RioCan REIT has plans to redevelop several of its retail properties into apartments, to capitalize on the rental boom and insulate RioCan from the rise of e-commerce, according to Bloomberg.
“There’s less demand for retail space but there’s a lot of demand for great residential apartments,” said Ed Sonshine, RioCan CEO, to Bloomberg. “So I said, well, let’s just rip down all, or part of, our shopping centers and replace it with medium-rise or, depending on location, even high-rise apartments and then just put new retail on the ground floors of those buildings because there still is retail demand, it’s just very different.”
The REIT has been downsizing. It is under firm agreements for approximately C$512 million ($402 million) of properties with C$200 million ($157 million) more under conditional contract. RioCan is planning to sell about 100 of its 289 properties altogether.
Part of the revenue used from RioCan’s sales will go toward the development of as many as 10,000 residential units in Canada’s major markets, called “RioCan Living.”