SmartCentres Real Estate Investment Trust Releases Third Quarter Results for 2025

Company Website: https://smartcentres.com/ TORONTO -- (Business Wire) SmartCentres Real Estate Investment Trust (“SmartCentres”, the “Trust” or the “REIT”) (TSX: SRU.UN) is pleased to report its financial and operating results for the quarter ended September 30, 2025. “We are pleased to report another strong quarter of operating and financial results, highlighted by stable retail fundamentals with robust momentum in leasing demand and executed lease deals for both existing and new build space,” said Mitchell Goldhar, CEO of SmartCentres. “We renewed and extended lease maturities in 2025 at rental growth rates of 8.4%, excluding anchors. In-place and committed occupancy remained steady at an industry-leading 98.6%. We expect to continue delivering healthy rental growth for the balance of the year. Another positive metric during the quarter was same property NOI growth, despite a credit provision primarily associated with one retail tenant. Our development pipeline continues to grow with two self-storage facilities in Quebec expected to open in 2026 and two additional self-storage facilities in British Columbia expected to open in 2027. Subsequent to the quarter end, we raised $500 million via a two-tranche term debenture which will be used to repay an upcoming $350 million debenture maturity with the remainder repaying outstanding floating rate debt on our operating lines, on an accretive basis while filling gaps in our debt ladder and extending the average term to maturity of our debt.” 2025 Third Quarter Highlights Retail Operations Industry-leading in-place and committed occupancy rate of 98.6% as of September 30, 2025 and unchanged from the prior quarter. Robust customer traffic and a solid tenant base continued to drive Same Properties NOI(1) growth for the three months ended September 30, 2025, which increased by 4.6%, excluding Anchors, compared to the same period in 2024. Leasing momentum remained resilient, with approximately 68,000 square feet of vacant space leased during the quarter, resulting in a total of approximately 394,000 square feet leased year to date. In addition, growing demand for new-build retail continues with 24,944 square feet executed during the quarter, resulting in a total of approximately 92,000 square feet executed year to date. Lease renewals continued to perform well, with near 85% of all leases maturing in 2025 extended or finalized, with strong rent growth of 8.4% (excluding Anchors) and 6.2% (including Anchors). Development The Trust has opened three new self-storage facilities in 2025 at Toronto (Gilbert Ave.), Toronto (Jane St.), and Dorval (St-Regis Blvd.) bringing the total number of operating self-storage properties in the portfolio to 14. Construction of self-storage facilities is underway at Montreal (Notre Dame St. W), and Laval E, Quebec, with opening expected in 2026. Site preparation and demolition works completed at Burnaby, British Columbia, with building construction expected to commence in Q4 2025. Site preparation work is also underway in Victoria, British Columbia. Both projects are expected to open in 2027. In addition, the Trust is in the process of obtaining municipal approval for a newly acquired self-storage site in Edmonton, Alberta. Construction of Phase I of the Vaughan NW townhomes is mostly completed, with 13 units closed in Q3 2025. As at September 30, 2025, a total of 111 out of the 120 units in Phase I have closed. Construction of the ArtWalk condo Tower A in the Vaughan Metropolitan Centre continues to advance as planned, with approximately 93% of the 340 units pre-sold. The underground parking structure is progressing, the slab-on-grade has been completed, and preparations are underway for the first section of the ground floor slab. Construction of the Trust’s flagship 200,000 square foot Canadian Tire store on Laird Drive in Toronto continues on schedule, with possession expected in Q2 2026. Financial Net rental income and other for the three months ended September 30, 2025 was $141.3 million, representing a decrease of $0.6 million or 0.5% compared to the same period in 2024. This net decrease was primarily driven by lower residential sales due to fewer townhomes closings offset by an increase in base rent from retail properties compared to the same period in 2024. FFO per Unit(1) for the three months ended September 30, 2025, was $0.59 compared to $0.71 for the same period in 2024. The decrease was primarily due to changes in the fair value adjustment on the TRS resulting from fluctuations in the Trust’s Unit price. FFO with adjustments per Unit(1) for the three months ended September 30, 2025, was $0.56 compared to $0.53 for the same period in 2024. The increase was primarily attributable to an increase in NOI primarily due to lease-up activities for retail properties. Net income and comprehensive income(1) for the three months ended September 30, 2025, increased by $38.6 million compared to the same period in 2024. The increase was mainly attributable to a $36.6 million increase in the fair value adjustment on financial instruments for the period, primarily due to mark-to-market adjustments for the interest rate swaps and the fair value change in units classified as liabilities due to an increase in the Trust’s Unit Price. (1)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release. Selected Consolidated Operational, Mixed-Use Development and Financial Information (in thousands of dollars, except per Unit and other non-financial data)         As at   September 30, 2025 December 31, 2024 September 30, 2024 Portfolio Information (Number of properties)         Retail properties   155   155   155   Office properties   4   4   4   Self-storage properties   14   11   10   Residential properties   3   3   3   Industrial properties   1   1   1   Properties under development   20   21   22   Total number of properties with an ownership interest   197   195   195   Leasing and Operational Information(1)         Gross leasable retail, office and industrial area (in thousands of sq. ft.)   35,593   35,300   35,282   In-place and committed occupancy rate   98.6 % 98.7 % 98.5 % Average lease term to maturity (in years)   4.4   4.2   4.3   In-place net retail rental rate excluding Anchors (per occupied sq. ft.)   $24.09   $23.48   $23.13   Financial Information         Investment properties(2)   10,776,346   10,659,783   10,606,288   Total unencumbered assets(3)   9,847,321   9,464,521   9,366,921   NAV per Unit - diluted(3)   $35.70   $36.03   $35.79   Debt to Aggregate Assets(3)(4)(5)   44.4 % 43.7 % 43.6 % Adjusted Debt to Adjusted EBITDA(3)(4)(5)   9.6X   9.6X   9.8X   Weighted average interest rate(3)(4)   3.94 % 3.92 % 4.09 % Weighted average term of debt (in years)   2.9   3.1   3.2   Interest coverage ratio(3)(4)   2.6X   2.5X   2.4X               Three Months Ended September 30 Nine Months Ended September 30   2025   2024   2025   2024   Financial Information         Rentals from investment properties and other(2) 226,690   243,326   679,743   688,616   Net income and comprehensive income(2) 81,037   42,479   180,642   150,220   FFO(3)(4)(6) 107,364   128,174   315,403   305,911   AFFO(3)(4)(6) 86,754   109,619   282,990   274,392   Cash flows provided by operating activities(2) 90,905   105,380   250,097   252,090   Net rental income and other(2) 141,337   141,978   419,468   405,928   NOI(3)(4) 149,051   148,785   441,854   423,922   Change in SPNOI(3)(4) 2.6 % 4.9 % 3.7 % 2.4 % Change in SPNOI excluding anchors(3)(4) 4.6 % 8.2 % 5.9 % 4.0 % Weighted average number of units outstanding – diluted(7) 182,172,590   180,858,726   181,881,488   180,602,179   Net income and comprehensive income per Unit(2) $0.45/$0.44   $0.24/$0.23   $1.01/$0.99   $0.84/$0.83   FFO per Unit(3)(4)(6) $0.60/$0.59   $0.72/$0.71   $1.77/$1.73   $1.72/$1.69   FFO with adjustments per Unit(3)(4) $0.57/$0.56   $0.54/$0.53   $1.68/$1.64   $1.58/$1.56   AFFO per Unit(3)(4)(6) $0.49/$0.48   $0.61/$0.61   $1.59/$1.56   $1.54/$1.52   AFFO with adjustments per Unit(3)(4) $0.45/$0.44   $0.44/$0.43   $1.50/$1.47   $1.40/$1.39   Payout Ratio to AFFO(3)(4)(6) 95.1 % 75.2 % 87.4 % 90.1 % Payout Ratio to AFFO with adjustments(3)(4) 102.2 % 105.9 % 92.8 % 98.8 % Payout Ratio to cash flows provided by operating activities 90.7 % 78.2 % 98.9 % 98.1 % (1)   Excluding residential and self-storage areas. (2)   Represents a Generally Accepted Accounting Principles (“GAAP”) measure. (3)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release. (4)   Includes the Trust’s proportionate share of equity accounted investments. (5)   As at September 30, 2025, cash-on-hand of $22.2 million was excluded for the purposes of calculating the applicable ratios (December 31, 2024 – $34.9 million, September 30, 2024 – $31.4 million). (6)   The calculation of the Trust’s FFO and AFFO and related payout ratios, including comparative amounts, are financial metrics that were determined based on the REALPAC White Paper on FFO and AFFO issued in January 2022 (“REALPAC White Paper”). Comparison with other reporting issuers may not be appropriate. The payout ratio to AFFO is calculated as declared distributions divided by AFFO. (7)   The diluted weighted average includes the vested portion of the deferred units issued pursuant to the deferred unit plan, and vested EIPs granted pursuant to the equity incentive plan. Development and Intensification Summary The following table provides additional details on the Trust’s 8 development initiatives that are currently under construction or where initial siteworks have begun (in order of estimated initial occupancy/closing date): Projects under construction (Location/Project Name) Type Trust’s share Actual / estimated initial occupancy / closing date % of capital spend GFA(1) (sq. ft.) No. of residential units               Mixed-use Developments             Vaughan NW (Phase I & II) Townhomes 50% Q1 2024 67% 366,000 174 Montreal (Notre-Dame) Self-storage 50% Q2 2026 51% 184,000 N/A Laval East Self-storage 50% Q2 2026 38% 176,000 N/A Burnaby Self-storage 50% Q2 2027 25% 137,000 N/A Victoria Self-storage 50% Q3 2027 26% 164,000 N/A Vaughan / ArtWalk Condo 50% Q3 2027 39% 300,000 340 Ottawa SW Residential Apartments 50% Q3 2027 30% 361,000 425 Total Mixed-use Developments         1,688,000 939 Retail Development             Toronto (Laird) Retail 50% Q2 2026 62% 225,000 N/A (1)   GFA represents Gross Floor Area. Reconciliations of Non-GAAP Measures The following tables reconcile the non-GAAP measures to the most comparable GAAP measures for the three and nine months ended September 30, 2025, and the comparable period in 2024. Such measures do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures disclosed by other issuers. Net Operating Income (including the Trust’s Interests in Equity Accounted Investments) (in thousands of dollars) Three Months Ended September 30, 2025 Three Months Ended September 30, 2024   GAAP Basis Proportionate Share Reconciliation Total Proportionate Share(1) GAAP Basis Proportionate Share Reconciliation Total Proportionate Share(1) Net rental income and other             Rentals from investment properties and other $219,782   $13,329   $233,111   $211,737   $12,001   $223,738   Property operating costs and other (78,854 ) (6,047 ) (84,901 ) (75,763 ) (5,188 ) (80,951 )   $140,928   $7,282   $148,210   $135,974   $6,813   $142,787   Residential sales revenue and other(2) 6,908   76   6,984   31,589   16   31,605   Residential cost of sales and other (6,499 ) 356   (6,143 ) (25,585 ) (22 ) (25,607 )   $409   $432   $841   $6,004   $(6 ) $5,998   NOI $141,337   $7,714   $149,051   $141,978   $6,807   $148,785   (in thousands of dollars) Nine Months Ended September 30, 2025 Nine Months Ended September 30, 2024   GAAP Basis Proportionate Share Reconciliation Total Proportionate Share(1) GAAP Basis Proportionate Share Reconciliation Total Proportionate Share(1) Net rental income and other             Rentals from investment properties and other $665,876   $39,282   $705,158   $638,755   $34,195   $672,950   Property operating costs and other (250,122 ) (17,721 ) (267,843 ) (241,384 ) (16,073 ) (257,457 )   $415,754   $21,561   $437,315   $397,371   $18,122   $415,493   Residential sales revenue and other(2) 13,867   151   14,018   49,861   82   49,943   Residential cost of sales and other (10,153 ) 674   (9,479 ) (41,304 ) (210 ) (41,514 )   $3,714   $825   $4,539   $8,557   $(128 ) $8,429   NOI $419,468   $22,386   $441,854   $405,928   $17,994   $423,922   (1)   This column contains non-GAAP measures because it includes figures that are recorded in equity accounted investments. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release. (2)   Includes additional partnership profit and other revenues. Same Properties NOI   Three Months Ended September 30 Nine Months Ended September 30 (in thousands of dollars) 2025   2024   2025   2024   Net rental income and other $141,337   $141,978   $419,468   $405,928   NOI from equity accounted investments(1) 7,714   6,807   22,386   17,994   Total portfolio NOI before adjustments(1) $149,051   $148,785   $441,854   $423,922   Adjustments:         Lease termination (955 ) (476 ) (1,409 ) (1,068 ) Net profit on condo and townhome closings (841 ) (5,998 ) (4,539 ) (8,429 ) Other adjustments(2) 11   1,432   1,685   4,134   Total portfolio NOI after adjustments(1) $147,266   $143,743   $437,591   $418,559   NOI sourced from acquisitions, dispositions, Earnouts and developments (979 ) (1,116 ) (6,586 ) (2,794 ) Same Properties NOI(1) $146,287   $142,627   $431,005   $415,765   (1)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release. (2)   Includes items such as adjustments relating to royalties, straight-line rent and amortization of tenant incentives. Reconciliation of FFO   Three Months Ended September 30 Nine Months Ended September 30 (in thousands of dollars) 2025   2024   2025   2024   Net income and comprehensive income $81,037   $42,479   $180,642   $150,220   Add (Deduct):         Fair value adjustment on investment properties and financial instruments(1) 10,170   49,217   78,085   113,054   Gain on derivative – TRS 5,428   25,815   12,303   15,672   Gain (Loss) on sale of investment properties (1,031 ) (22 ) (1,038 ) 120   Amortization of intangible assets and tenant improvement allowance 2,347   2,384   7,161   6,821   Distributions on Units classified as liabilities and vested deferred units and EIP 5,381   4,844   15,818   14,218   Salaries and related costs attributed to leasing activities(2) 2,086   2,562   6,559   7,270   Adjustments relating to equity accounted investments(3) 1,946   895   15,873   (1,464 ) FFO(4) $107,364   $128,174   $315,403   $305,911   Add (Deduct) non-recurring adjustments:         Gain on derivative – TRS (5,428 ) (25,815 ) (12,303 ) (15,672 ) FFO sourced from condo and townhome closings (842 ) (6,004 ) (4,540 ) (8,557 ) Transactional FFO – sale of land(4) 184   —   354   —   FFO with adjustments(4) $101,278   $96,355   $298,914   $281,682   (1)   Includes fair value adjustments on investment properties and financial instruments. Fair value adjustment on investment properties is described in “Investment Properties” in the Trust’s MD&A. Fair value adjustment on financial instruments comprises the following financial instruments: units classified as liabilities, Deferred Unit Plan (“DUP”), Equity Incentive Plan (“EIP”), TRS, and interest rate swap agreements. The significant assumptions made in determining the fair value are more thoroughly described in the Trust’s unaudited interim condensed consolidated financial statements for the three and nine months ended September 30, 2025. For details, please see discussion in “Results of Operations” section in the MD&A. (2)   Salaries and related costs attributed to leasing activities of $6.6 million were incurred in the nine months ended September 30, 2025 (nine months ended September 30, 2024 – $7.3 million) and were eligible to be added back to FFO based on the definition of FFO, in the REALPAC White Paper, which provided for an adjustment to incremental leasing expenses for the cost of salaried staff. This adjustment to FFO results in more comparability between Canadian publicly traded real estate entities that expensed their internal leasing departments and those that capitalized external leasing expenses. (3)   Includes tenant improvement amortization, indirect interest with respect to the development portion, fair value adjustment on investment properties, loss (gain) on sale of investment properties, and adjustment for supplemental costs. (4)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For definitions and basis of presentation of the Trust’s non-GAAP measures, refer to “Presentation of Certain Terms Including Non-GAAP Measures” and “Non-GAAP Measures” in the MD&A. Reconciliation of AFFO   Three Months Ended September 30 Nine Months Ended September 30 (in thousands of dollars) 2025   2024   2025   2024   FFO(1) $107,364   $128,174   $315,403   $305,911   Add (Deduct):         Straight-line rents (1,873 ) (1,154 ) (3,761 ) (2,854 ) Adjusted salaries and related costs attributed to leasing (2,086 ) (2,562 ) (6,559 ) (7,270 ) Capital expenditures, leasing commissions, and tenant improvements (16,651 ) (14,839 ) (22,093 ) (21,395 ) AFFO(1) $86,754   $109,619   $282,990   $274,392   Add (Deduct) non-recurring adjustments:         Gain on derivative – TRS (5,428 ) (25,815 ) (12,303 ) (15,672 ) FFO sourced from condo and townhome closings (842 ) (6,004 ) (4,540 ) (8,557 ) Transactional FFO – sale of land(1) 184   —   354   —   AFFO with adjustments(1) $80,668   $77,800   $266,501   $250,163   (1)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release. Adjusted EBITDA The following table presents a reconciliation of net income and comprehensive income to Adjusted EBITDA:   Rolling 12 Months Ended (in thousands of dollars) September 30, 2025 September 30, 2024 Net income and comprehensive income $322,489   $164,385 Add (Deduct) the following items:     Net interest expense 194,807   186,607 Amortization of equipment, intangible assets and tenant improvements 12,399   12,069 Fair value adjustments on investment properties and financial instruments 32,093   170,039 Adjustment for supplemental costs 4,098   3,770 Loss (Gain) on sale of investment properties (1,087 ) 53 Adjusted EBITDA(1) $564,799   $536,923 (1)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release. Net Asset Value (in thousands of dollars, except per Unit information) September 30, 2025 December 31, 2024 Total equity $6,294,925 $6,337,581 LP Units classified as liabilities 209,609 191,665 NAV(1) $6,504,534 $6,529,246 Units outstanding - diluted(2) 182,187,277 181,205,536 NAV per Unit - diluted(1) $35.70 $36.03 (1)   Represents a non-GAAP measure. The Trust’s method of calculating non-GAAP measures may differ from other reporting issuers’ methods and, accordingly, may not be comparable. For additional information, please see “Non-GAAP Measures” in this Press Release. (2)   Total diluted Units outstanding include Trust Units and LP Units, including Units classified as liabilities, vested portion of the deferred units issued pursuant to the deferred unit plan and vested EIPs granted pursuant to the equity incentive plan. Conference Call Management will hold a conference call on Thursday, November 13, 2025 at 3:00 p.m. (ET). Interested parties are invited to access the call by dialing 1-855-353-9183 and then keying in the participant access code 50957#. A recording of this call will be made available Thursday, November 13, 2025 through to Thursday, November 20, 2025. To access the recording, please call 1-855-201-2300, enter the conference access code 50957# and then key in the playback access code 50957#. About SmartCentres SmartCentres is one of Canada’s largest fully integrated REITs, with a best-in-class and growing mixed-use portfolio featuring 197 strategically located properties in communities across the country. SmartCentres has approximately $12.1 billion in assets and owns 35.6 million square feet of income producing value-oriented retail and first-class office properties with 98.6% in place and committed occupancy, on 3,500 acres of owned land across Canada. Non-GAAP Measures The non-GAAP measures used in this Press Release, including but not limited to, AFFO, AFFO with adjustments, AFFO per Unit, AFFO with adjustments per Unit, Payout Ratio to AFFO, Payout Ratio to AFFO with adjustments, Unencumbered Assets, NOI, Debt to Aggregate Assets, Interest Coverage Ratio, Adjusted Debt to Adjusted EBITDA, Unsecured/Secured Debt Ratio, FFO, FFO with adjustments, FFO per Unit, FFO with adjustments per Unit, Net Asset Value (“NAV”), Same Properties NOI, Same Properties NOI excluding Anchors, Debt to Gross Book Value, Weighted Average Interest Rate, Transactional FFO, and Total Proportionate Share, do not have any standardized meaning prescribed by International Financial Reporting Standards (“IFRS”) and are therefore unlikely to be comparable to similar measures presented by other issuers. Additional information regarding these non-GAAP measures is available in the Management’s Discussion and Analysis of the Trust for the three and nine months ended September 30, 2025, dated November 12, 2025 (the “MD&A”), and is incorporated by reference. The information is found in the “Presentation of Certain Terms Including Non-GAAP Measures” and “Non-GAAP Measures” sections of the MD&A, which is available on SEDAR+ at www.sedarplus.ca. Reconciliations of non-GAAP financial measures to the most directly comparable IFRS measures are found in “Reconciliations of Non-GAAP Measures” of this Press Release. Full reports of the financial results of the Trust for the three and nine months ended September 30, 2025 are outlined in the unaudited interim condensed consolidated financial statements and the related MD&A of the Trust for the three and nine months ended September 30, 2025, which are available on SEDAR+ at www.sedarplus.ca. Cautionary Statements Regarding Forward-looking Statements Certain statements in this Press Release are "forward-looking statements" that reflect management's expectations regarding the Trust's future growth, results of operations, performance and business prospects and opportunities. More specifically, certain statements including, but not limited to, statements related to SmartCentres’ expectations relating to cash collections, SmartCentres’ expected or planned development plans and joint venture projects, including the described type, scope, costs and other financial metrics and the expected timing of construction and condo closings and statements that contain words such as "could", "should", "can", "anticipate", "expect", "believe", "will", "may" and similar expressions and statements relating to matters that are not historical facts, constitute "forward-looking statements". These forward-looking statements are presented for the purpose of assisting the Trust's Unitholders and financial analysts in understanding the Trust's operating environment and may not be appropriate for other purposes. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. However, such forward-looking statements involve significant risks and uncertainties. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including risks associated with potential acquisitions not being completed or not being completed on the contemplated terms, public health crises, real property ownership and development, debt and equity financing for development, interest and financing costs, construction and development risks, and the ability to obtain commercial and municipal consents for development. These risks and others are more fully discussed under the heading “Risks and Uncertainties” and elsewhere in SmartCentres’ most recent Management’s Discussion and Analysis, as well as under the heading “Risk Factors” in SmartCentres’ most recent annual information form. Although the forward-looking statements contained in this Press Release are based on what management believes to be reasonable assumptions, SmartCentres cannot assure investors that actual results will be consistent with these forward-looking statements. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. These forward-looking statements are made as at the date of this Press Release and SmartCentres assumes no obligation to update or revise them to reflect new events or circumstances unless otherwise required by applicable securities legislation. 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; a continuing trend toward land use intensification, including residential development in urban markets and continued growth along transportation nodes; 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; that requisite consents for development will be obtained in the ordinary course, construction and permitting costs consistent with the past year and recent inflation trends. View source version on businesswire.com: https://www.businesswire.com/news/home/20251112802827/en/ Contacts: For information, visit www.smartcentres.com or please contact: Mitchell Goldhar Executive Chairman and CEO (905) 326-6400 ext. 7674 [email protected] Peter Slan Chief Financial Officer (905) 326-6400 ext. 7571 [email protected] Source: SmartCentres Real Estate Investment Trust