment of income taxes in Q1 2017 relating to the sale of the U.S. portfolio in 2016, which had been accrued in 2016, and the redemption of the Series C preferred units in Q2 2017.

The Trust continued to grow its portfolio of unencumbered assets during 2017. As of December 31, 2017, the Trust has $7.7 billion unencumbered assets, which generates 56.7% of the Trust's annualized NOI as of December 31, 2017, as compared to 49.5% as of December 31, 2016. The unencumbered assets to unsecured debt ratio decreased from 240% to 226% over this period, but remained well over our 200% target, as the increase in our unsecured debt of $635 million outpaced the $1.0 billion increase in unencumbered assets on a relative percentage basis.

As at December 31, 2017, we exceeded all of our debt metrics targets.

On January 31, 2018, the Trust issued $300 million of Series AA senior unsecured debentures, which mature on September 29, 2023 and carry a coupon rate of 3.209%. The interest on these debentures is payable semi­annually commencing September 29, 2018. The debentures were sold at a price of $999.95 per $1,000 principal amount with an effective yield of 3.209% if held to maturity.

Selected Financial Information
The following includes financial information prepared by management in accordance with IFRS and based on the Trust's Consolidated Financial Statements for the period ended December 31, 2017. This financial information does not contain all disclosures required by IFRS, and accordingly should be read in conjunction with the Trust's Consolidated Financial Statements and MD&A for the period ended December 31, 2017, which is available on RioCan's website and on SEDAR.

CONSOLIDATED BALANCE SHEETS
(In thousands of Canadian dollars, except per unit amounts)
(unaudited)

CONSOLIDATED STATEMENTS OF INCOME
(In thousands of Canadian dollars, except per unit amounts) 
(unaudited)

CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of Canadian dollars)
(unaudited)

Conference Call and Webcast
Interested parties are invited to participate in a conference call with management on Wednesday, February 14, 2017 at 9:00 a.m. Eastern time. You will be required to identify yourself and the organization on whose behalf you are participating.

In order to participate, please dial 647-427-3230 or 1-877-486-4304. If you cannot participate in the live mode, a replay will be available. To access the replay, please dial 1-855-859-2056 and enter passcode 5186169#.

A copy of the slides to be used for the conference call or, to access the simultaneous webcast, can be found on RioCan’s website at http://investor.riocan.com/investor-relations/events-and-presentations/ and click on the link for the webcast. The webcast will be archived 24 hours after the end of the conference call and can be accessed for 120 days.

About RioCan
RioCan is Canada’s largest real estate investment trust with a total enterprise value of approximately $13.9 billion at December 31, 2017. 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. Our portfolio is comprised of 289 properties, including 17 development properties, with an aggregate net leasable area of approximately 44 million square feet. To learn more about how we deliver real vision on solid ground, visit www.riocan.com.

Non-GAAP Measures
RioCan’s consolidated financial statements are prepared in accordance with IFRS. Consistent with RioCan’s management framework, management uses certain financial measures to assess RioCan’s financial performance, which are not generally accepted accounting principles (GAAP) under IFRS. The following measures, RioCan's Interest, RioCan's Proportionate Share, Funds From Operations (“FFO”), Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), Interest Coverage Ratio, Debt Service Coverage Ratio, Debt to Adjusted EBITDA, Net Operating Income ("NOI"), Same Property NOI, Fixed Charge Coverage, Percentage of NOI Generated from Unencumbered Assets, Unencumbered Assets to Unsecured Debt, and Total Enterprise Value, as well as other measures that may be discussed elsewhere in this 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 a full definition of these measures, please refer to the “Non-GAAP Measures” in RioCan’s Management Discussion and Analysis for the period ending December 31, 2017.

Forward-Looking Information
This news release contains forward-looking information within the meaning of applicable Canadian securities laws. This information includes, but is not limited to, statements made in “Financial Highlights”, "Acceleration of Major Market Focus", “Operational Performance", "Other Operating Statistics" “Acquisitions and Dispositions”, "Development Program", Liquidity and Capital" and other statements concerning RioCan’s objectives, its strategies to achieve those objectives, as well as statements with respect to management’s beliefs, plans, estimates, and intentions, and similar statements 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 under “Risks and Uncertainties” in RioCan's Management's Discussion and Analysis for the period ended December 31, 2017 ("MD&A"), which could cause actual events or results to differ materially from the forward-looking information contained in this News Release. Those risks and uncertainties include, but are not limited to, those related to: liquidity and general market conditions; tenant concentrations and related risk of bankruptcy or restructuring (and the terms of any bankruptcy or restructuring proceeding); occupancy levels and defaults, including the failure to fulfill contractual obligations by the tenant or a related party thereof; lease renewals and rental increases; the ability to re-lease and find new tenants for vacant space; retailer competition; potential changes in Ontario's rent control legislation; access to debt and equity capital; interest rate and financing risk; joint ventures and partnerships; the relative illiquidity of real property, the timing and ability of 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; unexpected costs or liabilities related to acquisitions and dispositions; development risk associated with construction commitments, project costs and related approvals; environmental matters; litigation; reliance on key personnel; unitholder liability; income, sales and land transfer taxes; and credit ratings.

Our U.S. subsidiary qualified as a REIT for U.S. income tax purposes up to May 25, 2016, subsequent to the closing date of the sale of our U.S. property portfolio. For U.S. income tax purposes, the subsidiary distributed all of its U.S. taxable income and is entitled to deduct such distributions against its taxable income. The subsidiary’s qualification as a REIT depends on the REIT’s satisfaction of certain asset, income, organizational, distribution, unitholder ownership and other requirements up until May 25, 2016. Our U.S. subsidiary was subject to a 30% or 35% withholding tax on distributions of its U.S. taxable income to Canada. We did not distribute any withholding taxes paid or payable to our unitholders related to the disposition. Should RioCan’s U.S. subsidiary no longer qualify as a U.S. REIT for U.S. tax purposes prior to May 25th, 2016, certain statements contained in this MD&A may need to be modified.

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 stable retail environment; relatively low and stable interest costs; a continuing trend toward land use intensification, 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; and 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. For a description of additional risks that could cause actual results to materially differ from management’s current expectations, refer to Risks and Uncertainties in RioCan's MD&A for the period ended December 31, 2017 and Risks and Uncertainties in RioCan’s AIF. Although the forward-looking information contained in RioCan's MD&A for the period ended December 31, 2017 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.

Certain statements included in this News Release may be considered “financial outlook” for purposes of applicable Canadian securities laws, and as such the financial outlook may not be appropriate for purposes other than this News Release. The forward-looking information contained in this News Release is made as of the date of this News Release, 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
Qi Tang
Senior Vice President and Chief Financial Officer
416-866-3033
www.riocan.com