EL7.AI
StocksMedium•10 November 2026•
4 min read

Crombie to Reacquire 89% Stakes in 15 Properties, Fund Deals With $117 Million Offering

Key Facts

1Crombie expects gross proceeds of approximately $117 million from the sale of 7,312,500 units at $16.00 per unit.
2Crombie is buying the remaining 89% interest in 15 properties for $216.2 million, while assuming approximately $56 million of mortgage debt.
3An Empire subsidiary agreed to buy partnership units for approximately $83 million; Empire will retain an interest of approximately 41.5% after the financing closes.
4The acquisitions together add approximately 1.2 million square feet, for a total purchase price of approximately $350 million and an estimated blended initial capitalization rate of approximately 6.0%.
5After both deals are completed, Crombie expects a portfolio of 324 properties totaling approximately 20.7 million square feet, with committed occupancy of approximately 97.9%.

On November 9, 2026, Crombie announced an underwritten offering of 7,312,500 trust units at $16.00 per unit, for expected gross proceeds of approximately $117 million. The announcement coincided with an agreement to buy the remaining 89% interest in 15 retail properties, alongside another acquisition in Ontario. The combined purchase price for the two acquisitions is approximately $350 million before closing and transaction costs, and together they are expected to add approximately 1.2 million square feet to the REIT's interest. Net proceeds from the financing will not be used solely for the purchases; Crombie also intends to use them to repay debt, including amounts owed under its revolving credit facility, and for general REIT purposes. The company said the unit offering is not conditional on either acquisition closing.

Alongside the offering, a wholly owned subsidiary of Empire agreed to buy limited partnership units for approximately $83 million. After the financing closes, Empire is expected to retain an economic and voting interest of approximately 41.5% in Crombie. The offering and private placement are expected to close concurrently on or about November 18, 2026, with each closing conditional on the other. Closing is subject to customary conditions and regulatory approvals, including approval from the Toronto Stock Exchange. Crombie also expects to make a prospectus supplement available through SEDAR+ on November 12, 2026.

The larger transaction by asset description involves buying the remaining 89% interest in 15 existing necessity-based retail properties anchored by Empire-branded grocery stores, for $216.2 million before closing and transaction costs. The price includes assuming approximately $56 million of existing mortgage debt. The portfolio has approximately 721,000 square feet of gross leasable area, including Crombie's current interest; the acquisition will add approximately 641,000 square feet to the REIT's interest. At closing, Crombie will own the properties outright. The transaction is scheduled to close in late fourth-quarter 2026 or early first-quarter 2027, subject to closing conditions, including approval under Canada's Competition Act.

The deal restores ownership of assets Crombie had acquired between 2008 and 2014 before selling an 89% interest in them in 2019. The company continued to manage and operate the properties after the sale, and the current purchase is being made under the right of first offer set out in the partnership agreement. Crombie says the portfolio is fully occupied and anchored by Safeway, Sobeys, FreshCo and IGA Extra stores. Approximately 98% of its annual minimum rent comes from Empire, while its weighted average lease term is approximately 15.9 years. These long-term leases provide an operating framework for the assets that will transfer to the REIT's full ownership upon completion of the transaction.

The Ontario agreement, announced on October 13 and 22, 2026, covers the purchase of an entire portfolio of 13 retail properties totaling approximately 588,000 square feet, for approximately $134 million before closing and transaction costs. The agreement includes 9 properties anchored by Sobeys, 2 by Walmart and 2 by Shoppers Drug Mart. The portfolio was fully occupied, according to Crombie's statement, and approximately 60% of its annual minimum rent comes from Empire. Its weighted average lease term is approximately 4.6 years, shorter than that of the 15-property portfolio. The Ontario deal is scheduled to close in November 2026.

Crombie expects the acquisitions together to raise the blended initial capitalization rate to approximately 6.0% and add approximately 1.2 million square feet to its interest for a total purchase price of approximately $350 million before closing and transaction costs. After both deals are completed, the company expects its portfolio to comprise 324 properties totaling approximately 20.7 million square feet. It also expects committed occupancy of approximately 97.9% and a weighted average lease term of approximately 7.9 years. These figures depend on completion of the acquisitions, at least one of which is subject to approvals and closing conditions. The announcement follows third-quarter results Crombie published on November 4, 2026.

In its third-quarter results, Crombie said rent growth on renewals was 13.9% above expiring rates, the strongest in more than five years, and committed occupancy reached 97.7%. Cash net operating income for comparable commercial properties also grew 2.7% compared with the third quarter of 2025. Property revenue rose 6.2% to C$127.586 million, from C$120.084 million in the corresponding period of 2025. Chief Executive Mark Holly said rent growth on renewals "was the strongest in more than five years" and committed occupancy "matched the company's record level." The company said its focus is on growing cash flows and maximizing long-term value for unitholders.