Impacts of the pandemic: Cominar downgrades the value of certain shopping centers

The pandemic will have hit Cominar and its shopping centers hard. The Quebec real estate investment fund is forced to reduce the value of all of its buildings by more than $ 300 million.

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On Friday, Cominar announced financial results for its second quarter of 2020. Management also provided an update on the impacts of COVID-19 on the group’s finances.

Between April and June, the fund recorded a net loss of $ 318.1 million, mainly attributable to the review of its assets. In 2019, for this period, net income reached $ 51.5 million. In addition, the debt ratio of the company is on the rise. It is now 54.5%.

“The COVID-19 pandemic has had a significant adverse effect on our financial results,” concedes Sylvain Cossette, President and CEO, in a press release.

Due to the impacts of the virus, Cominar says it has adjusted downward by $ 251.5 million the value of its portfolio in the commercial sector. For shopping centers, the correction was $ 165 million.

Cominar notably owns Place de la Cité, in Quebec, Mail Champlain, in Brossard, and Center Rockland, in Montreal.

46% of commercial rents

So far, the fund says it has received approximately 75% of the gross rent billed for the months of April, May and June.

This percentage should, however, climb to 90% thanks to the sums to be received in connection with emergency assistance from Canada for commercial rent (AUCLC) from the two levels of government, specifies the management.

Not surprisingly, the commercial division was the most affected for rents. Cominar received approximately 46% of the amounts from merchants. This percentage should also increase with the financial assistance measures.

In addition, Cominar is still seeking to sell certain properties. In June, buildings held for sale totaled $ 245.5 million. These are mainly office buildings. In the previous quarter, the market value of the buildings was $ 24.4 million.

“We recognize the challenges ahead in the commercial sector, but remain optimistic about essential services, general merchandise retailers and other segments of the retail sector that are showing great resilience, ”concludes Cossette.

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