Good day, ladies and gentlemen. Welcome to the SmartCentres REIT Q3 2026 conference call. I would like to introduce Mr. Peter Slan. Please go ahead.
Thanks, operator, and good afternoon, everyone, and welcome to SmartCentres' third quarter 2026 results call. I'm Peter Slan, Chief Financial Officer, and I'm joined on today's call by Mitch Goldhar, Executive Chair and CEO, and by Rudy Gobin, our Chief Portfolio and Asset Management Officer. We'll begin today's call with comments from Mitch. Rudy will then provide some operational highlights, and I will review our financial results. We will then be pleased to take your questions. Just before I turn the call over to Mitch, I would like to refer you specifically to the cautionary language about forward-looking information, which can be found at the front of our MD&A. This also applies to comments that any of the speakers make today. Mitch, over to you.
Thank you, Peter. Good afternoon and welcome, everyone. I will be brief so we can get to your questions. Q3 was a solid performer for SmartCentres. Our results speak to stability and resilience of our retail portfolio, while our development initiatives progress in the same disciplined manner that got us here in the first place. Here are a few additional highlights. Same property NOI delivered a healthy 3.8% ex-anchors, or 2.5% all-in, and 2.7% all-in ex-multi-res. Occupancy continues to move up, reaching 98.2% for in-place and committed deals, a reflection of new entrants and higher tenant retention at near 90% already. Steady organic growth with rental lifts up 11.8%, excluding anchors, on lease extensions.
We leased more than 430,000 sq ft of space this quarter, including approximately 104,000 sq ft of vacant space and about 330,000 sq ft of new-build retail space, including a Walmart lease in Kingston, reflecting good retail demand for expansion. Our commitment to and expertise in greenfield developments align with the needs of our core retail relationships in pushing forward our new retail growth program. Grocery, Walmart, Canadian Tire, value apparel, dollar stores, drug stores are among the phase one uses we are anticipating opening in our new centers. In terms of capital recycling, we are putting in motion dispositions of certain less strategic assets, officially designating them as assets held for sale or sold in the quarter, totaling CAD 50 million. The strength of our retail relationship continues to be one of our key competitive advantages.
We continue to see growth from many of Canada's leading retailers, including Walmart, Canadian Tire, grocery, pharmacy, and a list of specialty and experiential tenants. Our self-storage platform also reached a new important milestone this quarter. We completed construction of the Notre-Dame and Laval East facilities, increasing our operating portfolio to 16 facilities. This platform continues to provide an additional and growing stream of recurring rental income and creates meaningful long-term value for our unitholders. From a balance sheet perspective, we remain disciplined and focused on maintaining financial flexibility. Subsequent to the quarter end, we issued CAD 450 million of unsecured debentures, extending our maturity profile and using the proceeds to repay maturing debt and floating rate borrowings. Approximately 83% of our debt remains at fixed rates, providing meaningful protection against interest rate volatility. Our stable leverage and improved unencumbered pool, now at CAD 10.2 billion, provides ample liquidity.
Overall, our strategy remains unchanged and on course. We continue to focus on growing cash flow through retail lease, enhancing our existing portfolio, pursuing selective development opportunities, and maintaining a strong balance sheet. With that, I will pass the call over to Rudy for some more operational highlights.
Thanks, Mitch, and good afternoon, everyone. Building momentum from the beginning of the year, occupancy has improved from 97.6% to 98.2% at the end of Q3, having executed deals this quarter with Sobeys, Loblaws, Winners, HomeSense, Dollarama, and Marshalls. This momentum is expected to continue for the balance of the year. We are simultaneously adding to the tenant mix and driving traffic to our sites with entertainment, specialty fitness, daycare, medical, and more, reinforced with a greater variety of grocers, both mainstream and niche. We are also pleased with our progress in securing commitments for the ex-Toys locations with stronger retailers generating higher rents and year-round traffic, and with better covenants, with commitments in place for four locations at quarter end and a fifth location committed shortly after the quarter end.
Lease extensions reached 89% on lease maturities in the year, with a 6.8% overall rental increase, or 11.8% excluding anchors. The portfolio resiliency continues as it has for many years, at near or over 90% retention from the strongest retailers in Canada. From an NOI perspective, same property NOI grew at 2.5% all in, or 3.8% ex-anchors, on track with our expectation and fiscal 2026 forecast. Turning to cash flow, cash collections remain strong at 99% in the quarter and with no major tenant disruptions. Toronto and Montreal Premium Outlets also delivered strong results, with improving tenant sales and strong traffic expected for the fast-approaching holiday season. The near 100,000 sq ft Toronto expansion is moving through the tender process, hoping to commence before year-end. Overall, we expect this momentum to through year-end. Thank you, and I'll now turn it over to Peter. Peter?
Thanks, Rudy. As you have seen in our press release, FFO this quarter was CAD 0.54 per unit, compared to CAD 0.59 per unit in the same quarter last year. The decrease is primarily attributable to CAD 0.03 per unit from the total return swap in the prior year, which was unwound in Q2 of this year, together with an increase of CAD 0.02 per unit in interest expense. Of the CAD 0.02, approximately half relates to non-recurring interest on deposits on condo sales, where purchasers have been offered the right to cancel their purchase due to current market conditions. FFO with adjustments, which excludes the townhome profits, transactional gains and losses, and the total return swap, was CAD 0.55 per unit, compared to CAD 0.56 for the same period in 2025. The modest year-over-year decrease was primarily driven by higher interest expense.
We again maintained our distributions during the quarter at an annualized rate of CAD 1.85 per unit. The payout ratio to AFFO remained stable at 90.9% for the rolling 12 months ended September 30, 2026. Adjusted debt to adjusted EBITDA was 9.9 x, up modestly from 9.8 x in the previous quarter. We also classified approximately CAD 47 million of assets, including the REIT's share of equity-accounted investments, as assets held for sale this quarter. We continue to assess other divestiture opportunities and expect to use the proceeds from all dispositions to repay indebtedness. The weighted average term to maturity of our debt, including debt on equity-accounted investments, was three years. From a liquidity perspective, we remain comfortable with our current liquidity position. At September 30, we have approximately CAD 454 million of liquidity, which includes both cash on hand and undrawn credit facilities, but excludes any accordion features.
Subsequent to quarter end, as Mitch noted, we issued CAD 450 million of unsecured debentures, repaying maturing debt and other outstanding amounts on our corporate revolvers. This increased our liquidity to approximately CAD 750 million and improved the weighted average term to maturity to 3.1 years. As in previous quarters, we have updated our MD&A disclosure, focusing on those development projects which are currently under construction. As you will see on page 16, there were seven projects under construction at the end of Q3, a decrease of two from last quarter. Those two, Mitch described earlier, were the self-storage projects at Notre-Dame and Laval East that were completed during the quarter and removed from the list. With that, we would be pleased to take your questions. So operator, can we have the first question on the line, please?
For those of you who would like to ask a question, please press star one on your phone's keypad. Standby. We have some questions queued up. We are just grabbing their names. This will be soon. All right, the first question is from Lorne Kalmar from Desjardins. Please go ahead, Lorne.
Thanks. Good afternoon, everyone. Just focusing in on the development side of things, obviously, the retail development is coming into focus here. I was wondering, and forgive me if I am forgetting, if you could give us an idea of what the yield on cost would be for these Walmart-anchored retail centers that you are pursuing.
Hey, Lorne. Of course, they vary from site to site, but for all intents and purposes, they are accretive. We cannot really get into the actual individual returns, but
Could you give us maybe like a rough range, just so we have some kind of
Well, they come out of the gate upon completion of the center, accretively. And of course, as time goes, rental bumps, etc , et c. But you know what? Until we actually, I guess, get out to tender and firm up some of those details, we would stay away from putting out specific returns. But the various versions are accretive, and we are now out to tender. We are out to tender in Kingston. We actually got prices in that were decent. Negotiating with contractors, so I would rather not get into too much about that. But it is positive. It is solid. I mean, they will contribute to earnings upon completion right away, and will continue to, because the majority of them are long-term leases with bumps.
Okay. And then I guess for Winnipeg and Lindsay, is the idea to hopefully get those shovels in the ground on those for next year?
Yes.
Okay. Then just on the premium outlets, and this might be on me, I was going through the disclosures trying to find some details, and I was wondering, is that project included in the retail development charts you've got here? I think it's on page 18.
Yes. Yes, it is.
Okay. Then I guess I was just like, I think the yield you guys had given on that was around 8%. So if you kind of back into what the yield is on the rest of the projects in there, it seems a little bit low. I was just wondering if you could maybe help me reconcile that.
Yeah, Lorne, it's Peter. That's a project that's still being leased up, as you know. We've got some of the leases that have been signed are in the committed section of that table you're looking at on page 18, and then there's some space that is still under negotiation with Simon and ourselves and prospective tenants, and that's in the uncommitted section. It's a bit of a blend, and we do expect that the overall yield on the project will be in line with what we've stated previously. But we've been conservative in the uncommitted piece because we haven't signed leases yet. Remember, it also includes the parking deck, which is part of the capital cost, but has a different profile.
The other part of that, Lorne, too, is remember, we're 50% of that project. So, we would only be counting half the square footage in that yield. I think that document, that part of the MD&A says uncommitted over 2 million sq ft. So yeah, our share of the expansion is only half of the-
Okay. That makes sense. Okay, thank you for that. Then just maybe last one, just on the debt side of things, with 83% fixed, that's still a decent chunk that's variable, and obviously, who knows what's going to happen with interest rates here. Have you guys thought about trying to fix some more of that and just have certainty on that front, or not so much?
Lorne, it's Peter again. Obviously, the unsecured debentures that we issued in October post Q3 was fixed rate. So, the 83% is as at September 30th, and then we fixed a bit more with the CAD 450 million of debentures that we issued in Q4 that aren't yet reflected. Then there's a balance that most of that balance is construction facilities, which tend to be at variable rates.
Okay. Fair enough. I will turn it back. Thank you so much.
All right. Thank you. The next question is from Sam Damiani from TD Securities. Please go ahead, Sam.
Thank you. Good afternoon. Just want to get an update on the, I guess, the program of this retail shopping center development pipeline. So it sounds like Kingston, shovels maybe early next year, maybe late this year. And the other two, definitely sometime next year. Do you have more in that pipeline that could be announced, that could also commence construction in 2027 or even 2028?
Yes. We do anticipate there to be more announcements in the new year.
With the profile generally of this next round of projects, would they be similar to the three that we already know about? In other words, largely concentrated in GLA, largely concentrated in an anchor?
Yeah, I mean, the projects will be probably commenced phase I with an anchor tenant, a long-term lease with an anchor tenant. But they will be 100%, everything we build will be leased. So, it will go in, phase 1 will be 100% leased in each case. That will be a characteristic of all of them. I mean, don't quote me on it. We may build a tiny bit of some spec space that might be logical, but we generally will not do that. So, they will all be on the leases on the longer end of the spectrum. Yeah, I mean, it may start with more than just one anchor. Could be two anchors, could be two anchors with another large tenant, sub-anchor. The profile will sort of run that range of phase I.
Phase II will be more. Phase I would be, we will start building the anchor, there will probably be other retail being built at the same time, along with all the infrastructure. Phase II will probably come very soon on the coattails of phase I with some more sub-anchors and maybe an anchor or two, and some of the smaller stuff. So, rent will probably commence on. Another characteristic will be rent will probably commence within a year of construction commencement for most all of the tenants, if not earlier. So, that will be a common strain running through all of them. I would say, yeah, we will probably build out the projects quicker than in the past for a variety of reasons, which I will not go into now unless you want to get into that. But that will be a characteristic as well.
I think the turnaround for completion will be shorter, probably three years, in terms of lease up or substantial lease up. That will probably be the profile for everything that we would be announcing next year.
Okay, great. Thank you. I guess, the three on deck all required purchases of land. I know just in the last year or so, there was some land in Bolton, as I recall, that was purchased as well. I wonder if there's an update on that parcel, and also with future developments on the retail side. Are they mostly going to require purchases of new land?
Yep. Yep. We definitely, we are trying to figure out a way to build shopping centers without land.
Okay.
But we haven't figured that one out yet, Sam. But we are happy to report that we've done a food store deal in Bolton, along with a discount apparel retailer combo. We have quite a bit of other interest. So, we've actually commenced construction on that very soon after closing. We have commenced construction there. It's a good long-term food store lease. I mean, they're both, the ones that we're building now are both long-term leases. Yep. Then the phase II will be, I think there's probably a total of six more acres or so to build out that project. But, you know, it's right next to our existing SmartCentres Bolton.
Which is different than what we call our retail growth program, because we do pick up land sometimes beside our shopping centers where we have a user. That's why we picked up Bolton. I mean, it's right beside our Walmart-anchored, Beer Store-anchored, I think we've got a whole bunch of other brand names there, center there, which is great growth community. So, yeah, that was a great opportunity. But that is different than what we were talking about a few minutes ago about buying new sites and building what we were describing a few minutes ago.
And Sam, that is why you do not see Bolton on the table in the MD&A, because it is just an add-on to the existing center, not a brand new greenfield development.
That makes sense. Yeah, I was just hoping or wondering that maybe some existing land could support this program, but it sounds like-
Yeah, there is. I am glad you mentioned that. I mean, there are things going on that are part of this, that because of this, that are coming out of this, whereby we will be adding things to our existing centers as sort of like an adjunct. Once you get into this kind of thing, which is of course what kind of That is our history. That is the origins of the company. Once you get into this, there are other things that go on and adjuncts to existing centers, and that is very much happening.
Actually, I do not know if we have announced anything, but I guess I will resist the temptation to tell you about a few of them, but there will be a number of announcements of very solid retailers going onto some of our existing SmartCentres sites, and I would say that they are really an offshoot of the new store program.
Excellent.
Last minute.
Sorry. Peter, you mentioned something about purchasers being offered to cancel contracts. I guess I didn't catch the full meaning of that or if it was in the MD&A or not, but I wonder if you could just expand on that a little bit just so I could better understand what is the situation there?
Yeah, it was a very difficult decision, but at the end of the day, we had sold a certain number of units there or at Park Place for two very big buildings. Yeah, we made the decision to cancel the project, which subject to coming to terms with the purchasers. We're in the process of settling up with the purchasers, which of course, if they do accept the terms of the cancellation, then we'll give them their interest back on their deposits. That's that one-time event. The reason for canceling the project is it's just not viable. I mean, at those densities and yeah, it's just being conservative, being careful. It was a smaller building and we felt that we could rent out some of the units or defaults that might occur, but it's not in our comfort zone. We canceled the project, unfortunately.
Okay. Thank you. I'll turn it back.
Thank you. The next question is from Mario Saric from Scotia Capital. Please go ahead, Mario.
Hi, thank you. Good afternoon. I guess, Mitch or Peter, I was wondering if you could provide a bit more detail on the assets that are listed, held for sale, or that have been completed, the roughly CAD 50 million, and then what your expectations are for 2027 in that regard.
Sorry. Yeah, I mean, we're not going to name the specific site, but one of them is set to close this year. It's firm. One of them is already I think one of them is already closed. And the other one is desirable, but it's not currently, yeah, under contract or anything. These are all Well, they are HUD sites, just for FYI. In terms of what to expect, I mean, I think we've identified probably up to around CAD 100 million or so of other less strategic properties that are viable to sell. We're just looking at it now. That's why we haven't moved it over. But obviously, we will keep you posted, and that would be sort of a preliminary placeholder kind of existing properties that we could see moving out.
Those are all, aside from two small ones, those would all be non-income-producing properties at the moment, what I just was talking about. Yeah, and the environment's a little bit better, so it's not inconceivable that less strategic income-producing properties at the right cap rate, that lever could be pulled as well if it gets to the point where it's attractive enough. So, we've identified those IPP that we've already got our sights on some IPP that if the market continues to improve the way it has been. We might pull that lever. We'll see and, of course, keep you posted.
Do you have a rough range of the amount of IPP identified that could fit the bill in terms of sale?
If we were to just We would never do it all, but I'd say we probably identified Let's see here. If we did a full list, it would probably be about CAD 230 million-CAD 240 million worth of IPP that at the right cap rate, and of course, I'm not giving you the cap rate when I say that number. I'm just giving you the approximate range that we've identified that could be less strategic as part of our network and our portfolio. So yeah, I think if you just say CAD 200 million-CAD 250 million, and the land up to potentially CAD 100 million, those are a couple of the levers that, if things go right, we might pull those levers.
Interesting. What are some of the common traits within that CAD 200 million-CAD 250 million that would deem the assets non-core?
It's a good question because unfortunately, we do think that we're in good shape at all of our centers. I mean, if you look at our occupancy and then you look at any one of these centers, you would say, "Why would you sell that?" It's really very The reasoning is simply that it might be a very isolated center where there's nothing else we've got anywhere for a long way. Maybe we don't Yeah, so in those cases, let's put it the other way. When we have center Let's say you go up north, you go by Vaughan, then you go by Bradford, then you go by Barrie, and you go by Orillia, and Bracebridge, and Huntsville. I mean, we're in all of those places, and we're part of those communities, and they all know us, and they do shop in each of those different communities at different times.
So, where we are really, really far away from anything else that we have got, those might qualify. There might be one or two other characteristics, which I do not want to get into because someday we might be negotiating with somebody about these, and I do not want it to work against us. But that would be, for example, potentially one characteristic.
Got it. That is really good color. I think I drove past three or four of those centers that you identified a couple weeks ago. Okay.
Yeah, but you are supposed to stop. You are supposed to stop there. You are not supposed to drive by.
I stopped at one of them.
Okay.
Okay. The average leverage profile on these assets is pretty consistent with the overall portfolio? I'm just trying to understand the net potential proceeds that could come out of this. Secondly, would debt repayment still be the predominant source of redeployment?
Yeah, no. Most of these do not have debt on them.
Okay. Just maybe my last question, maybe for Peter, just in terms of, we've talked about the variable rate debt, and rates have been going all over the place. I think sometimes it's challenging to understand actually how much FFO sensitivity there might be for SmartCentres to variable rate debt, because a big part of it or a good chunk of it is being capitalized as part of development and so on. So, is there a rule of thumb that we should think about where a 25 basis point change in the Bank of Canada rate equals X in terms of reported FFO for SmartCentres?
I don't have that sensitivity at my fingertips, Mario, but we've quite consciously chosen to spread out our debt ladder and go heavily on the fixed rate side in order to minimize that kind of exposure. But as you would have seen on our debt ladder, we do have debt that matures in each of the next several years, and so we're not unexposed. We are in a rate-sensitive industry, and you should expect that our interest costs will fluctuate with interest rates to some degree. But as for the specific math, I haven't actually modeled that out for you.
Okay. And just as a follow-up, is it fair to assume if I look at the capitalization of interest relative to the overall interest expense, should we expect that to be fairly constant in 2027 relative to 2026, given some of the development initiatives that you talked about?
Yes. Yes, it will be fairly constant. There's new developments that Mitch discussed, but there's also developments that are concluding. The Canadian Tire lease side is going to come off the list, for example.
ArtWalk.
The ArtWalk condominium project is another. Yeah.
Okay. Thanks, guys.
Thank you. The next question is from Giuliano Thornhill from National Bank Financial. Please go ahead, Giuliano.
Hey, guys. Good afternoon, everyone. I just had one question on the Walmarts that were announced. You have three now in the pipeline, possibly more down the road. Are you considering, or maybe at what point do you think adding a partner here would make sense to kind of expedite the timeline to delivery and just being able to leverage a partner's capital as well?
We always look at everything, and that is one of the things. I think the costs outweigh the benefits at this moment. We do look at that and appreciate the thought. We would not. If the benefits outweighed the costs, we might be doing that. We keep an eye on it, and I think we will get where we are going. It will most likely be without a partner, and you will be, well, if you are a shareholder, a unitholder, you will be happy that we got there. It really is very much just a very short-term, short period of time where we go into debt to build an anchor tenant, and very soon thereafter, the rent commences. It is not like a residential building. So, we look at it, and we consider it. We are certainly not against it if it made sense.
But at the moment, as I say, the costs outweigh the benefits.
Okay. And just on that, where would you guys be comfortable taking the development pipeline to as a share of the balance sheet? Or do you have some guidelines around what you think the max amount that we can support, just given where leverage is right now?
Yeah. So, we have a restriction under our Declaration of Trust of 15% of the total balance sheet can be invested in properties under development. We're currently running in the mid-12s, I think. And so, we're going to keep that number far away from 15. We don't want to get too close. So, 12 to 13 is a range we'd be comfortable with. There's certainly room for it to creep up a little bit as we commence new development projects. As I mentioned in response to the earlier question, there's also projects that'll be coming off the list and come out of PUD, so that'll drive the number back down.
But we have control over it. It's not like there's nobody else who's driving that other than us, so obviously, control is on there.
Yep, of course. Just one last question. On the toy space, is most of that going to be coming online on Q4 and Q1? Yeah, just more of a timing question from myself as to when that GLA will be uptaking.
Hi, Giuliano. Yeah, some will come on in Q4, and it will trickle into the new year, yes.
All right, thanks.
All right, thank you. The next question is from Pammi Bir from RBC Capital Markets. Please go ahead, Pammi.
Thanks. Hi, everyone. Just coming back to the disposition outlook, what sort of reduction in leverage do you think you could achieve by the end of next year? Or maybe said differently, where do you want to be?
Pammi, were you asking where we think we'll get to in terms of dispositions a year from now? By a year from now?
Yeah, that's part of the question. Really, I guess, where do you think your debt levels or your debt-to-EBITDA will be by the end of next year, if you are successful on that magnitude, whatever the magnitude of dispositions is?
Well, it's hard to say exactly where our debt-to-EBITDA will be in a year, but of course, we'll keep an eye on it. I think the market is okay for disposing, unlike, let's say, a year ago. Hopefully, we will complete some of these transactions, and that'll give us a little bit more distance from the super bad debt-to-EBITDA ratios. It's going to be a little bit lumpy. It's not a perfect science, so we'll make those decisions. We have control over commencements. They're all prototypes. It's not like we've got some Frank Lloyd Wright architect developing our buildings, and we don't know what the cost is going to be until we finish. We're building prototypes, and we know exactly what they cost, plus, we're building them over and over. So, we've got really good visibility and control over that.
I guess if we've got a sale that doesn't close on the exact date that something commences. Debt EBITDA goes up and down a little bit. We will tolerate that since it's all pre-leased stuff, and we'll decide on how sure we are about a sale. We're going to just I mean, it's hard to say where we'll be in a year from now, but we're going to be trying to drive it down. We have a plan, and we have a vision, and we're not going to miss out on the opportunity to grow this company creatively, substantially, creatively over time that's available now. We're also not going to commit a folly, so I'm sure you can kind of read between the lines. We'll drive it down as much as we can without giving away the farm.
Okay. All right. Okay. In terms of the drop in the active development pipeline this quarter, I think it went down to just under CAD 400 million. Was the bulk of that really just the completions in the quarter? The second part to that is, how do you see, or what sort of development spending do you expect for 2027?
Well, just for your information, maybe an interesting number, I think we built something like 500 or we're under construction with and delivering about what will be 570,000 sq ft of new space this year, retail space, just FYI. Some of it, yeah, some of it has been completed in the quarter, and it's, yeah, it is related mostly to SmartStop storage completions. So, that's why the number of projects has gone down. In terms of number of projects next year, is that what you were asking?
Yeah, more so just the magnitude of spending. How much do you expect to allocate to development spending next year?
Yeah, I mean, it's going to be partly dictated by the disposition, the dispositions and the timing of that. I think maybe one way to answer that, maybe the useful way to answer that would be, we could probably spend a lot on development for what we have, okay? But we won't. We're talking, for all intents and purposes, we're talking about single-story, pre-leased prototypes. It'll very much be, in a sense, regulated by our metrics. We will hold off on things and delay things until we're where we want to be, and that could include dispositions, or certainly confidence and visibility on dispositions, timing, and so on. There's a lot of potential for us to grow the business, and we'll just do it in a measured way so that everybody's comfortable.
Okay. Last one for me. Just your comments around Park Place. Were any charges taken this quarter, or will there be any charges coming ahead with the project being canceled?
Yeah.
Yeah. Pammi, it's Peter. You may recall in Q2, we did take some IFRS write-downs on the fair market value of some lands, and that included the lands where Park Place is situated. We knew this was a likely outcome. I don't expect any further charges to be taken with respect to that project in particular, other than we did take the charge on the interest expense that we will pay back to purchasers on their deposits this quarter.
Okay. That's great. That's helpful. Thanks very much. I will turn it back.
Thank you. As a reminder, if you would like to queue up to ask a question, please press star one on your phone's keypad. The next question is from Dean Wilkinson from CIBC World Markets. Please go ahead, Dean.
Thanks. Afternoon, everyone. Mitch, I would love to see a Frank Lloyd Wright-designed Walmart. It would be a heck of a building. I guess my question is, it sounds like your propensity or maybe willingness to divest or part ways with some of the non-income-producing or development kind of real estate has potentially increased over the last year or so in favor of doing more of the core. Am I reading that right? And how are you kind of looking at that dynamic as you go forward and kind of go right into your bread-and-butter stuff?
I mean, yes. I mean, you are reading it right, but the stuff that I am referring to there, I mean, it is partly that it is not It is less strategic stuff that, for us, could be very, very good fit for others. And in a sense, you could say we are sort of trading up because that would lower debt and probably result in building one of our new centers. But also, it is partly because prices are a little bit better. The market is a little bit better. There is more buyers. There is more liquidity in the market. So, a year ago, we might have been prepared to part with a number of these properties as well, but there was really no market.
So, it is really the new store program is sort of kind of ramping up, and the market for land and land buyers has picked up. It is not exactly a perfect storm for us, as in good, but it is a lot better than it was, and it is good enough, we think, to start moving some of this less strategic, non-income-producing land out.
Yeah, sometimes good enough is all you need. In terms of the buyer pool, would they tend to be more sort of local, smaller developers, or a small group that is looking at these assets?
You are right. Yep, you are right on. In a lot of these cases, it will be the local regional developer that would love. I mean, I used to be that guy. I remember doing very, very well buying lands from larger landlords, land developers. Yeah, that is probably who will be the most interested in some of this stuff. Yep.
Okay, perfect. That is helpful. Thanks, Mitch. Talk to you later.
Thank you.
All right, thank you. There are no further questions in the queue.
All right. Well, thank you for participating in our Q3 call. Please feel free to reach out to any of us if you have any further questions. Have a great rest of your day. Thanks.
Ladies and gentlemen, this concludes the SmartCentres REIT Q3 2026 conference call. Thank you for your participation, and have a nice day.