Real Estate — March 17, 2009

Cominar REIT - 10 Consecutive Years of Growth

    
    TSX - CUF.UN

    - Increases of 29.4% in operating revenues and 28.1% in net operating
      income
    - Distributable income of $74.0 million, up 17.1%
    - Funds from operations of $85.8 million, up 18.7%
    - Acquisitions of income properties totaling $213.6 million in 2008
    - $255.0 million credit facility maturing in 2009 renewed until June 2010

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    QUEBEC CITY, March 17 /CNW Telbec/ - Cominar Real Estate Investment Trust
("Cominar" or the "REIT") announces excellent results for its fourth quarter
and fiscal year ended December 31, 2008.

    
    Financial Highlights
    --------------------
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    For the periods           Quarter                Cumulative (12 months)
    ended December 31,
    (in thousands
    of dollars
    except per                               %                             %
    unit amounts)     2008      2007    Change      2008      2007    Change
    -------------------------------------------------------------------------
    Operating
     revenues(1)    62,356    53,219      17.2   235,341   181,870      29.4
    Net operating
     income(1)(2)   38,570    32,333      19.3   140,469   109,619      28.1
    Net income       6,323     6,359      (0.6)   25,034    29,241     (14.4)
    Distributable
     income(2)      19,741    17,886      10.4    74,038    63,237      17.1
    Recurring
     distributable
     income(2)      19,741    17,886      10.4    74,038    62,815(3)   17.9
    Recurring
     funds from
     operations(2)  22,900    20,396      12.3    85,840    72,288(3)   18.7
    Recurring
     adjusted
     funds from
     operations(2)  19,764    17,929      10.2    74,128    62,858(3)   17.9
    Distributions   16,774    16,230       3.4    64,737    55,454      16.7
    Per unit
     (fully diluted)
    Recurring
     distributable
     income(2)        0.42      0.39       7.7      1.59      1.48(3)    7.4
    Recurring
     funds from
     operations(2)    0.48      0.43      11.6      1.80      1.68(3)    7.1
    Recurring
     adjusted
     funds from
     operations(2)    0.42      0.39       7.7      1.59      1.48(3)    7.4
    Distributions
     (basic)         0.365     0.358       2.0     1.417     1.301       8.9
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    (1) Certain figures for fiscal 2007 have been reclassified as
        discontinued operations in conformity with GAAP.
    (2) See the note "Non-GAAP Financial Measures".
    (3) Excluding non-recurring interest income of $0.4 million realized
        during the second quarter of 2007 in connection with a public
        offering of subscription receipts.
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    "We are very pleased with our 2008 financial results; we achieved
continued growth in our markets despite the general economic turmoil and
credit crisis. Our fundamentals remain very solid, as reflected by our stable
occupancy rate of 94.6%, our ability to renew and arrange financings, and our
conservative interest coverage ratio of 2.7:1. Cominar is well positioned to
maintain a sound financial performance through an economic downturn, given its
quality real estate portfolio, solid and well-diversified tenant base,
disciplined cost management, healthy financial position and growth potential,"
indicated Michel Dallaire, President and Chief Executive Officer of Cominar.

    Operating revenues totaled $235.3 million for the fiscal year ended
December 31, 2008, up 29.4%. This significant increase is due mainly to the
contribution of the acquisitions completed and integrated in 2007 and 2008.

    Net operating income ("NOI") amounted to $140.5 million, up 28.1% over
2007, whereas the operating profit margin as a percentage of operating
revenues stood at 59.7%, similar to that of 2007.

    Net income amounted to $25.0 million for fiscal 2008, down 14.4% from the
previous year. This decrease is due mainly to the significant increase in
depreciation of income properties attributable to the acquisitions and
developments completed in 2007 and 2008.

    Distributable income ("DI") totaled $74.0 million for fiscal 2008, up
17.1% over the previous year. RDI per fully diluted unit amounted to $1.59,
compared with $1.48 in 2007, an increase of 7.4%.

    Funds from operations ("FFO") totaled $85.8 million, up 18.1% due to the
contribution of the acquisitions and developments completed in 2007 and 2008
as well as the strong 3.7% organic growth in net operating income. Recurring
FFO per fully diluted unit amounted to $1.80, compared with $1.68 in 2007, up
7.1%.

    Adjusted funds from operations ("AFFO") totaled $74.1 million, compared
with $63.3 million for 2007. Recurring AFFO per fully diluted unit increased
by 7.4%.

    Cominar paid distributions totaling $64.7 million to unitholders in 2008,
compared with $55.5 million in 2007, an increase of 16.7%. Distributions per
unit amounted to $1.417, up from $1.301 in 2007.
    "Fiscal 2008 was the 10th anniversary of Cominar's listing on the stock
market and also represented our 10th consecutive year of growth. The many
acquisitions and developments completed over the past decade have raised the
gross book value from $244.6 million to $1.8 billion. Combined with strong
organic growth, this expansion-by-acquisition has contributed to the increases
of 360% in distributable income and 325% in distributions over 1999. These 10
years of growth have provided the REIT with the solidity and stability to
weather difficult economic conditions and continue meeting our commitments to
unitholders," indicated Michel Dallaire, President and Chief Executive Officer
of Cominar.

    Financial Position
    ------------------

    As at December 31, 2008, Cominar maintained a debt ratio of 61.9%, which
is less than the maximum debt ratio of 65.0% allowed by its Contract of Trust
when convertible debentures are outstanding. Its interest coverage ratio was
conservative at 2.7:1 and the weighted average contractual interest rate of
its long-term debt was 5.63%, down 16 basis points from December 31, 2007.
Furthermore, all mortgages payable and bank indebtedness maturing in 2009 have
already been renewed.

    Fourth-Quarter Results
    ----------------------

    For the fourth quarter ended December 31, 2008, operating revenues
totalled $62.4 million, up from $53.2 million for the comparable period of
2007. This strong increase of 17.2% reflects the contribution of the completed
acquisitions and developments as well as excellent organic growth. NOI grew
19.3% to $38.6 million. DI amounted to $19.7 million, compared with $17.9
million for the corresponding period of 2007, an increase of 10.4%. DI per
fully diluted unit for the fourth quarter of 2008 grew 7.7% to $0.42.
    AFFO was up 10.2% over the fourth quarter of 2007. AFFO per fully diluted
unit grew 7.7% to $0.42.

    Operational Highlights
    ----------------------

    Cominar consistently strives to maximize its property occupancy rates and
has successfully maintained an average of approximately 95.0% since its
inception. As at December 31, 2008, its portfolio occupancy rate stood at
94.6%. Leasing activities continued to progress across its portfolio in 2008,
especially in the retail sector where 96.1% of expiring leases were renewed.
The leasing team redoubled its efforts to renew 77.1% of all expiring leases
in 2008, with an average increase of 7.9%, thereby achieving a good
performance. In addition, Cominar signed new leases representing an area of
more than one million square feet.

    Acquisitions and Developments Completed in 2008
    -----------------------------------------------

    In 2008, Cominar acquired 12 income properties representing a total
investment of $213.6 million, including a 24-storey Class "A" office tower
located at 2001 McGill College in Montreal for a consideration of $165
million. In addition, the REIT has completed the development of two industrial
and mixed-use properties in the Montreal area for $10.8 million.

    Ongoing Developments
    --------------------

    Ongoing developments in the Quebec City and Montreal regions represent an
additional leasable area of approximately 0.7 million square feet and a total
estimated investment of approximately $97.4 million. Their average
capitalization rate is estimated at 9.4%, which is much higher than current
market rates for similar properties. Given the climate of uncertainty,
Cominar's management has decided to postpone all upcoming developments for the
moment, including Phase 2 of the Laurier project in Quebec City.

    Distribution Reinvestment Plan
    ------------------------------

    The REIT has a distribution reinvestment plan for its unitholders that
allows participants to reinvest their monthly distributions in additional
Trust units. Participants will be given the right to receive an effective
discount of 5% of distributions to which they are entitled in the form of
additional units. Additional information and enrolment forms are available at
www.cominar.com.

    Additional Financial Information
    --------------------------------

    Cominar's consolidated financial statements and the management's
discussion and analysis for the fiscal year ended December 31, 2008 will be
filed with SEDAR at www.sedar.com and are available on Cominar's website at
www.cominar.com.

    March 17, 2009 Conference Call
    ------------------------------

    On Tuesday, March 17, 2009, at 11:00 a.m. (EDT), Cominar's management
will hold a conference call to discuss the results for fiscal 2008. Anyone who
is interested may take part in this call by dialing 1-800-733-7571. A
presentation of the 2008 results will be available before the conference call
on the REIT's website at www.cominar.com under the title "Conference Call".
The event will also be simultaneously webcast on its website and archived for
90 days.

    PROFILE as at March 17, 2009
    ----------------------------

    Cominar is the largest commercial property owner in the Province of
Quebec. The REIT owns a real estate portfolio of 215 high-quality properties,
consisting of 38 office, 38 retail and 139 industrial and mixed-use buildings
that cover a total area of over 18.5 million square feet in the Greater Quebec
City, Montreal and Ottawa areas. Cominar's objectives are to deliver growing
cash distributions to its unitholders and to maximize unitholder value through
proactive management and the growth of its portfolio.

    Forward-Looking Statements and Non-GAAP Financial Measures
    ----------------------------------------------------------

    This press release may contain forward-looking statements with respect to
Cominar and its operations, strategy, financial performance and financial
condition. These statements generally can be identified by the use of
forward-looking words such as "may", "will", "expect", "estimate",
"anticipate", "intend", "believe" or "continue" or the negative thereof or
similar variations. The actual results and performance of Cominar discussed
herein could differ materially from those expressed or implied by such
statements. Such statements are qualified in their entirety by the inherent
risks and uncertainties surrounding future expectations. Some important
factors that could cause actual results to differ materially from expectations
include, among other things, general economic and market factors, competition,
changes in government regulation and the factors described under "Risk
Factors" in the Annual Information Form of Cominar. The cautionary statements
qualify all forward-looking statements attributable to Cominar and persons
acting on its behalf. Unless otherwise stated, all forward-looking statements
speak only as of the date of this press release.
    Net operating income ("NOI"), distributable income ("DI"), funds from
operations ("FFO") and adjusted funds from operations ("AFFO") are not
measures recognized under Canadian generally accepted accounting principles
("GAAP") and do not have standardized meanings prescribed by GAAP. NOI, DI,
FFO and AFFO computed by Cominar may differ from similar computations as
reported by other similar organizations and, accordingly, may not be
comparable to similar measures reported by such organizations.

    Complete consolidated financial statements, including accompanying notes,
are available on Cominar's website at www.cominar.com under "Investor
Relations - Quarterly Reports".

    
    Consolidated Balance Sheets
    As at December 31,
    (in thousands of dollars)
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                                                          2008          2007
                                                             $             $
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    ASSETS
    Income properties
      Buildings                                      1,228,214     1,073,830
      Land                                             199,211       174,657
      Intangible assets                                 79,106        74,608
                                                  ------------  -------------
                                                     1,506,531     1,323,095

    Properties under development                        72,945        31,401
    Land held for future development                    20,857        29,879
    Deferred expenses and other assets                  45,111        36,001
    Prepaid expenses                                     1,954         2,758
    Accounts receivable                                 21,352        19,660
    -------------------------------------------------------------------------
                                                     1,668,750     1,442,794
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    LIABILITIES
    Mortgages payable                                  730,711       619,755
    Convertible debentures                             203,723       203,852
    Bank indebtedness                                  186,987        35,321
    Accounts payable and accrued liabilities            34,987        35,924
    Distributions payable to unitholders                     -         6,246
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                                                     1,156,408       901,098
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    UNITHOLDERS' EQUITY
    Unitholders' equity                                512,342       541,696
    -------------------------------------------------------------------------
                                                     1,668,750     1,442,794
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    Approved by the Board of Trustees

    Robert Després                          Michel Dallaire
    Chairman of the Board of Trustees       Trustee


    Consolidated Statements of Unitholders' Equity
    For the years ended December 31,
    (in thousands of dollars)
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                                                          2008          2007
                                                             $             $
    -------------------------------------------------------------------------

    Unitholders' contributions
    Balance, beginning of year                         591,172       400,698
    Issue of units                                       9,793       196,378
    Underwriters' fees and offering expenses                 -        (5,904)
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    Balance, end of year                               600,965       591,172
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    Cumulative net income
    Balance, beginning of year                         247,779       218,538
    Net income                                          25,034        29,241
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    Balance, end of year                               272,813       247,779
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    Cumulative distributions
    Balance, beginning of year                        (298,080)     (242,626)
    Distributions to unitholders                       (64,737)      (55,454)
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    Balance, end of year                              (362,817)     (298,080)
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    Contributed surplus
    Balance, beginning of year                             513           398
    Unit option plan                                       556           115
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    Balance, end of year                                 1,069           513
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    Other equity component
    Equity component of convertible debentures             312           312
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    Total unitholders' equity                          512,342       541,696
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    Consolidated Statements of Income and Comprehensive Income
    For the years ended December 31,
    (in thousands of dollars except per unit amounts)
    -------------------------------------------------------------------------
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                                                          2008          2007
                                                             $             $
    -------------------------------------------------------------------------

    Operating revenues
    Rental revenue from income properties              235,341       181,870
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    Operating expenses
    Operating costs                                     44,333        35,076
    Realty taxes and services                           47,924        35,429
    Property management expenses                         2,615         1,746
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                                                        94,872        72,251
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    Operating income before the undernoted             140,469       109,619
    -------------------------------------------------------------------------
    Interest on borrowings                              50,798        35,591
    Depreciation of income properties                   51,833        35,470
    Amortization of deferred leasing costs               8,231         6,952
    Amortization of other assets                           330           196
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                                                       111,192        78,209
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    Operating income from real estate assets            29,277        31,410
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    Trust administrative expenses                       (4,186)       (2,954)
    Other revenues                                         289           394
    Unusual item                                             -           422
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    Net income from continuing operations               25,380        29,272
    Net loss from discontinued operations                 (346)          (31)
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    Net income and comprehensive income                 25,034        29,241
    -------------------------------------------------------------------------
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    Basic net income per unit                            0.550         0.703
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    Diluted net income per unit                          0.545         0.693
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    Consolidated Statements of Cash Flows
    For the years ended December 31,
    (in thousands of dollars)
    -------------------------------------------------------------------------
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                                                          2008          2007
                                                             $             $
    -------------------------------------------------------------------------

    OPERATING ACTIVITIES
    Net income                                          25,034        29,241
    Items not affecting cash:
    Depreciation of income properties                   51,871        36,132
    Amortization of below-market leases                   (576)         (250)
    Amortization of deferred leasing costs               8,243         6,965
    Amortization of deferred financing costs and
     other assets                                        2,197         1,302
    Amortization of fair value adjustments on assumed
     indebtedness                                         (127)          (52)
    Accretion of liability component of convertible
     debentures                                             37             9
    Compensation expense related to unit option plan       652           217
    Loss on disposal of an income property                 368             -
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                                                        87,699        73,564
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    Change in non-cash operating working capital items  (1,775)       10,842
    -------------------------------------------------------------------------
                                                        85,924        84,406
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
    Acquisitions of income properties                 (233,409)     (418,382)
    Additions to properties under development and
     land held for future development                  (33,612)      (47,863)
    Net proceeds on disposal of an income property       2,044             -
    Compensation on disposal of an income property           -        30,000
    Leasing costs                                      (17,495)       (9,746)
    Other assets                                        (1,986)       (1,281)
    -------------------------------------------------------------------------
                                                      (284,458)     (447,272)
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
    Mortgages payable                                  257,520       167,987
    Repayment of mortgages payable                    (147,882)      (67,389)
    Net proceeds from issue of convertible
     debentures                                              -       182,720
    Bank indebtedness                                  151,666       (38,394)
    Net proceeds from issue of units                     5,027       169,454
    Distributions to unitholders                       (67,797)      (51,512)
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                                                       198,534       362,866
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    Net change in cash and cash equivalents                  -             -
    Cash and cash equivalents, beginning of year             -             -
    -------------------------------------------------------------------------
    Cash and cash equivalents, end of year                   -             -
    -------------------------------------------------------------------------
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    %SEDAR: 00010204EF

For further information: Michel Dallaire, P.Eng., President and Chief
Executive Officer, (418) 681-8151, mdallaire@cominar.com; Michel Berthelot,
CA, Executive Vice President and Chief Financial Officer, (418) 681-8151,
mberthelot@cominar.com

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