SmartCentres: A 6.75% Dividend Yield With Walmart As Anchor Tenant

SmartCentres trades near NAV, with a fair value per unit of C$35 and current price reflecting a higher discount rate scenario. SRU.UN's AFFO covers its 6.75% yield, with surplus supporting development; recent lease renewals show positive spreads, notably 12% excluding anchor tenants. Refinancing C$550M unsecured debt in 2027 at higher rates will raise annual interest cost by C$5.5–6M, but maturities are well-staggered. Anchor tenants like Walmart, Canadian Tire, and Loblaws drive stability, representing over 30% of gross rental revenue and supporting a reasonable 13.5x AFFO valuation.

SmartCentres Real Estate Investment Trust ( CWYUF ) ( SRU.UN:CA ) is one of Canada’s largest REITs with almost C$11B in directly owned properties on a C$12.1B balance sheet. The fair value per unit is