First Capital, Inc. (FCAP): Business Model Canvas [Dec-2025 Updated]

As an analyst who has spent two decades mapping out real estate plays, I can tell you First Capital, Inc.'s business model is a masterclass in defensive, high-quality positioning. They aren't chasing every shiny object; instead, they are laser-focused on owning prime, grocery-anchored retail in Canada's best urban neighborhoods, which is why their portfolio, valued near $9.4 billion as of Q2 2025, boasts an occupancy rate of 97.1% in Q3 2025. This necessity-based focus translates directly to the bottom line, showing up as 6.4% Same Property NOI growth and a fantastic 13.5% lift on Q3 lease renewals, but to truly appreciate the stability, you need to see the structure of their key partnerships and how they manage the debt load-currently at 9.2x net debt to Adjusted EBITDA.

First Capital, Inc. (FCAP) - Canvas Business Model: Key Partnerships

You're looking at the essential relationships First Capital, Inc. (FCAP) relies on to keep its grocery-anchored, open-air centers running and growing. These aren't just vendors; they are critical components of the entire value chain, from financing to getting tenants in the door.

Major national and regional grocery chains as anchor tenants

The core of First Capital, Inc. (FCAP)'s model rests on its relationship with major grocers. These anchors drive traffic to the entire shopping center. As of late 2025, First Capital, Inc. (FCAP) owns interests in 136 Canadian Neighbourhoods, encompassing 21.8 million square feet of gross leasable area (GLA) as of September 30, 2025. The portfolio is defined by these grocery anchors.

Key incumbent retailers that are part of rejuvenation projects include major names you know:

• Loblaws
• Shoppers Drug Mart

The strength of these relationships is reflected in leasing performance. For the second quarter ended June 30, 2025, lease renewal spreads hit 16.2%. Even in the first quarter of 2025, spreads were 13.6%. Occupancy across the total portfolio was at a record 97.2% as of June 30, 2025.

Financial institutions for debt financing and revolving credit facilities

Access to capital markets is non-negotiable for a real estate investment trust. First Capital, Inc. (FCAP) actively manages its debt structure, using both long-term instruments and flexible credit lines. As of March 31, 2025, the liquidity position stood at approximately $0.8 billion. This included $676 million available on revolving credit facilities.

The company recently executed a significant financing move to manage its cost of capital. In November 2025, First Capital, Inc. (FCAP) agreed to issue C$250 million aggregate principal amount of Series F senior unsecured debentures. These debentures carry an interest rate of 4.461% per annum and mature on February 15, 2034. This follows a previous debt load where, as of December 31, 2024, there was $1.8 billion in principal amount of fixed rate instruments outstanding. The net debt to Adjusted EBITDA multiple was reported at 8.9x as of March 31, 2025.

Development and construction firms for property intensification projects

Development partners are crucial for executing the strategy of unlocking density and redevelopment value. A key objective through year-end 2026 was an aggregate investment of approximately $500 million into property development and redevelopment. Development completions were targeted around $200 million by the same date.

Specific project metrics show the scale of these partnerships. For one mixed-use development, First Capital, Inc. (FCAP) owns a 25% interest in a project that includes 679 residential units and 47,000 square feet of at-grade retail space. Furthermore, in 2025, the company anticipated receiving approvals for 2.9 million square feet of incremental density at share.

Real estate brokers and leasing agents for tenant acquisition

Brokers and leasing agents are the frontline for maintaining the high occupancy rates First Capital, Inc. (FCAP) achieves. The total portfolio occupancy reached 97.2% on June 30, 2025. The success in securing new and renewed leases is quantified by the spreads achieved.

Here's a look at the leasing success metrics for the first half of 2025:

Government and municipal authorities for zoning and entitlements

Working with municipal bodies is essential for the entitlements program, which is a core competency for First Capital, Inc. (FCAP). This partnership track is focused on increasing the density of existing assets. As noted, the company anticipated receiving approvals for 2.9 million square feet of incremental density at share during 2025. The ability to rezone development sites is cited as a key differentiator from peers.

The focus on density and land use intensification is a strategic pillar, with asset divestitures also targeting non-grocery anchored properties.

Finance: draft 13-week cash view by Friday.

First Capital, Inc. (FCAP) - Canvas Business Model: Key Activities

You're mapping out the core engine of First Capital, Inc. (FCAP) as of late 2025. This isn't about abstract strategy; it's about the daily, quarterly, and multi-year actions that drive cash flow and asset value in their grocery-anchored retail space.

Active property management and leasing to maintain high occupancy

The primary activity is keeping the lights on and the rent rolling in from high-quality tenants in top-tier neighborhoods. This means aggressive leasing to keep occupancy high, which is critical for Same Property Net Operating Income (NOI) growth. For the three months ended September 30, 2025, First Capital, Inc. achieved a total portfolio occupancy of 97.1%. This was a slight sequential decrease of 0.1% from the prior quarter but still an increase of 0.6% year-over-year from September 30, 2024. The core portfolio, which is the focus of management, is valued at approximately $7.2 billion and comprises about 82% of the total real estate investments.

Leasing activity shows strong pricing power. During the third quarter of 2025, net rental rates on lease renewals increased by 13.5% across a volume of 543,000 square feet. Looking back at the first quarter of 2025, the average Net Rental Rate per occupied square foot hit a record of $24.23, with lease renewals showing a first-year increase of 13.6%.

Strategic acquisitions of core, multi-tenant retail centers

First Capital, Inc. is selective about what it buys, focusing on core, multi-tenant grocery-anchored centers in demographically strong areas. Investment activity in the first quarter of 2025 included an acquisition of investment properties totaling $22.2 million, part of a total capital investment of $72 million for that quarter. More specifically, on February 3, 2025, the Trust acquired a property in Toronto, Ontario, for a purchase price of $21.25 million. The capital allocation strategy also involves selling non-core assets; First Capital, Inc. completed $72.0 million of previously announced dispositions in Q1 2025, and a total of $109 million in dispositions through the first nine months of 2025.

Development and redevelopment, including mixed-use intensification

The company actively pursues intensification to maximize asset value, often through mixed-use projects. The three-year strategic roadmap calls for an aggregate investment of approximately $500 million into property development and redevelopment. For the first quarter of 2025 alone, development expenditures were $17.4 million, with an additional $18.3 million invested in residential inventory. A specific recent example of intensification involves development approvals for 660,000 square feet of gross floor area across two mid-rise buildings, which includes 679 residential units and 47,000 square feet of retail space. The overall density pipeline across future development sites is substantial, sitting at approximately 23 million square feet as of Q3 2025, with about 0.8 million square feet under active development as of September 30, 2025.

• Three-year development completions target: approximately $300 million.
• Density pipeline size: approximately 23 million square feet.
• Active development as of September 30, 2025: approximately 0.8 million square feet.
• Q1 2025 Residential Inventory Investment: $18.3 million.

Capital allocation and balance sheet management, like the recent internal reorganization

Managing the balance sheet is a key activity, evidenced by leverage targets and a recent structural change. The three-year plan aims for a Net Debt to Adjusted EBITDA ratio in the low-8x range by year-end 2026. As of September 30, 2025, the ratio stood at 9.2x, up from 8.7x at December 31, 2024. Liquidity remained a focus, with approximately $0.7 billion available as of September 30, 2025. The unencumbered asset pool was approximately $6.4 billion, representing 69% of total assets at that time. A major capital allocation/governance activity was the internal reorganization, completed on November 30, 2025, via a plan of arrangement, which eliminated the subsidiary First Capital Realty Inc. This move was overwhelmingly supported, with unitholder approval at 99.58%, intended to simplify accounting and legal reporting complexity.

Here's the quick math on leverage:

Generating annual Operating FFO per unit growth of at least 3%

The overarching financial goal tied to these activities is achieving an average annual Operating Funds From Operations (OFFO) per unit growth of at least 3% over the three-year plan ending in 2026. The REIT delivered nearly 6% normalized OFFO per unit growth in 2024 against this target. Performance in 2025 shows some quarterly variation; for the three months ended March 31, 2025, Operating FFO per diluted unit was $0.32. However, for the three months ended September 30, 2025, Operating FFO per unit was $0.33, which represented a year-over-year growth of 9% when excluding a density bonus recognized in the prior year period. The second quarter of 2025 specifically showed a 6.2% year-over-year growth in Operating FFO per unit. It defintely shows the underlying operational strength is translating to cash flow growth, even with quarterly fluctuations.

First Capital, Inc. (FCAP) - Canvas Business Model: Key Resources

You're looking at the core assets that make First Capital, Inc. tick, the tangible and intangible things they own that make their value proposition possible. Honestly, for a real estate investment trust focused on urban retail, these resources are everything.

The foundation is the property portfolio itself, which is centered around high-quality, grocery-anchored shopping centers in prime Canadian neighborhoods. As of Q2 2025, the portfolio was valued at approximately $9.4 billion in assets, per your outline. By the end of Q3 2025, the total asset value stood at $9.2 billion, encompassing interests in 136 Canadian neighbourhoods, which translates to 21.8 million square feet of gross leasable area.

The quality of the portfolio shows up in the occupancy figures. You saw near-record performance recently. The total portfolio occupancy was reported at 97.1% as of September 30, 2025. That's just a hair below the record high of 97.2% seen in Q2 2025.

Liquidity is another critical resource, giving First Capital, Inc. flexibility for operations and opportunistic moves. As of Q3 2025, the strong liquidity position was approximately $0.7 billion, which included about $626 million of availability on revolving credit facilities and $33 million in cash on a proportionate basis. This compares to the Q2 2025 liquidity, which was approximately $1.0 billion.

The future value is locked in the development pipeline. This pipeline represents a deep bench of potential growth, exceeding the current portfolio size in potential density. As of September 30, 2025, First Capital, Inc. had approximately 0.8 million square feet under active development, including residential inventory. Furthermore, the overall density pipeline is massive, comprising approximately 23 million square feet of potential density, primarily in Toronto, Montreal, and Vancouver.

Here's a quick snapshot of the key financial and operational metrics as of late 2025:

Beyond the balance sheet numbers, the human capital is a key resource. You can't execute a strategy like this without the right people in place. First Capital, Inc. relies on its:

• Deep pipeline of high-quality development and redevelopment assets.
• Experienced in-house real estate management teams.
• Experienced in-house financial management teams.

The leasing team is also performing; they renewed approximately 550,000 square feet across 146 spaces in Q3 2025, achieving a year 1 renewal rent increase of over 13%, with net rental rates averaging $27.41 per square foot.

Finance: draft 13-week cash view by Friday.

First Capital, Inc. (FCAP) - Canvas Business Model: Value Propositions

You're looking at the core value First Capital, Inc. delivers to its stakeholders, which is built on the stability of necessity-based retail in prime urban locations. This isn't about chasing trends; it's about owning the daily needs of dense markets.

Stable and growing cash flow for unitholders through necessity-based retail

The commitment here is to deliver consistent returns. For unitholders, this stability is evidenced by the operating metrics. Operating FFO per diluted unit for the third quarter of 2025 was $0.33. Furthermore, the company announced a 3.0% increase to its monthly distribution, effective January 2025, bringing the annualized distribution to $0.89 per REIT unit. To manage this, FFO and AFFO payout ratios for the nine months ending September 30, 2025, were running in the high 60% range and mid-80% range, respectively.

High-quality, well-located retail space in dense urban markets for tenants

Tenants value the locations, which are in neighbourhoods with the strongest demographics in Canada. This quality is reflected in the portfolio's performance metrics as of September 30, 2025:

• Total portfolio occupancy stood at 97.1%.
• The portfolio average net rental rate reached a record $24.57 per square foot.
• The total asset value across 136 Canadian neighbourhoods was $9.2 billion.

Reduced economic cycle sensitivity due to grocery-anchored, daily-needs focus

The focus on grocery-anchored centers provides a defensive posture. This focus drives solid operational growth, even when the broader economy shifts. Same-property cash NOI, excluding lease termination fees and bad debt expense, grew a healthy 6.4% in the third quarter of 2025. Management expects the full-year 2025 same-property NOI growth to be at least 5%. The portfolio's core strength is undeniable.

Value creation through property intensification and mixed-use development

First Capital, Inc. actively creates value by building more density on existing land. As of June 30, 2025, management had identified approximately 22.9 million square feet of incremental density within the existing portfolio. To date, netting out density already sold, approximately 77% of the 23 million square foot pipeline has been submitted for entitlements. During the third quarter of 2025, the company invested approximately $49 million into property development, redevelopment and acquisitions.

Strong lease renewal lift, recently at 13.5% (on Q3 2025 renewals)

Leasing activity is a direct measure of the value proposition to tenants. The recent renewal spreads confirm strong market demand for the space. For the third quarter of 2025, net rental rates on renewed leases showed a lift of 13.5% when comparing the first year of the renewal term to the last year of the expiring term. This was executed on a volume of 543,000 square feet of renewals. The average rental rate over the full renewal term saw an even higher increase of 18.7%.

Here's a quick look at the key leasing and operational metrics from the third quarter of 2025:

Finance: draft 13-week cash view by Friday.

First Capital, Inc. (FCAP) - Canvas Business Model: Customer Relationships

You're looking at how First Capital, Inc. (FCAP) manages the crucial connections with the people who fund it and the tenants who occupy its space. It's all about stability and transparency in this business.

Dedicated property management for tenant retention and satisfaction

First Capital, Inc. (FCAP) manages a massive portfolio, which means tenant satisfaction is directly tied to cash flow stability. As of September 30, 2025, the company owned interests in 136 Canadian Neighbourhoods, encompassing 21.8 million square feet of gross leasable area, valued at $9.2 billion in total assets. Keeping these spaces occupied is key; total portfolio occupancy stood at a strong 97.1% as of that date. This represents a year-over-year increase of 0.6% from 96.5% at September 30, 2024. The leasing team is clearly effective at retaining current occupants, evidenced by the 13.5% net rental rate increase achieved on 543,000 square feet of lease renewals during the third quarter of 2025. Furthermore, the company reported same-property cash NOI growth of 6% for the nine months ended September 30, 2025, excluding lease termination fees and bad debt expense.

Long-term, structured lease agreements with anchor tenants

Stability in the grocery-anchored retail sector comes from the length of the lease commitments. While specific anchor tenant agreements aren't detailed, the general leasing structure suggests a focus on securing occupancy for the long haul. First Capital, Inc. (FCAP)'s standard term lease is noted to be in the 5-10 years range, though the final term is always determined during negotiations. The focus on grocery-anchored centers suggests these anchor tenants are locked in for terms that support the $9.2 billion asset base.

Proactive engagement on development and community integration

Customer relationships extend to the community fabric where the properties reside. First Capital, Inc. (FCAP) is actively building out its portfolio, with approximately 0.8 million square feet under active development as of September 30, 2025. The company emphasizes enriching communities, which includes an Arts Program that collaborates with art institutions to deliver innovative installations across its neighborhoods. This proactive approach to community development is part of the strategy to unlock long-term value in its properties.

Investor relations team for transparent communication with unitholders

For unitholders, transparency is the bedrock of the relationship. The company communicates its financial performance regularly, with Q3 2025 results released in early November 2025. The annualized distribution rate for 2025 was set at $0.89 per REIT unit, which included a 3.0% increase effective for the January 2025 distribution. The November 2025 cash distribution was announced at $0.074167 per REIT unit. The company also sought approval for a proposed internal reorganization via a plan of arrangement, with a special meeting scheduled for November 24, 2025. Unitholder support for governance matters is historically strong, with 91.77% of votes cast in favor at the 2024 Annual Meeting.

Digital investor portal for financial reports and distribution information

The firm supports its investor relations with digital tools. The First Capital Invest online portal allows unitholders to manage their holdings digitally. Key features available to investors include:

• Access to online transaction history.
• Ability to obtain system-generated confirmations of investment balance.
• Functionality to view historical fund prices.
• Access to the Q3 2025 Quarterly Report and Q3 2025 Investor Presentation.

Here's a quick look at the key metrics related to the investor base and property performance as of late 2025:

Finance: draft 13-week cash view by Friday.

First Capital, Inc. (FCAP) - Canvas Business Model: Channels

You're looking at how First Capital, Inc. (FCAP) gets its value proposition-grocery-anchored, open-air centres in prime Canadian neighbourhoods-out to its customers and stakeholders as of late 2025. The channels are a mix of direct operational teams and formal market communication avenues.

The direct channel involves the direct leasing team, which handles tenant negotiation and lease execution across the portfolio. This team is clearly effective, as evidenced by the latest leasing metrics. For the third quarter ended September 30, 2025, net rental rates on renewals increased by 13.5%. This lift was applied across a volume of 543,000 square feet of lease renewals during that quarter. The overall health of the physical space channel is strong, with total portfolio occupancy sitting at 97.1% as of September 30, 2025.

The physical retail properties and open-air centers themselves are a primary channel for customer interaction. As of September 30, 2025, First Capital, Inc. (FCAP) interests spanned 136 Canadian neighbourhoods. The total physical footprint measured 21.8 million square feet of gross leasable area. The average net rental rate across the occupied space reached a record $24.57 per square foot in the third quarter of 2025. Furthermore, the company maintains an active development pipeline, with approximately 0.8 million square feet under active development as of that same date.

Communication with unitholders flows through formal investor relations and public filings. The third quarter 2025 financial results were released, with the corresponding conference call held on November 5, 2025. These documents are made available on the corporate website and on SEDAR+. For the three months ended September 30, 2025, the reported net income attributable to unitholders was $66.6 million, translating to $0.31 per diluted unit. The balance sheet communication highlights leverage metrics; the net debt to Adjusted EBITDA multiple stood at 9.2x at September 30, 2025. Liquidity remained a focus, reported at approximately $0.7 billion on that date.

Market communication channels include the corporate website ($\text{www.fcr.ca}$) and press releases, which disseminate key operational and financial updates. The company also engages the capital markets directly through industry conferences and analyst calls. For instance, the Q3 2025 results call was a key touchpoint. The current analyst sentiment reflects this outreach, with the most recent rating being a Hold and a price target of C$20.00. The Current Market Cap was listed at C$3.95B with an Average Trading Volume of 256,700.

Here is a quick look at the key metrics tied to these channels as of late 2025:

The flow of information to unitholders is governed by regulatory requirements and proactive reporting. The company's commitment to its portfolio is reflected in the scale of its assets and the ongoing development work.

• Unencumbered Assets (IFRS Value): Approximately $6.4 billion.
• Percentage of Total Assets Unencumbered: 69%.
• Total Assets Value: $9.2 billion.
• Development Pipeline Size: Approximately 0.8 million square feet.
• Q1 2025 Weighted Average Diluted Units (000s): 214,502.

The direct engagement with tenants through the leasing team is the engine driving the core revenue stream, which is then communicated to the capital markets via filings and calls. If onboarding new tenants takes longer than expected, that 97.1% occupancy rate could slip, defintely impacting the next quarter's NOI growth figures.

First Capital, Inc. (FCAP) - Canvas Business Model: Customer Segments

You're looking at the core groups First Capital, Inc. (FCAP) serves, which are fundamentally tied to its grocery-anchored, open-air retail platform in Canada's most densely populated urban areas.

The primary customer base is anchored by tenants providing essential goods, which is a key driver of the portfolio's stability, as noted by management in early 2025.

• National and regional grocery chains (anchor tenants): These are the primary draw for the centres, underpinning the strategy of focusing on high-quality, grocery-anchored retail space.
• Retailers providing daily necessities and non-discretionary services: These tenants benefit from the strong demographics in the neighbourhoods where First Capital, Inc. (FCAP) operates.
• Institutional and individual unitholders seeking stable distributions: As a Real Estate Investment Trust (REIT), the trust structure directly targets investors seeking income, supported by a strong Dividend Smart Score of 4 as of late 2025.
• Mixed-use residential and commercial occupants in development projects: This segment is growing through redevelopment, exemplified by projects like the one at 138 Yorkville Avenue, which includes approximately 40,000 square feet of high-end retail at the base of a luxury condominium tower.
• Small, strategic tuck-in tenants in high-demographic areas: These are specifically targeted for acquisitions, alongside core grocery-anchored centres, as part of the capital allocation strategy.

Here's a quick look at the overall portfolio health as of the third quarter of 2025, which reflects the stability of these customer relationships:

The focus on high-quality, grocery-anchored assets is central to attracting and retaining the retail segments. For instance, the Q1 2025 results highlighted the excellent fundamentals for this specific retail space.

The unitholder segment is supported by the REIT's financial performance, such as the Operating FFO per unit reaching $0.33 for the three months ended September 30, 2025. Furthermore, the company's plan involves cumulative property dispositions totaling approximately $750 million, with acquisitions focused on core centres and strategic tuck-ins, showing active management of the asset base that supports tenant value.

The residential component within mixed-use developments represents an important, albeit secondary, customer group that complements the retail base, as seen in the ongoing development pipeline.

First Capital, Inc. (FCAP) - Canvas Business Model: Cost Structure

You're looking at the cost side of First Capital, Inc. (FCAP)'s business as of late 2025. For a company like First Capital, Inc. (FCAP), the cost structure is heavily weighted toward financing costs and operational overhead, though the data available shows a split between the BDC (FCAP) and the REIT entity (First Capital REIT, FCR.UN).

The cost structure is dominated by debt servicing, which is a key focus area given the leverage profile. For the First Capital REIT entity, the net debt to Adjusted EBITDA ratio stood at 9.2x as of September 30, 2025. This level of leverage directly translates to significant interest expense.

For First Capital, Inc. (FCAP), the BDC, the interest expense component showed some relief in the third quarter of 2025. Interest expense decreased by $397,000 when comparing the third quarter of 2025 to the same period in 2024. This was achieved even as the average balance of interest-bearing liabilities increased from $875.8 million in Q3 2024 to $891.3 million in Q3 2025, due to the average cost of interest-bearing liabilities falling to 1.66%.

Operating expenses, which cover property operations for the REIT and general overhead for the BDC, show pressure points. For First Capital, Inc. (FCAP), Noninterest expense increased by $0.54 million year-over-year for the third quarter of 2025. A significant portion of this increase was tied to property-related costs.

Here's a breakdown of the expense components we can quantify:

Capital expenditures for property development and redevelopment are a major planned outlay for the real estate arm. First Capital REIT has an aggregate investment planned of approximately $500 million into property development and redevelopment. For the nine months ended September 30, 2025, capital was invested into the business totaling $160 million, with $43 million of that being development-related expenditures in the third quarter alone.

Distribution payments to unitholders for the REIT are reflected in the Operating FFO per unit. Operating FFO for Q3 2025 was approximately $72 million, resulting in an Operating FFO per Diluted Unit of $0.33 for the quarter.

You should note the following specific expense drivers mentioned:

• Property operating expenses included costs associated with snow removal.
• Noninterest expenses included higher compensation and benefits.
• Noninterest expenses included costs from branch demolition/rebuild.
• Capital investments included expenditures for Yonge and Roselawn development.

First Capital, Inc. (FCAP) - Canvas Business Model: Revenue Streams

You're looking at the core income drivers for First Capital, Inc. (FCAP) as of late 2025, focusing on how the business converts its assets into cash flow. The model is heavily weighted toward recurring rental income, supplemented by strategic capital events.

The primary revenue engine is property rental revenue from leases. For the second quarter of 2025, this figure stood at $180.2 million. This recurring base is being actively strengthened through pricing power in the leasing market. We saw Same Property Net Operating Income (NOI) growth of 6.4% in the third quarter of 2025, which is a solid indicator of operational health in the existing portfolio.

To give you a clearer picture of the Q3 2025 operational performance that feeds into that NOI growth, here are some key metrics:

Beyond base rent, non-recurring income streams provide important boosts. Lease termination fees and other income for Q3 2025 included $0.9 million in termination fees. Management is defintely expecting this to continue, guiding for upwards of $1 million of additional lease termination income in the fourth quarter of this year.

Leasing activity itself is a major component of top-line growth. The renewal spreads are quite strong, showing tenants are paying more to stay in place. Here's what the leasing activity looked like in the third quarter:

• Lease renewals volume: Approximately 550,000 square feet across 146 spaces.
• Net rental rate increase on renewals: 13.5% year one vs. expiring term.
• Contractual growth rates: Approximately 3/4 of renewed leases included these escalations.

Capital recycling is another planned revenue stream, though less frequent. The company is targeting $750 million in cumulative proceeds from strategic property dispositions. These sales help fund acquisitions and development, which are future revenue generators.

Finally, the bottom line for unitholders reflects the success of all these activities, though it is impacted by non-cash items like investment property valuation changes. Net income attributable to unitholders for Q3 2025 was $66.6 million, or $0.31 per diluted unit. This compares to $81.1 million, or $0.38 per diluted unit, in the same prior year period, with the difference largely due to a smaller increase in investment property value in Q3 2025 ($1.1 million) versus Q3 2024 ($18.9 million).