Primaris REIT Announces $565 Million Acquisition of Promenades St-Bruno; Raises Guidance; and Launches REIT Unit Offering

Executive Summary

• Primaris Real Estate Investment Trust (TSX: PMZ.UN) has agreed to acquire a 100% interest in Promenades St-Bruno, a major shopping centre in Montreal, Quebec, from Cadillac Fairview for an aggregate consideration of $565.0 million.
• The transaction is funded via a combination of cash and equity, with the equity portion satisfied through a concurrent bought-deal public offering of REIT Units.
• The acquisition is expected to be accretive to FFO per unit, triggers an upward revision to 2025 financial guidance, and is scheduled to close on October 10, 2025.

Key Details

• Transaction Structure & Consideration:
  • Total Aggregate Consideration: $565.0 million.
  • Cash Component: $320.0 million.
  • Equity Component: $245.0 million, comprised of:
    • $160.0 million in Series A Units (Consideration Units) at an issue price of $21.40 per unit.
    • $85.0 million in 6.00% exchangeable preferred units (Preferred LP Units) in a subsidiary limited partnership, exchangeable into Series A Trust Units at the Issue Price.
• Concurrent Equity Offering:
  • Primaris entered into a bought-deal agreement to issue 10,000,000 REIT Units at $14.75 per unit.
  • Gross Proceeds: Approximately $147.5 million.
  • Over-Allotment Option: Underwriters granted an option to purchase up to 1,448,599 additional units.
  • Maximum Gross Proceeds (if over-allotment exercised): Approximately $168.9 million.
  • Use of Proceeds: Net proceeds from the Offering will be paid to the Vendor (Cadillac Fairview) in full satisfaction of the Equity Consideration ($160M Series A Units + $85M Preferred LP Units).
  • Impact on Unit Count: Diluted unit count increases by ~9%; basic unit count increases by ~11%.
• Target Asset (Promenades St-Bruno):
  • Location: Montreal, Quebec (affluent south shore, adjacent to Saint Bruno Exo train station).
  • Size: 1,096,200 sq ft mall on 154 acres of land (11% site coverage).
  • Financials: $271 million annual CRU sales volume; $917 per square foot same store sales productivity.
  • Occupancy: 74.8% long-term in-place; 81.4% in-place; 83.3% committed (excluding vacant HBC space).
  • NOI Growth Potential: Opportunities to re-lease ~130,600 sq ft of former anchor space and ~73,000 sq ft of vacant/CRU space.
• Financial Impact & Guidance Updates:
  • FFO Accretion: Expected to be approximately $0.04 accretive to annualized fully diluted FFO per unit.
  • Leverage: Average Net Debt to Adjusted EBITDA expected to remain within target range of 4.0x to 6.0x.
  • Updated 2025 Guidance:
    • FFO per unit raised from $1.74–$1.79 to $1.78–$1.82 (fully diluted).
    • Same Property Cash NOI growth raised from 3.0–4.0% to 4.0–5.0%.
    • Cash NOI anticipated to be $352 million to $357 million (up from previous $340–$345 million).
• Closing Conditions:
  • Expected Closing Date: October 10, 2025.
  • Subject to customary closing conditions and TSX approval.
  • If over-allotment is not fully exercised, Primaris must fund the cash difference via credit facilities.

Notable Quotes

• Patrick Sullivan, President and Chief Operating Officer: “Promenades St-Bruno has all the characteristics which Primaris targets in acquisitions: over $271 million in annual sales, $917 in sales per square foot, and 154 acres of land in Canada’s second largest and growing market of Montreal, adjacent to mass transit.”
• Alex Avery, Chief Executive Officer: “Primaris’ high quality acquisitions exceed $1.5 billion in 2025 and $3.3 billion since 2021... The concurrent equity offering increases Primaris’ public float and enhances the trading liquidity of Primaris’ units, to the benefit of all unitholders.”