TORONTO--(BUSINESS WIRE)-- Primaris Real Estate Investment Trust (“Primaris” or the “Trust”) (TSX: PMZ.UN) announces today its exposure to the Hudson’s Bay Company ULC, the retailer Hudson’s Bay and TheBay.com (“HBC”), in response to HBC’s March 7, 2025, press release stating that it has commenced proceedings under the Companies’ Creditors Arrangement Act.

Primaris has been preparing for this announcement for an extended period of time.

HBC Exposure

As at March 10, 2025, Primaris REIT’s exposure to HBC is as follows:

• 10 HBC locations totaling 1,124,000 square feet of gross leasable area (“GLA”);
• 12th largest tenant by annualized minimum rent;
• Approximately $11.6 million total gross rental revenue, per annum;
• $10.33 weighted average gross rent per occupied square foot;
• Approximately $4.6 million net rental revenue per annum, or 1.4% of total annualized minimum rent;
• $4.14 weighted average net rent per occupied square foot;
• February rent was received for all locations excluding two centres; and
• In addition to the 10 HBC locations in Primaris’ portfolio, there is a shadow-anchor HBC located at Devonshire Mall in Windsor, Ontario which is owned by an unrelated HBC joint venture.

“Primaris REIT has been preparing for this day for a very, very long time, in fact years. We have learned so much over the past 10+ years with the departure of Zellers, Target, Sears, and now potentially HBC,” said Patrick Sullivan, President and Chief Operating Officer. “Although there could be an impact to our financial and operating metrics in the short term, Primaris has detailed plans for all 10 locations, and is ready to take action if and when any locations are disclaimed.”

The below table lists Primaris’ properties with HBC tenancies.

The below table illustrates the weighted average net rent and occupied GLA for Commercial Retail Unit (“CRU”) and large format tenants for Primaris’ portfolio at December 31, 2024. HBC’s weighted average net rent per occupied square foot for the 10 locations is $4.14.

The Primaris portfolio includes over 2,700 stores, of which there are approximately 35 co-tenancy clauses that name HBC. Co-tenancy clauses are provisions commonly found in commercial real estate leases that stipulate certain conditions under which a tenant's rent or other obligations may be reduced or modified. These clauses typically come into effect when specific anchor tenants, such as HBC, or a certain percentage of tenants within a shopping centre or retail complex cease operations or vacate their premises. These clauses may not be triggered simply by HBC closing. The purpose of a co-tenancy clauses is to protect tenants from potential loss of business and foot traffic due to the absence of prominent anchor tenants. Over the past number of decades, reference to anchor requirements and named tenants have been removed from tenants’ leases due to the changing enclosed mall merchandise mix and the reliance on anchor tenants for foot traffic.

About Primaris Real Estate Investment Trust

Primaris is Canada’s only enclosed shopping centre focused REIT, with ownership interests primarily in leading enclosed shopping centres located in growing Canadian markets. The portfolio totals 15.0 million square feet, valued at approximately $4.6 billion at Primaris’ share. Economies of scale are achieved through its fully internal, vertically integrated, full-service national management platform. Primaris is very well-capitalized and is exceptionally well positioned to take advantage of market opportunities at an extraordinary moment in the evolution of the Canadian retail property landscape.

Forward-Looking Statements

Certain statements included in this news release constitute ‘‘forward-looking information’’ or “forward-looking statements” within the meaning of applicable securities laws. The words “will”, “expects”, “plans”, "estimates", “intends” and similar expressions are often intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Specific forward-looking statements made or implied in this news release include but are not limited to statements regarding: Primaris’ future results, performance, prospects and opportunities, including with respect to the impact of the closure of any Hudson Bay Company locations in the portfolio, the Trust’s strategy and plans and the Trust’s portfolio quality. Forward-looking statements are provided for the purpose of presenting information about management’s current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. These statements are not guarantees of future performance and are based on estimates and assumptions that are inherently subject to risks and uncertainties. Primaris cautions that although it is believed that the assumptions are reasonable in the circumstances, actual results, performance or achievements of Primaris may differ materially from the expectations set out in the forward-looking statements. Material risk factors and assumptions include those set out in the Trust’s management’s discussion and analysis for the three months and years ended December 31, 2024 and 2023 (“MD&A”) which is available on SEDAR+, and in Primaris’ other materials filed with the Canadian securities regulatory authorities from time to time. Given these risks, undue reliance should not be placed on these forward-looking statements, which apply only as of their dates. Other than as specifically required by law, Primaris undertakes no obligation to update any forward-looking statements to reflect new information, subsequent or otherwise.

Non-GAAP Measures

The Trust’s financial statements are prepared in accordance with IFRS accounting standards as issued by the IASB, however, in this news release, Primaris also uses a number of measures which do not have a standardized meaning prescribed under generally accepted accounting principles (“GAAP”) in accordance with IFRS. These non-GAAP measures, which are denoted in this news release by the suffix “**” include non-GAAP financial measures and non-GAAP ratios, each as defined in National Instrument 52-112, Non-GAAP and Other Financial Measures Disclosure ("NI 52-112"). None of these non-GAAP measures should be construed as an alternative to financial measures calculated in accordance with GAAP. Furthermore, these non-GAAP measures may not be comparable to similar measures presented by other real estate entities and should not be construed as an alternative to financial measures determined in accordance with IFRS. Additional information regarding these non-GAAP measures, including definitions, an explanation of management’s reasons as to why it believe the measure is useful to investor can be found in the section entitled :Non-GAAP Measures” in the MD&A. Reconciliations to the most directly comparable GAAP figure, where applicable, can be found in the Trust’s MD&A, which is available on the Trust’s profile on SEDAR+ at www.sedarplus.ca.

Use of Operating Metrics

Primaris uses certain operating metrics to monitor and measure the operational performance of its portfolio. Operating metrics in this news release include, amount others, in-place occupancy, weighted average gross rent per occupied square foot and weighted average net rent per occupied square foot. These operating metrics, which may constitute supplementary financial measures as defined in NI 52-112, are not derived from directly comparable measures contained in the Trust’s financial statements but may be used by management and disclosed on a periodic basis to depict the historical or future expected operating performance of the Trust’ portfolio. Weighted average gross rent per occupied square foot is defined as total annual gross rent divided by occupied GLA.

Primaris also uses certain nonfinancial operating metrics to describe its portfolio and portfolio operation performance. Non-financial operation metrics in this news release include, among others, gross leasable area (“GLA”) and weighted average lease term. For greater certainty, the portfolio operating metrics in this news release include only the Trust’s proportionate ownership of the 8 properties held in co-ownerships.

For more information: TSX: PMZ.UN www.primarisreit.com www.sedarplus.ca

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