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Alberta & Prairies  + Pacific Canada  + Finance  | 
Firm Capital wants Melcor Developments to take its REIT private.

Melcor to Focus Investments on Alberta

Melcor REIT has decided to focus its investments on Alberta while conducting an ongoing strategic review.

The REIT said in its quarterly report that it has listed its Saskatchewan assets, a remaining Kelowna, B.C., property (after selling the Kelowna Business Centre in 2023 for $19.5 million) and a Lethbridge, Alta., building.

“We have seen interest on these asset listings, and sales efforts continue,” said Melcor CEO Andrew Melton.

The Alberta focus and sale efforts are designed to create additional liquidity for future opportunities and enable Melcor to concentrate on remaining assets and financial resilience.

Edmonton-based Melcor launched the strategic review in February to enhance unit value and improve the REIT’s financial position while also suspending its dividend. Melcor is grappling with escalating finance costs, the ongoing impact of inflation on operating and leasing expenses, and reduced property valuations.

In 2023, asset revaluations resulted in fair-value losses of $16.79 million, following a $12-million decline in 2022.

As of February 2024, Melcor’s portfolio contained 38 retail, office and industrial assets in Alberta, Saskatchewan and B.C.

Pictured: Melcor retail property in northwest Calgary

Photo: Melcor REIT

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About Monte Stewart

Monte Stewart serves as Content Director - Canada for Connect Commercial Real Estate. Based in Vancouver, British Columbia, Monte provides daily news coverage of major Canadian commercial real estate markets, including Vancouver, Toronto, Montreal and Calgary. He has written about the real estate sector for various media outlets and Avison Young since the early 2000s. In addition, he has covered sports, general news and business for several leading wire services and publications, including The Canadian Press, The Associated Press, The Calgary Herald, The Globe and Mail, Research Money, The Daily Oil Bulletin, Natural Gas World and The Toronto Star. Monte is active in his community as a youth basketball coach and raises funds for such charitable causes as Movember.

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