Under the deal, Cedar will sell its 20 per cent stake in 21 of the properties to RioCan for $120 million, while the big Canadian trust will sell its 80 per cent stake in Franklin Village to Cedar for $60 million.
After adjustments for debt, RioCan will receive about $39 million in cash.
Once the deal is completed, RioCan will have a portfolio of 25 retail properties in the northeastern United States.
RioCan chief executive Edward Sonshine said the trust has benefited from its joint venture with Cedar.
"Cedar has played an integral role in the acquisition of these assets, as well as their leasing and management.
"While RioCan's objective is maintaining its growth trajectory in the northeastern United States through acquisitions, Cedar is seeking to consolidate its portfolio. Given these diverging objectives, both parties have agreed that the dissolution of our joint venture is the sensible path to take."
RioCan will continue to hold 9.4 million shares of Cedar, but has relinquished its right to a seat on Cedar's board of directors.
The pair formed the joint venture in 2009.
RioCan is Canada's largest shopping mall owner with a portfolio of 336 properties.
Units in the trust were up 41 cents at $29.05 on the Toronto Stock Exchange.