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Press release from Marketwire

RioCan Real Estate Investment Trust Announces Completion of Sheppard Centre and Alamo Ranch Purchases

Monday, December 05, 2011

RioCan Real Estate Investment Trust Announces Completion of Sheppard Centre and Alamo Ranch Purchases08:30 EST Monday, December 05, 2011TORONTO, ONTARIO--(Marketwire - Dec. 5, 2011) - RioCan Real Estate Investment Trust ("RioCan") (TSX:REI.UN) is pleased to announce that RioCan has completed the purchase of the Sheppard Centre on a 50/50 joint venture basis with its partner KingSett Capital. RioCan also purchased Alamo Ranch in San Antonio Texas on an 80/20 joint venture basis with Inland Western Retail REIT ("Inland Western") (80% RioCan / 20% Inland Western). On December 1, 2011, RioCan completed the acquisition of Sheppard Centre. Sheppard Centre, located at the northeast corner of Yonge and Sheppard, is a 673,000 square foot urban mixed use centre that contains retail, office, and residential uses. RioCan purchased the property on a 50/50 joint venture basis with KingSett Capital at a purchase price of $218 million at 100% ($109 million at RioCan's interest). $190 million has been allocated to the income producing property and $28 million has been allocated to the excess residential density. The capitalization rate on year one income is 6.11%. RioCan will manage the property, act as leasing manager for the property and will be development manager in connection with any redevelopment of the property on a market fee basis. RioCan has entered into a new US$67.5 million bank credit facility to fund part of its portion of the purchase price. The retail portion of the property has a weighted average lease term of 5.3 years, is 96.1% leased, and contains 257,039 square feet of retail space on four levels. The major tenants in the retail portion of the property are Cineplex, Winners, Shoppers Drug Mart, Bank of Montreal, CIBC, and TD Canada Trust. The office portion of the property has a weighted average lease term of 6.8 years, is 100% leased, and contains 415,815 square feet of office space in two towers, 19 and 9 storeys, respectively. Major tenants in the office portion of the property include Bank of Montreal and Aon Hewitt, who together lease approximately 82% of the office space. The property has direct access to both the Yonge and Sheppard subway lines and has three levels of underground parking that can accommodate more than 2,100 vehicles. Beyond the current retail and office uses, this property also has the potential for additional intensification through retail expansion and the addition of a residential/condominium component.Recent Acquisition Activities - United States On December 2, 2011, RioCan completed the purchase of Alamo Ranch, located in San Antonio, Texas. This is RioCan's first acquisition in the San Antonio market. RioCan's strategy has been to focus on the four large urban markets (Dallas-Fort Worth, Houston, San Antonio, and Austin) in Texas. The 465,000 square foot property was built in 2008. The centre is 88% occupied and has a weighted average lease term of 6.6 years. The property is shadow anchored by Target, JC Penney and Lowe's. Major tenants at the property include Best Buy, Marshalls, Ross Dress for Less, and Dick's Sporting Goods. The property was acquired on an 80/20 joint venture basis with Inland Western (80% RioCan / 20% Inland Western) for US$93.0 million (at 100%) or US$74.4 million at RioCan's interest, which equates to a cap rate of 7.2%. The property was acquired free and clear of financing. The joint venture is in the process of securing conventional third party financing.About RioCan RioCan is Canada's largest real estate investment trust with a total capitalization of approximately $11.9 billion as at September 30, 2011. It owns and manages Canada's largest portfolio of shopping centres with ownership interests in a portfolio of 314 retail properties, including 10 under development, containing an aggregate of over 75 million square feet. RioCan owns an interest in 38 grocery anchored and new format retail centres in the United States through various joint venture arrangements. For further information, please refer to RioCan's website at www.riocan.com. FOR FURTHER INFORMATION PLEASE CONTACT: Rags DavloorRioCan Real Estate Investment TrustSenior Vice President & CFO(416) 642-3554www.riocan.com