Somewhere in the long human habit of building places where people buy their groceries and fill their prescriptions, a Canadian real estate trust called Crombie has spent years assembling nearly three hundred properties across ten provinces. In February 2021, a Motley Fool Canada writer held it up as a candidate for the country's best dividend stocks, pointing to a development plan that would reshape its holdings over a decade or more. The case is an argument rather than a verdict, resting on projections that the years ahead have yet to test.
Motley Fool Pitches Crombie REIT as Canada's Best Dividend Stock on Development Pipeline
A 0.37% yield under a dividend-stock headline
Mark
Start with the basics. What is Crombie, and why is anyone calling it a top dividend stock?
Mimi
It's a national retail landlord with 285 properties in 10 provinces, about 17.6 million square feet, mostly grocery and drugstore-anchored centres. The piece says it has grown through balanced capital allocation and a lower cost of capital over time.
Luke
Before we go further, the article cites a dividend yield of 0.37%. That's strange for a headline about dividends. Whether that figure is right or a data error, the piece doesn't explain it.
Mark
So the headline and the numbers don't obviously line up?
Luke
Not on the page, no. A reader should check the yield independently before leaning on the dividend claim.
Mimi
The real argument is development. Crombie has 33 major development properties in its pipeline, with a horizon of a decade or longer, and each project has incremental costs above $50 million.
Mark
What do those properties earn now, while they wait?
Mimi
About a 5.5% net operating income yield on existing asset cost, in aggregate. The idea is they pay while approvals and entitlements are worked through.
Luke
That's the company's figure, relayed by the author. And words like 'well positioned' and 'expected to capitalize' are projections, not results.
Mark
How does it make money from the redevelopment itself?
Mimi
Mixed-use projects with grocery-anchored retail and rental housing, sometimes condos. It can also sell air rights or finished rental properties to third parties.
Luke
Worth remembering this is opinion from a stock-promotion outlet. There's no independent analysis here, and no timeline for when any of this lands.
Le Pouls
- A stock recommendation arrives with a headline promising income, yet the yield it cites is strikingly small.
- Crombie is betting its future on 33 major mixed-use developments, a pipeline that could stretch across a decade or longer.
- Management is trying to turn grocery-anchored shopping centres into homes, rentals, and condominiums, and to sell air rights or rental buildings once projects are finished.
- The payoff depends on whether net asset value actually grows, and the piece offers no independent proof that it will.
Somewhere in the long human habit of building places where people buy their groceries and fill their prescriptions, a Canadian real estate trust called Crombie has spent years assembling nearly three hundred properties across ten provinces. In February 2021, a Motley Fool Canada writer held it up as a candidate for the country's best dividend stocks, pointing to a development plan that would reshape its holdings over a decade or more. The case is an argument rather than a verdict, resting on projections that the years ahead have yet to test.
Crombie Real Estate Investment Trust, listed in Toronto as CRR.UN, owns interests in 285 properties spread across ten Canadian provinces, together covering roughly 17.6 million square feet. Most are shopping centres anchored by grocery stores and drugstores, along with freestanding stores and some mixed-use sites in busy urban and suburban markets. On February 14, 2021, a Motley Fool Canada opinion piece argued that the company deserved a place among the country's best dividend stocks.
The article's valuation figures tell a mixed story. It cites a price-to-earnings ratio of 23.76, a price-to-book ratio of 1.52, and a market value of about $2.28 billion, along with a dividend yield of just 0.37%. That yield sits awkwardly beside the dividend-stock framing and deserves a check against the company's actual distributions. The piece also describes modest borrowing and reports an operating margin and return on equity, though these are the writer's assessment, not independently verified.
At the heart of the argument is development. Crombie has been shifting from simply owning retail space toward large mixed-use projects, focusing on ones where incremental costs exceed $50 million and where commercial and residential uses might share a site. The aim is to widen the gap between the yields those projects earn and the capitalization rates paid for acquisitions, lifting net asset value along the way. Meanwhile, the existing properties keep producing income, with the pipeline currently earning a net operating income yield of about 5.5% on its existing cost.
The company plans to carry out these projects alone or with partners, favouring grocery-anchored retail and purpose-built rental housing, and sometimes condominiums where municipalities require them. Once built, it can sell air rights or completed rental buildings to third parties. The writer presents this flexibility as a route to shareholder value and as a response to urban intensification.
What remains open is whether the 33-property pipeline becomes the net asset value growth promised, and how a dividend yield of 0.37% fits with the income case in the headline.
Crombie Real Estate Investment Trust, which trades on the Toronto Stock Exchange as CRR.UN, owns interests in 285 investment properties spread across 10 Canadian provinces. Together they come to about 17.6 million square feet of gross leaseable area. A Motley Fool Canada opinion piece published on February 14, 2021, argues the company deserves a place among the country's best dividend stocks.
The core of the business is retail property. Crombie describes itself as one of Canada's leading national retail landlords, with a portfolio of grocery and drugstore-anchored shopping centres, freestanding stores, and mixed-use developments, mostly in top urban and suburban markets. The piece says the company has grown through balanced capital allocation and a falling cost of capital over time.
The article gives a set of valuation figures. Crombie has a price-to-earnings ratio of 23.76, a price-to-book ratio of 1.52, and a market capitalization of $2.28 billion. It cites a dividend yield of 0.37%, a number that sits oddly beside the dividend-stock headline and is worth checking against the company's own distributions. The piece also says debt is used sparingly, pointing to a debt-to-equity ratio of 1.58. It adds an operating margin of 42.52% and a return on equity of 6.31%.
Most of the argument rests on development. Crombie's business has evolved from owning and operating grocery and drugstore-anchored retail to include major mixed-use real estate development. The company is focused on projects where incremental development costs exceed $50 million and where the plans may combine commercial and residential uses. The stated aim is to grow net asset value by maximizing the spread between development yields and the capitalization rates paid for acquisitions. The piece links this to urban intensification, which it calls an important reality across the country.
The pipeline is specific: 33 major development properties, which the article says could be worked through over a decade or longer. In the meantime, these properties generate income while approvals, entitlements, and advance preparations are completed. In aggregate, Crombie currently earns a net operating income yield of roughly 5.5% on the existing asset cost of those pipeline properties.
The article describes how projects would be carried out. Developments are planned and executed either alone or with partners, with an emphasis on grocery-anchored retail and purpose-built residential rental accommodation. Residential condominium uses are also considered, in part to satisfy municipal requirements and market opportunities. Crombie can monetize the density value by selling air rights, or purpose-built rental properties, to third parties after development. The article presents this range of options as a way to enhance shareholder value, and says adding residential and retail-related industrial real estate would improve portfolio quality and income growth.
This is an opinion piece promoting a stock, and its claims are the author's assessment rather than independent verification. The article also credits the company with a strong and diverse workforce aligned with its brand and values, without offering figures to back that up. What the reader can track is whether the 33-property pipeline turns into the net asset value growth the piece anticipates, and how the sharply low dividend yield it cites squares with the income case in its headline.
Citations marquantes
Crombie is in an excellent position to unlock significant value within its pipeline of 33 major development properties over the next decade or longer (paraphrased).— Motley Fool Canada opinion article
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