Landlords might be game for Toy “R” Us real estate but it probably won’t affect the Canadian market

The chief executive of Canada’s largest real estate investment trust says he’d have no problem filling any space vacated by Toys “R” Us, but he doubts it will reach the market.

Ed Sonshine, whose RioCan REIT counts the retailer as a tenant in two of its facilities, said Tuesday there would be strong demand for the space because of the prime locations – a feeling echoed by others in the real estate community who say the Toys “R” Us footprint in Canada is much different than in the United States.

“We only have two of them, one of them in the Yonge and Eglinton Centre and, if they want to go, they can go,” said Sonshine, referring to the location at its head office in midtown Toronto. The retailer has another location at a RioCan property in Ottawa. “They are a very tiny tenant for us. My understanding, our head of leasing has spoken to them today, is that Canada is doing great and they have no intention of closing any stores here.”

Toys “R” Us Canada initiated bankruptcy proceedings in an Ontario court Tuesday, a day after it filed for creditor protection in the U.S.

Sonshine sees the bankruptcy as more akin to what happened to Payless ShoeSource when it filed for protection this year. “Payless went into Chapter 11, CCAA, and they never closed any stores in Canada. They sort of used it to deal with their debt in a sensible way and close a bunch of non-performing stores.”

Avi Behar, chief executive of the Behar Group Inc. which worked to bring the first Toys “R” Us into Canada in the 1980s, said the chain’s locations are much different than Target’s spots.

“They just have great locations. Their rollout into Canada was very strategic at the time and a real winner,” said Behar, whose company is trying to track the variations in size of the retailer’s locations. “There are some bigger ones and smaller ones out there. The bigger ones have a Babies “R” Us in them.”

The bigger stores at 40,000 square feet might work for some, but as retailers continue to downsize models, the stores might have to be divided up, Behar said.

“In some of the more urban locations, the landlord might want the space back. Once you get into the outskirts, it’s a lot more challenging to backfill. Market rates over the past 10-15 years have been pretty good but things are changing in retail,” he said.

Location, location

Ross Moore, a senior vice-president with real estate company Cresa, said some of the chain’s locations may have rents below market prices, but it will be nothing like the situation with older retailers such as Sears.

“The leases could have some value, but are far from straightforward. Keep in mind, any assignment would require the landlord’s permission and then you get into co-tenancy agreements etc.,” said Moore.

Either way, the impact on Canada’s publicly traded real estate companies will be negligible, said Neil Downey, managing director and real estate analyst with RBC Capital Markets.

“Canadian REIT exposure seems quite low,” said Downey, noting Smart Centres probably has a the biggest exposure to Toys “R” Us and the retailer is its 19th largest tenant and accounts for only 0.9 per cent of revenue. “Plaza Retail REIT, Crombie REIT, Choice Properties and CT REIT do not disclose top 10 (retailers), and we suspect that any exposure would be well below a top 20 tenant, if an‎y.”

In addition to RioCan, another industry heavyweight, First Capital, doesn’t even count Toys “R” Us as a top 20 tenant.

gmarr@postmedia.com
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Procreate 4 for iPad Offers New Painting Engine, Layer Masks, Drag and Drop, and More

Popular iPad painting and sketching app Procreate was today updated to version 4, offering an overhauled experience that provides improvements to the app’s core elements and introduces support for iOS 11.

Procreate 4 adopts support for Metal 2, Swift 4, and Core Video, introducing a new Silica M painting engine that’s been engineered with better color depth, more fluid and accurate painting, and faster performance.



A new brush engine and interface allows for new effects and settings, and there’s a new, faster smudge tool for smudging and mixing paint along with a new wet painting experience. Blending colors in Procreate 4 is 250 times more accurate than in the previous-generation Procreate app.



Layer Masks have been added in Procreate 4 for non-destructive image modifications, and there are new Brush Blend Modes, with support for applying existing blend modes to any brush.

When using the Apple Pencil, there’s a new Bleed setting, and the Tilt and Sketching brushes available with the accessory offer better realism and responsiveness.

With Drag and Drop support, multiple paintings can be dragged out of the app into another for sharing, and brushes and palettes can be dragged in. Layers can be dragged as individual images, and images taken directly from the web browser can be quickly dragged into Procreate for faster editing.



Other improvements include P3 Wide Color support, a new color interface to make it easier to switch between colors, a new interface for image adjustments, and a new gallery for managing artwork and interacting with the Files app.

Procreate 4 can be downloaded from the App Store for $9.99. [Direct Link]

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Cyber attack, hurricane weigh on FedEx quarterly profit

(Reuters) – Package delivery company FedEx Corp said on Tuesday a June cyber attack on its Dutch unit slashed $300 million from its quarterly profit, and the company lowered its full-year earnings forecast.

Dozens dead as major earthquake strikes near Mexico City

MEXICO CITY (Reuters) – A major earthquake of magnitude 7.1 struck central Mexico on Tuesday, killing at least 60 people in several states, toppling buildings in the heavily populated capital and forcing thousands of people into the streets in panic.

Dozens dead as major earthquake strikes near Mexico City

MEXICO CITY (Reuters) – A major earthquake of magnitude 7.1 struck central Mexico on Tuesday, killing at least 60 people in several states, toppling buildings in the heavily populated capital and forcing thousands of people into the streets in panic.

Myanmar’s Suu Kyi condemns abuses in Rakhine but silent on army role

NAYPYITAW, Myanmar/UNITED NATIONS (Reuters) – Myanmar leader Aung San Suu Kyi on Tuesday condemned rights violations in Rakhine state and said violators would be punished, but she did not address U.N. accusations of ethnic cleansing, drawing cool international responses and calls for action to help minority Muslims.

Wall Street edges higher; U.S. Fed meeting in focus

(Reuters) – The three major U.S. stock indexes edged higher on Tuesday, logging closing records, with financial stocks providing the biggest boost a day ahead of the Federal Reserve’s concluding statement from its two-day policy meeting.

Cellular Over-the-Air App Download Limit Increased to 150 MB

Following the launch of iOS 11, Apple today announced that it has increased the cellular over-the-air app download limit from 100 MB to 150 MB, meaning users can now download apps and app updates that are as large as 150 MB over a cellular connection.

Apps and app updates over 150 MB will require users to connect to Wi-Fi for content to be downloaded.

It’s been awhile since Apple last updated the cellular download limit. The last increase was introduced in 2013, increasing the 50 MB limit to 100 MB.

Apple has limits in place to avoid causing customers to unwittingly use high amounts of data when downloading apps, but the introduction of unlimited plans from all of the major carriers in the United States has likely alleviated some of those concerns.

Developers often aim to keep their app sizes under the cellular limit whenever possible to prevent customers from having to hassle with connecting to Wi-Fi to download an app or app update.

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