May 20, 2010 / 9:11 PM / 8 years ago

UPDATE 1-RioCan to buy eight retail properties in Texas

* To assume debt of $85.6 mln

* Says will buy on an 80-20 joint venture basis

May 20 (Reuters) - Canada’s RioCan Real Estate Investment Trust (REI_u.TO) said it agreed with U.S.-based Inland Western Retail Real Estate Trust Inc to purchase eight retail properties in Texas for about $53 million.

RioCan said through its unit RioCan Holdings USA Inc, it will acquire on an 80-20 joint venture basis a portfolio of eight retail properties with Inland Western.

The total consideration to be paid by RioCan is about $138 million, including the assumption of $85.6 million of property level mortgage debt on the portfolio, the company said in a statement.

RioCan said the properties are located in three major markets within Texas — Dallas-Fort Worth, Houston, and Austin.

In February, RioCan said it had earmarked at least C$500 million to spend this year on acquisitions, with an eye trained on the U.S. market, which it entered last year. [ID:nN09103382]

“This acquisition is an opportunity to further RioCan’s investment strategy to acquire high quality defensive assets in large and growing urban markets,” Chief Executive Edward Sonshine said in a statement.

RioCan said two of the largest tenants in the portfolio are grocery tenants HEB — one of the largest grocers in Texas — and Tom Thumb, owned by Safeway Inc SWY.N.

RioCan shares closed at C$18.21 Thursday on the Toronto Stock Exchange. (Reporting by Isheeta Sanghi in Bangalore; Editing by Maju Samuel) ((; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging:

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