Jan Sucharda, President & CEO, Brookfield Canada Office Properties

Notwithstanding the volatility of the domestic and global capital markets domestically, the Canadian REIT market has outperformed virtually all other asset classes. The opening presentation will provide a brief overview of some of the key factors that have contributed to these conditions and results over the last 12 months, both positively and negatively.

Carolyn Blair, Managing Director, RBC Capital Markets Real Estate Group

How strong is the case for investing in publicly listed real estate at this time? How extensive is the shortage of yield in today’s investment market? In light of the challenges faced by other asset classes, is real estate outperforming most vehicles offering investors steady and favourable yields? This session will examine these and other questions in-depth. Some Canadian vs. U.S. market perspectives will be addressed.

• What are the most significant challenges facing the North American capital markets at this time? What needs to occur in order to resolve these issues?
• How does securitized real estate stack up against other investment options with respect to raising equity or debt?
• What major priorities are used to evaluate public real estate companies in this market environment, e.g. balance sheet strength, liquidity, distribution coverage?
• Do the capital and investor markets favour larger real estate entities or do they simply want the existing ones to get bigger? Are micro-caps dead?
• Are the good total returns from REITs, REOCs and real estate in general sustainable? What might cause the “Good Times” to reverse? Is any landing likely to be a soft one?
• What performance metrics are most important at this time? Benchmarking REITs vs. Canadian stocks and Global REIT indices
• How important is funds flow? What roles are ETFs playing?
• What does a REIT of REOC need to do to enhance unit holder value from your perspective?
• Should diversification be provided by individual REITs/REOCs or by investor’s portfolio management?
• Is “macro” uncertainty more dominant than typical risks associated with REITs, REOCs or any single real estate entity?
• What would cause one to shift away from REITs and REOCs? Into what?
  

Moderator:
William Wong, Managing Director, RBC Capital Markets Real Estate Group

Panel: 
Steve Carroll, Managing Director, Senior Global Portfolio Manager, CBRE Clarion Securities
Tom Dicker, Portfolio Manager, Dynamic Funds
Dennis Mitchell, CIO & Senior Portfolio Manager, Sentry Investments
Michael Smith, Managing Director, Real Estate Equity Research, Macquarie Securities Group

In Canada, retail investors are the most significant unitholders of REITs while in the United States, investors tend to more institutional. What are the reasons for this major difference? Is it because Canadian capital and institutional markets do not understand the REIT sector very well? Or is it because our largest pension funds also have real estate operating and investment platforms? But that still leaves a considerable amount of mid and smaller sized pension funds who don’t have that inhouse component. What are Canadian pension funds thinking with respect to their alternatives in the unpredictable equity markets? How do U.S. investors differ in their views from those of Canadian investors? Some of the questions that will be examined:

• Historical performance of direct vs. indirect investing in real estate
• Can performance be accurately measured in indirect markets?
• How important is liquidity and is it really available from REITs?
• Role of time horizons for pension funds vs. traditional REIT investors
• Role of debt for pension funds vs. traditional REIT investors
• Will Canadian pension funds likely privatize more REITs?
• Finite life vs. infinite life vehicles
• Governance in public versus private vehicles
  

Moderator:
Andre Kuzmicki, Executive Director, Program in Real Estate and Infrastructure, Schulich School of Business

Panel:
William Briscoe, Managing Director & COO, Triovest Realty Advisors
Michael Latimer, Executive Vice President & CIO, OMERS
John Parsons, Managing Director, MacGregor Associates
Sharon Sallows, Director, OTPP; Trustee, RioCan REIT; Trustee, Chartwell Seniors Housing REIT

The ongoing abundance of “cheap debt” continues to be rather unprecedented. Institutional investors and many lenders have increased their allocations to commercial real estate, and retail investors have moved in as well to satisfy their search for some reasonable yield. This session will examine how REITs and REOCs are managing their balance sheets in this very competitive environment, and an understanding of the cost of capital and its impact on current market conditions. Among the questions that will be discussed:

• How do you evaluate the benefits of the major options for raising debt or equity capital: issuing more units vs. preferred shares vs. convertible debentures vs. unsecured debt vs. secured debt?
• What is the right capital structure and appropriate level of debt for a Canadian REIT?
• How do development, CAPEX, acquisitions, and payout ratio affect capital structure?
• What are some examples of creative financing that REITs and RECOs have used to raise capital in this market?
• How do private REITs access capital? Does this present advantages or disadvantages vs. public REITs?
• Where does the cost of capital appear to heading over the next 12-18 months in Canada?
• How do you strategically structure the maturing of your debt?
• Are capital markets forcing a short term view even though real estate is a long term focused market?
• Are leverage parameters being changed under IFRS?
• What are the roles and practices of rating agencies in how they treat unsecured debt?
  

Moderator:
Sheila Botting, Senior Practice Partner, Client Cabinet, National Leader, Deloitte Real Estate, Deloitte

Panel:
Rags Davloor, Executive Vice President & CFO, RioCan REIT 

Ryan Fitzgerald, Vice President, Portfolio Management, CI Investments Inc.

Heather Kirk, Director, Real Estate Equity Research, National Bank Financial Inc.
Vlad Volodarski, Chief Financial Officer, Chartwell Seniors Housing REIT

The session will open with a brief overview of the major fundamentals of the office, industrial, retail and multi-unit residential markets across Canada. How have they been performing in the first half of 2012? What is the likely outlook for the remainder of the year? A panel discussion will then follow focusing on what are some of the most significant challenges, risks and opportunities that a REIT COO is facing in managing assets in these market conditions. The questions examined will include:

• Where are cap rates heading? Do current fundamentals support acquisitions?
• What are the biggest value determinants in various markets now? How is the “value-added” measured?
• As cap rate compression eases, what are REITs doing to squeeze out revenue growth?
• What can a REIT do to deliver organic growth and manage costs effectively?
• Is AFFO per unit and NAV per unit growth more important than asset growth?
• How does all this relate to a REIT’s need to balance yield vs. creating deferred benefits?
• Is there a housing bubble in Canada? Will this really matter to REITs?
  

Moderator & Presenter:
Sandy McNair, President, Altus InSite

Panel:
Tom Burns, Executive Vice President & COO, Allied Properties REIT
Steve Evans, Co-Chief Executive Officer, Pure Industrial REIT
Louis Forbes, Executive Vice President & CFO, Primaris Retail REIT

Canadian senior executives used to focus primarily on domestic and to some extent U.S. economic fundamentals as a key part of evaluating risks and determining their strategy going forward. But times have now changed. A considerably growing amount of time is now focused on trying to understand geo-economic trends and macro risks which are creating greater concerns and questions about what lies ahead for the global and eventually the Canadian economies. This presentation will examine some of the current issues facing European markets, China, the United States and other tier one countries and emerging markets. What lies ahead for the remainder of this year and eventually for 2013? What implications will these trends have on the Canadian economy?

Using a wireless survey, the audience will be polled for their predictions prior to the presentation. You will have an opportunity to compare your thinking with the expert’s views.

Speaker:
Craig Wright, Senior Vice President & Chief Economist, Royal Bank of Canada

The session will open with a brief overview comparing the size, performance and various global REIT markets to Canada. What new REIT markets have emerged since last year’s RealREIT conference? Which Canadian REITs are now investing outside of Canada? A panel discussion will then follow with REIT executives and global portfolio managers.

• What are the emerging trends in global real estate markets? What are the best opportunities now? How does Canada stack up vs. global REIT markets?
• What possible impact will the EuroZone issues have on global REIT markets?
• What are the tax implications for Canadian investors investing in non-Canadian REITs? Are Canadian REITs well equipped to acquire and operate foreign assets?
• What Canadian structures exist for Canadians to invest in foreign properties? What are their advantages and disadvantages?
• Why should Canadian investors buy Canadian REITs with foreign assets instead of buying “best in class” local REITs in foreign markets?
• How is FX risk dealt with in light of high payout ratios?
• Should Canadian REITs be vehicles for investing in foreign properties?
  

Moderator:
Tom Rothfischer, GTA Real Estate Practice Leader, Partner, KPMG LLP

Panel:
Stéphane Larsen, Portfolio Manager, Europe, Presima Inc.
Karine MacIndoe, Managing Director, Real Estate/REIT Analyst, Equity Research, BMO Capital Markets
Doug Quesnel, Chief Financial Officer, Dundee International REIT
Corrado Russo, Managing Director, Real Estate Securities, Timbercreek Asset Management

One of the questions facing public real estate companies is whether new development is an appropriate strategic means for growth. On the one hand, significant cap rate compression and the lack of good quality assets for sale make it difficult for them to use an acquisition program to grow. On the other side, market and political forces are fostering urbanization, intensification and new development. This panel will examine these questions in greater detail to determine to what extent REITs and REOCs should pursue development strategies.

• How do you determine the right price to pay for properties in this market?
• Are private equity funds or institutional investors squeezing REITs out of market?
• Are there sufficient properties in Canada available to allow REITs and REOCs to grow?
• Do REITs necessarily need to acquire in a low cap environment?
• What are the challenges of developing new properties within a listed REIT/REOC? Are there practical issues that make it difficult to do so or not? What is the ideal way a REIT to approach these opportunities? How are development risks managed? What core competencies are required? What are the in-house staffing requirements?
• Does a REIT/REOC need to attain a certain size/scale before it should engage in development? How much does it cost to carry a development team?
• How will investors, portfolio managers and analysts view development strategies?
• Where are the cost parameters heading associated with respect to inner city land prices and construction costs? What impact are they having on development pro formas?
  

Moderator:
Glenn Hynes, CFO & Secretary, Crombie REIT

Panel:
Michael Markidis, Vice President, Global Research, RBC Capital Markets
Armin Martens, President & CEO, Artis REIT
Jordan Robins, Senior Vice President, Planning & Development, RioCan REIT
Stephen Taylor, President & COO, Morguard Investments Limited

A wide ranging discussion among portfolio managers and real estate analysts on issues and trends that they see evolving within Canadian public real estate companies.

• Do we need more REIT IPOs? If so, what characteristics should they have, e.g. internal vs. external management, diversification vs. pure play, foreign assets, scale, asset quality?
• Why should investors buy more shares or units of public real estate companies now?
• Under what circumstances should they raise equity?
• Would a common AFFO definition assist your decision-making?
• Does structure matter, e.g. REIT, REOC, FAIT, ETF? What are the advantages and disadvantages of these structures for a REIT or REOC? For investors? For issuers? What are the implications for liquidity? Governance? Growth potential? Risk? Cost to run? Cost to issue? Cost to trade?
• What is the performance track record of these vehicles? Does structure affect performance? Are different types of investors attracted to different types of structures? Institutional vs. retail? Taxable vs. non-taxable? Domestic vs. foreign?
• How does management compensation affect performance and your decision to invest or recommend?
• What price should REITs or REOCs pay for assets in this market?
  

Moderator:
Stephen Sender, Managing Director, Industry Head, Real Estate, Global Investment Banking, Scotiabank

Panel:
Anish Chopra, Managing Director & Portfolio Manager, TD Asset Management
Bill Crow, Managing Director, Real Estate Equity Research, Raymond James & Associates
Andrew Moffs, President & Portfolio Manager, SRE Securities Canada Inc.
Andrew Nasr, Executive Director, Portfolio Manager, Middlefield Capital Corporation

An insightful examination of challenges, trends and issues facing Canadian REITs and REOCs, and what CEOs and senior investors are doing as they continue to face the turbulent environment of the past few years. The following are some of the questions that will be examined:

• Is the good performance of REITs and REOCs sustainable? Are they currently priced for perfection?
• What do you consider to be the greatest risks to your business at this time?
• What are the three most significant things that you need to do “right” in order to deliver unitholder value? Is it necessary to grow assets in order to be successful as a REIT?
• How much development activity is appropriate for REITs? How should it be funded?
• What are the advantages and disadvantages of investing in foreign assets? Is it worthwhile?
• If you had it all to do over again, would you rather be public or private? If private, what would be primary sources of your capital?
• How much debt is appropriate for REITs and REOCs to carry on their balance sheets?
• What is an optimal capital structure/payout ratio to minimize your cost of capital and maximize growth?
• Do you think that pension funds should own REIT units? What can you offer them that they can’t obtain from direct investment or “club” deals?Do you see more M&A activity in the next 12 months?
• What are the most pressing governance issues facing public real estate entities right now?
• If cap rate compression is nearly done, is this good or bad for REITs and REOCs? How do you determine the right price to pay for an asset in this market?
• When do you anticipate Canadian interest rates to rise? What impact will this have on REITs?
  

Moderator:
Jan Sucharda, President & CEO, Brookfield Canada Office Properties

Panel:
Michael Cooper, Vice Chairman & CEO, Dundee REIT
Neil Downey, Managing Director & Real Estate Analyst, RBC Capital Markets
Michael Emory, President & CEO, Allied Properties REIT
Tom Schwartz, President & CEO, CAPREIT
Edward Sonshine, Chief Executive Officer, RioCan REIT