For the last 25 years, Edward Sonshine is known as the king of shopping malls in Canada.
Now the chief executive of one of the largest real estate investment funds in the country wants to be known for something more: housing.
"It's not me who changes," Sonshine said in an interview at RioCan REIT headquarters in Toronto.
"Change in our strategy has always been a reaction to the changing world, changing business, changing economy."
Since its foundation in 1993, RioCan has built a portfolio of approximately 250 retail properties, warehouses and offices.
Last year, the company noted how it could better use the privileged locations of its retail and plaza malls, many of which are on existing or near-built transportation lines.
Sonshine said that it is obvious for RioCan to turn these points of sale into mixed-use properties, adding rental units and offices to meet the growing demand for housing, especially in the country's largest cities.
Last month, Canada Mortgage Housing Corp. reported that the demand for rental properties continues to outpace supply due to the growth of immigration, the elderly population and the millennium generation.
"When you make it difficult for people to buy, they will rent. They have to live somewhere," Sonshine said. "The population of big cities continues to grow. We look at how the rental market has nowhere to go, but it's good."
Demand for retail space … will not grow & # 39;
Sonshine says the change is haphazard because the company is already looking to reduce its exposure to retail as consumer spending continues to migrate to online shopping instead of shopping in a large mall.
"There is no doubt that the demand for retail space in the next five to ten years will not grow," he said.
Sonshine said that this first crystallized for him in 2015 when the company's top tenant, the US retailer Target, announced that it was closing its stores in Canada.
Since then, RioCan has moved out of cities such as London, Ontario and Grande Prairie, Alta, and reinvesting in the country's six major urban markets, where it projects the largest growth. By 2020, RioCan wants more than 90% of its rental revenue to be generated by properties located in these major cities, up from the current 75% today.
Currently, there are eight specific-purpose lease projects, or 2,300 units under construction in Toronto, Ottawa and Calgary. The first two developments will be launched in the first quarter and summer of 2019.
Within five years, Sonshine sees RioCan's portfolio comprised of 10% residential properties and 5% office properties, with the vast majority still coming from the retail market.
Although the leased properties for the company's purposes are still a minority stake in the company's portfolio, Sonshine still considers it a great starting point for the company.
"The truth is we're really changing the mix," he said.
"It's a five-to-ten-year process to really make things happen." Sometimes I feel like a juggler, I'm trying to turn this great ship and move on reinventing things, it's a great juggling. "