By Carolyn King 

Calloway Real Estate Investment Trust on Thursday said it would acquire the SmartCentres retail platform from Canadian real-estate developer Mitchell Goldhar in a deal worth 1.16 billion Canadian dollars ($950 million), including debt assumption.

The REIT said the deal will transform it into a fully integrated real-estate developer and operator. The transaction includes stakes in a C$1.1 billion portfolio of 24 shopping center properties located mainly in Ontario and Quebec, many of which house stores operated by Wal-Mart Stores Inc.'s Canada unit. Mr. Goldhar developed the first Wal-Mart store in Canada and has built SmartCentres into the country's largest developer of retail real estate.

The Canadian retail sector has seen a number of dramatic shifts in recent years, including the influx of several U.S. retailers, expansion moves by domestic retailers and the high-profile exit of Target Corp. after an ambitious but short-lived foray into Canada. Those shifts have created opportunities but also pressures for commercial landlords.

Calloway said it would fund the purchase through a combination of about C$644 million of assumed debt, cash from a C$200 million equity offering and the issuance of about C$160 million in units of subsidiary limited partnerships to Mr. Goldhar and certain other vendors. It will also use cash on hand and existing credit facilities. It valued the deal at C$1.16 billion ($950 million).

SmartCentres has a network of more than 50 million square feet of retail space, including more than 170 Walmart Canada stores, and provides various property services. It has more recently increased its focus on mixed-use development opportunities through its SmartUrban brand, Calloway noted. The REIT said the acquisition will position Calloway for longer-term growth.

Calloway said it would change its name to SmartREIT after the deal closes. Mr. Goldhar's stake in Calloway will rise to 23% from 21%, it added.

Write to Carolyn King at carolyn.m.king@wsj.com

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