Q2 2025 Primaris Real Estate Investment Trust Earnings Call

I will now turn the call over to Claire Mahaney, Vice President Investor Relations and ESG. Please go ahead.

Thank you operator during this call management of Prime merits reach may make statements containing forward looking information within the meaning of applicable securities legislation.

Forward looking information is based on a number of assumptions and are subject to a number of risks and uncertainties many of which are beyond primary suites control.

That could cause actual results to differ materially from those that are disclosed in or implied by such forward looking information.

Additional information about these assumptions risks and uncertainties are contained in <unk> filings with securities regulators.

These filings are also available on our website.

At Www Dot primary <unk> dot com.

Now I'll turn the call over to Alex Avery primaries, as Chief Executive Officer.

Thank you Claire.

Good morning. Thanks.

Thanks for joining primarily.

<unk> quarter 2020 conference call joining.

Joining me today are Pat Sullivan, President and Chief operating Officer, Regs, Doublure, Chief Financial Officer, Leslie abuse, SVP Finance 40, Bobrowski SVP General counsel.

Graham Proctor SPP asset management, and declare mahaney VP IR and ER Street.

We're very pleased to deliver another excellent quarter of results, including strong same property NOI growth and substantial <unk> per unit growth driven by the secular recovery in the Canadian mall sector that we seem to be in the early to middle innings of this recovery.

We continue to exercise disciplined capital allocation recycling capital from strategic dispositions.

And retained free cash flow into both strategic acquisitions and unit repurchases.

Since the pandemic created Canadian malls have seen a very strong recovery in tenant sales retailer leasing demand recoveries and NOI.

Primarily the same property tenant sales per square foot are at all time highs in our 33% higher at $723 per square foot than comparable 2019 levels.

NOI has grown sharply, but still legs sales performance to quantify this our occupancy cost ratio remains depressed compared to historical levels currently approximately 12% compared to the historical 2014% to 15% range.

This suggests primarily mark to market on in place rents can drive 15% to 25% NOI growth over the next few years, even if the tenant sales were to remain flat at current levels.

This tailwind has been key to primarily to strong operating and financial results, we expect to capture those mark to market over the next two years supporting strong NOI growth.

To be clear, we havent been sitting back relaxing and enjoying the strong performance we have been incredibly active using this time to reposition the business. So that primarily is well situated to continue to drive above average growth out of its portfolio of exceptional properties over the long term once the current tailwind.

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With the acquisition of Wind Ridge Mall in June primarily acquired $2 billion of Canada's top tier malls since the spin off in addition to the $800 million, we acquired concurrent with the spin.

Those acquisitions now represent approximately 60% of the portfolio by value.

To say these acquisitions have been transformational would be an understatement.

These acquisitions are designed to increase portfolio quality and to structurally increase the base level of internal growth in our portfolio to an above sector average, 3% to 4% same property NOI growth rate on a durable and recurring basis.

The basis for that above average growth in tenant sales rents and NOI can be framed as the moat, we have around our business that form our competitive advantage.

I'll describe fiber.

We showcased our first mode last September at our Halifax, Investor Day, being our management platform, which is specialized for enclosed malls.

This platform provides us with better relationships with retailers because they have confidence in our platform and as a result of more conviction when they commit to our malls.

The strength of our platform acts as a barrier to entry for investors looking to enter the mall market, who lack in enclosed shopping center management platform.

There are only a few specialized small platforms in Canada and this platform allows us to drive better performance and growth out of the malls that we own as compared to what another owner could produce without a similar platform.

We talk a lot about the second vote are differentiated and financial model.

We are highly committed to maintaining very low leverage of below six times debt to EBITDA to maintaining an <unk> payout ratio of approximately 50%.

We think of this as a moat that gives us structurally higher <unk> and <unk> per unit growth as we retain and compound capital faster than if we had higher leverage and a higher payout ratio.

As our public company track record continues to grow we expect this to result in a cost of capital advantage relative to our peers with higher <unk> and have a full multiples.

Our third mode.

Our financing strategy.

Our investment grade credit rating made possible by our sector low financial leverage and low payout ratio allows us to access the unsecured debenture market.

This greatly simplifies our ability to arrange debt financing for our acquisitions as the mortgage financing alternative for these large value properties construction the limits of the secured mortgage market in Canada.

The unsecured structure also allows us to buy and sell properties as well as renovation redeveloped properties without the constraints that come with secured mortgages.

This gives us a significant advantage over potential new entrants to the mall market and over smaller private groups.

Speaker #1: Yes, this is an episode for UnitGrowth. As we retain and compound capital faster, and if we had higher leverage and a higher payout ratio.

Alex Avery: Structurally higher EFFO and FFO per unit growth as we retain and compound capital faster, and if we had higher leverage and a higher payer ratio. As our public company track record continues to grow, we expect this to result in a cost of capital advantage relative to our peers with higher FFO and AFFO multiples. Our third moat is our financing strategy. Our investment-grade credit rating, made possible by our sector-low financial leverage and low payout ratio, allows us to access the unsecured dementia market. This greatly simplifies our ability to arrange debt financing for our acquisitions, as the mortgage financing alternative for these large value properties can stretch the limits of the secured mortgage market in Canada. The unsecured structure also allows us to buy and sell properties, as well as renovate and redevelop properties without the constraints that come with secured mortgages.

Our fourth mode, because the barriers to new supply.

Hurdle discouraging new mall developments are substantial.

I offer us fair value our properties are valued at roughly $330 per square foot.

Speaker #1: As our public company track record continues to grow, we expect this to result in a cost-to-capital advantage relative to our peers with higher SSO and ASSO multiples.

And at our current stock price, our enterprise value reflects the $270 per square foot.

This compares to a replacement cost of approximately $1000 per square foot in most of our markets and considerably more in markets, where land values are higher.

Speaker #1: Our third moat is our financing strategy. Our investment-grade credit rating made possible by our sector low financial leverage and low payout ratio allows us to access the unsecured debenture market.

The weighted average net rent in our portfolio is about $29 per square foot.

Speaker #1: This greatly simplifies our ility to arrange debt financing for our acquisitions as the mortgage financing alternative for these large value properties can stretch the limits of the secured mortgage market in Canada.

To justify new construction rents need to rise between 80 and $100 per square foot for roughly three times our current rents.

Before you contemplate trying to assemble 50, 60 or 70 acres of land in the center of the large population center something that can only be reasonably achieved well outside of the city limits, which is by definition, an inferior location to all of our malls.

Speaker #1: The unsecured structure also allows us to buy and sell properties as well as renovate and redevelop properties without the constraints that come with secured mortgages.

Speaker #1: This gives us a significant advantage over potential new entrants to the mall market and over smaller private groups. Our fourth moat is the barriers to new supply.

Alex Avery: This gives us a significant advantage over potential new entrants to the mall market and over smaller private groups. Our fourth moat is the barriers to new supply. Hurdles discouraging new mall development are substantial. At IFRS fair value, our properties are valued at roughly $330 per square foot. And at our current stock price, our enterprise value reflects about $270 per square foot. This compares to a replacement cost of approximately $1,000 per square foot in most of our markets and considerably more in markets where land values are higher. The weighted average net rent in our portfolio is about $29 per square foot. To justify new construction, rents need to rise to between $80 and $100 per square foot, or roughly three times our current rent.

<unk> is a serious mode.

For serious moats.

But as I mentioned earlier, we have not been resting on our laurels enjoying the right. We've been working hard reshaping the portfolio to achieve structurally higher internal growth.

Speaker #1: The hurdles discouraging new mall development are substantial. At IFRS Fair Value, our properties are valued at roughly $330 per square foot. And at our current stock price, our enterprise value reflects about $270 per square foot.

How are we doing that.

By acquiring some of the best malls in the country and recycling capital from our noncore property portfolio.

Speaker #1: This compares to a replacement cost of approximately $1,000 per square foot in most of our markets and considerably more in markets where land values are higher.

In 2025, we have acquired Associate Center offshore Center and Lionbridge Mall three.

<unk> market, leading malls with sales per square foot and the 800 to <unk> hundred dollars per square foot range and aggregate Tru sales of $250 million to over 300 million per mall.

Speaker #1: The weighted average net rent in our portfolio is about $29 per square foot. To justify new construction, rents need to rise to $80 and $100 per square foot or roughly three times our current rents.

Put this into context.

At the end of 2022 primary <unk> largest small by CRE use sales volume was just under $200 million and today, we have six malls at $200 million or higher.

Speaker #1: That's before you contemplate trying to assemble 50, 60, or 70 acres of land in the center of a large population center something that can only be reasonably achieved well outside of the city limits which is, by definition, an inferior location to all of our malls.

Alex Avery: That's before you contemplate trying to assemble 50, 60, or 70 acres of land in the center of a large population center, something that can only be reasonably achieved well outside of the city limits, which is by definition an inferior location to all of our malls. That is a serious moat. Four serious moats. But as I mentioned earlier, we have not been resting on our laurels, enjoying the ride. We've been working hard reshaping the portfolio to achieve structurally higher internal growth. How are we doing that? By acquiring some of the best malls in the country and recycling capital from our non-core property portfolio. In 2025, we have acquired Southgate Center, Oshawa Center, and Lime Ridge Mall, three market-leading malls with sales per square foot in the $800 to $1,400 per square foot range, and aggregate CRU sales of $250 million to over $300 million per mall.

Even better all of these acquisitions were completed with modest <unk> accretion on an NPV neutral basis, and while keeping leverage below six times debt to EBITDA.

Speaker #1: That is a serious moat. Four serious moats but, as I mentioned earlier, we have not been resting on our laurels enjoying the ride. We've been working hard reshaping the portfolio to achieve structurally higher internal growth.

These malls are important centers for retailers in Canada dominate their markets and elevate primarily stature in the mall industry.

The resulting scale and quality of our mall portfolio makes us a strategically important landlord to retailers across Canada, forming a moat around our business.

Speaker #1: How are we ing that? By acquiring some of the best malls in the country and recycling capital from our non-core property portfolio. In 2025, we have acquired Southgate Center, Oshawa Center, and Limeridge Mall.

Moving on from Moats.

And equally important is our recent acquisition activity.

Our capital recycling.

Speaker #1: Three market-leading malls with sales per square foot in the 800 to 1,400 dollars per square foot range and aggregate CRU sales of 250 million to over 300 million per mall.

In the past 13 months, we have executed the sale of over $300 million of noncore properties, including St. Albert Center Sherwood Park Mall.

Boro marketplace, and North point town center among others.

Speaker #1: To put this into context, at the of 2022, Primaris' largest mall by CRU sales volume was just under 200 million and today we have six malls at 200 million or higher.

Alex Avery: To put this into context, at the end of 2022, Primaris' largest mall by CRU sales volume was just under $200 million. And today, we have six malls at $200 million or higher. Even better, all of these acquisitions were completed with modest FFO accretion on an NAV-neutral basis, and while keeping leverage below six times debt to EBITDA. These malls are important centers for retailers in Canada to dominate their markets and elevate Primaris' stature in the mall industry. The resulting scale and quality of our mall portfolio makes us a strategically important landlord to retailers across Canada, forming a fifth moat around our business. Moving on from moats, and equally important as our recent acquisition activity, is our capital recycling. In the past 13 months, we have executed the sale of over $300 million of non-core properties, including St.

Notably we are preparing for the sale of Northland village, a recently completed redevelopment of Northland them all into one of Canada's best power centers.

Speaker #1: Even better, all of these acquisitions were completed with modest SSO accretion on an NAV neutral basis and while keeping leverage below six times that EBITDA.

<unk> is anchored by Walmart winters best buy good life, it's all around MA and Spinelli, Italian central shop specialty grocery store and restaurant similar to Italy.

Speaker #1: These malls are important centers for retailers in Canada to dominate their markets and elevate Primaris' stature in the mall industry. The resulting scale and quality of our mall portfolio makes us a strategically important landlord to retailers across Canada forming a fifth moat around our business.

All in an affluent trade area and north West Calgary with an average household income of $155000.

Northland village represents almost 40% of the $400 million in our assets held for sale at June 30th by dollar value.

We expect to find a broad pool of interested buyers for this property.

Speaker #1: Moving on from moats, and equally important as our recent acquisition activity, is our capital recycling. In the past 13 months, we have executed the sale of over 300 million of non-core properties including St.

With all of the transactions, we have completed over the past two years, we have substantially repositioned as primary <unk> portfolio to deliver the outcome. Our investors want the most high quality and durable NOI with sustainable same property NOI growth in the 3% to 4% range translating to above <unk>.

Speaker #1: Albert Center, Sherwood Park Mall, Edinburgh Marketplace, and North Point Town Center, among others. Notably, we are preparing for the sale of Northland Village, our recently completed redevelopment of Northland Mall into one of Canada's best power centers.

Alex Avery: Albert Center, Sherwood Park Mall, Edinborough Marketplace, and North Point Town Center, among others. Notably, we are preparing for the sale of Northland Village, our recently completed redevelopment of Northland Mall into one of Canada's best power centers. The center is anchored by Walmart, Winners, Best Buy, Good Life, Dollarama, and Spinelli Italian Center Shop, a specialty grocery store and restaurant similar to Eataly, all in an affluent trade area in Northwest Calgary with an average household income of $155,000. Northland Village represents almost 40% of the $400 million in our assets held for sale at June 30th by dollar value. We expect to find a broad pool of interested buyers for this property.

Average <unk> growth per unit.

We're taking advantage of the current tailwind we are enjoying to invest in the quality of our business, enabling us to achieve sustainable above average long term NOI growth.

Speaker #1: The center is anchored by Walmart, Winners, Best Buy, Good Life, Dollarama, and Spinelli Italian Center Shop, a specialty grocery store and restaurant similar to Eataly all in an affluent trade area in northwest Calgary with an average household income of $155,000.

I'll now turn the call over to Pat to discuss operating and leasing results followed by regs, who will discuss our financial results.

Thank you Alex and good morning.

Our shopping center portfolio continues to perform very well in 2025 with NOI growth coming from strong wheat rental revenue growth and rising operating cost recoveries.

Speaker #1: Northland Village represents almost 40% of the 400 million dollars in our assets held for sale at June 30th by dollar value. We expect to find a broad pool of interested buyers for this property.

The underlying fundamentals for shopping centers continued to be supported by both low retail supply strong tenant sales population growth and continued tenant demand for quality space as well as our national full service platform and team.

Speaker #1: With all of the transactions we have completed over the past few years, we have substantially repositioned Primaris' portfolio to deliver the outcome our investors want the most.

Alex Avery: With all of the transactions we have completed over the past few years, we have substantially repositioned Primaris's portfolio to deliver the outcome our investors want the most: high-quality and durable NOI, with sustainable same-property NOI growth in the 3 to 4 percent range, translating to above-average FFO and AFFO growth per unit. We're taking advantage of the current tailwinds we are enjoying to invest in the quality of our business, enabling us to achieve sustainable, above-average long-term NOI growth. I'll now turn the call over to Pat to discuss operating and leasing results, followed by Raghun, who will discuss our financial results. Pat?

Our same property cash NOI was up five 5% for the quarter compared to Q2, 2024, and seven 5% for the first half of the year.

Speaker #1: High quality and durable NOI with sustainable same property NOI growth in three to four percent range translating to above average SSO and ASSO growth per unit.

Q2 same property shopping center cash NOI growth was five 7% over 2024 and seven 9% for the first six months of the year.

Speaker #1: We're ing advantage of the current tailwinds we are enjoying to invest in the quality our business enabling us to achieve sustainable above average long-term NOI growth.

The primary drivers were higher rent step up rents as well as higher percentage rent and prior year tax refunds.

Recovery ratios for the quarter were 88%, one 2% higher compared to Q2 last year and consistent with the guidance. We provided at the Investor day in September of last year.

Speaker #1: I'll now turn the call over to Pat to discuss operating and leasing results followed by Ragh's who will discuss our financial results. Pat?

Speaker #2: Thank you, Alex, and good ning. Our shopping center portfolio continues to perform very well in 2025 with NOI growth coming from strong rental revenue growth and rising operating cost recoveries.

For context every 1% in Cam and tax we recover equates to approximately $2 million annually.

Pat Sullivan: Thank you, Alex, and good morning. Our shopping center portfolio continues to perform very well in 2025, with NOI growth coming from strong rental revenue growth and rising operating cost recoveries. The underlying fundamentals for shopping centers continue to be supported by both low retail supply, strong tenant sales, population growth, and continued tenant demand for quality space, as well as our national full-service platform and team. Our same-property cash NOI was up 5.5% for the quarter compared to Q2 2024 and 7.5% for the first half of the year. Q2 same-property shopping center cash NOI growth was 5.7% over 2024 and 7.9% for the first six months of the year. The primary drivers were higher rent, step-up rent, as well as higher percentage rent and prior year tax refunds.

This number directly impacts the bottom line.

Portfolio in place occupancy was 88, 8% down four 2% from Q2 last year.

Speaker #2: The underlying fundamentals for shopping centers continued to be supported by both low retail supply strong tenant sales, population growth, and continued tenant demand for quality space as well as our national full-service platform and team.

This is due to the impact of five disclaimed HBC leases an impact of approximately three 6% and the addition of language mall, which has elevated vacancy primarily related to two vacant department store boxes and impact of approximately <unk>, 7%.

Speaker #2: Our same property cash NOI was up 5.5% for the quarter compared to Q2 2024 and 7.5% for the first half of the year. Q2 same property shopping center cash NOI growth was 5.7% over 2024 and 7.9% for the first six months of the year.

The average rent paid by HBC and our portfolio in the five disclaim locations, it's $4 72 per square foot compared to the average large format rents of $15 62 per square foot in our portfolio.

Speaker #2: The primary drivers were higher rent, step-up rent, as well as higher percentage rent and prior year tax refunds. Recovery ratios for the quarter were 80.8%, 1.2% higher compared to Q2 last year, and consistent with the guidance we provided at the investor day in September of last year.

Online Ridge, our acquisition underwriting did not include any rents for either of the Sears and the HBC locations, having said that we are in advanced stages of negotiation to replace the vacancy or as department store and language with a single tenant and expect to provide further updates in the third quarter.

Pat Sullivan: Recovery ratios for the quarter were 80.8%, 1.2% higher compared to Q2 last year, and consistent with the guidance we provided at the Investor Day in September of last year. For context, every 1% in CAM and tax we recover equates to approximately $2 million annually. This number directly impacts the bottom line. Portfolio in-place occupancy was 88.8%, down 4.2% from Q2 last year. This is due to the impact of five disclaimed HBC leases, an impact of approximately 3.6%, and the addition of Lime Ridge Mall, which has elevated vacancy primarily related to two vacant department store boxes, an impact of approximately 0.7%. The average rent paid by HBC in our portfolio in the five disclaimed locations is $4.72 per square foot, compared to the average large format rents of $15.62 per square foot in our portfolio.

Without the impact of HCC in the language acquisition occupancy would have been 93, 3% ahead of Q2 2024.

Speaker #2: For context, every 1% in CAM and tax we recover, equates to approximately $2 million annually. This number directly impacts the bottom line. Portfolio in place occupancy was 88.8%, down 4.2% from Q2 last year.

Increasing occupancy represents a tremendous opportunity for primary.

Since our spin out in 2022, the acquisition of six enclosed mall since we have demonstrated our ability to grow NOI through driving occupancy higher by way of example, since acquiring the <unk> Center in February 2025, we have leased approximately 35000 square feet, which will have a strong positive impact on NOI.

Speaker #2: This is due to the impact of five disclaimed HPC leases and impact of approximately $3.6%, and the addition of Limeridge Mall which has elevated vacancy primarily related to two vacant department store boxes and impact of approximately 0.7%.

At that property in 2026.

Speaker #2: The average rent paid by HPC in our folio on the five disclaimed locations is $4.72 per square foot compared to the average large format rents of $15.62 per square foot in our portfolio.

With respect to HBC locations, we are in very advanced discussions with tenants and we look forward to sharing more information with you once the deals are firm.

We are adjusting our three year in place occupancy target to 94% to 96% as a result of the impact of HCC as well as recent acquisitions with below portfolio average occupancy, we do not anticipate any negative impact in our ability to execute on new lease transactions or increase rents on renewals as a result of <unk>.

Speaker #2: At Limeridge, our acquisition underwriting did not include any rents for either the Sears or the HPC locations. Having said that, we are an advanced stages of negotiation to replace the vacant Sears department store at Limeridge with a single tenant and expect to provide further updates in the third quarter.

Pat Sullivan: At Lime Ridge, our acquisition underwriting did not include any rents for either of the Sears or the HBC locations. Having said that, we are in advanced stages of negotiation to replace the vacant Sears department store at Lime Ridge with a single tenant and expect to provide further updates in the third quarter. Without the impact of HBC and the Lime Ridge acquisition, occupancy would have been 93.3% ahead of Q2 2024. Increasing occupancy represents a tremendous opportunity for Primaris. Since our spin-out in 2022, the acquisition of six enclosed malls since, we have demonstrated our ability to grow NOI through driving occupancy higher. By way of example, since acquiring Oshawa Center in February of 2025, we have leased approximately 35,000 square feet, which will have a strong positive impact on NOI growth at that property in 2026.

Speaker #2: Without the impact of HPC and the Limeridge quisition, occupancy would have been 93.3% ahead of Q2 2024. Increasing occupancy represents a tremendous opportunity for Primaris.

C store closures based on our experience with both target and Sears closures and maintained 96% occupancy as a medium to long term target.

Leasing activity was very strong during the quarter with 122 leases renewed at spreads of six 7%.

Speaker #2: Since our spin out in 2022, the acquisition of six enclosed malls since, we have demonstrated our ability to grow NOI through driving occupancy higher.

In addition, we completed 32, new deals encompassing 87000 square feet during the quarter, including a new 4700 foot square foot Lulu Lemon store at Orchard Park at 15500 square foot unit lower gallery to capital and a 6600 square foot JD sports a duffer mall.

Speaker #2: By way of example, since acquiring Oshawa Center in February 2025, we have leased approximately 35,000 square feet which will have strong positive impact on NOI growth at that property in 2026.

Year to date, we've completed 56, new lease deals for 150000 square feet with 49 of those deals being CRE you tenants equating to 100000 square feet.

Speaker #2: With respect to HPC locations, we are in very advanced discussions with tenants and we look forward to sharing more information with you once the deals are firm.

Pat Sullivan: With respect to HBC locations, we are in very advanced discussions with tenants, and we look forward to sharing more information with you once the deals are firm. We are adjusting our three-year in-place occupancy target to 94 to 96% as a result of the impact of HBC, as well as recent acquisitions with below portfolio average occupancy. We do not anticipate any negative impact in our ability to execute on new lease transactions or increase rents on renewals as a result of HBC store closures based on our experience with both Target and Sears closures, and maintain 96% occupancy as a medium to long-term target. Leasing activity was very strong during the quarter, with 122 leases renewed that spread to 6.7%.

In 2024, we completed 121, new transactions, including 100 that we see are you tenants encompassing 224000 square feet.

Speaker #2: We are adjusting our three-year in place occupancy target to 94 to 96% as a result of the impact of HPC as well as recent acquisitions with below portfolio average occupancy.

New CRE leasing has a significant impact on our NOI given our average CRE rents are $47 37 per square foot and those deals have a positive impact on our recovery ratios.

Speaker #2: We do not anticipate any negative impact in our ability to execute on new lease transactions or increase rents on renewals, as a result of HPC store closures based on our experience with both Target and Sears closures and maintain 96% occupancy as a medium to long-term target.

Our weighted average net rent per square foot for the quarter increased to $28 88 per square foot.

$25 28 at year end.

Speaker #2: Leasing activity was very strong during the quarter with 122 leases renewed that spread to 6.7%. In addition, we completed 32 new deals encompassing 87,000 square feet during the quarter including a new 4,700-foot square foot Lululemon store at Orchard Park at 15,500 square foot Uniglo at Galleria di Capitale and a 6,600 square foot JD Sports at Duffer Mall.

This material increase is the result of our acquisition activity our properties with higher rents.

And the five disclaimed HBC leases with net rent significantly lower than our portfolio average.

Pat Sullivan: In addition, we completed 32 new deals encompassing 87,000 square feet during the quarter, including a new 4,700-foot square foot Lululemon store at Orchard Park, a 15,500 square foot Uniglo at Gallery de Capital, and a 6,600 square foot JD Sports at Dufferin Mall. Year to date, we have completed 56 new lease deals for 150,000 square feet, with 49 of those deals being CRU tenants equating to 100,000 square feet. In 2024, we completed 121 new transactions, including 100 that were CRU tenants encompassing 224,000 square feet. New CRU leasing has a significant impact on our NOI, given our average CRU rents are $47.37 per square foot, and those deals have a positive impact on our recovery ratios. Our weighted average net rent per square foot for the quarter increased to $28.88 per square foot versus $25.28 at year-end.

During the first half of 2025, approximately 200000 square feet of large format tenants opened including a 20000 square foot medical facility at Sunrun.

Over the second half of the year, we have approximately 136000 square feet of large format and exterior tenants opening including a 29000 square foot sport Chek and an 18000 square foot marks which opened last week at Devonshire Mall, plus another 71000 square feet scheduled to open during 2026 combined with our strong CRE and leasing.

Speaker #2: Year to date, we completed 56 new lease deals for 150,000 square feet with 49 of those deals being CRU tenants equating to 100,000 square feet.

Speaker #2: In 2024, we completed 121 new transactions including 100 that CRU tenants encompassing 224,000 square feet. New CRU leasing has a significant impact on our NOI given our age CRU rents are $47.37 per square foot and those deals have a positive impact on our recovery ratios.

These new transactions will contribute to our anticipated growth in NOI over the coming years.

Tenant sales within our properties continue to grow same property same store sales productivity have grown to $723 per square foot at Q2 versus $710 per square foot at Q2 2024.

Speaker #2: Our weighted average net rent per square foot for the quarter increased to $28.88 per square foot versus $25.28 at year end. This material increases the result of our acquisition activity of properties with higher rents and the five disclaimed HPC leases with net rents significantly lower than our portfolio average.

If we add any acquisitions told us total sales productivity clubs to 780 to $84 per square foot.

Pat Sullivan: This material increase is the result of our acquisition activity of properties with higher rents and the five disclaimed HBC leases with net rents significantly lower than our portfolio average. During the first half of 2025, approximately 200,000 square feet of large format tenants opened, including a 20,000 square foot medical facility at Sun Ridge. Over the second half of the year, we have approximately 136,000 square feet of large format and exterior tenants opening, including a 29,000 square foot sports check and an 18,000 square foot Marx, which opened last week at Devonshire Mall, plus another 71,000 square feet scheduled to open during 2026. Combined with our strong CRU leasing, these new transactions will contribute to our anticipated growth in NOI over the coming years. Tenant sales within our properties continue to grow.

Our sales productivity numbers continue to grow as a result of strong tenant performance and capital recycling, including the strategy of acquiring leading shopping centers in growing markets over the long run we anticipate sales growth at our properties will occur due to strong fundamentals in the <unk> shopping center is industry due to a 30 year low and per capita in closed malls.

Speaker #2: During the first half of 2025, approximately 200,000 square feet of large format tenants opened including a 20,000 square foot medical facility at Sunridge. Over the second half of the ar, we have approximately 136,000 square feet large format and exterior tenants opening including a 29,000 square foot sports track and an 18,000 square foot Marx which opened last week at Devonshire Mall.

We're footage and Canada, coupled with population growth.

A few final comments on HBC as we have said many times over primary system. That's prepared for the departure of HBC for over 15 years as its department store peers downsized and cease operations.

Speaker #2: Plus another 71,000 square feet scheduled to open during 2026. Combined with our strong CRU leasing, these new transactions will contribute to our anticipated growth in NOI over the coming years.

Including Zellers target and Sears.

This departure enables future value creation for our stakeholders paving the way for optimal use of space that better reflects the evolving needs and desires of the growing communities.

Speaker #2: Tenant sales within our properties continue to grow. Same properties, same store sales, productivity have grown to 723 dollars per square foot at Q2, versus 710 dollars per square foot at Q2 2024.

Pat Sullivan: Same properties, same store sales, productivity have grown at $723 per square foot at Q2 versus $710 per square foot at Q2 2024. If we add in the acquisitions, total sales productivity climbs to $784 per square foot. Our sales productivity numbers continue to grow as a result of strong tenant performance and capital recycling, including the strategy of acquiring leading shopping centers in growing markets. Over the long run, we anticipate sales growth at our properties will occur due to strong fundamentals in the enclosed shopping center industry, due to a 30-year low in per capita enclosed mall square footage in Canada, coupled with population growth. A few final comments on HBC. As we have said many times over, Primaris has prepared for the departure of HBC for over 15 years, as its department store Sears downsized and ceased operations, including Zellers, Target, and Sears.

At present, five leases have been disclaimed and five leases remained subject to cc AA process.

On July 15th one of the HBC debtor in possession lenders brought a motion asking for the asset purchase agreement between <unk> and central walks owner to be terminated.

Speaker #2: If we add in the acquisitions, total sales productivity climbs to 784 dollars per square foot. Our sales productivity numbers continue to grow as a result of strong tenant performance and capital recycling including the strategy of acquiring leading shopping centers and growing markets.

Although the monitor supported this motion.

And therefore, the disclaimer of the affected leases, including the five remaining primary locations. The court during the motion in order to that that would be brought back in conjunction with emotion for force lease assignments.

Speaker #2: Over the long run, we anticipate sales growth at our properties will occur due to strong fundamentals and the enclosed shopping center industry due to a 30-year low in per capita enclosed mall square footage in Canada coupled with population growth.

In the meantime rent continues to be fully payable by the monitor.

We expect the next hearing to be scheduled before the end of August and maintain our position that the proposal brought forward by central walks owner does not conform with the terms of the HBC leases and should not qualify for a forced assignment.

Speaker #2: A few final comments on HPC. As we have said many times over, Primaris has been has prepared for the departure of HPC for over 15 years.

Speaker #2: As its department store peers downsized and ceased operations, including Zellers, Target, and Sears, this departure enables future value creation for our stakeholders, paving the way for optimal use of space that better reflects the evolving needs and desires of the growing communities.

As a reminder, the five leases not yet disclaimed earn gross rental revenue of approximately zero point $5 million per month.

Pat Sullivan: This departure enables future value creation for our stakeholders, paving the way for optimal use of space that better reflects the evolving needs and desires of the growing communities. At present, five leases have been disclaimed, and five leases remain subject to CCAA process. On July 15th, one of the HBC debtor in possession lenders brought a motion asking for the asset purchase agreement between HBC and Central Walks owner to be terminated. Although the monitor supported this motion, and therefore the disclaimer of the affected leases, including the five remaining Primaris locations, the court adjourned the motion and ordered that it be brought back in conjunction with a motion for forced lease assignments. In the meantime, rent continues to be fully payable by the monitor.

While we patiently wait out the <unk> process, we are aggressively moving ahead with servicing value on the <unk> disclaims leases.

We are already in advanced lease negotiations with groceries sporting goods and other high quality large format retailers.

Speaker #2: At present, five leases have been disclaimed and five leases remain subject to CCAA process. On July 15th, one of the HPC debtor in possession lenders brought a motion asking for the asset purchase agreement between HPC and CentralWax owner to be terminated.

There are a number of opportunities where tenants are considering the entire box others will be subdivided and one or two could be demolished or the mall sold.

Tenants are looking to expand their footprint and are relocating to the mall, we are having conversations with municipalities unlocked potential redevelopment plans and are in discussions with residential developers all of these conversations have now been accelerated and we are finally in a position to source the highest and best use out of these sites with tight control restrictions.

Speaker #2: Although the monitors supported this motion, and therefore the disclaimer of the affected leases, including the five remaining Primaris locations, the court adjourned the motion in order that it be brought back in conjunction with a motion for forced lease assignments.

Speaker #2: In the meantime, rent continues to be fully payable by the monitor. We expect the next hearing to be scheduled before the end of August and maintain our position that the proposal brought forward by CentralWax owner does not HPC leases and should not qualify for a forced assignment.

Emanated.

Based on our analysis to date and as a general statement, we estimate it will cost approximately $25 million to $30 million to re demise, and HBC box and approximately $8 million to $9 million to demolish including all site works were single tenant takes in HCC box the cost of <unk> can be as little as 12 months free rent.

Pat Sullivan: We expect the next hearing to be scheduled before the end of August and maintain our position that the proposal brought forward by Central Walks owner does not conform with the terms of the HBC leases and should not qualify for a forced assignment. As a reminder, the five leases not yet disclaimed earned gross rental revenue of approximately $0.5 million per month. While we patiently wait out the CCAA process, we are aggressively moving ahead with surfacing value on the five disclaimed leases. We are already in advanced lease negotiations with grocers, sporting goods, and other high-quality large format retailers. There are a number of opportunities where tenants are considering the entire box; others will be subdivided, and one or two could be demolished or the mall sold. Tenants are looking to expand their footprint and/or relocate into the mall.

Speaker #2: As a reminder, the five leases not yet disclaimed earned gross rental revenue of approximately 0.5 million dollars per month. While we patiently it out the CCAA process, we are aggressively moving ahead with servicing value on the five disclaimed leases.

We are currently estimating a total HBC related spend of $125 million to $150 million over the next few years.

Furthermore, we expect yields on the invested capital between 7% and 12% or more or a lower 3% to 6% when including only the incremental NOI beyond the foregone HBC brand the.

Speaker #2: We are already in advanced lease negotiations with grocers, sporting goods, and other high-quality large format retailers. There are a of opportunities where tenants are considering the Attire Box, others will be subdivided, and one or two could be demolished or the mall is sold.

The analysis of the impact of Hbc's departure gets a little more nuanced when you consider the value of the land that becomes available the elimination of restrictions embedded in the HBC leases.

Speaker #2: Tenants are looking to expand their footprint and/or relocate into the mall. We are having conversations with municipalities on potential redevelopment plans and are in discussions with residential developers.

Pat Sullivan: We are having conversations with municipalities on potential redevelopment plans and are in discussions with residential developers. All of these conversations have now been accelerated, and we are finally in a position to source the highest and best use out of these sites, with site control restrictions eliminated. Based on our analysis to date and as a general statement, we estimate it will cost approximately $25 to $30 million to re-demise an HBC box and approximately $8 to $9 million to demolish, including all site works. Where a single tenant takes an HBC box, the cost to Primaris could be as little as 12 months free rent. We are currently estimating a total HBC-related spend of $125 to $150 million over the next few years.

We expect the value could fund the cost of the HBC related spend however, servicing such value will take time and because primaries have ample capital we don't need to monetize this value to fund <unk> related spend.

Speaker #2: All of these conversations have now been accelerated and we are finally in a to source the highest and best use out of these sites.

Speaker #2: With site control, restrictions eliminated. Based on our analysis to date and as a general statement, we estimate it will cost approximately 25 to 30 million dollars to redevise an HPC box and approximately 8 to 9 million dollars to demolish including all site works.

Rather we can maximize that value by pursuing monetization at the optimal time for each property.

These financial estimates also don't factor in the qualitative benefits to our shopping centers the halo effect on sales and rents from tenants adjacent to the former HBC locations that will be reinvigorated with new retailers, nor the impact on cap rates and valuations for a property that replaces question will tenancies with new stronger retailers.

Speaker #2: We're a single tenant takes an HPC box to cost Primaris could be as little as 12 months free rent. We are currently estimating a total HPC related spend of 125 to 150 million dollars over the next few years.

Assuming all leases are eventually disclaimed, we anticipate that over time the site will be fully optimized with the removal of site restrictions, enabling redevelopment improved traffic flow better sidelines financially stronger and more relevant tenants contributed to an enhanced merchandise mix and the opportunity to severance sell excess land for its highest and best use.

Speaker #2: Furthermore, we expect yields on the invested capital between 7% and 12% or more or lower 3% to 6% when including only the incremental NOI beyond the foregone HPC rent.

Pat Sullivan: Furthermore, we expect yields on the invested capital between 7% and 12% or more, or a lower 3% to 6% when including only the incremental NOI beyond the foregone HBC rent. The analysis of the impact of HBC's departure gets a little more nuanced when you consider the value of the land that becomes available with the elimination of restrictions embedded in the HBC leases. We expect the value could fund the cost of the HBC-related spend. However, surfacing such value will take time, and because Primaris has ample capital, we don't need to monetize this value to fund HBC-related spend. Rather, we can maximize that value by pursuing monetization at the optimal time for each property.

Speaker #2: The analysis of the impact of HPC's departure gets a little more nuanced when you consider the value of the land that becomes available with the elimination of restrictions embedded in the HPC leases.

To conclude it's a very exciting time to be in the mall business, primarily continues to perform very well and we are very well positioned to capture continued growth within our malls and with that I'll turn the call over to <unk> to discuss our financial metrics regs.

Speaker #2: We expect the value could fund the cost of the HPC related spend. However, servicing such value will take time and because Primaris has ample capital, we don't need to monetize this value to fund HPC related spend.

Thank you Pat.

Good morning, everyone.

Speaker #2: Rather, we can maximize that value by pursuing monetization at the optimal time for each property. These financial estimates also don't factor in the qualificative benefits to our shopping centers the halo effect on sales and rents from tenants adjacent to the former HPC locations that will be reinvigorated with new retailers nor the impact on cap rates and valuations for a property that replaces questionable tenancies with new stronger retailers.

Our operating and financial results for the quarter continuing to remain very strong.

We're seeing very strong NOI growth from our portfolio specifically the acquisition properties.

Pat Sullivan: These financial estimates also don't factor in the qualitative benefits to our shopping centers, the halo effect on sales and rents from tenants adjacent to the former HBC locations that will be reinvigorated with new retailers, nor the impact on cap rates and valuations for a property that replaces questionable tenancies with new, stronger retailers. Assuming all leases are eventually disclaimed, we anticipate that over time, the sites will be fully optimized with the removal of site restrictions, enabling redevelopment, improved traffic flow, better site lines, financially stronger and more relevant tenants, contributed to an enhanced merchandise mix, and the opportunity to sever and sell excess land for its highest and best use. To conclude, it's a very exciting time to be in the mall business. Primaris continues to perform very well, and we are very well positioned to capture continued growth within our malls.

There are many operating metrics continuing to improve.

Business is reaching critical mass as can be seen in our G&A.

<unk> of rental revenue, which is now more aligned with our retail peers above 5% for the quarter and 3% year to date.

Speaker #2: Assuming all leases are eventually disclaimed, we anticipate that over time the sites be fully optimized with the removal of site restrictions enabling redevelopment, improved traffic flow, better sight lines, financially stronger and more relevant tenants, contributed to an enhanced merchandise mix, and the opportunity to sever and sell excess land for its highest and best use.

These results are flowing through the cash flow metrics with <unk> per unit diluted.

Five 5% for the quarter and <unk> premium it dilutive.

So 24, 6%.

Speaker #2: To conclude, it's a very exciting time to be in the mall business. Primaris continues to perform very well and we are very well positioned to capture continued growth within our malls.

We achieved these impressive putting.

Unit results, despite higher interest costs and increasing new account.

Internal growth and accretive high quality acquisitions completed over the last 12 months.

Speaker #2: And with that, I'll turn the call over to Ragh's to discuss our financial metrics. Ragh's?

Pat Sullivan: And with that, I'll turn the call over to Raghs to discuss our financial metrics. Raghs.

However, about our performance.

Speaker #3: Thank you, Pat. And good morning, everyone. Our operating and financial results for the quarter continue to remain very strong. We're seeing very strong NOI growth from our portfolio, specifically the acquisition properties and our operating metrics are continuing to improve.

During the quarter, we closed on the sale of land found in industrial and Peterborough, Ontario for $10 million.

Raghunath Davloor: Thank you, Pat, and good morning, everyone. Our operating and financial results for the quarter continue to remain very strong. We're seeing very strong NOI growth from our portfolio, specifically the acquisition properties, and now many operating metrics are continuing to improve. Our business is reaching critical mass, as can be seen in our GNA as a percentage of rental revenue, which is now more in line with our retail peers of 4.5% for the quarter and 4.3% year to date. These results are flowing through to our cash flow metrics, with FFO per unit diluted at 5.5% for the quarter and AFFO per unit diluted at the very strong 24.6%. We achieved these impressive per unit results despite higher interest costs and increased unit count. Internal growth and the creative high-quality acquisitions completed over the last 12 months are drivers about our performance.

After quarter end, we also completed the disposition of <unk>.

Please turn plazas and medicine at Alberta for proceeds of $12 7 million and the disposition of non <unk> Town Center and open their plaza in Calgary, Alberta for $54 5 million.

Speaker #3: Our business is reaching critical mass as can be seen in our GNA as a percentage of rental revenue which is now more in line with our retail peers of 4.5% for the quarter and 4.3% year to date.

This brings our total dispositions year to date to $246 1 million.

This positions in addition to our assets held for sale pool aligned to our strategy.

Speaker #3: These results are flowing through to our cash flow metrics with SSO per unit diluted at 5.5% for the quarter and ASSO per unit diluted at the very strong 24.6%.

Growing high quality portfolio of leading and closed shopping centers in Canada.

Our average net debt to adjusted EBITDA was five eight times and within a range of four to six times as a reminder, first range for as part of our executive compensation structure with the top end of the range of six times.

Speaker #3: We achieve these impressive per unit results despite higher interest costs and increased unit count. Internal growth and accretive high-quality acquisitions completed over the last 12 months are drivers of our performance.

At the end of June primarily Congress <unk> Green Finance framework, and subsequently issued 200 million senior unsecured debentures at fault.

Speaker #3: During the quarter, we closed on the sale Lansdowne Industrial and Peterborough, Ontario, for $10 million. Subsequent to quarter end, we also completed the disposition of three strip plazas in Medicinehead, Alberta, for proceeds of $12.7 million and the disposition of North Point Town Center, an open-air plaza in Calgary, Alberta, for $54.5 million.

Raghunath Davloor: During the quarter, we closed on the sale of Lansdowne Industrial in Peterborough, Ontario, for $10 million. Subsequent to quarter end, we also completed the disposition of three strip plazas in Madison Head, Alberta, for costing just 12.7 million, and the disposition of North Point Town Center and Open Air Plaza in Calgary, Alberta, for 54.5 million. This brings our total dispositions year to date to $246.1 million. These dispositions, in addition to our assets held for sale pool, align to our strategy to own a growing high-quality portfolio of leading enclosed shopping centers in Canada. Our average net debt to adjusted EBITDA was 5.8 times and within our range of 46 times. And as a reminder, this range forms part of our executive compensation structure, with the top end of the range of six times.

So 85%.

The net proceeds from the issuance of a fund eligible green projects.

Clyde Green Finance framework.

So definitely there was further extended.

The debenture is for nature of term maturing in June play surgery suite.

Our weighted average term to maturity is now $4 four years pushes failures at year end and our weighted average interest rate is now $5 or 7% as.

Speaker #3: This brings our total dispositions year to date to $246.1 million. These dispositions in addition to our assets held for sale pool align to our strategy to own a growing high-quality portfolio of leading enclosed shopping centers in Canada.

Compared to $5 two 8% over the same period.

With unencumbered assets of $4 $4.084 billion in liquidity and no debt maturing until 2027.

Speaker #3: Our average net debt to adjusted EBITDA was 5.8 times and within our range of $46. As a reminder, this range forms part of our executive compensation structure with the top end of the range of six times.

Eliminated refinancing risk in the medium term.

Our significant liquidity.

<unk> has been in the market repurchasing units since March nine 2022, and nobody is sadly as.

Speaker #3: Near the end of June, Primaris published its inaugural green finance framework and subsequently issued $200 million in senior and secured green debentures at 4.835%.

Raghunath Davloor: Near the end of June, Primaris published its inaugural green finance framework and subsequently issued $200 million in senior unsecured green debentures at 4.835%. The net proceeds from the issuance will fund eligible green projects as described in our green finance framework. The debt ladder was further extended as the debenture is for a nature of term maturing in June 2033. Our weighted average term of maturity is now 4.4 years versus four years at year-end, and our weighted average interest rate is now 5.17% as compared to 5.28% over the same period. With unencumbered assets of $4.4 billion, $584 million in liquidity, and no debt maturing until 2027, we have eliminated refinancing risk in the median term and have accessed to significant liquidity. Primaris has been in the market repurchasing units since March 9, 2022, under the NCIB.

At quarter end were purchased for cancellation for $2 2 million units at an average per unit value of approximately $14 five.

Speaker #3: The net proceeds from the issuance will fund eligible green projects as described in our green finance framework. The debt ladder was further extended as a debenture is for a nature term maturing in June 2033.

Or an approximate 33, 5% discount to our NAV of $21 43.

Great culture says under the program in 2025 funded in part by proceeds from dispositions of all of the exceeded all repurchases completed in 2020 for this program is very accretive to the holders.

Speaker #3: Our weighted average term to maturity is now 4.4 years, compared to 4.0 years at year-end, and our weighted average interest rate is now 5.17%, down from 5.28% over the same period.

Given our strong results to date and confidence in the strength of our business. We are increasing our 2025 guidance for cash NOI to 340 to 300.

Speaker #3: With unencumbered assets of 4.4 billion, $584 million in liquidity, and no debt maturing until 2027, we have eliminated refinancing risk in the median term and have access to significant liquidity.

45 million <unk> per unit to $1 74 to $1 79.

With these adjustments account for accretive acquisitions completed during the year, an additional $1 5 million.

Speaker #3: Primaris has been in the market re-purchasing units since March 9, 2022, under the NCIB. As our quarter ends, there are purchase for cancellation 14.2 million units at an average per unit value of approximately 14.25 or an approximate 33.5% discount to our NAV of 21.43.

The expected agency gross rental income to the end of September.

Raghunath Davloor: As our quarter ends, there are purchase for cancellation for 2.2 million units at an average per unit value of approximately $14.25, on an approximate 33.5% discount to our NAV of $21.43. Repurchases under the program in 2025, funded in part by proceeds from dispositions, have already exceeded all repurchases completed in 2024. This program is very accretive to unit holders. Given our strong results to date and confidence in the strength of our business, we are increasing our 2025 guidance for cash NOI to $340 to $345 million and FFO per unit to $1.74 to $1.79. These adjustments account for accreted acquisitions completed during the year, an additional $1.5 million of expected HBC gross rental income to the end of September, and disclosure for the remainder of the HBC leases.

And disclaimer for the remainder of the intrusiveness.

We do not anticipate any significant capex spend.

<unk> boxes in 2025 due to the timing of the <unk> process.

Speaker #3: Repurchases under the program in 2025 funded in part by proceeds from dispositions have already exceeded all repurchases completed in 2024. This program is very accretive to you, the holders.

We anticipate same company's cash NOI growth to remain in the range of 3% 4%.

Our guidance includes the impact of this $1 5 million.

<unk> gross rent anticipated to the end of September the acquisition of also a center.

Speaker #3: Given our strong results to date and confidence in the strength of our business, we are increasing our 2025 guidance for cash NOI to $340,000 to $345,000,000 and SSO per unit to $1.74 to $1.79.

<unk> underlying whether it's small and.

And almost 300 million of dispositions throughout the year of which approximately $245 million is now being completed.

No additional acquisitions are incorporated into the guidance for the details of our 2025 guidance can be found in section four of the MD&A titled current business environment and outlook.

Speaker #3: These adjustments account for accretive acquisitions completed during the year and additional $1.5 million of expected HPC gross rental income to the end of September and disclaimed for remainder of the HPC leases.

Overall, we're very pleased with our results for the second quarter and are optimistic.

Speaker #3: We do not anticipate any significant cap expense with respect to the HPC boxes in 2025 due to the timing of the CCAA process. We anticipate same properties cash NOI growth to remain in the range of 3% to 4%.

In 2025 and beyond.

Raghunath Davloor: We do not anticipate any significant capex spend with respect to the HBC boxes in 2025 due to the timing of the CCAA process. We anticipate same properties' cash NOI growth to remain in the range of 3 to 4%. Our guidance includes the impact of the additional $1.5 million of HBC gross rent anticipated to the end of September, the acquisition of Oshawa Center, Southgate Center, and Lime Ridge Mall, and over $300 million of dispossessions throughout the year, of which approximately $245 million has now been completed. No additional acquisitions are incorporated into the guidance. Further details of our 2025 guidance can be found in section four of the MDNA titled Current Business Environment and Outlook. Overall, we are very pleased with our results for the second quarter and are optimistic of the outlook in 2025 and beyond.

Maintaining a conservative financial model and generating free cash flow after distributions and operating capital and the core focus from which we will not deviate from.

And with that I'll turn the call back pilots.

Thank you regs.

Speaker #3: Our guidance includes the impact of the additional $1.5 million of HPC gross rent anticipated to the end of September. The acquisition of Oshawa Center, Southgate Center, and Limeridge Mall and over $300 million of dispositions throughout the year.

As you have heard the first half of 2025, we're seeing strong operating and financial results that we expect continued strength in the second half as well.

Looking at primarily as a stock there were a few notable developments worth highlighting.

These observations are byproducts of our strategy and don't drive our decision, making but are of interest to our investors.

Speaker #3: Of which approximately $245 million has now been completed. No additional acquisitions are incorporated into the guidance. Further details of our 2025 guidance can be found in section four of the MDNA, titled Current Business Environment and Outlook.

In September S&P will complete its quarterly index, rebalancing, which will capture the almost 9% increase in primary units outstanding due to the stock issued as consideration for our Lionbridge acquisition.

Speaker #3: Overall, we're very pleased with our results for the second quarter and are optimistic of the outlook in 2025 and beyond. Maintaining a conservative financial model and generating free cash flow after distributions and operating capital is a core focus from which we will not deviate from.

This rebalancing should elevate primarily to the 13th position and the S&P PSX capped REIT index from its current 14th position and up from the 19th position when primarily with first added in early 2022.

Raghunath Davloor: Maintaining a conservative financial model and generating free cash flow after distributions and operating capital is the core focus from which we will not deviate from. And with that, I'll turn the call back to Alex.

Combined with one or two potential index deletions over the next two or three quarters, primarily is getting close to cracking the top 10 names in the index.

Speaker #3: And with that, I'll turn the call back to Alex.

Another byproduct of our recent acquisitions last October and this June where the vendors chose to sell the units issued as consideration is.

Speaker #2: Thank you, Ragh's. As you have heard, the first half of 2025 has seen strong operating and financial results and we expect continued strength in the second half as well.

Alex Avery: Thank you, Raghs. As you have heard, the first half of 2025 has seen strong operating and financial results, and we expect continued strength in the second half as well. Looking at Primaris as a stock, there are a few notable developments worth highlighting. These observations are byproducts of our strategy and don't drive our decision-making, but are of interest to our investors. In September, S&P will complete its quarterly index rebalancing, which will capture the almost 9% increase in Primaris units outstanding due to the stock issued as consideration for our Lime Ridge acquisition. This rebalancing should elevate Primaris to the 13th position in the S&P TSX CapTree Index from its current 14th position and up from the 19th position when Primaris was first added in early 2022.

Is the increased float and increased trading volume of our units.

Speaker #2: Looking at Primaris as a stock, there are a few notable developments worth highlighting. These observations are byproducts of our strategy and don't drive our decision-making but are of interest to our investors.

The 90 day average trading volume of primary units has increased by over 130% over the past 12 months to $7 million a day from $3 million a day a year ago.

This substantial improvement in trading liquidity opens up a very large pool of institutional investors that manage large funds.

Speaker #2: In September, S&P will complete its quarterly index rebalancing which will capture the almost 9% increase in Primaris units outstanding due to the stock issued as consideration for our Limeridge acquisition.

Minimum trading liquidity thresholds.

Over the past few years, we have held recurring meetings with many of these investors who have shared their enthusiasm to invest in primaries, but frustration with trading liquidity constraints.

Speaker #2: This rebalancing should elevate Primaris to the 13th position in the S&P TSX capped read index from its current 14th position and up from the 19th position when Primaris was first added in early 2022.

We believe our most recent acquisition and the subsequent secondary offering of units is only partially been reflected in our trading liquidity on that our trading liquidity will continue to rise as our index weighting was increased.

Speaker #2: Combined with one or two potential index deletions over the next two or three quarters, Primaris is getting close to cracking the top 10 names in the index.

Alex Avery: Combined with one or two potential index deletions over the next two or three quarters, Primaris is getting close to cracking the top 10 names in the index. Another byproduct of our recent acquisitions last October and this June, where the vendors chose to sell the units issued as consideration, is the increased float and increased trading volume of our units. The 90-day average trading volume of Primaris units has increased by over 130% over the past 12 months to $7 million a day from $3 million a day a year ago. This substantial improvement in trading liquidity opens up a very large pool of institutional investors that manage large funds and have minimum trading liquidity thresholds. Over the past few years, we have held recurring meetings with many of these investors who have shared their enthusiasm to invest in Primaris at frustration with trading liquidity constraints.

Also on the topic of indices.

Speaker #2: Another byproduct of our cent acquisitions last October and this June were the vendors chose to sell the units issued as consideration is the increased float and increased trading volume of our units.

Effective with the anticipated distribution increase we typically announced with our Q3 results in November primarily is expected to be added to the dividend aristocrats index further enhancing trading liquidity.

Speaker #2: The 90-day average trading volume of Primaris units has increased by over 130% over the past 12 months to $7 million a day from $3 million a day a year ago.

Moving on we are very much looking forward to hosting analysts and investors at our property tour at the end of September.

We will be showcasing the gallery the capital in Quebec City acquired last October.

Speaker #2: This substantial improvement in trading liquidity opens up a very large pool of institutional investors that manage large funds and have minimum trading liquidity thresholds.

As well as showcasing our mall management team and we will be bringing in local industry experts to provide market context.

Hope to see you there.

Speaker #2: Over the past few years, we have held recurring meetings with many of these investors who have shared their enthusiasm to invest in Primaris but frustration with trading liquidity constraints.

In conclusion, we are very pleased with how our business is performing the.

The future looks very bright and we are committed to executing on the opportunity ahead of us.

We'd now be pleased to answer any questions from our call participants operator, please open the line for questions.

Speaker #2: We believe our most recent acquisition and the subsequent secondary offering of units has only partially been reflected in our trading liquidity and that our trading liquidity will continue to rise as our index weighting is increased.

Alex Avery: We believe our most recent acquisition and the subsequent secondary offering of units has only partially been reflected in our trading liquidity and that our trading liquidity will continue to rise as our index weighting is increased. Also, on the topic of indices, effective with the anticipated distribution increase we typically announce with our Q3 results in November, Primaris is expected to be added to the Dividend Aristocrats Index, further enhancing trading liquidity. Moving on, we are very much looking forward to hosting analysts and investors at our property tour at the end of September. We will be showcasing Les Galeries de la Capitale in Quebec City, acquired last October, as well as showcasing our mall management team, and we'll be bringing in local industry experts to provide market context. We hope to see you there. In conclusion, we are very pleased with how our business is performing.

Thank you.

If you would like to ask quick question. During this time simply press star followed by the number one on your telephone keypad.

Speaker #2: Also, on the topic of indices, effective with the anticipated distribution increase, we typically announce with our Q3 results in November. Primaris is expected to be added to the dividend.

To withdraw your question. Please press star followed by the number you May ask one question and a follow up at which point you may return to the queue.

Pause for just a moment to compile the Q&A roster.

Speaker #2: To Kratz Index. Further enhancing trading liquidity. Moving on, we are very much looking forward to hosting analysts and investors at our property tour at the end of September.

The first question comes from Samsung.

TD Cowen your line is now okay.

Thank you and good morning, everyone first question Alex could you just tell me the guac ratio print.

Speaker #2: We will be showcasing Les Galeries de la Capitale in Quebec City, acquired last October, as well as showcasing our mall management team and we'll be bringing in local industry experts to provide market context.

Printing around 11% currently and targeting back up to about 14% to 15% historically is that a goal that is shared by many of your industry. The industry. Our competitors or is this I'm just wondering like is there.

Speaker #2: We hope to see you there. In conclusion, we are very pleased with how our business is performing; the future looks very bright and we are committed to executing on the opportunity ahead of us.

Is that a realistic target for the industry or do you see that is a realistic target for primarily for some unique reason.

Alex Avery: The future looks very bright, and we are committed to executing on the opportunity ahead of us. We'd now be pleased to answer any questions from the call participants. Operator, please open the line for questions.

Yeah.

Speaker #2: We'd now be pleased to answer any questions from the call participants. Operator, please open the line for questions.

Hi, Sam it's Pat I'll take that yes, I think.

Tenant affordability has always been important to us but.

Speaker #4: Thank you. If you would like to ask a question during this time, simply press star, followed by the number one on your telephone keypad.

There is certainly a case to be made.

Operator: Thank you. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press star followed by the number two. You may ask one question and a follow-up, at which point you may return to the queue. We will pause for just a moment to compile the Q&A roster. The first question comes from Sam Damiani with TD Cohen. Your line is now open.

Well within the means to have a gross level around 14%, 15%. It has been it has been low for the past couple of years, partially coming out of the pandemic.

Speaker #4: If you would like withdraw your question, please press star, followed by the number two. You may ask one question and a follow-up at which point you may return to the queue.

Partially because sales have really lifted off quite substantially in the last few years and rents just haven't caught up yet.

Speaker #4: We will pause for just a moment to compile the Q&A roster. The first question comes from Sam Damiani with TD Cohen, your line is now open.

It's a target that we have and I know a lot of our other.

Tears, that's only shopping centers.

And I'm thinking the same way.

Speaker #2: Thank you. Good morning, everyone. The first question, Alex, is just on the grok ratio trending around 11% currently and targeting back up to that 14 to 15%.

Okay. That's great. That's helpful. And then just as my follow on is just buying back to HBC.

Alex Avery: Thank you. Good morning, everyone. My first question, Alex, is just on the the GROC ratio trending around 11% currently and targeting back up to that 14 to 15% historically. Is that a goal that is shared by many of your industry competitors, or is this like I'm just wondering, like, you know, is that a realistic target for the industry, or do you see that as a realistic target for Primaris for some unique reason?

You gave a lot of good information in your opening remarks, but just wondering if you could be a little bit more specific on perhaps some of the types of tenants you're talking to when.

Speaker #2: Historically, is that a goal that is shared by many of your industry competitors or is this like I'm wondering like, you know, is that a realistic target for the industry or do you e that as a realistic target for Primaris for some unique reason?

When the earliest cash rents commence.

Are your discussions that are going on.

Sure I think we're talking to a variety of tenants most of them are international.

Speaker #5: Hi, Sam, it's Pat. I'll take that. Yeah, think tenant affordability has always been important to us, but there's certainly a case to be made that that's well within the means to have a grok level around 14, 15%.

Box stores, there is a couple of malls, where we're looking at adding <unk> and <unk>.

Pat Sullivan: Hi, Sam. It's Pat. I'll take that. Yeah, I think tenant affordability has always been important to us, but there's certainly a case to be made that that's well within the means to have a GROC level around 14, 15%. It has been low for the past couple of years, partially coming out of the pandemic, partially because sales have really lifted off quite substantially in the last few years, and rents just haven't caught up yet. But it's a target we have, and I know a lot of our other peers that own shopping centers are aligned and thinking the same way.

Got some very good pre leasing activity going on all of these boxes.

I think just because of the nature of the boxes the getting the permits the doing the demolition during the build out, especially if they're subdividing youre really looking at about probably 18 to 24 months before rent commences and if it's a single box, taking the whole space, which we do have a couple of those that we're dealing with right now youre looking at.

Speaker #5: It has been low for the past couple of years, partially coming out of the pandemic. Partially because sales have really lifted off quite substantially in the last few years, and rents just haven't caught up yet.

Speaker #5: But it's a target we have and I know a lot of our other peers that own shopping centers are aligned in thinking the same way.

Less than 18 months.

Thank you so much for your question.

Speaker #2: Okay, that's great. That's helpful. And just my follow-on is just back to HPC, you ow, Pat, you gave a lot of good ation in your opening remarks.

Alex Avery: Okay, that's great. That's helpful. And just my follow-on is just back to HBC. You know, you gave a lot of good information in your opening remarks. Just wondering if you could be a little bit more specific on perhaps, you know, some of the types of tenants you're talking to, when the earliest cash rents could commence, and are your discussions that are going on?

Question comes from the line camera with Desjardins. Your line is now okay.

Thanks, Good morning.

Speaker #2: Just wondering if you could be a little bit more specific on perhaps, you know, some of the types of tenants you're talking to, when the earliest cash rent could commence, and are your discussions that are ing .

Just on the <unk> guidance I was wondering if you could give us an idea of what sort of has to happen operationally to achieve the low end versus the high it.

Oh, Okay, well the low end is really to.

Speaker #5: Sure. I ink we're talking to a variety of tenants. Most of them are national box stores. There's a couple malls where we're looking at adding CRU and we've got some very good pre-leasing activity going on all these boxes.

Pat Sullivan: Sure. I think we're talking to a variety of tenants. Most of them are national box stores. There's a couple of malls where we're looking at adding CRU, and we've got some very good pre-leasing activity going on all these boxes. I think just because of the nature of the boxes, getting the permits, doing the demolition, doing the build-out, especially if they're subdividing, you're really looking at about probably 18 to 24 months before rent commences. And if it's a single box taking the whole space, which we do have a couple of those that we're dealing with right now, you're looking at, say, you know, less than 18 months.

Sales drop off a bit and per center as it comes off.

Laura we have bad debt.

The high end.

It's really the opposite thing Jack possesses.

Speaker #5: I ink just because of the nature the boxes, the getting the permits, doing the demolition, doing the build-out, especially if they're subdividing, you're really looking at about probably 18 to 24 months before rent commences.

The sales productivity.

Activity keeps going and some of the acquisitions are outperforming so.

That can contribute to the to the high end also if there's any further delays on some of the dispositions are sort of spread it out.

Speaker #5: And if it's a single box, taking the whole space, which we do have a couple of those that we're doing with right now, you're looking at, say, less than 18 months.

September to December December doesn't really move the dial.

September dispositions get delayed for some other reason then that could move us more to the high end.

Speaker #4: Thank you so much for your questions. The next question comes from Lauren Kelmara with The Jardins. Your line is now open.

Operator: Thank you so much for your questions. The next question comes from Lauren Kilmar with the Jardins. Your line is now open.

Okay perfect.

And then just on the Northland village.

Speaker #6: Thanks. Good morning. Just on the up SSO guidance, I was wondering if you uld give us an idea of what sort of has to happen operationally to achieve the low end versus the high end.

Mark Rothschild: Thanks. Good morning. Just on the FFO guidance, I was wondering if you could give us an idea of what sort of has to happen operationally to achieve the low end versus the high end.

It sounds like based on the disposition guidance for the year, you're not expecting to sell that this year could you maybe give us a bit of an idea on timing and maybe expected deal.

Hi, Lauren.

Yes, I think we're we're targeting to close by the close the transaction by the end of the year.

Speaker #3: Well, okay. Well, the low end is really if sales drop off a bit and start to send rent comes off. Or if we have bad debt, it spends the high end.

Raghunath Davloor: Oh, okay. Well, the low end is really if sales drop off a bit and a short percent rent comes off, or if we have bad debt. It spans the high end is really the opposite, the exact opposite, if the sales productivity keeps going and some of the acquisitions are outperforming, so that that can contribute to the high end. Also, if there's any further delays on some of the dispositions, we've sort of spread it out September to December. December doesn't really move the dial. But if September dispositions get delayed for some other reason, then that could move us more to the high end.

It's a property that we expect to have a lot of interest in given the nature of their property is it's been basically it's basically a lot of new construction thats anchored by Walmart and another grocery store with a lot of national tenants. So we expect quite a bit of interest in the property and we're going to work towards.

Speaker #3: It's really the opposite. The exact opposite. If the sales productivity keeps going, and some of the acquisitions are outperforming, so that that can contribute to the to the high end.

Completion by the end of the year.

Yeah.

Speaker #3: Also, if there's any further delays on some of the dispositions, we've sort of spread it out September to December. December doesn't really move the dial.

Thank you so much for your question. The next question comes from Mark Rothschild with Canaccord Genuity. Your line is now open.

Thanks, and good morning.

Speaker #3: We're there September dispositions get delayed for some other reason. Then that could move us more to the high end.

Alex you went over a number of variables that have driven that.

Stronger fundamentals.

Just curious if you see.

Speaker #6: Okay, perfect. And then just on the Northland Village, it sounds like based on the disposition guidance for the year, you're not expecting to sell that this year.

And any risk to the downside, whether it's from slowing population growth or the impact of tariffs and how retailers react could we potentially see.

Mark Rothschild: Okay, perfect. And then just on the Northland Village, it sounds like based on the disposition guidance for the year, you're not expecting to sell that this year. Could you maybe give us a bit of an idea on timing and maybe expected deal?

Speaker #6: Could you maybe give us a bit of an idea on timing and maybe expected yield?

Some softness that you don't necessarily expect over the next year or is there just enough demand coming in right now that you.

Speaker #5: Hi, Lauren. Yeah, I think we're we're targeting to close by close the transaction by the end of the year. It's a property that we expect to have a lot of interest in given the nature of the property.

Pat Sullivan: Hi, Lauren. Yeah, I think we're targeting to close a transaction by the end of the year. It's a property that we expect to have a lot of interest in, given the nature of the property. It's basically a lot of new construction. It's anchored by Walmart and another grocery store with a lot of national tenants. So we expect quite a bit of interest in the property, and we're going to work towards completion by the end of the year.

You should be able to withstand that and continue to drive that.

The same comparable organic growth.

Yeah. Thanks Mark.

Speaker #5: It's it's been it's basically a lot of new construction. It's anchored by Walmart and another grocery store. With a lot national tenants. So we expect quite a bit of interest in property and we're going to work towards completion by the end of the year.

I mean, there's a lot in that question, but I would say that.

Whats really driving our business are generally speaking longer term decisions from retailers and.

Well, we haven't seen any change in.

Speaker #4: Thank you so much for your question. The next question comes from Mark Rothschild with Conacor Genuiti. Your line is now open.

The tenant sales to reflect.

Operator: Thank you so much for your question. The next question comes from Mark Rothschild with Concord Annuity. Your line is now open.

It could be a possible softening economy, we haven't we haven't seen that in our in.

Speaker #7: Thanks, Sam. Good morning. Alex, you went over a number of variables that have driven the stronger fundamentals. Just curious if you see any risk to the downside, whether it's from slowing population growth or the impact of tariffs and how retailers react.

Attendance results.

Mark Rothschild: Thanks, Sam. Good morning. Alex, you went over a number of variables that have driven the stronger fundamentals. I'm just curious if you see any risk to the downside, whether it's from slowing population growth or the impact of tariffs and how retailers react. Could we potentially see some softness that you don't necessarily expect over the next year, or is there just enough demand coming in right now that you should be able to withstand that and continue to drive the same comparable organic growth?

But we also haven't seen any change in the leasing intentions from from the retailers.

And.

When you think about.

Uh huh.

How things are likely to evolve from our business perspective.

Speaker #7: Could we potentially see some softness that you don't necessarily expect over the next year? Or is there just enough demand coming in right that you should be able to withstand that and continue to drive the, you know, the same comparable organic growth?

The bigger driver is really just the shortage of retail space in Canada.

It's the same thing that the other retail Reits are seeing.

Retailers are.

I would say in an aggressive mode.

In terms of trying to secure store locations.

Speaker #3: Yeah, thanks, Mark. I mean, there's a lot in that question, but I would say that, you know, what's really driving our business are, generally speaking, longer-term decisions from retailers.

Alex Avery: Yeah, thanks, Mark. I mean, there's a lot in that question, but I would say that, you know, what's really driving our business are, generally speaking, longer-term decisions from retailers. And, you know, while we haven't seen any change in, you know, the tenant sales to reflect, you know, what could be a possible softening economy, we haven't seen that in our tenants' results. But we also haven't seen any change in the leasing intentions from the retailers. And, you know, when you think about, you know, how things are likely to evolve from our business perspective, the bigger driver is really just the shortage of retail space in Canada. It's the same thing that the other retail REITs are seeing. Retailers are, you know, in an, I would say, in an aggressive mode in terms of trying to secure store locations.

Embedded in the increased guidance that we provided today is maybe not a mathematical.

<unk>.

Quantifiable dynamic but.

Speaker #3: And, you know, while we haven't seen any change in, you know, the tenant sales to reflect a, you know, what could be a possible softening economy, we haven't we haven't seen that in our in our tenants' results.

<unk>.

The.

Pace at which discussions for HBC.

Replacement tenants has been moving the volume of interest.

Yeah.

A big difference between having a space and having a tenant that wants it and having a space and having five tenants that want it it's.

Speaker #3: But we also haven't seen any change in the leasing intentions from the retailers. And, you know, when you when you think , you know, how things are likely to evolve from our business perspective, the bigger driver is really just the shortage of retail space in Canada.

It's a very constructive.

The market right now and so.

I can imagine that.

If tenants where to see erosion in their business. They may take the foot off the gas.

In terms of the leasing intentions, but we're seeing none of that.

Speaker #3: It's the same thing that the other retail REITs are seeing. Retailers are, you know, in a, I would say, in an aggressive mode in terms of trying to secure store locations.

Yes.

The retailer operations were to moderate.

It's also entirely possible that they won't take their foot off the gas on leasing intentions.

Speaker #3: I mean, the, you know, embedded in the increased guidance that we provided today is, you know, maybe not a mathematical or a quantifiable dynamic, but the pace at which discussions for HPC replacement tenants has been moving, the volume of interest I mean, you know, there's a big difference between having a space and having a tenant that wants it and having a space and having five tenants that want it.

But right now.

Alex Avery: I mean, the, you know, embedded in the increased guidance that we provided today is, you know, maybe not a mathematical or a quantifiable dynamic, but the pace at which discussions for HBC replacement tenants has been moving, the volume of interest. I mean, you know, there's a big difference between having a space and having a tenant that wants it and having a space and having five tenants that want it. It's, you know, it's a very constructive market right now. And so, you know, I can imagine that if tenants were to see an erosion in their business, they may take the foot off the gas in terms of their leasing intentions, but we're seeing none of that. And, you know, if retailer operations, you know, were to moderate, it's also entirely possible that they won't take their foot off the gas on leasing intentions.

We're we're increasing guidance because.

The mood of retailers is expansion and.

And doing a lot of leasing.

And just I just wanted to add.

Sort of building on the previous question also.

Downside risk question is upside for us.

Our forecast guidance.

I would say theres more bias to the upside than we see risk on the downside.

Okay, Great. That's helpful. And then maybe just one quick other one.

Speaker #3: It's, you know, 's a very constructive market right now. And so, you ow, I can imagine that if tenants were to see an erosion in their business, they may take the foot off the gas in terms their leasing intentions.

On the unit buyback.

To what extent have you been maximizing what you'd like to do or have you been whether it's just blacked out more than you'd like I've held back on that and I guess part of that question is just what should we expect over the remainder of the year.

Speaker #3: But we're seeing none of that. And, you know, if retailer operations were to moderate, it's entirely possible that they won't take their foot off the gas on leasing intentions.

Yes, thanks Mark.

We have bought back stock every day that we can.

We like to buy back stock, we spent $60 million in the first half of the year, we completed those buybacks at a 30% discount to NAV, which delivers about a 43% return on every dollar that we invest which is.

Speaker #3: But right , you know, we're we're increasing guidance because, you know, the the mood of retailers is, you know, expansion and and doing a lot of leasing.

Alex Avery: But right now, you know, we're increasing guidance because, you know, the mood of retailers is, you know, expansion and doing a lot of leasing.

Pretty difficult to find elsewhere and so it's something we like to do a lot of I would say this year, we have front half weighted it.

Speaker #3: Just for the add. I'm of building on the previous question also. You know, downside risk versus upside risk. In our forecast, our guidance, I would say there's more bias to the upside than we see a risk on downside.

Raghunath Davloor: And just, I just wanted to add, I'm sort of building on the previous question also, you know, downside risk versus upside risk in our forecast guidance. I would say there's more bias to the upside than we see a risk on downside.

In previous years, what we've sometimes found is that we've been in a position where.

We werent able to.

Hum.

I guess actively manage the NCI.

Because of the blackouts, whether they'd be.

Speaker #2: Okay, great. That's helpful. And then maybe just one quick other one. On the unit buyback, to what extent have you been maximizing what ou'd like to do or have you been whether 's just blacked out more than you'd like, held back on that, and I guess part of that question is just what should we expect over the remainder of the ?

Mark Rothschild: Okay, great. That's helpful. And then maybe just one quick other one. On the unit buyback, to what extent have you been maximizing what you'd like to do, or have you been, whether it's just blacked out more than you'd like, held back on that? And I guess part of that question is just what should we expect over the remainder of the year?

Reporting based or because we had transactions on the go and.

We did.

We did get a lot of buyback activity done in the first half of the year.

We also got a lot of acquisition activity done in the first half of the year.

Speaker #3: Yeah, thanks, Mark. We have bought back stock every day that we can. We like the buyback stock. We spent $60 million in the first half of the year.

Alex Avery: Yeah, thanks, Mark. We have bought back stock every day that we can. We like to buy back stock. We spent $60 million in the first half of the year. We completed those buybacks at a 30% discount to NAV, which delivers about a 43% return on every dollar that we invest, which is pretty difficult to find elsewhere. And so it's something we like to do a lot of. I would say this year we have front half weighted it. In previous years, what we've sometimes found is that we've been in a position where we weren't able to, you know, I guess, actively manage the NCIB because of blackouts, whether they be, you know, reporting-based or because we had transactions on the go. And, you know, we did get a lot of buyback activity done in the first half of the year.

I would say as we look into the back half of the year it'll be at a slower pace for sure.

What what is in closed or the subsequent event note show that we've been buying back units at a much lower pace. Since we went into blackout at the end of June 2500 units. A day, we were at one point doing 60000 units a day in some blocks.

Speaker #3: We completed those buybacks at a 30% discount to NAV, which delivers about a 43% return on every dollar that we invest. Which is pretty difficult to find elsewhere.

Speaker #3: And so, it's something we like to do a lot of. I would say this year we have front half weighted it. In previous years, what we've sometimes found is that we've been in a position where we weren't able to I guess actively manage the NCIB because of blackouts, whether they be, you know, reporting-based or because we had transactions on the go.

But we've accomplished a lot of I mean in.

In general we've accomplished a lot of what we wanted to accomplish in 2025.

$1 billion of acquisitions were $300 million of dispositions since June of last year, we bought back $60 million worth of stock.

It's been it's been an extremely active year and as we look forward we have now.

Speaker #3: And you know, we did get a lot of buyback activity done in the first half of the year. We also got a lot of acquisition activity done in the first half of the year.

<unk> three great acquisitions that we've completed.

Southgate offshore and Lionbridge.

Each of them come with significant.

Alex Avery: We also got a lot of acquisition activity done in the first half of the year. And, you know, I would say as we look into the back half of the year, it'll be at a slower pace for sure. What is enclosed there, the subsequent events notes show that we've been buying back units at a much lower pace since we went into blackout at the end of June, 2,500 units a day. We were at one point doing 60,000 units a day and some blocks. But we've accomplished a lot of, I mean, in general, we've accomplished a lot of what we wanted to accomplish in 2025. You know, a billion dollars of acquisitions, where $300 million of dispositions since June of last year. We bought back $60 million worth of stock. You know, it's been an extremely active year.

They can see that.

Speaker #3: And you ow, I would say as we look into the back half of the year, it'll be at a slower pace for sure. But what enclosed there, the subsequent events, notes, show that we've been buying back units at a much lower pace since we went into blackout at the end of June.

We will power our results over the next couple of years. We've also had HBC open up a compelling set of capital investment opportunities for us.

Some of them are.

Re tenant spaces. Some of them are land that has been made available because of the elimination of restrictions in the leases.

Speaker #3: 2,500 units a day, we were at 1.260,000 units a day and some blocks but we've accomplished a lot of I mean, in general, we've accomplished a lot of what we wanted to accomplish in 2025 you know, a billion dollars of acquisitions where 300 million dollars of dispositions since June of last year.

So I would say.

We've got we've front end loaded.

2025 for sure.

Yeah.

Okay.

Thank you so much for your question. The next question comes from Paul <unk> with CIBC capital markets. Your line is now open.

Speaker #3: We've bought back $60 million worth of stock. You know, it's been it's been an extremely active year. And you know, as we look forward, we have now you know, these three great acquisitions that we've completed: Southgate Oshawa, and Limeridge, each of them come with significant you know, vacancy that you ow, will power our results over the next couple of years.

Hey, good morning, everybody.

Hello, Hey, yes.

Yes.

Okay.

Alex Avery: And, you know, as we look forward, we have now, you know, these three great acquisitions that we've completed: Southgate, Oshawa, and Lime Ridge. Each of them come with significant, you know, vacancies that, you know, will power our results over the next couple of years. We've also had HBC open up a compelling set of capital investment opportunities for us. You know, some of them are re-tenanting spaces. Some of them are, you know, land that has been made available because of the elimination of the restrictions in the leases. And so, you know, I would say we've front-end loaded 2025 for sure.

If we go back.

10, 15 years, you saw some retail chains experiment moving out of the malls into the off mall environment.

Arguably to mixed results.

Given that space is very tight.

In power centers and stuff like that are you seeing.

Speaker #3: We've also had HPC open up a compelling set of capital investment opportunities for us. You know, some of them are re-tenanting spaces, some of them are you know, land that has been made available because of the elimination of the restrictions in the leases.

Maybe different types of retail tenants considered looking at spaces of malls than you were before like.

You mentioned in your opening remarks.

Our marks 82000 square foot marks that typically maybe 10 15 years ago is probably an off mall store and now it's in the mall are you seeing more of that just because of the spaces available.

Speaker #3: And so, you know, I would say we front-end loaded 2025 for sure.

Hi, Tal.

Yes, we've definitely seen a lot of traditional power center box isn't gravitating to the shopping centers that really started back when target went under when they realize that there is really.

Speaker #4: Thank you so much for your questions. The next question comes from Paul Woolley with CIBC Capital Markets. Your line is now open.

Operator: Thank you so much for your questions. The next question comes from Paul Woolley with CIBC Capital Markets. Your line is now open.

Good visible space available in high traffic malls.

Speaker #2: Hey, good morning, ybody.

Tal Woolley: Hey, good morning, everybody.

That hadn't been available in the past so you really saw it guys like marks and.

Speaker #3: Morning, Tom.

Speaker #2: Hello? Hey.

Alex Avery: Morning, Tal.

Speaker #3: Yep.

Mark Rothschild: Hello.

Speaker #2: You know, if we go. If we go back you ow, 10, 15 years, you saw some retail chains experiment moving out of the malls into the off-mall environment.

Tal Woolley: Hey.

Best buy indigo.

Alex Avery: Yeah.

Tal Woolley: You know, if we go back, you know, 10, 15 years, you saw some retail chains experiment moving out of the malls into the off-mall environment, arguably to mix results. Given that space is very tight, you know, in power centers and stuff like that, are you seeing maybe different types of retail tenants consider looking at spaces in malls than you were before? Like, you know, you mentioned in your opening remarks a Marx, you know, your 2,000 square foot Marx. That typically, you know, maybe 10, 15 years ago is probably an off-mall store, and now it's in the mall. Are you seeing more of that just because the space is available?

Guys are typically werent as often going into shopping centers.

That they are now.

Likewise, having said that Theres some mall tenants that have gone to power centers as well on it I think there's just a general lack of space and tenants are looking to grow their footprint.

Speaker #2: Arguably to mixed results. Given that space is very tight, you know, and power centers and stuff like that, are ou seeing maybe different types of retail tenants consider looking at spaces in malls than you before?

The country and Theres really a shortage of space in general.

But the one thing Thats shopping centers do provide for a lot of these.

Speaker #2: Like, you know, you mentioned in your opening remarks a market, you know, any 2,000 square foot market that typically, you know, maybe 10 or 15 years ago was probably an off-mall store.

Got you Scott power centers.

<unk> is really high profile locations thats, what target afford if thats, what Sears afford it and Thats, what HBC is kind of a forward. So yes. Thank you said 15 years ago, you didn't see many grocery stores in shopping centers and now you see grocery stores being added and.

Speaker #2: And now it's in the mall. Are you seeing more of that just because the space is available?

Speaker #3: Hi, Tom. Yeah, we've definitely seen a lot of traditional power center boxes gravitating to the shopping centers. That really started back when Target went under when they realized that there was this really good visible space available in high-traffic malls that hadn't been available in the past.

Pat Sullivan: Hi, Tal. Yeah, we've definitely seen a lot of traditional power center boxes gravitating to the shopping centers. That really started back when Target went under, when they realized that there was this really good visible space available in high-traffic malls that hadn't been available in the past. So you really saw guys like Marx and, you know, Best Buy, Indigo, guys that typically weren't as often going into shopping centers that they are now. You know, likewise, having said that, there's some mall tenants that have gone to power centers as well. And I think there's just a general lack of space, and tenants are looking to grow their footprint across the country. And there's really a shortage of space in general. But the one thing that shopping centers do provide for a lot of these East Coast power centers is really high-profile locations.

We're trying to add in the bay boxes, and we're having some dialogue about that right now.

Okay. That's great and then just on the you updated the guidance for the <unk> acquisition I'm just wondering the lift in the NOI guidance can you, maybe just detail a little bit more clearly.

Speaker #3: So you really saw guys like Marx and you know, Best Buy, Indigo, guys that typically weren't as often going into shopping centers. But they are now.

I know there was a property tax recovery and then you've got some extra bay rent I think.

Is the balance just like.

Leasing activity percentage rent assumptions that kind of stuff can you.

Speaker #3: You know, likewise, having said that, there's some mall tenants that have gone to power centers as well. And I think there's just a general lack of space and tenants are looking to grow their footprint across the country.

Just bridge that maybe a little bit for me.

Yes that would be the most part of it.

So sort of more.

Speaker #3: And there's really a shortage of space in general. But the one thing that shopping centers do provide for a lot of these guys that used to go in power centers is really high-profile locations.

Better visibility into where we think the NOI is going to go from a leasing perspective also.

And some of the dispositions that.

So that's it does move the dial a fair bit.

Speaker #3: That's what Target afforded. That's what Sears afforded. And that's what HPC is going to afford. So you know, like you said, 15 years ago, you didn't see many grocery stores and shopping centers.

But it's also we're increasing our own internal growth forecasts.

Pat Sullivan: That's what Target afforded, that's what Sears afforded, and that's what HBC is going to afford. So, you know, like you said, 15 years ago, you didn't see many grocery stores and shopping centers, and now you see grocery stores being added. And I mean, we're trying to add them in the bay boxes, and we're having some dialogue about that right now.

Speaker #3: And now you see grocery stores being added and I mean, we're trying add them in the big boxes and we're having some dialogue about that right .

Thank you so much for your question.

The next question comes from Brad Sturges with Raymond James Your line is now open.

Speaker #2: Okay, that's at. And then just on the you updated the guidance at the Limeridge quisition. I'm just wondering the lift in the NOI guidance, can you maybe just detail a little bit more clearly?

Yeah.

Hey, there.

Tal Woolley: Okay, that's great. And then just on the, you updated the guidance at the Lime Ridge acquisition. I'm just wondering, the lift in the NOI guidance, can you maybe just detail a little bit more clearly? I know there's a property tax recovery, and then you've got some extra bay rent, I think. Is the balance just like leasing activity, percentage rent, assumptions, that kind of stuff? Can you just bridge that maybe a little bit more clearly for me?

On the on the dispositions and specifically the pool of assets held for sale I guess, there's a few assets sold.

Post quarter, but like how would we or how should we think about.

Speaker #2: I know there's a property tax recovery and then you've got some extra bay rent, I think. Is the balance just like leasing activity percentage rent assumptions, that kind of stuff?

The potential kind of average cap rate or NOI contribution.

That pool of assets, obviously, I think north one could skew to the low end, but how would the rest of them.

Speaker #2: Can you just bridge that maybe a little bit more clearly for me?

Speaker #3: Yeah. Yeah, that would be the most part of it. Just sort of more better visibility into where we think NOI is going to go from a leasing perspective.

The pool of assets held for sale.

Raghunath Davloor: Yeah, yeah, that would be the most part of it. There's sort of more, you know, better visibility into where we think the NOI is going to go from a leasing perspective. Also, there was a delay in some of the dispositions that actually does move the dial a fair bit. But it's also we're increasing our own internal growth forecasts.

It kind of be composed in terms of potential cap rate. If you were to execute a sale.

Yeah, So I think.

Speaker #3: Also, there was a delay in some of the dispositions. That actually does move the dial a fair bit. But it’s also we’re increasing our own internal growth forecasts.

If youre going to try to do it on a $400 million in the assets held for sale whats the average cap rate.

<unk>.

Northland village I think we disclosed is about 40% of that.

Of that $400 million and that would be call. It a six cap kind of range and and then the north point in medicine hat dispositions, but we've completed recently, we're at about seven four.

Speaker #4: Thank you so much for your question. The next question comes from Brad Sturges with Raymond James. Your line is now open.

Operator: Thank you so much for your question. The next question comes from Raghs Burgess with Raymond James. Your line is now open.

Speaker #2: Hey there. Just on the dispositions and specifically the pool of assets held for sale, I ess there's a few assets sold. Post-quarter, but like how would we or how should we think about the potential kind of average cap rate or NOI contribution of that pool of assets?

Alex Avery: Hey there. Just on the dispositions and specifically the pool of assets held for sale, I guess there's a few assets sold post-quarter, but like how would we, or how should we think about the potential kind of average cap rate or NOI contribution of that pool of assets? Obviously, I think Northland could skew to the low end, but you know, how would the rest of the pool of assets held for sale kind of be composed in terms of potential cap rate if you were to execute a sale? Yeah, so I think, you know, if you're going to try to do it on a, you know, there's 400 million in the assets held for sale, what's the average cap rate? Northland Village, I think we disclosed is about 40% of that 400 million. And that would be, you know, call it a six-cap kind of range.

We have some things in the assets held for sale that would be eight eight to nine.

Think on a blended basis, you'd probably be somewhere in the 7% to seven 5% range for the $400 million would be.

A good a good proxy.

That's great that's quite helpful.

My other question would be just online Ridge mall.

I think my understanding is you were more advanced on re leasing the Sears box just any update there in terms of.

When possibly can enter into a lease and then what that might infer in terms of occupancy and rent payments.

We're hoping to get a lease signed in the next 30 to 45 days and.

Now ill turn it over to the tenant later this year.

Thank you so much for your question.

Alex Avery: And then the North Point and Medicine Hat dispositions that we've completed recently, we're at about a 7.4. You know, we have some things in the assets held for sale that would be, you know, eight to nine. But I think on a blended basis, you'd probably be, you know, somewhere in the seven to seven and a half percent range for the 400 million would be a good proxy.

The next question comes from Todd <unk> with Easter Lily Rain, Jerry Your line is now open.

Okay.

Hello, Alex Steve.

Quick question on the <unk> deck slides 10 and 11.

Hello.

On slides 10, and 11, where you talk about the the.

The potential mall acquisition pipeline.

And all of those dots in terms of the malls that you don't own but you are targeting can you quantify like what percentage of those malls are there.

Tal Woolley: That's great. That's quite helpful. And then my other question would be just on Lime Ridge Mall. You know, I think my understanding is you were more advanced on releasing the Sears box and the update there in terms of when possibly you could enter a new lease and then what that might infer in terms of occupancy and rent payments.

And active sellers.

Are those all pension funds and can.

Can you just update us on current conversations.

Can you give us guidance on.

Any of those owners of those malls that might be targets, what would be reasons that they choose not to sell.

Yeah.

Yes interesting question Todd.

Pat Sullivan: We're hoping to get a lease signed in the next 30 to 45 days and have turnover to the tenant later this year.

Late last year, we started messaging that.

The acquisition pipeline was quite large.

Since then we've acquired $1 billion out of that pipeline and.

Operator: Thank you so much for your question. The next question comes from Todd Boyd with Easterly Ranger. Your line is now open.

Your question is timely because as we've been moving through the year that opportunity set is has shrunk because we've taken $1 billion.

Raghunath Davloor: Hello, Alex. Team, quick question on the slides 10 and 11. Hello. On slides 10 and 11, where you talk about the potential mall acquisition pipeline and all of those dots in terms of the malls that you don't own, but you're targeting, can you quantify like what percentage of those malls are there willing and active sellers? And you know, are those all pension funds? And can you just update us on current conversations and give us guidance on any of those owners of those malls that might be targets? What would be reasons that they choose not to sell?

Out of it.

It was pretty substantial and.

And there are.

As you noted there is a lot of bubbles on that.

Slide it doesn't necessarily mean, they are all for sale.

There are still opportunities but.

As we've been moving through the year we've also.

<unk> looked at some assets where.

You sort of.

The onion back and you find that it's not the exact same kind of thought it was.

And so.

Theres somewhere.

We would love to buy them, but the vendors may not be interested there somewhere.

Alex Avery: Yeah, interesting question, Todd. Late last year, we started messaging that, you know, the the acquisition pipeline was was quite large. Since then, we've acquired a billion dollars out of that pipeline. And your your question is is timely because as we've been moving through the year, you know, that opportunity set has has shrunken because we've taken a billion dollars out of it, which is pretty substantial. And and there are, you know, as you noted, there's a lot of bubbles on that slide. It doesn't necessarily mean they're all for sale. You know, there are still opportunities, but you know, as we've been moving through the year, we've also you know looked at some assets where you know, you sort of peel the onion back and you find that it's not the exact same kind of onion that you thought it was.

On closer examination.

Less inclined ourselves.

So it's.

Drifting, but taking $1 billion out of that pipeline has really.

What I would what I would describe as the <unk>.

Rebalancing at the beginning of the year. It was it was sort of an overwhelming acquisition opportunity.

<unk>.

We've had a number of things I mentioned earlier.

The HBC opportunity buys.

Buying back stock.

We're quite focused on some of the dispositions and with the acquisitions that we've completed.

Not just this year, but over the last three and a half years.

Lot of the portfolio.

Construction and composition objectives that we were targeting.

We're much much closer to the finish line and then we were even a year ago.

Alex Avery: And so you know, there's some where we would love to buy them, but the vendors may not be interested. There's somewhere, you know, on closer examination, we're you know less inclined ourselves. So it's it's interesting, but taking a billion dollars out of that pipeline has really helped what I would what I would describe as sort of rebalance things. At the beginning of the year, it was it was sort of an overwhelming acquisition opportunity. And you know, we've we've had a number of things I mentioned earlier, you know, the HBC opportunity, buying back stock. You know, we're we're quite focused on some of the dispositions.

Our average tenant sales are now $784 a square foot.

<unk>.

It's.

It's been a dramatic shift in terms of a lot of the things we've talked about we've talked about.

The.

The objective of becoming the first call for <unk>.

Retailers.

We had a really.

<unk> seen a market shift in our dialogue with retailers as they.

On a fairly regular basis retailers will come to us and say like well your largest landlord in Canada.

Kind of crept up on us and these acquisitions have been.

Helpful.

And there's also even where we have alignment where we've got a vendor who wants to sell and we want to buy.

Alex Avery: And with the acquisitions that we've completed, not just this year, but over the last three and a half years, a lot of the portfolio construction and composition objectives that we were targeting were were much, much closer to the finish line than than we were even a year ago. Our average tenant sales are now $784 a square foot, which is, you know, it's it's been a dramatic shift in terms of a lot of the things we talk about. We talk about the you know, the objective of becoming the first call for for retailers.

Often we don't align on valuation.

So there is.

I would say we're in a much more balanced position than we were.

Certainly nine months ago or a year ago.

Yes.

Hopefully, we will be able to make some further acquisitions, but.

We've accomplished quite a bit.

Yes, no doubt the accomplishment is legitimate too.

So in your press release, you highlight the three year target you go more than $1 billion of acquisitions, you've done $1 three.

Alex Avery: And you know, we've we've really seen a marked shift in our dialogue with retailers as they, you know, on a on a fairly regular basis, retailers will come to us and say like, "Wow, you're our largest landlord in Canada." You know, kind of crept up on us, and you know, these acquisitions have been been helpful. And there's also, you know, even where we have alignment, where we've got a vendor who wants to sell and we want to buy, often we don't align on valuation. So there's, you know, there's I would say we're in a much more balanced position than we were certainly nine months ago or a year ago. It's you know, hopefully, we'll be able to make some further acquisitions, but you know, we've we've accomplished quite a bit.

Even more than that.

If you include the new the new stuff.

Question is.

Do you have or do you expect to put out in the next six months and new acquisition target.

For us to think about.

Okay.

Yes.

We've thought about that.

And.

I think.

Where we were a year ago.

Having an acquisition targets reflected a lot of the objectives that we were targeting.

And it really was a we felt that we needed to acquire.

A number of these top tier malls to really.

Cheese that first call for retailers type of a.

Objective.

We declined to update that because.

We don't really have the same.

Raghunath Davloor: Yeah, no doubt that the accomplishment is is you know legitimate. And I know in your press release, you highlight the three-year target, your goal, more than a billion of acquisitions. You've done a billion three. I mean, I think it's even more than that. If you include the the new the new stuff. So the the question is, do you have or do you expect to put out in the next, you know, six months a new acquisition target for for us to think about?

Stan I would say at this point.

It's much more of an opportunistic.

Type of.

There are things that we would love to do but.

They have to work for us.

We're starting to see some competition in the mall market as well there are some other.

Private equity buyers who.

And are willing to pay price.

Prices that we're not willing to pay.

Alex Avery: Yeah, you know, we've we've thought about that. And you know, I I think where we were a year ago, having an acquisition target reflected, you know, a lot of the objectives that we were targeting. And then it really was a, you know, we we felt that we needed to acquire a number of these top-tier malls to really, you know, achieve that first call for retailers type of a objective. And you know, we declined to update that because we don't really have the same stance, I would say, at this point. It's much more of an opportunistic type of a, you know, there are things that we would love to do, but you know, they have to work for us. And you know, we're starting to see some competition in the mall market as well.

Which is both good and bad I think having some.

Some other buyers participate in the market that we participate in.

We very much look forward to having a benchmark transaction.

For a top tier mall I.

I mean, it's a challenge.

I'm trying to figure out things like NAV.

We've been such a dominant buyer in the market.

We're actually really thrilled to see some other people stepping in.

At the same prices that frankly, we are comfortable.

Okay.

Thank you so much for your questions. As a reminder, if you would like to ask a question. Please press star and then the number one on your telephone keypad. Our next question comes from <unk> with RBC capital markets. Your line is now open.

Alex Avery: There are some other private equity buyers who you know are willing to pay prices that we're not willing to pay, which is, you know, both good and bad. I think having some some other buyers participate in the market that we participate in, you know, we we very much look forward to having a benchmark transaction for a top-tier mall. I mean, it's a challenge, you know, trying to figure out, you know, things like NAV. You know, when we've been such a dominant buyer in the market, we're we're actually really thrilled to see some other people stepping in and and paying prices that, frankly, we are not comfortable paying.

Thanks, Good morning.

Alex I think you mentioned earlier on.

Discussions with residential developers on some of those HBC boxes can you maybe just provide some more color there and potentially quantify that opportunity on selling some of that space and if theres any sense of timing of when something like that could happen.

Thanks Tommy.

Interesting.

Dynamic.

I think I mentioned it but the.

The.

I guess disclaiming of five HBC leases that we've had.

Opened up fairly significant.

Opportunities in terms of.

Using land that was otherwise encumbered in the past.

<unk>.

And I think the way to think about it is that value has.

Operator: Thank you so much for your questions. As a reminder, if you would like to ask a question, please press star and then the number one on your telephone keypad. Our next question comes from Pammy Burr with RBC Capital Markets. Your line is now open.

Where that opportunity set has accrued to us.

We are fairly active in terms of figuring out what to do with that stuff but.

<unk>.

From a I guess a.

Pat Sullivan: Thanks. Good morning. Alex, I think you mentioned earlier on discussions with residential developers on some of those HBC boxes. Can you maybe just provide some more color there and potentially quantify that opportunity on selling some of that space? And if there's any sense of timing of when something like that could happen. Thanks.

Trying to get stuff done quickly to for instance pay for some of the construction.

Construction and tenant allowance worth to read.

Lease the bay boxes.

No.

We have lots of liquidity and we have lots of capital and so.

As we are approaching this opportunity set.

Alex Avery: Thanks, Pammy. It's an interesting dynamic. And I think I mentioned it, but the, I guess, disclaiming of the five HBC leases that we've had have opened up fairly significant opportunities in terms of, you know, using land that was otherwise encumbered in the past. And I think the way to think about it is that that value has or that opportunity set has accrued to us. We are, you know, fairly active in terms of figuring out what to do with that stuff. But from a, I guess, a trying to get stuff done quickly to, for instance, pay for some of the, you know, construction and tenant allowance work to re-lease the bay boxes. Now, we have lots of liquidity and we have lots of capital.

In terms of the excess land and residential opportunities.

Really more of the executing it right than it is about executing it quickly.

We want to have good residential developments to the extent that the residential at our shopping centers, we have discussions with developers and a lot of these developers do residential but they also will do hotels. They can do self storage. They can do a lot of other things and so.

We've got a team here that works a lot on what.

What's the best use for a lot of this excess lenders and in fact at all.

At our upcoming gallery to look at Battelle property tour on September 25th we will have a.

Local developer that we've been spending a lot of time with.

Looking at the excess lands.

Capital.

90 acres site and the mall, probably requires 55 acres of that.

It's a lot of excess land, there and Theres a lot of Optionality. So I think I think we will provide some good insights in September.

Alex Avery: And so, as we're approaching, you know, this opportunity set, in terms of the the excess land and and residential opportunities, it's really more about executing it right than it is about executing it quickly. you know, we want to have, good residential developments to the extent that they're residential at our shopping centers. You know, we have discussions with developers. And a lot of these developers do residential, but they also will do hotels. They can do self-storage. They can do a lot of other things. And so, we've got a a team here that works a lot on, you know, what the best use for a lot of this excess land is.

How we think about.

The different uses and what to do but.

We have a.

Land sale.

To a residential developer that's in process elsewhere.

And that predates the HBC news, but.

It's definitely something that we're moving on but we're doing it.

In a manner to make sure it's the right fit for the shopping center.

<unk>.

Again, we don't have liquidity or capital.

No issues.

Alex Avery: And, in fact, at our, at our upcoming Galerie de la Capitale property tour on September 25th, we'll have a, local developer that we've been spending a lot of time with, you know, looking at the excess lands at, Capitale. I mean, it's a 90-acre site, and, the mall probably requires 55 acres of that. It's, you know, it's a lot of excess land there, and there's a lot of optionality. So I think, I think we'll provide some good insights, in September on, you know, how we think about, the different uses and, and, and what to do. But, you know, we we have a, land sale, to a residential developer that's in process elsewhere, that predates the HBC news. But, it's definitely something that we're moving on, but we're doing it, in a manner to make sure it's the right fit for the shopping center.

Motivate the speed with which we execute.

Yeah.

Okay. Thanks, very much I appreciate the color.

Thanks Bonnie.

Thank you so much for your question.

The next question comes from Matt <unk> with National Bank Financial Your line is now open.

Hey, guys.

<unk> made a lot of progress last year on the recovery ratio front, it's been a little bit more stable. It looks like for the first half of the year in the second half of last year was quite strong can you give us a sense of whether you'd expect kind of improvements on the back half of the year and then also just quickly on the guidance.

Same property NOI, that's hard to straight line rent.

Pretty big step up if you use the first half to the second half.

Is that on kind of these larger leases that you're expecting to get done.

Maybe like a language.

Yeah.

Alex Avery: And, you know, again, we don't have liquidity or, capital, issues to to motivate the speed with which we execute.

Hey, Matt so on the recovery ratio I think Theres a couple of different factors at play here one is.

The acquisitions with the higher level of vacancy.

Muted the impact of the recovery ratio rising.

Pat Sullivan: Okay. Thanks very much. Appreciate the color.

As for why it ticks up in the second half, it's typically because when we do re merchandising and we do new store openings.

Alex Avery: Thanks, Pammy.

Operator: Thank you so much for your question. The next question comes from Matt Korneck with National Bank Financial. Your line is now open.

To which we are doing a lot of new leasing.

Generally those stores opened in the latter part of the year and so that's when we'll start to see recovery ratios right. When we're starting to receive the gross rents from those new tenants.

Mark Rothschild: Hey, guys. You made a lot of progress last year on the recovery ratio front. It's been a little bit more stable, it looks like, for the first half of the year, and the second half of last year was quite strong. Can you give us a sense as to whether you'd expect kind of improvements on the back half of the year? And then also just quickly on the guidance, there's the same property and, sorry, straight line rent. There's a pretty big step up if you use the first half to the second half. is that on kind of these larger leases that you're expecting, to get done in maybe at like a Lime Ridge?

And the second.

Recall the second part of your question had something to do with step right.

The straight line rent just the guidance is for.

I think it's like almost up to 7 million.

Todd.

Call it a little less than $3 million in the first half I don't know if there's a.

Some leasing thats going on.

Could be.

Yes.

Turning to a lot more tenants take occupancy in the second half of the year and the fit outs and handing it over so you do see pick up in straight line rent.

Pat Sullivan: Hey, Matt. so on the recovery ratio, I think there's a couple of different factors at play here. One is the acquisitions with the higher level of vacancy have have muted the impact of the recovery ratio rising. As for why it ticks up in the second half, it's typically because when we do remerchandising and we do new store openings, to which we're doing a lot of new leasing, generally, those stores open in the latter part of the year. And so that's when we'll start to see the recovery ratios rise, when we're starting to receive the gross rents from those new tenants. And the second, I can't recall the second part of your question. I had something to do with step rent.

During the second half of the year, that's that's normal and what we did do in the guidance was we brought down the low end of the range.

In fact suggest more of the rent we collect the.

Cash form them.

Noncash warm.

Okay makes sense and maybe just very quickly on HBC.

If you were to demise the space should we think that you would get kind of rents in that $50 range and if it was a single tenant would they be closer to kind of call. It the high teens.

Mark Rothschild: Yeah, straight line rent. Just the guidance is for, I think it's like almost up to 7 million. You've had, call it a little less than 3 million in the first half. I don't know if there's some leasing that's going to be happening.

And then maybe if you could get a quick sense of if you're demise, what is the cost per square foot to demise.

Okay.

The first year, you rents I think youre going to see something similar to our average and for box rents. The same same kind of concept I think youre going to see upper teens for box rates.

Raghunath Davloor: Yeah, no, it's just a patch point. You know, a lot more tenants take occupancy in the second half of the year and the fit-outs and handing it over. So you do see a pickup in straight line rent, during the second half of the year. That's normal.

Youre going to see 40, 50, maybe even 60 depends on the size of the space.

It really depends on exactly how we carve it up and how big the tenants are and who they are.

The single tenant, it's not likely to be in the upper teens, it's probably to be in the lower teens.

Alex Avery: And what we did do in the guidance was we brought down the low end of the range, which in fact suggests that more of the rent we collect is is in the cash form than the non-cash form.

<unk>.

But it also comes back to the deal and some of these.

Discussions, we're having with large boxes, we're not putting any capital in the tenant is going to put it all in which means theyre going to pay a lower rent.

Mark Rothschild: Okay, makes sense. And maybe just very quickly on on HBC, if you were to demise the space, should we think that you'd get kind of rents in that $50 range? And if it was a single, tenant, would they be closer to kind of call it the high teams? and then maybe if you could give a quick sense of the, if you demise, what is the cost per square foot to demise?

But all of this comes down to exactly who we end up transacting with them what the square Footages.

In terms of the cost per square foot.

I think if we're looking at 100 100000 foot box and we spend $25 million.

400 Bucks, but.

250, <unk> sorry.

Sure.

Pat Sullivan: For CRU rents, I think you're going to see something similar to our average. And for box rents, the same same kind of concept. I think you're going to see upper teams for box rents. You're going to see 40, 50, maybe even 60. Depends on the size of the space. I guess just it really depends on exactly how we carve it up and how big the tenants are and who they are. If it's a single tenant, it's not likely to be in the upper teams. It's probably to be in the lower teams at best. But it also comes back to the deal. And some of these discussions we're having with large boxes, we're not putting any capital in. The tenant's going to put it all in, which means they're going to pay a lower rent.

Thank you so much.

I was just going to say I think we've also framed it as the returns so.

From a return perspective, if we put no capital and the returns are undefined.

But.

We're targeting sort of in that 9% range would be.

The good expectation of the relationship between the cost and the NOI yield.

Okay.

Thank you so much for your questions.

There are no further questions at this time Claire I turn the call back over to you.

Pat Sullivan: But all of this comes down to exactly who we end up transacting with and what the square footage is. In terms of the cost per square foot, I think, you know, if we're looking at a 100,000-foot box and we spend $25 million, that's 400 bucks a foot.

Thank you operator with no further questions. We will close today's call on behalf of the primary scheme. We thank you all for participating and look forward to seeing you at our property tour in September. Thank you very much and have a great weekend.

Okay.

Thank you you may now disconnect your lines.

Raghunath Davloor: 250, though.

Pat Sullivan: 250, sorry. Yeah.

Operator: Thank you so much for your questions.

Alex Avery: Yeah, I think we've... I was just going to say, I think we've also framed it as the return. So, from a return perspective, if we put no capital in, the returns are undefined. but, you know, we're we're targeting sort of in that 9% range would be a a good, expectation of the relationship between the cost and the the NOI yield.

Operator: Thank you so much for your questions. There are no further questions at this time. Claire, I turn the call back over to you.

Claire Mahaney: Thank you, Operator. With no further questions, we'll close today's call. On behalf of the Primaris team, we thank you all for participating and look forward to seeing you at our property tour in September. Thank you very much and have a great long weekend.

Operator: Thank you. You may now disconnect your rent.