Primaris REIT sees hike in total rental revenue in Q1

Primaris Real Estate Investment Trust announced Wednesday financial and operating results for the first quarter ended March 31, 2026, showing total rental revenue rising to $177.0 million in the quarter from $150.2 million a year ago.

Financial and Operating Results Highlights

• $177.0 million total rental revenue;
• $734 per square foot total same stores sales productivity;
• -2.1% change in Same Properties Cash Net Operating Income growth (or +1.7% excluding the $2.5 million prior year property tax recoveries recorded in 2025);
• 89.9% committed occupancy, 86.4% in-place occupancy (including vacancy from disclaimed HBC locations of 1.0 million square feet), and 82.4% long-term in-place occupancy;
• 78.5% combined recovery ratio;
• +5.5% weighted average spread on renewing net rents across 372,000 square feet;
• 154 CRU lease deals across 288,000 square feet at average net rents of $53.60;
• -3.2% change in Funds from Operations per average diluted unit to $0.425; (or +1.6% excluding the $2.5 million prior year property tax recoveries recorded in 2025);
• 51.8% FFO Payout Ratio;
• $41.9 million in net income;
• $5.3 billion total assets;
• 6.0x Average Net Debt to Adjusted EBITDA;
• $626.8 million in liquidity;
• $4.8 billion in unencumbered assets; and
• $21.50 Net Asset Value per unit outstanding.

“The quarter reflected strong leasing and operational execution across the portfolio,” said Patrick Sullivan, President and Chief Operating Officer. “Leasing velocity accelerated, with a high volume of lease deals completed at higher rents, while solid CRU occupancy across the portfolio continued to be supported by sustained tenant demand and strong retail fundamentals. At former HBC locations, the team is making continued progress and moving closer to solidifying leasing deals across a number of sites. The leasing activity underway will support structurally higher internal growth over time.”

“Our first quarter results reinforce the durability of Primaris’ cash flows and the strength of our financial position,” said Alex Avery, Chief Executive Officer. “The portfolio continues to generate solid operating performance, supported by robust leasing activity, and resilient occupancy. With strong liquidity, very low leverage, and a low payout ratio, we are well positioned to fund internal growth, enhance portfolio quality, and create long‑term value for our unitholders.”

Rags Davloor, Chief Financial Officer added: “Our low leverage, low payout ratio model is a critical pillar to our strategy. We have significant liquidity with the full availability on our unsecured credit facility with no debt maturing in 2026. The recent credit rating confirmation of BBB high with a stable trend underscores the continued resiliency of our financial profile. Combined with our disciplined approach to capital allocation, these factors provide us with the flexibility to support reinvestment into our platform, future acquisitions, and NCIB activity.”

Primaris said its leasing activities are focused on driving value by actively managing the tenant and merchandising mix at its investment properties.

In-place occupancy for the portfolio decreased 6.8% from March 31, 2025 to 86.4% at March 31, 2026.

In-place occupancy for same properties decreased 4.6% from March 31, 2025 to 89.4% at March 31, 2026. The disclaimed HBC leases negatively impacted occupancy for Same Properties by approximately 4.2% compared to March 31, 2025.

Average in-place occupancy is calculated by averaging the occupied square feet and total GLA for each month in the measurement period. For the three months ended March 31, 2026, the average in-place occupancy rate was 86.1%, a decrease of 7.2% compared to March 31, 2025, due to the impact of the Acquisitions and the disclaimed HBC leases, it said.

HBC Exposure

“Primaris has full control of all 1.3 million square feet of former HBC GLA and has accelerated negotiations with retailers. The Trust’s leasing strategy is twofold: firstly, execute long term leases with single tenant and multi-tenant configurations, (“Re-leasing Plans”) where appropriate; and secondly, repurpose and subdivide space (“Redevelopment Plans”), to accommodate multiple large format tenants, and/or high-value CRU. While design, permitting, and planning activities are underway, Primaris is executing short-term leases with reputable tenants to restore rental income until Re-leasing Plans and Redevelopment Plans are executed,” it said.

“With strong demand from retailers for space and improved visibility into Primaris’ Redevelopment Plans, management now anticipates the retention and redevelopment of a greater portion of the former HBC space than previously contemplated. Management anticipates retaining approximately 90% of the former HBC space. Approximately 35% of this space is under committed or conditional leasing and the remainder is in advanced negotiations with retailers. The capital investment to redevelop this space is expected to be in the range of $175 million to $225 million. Management’s current estimates and assumptions are subject to change.”

The following table illustrates Primaris’ anticipated Re-leasing and Redevelopment Plans for the 11 former HBC locations.

Primaris is Canada’s only enclosed shopping centre focused REIT, with ownership interests in leading enclosed shopping centres located in growing Canadian markets. The current portfolio totals 15.1 million square feet, valued at approximately $5.2 billion at Primaris’ share.

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