- What Primaris REIT is purchasing the 793,000 sq ft Lime Ridge Mall
- Why The $416m price is coming from a mix of cash and equity
- What next The property generates over $251m in sales annually
In Canada’s biggest single-property retail transaction this year, Primaris Real Estate Investment Trust is acquiring the iconic Lime Ridge Mall in Hamilton for $416m.
The REIT announced a deal to buy the 793,000 sf ft shopping centre from Cadillac Fairview on Monday, and the deal could close as soon as today. The property, at 999 Upper Wentworth Street, is by far the largest retail property in the city.
Primaris will pay $235m in cash, along with $181m in equity coming from a public stock offering.
The purchase would be the second-largest retail deal of the year in total value, according to Green Street’s Sales Comps Database. The high-water mark is also held by Primaris, which paid $585m in February for a 2m sq ft retail portfolio centred on properties in Edmonton and Oshawa, Ont., for $585m. The seller was Ivanhoé Cambridge, now known as La Caisse.
Lime Ridge Mall, on 65 acres, is set to become the fourth-largest mall in Primaris’ portfolio. It generates more than $251m of sales annually. Additional revenue can be generated by leasing more than 266,000 sq ft of anchor-retail space left vacant by the departure of the bankrupt Sears department store chain. In addition, there’s another 53,000 sq ft of space either lying empty or temporarily tenanted.
The current rent roll includes Sport Chek, Urban Planet, Shoppers Drug Mart, Aritzia and JD Sports. The average weighted lease term is five years, and the mall is projecting a long-term occupancy of around 60%.
In addition to around $20m of capital renovations completed since 2015, a redeveloped and expanded bus terminal is planned for the property, with work expected to kick off this year.
Headquartered in Toronto, Primaris focuses exclusively on domestic enclosed shopping mall investments. The REIT has 15m sq ft of retail space.
