Exhibit 99.2
 Managements Discussion and Analysis of Financial Results
 PART I  OBJECTIVES AND FINANCIAL HIGHLIGHTS
    
    
    12PART II  FINANCIAL STATEMENT ANALYSIS
    
    
    20PART III  U.S. OFFICE FUND SUPPLEMENTAL INFORMATION
    
    
    49PART IV  CANADIAN OFFICE FUND SUPPLEMENTAL INFORMATION
    
    
    52PART V  RISKS AND UNCERTAINTIES
    
    
    55PART VI  CRITICAL ACCOUNTING POLICIES AND ESTIMATES
    
    
    60PART VII  BUSINESS ENVIRONMENT AND OUTLOOK
    
    
    64
 FORWARD-LOOKING STATEMENTS
  11




---



##### 



Managements Discussion and Analysis of Financial Results  March 6, 2009
 PART I  OBJECTIVES AND FINANCIAL HIGHLIGHTS
 BASIS OF PRESENTATION
    OVERVIEW OF THE BUSINESS
   12




---



##### 



FINANCIAL HIGHLIGHTS
 (Millions, except per share amounts)
    
    2008
    
    
    2007
    
    
    2006(1)Results of operationsTotal revenue
    
    $
    2,805
    
    
    $
    2,842
    
    
    $
    1,823Net income
    
    
    700
    
    
    
    240
    
    
    
    135Net income per share  diluted
    
    
    1.77
    
    
    
    0.59
    
    
    
    0.37Common share dividends paid per share
    
    
    0.56
    
    
    
    0.55
    
    
    
    0.51Funds from operations
    
    
    626
    
    
    
    629
    
    
    
    443Funds from operations per share  diluted
    
    
    1.59
    
    
    
    1.57
    
    
    
    1.25Balance sheet dataTotal assets
    
    
    19,457
    
    
    
    20,473
    
    
    
    19,314Commercial properties
    
    
    14,901
    
    
    
    15,889
    
    
    
    15,287Commercial property debt
    
    
    11,505
    
    
    
    12,125
    
    
    
    11,185Shareholders equity
    
    
    3,427
    
    
    
    3,078
    
    
    
    3,112Book value per share
    
    
    8.80
    
    
    
    7.84
    
    
    
    7.80
 (1)
    
    Per share amounts have been restated to reflect the impact of the
three-for-two stock split effective May 4, 2007
 COMMERCIAL PROPERTY OPERATIONS
   
    
    Surfacing value from our properties through proactive leasing and select redevelopment
initiatives;
    
    Prudent capital management including the refinancing of mature properties;
    
    Monetizing development assets as the economy rebounds and continued supply constraints
create opportunities; and
    
    Expanding our asset management platform through the growth of our existing office funds
or through the establishment of new funds.
 13




---



##### 



Brookfield Properties
    
    
    Book
    
    
    
    
    
    
    Net BookNumber of
    
    
    Total Area
    
    
    Owned Interest
    
    
    Value
    
    
    Debt
    
    
    EquityRegion
    
    Properties
    
    
    (000s Sq. Ft.)
    
    
    (000s Sq. Ft.)(1)
    
    
    (Millions)
    
    
    (Millions)
    
    
    (Millions)DirectMidtown New York, New York
    
    
    2
    
    
    
    2,881
    
    
    
    2,005
    
    
    $
    883
    
    
    $
    684
    
    
    $
    199Downtown New York, New York
    
    
    5
    
    
    
    10,315
    
    
    
    9,359
    
    
    
    2,928
    
    
    
    1,874
    
    
    
    1,054Boston, Massachusetts
    
    
    2
    
    
    
    2,266
    
    
    
    2,266
    
    
    
    825
    
    
    
    573
    
    
    
    252Washington, D.C.
    
    
    6
    
    
    
    2,300
    
    
    
    2,300
    
    
    
    678
    
    
    
    499
    
    
    
    179Toronto, Ontario
    
    
    8
    
    
    
    5,439
    
    
    
    4,636
    
    
    
    930
    
    
    
    495
    
    
    
    435Calgary, Alberta
    
    
    7
    
    
    
    6,326
    
    
    
    3,164
    
    
    
    405
    
    
    
    321
    
    
    
    84Denver, Colorado
    
    
    1
    
    
    
    1,827
    
    
    
    1,827
    
    
    
    274
    
    
    
    161
    
    
    
    113Houston, Texas
    
    
    1
    
    
    
    892
    
    
    
    892
    
    
    
    155
    
    
    
    101
    
    
    
    54Other
    
    
    2
    
    
    
    926
    
    
    
    926
    
    
    
    100
    
    
    
    98
    
    
    
    2Corporate debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    325
    
    
    
    (325
    )34
    
    
    
    33,172
    
    
    
    27,375
    
    
    
    7,178
    
    
    
    5,131
    
    
    
    2,047U.S. Office FundMidtown New York, New York
    
    
    4
    
    
    
    3,682
    
    
    
    2,172
    
    
    
    1,243
    
    
    
    311
    
    
    
    932Downtown New York, New York
    
    
    2
    
    
    
    3,685
    
    
    
    3,685
    
    
    
    1,278
    
    
    
    397
    
    
    
    881Washington, D.C.
    
    
    22
    
    
    
    4,289
    
    
    
    4,110
    
    
    
    1,123
    
    
    
    366
    
    
    
    757Houston, Texas
    
    
    8
    
    
    
    8,226
    
    
    
    7,575
    
    
    
    1,135
    
    
    
    240
    
    
    
    895Los Angeles, California
    
    
    22
    
    
    
    10,763
    
    
    
    10,529
    
    
    
    2,616
    
    
    
    421
    
    
    
    2,195U.S. Fund debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,989
    
    
    
    (3,989
    )58
    
    
    
    30,645
    
    
    
    28,071
    
    
    
    7,395
    
    
    
    5,724
    
    
    
    1,671Canadian Office FundToronto, Ontario
    
    
    3
    
    
    
    3,697
    
    
    
    924
    
    
    
    217
    
    
    
    82
    
    
    
    135Calgary, Alberta
    
    
    1
    
    
    
    378
    
    
    
    95
    
    
    
    16
    
    
    
    17
    
    
    
    (1
    )Ottawa, Ontario
    
    
    6
    
    
    
    2,780
    
    
    
    695
    
    
    
    81
    
    
    
    19
    
    
    
    62Other
    
    
    2
    
    
    
    712
    
    
    
    179
    
    
    
    14
    
    
    
    14
    
    
    
    12
    
    
    
    7,567
    
    
    
    1,893
    
    
    
    328
    
    
    
    132
    
    
    
    196Continuing Operations
    
    
    104
    
    
    
    71,384
    
    
    
    57,339
    
    
    $
    14,901
    
    
    $
    10,987
    
    
    $
    3,914Discontinued Operations(2)
    
    
    4
    
    
    
    3,051
    
    
    
    3,051
    
    
    
    271
    
    
    
    199
    
    
    
    72108
    
    
    
    74,435
    
    
    
    60,390
    
    
    $
    15,172
    
    
    $
    11,186
    
    
    $
    3,986Office development sites
    
    
    
    
    
    
    16,237
    
    
    
    14,798
    
    
    
    1,074
    
    
    
    518
    
    
    
    556Redevelopment sites
    
    
    
    
    
    
    269
    
    
    
    269
    
    
    
    151
    
    
    
    
    
    
    
    151Total
    
    
    
    
    
    
    90,941
    
    
    
    75,457
    
    
    $
    16,397
    
    
    $
    11,704
    
    
    $
    4,693
 (1)
    
    Represents consolidated interest before non-controlling interests(2)
    
    RBC Plaza and 33 South Sixth Street in Minneapolis are currently classified as
discontinued operations
   14




---



##### 




    
    Asset Management
    
    Stable base fee for providing regular, ongoing services.
    
    Transaction
    
    Development, redevelopment and leasing activities conducted on behalf of
these funds.
    
    Performance
    
    Earned when certain predetermined benchmarks are exceeded. Performance fees
which can add considerably to fee revenue, typically arise later in a funds life cycle and
are therefore not fully reflected in current results.
    Total Portfolio
    
    
    
    Midtown New York
    
    

    
    Downtown New York
    
    

    
    BostonNet Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    perYear of Expiry
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)Currently available
    
    
    3,321
    
    
    
    5.1
    
    
    
    
    
    
    
    
    627
    
    
    
    9.6
    
    
    
    
    
    
    
    
    141
    
    
    
    1.0
    
    
    
    
    
    
    
    
    113
    
    
    
    5.72009
    
    
    2,547
    
    
    
    3.9
    
    
    $
    20
    
    
    
    
    375
    
    
    
    5.7
    
    
    $
    25
    
    
    
    
    196
    
    
    
    1.4
    
    
    $
    17
    
    
    
    
    183
    
    
    
    9.2
    
    
    $
    232010
    
    
    3,517
    
    
    
    5.4
    
    
    
    22
    
    
    
    
    391
    
    
    
    6.0
    
    
    
    32
    
    
    
    
    286
    
    
    
    2.1
    
    
    
    20
    
    
    
    
    125
    
    
    
    6.3
    
    
    
    292011
    
    
    4,750
    
    
    
    7.3
    
    
    
    24
    
    
    
    
    131
    
    
    
    2.0
    
    
    
    36
    
    
    
    
    670
    
    
    
    4.9
    
    
    
    36
    
    
    
    
    454
    
    
    
    22.8
    
    
    
    432012
    
    
    5,615
    
    
    
    8.6
    
    
    
    20
    
    
    
    
    446
    
    
    
    6.8
    
    
    
    30
    
    
    
    
    426
    
    
    
    3.1
    
    
    
    11
    
    
    
    
    48
    
    
    
    2.4
    
    
    
    252013
    
    
    11,794
    
    
    
    18.2
    
    
    
    27
    
    
    
    
    751
    
    
    
    11.5
    
    
    
    35
    
    
    
    
    4,759
    
    
    
    34.7
    
    
    
    35
    
    
    
    
    32
    
    
    
    1.6
    
    
    
    282014
    
    
    3,948
    
    
    
    6.1
    
    
    
    24
    
    
    
    
    215
    
    
    
    3.3
    
    
    
    26
    
    
    
    
    410
    
    
    
    3.0
    
    
    
    36
    
    
    
    
    30
    
    
    
    1.5
    
    
    
    392015
    
    
    6,670
    
    
    
    10.3
    
    
    
    20
    
    
    
    
    344
    
    
    
    5.3
    
    
    
    29
    
    
    
    
    2,156
    
    
    
    15.7
    
    
    
    19
    
    
    
    
    
    
    
    
    
    
    
    
    2016 & beyond
    
    
    22,752
    
    
    
    35.1
    
    
    
    30
    
    
    
    
    3,247
    
    
    
    49.8
    
    
    
    51
    
    
    
    
    4,675
    
    
    
    34.1
    
    
    
    33
    
    
    
    
    1,005
    
    
    
    50.5
    
    
    
    31Parking
    
    
    9,521
    
    
    
    
    
    
    
    
    
    
    
    
    36
    
    
    
    
    
    
    
    
    
    
    
    
    281
    
    
    
    
    
    
    
    
    
    
    
    
    276
    
    
    
    
    
    
    
    74,435
    
    
    
    100.0
    
    
    
    
    
    
    
    
    6,563
    
    
    
    100.0
    
    
    
    
    
    
    
    
    14,000
    
    
    
    100.0
    
    
    
    
    
    
    
    
    2,266
    
    
    
    100.0Average market net rent
    
    
    
    
    
    
    
    
    
    $
    32
    
    
    
    
    
    
    
    
    
    
    
    $
    68
    
    
    
    
    
    
    
    
    
    
    
    $
    37
    
    
    
    
    
    
    
    
    
    
    
    $
    30Average market gross rent
    
    
    
    
    
    
    
    $
    50
    
    
    
    
    
    
    
    
    
    
    
    $
    93
    
    
    
    
    
    
    
    
    
    
    
    $
    57
    
    
    
    
    
    
    
    
    
    
    
    $
    50
 (1)
    
    Net rent at expiration of lease
 15




---



##### 



Washington, D.C.
    
    
    
    Houston
    
    
    
    Los AngelesNet Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    perYear of Expiry
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)Currently available
    
    
    379
    
    
    
    6.7
    
    
    
    
    
    
    
    
    425
    
    
    
    5.1
    
    
    
    
    
    
    
    
    1,217
    
    
    
    14.12009
    
    
    511
    
    
    
    9.1
    
    
    $
    25
    
    
    
    
    181
    
    
    
    2.2
    
    
    $
    13
    
    
    
    
    422
    
    
    
    4.9
    
    
    $
    202010
    
    
    292
    
    
    
    5.2
    
    
    
    23
    
    
    
    
    304
    
    
    
    3.7
    
    
    
    13
    
    
    
    
    836
    
    
    
    9.7
    
    
    
    212011
    
    
    195
    
    
    
    3.5
    
    
    
    26
    
    
    
    
    780
    
    
    
    9.4
    
    
    
    14
    
    
    
    
    1,032
    
    
    
    12.0
    
    
    
    192012
    
    
    603
    
    
    
    10.7
    
    
    
    23
    
    
    
    
    1,102
    
    
    
    13.3
    
    
    
    13
    
    
    
    
    1,405
    
    
    
    16.3
    
    
    
    242013
    
    
    418
    
    
    
    7.4
    
    
    
    26
    
    
    
    
    775
    
    
    
    9.4
    
    
    
    12
    
    
    
    
    902
    
    
    
    10.5
    
    
    
    302014
    
    
    1,232
    
    
    
    21.9
    
    
    
    25
    
    
    
    
    595
    
    
    
    7.2
    
    
    
    11
    
    
    
    
    715
    
    
    
    8.3
    
    
    
    262015
    
    
    273
    
    
    
    4.9
    
    
    
    35
    
    
    
    
    657
    
    
    
    7.9
    
    
    
    14
    
    
    
    
    359
    
    
    
    4.2
    
    
    
    252016 & beyond
    
    
    1,716
    
    
    
    30.6
    
    
    
    44
    
    
    
    
    3,461
    
    
    
    41.8
    
    
    
    19
    
    
    
    
    1,736
    
    
    
    20.0
    
    
    
    28Parking
    
    
    970
    
    
    
    
    
    
    
    
    
    
    
    
    838
    
    
    
    
    
    
    
    
    
    
    
    
    2,139
    
    
    
    
    
    
    
    6,589
    
    
    
    100.0
    
    
    
    
    
    
    
    
    9,118
    
    
    
    100.0
    
    
    
    
    
    
    
    
    10,763
    
    
    
    100.0Average market net rent
    
    
    
    
    
    
    
    
    
    $
    35
    
    
    
    
    
    
    
    
    
    
    
    $
    24
    
    
    
    
    
    
    
    
    
    
    
    $
    25Average market gross rent
    
    
    
    
    
    
    
    
    
    $
    55
    
    
    
    
    
    
    
    
    
    
    
    $
    36
    
    
    
    
    
    
    
    
    
    
    
    $
    39
 (1)
    
    Net rent at expiration of lease
 Toronto
    
    
    
    Calgary
    
    
    
    OttawaNet Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    perYear of Expiry
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)Currently available
    
    
    164
    
    
    
    2.2
    
    
    
    
    
    
    
    
    7
    
    
    
    0.1
    
    
    
    
    
    
    
    
    8
    
    
    
    0.52009
    
    
    432
    
    
    
    5.7
    
    
    $
    15
    
    
    
    
    61
    
    
    
    1.1
    
    
    $
    24
    
    
    
    
    35
    
    
    
    2.0
    
    
    $
    142010
    
    
    580
    
    
    
    7.6
    
    
    
    22
    
    
    
    
    346
    
    
    
    6.1
    
    
    
    21
    
    
    
    
    7
    
    
    
    0.4
    
    
    
    272011
    
    
    511
    
    
    
    6.7
    
    
    
    22
    
    
    
    
    680
    
    
    
    12.0
    
    
    
    24
    
    
    
    
    8
    
    
    
    0.5
    
    
    
    132012
    
    
    763
    
    
    
    10.0
    
    
    
    22
    
    
    
    
    461
    
    
    
    8.1
    
    
    
    25
    
    
    
    
    6
    
    
    
    0.3
    
    
    
    2013
    
    
    1,478
    
    
    
    19.4
    
    
    
    24
    
    
    
    
    502
    
    
    
    8.8
    
    
    
    27
    
    
    
    
    1,131
    
    
    
    64.6
    
    
    
    162014
    
    
    280
    
    
    
    3.7
    
    
    
    25
    
    
    
    
    111
    
    
    
    2.0
    
    
    
    32
    
    
    
    
    9
    
    
    
    0.5
    
    
    
    202015
    
    
    715
    
    
    
    9.4
    
    
    
    25
    
    
    
    
    1,016
    
    
    
    17.9
    
    
    
    25
    
    
    
    
    542
    
    
    
    31.0
    
    
    
    122016 & beyond
    
    
    2,694
    
    
    
    35.3
    
    
    
    20
    
    
    
    
    2,497
    
    
    
    43.9
    
    
    
    27
    
    
    
    
    4
    
    
    
    0.2
    
    
    
    25Parking
    
    
    1,519
    
    
    
    
    
    
    
    
    
    
    
    
    1,023
    
    
    
    
    
    
    
    
    
    
    
    
    1,030
    
    
    
    
    
    
    
    9,136
    
    
    
    100.0
    
    
    
    
    
    
    
    
    6,704
    
    
    
    100.0
    
    
    
    
    
    
    
    
    2,780
    
    
    
    100.0Average market net rent
    
    
    
    
    
    
    
    
    
    $
    22
    
    
    
    
    
    
    
    
    
    
    
    $
    33
    
    
    
    
    
    
    
    
    
    
    
    $
    18Average market gross rent
    
    
    
    
    
    
    
    
    
    $
    43
    
    
    
    
    
    
    
    
    
    
    
    $
    47
    
    
    
    
    
    
    
    
    
    
    
    $
    31
 (1)
    
    Net rent at expiration of lease
 Denver
    
    
    
    Minneapolis
    
    
    
    OtherNet Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent
    
    
    
    
    
    
    
    
    
    
    
    Net Rent000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    per
    
    
    
    000s
    
    
    
    
    
    
    perYear of Expiry
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)
    
    
    
    Sq. Ft.
    
    
    %
    
    
    Sq. Ft.(1)Currently available
    
    
    31
    
    
    
    2.3
    
    
    
    
    
    
    
    
    188
    
    
    
    7.4
    
    
    
    
    
    
    
    
    21
    
    
    
    1.72009
    
    
    39
    
    
    
    2.9
    
    
    $
    21
    
    
    
    
    71
    
    
    
    2.8
    
    
    $
    10
    
    
    
    
    41
    
    
    
    3.3
    
    
    $
    132010
    
    
    104
    
    
    
    7.9
    
    
    
    21
    
    
    
    
    65
    
    
    
    2.6
    
    
    
    12
    
    
    
    
    181
    
    
    
    14.4
    
    
    
    122011
    
    
    99
    
    
    
    7.5
    
    
    
    19
    
    
    
    
    48
    
    
    
    1.9
    
    
    
    15
    
    
    
    
    142
    
    
    
    11.3
    
    
    
    142012
    
    
    87
    
    
    
    6.6
    
    
    
    18
    
    
    
    
    178
    
    
    
    7.0
    
    
    
    16
    
    
    
    
    90
    
    
    
    7.2
    
    
    
    142013
    
    
    151
    
    
    
    11.4
    
    
    
    21
    
    
    
    
    791
    
    
    
    31.3
    
    
    
    7
    
    
    
    
    104
    
    
    
    8.3
    
    
    
    162014
    
    
    134
    
    
    
    10.1
    
    
    
    14
    
    
    
    
    172
    
    
    
    6.8
    
    
    
    12
    
    
    
    
    45
    
    
    
    3.6
    
    
    
    112015
    
    
    59
    
    
    
    4.5
    
    
    
    17
    
    
    
    
    434
    
    
    
    17.2
    
    
    
    5
    
    
    
    
    115
    
    
    
    9.2
    
    
    
    162016 & beyond
    
    
    620
    
    
    
    46.8
    
    
    
    16
    
    
    
    
    583
    
    
    
    23.0
    
    
    
    13
    
    
    
    
    514
    
    
    
    41.0
    
    
    
    11Parking
    
    
    503
    
    
    
    
    
    
    
    
    
    
    
    
    521
    
    
    
    
    
    
    
    
    
    
    
    
    385
    
    
    
    
    
    
    
    1,827
    
    
    
    100.0
    
    
    
    
    
    
    
    
    3,051
    
    
    
    100.0
    
    
    
    
    
    
    
    
    1,638
    
    
    
    100.0Average market net rent
    
    
    
    
    
    
    
    
    
    $
    22
    
    
    
    
    
    
    
    
    
    
    
    $
    15
    
    
    
    
    
    
    
    
    
    
    
    $
    22Average market gross rent
    
    
    
    
    
    
    
    
    
    $
    33
    
    
    
    
    
    
    
    
    
    
    
    $
    27
    
    
    
    
    
    
    
    
    
    
    
    $
    38
 (1)
    
    Net rent at expiration of lease
 16




---



##### 



COMMERCIAL DEVELOPMENT AND REDEVELOPMENT
   OtherNumber
    
    

    Owned
    

    
    
    
    
    
    
    
    
    Share-
    
    

    Netof
    
    

    Interest
    
    
    
    
    
    Owned
    
    

    holders
    
    

    Owned(Square feet in 000s) Region
    
    Description
    
    Sites
    
    

    %
    
    Total
    
    

    Interest(1)
    
    

    Interest
    
    

    InterestDirectManhattan West
    
    New York
    
    Between 31st and 33rd Streets across
from the Farley Post Office
    
    
    1
    
    
    
    100
    %
    
    
    5,400
    
    
    
    5,400
    
    
    
    
    
    
    
    5,40077 K Street
    
    Washington
    
    Adjacent to Union Station
    
    
    1
    
    
    
    50
    %
    
    
    327
    
    
    
    164
    
    
    
    (4
    )
    
    
    160Bay Adelaide Centre
    
    Toronto
    
    Bay and Adelaide Streets
    
    
    1
    
    
    
    100
    %
    
    
    2,600
    
    
    
    2,600
    
    
    
    (286
    )
    
    
    2,314Brookfield
Place III
    
    Toronto
    
    Third phase of Brookfield Place project
    
    
    1
    
    
    
    54
    %
    
    
    800
    
    
    
    432
    
    
    
    (48
    )
    
    
    384Bankers Court
    
    Calgary
    
    East and West Parkades adjacent to
Bankers Hall
    
    
    1
    
    
    
    50
    %
    
    
    500
    
    
    
    250
    
    
    
    (28
    )
    
    
    222Herald Site
    
    Calgary
    
    One block from our existing Calgary
assets
    
    
    1
    
    
    
    100
    %
    
    
    1,200
    
    
    
    1,200
    
    
    
    (132
    )
    
    
    1,0681501 Tremont Place
    
    Denver
    
    One block from Republic Plaza
    
    
    1
    
    
    
    100
    %
    
    
    733
    
    
    
    733
    
    
    
    
    
    
    
    733Block 173
    
    Denver
    
    One block from Republic Plaza
    
    
    1
    
    
    
    100
    %
    
    
    600
    
    
    
    600
    
    
    
    
    
    
    
    6008
    
    
    
    
    
    
    
    12,160
    
    
    
    11,379
    
    
    
    (498
    )
    
    
    10,881U.S. Office FundReston Crescent
    
    Washington
    
    36 acre landscaped campus in Reston,
Virginia
    
    
    1
    
    
    
    100
    %
    
    
    1,000
    
    
    
    1,000
    
    
    
    (548
    )
    
    
    452Waterview
    
    Washington
    
    At the foot of the Key Bridge in
Rosslyn, Virginia
    
    
    1
    
    
    
    25
    %
    
    
    300
    
    
    
    75
    
    
    
    (41
    )
    
    
    341500 Smith Street
    
    Houston
    
    Adjacent to Four Allen Center
    
    
    1
    
    
    
    100
    %
    
    
    500
    
    
    
    500
    
    
    
    (274
    )
    
    
    226Allen Center Clay
Street
    
    Houston
    
    Located in the heart of the Allen
Center / Cullen Center complex
    
    
    1
    
    
    
    100
    %
    
    
    600
    
    
    
    600
    
    
    
    (329
    )
    
    
    271Five Allen Center
    
    Houston
    
    Adjacent to the Allen Center
    
    
    1
    
    
    
    100
    %
    
    
    1,100
    
    
    
    1,100
    
    
    
    (601
    )
    
    
    4995
    
    
    
    
    
    
    
    3,500
    
    
    
    3,275
    
    
    
    (1,793
    )
    
    
    1,482Canadian Office Fund300 Queen Street
    
    Ottawa
    
    Third phase of Place de Ville project
    
    
    1
    
    
    
    25
    %
    
    
    577
    
    
    
    144
    
    
    
    (16
    )
    
    
    1281
    
    
    
    
    
    
    
    577
    
    
    
    144
    
    
    
    (16
    )
    
    
    128Redevelopment
    
    
    
    
    
    
    14
    
    
    
    
    
    
    
    16,237
    
    
    
    14,798
    
    
    
    (2,307
    )
    
    
    12,4911225 Connecticut
    
    Washington
    
    Downtown Washington, D.C.
    
    
    1
    
    
    
    100
    %
    
    
    269
    
    
    
    269
    
    
    
    (147
    )
    
    
    122Total development and redevelopment
    
    
    15
    
    
    
    
    
    
    
    16,506
    
    
    
    15,067
    
    
    
    (2,454
    )
    
    
    12,613
 (1)
    
    Represents the companys consolidated interest before non-controlling
interests
 RESIDENTIAL DEVELOPMENT
    17




---



##### 



Under Development
    
    
    
    Housing Inventory
    
    
    
    Held for DevelopmentNumber of
    
    
    Book
    
    
    
    Number of
    
    
    Book
    
    
    
    Number of
    
    
    Book($ in Millions)
    
    Lots/Acres
    
    
    Value
    
    
    
    Units
    
    
    Value
    
    
    
    Acres
    
    
    ValueSingle Family (Lots)Alberta
    
    
    2,960
    
    
    $
    267
    
    
    
    
    86
    
    
    $
    14
    
    
    
    
    6,200
    
    
    $
    408Ontario
    
    
    180
    
    
    
    7
    
    
    
    
    388
    
    
    
    40
    
    
    
    
    1,854
    
    
    
    46Colorado
    
    
    998
    
    
    
    60
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,628
    
    
    
    146Texas
    
    
    106
    
    
    
    5
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,734
    
    
    
    99Missouri
    
    
    94
    
    
    
    5
    
    
    
    
    
    
    
    
    
    
    
    
    
    221
    
    
    
    19Total Single Family (Lots)
    
    
    4,338
    
    
    $
    344
    
    
    
    
    474
    
    
    $
    54
    
    
    
    
    14,637
    
    
    $
    718Total Single Family (Acre Equivalent)(1)
    
    
    744Multi-Family and Commercial (Acres)Alberta
    
    
    141
    
    
    $
    44
    
    
    
    
    173
    
    
    $
    34
    
    
    
    
    
    
    
    $
    Colorado
    
    
    10
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Texas
    
    
    6
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total Multi-Family and Commercial (Acres)
    
    
    157
    
    
    $
    46
    
    
    
    
    173
    
    
    $
    34
    
    
    
    
    
    
    
    $
    Total Book Value Land Under Development
    
    
    
    
    
    $
    390
    
    
    
    
    
    
    
    $
    88
    
    
    
    
    
    
    
    $
    718
 (1)
    
    Represents lots converted to acres based on a conversion factor of four to
seven lots per acre depending on region
 18




---



##### 



PERFORMANCE MEASUREMENT
  
    
    Net income per share;
    
    Net operating income;
    
    Funds from operations per share;
    
    Overall indebtedness level;
    
    Weighted average cost of debt; and
    
    Occupancy levels.
  Net Income
  Net Operating Income
  Funds from Operations
  KEY PERFORMANCE DRIVERS
  
    
    Increases in occupancies by leasing vacant space;
    
    Increases in rental rates as market conditions permit; and
    
    Reduction in occupancy costs through achieving economies of scale and diligently
managing contracts.
  
    
    The availability of equity capital at a reasonable cost;
    
    The availability of debt capital at a cost and on terms conducive to our goals; and
    
    The availability of new property acquisitions that fit into our strategic plan.
 19




---



##### 



PART II  FINANCIAL STATEMENT ANALYSIS
 ASSET PROFILE
  Proportional(1)
    
    
    Consolidated
    
    
    Consolidated(Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Commercial properties
    
    $
    10,834
    
    
    $
    14,901
    
    
    $
    15,889Commercial developments
    
    
    1,078
    
    
    
    1,225
    
    
    
    1,172Residential developments
    
    
    1,196
    
    
    
    1,196
    
    
    
    1,228Receivables and other
    
    
    893
    
    
    
    935
    
    
    
    1,056Intangible assets
    
    
    371
    
    
    
    637
    
    
    
    759Restricted cash and deposits
    
    
    96
    
    
    
    116
    
    
    
    151Cash and cash equivalents
    
    
    128
    
    
    
    157
    
    
    
    214Assets related to discontinued operations(2)
    
    
    290
    
    
    
    290
    
    
    
    4Total
    
    $
    14,886
    
    
    $
    19,457
    
    
    $
    20,473
 (1)
    
    Reflects Brookfield Properties effective 45% interest in the U.S. Office Fund(2)
    
    Includes $271 million of commercial properties and $19 million of other assets
associated with assets related to discontinued operations at December 31, 2008 (December 31, 2007 -
$3 million and $1 million, respectively)
 COMMERCIAL PROPERTIES
   Brookfield Properties
    
    
    Dec. 31, 2008

    
    
    Dec. 31, 2007Total Area
    
    
    Owned Interest
    
    
    Book Value
    
    
    Book Value
    
    
    Book Value
    
    
    Book ValueRegion
    
    (000s Sq. Ft.)
    
    
    (000s Sq. Ft.)(1)
    
    
    (Millions)
    
    
    per Sq. Ft.
    
    
    (Millions)
    
    
    Per Sq. Ft.Midtown, New York, New York
    
    
    6,563
    
    
    
    4,177
    
    
    $
    2,126
    
    
    $
    509
    
    
    $
    2,160
    
    
    $
    533Downtown, New York, New York
    
    
    14,000
    
    
    
    13,044
    
    
    
    4,206
    
    
    
    322
    
    
    
    4,250
    
    
    
    346Boston, Massachusetts
    
    
    2,266
    
    
    
    2,266
    
    
    
    825
    
    
    
    364
    
    
    
    854
    
    
    
    395Washington, D.C.
    
    
    6,589
    
    
    
    6,410
    
    
    
    1,801
    
    
    
    281
    
    
    
    1,822
    
    
    
    288Houston, Texas
    
    
    9,118
    
    
    
    8,467
    
    
    
    1,290
    
    
    
    152
    
    
    
    1,076
    
    
    
    149Los Angeles, California
    
    
    10,763
    
    
    
    10,529
    
    
    
    2,616
    
    
    
    248
    
    
    
    2,637
    
    
    
    253Toronto, Ontario
    
    
    9,136
    
    
    
    5,560
    
    
    
    1,147
    
    
    
    206
    
    
    
    1,637
    
    
    
    265Calgary, Alberta
    
    
    6,704
    
    
    
    3,259
    
    
    
    421
    
    
    
    129
    
    
    
    523
    
    
    
    160Ottawa, Ontario
    
    
    2,780
    
    
    
    695
    
    
    
    81
    
    
    
    117
    
    
    
    102
    
    
    
    147Denver, Colorado
    
    
    1,827
    
    
    
    1,827
    
    
    
    274
    
    
    
    150
    
    
    
    280
    
    
    
    156Minneapolis, Minnesota
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    422
    
    
    
    140Other
    
    
    1,638
    
    
    
    1,105
    
    
    
    114
    
    
    
    103
    
    
    
    126
    
    
    
    114Continuing operations
    
    
    71,384
    
    
    
    57,339
    
    
    
    14,901
    
    
    
    260
    
    
    
    15,889
    
    
    
    272Discontinued operations
    
    
    3,051
    
    
    
    3,051
    
    
    
    271
    
    
    
    89
    
    
    
    3
    
    
    
    58Total
    
    
    74,435
    
    
    
    60,390
    
    
    $
    15,172
    
    
    $
    251
    
    
    $
    15,892
    
    
    $
    271
 (1)
    
    Represents the companys consolidated interest before non-controlling
interests
 TENANT INSTALLATION COSTS AND CAPITAL EXPENDITURES
  20




---



##### 



(Millions)
    
    2008
    
    
    2007Leasing commissions
    
    $
    31
    
    
    $
    59Tenant improvements
    
    
    106
    
    
    
    107Total
    
    $
    137
    
    
    $
    166
  ASSETS RELATED TO DISCONTINUED OPERATIONS
   COMMERCIAL DEVELOPMENTS
   Sq. Ft. CurrentlyBuildable
    
    
    Under Construction
    
    
    Book Value
    
    
    Book Value(Millions)
    
    Sq. Ft. (000s)
    
    
    (000s)
    
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Active developmentsBay Adelaide Centre, Toronto
    
    
    2,600
    
    
    
    1,160
    
    
    $
    510
    
    
    $
    416Reston Crescent, Washington, D.C.
    
    
    1,000
    
    
    
    185
    
    
    
    70
    
    
    
    56Waterview, Washington, D.C.
    
    
    300
    
    
    
    300
    
    
    
    19
    
    
    
    2777 K Street, Washington, D.C.
    
    
    327
    
    
    
    327
    
    
    
    44
    
    
    
    34Bankers Court, Calgary
    
    
    500
    
    
    
    265
    
    
    
    40
    
    
    
    224,727
    
    
    
    2,237
    
    
    
    683
    
    
    
    555PlanningManhattan West, New York
    
    
    5,400
    
    
    
    
    
    
    
    269
    
    
    
    207Herald Site, Calgary
    
    
    1,200
    
    
    
    
    
    
    
    47
    
    
    
    53Others
    
    
    
    
    
    
    
    
    
    
    75
    
    
    
    521500 Smith Street, Houston
    
    
    500Five Allen Center, Houston
    
    
    1,100Allen Center Clay Street, Houston
    
    
    6001501 Tremont Place, Denver
    
    
    733Block 173, Denver
    
    
    600Brookfield Place III, Toronto
    
    
    800300 Queen Street, Ottawa
    
    
    577Total developments
    
    
    16,237
    
    
    
    2,237
    
    
    
    1,074
    
    
    
    867Redevelopment1225 Connecticut Avenue, Washington, D.C.
    
    
    269
    
    
    
    269
    
    
    
    151
    
    
    
    107Reclassified to commercialFour Allen Center, Houston(1)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    198Total developments and redevelopments
    
    
    16,506
    
    
    
    2,506
    
    
    $
    1,225
    
    
    $
    1,172
 (1)
    
    During the first quarter of 2008, this property was reclassified to commercial
properties
 21




---



##### 




    
    Bay Adelaide Centre in Toronto represents one of our largest development projects.
Ground-breaking on Phase I of this project took place in July of 2006 and construction is
actively underway. Phase I represents 1.2 million square feet of a three-phase project that
is expected to total 2.6 million square feet and be completed in 2009. Due to the
continuous construction on Phase I, the book value of this site has increased by $94
million since December 31, 2007.
    
    Reston Crescent, a development project acquired with the Trizec portfolio in the fourth
quarter of 2006, is a 36 acre landscaped campus where construction is substantially
complete on Two Reston Crescent, a 185,000 square foot building. As a result of
construction progress to date, the book value of this project has increased by $14 million
since December 31, 2007.
    
    Construction on Bankers Court in Calgary, a 500,000 square foot, two-building project,
commenced in the third quarter of 2006. Active development of the first building, totaling
265,000 square feet, is taking place and is expected to be complete by the first quarter of
2009. The building is 100% leased. As a result of the continuous development, the book
value of this site has increased by $18 million since December 31, 2007.
    
    Construction on 77 K Street in Washington, D.C., a development project we acquired in
July 2006, commenced in the fourth quarter of 2006. As a result of active construction, the
book value of this site has increased by $10 million since December 31, 2007. Construction
is substantially complete.
    
    1225 Connecticut Avenue in Washington, D.C. is a property that was acquired as part of
the Trizec portfolio. This site was reclassified as a redevelopment site in the third
quarter of 2007. The book value increased to $151 million at December 31, 2008 from $107
million at December 31, 2007 as a result of the ongoing development. Construction is
substantially complete.
    
    Waterview, a development site in Washington, D.C. acquired with the Trizec portfolio,
was under construction prior to the acquisition. During the second quarter of 2007, we sold
the 630,000 square foot office portion of this development site. The remaining 300,000
square foot building is substantially complete. This site is our only hotel/residential
asset. The book value of this site has decreased by $8 million to $19 million at December
31, 2008.
   (Millions)
    
    2008
    
    
    2007Construction costs
    
    $
    331
    
    
    $
    211Interest capitalized
    
    
    62
    
    
    
    54Tenant improvements
    
    
    
    
    
    
    47Property taxes and other
    
    
    1
    
    
    
    1Total
    
    $
    394
    
    
    $
    313
 22




---



##### 



Square FeetCurrently
    
    
    
    
    
    
    Owned Interest(1)Under
    
    
    Expected
    
    
    
    
    
    
    
    
    
    
    Estimated
    
    
    Total
    
    
    
    
    
    
    EstimatedConstruction
    
    
    Date of
    
    
    %
    
    
    Investment
    
    
    Total
    
    
    Construction
    
    
    Amount
    
    
    NOI at(Millions)
    
    (000s)
    
    
    Completion
    
    
    Pre-leased
    
    
    to Date
    
    
    Investment
    
    
    Loan
    
    
    Drawn
    
    
    StabilizationActive developmentsBay Adelaide Centre, Toronto
    
    
    1,160
    
    
    
    Q3 2009
    
    
    
    72
    %
    
    $
    380
    
    
    $
    443
    
    
    $
    344
    
    
    $
    226
    
    
    $
    32Reston Crescent, Washington, D.C.
    
    
    185
    
    
    Complete
    (3)
    
    
    31
    %
    
    
    45
    
    
    
    64
    
    
    
    
    
    
    
    
    
    
    
    477 K Street, Washington, D.C.
    
    
    327
    
    
    Complete
    (3)
    
    
    
    
    
    
    45
    
    
    
    64
    
    
    
    52
    
    
    
    30
    
    
    
    5Bankers Court, Calgary
    
    
    265
    
    
    
    Q1 2009
    
    
    
    100
    %
    
    
    42
    
    
    
    45
    
    
    
    40
    
    
    
    30
    
    
    
    4Subtotal office developments
    
    
    1,937
    
    
    
    
    
    
    
    
    
    
    $
    512
    
    
    $
    616
    
    
    $
    436
    
    
    $
    286
    
    
    $
    45Waterview, Washington, D.C.(2)
    
    
    300
    
    
    Complete
    (3)
    
    
    
    
    
    
    19
    
    
    
    19
    
    
    
    5
    
    
    
    5
    
    
    
    2Total
    
    
    2,237
    
    
    
    
    
    
    
    
    
    
    $
    531
    
    
    $
    635
    
    
    $
    441
    
    
    $
    291
    
    
    $
    47Redevelopments1225 Connecticut, Washington, D.C.
    
    
    269
    
    
    Complete
    (3)
    
    
    100
    %
    
    
    150
    
    
    
    175
    
    
    
    
    
    
    
    
    
    
    
    12Total
    
    
    269
    
    
    
    
    
    
    
    
    
    
    $
    150
    
    
    $
    175
    
    
    $
    
    
    
    $
    
    
    
    $
    12
 (1)
    
    Represents the companys consolidated interest before non-controlling interests(2)
    
    Estimated value of hotel and condominium upon completion is $45 million(3)
    
    Substantially complete as at December 31, 2008
 RESIDENTIAL DEVELOPMENTS
   (Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Under development
    
    $
    390
    
    
    $
    431Housing inventory
    
    
    88
    
    
    
    85Held for development
    
    
    718
    
    
    
    712Total
    
    $
    1,196
    
    
    $
    1,228
 23




---



##### 



Number of Lots/Acres
    
    
    
    Book Value (Millions)Under development
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007
    
    
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Single Family (Lots)Alberta
    
    
    2,960
    
    
    
    3,725
    
    
    
    $
    267
    
    
    $
    314Ontario
    
    
    180
    
    
    
    330
    
    
    
    
    7
    
    
    
    24Colorado
    
    
    998
    
    
    
    858
    
    
    
    
    60
    
    
    
    42Texas
    
    
    106
    
    
    
    106
    
    
    
    
    5
    
    
    
    4Missouri
    
    
    94
    
    
    
    88
    
    
    
    
    5
    
    
    
    2Total Single Family (Lots)
    
    
    4,338
    
    
    
    5,107
    
    
    
    $
    344
    
    
    $
    386Total Single Family (Acre Equivalent)(1)
    
    
    744
    
    
    
    843Multi-Family and Commercial (Acres)Alberta
    
    
    141
    
    
    
    136
    
    
    
    $
    44
    
    
    $
    44Colorado
    
    
    10
    
    
    
    25
    
    
    
    
    1
    
    
    
    1Texas
    
    
    6
    
    
    
    
    
    
    
    
    1
    
    
    
    Total Multi-Family and Commercial (Acres)
    
    
    157
    
    
    
    161
    
    
    
    $
    46
    
    
    $
    45Total Book Value Land Under Development
    
    
    
    
    
    
    
    
    
    
    $
    390
    
    
    $
    431
 (1)
    
    Represents lots converted to acres based on a conversion factor of four to seven lots
per acre depending on region
 Number of Units
    
    
    
    Book Value (Millions)Housing Inventory
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007
    
    
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Single FamilyAlberta
    
    
    86
    
    
    
    224
    
    
    
    $
    14
    
    
    $
    28Ontario
    
    
    388
    
    
    
    239
    
    
    
    
    40
    
    
    
    28474
    
    
    
    463
    
    
    
    
    54
    
    
    
    56Multi-FamilyAlberta
    
    
    173
    
    
    
    174
    
    
    
    
    34
    
    
    
    29Total
    
    
    647
    
    
    
    637
    
    
    
    $
    88
    
    
    $
    85
 Number of Acres
    
    
    
    Book Value (Millions)Held for Development
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007
    
    
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Alberta
    
    
    6,200
    
    
    
    5,955
    
    
    
    $
    408
    
    
    $
    424Ontario
    
    
    1,854
    
    
    
    2,184
    
    
    
    
    46
    
    
    
    64Colorado
    
    
    2,628
    
    
    
    2,167
    
    
    
    
    146
    
    
    
    122Texas
    
    
    3,734
    
    
    
    3,328
    
    
    
    
    99
    
    
    
    84Missouri
    
    
    221
    
    
    
    226
    
    
    
    
    19
    
    
    
    18Total
    
    
    14,637
    
    
    
    13,860
    
    
    
    $
    718
    
    
    $
    712
 RECEIVABLES AND OTHER ASSETS
   (Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Accounts receivable
    
    $
    137
    
    
    $
    135Straight-line rent and free rent receivables
    
    
    409
    
    
    
    378Real estate mortgages and loans receivable
    
    
    21
    
    
    
    63Residential receivables and other assets
    
    
    241
    
    
    
    292Prepaid expenses and other assets
    
    
    127
    
    
    
    188Total
    
    $
    935
    
    
    $
    1,056
 24




---



##### 



INTANGIBLE ASSETS
   (Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Intangible assetsLease origination costs
    
    $
    382
    
    
    $
    377Tenant relationships
    
    
    499
    
    
    
    501Above-market leases and below-market ground leases
    
    
    66
    
    
    
    82$
    947
    
    
    $
    960Less accumulated amortizationLease originations costs
    
    
    (151
    )
    
    
    (124
    )Tenant relationships
    
    
    (138
    )
    
    
    (62
    )Above-market leases and below-market ground leases
    
    
    (21
    )
    
    
    (15
    )Total net
    
    $
    637
    
    
    $
    759
 RESTRICTED CASH AND DEPOSITS
  CASH AND CASH EQUIVALENTS
   25




---



##### 



LIABILITIES AND SHAREHOLDERS EQUITY
  Proportional(1)
    
    
    Consolidated
    
    
    Consolidated(Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007LiabilitiesCommercial property debt
    
    $
    8,354
    
    
    $
    11,505
    
    
    $
    12,125Accounts payable and other liabilities
    
    
    1,005
    
    
    
    1,168
    
    
    
    1,357Intangible liabilities
    
    
    416
    
    
    
    707
    
    
    
    834Future income tax liability
    
    
    204
    
    
    
    247
    
    
    
    600Liabilities related to discontinued operations(2)
    
    
    217
    
    
    
    217
    
    
    
    3Capital securities  corporate
    
    
    882
    
    
    
    882
    
    
    
    1,053Capital securities  fund subsidiaries
    
    
    
    
    
    
    711
    
    
    
    739Non-controlling interests  fund subsidiaries
    
    
    
    
    
    
    212
    
    
    
    216Non-controlling interests  other subsidiaries
    
    
    68
    
    
    
    68
    
    
    
    86Preferred equity  subsidiaries
    
    
    313
    
    
    
    313
    
    
    
    382Shareholders equityPreferred equity  corporate
    
    
    45
    
    
    
    45
    
    
    
    45Common equity
    
    
    3,382
    
    
    
    3,382
    
    
    
    3,033Total
    
    $
    14,886
    
    
    $
    19,457
    
    
    $
    20,473
 (1)
    
    Reflects Brookfield Properties effective 45% interest in the U.S. Office Fund(2)
    
    Includes $199 of commercial property debt and $18 million of other liabilities
related to discontinued operations at December 31, 2008 (December 31, 2007  nil and $3
million, respectively)
 COMMERCIAL PROPERTY DEBT
   Three-Year
    
    
    Annual ResultsObjective
    
    Average
    
    
    2008
    
    
    2007
    
    
    2006Debt-to-total-market-capitalization
    
    
    52
    %
    
    
    69
    %
    
    
    47
    %
    
    
    41
    %Non-recourse debt as a percentage of total(1)
    
    
    94
    %
    
    
    94
    %
    
    
    94
    %
    
    
    94
    %Interest expense coverage
    
    
    2.1x
    
    
    
    2.1x
    
    
    
    2.0x
    
    
    
    2.1x
 (1)
    
    Non-recourse to Brookfield Properties
  26




---



##### 



Balance at(Millions)
    
    
    
    
    
    Interest Rate %

    
    Maturity Date


    
    
    Mortgage/Loan


    
    
    Dec. 31, 2008(1)First Quarter2000 L Street
    
    Extended
    
    
    6.26
    %
    
    March
    
    
    2009
    
    
    $
    56
    
    
    $
    56Silver Spring Metro Plaza /
2401 Pennsylvania Avenue /
1250 Connecticut Avenue
    
    Financed
    
    LIBOR + 240bps
    
    June
    
    
    2009
    
    
    
    160
    
    
    
    158105 Adelaide
    
    Refinanced
    
    
    5.32
    %
    
    February
    
    
    2013
    
    
    
    22
    
    
    
    18Second QuarterRoyal Centre
    
    Refinanced
    
    
    4.96
    %
    
    May
    
    
    2012
    
    
    
    120
    
    
    
    985670 Wilshire
    
    Refinanced
    
    LIBOR + 205bps
    
    May
    
    
    2013
    
    
    
    57
    
    
    
    57Hudsons Bay Centre
    
    Refinanced
    
    
    5.20
    %
    
    May
    
    
    2013
    
    
    
    108
    
    
    
    8975 State Street
    
    Refinanced
    
    LIBOR + 300bps
    
    June
    
    
    2013
    
    
    
    300
    
    
    
    294Canadian Western Bank /
2 Queen Street East /
Altius Centre
    
    Financed
    
    
    5.64
    %
    
    December
    
    
    2017
    
    
    
    62
    
    
    
    52Third Quarter22 Front Street
    
    Refinanced
    
    
    6.24
    %
    
    October
    
    
    2020
    
    
    
    19
    
    
    
    16Corporate Term Loan
    
    Extended
    
    LIBOR + 250bps
    
    September
    
    
    2009
    
    
    
    104
    
    
    
    104Bethesda Crescent
    
    Extended
    
    
    7.07
    %
    
    March
    
    
    2009
    
    
    
    33
    
    
    
    32Fourth QuarterPetro Canada Centre
    
    Refinanced
    
    BA + 225bps
    
    October
    
    
    2009
    
    
    
    123
    
    
    
    122Two Ballston Plaza
    
    Extended
    
    
    6.91
    %
    
    March
    
    
    2009
    
    
    
    25
    
    
    
    25RBC Plaza
    
    Extended
    
    LIBOR + 150bps
    
    June
    
    
    2009
    
    
    
    79
    
    
    
    79Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    1,268
    
    
    $
    1,200
 (1)
    
    Net of transaction costs and in US millions
    27




---



##### 



Dec. 31, 2008(1,2)($ in millions)
    
    Location
    
    Rate %

    
    Maturity Date
    
    Proportional(3)
    
    
    Consolidated
    
    
    Mortgage DetailsDirectRBC Plaza(4)
    
    Minneapolis
    
    
    2.50
    
    
    June
    
    2009
    
    $
    79
    
    
    $
    79
    
    
    Non-recourse, floating ratePetro-Canada Centre
    
    Calgary
    
    
    5.01
    
    
    October
    
    2009
    
    
    122
    
    
    
    122
    
    
    Non-recourse, floating rateWest 31st Street(5)
    
    New York
    
    
    1.84
    
    
    December
    
    2009
    
    
    105
    
    
    
    105
    
    
    Partial-recourse, floating rateRBC Plaza(4)
    
    Minneapolis
    
    
    6.00
    
    
    December
    
    2009
    
    
    29
    
    
    
    29
    
    
    Non-recourse, fixed rate77 K Street(5)
    
    Washington, D.C.
    
    
    3.17
    
    
    April
    
    2010
    
    
    30
    
    
    
    30
    
    
    Non-recourse, floating rateBay Adelaide Centre(5)(6)
    
    Toronto
    
    
    3.53
    
    
    July
    
    2010
    
    
    226
    
    
    
    226
    
    
    Non-recourse, floating rateBankers Court(5)
    
    Calgary
    
    
    3.52
    
    
    October
    
    2010
    
    
    30
    
    
    
    30
    
    
    Non-recourse, floating rate245 Park Avenue
    
    New York
    
    
    6.65
    
    
    February
    
    2011
    
    
    225
    
    
    
    225
    
    
    Non-recourse, fixed rateQueens Quay Terminal
    
    Toronto
    
    
    7.26
    
    
    March
    
    2011
    
    
    28
    
    
    
    28
    
    
    Non-recourse, fixed rateFifth Avenue Place
    
    Calgary
    
    
    7.59
    
    
    August
    
    2011
    
    
    59
    
    
    
    59
    
    
    Non-recourse, fixed rate1201 Louisiana Street
    
    Houston
    
    
    6.73
    
    
    September
    
    2011
    
    
    101
    
    
    
    101
    
    
    Non-recourse, fixed ratePotomac Tower
    
    Washington, D.C.
    
    
    4.72
    
    
    November
    
    2011
    
    
    75
    
    
    
    75
    
    
    Non-recourse, fixed rate300 Madison Avenue
    
    New York
    
    
    3.52
    
    
    April
    
    2012
    
    
    59
    
    
    
    59
    
    
    Non-recourse, floating rateExchange Tower
    
    Toronto
    
    
    6.83
    
    
    April
    
    2012
    
    
    50
    
    
    
    50
    
    
    Non-recourse, fixed rateRoyal Centre
    
    Vancouver
    
    
    4.96
    
    
    May
    
    2012
    
    
    98
    
    
    
    98
    
    
    Non-recourse, fixed rateHSBC Building
    
    Toronto
    
    
    8.19
    
    
    October
    
    2012
    
    
    19
    
    
    
    19
    
    
    Non-recourse, fixed rate105 Adelaide
    
    Toronto
    
    
    5.32
    
    
    February
    
    2013
    
    
    18
    
    
    
    18
    
    
    Non-recourse, fixed rateBay Wellington Tower
    
    Toronto
    
    
    6.49
    
    
    April
    
    2013
    
    
    275
    
    
    
    275
    
    
    Non-recourse, fixed rateHudsons Bay Centre(7)
    
    Toronto
    
    
    5.20
    
    
    May
    
    2013
    
    
    89
    
    
    
    89
    
    
    Non-recourse, fixed rate75 State Street
    
    Boston
    
    
    5.50
    
    
    June
    
    2013
    
    
    294
    
    
    
    294
    
    
    Partial-recourse, floating rateTwo World Financial Center
    
    New York
    
    
    6.91
    
    
    September
    
    2013
    
    
    387
    
    
    
    387
    
    
    Non-recourse, fixed rateFour World Financial Center
    
    New York
    
    
    6.95
    
    
    September
    
    2013
    
    
    230
    
    
    
    230
    
    
    Non-recourse, fixed rate601 South 12th Street
    
    Washington, D.C.
    
    
    5.42
    
    
    October
    
    2013
    
    
    52
    
    
    
    52
    
    
    Non-recourse, fixed rate701 South 12th Street
    
    Washington, D.C.
    
    
    5.42
    
    
    October
    
    2013
    
    
    43
    
    
    
    43
    
    
    Non-recourse, fixed rateBankers Hall
    
    Calgary
    
    
    7.20
    
    
    November
    
    2013
    
    
    140
    
    
    
    140
    
    
    Non-recourse, fixed rateRepublic Plaza
    
    Denver
    
    
    5.14
    
    
    April
    
    2014
    
    
    161
    
    
    
    161
    
    
    Non-recourse, fixed rate1625 Eye Street
    
    Washington, D.C.
    
    
    6.00
    
    
    September
    
    2014
    
    
    123
    
    
    
    123
    
    
    Non-recourse, fixed rateTwo World Financial Center
    
    New York
    
    
    11.02
    
    
    September
    
    2014
    
    
    111
    
    
    
    111
    
    
    Non-recourse, floating rate53 State Street
    
    Boston
    
    
    5.96
    
    
    August
    
    2016
    
    
    279
    
    
    
    279
    
    
    Non-recourse, fixed rateOne Bethesda
    
    Washington, D.C.
    
    
    5.66
    
    
    October
    
    2016
    
    
    53
    
    
    
    53
    
    
    Non-recourse, fixed rateOne World Financial Center
    
    New York
    
    
    5.83
    
    
    February
    
    2017
    
    
    309
    
    
    
    309
    
    
    Non-recourse, fixed rateOne Liberty Plaza
    
    New York
    
    
    6.14
    
    
    September
    
    2017
    
    
    837
    
    
    
    837
    
    
    Non-recourse, fixed rateWest 33rd Street(5)
    
    New York
    
    
    5.90
    
    
    April
    
    2018
    
    
    122
    
    
    
    122
    
    
    Non-recourse, fixed rate22 Front Street
    
    Toronto
    
    
    6.24
    
    
    October
    
    2020
    
    
    16
    
    
    
    16
    
    
    Non-recourse, fixed rate33 South Sixth Street(4)
    
    Minneapolis
    
    
    8.72
    
    
    May
    
    2028
    
    
    91
    
    
    
    91
    
    
    Non-recourse, fixed rate701 9th Street
    
    Washington, D.C.
    
    
    6.73
    
    
    December
    
    2028
    
    
    153
    
    
    
    153
    
    
    Non-recourse, fixed rate300 Madison Avenue
    
    New York
    
    
    7.26
    
    
    April
    
    2032
    
    
    400
    
    
    
    400
    
    
    Non-recourse, fixed rateTotal Direct
    
    
    
    
    6.08
    
    
    
    
    
    
    
    
    $
    5,518
    
    
    $
    5,518U.S. Office FundTwo Ballston Plaza
    
    Washington, D.C.
    
    
    6.91
    
    
    March
    
    2009
    
    $
    16
    
    
    $
    25
    
    
    Non-recourse, fixed rateBethesda Crescent
    
    Washington, D.C.
    
    
    7.07
    
    
    March
    
    2009
    
    
    20
    
    
    
    32
    
    
    Non-recourse, fixed rate2000 L Street
    
    Washington, D.C.
    
    
    6.26
    
    
    March
    
    2009
    
    
    35
    
    
    
    56
    
    
    Non-recourse, fixed rateSilver Spring Metro Plaza(8)
    
    Washington, D.C.
    
    
    6.00
    
    
    June
    
    2009
    
    
    60
    
    
    
    97
    
    
    Non-recourse, floating rate2401 Pennsylvania Avenue(8)
    
    Washington, D.C.
    
    
    6.00
    
    
    June
    
    2009
    
    
    11
    
    
    
    17
    
    
    Non-recourse, floating rate1250 Connecticut(8)
    
    Washington, D.C.
    
    
    6.00
    
    
    June
    
    2009
    
    
    27
    
    
    
    44
    
    
    Non-recourse, floating rateWaterview(5)
    
    Washington, D.C.
    
    
    2.46
    
    
    August
    
    2009
    
    
    3
    
    
    
    5
    
    
    Non-recourse, floating rate1460 Broadway
    
    New York
    
    
    5.11
    
    
    November
    
    2012
    
    
    
    
    
    
    11
    
    
    Non-recourse, fixed rate5670 Wilshire
    
    Los Angeles
    
    
    3.48
    
    
    May
    
    2013
    
    
    
    
    
    
    57
    
    
    Non-recourse, floating rateFour Allen Center
    
    Houston
    
    
    5.77
    
    
    October
    
    2013
    
    
    149
    
    
    
    240
    
    
    Non-recourse, fixed rateErnst & Young Plaza
    
    Los Angeles
    
    
    5.07
    
    
    February
    
    2014
    
    
    69
    
    
    
    111
    
    
    Non-recourse, fixed rateGrace Building
    
    New York
    
    
    5.54
    
    
    July
    
    2014
    
    
    118
    
    
    
    191
    
    
    Non-recourse, fixed rate1411 Broadway
    
    New York
    
    
    5.50
    
    
    July
    
    2014
    
    
    
    
    
    
    109
    
    
    Non-recourse, fixed rateBank of America Plaza
    
    Los Angeles
    
    
    5.31
    
    
    September
    
    2014
    
    
    144
    
    
    
    232
    
    
    Non-recourse, fixed rate2001 M Street
    
    Washington, D.C.
    
    
    5.25
    
    
    December
    
    2014
    
    
    28
    
    
    
    45
    
    
    Non-recourse, fixed rateVictor Building
    
    Washington, D.C.
    
    
    5.39
    
    
    February
    
    2016
    
    
    31
    
    
    
    50
    
    
    Non-recourse, fixed rateOne New York Plaza
    
    New York
    
    
    5.50
    
    
    March
    
    2016
    
    
    245
    
    
    
    397
    
    
    Non-recourse, fixed rateMarina Towers
    
    Los Angeles
    
    
    5.84
    
    
    April
    
    2016
    
    
    13
    
    
    
    21
    
    
    Non-recourse, fixed rateU.S. Fund Pool debt
    
    
    
    
    6.85
    
    
    May
    
    2011
    
    
    138
    
    
    
    306
    
    
    Non-recourse, fixed rateU.S. Fund corporate debt
    
    
    
    
    3.70
    
    
    October
    
    2011
    
    
    1,204
    
    
    
    3,089
    
    
    Non-recourse, floating rateU.S. Fund Pool debt
    
    
    
    
    1.95
    
    
    October
    
    2011
    
    
    267
    
    
    
    594
    
    
    Non-recourse, floating rateTotal U.S. Office Fund
    
    
    
    
    4.40
    
    
    
    
    
    
    
    
    $
    2,578
    
    
    $
    5,729
 (1)
    
    Represents the companys consolidated interest before non-controlling interests(2)
    
    Net of $45 million of transaction costs(3)
    
    Reflects Brookfield Properties effective 45% interest in the U.S. Office Fund(4)
    
    Commercial property debt of $199 million relates to discontinued operations(5)
    
    Development debt(6)
    
    Has two one-year extension options available at maturity. The criteria to extend the
first option to 2011 has been met as of December 31, 2008(7)
    
    Has a two-year extension option to May 2015 which is available to the company
provided certain debt service and loan-to-value thresholds are met(8)
    
    Property debt is cross-collateralized
 28




---



##### 



Dec. 31, 2008(1,2)($ in millions)
    
    Location
    
    Rate %

    
    Maturity Date
    
    Proportional(3)
    
    
    Consolidated
    
    
    Mortgage DetailsCanadian Office FundEnbridge Tower
    
    Edmonton
    
    
    6.72
    
    
    June
    
    2009
    
    $
    2
    
    
    $
    2
    
    
    Non-recourse, fixed ratePlace de Ville I
    
    Ottawa
    
    
    7.81
    
    
    November
    
    2009
    
    
    5
    
    
    
    5
    
    
    Non-recourse, fixed rateFirst Canadian Place
    
    Toronto
    
    
    8.06
    
    
    December
    
    2009
    
    
    51
    
    
    
    51
    
    
    Non-recourse, fixed rate151 Yonge Street
    
    Toronto
    
    
    6.01
    
    
    June
    
    2012
    
    
    8
    
    
    
    8
    
    
    Non-recourse, fixed rateJean Edmonds Tower
    
    Ottawa
    
    
    5.55
    
    
    January
    
    2014
    
    
    1
    
    
    
    1
    
    
    Non-recourse, fixed rate2 Queen Street East
    
    Toronto
    
    
    5.64
    
    
    December
    
    2017
    
    
    23
    
    
    
    23
    
    
    Non-recourse, fixed rateAltius Centre
    
    Calgary
    
    
    5.64
    
    
    December
    
    2017
    
    
    17
    
    
    
    17
    
    
    Non-recourse, fixed rateCanadian Western Bank
    
    Edmonton
    
    
    5.64
    
    
    December
    
    2017
    
    
    12
    
    
    
    12
    
    
    Non-recourse, fixed rateJean Edmonds Tower
    
    Ottawa
    
    
    6.79
    
    
    January
    
    2024
    
    
    13
    
    
    
    13
    
    
    Non-recourse, fixed rateTotal Canadian Office Fund
    
    
    
    
    6.81
    
    
    
    
    
    
    
    
    $
    132
    
    
    $
    132CorporateCorporate Revolver
    
    
    
    
    1.54
    
    
    June
    
    2009
    
    $
    221
    
    
    $
    221
    
    
    Recourse, floating rateTerm Facility
    
    
    
    
    2.94
    
    
    September
    
    2009
    
    
    104
    
    
    
    104
    
    
    Recourse, floating rateTotal Corporate
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    325
    
    
    $
    325Total Commercial Property Debt
    
    
    
    
    5.07
    
    
    
    
    
    
    
    
    $
    8,553
    
    
    $
    11,704
 (1)
    
    Represents the companys consolidated interest before non-controlling interests(2)
    
    Net of $45 million of transaction costs(3)
    
    Reflects Brookfield Properties effective 45% interest in the U.S. Office Fund
  Weighted-AverageScheduled
    
    
    
    
    
    
    
    
    
    
    Interest Rate at(Millions)
    
    Amortization(1)
    
    
    Maturities
    
    
    Total(2)
    
    
    Dec. 31, 20082009
    
    $
    164
    
    
    $
    995
    
    
    $
    1,159
    
    
    
    3.87
    %2010
    
    
    182
    
    
    
    286
    
    
    
    468
    
    
    
    4.64
    %2011(3)
    
    
    191
    
    
    
    4,463
    
    
    
    4,654
    
    
    
    3.98
    %2012
    
    
    199
    
    
    
    182
    
    
    
    381
    
    
    
    6.24
    %2013
    
    
    61
    
    
    
    1,286
    
    
    
    1,347
    
    
    
    5.93
    %2014 and thereafter
    
    
    669
    
    
    
    3,026
    
    
    
    3,695
    
    
    
    6.14
    %Total commercial property debt
    
    $
    1,466
    
    
    $
    10,238
    
    
    $
    11,704
    
    
    
    5.07
    %
 (1)
    
    Paid through our annual cash flows(2)
    
    Includes $199 million of commercial property debt related to discontinued operations
at December 31, 2008 (December 31, 2007  nil)(3)
    
    Corporate mezzanine debt of $3,089 million within the U.S. Office Fund matures in
2011
 CONTRACTUAL OBLIGATIONS
  Payments Due By Period(Millions)
    
    Total
    
    
    1 year
    
    
    2 - 3 Years
    
    
    4 - 5 Years
    
    
    After 5 YearsCommercial property debt(1)
    
    $
    11,704
    
    
    $
    1,159
    
    
    $
    5,122
    
    
    $
    1,728
    
    
    $
    3,695Residential development debt
    
    
    434
    
    
    
    379
    
    
    
    55
    
    
    
    
    
    
    
    Capital securities  corporate
    
    
    882
    
    
    
    
    
    
    
    164
    
    
    
    163
    
    
    
    555Capital securities  fund subsidiaries(2)
    
    
    240
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    240Interest expense(3)Commercial property debt
    
    
    3,207
    
    
    
    653
    
    
    
    1,125
    
    
    
    556
    
    
    
    873Capital securities  corporate
    
    
    264
    
    
    
    48
    
    
    
    88
    
    
    
    72
    
    
    
    56Capital securities  fund subsidiaries(2)
    
    
    135
    
    
    
    28
    
    
    
    56
    
    
    
    51
    
    
    
    Minimum rental payments  ground leases(4)
    
    
    2,983
    
    
    
    28
    
    
    
    54
    
    
    
    55
    
    
    
    2,846
 (1)
    
    Net of transaction costs and includes $199 million of debt associated with
discontinued operations(2)
    
    Excludes redeemable equity interests(3)
    
    Represents aggregate interest expense expected to be paid over the term of the debt,
on an undiscounted basis, based on current interest and foreign exchange rates(4)
    
    Represents payments on properties situated on land held under leases or other
agreements
 29




---



##### 



Credit Ratings
   DBRS
    
    
    S&PCorporate rating
    
    BBB(high
    )

    BBBPreferred shares
    
    Pfd-3(high
    )
    
    P3(high
    )
  Corporate Guarantees and Contingent Obligations
   ACCOUNTS PAYABLE AND OTHER LIABILITIES
   (Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Accounts payable and accrued liabilities
    
    $
    525
    
    
    $
    613Straight-line rent payable
    
    
    70
    
    
    
    59Residential payables and accrued liabilities
    
    
    139
    
    
    
    184Land development debt
    
    
    434
    
    
    
    501Total
    
    $
    1,168
    
    
    $
    1,357
 INTANGIBLE LIABILITIES
   (Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Intangible liabilitiesBelow-market leases
    
    $
    996
    
    
    $
    971Above-market ground lease obligations
    
    
    40
    
    
    
    581,036
    
    
    
    1,029Less accumulated depreciationBelow-market leases
    
    
    (322
    )
    
    
    (189
    )Above-market ground lease obligations
    
    
    (7
    )
    
    
    (6
    )Total net
    
    $
    707
    
    
    $
    834
 30




---



##### 



FUTURE INCOME TAXES
  (Millions)
    
    2008
    
    
    2007Future income tax assets:Loss carryforwards
    
    $
    134
    
    
    $
    344Deferred financing costs
    
    
    6
    
    
    
    44140
    
    
    
    388Future income tax liabilities:Properties
    
    
    314
    
    
    
    840Deferred revenue
    
    
    41
    
    
    
    134Other
    
    
    32
    
    
    
    14387
    
    
    
    988Net future income tax liabilities
    
    $
    247
    
    
    $
    600
   CAPITAL SECURITIES  CORPORATE
   Shares
    
    
    Cumulative(Millions, except share information)
    
    Outstanding
    
    
    Dividend Rate

    
    Dec. 31, 2008
    
    
    Dec. 31, 2007(1)Class AAA Series E
    
    
    8,000,000
    
    
    70% of bank prime

    
    $
    
    
    
    $
    Class AAA Series F
    
    
    8,000,000
    
    
    
    6.00
    %
    
    
    163
    
    
    
    199Class AAA Series G
    
    
    4,400,000
    
    
    
    5.25
    %
    
    
    109
    
    
    
    109Class AAA Series H
    
    
    8,000,000
    
    
    
    5.75
    %
    
    
    162
    
    
    
    199Class AAA Series I
    
    
    8,000,000
    
    
    
    5.20
    %
    
    
    164
    
    
    
    199Class AAA Series J
    
    
    8,000,000
    
    
    
    5.00
    %
    
    
    163
    
    
    
    198Class AAA Series K
    
    
    6,000,000
    
    
    
    5.20
    %
    
    
    121
    
    
    
    149Total
    
    
    
    
    
    
    
    
    
    $
    882
    
    
    $
    1,053
 (1)
    
    Net of transaction costs of $6 million and $7 million at December 31, 2008 and
December 31, 2007, respectively
 For redemption dates, refer to Note 15 of the consolidated financial statements
 For details regarding the terms on our capital securities  corporate, refer to our Annual
Information Form
 CAPITAL SECURITIES  FUND SUBSIDIARIES
  (Millions)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Debt securities
    
    $
    240
    
    
    $
    234Redeemable equity interests
    
    
    471
    
    
    
    505Total
    
    $
    711
    
    
    $
    739
   31




---



##### 



NON-CONTROLLING INTERESTS  FUND SUBSIDIARIES
  NON-CONTROLLING INTERESTS  OTHER SUBSIDIARIES
   (Millions)
    
    Others Equity Ownership

    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Common shares of BPO Properties(1)
    
    
    10.8
    %
    
    $
    45
    
    
    $
    73Limited partnership units of Brookfield Financial Properties
    
    
    0.6
    %
    
    
    13
    
    
    
    13UCAR joint venture(2)
    
    
    50.0
    %
    
    
    10
    
    
    
    Total
    
    
    
    
    
    $
    68
    
    
    $
    86
 (1)
    
    Canadian dollar denominated(2)
    
    New joint venture in 2008
  PREFERRED EQUITY  SUBSIDIARIES
   Shares
    
    
    Preferred
    
    
    Cumulative(Millions, except share information)
    
    Outstanding
    
    
    Shares Series
    
    
    Dividend Rate

    
    Dec. 31, 2008
    
    
    Dec. 31, 20071,805,489
    
    
    Series G
    
    70% of bank prime
    
    $
    37
    
    
    $
    453,816,527
    
    
    Series J
    
    70% of bank prime
    
    
    78
    
    
    
    96300
    
    
    Series K
    
    30-day BA + 0.4%
    
    
    124
    
    
    
    1502,847,711
    
    
    Series M
    
    70% of bank prime
    
    
    58
    
    
    
    71800,000
    
    
    Series N
    
    30-day BA + 0.4%
    
    
    16
    
    
    
    20Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    313
    
    
    $
    382
  32




---



##### 



PREFERRED EQUITY  CORPORATE
   Shares
    
    
    Cumulative(Millions, except share information)
    
    Outstanding
    
    
    Dividend Rate

    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Class A redeemable voting
    
    
    14,202,000
    
    
    
    7.50
    %
    
    $
    11
    
    
    $
    11Class AA Series E
    
    
    2,000,000
    
    
    70% of bank prime

    
    
    34
    
    
    
    34Total
    
    
    
    
    
    
    
    
    
    $
    45
    
    
    $
    45
 For details regarding the terms on our preferred shares, refer to our Annual Information Form
  COMMON EQUITY
  Dec. 31, 2008
    
    
    Dec. 31, 2007Common shares outstanding
    
    
    391,118,440
    
    
    
    392,805,608Unexercised options
    
    
    9,718,216
    
    
    
    8,256,994Common shares outstanding  diluted(1)
    
    
    400,836,656
    
    
    
    401,062,602Common shares repurchased
    
    
    2,268,600
    
    
    
    4,513,720
 (1)
    
    Includes all potential common shares at December 31, 2008 and December 31,
2007    (Millions, except per share information)
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007Shareholders equity
    
    $
    3,427
    
    
    $
    3,078Less: preferred equity
    
    
    (45
    )
    
    
    (45
    )3,382
    
    
    
    3,033Add: option proceeds(1)
    
    
    144
    
    
    
    113Fully diluted common shareholders equity
    
    
    3,526
    
    
    
    3,146Fully diluted common shares outstanding
    
    
    400.8
    
    
    
    401.1Book value per share
    
    $
    8.80
    
    
    $
    7.84
 (1)
    
    Calculated as options outstanding multiplied by the weighted average exercise price
of options outstanding at period end  33




---



##### 



CAPITAL RESOURCES AND LIQUIDITY
  
    
    fund recurring expenses;
    
    meet debt service requirements;
    
    make dividend payments;
    
    fund those capital expenditures deemed mandatory, including tenant improvements;
    
    fund current development costs not covered under construction loans; and
    
    fund investing activities which could include:
 
    
    discretionary capital expenditures;
    
    repurchase of our stock; and
    
    property acquisitions.
   
    
    cashflows from operations;
    
    construction loans;
    
    establishment of new funds;
    
    proceeds from sales of assets; and
    
    our credit facilities and refinancing opportunities.
     34




---



##### 



Utilization of Cash Resources
  (Millions)
    
    2008
    
    
    
    2007
    
    

    TotalOperatingIncrease in land and housing inventory and related working capital
    
    $
    (148
    )
    
    
    $
    (355
    )
    

    $
    (503
    )Net increase in cash from other operating activities
    
    
    607
    
    
    
    
    342
    
    

    
    949459
    
    
    
    
    (13
    )
    

    
    446FinancingCommercial and corporate borrowings, net of repayments
    
    
    (165
    )
    
    
    
    375
    
    

    
    210Land development borrowings, net of repayments
    
    
    12
    
    
    
    
    219
    
    

    
    231Other acquisition financing arranged
    
    
    
    
    
    
    
    130
    
    

    
    130Capital securities arranged  fund subsidiaries
    
    
    34
    
    
    
    
    
    
    

    
    34Distributions to non-controlling interests
    
    
    (36
    )
    
    
    
    (19
    )
    

    
    (55
    )Net issuance (repurchase) of common shares
    
    
    (35
    )
    
    
    
    (100
    )
    

    
    (135
    )Preferred share dividends
    
    
    (3
    )
    
    
    
    (3
    )
    

    
    (6
    )Common share dividends
    
    
    (220
    )
    
    
    
    (216
    )
    

    
    (436
    )(413
    )
    
    
    
    386
    
    

    
    (27
    )InvestingLoans receivable and other
    
    
    35
    
    
    
    
    40
    
    

    
    75Loans receivable  affiliate
    
    
    
    
    
    
    
    (200
    )
    

    
    (200
    )Acquisitions of real estate, net
    
    
    (16
    )
    
    
    
    (307
    )
    

    
    (323
    )Dispositions of real estate, net
    
    
    420
    
    
    
    
    224
    
    

    
    644Development and redevelopment investments
    
    
    (394
    )
    
    
    
    (313
    )
    

    
    (707
    )Commercial property tenant improvements
    
    
    (106
    )
    
    
    
    (107
    )
    

    
    (213
    )Restricted cash and deposits
    
    
    35
    
    
    
    
    365
    
    

    
    400Capital expenditures
    
    
    (77
    )
    
    
    
    (49
    )
    

    
    (126
    )(103
    )
    
    
    
    (347
    )
    

    
    (450
    )(Decrease) increase in cash
    
    $
    (57
    )
    
    
    $
    26
    
    

    $
    (31
    )
   Cost of capital
   35




---



##### 



Cost of Capital(1)
    
    
    Underlying Value(2)(Millions)
    
    Dec. 31, 2008

    
    Dec. 31, 2007

    
    Dec. 31, 2008
    
    
    Dec. 31, 2007LiabilitiesCommercial property debt
    
    
    5.07
    %
    
    
    6.65
    %
    
    $
    11,704
    
    
    $
    12,125Residential debt
    
    
    3.87
    %
    
    
    6.17
    %
    
    
    434
    
    
    
    501Capital securities  corporate
    
    
    5.42
    %
    
    
    5.42
    %
    
    
    882
    
    
    
    1,053Capital securities  fund subsidiaries(3)
    
    
    10.00
    %
    
    
    10.00
    %
    
    
    711
    
    
    
    739Non-controlling interests  fund subsidiaries(3)
    
    
    10.00
    %
    
    
    10.00
    %
    
    
    212
    
    
    
    216Non-controlling interests  other subsidiaries(4)
    
    
    12.00
    %
    
    
    12.00
    %
    
    
    68
    
    
    
    86Preferred equity  subsidiaries
    
    
    4.19
    %
    
    
    4.40
    %
    
    
    313
    
    
    
    382Shareholders equityPreferred equity  corporate
    
    
    3.68
    %
    
    
    5.01
    %
    
    
    45
    
    
    
    45Common equity(5)
    
    
    12.00
    %
    
    
    12.00
    %
    
    
    3,023
    
    
    
    7,562Total(6)
    
    
    5.30
    %
    
    
    7.19
    %
    
    $
    17,392
    
    
    $
    22,709
 (1)
    
    As a percentage of average book value(2)
    
    Underlying value of liabilities represents the cost to retire on maturity. Underlying
value of common equity is based on the closing stock price of Brookfield Properties common
shares(3)
    
    Assuming 10% return on co-invested capital(4)
    
    Assuming 12% return on co-invested capital(5)
    
    Determined on a market value basis(6)
    
    In calculating the weighted average cost of capital, the cost of debt has been
tax-effected 36




---



##### 



OPERATING RESULTS
 NET INCOME
  
    
    a $498 million decrease ($1.27 per diluted share) in future income tax expense related
to a gain of $479 million recognized as a result of the conversion of our legacy U.S.
operations to a real estate investment trust (REIT);
    
    $68 million of growth ($0.17 per diluted share) from commercial property operating
income, primarily as a result of the acquisition of the remaining interest in 53 and 75
State Street in Boston in the fourth quarter of 2007 as well as the reclassification of
Four Allen Center in Houston to an operating property in 2008, inclusive of an offsetting
$13 million ($0.03 per diluted share) of costs incurred in the third quarter of 2008 as a
result of damage to our Houston properties from Hurricane Ike;
    
    a decrease in interest expense of $36 million ($0.09 per diluted share) as a result of
reduced LIBOR rates on our floating rate debt as well as the impact of various refinancings
completed throughout 2008;
    
    no transaction costs in the current year as compared to 2007, which had transaction
costs of $44 million associated with the defeasance of debt on One Liberty Plaza in New
York, in addition to costs related to the Trizec merger and integration;
    
    a $24 million foreign exchange gain ($0.06 per diluted share) resulting from the
reduction of our net investment in BPO Properties, a self-sustaining subsidiary in our
Canadian operations, on account of a special dividend paid;
    
    an increase of $8 million ($0.02 per diluted share) in interest and other income
primarily due to $7 million of income related to an asbestos settlement in our favor
associated with One Liberty Plaza in New York, which was received in the second quarter of
2008, offset by:
 
    
    a decrease in discontinued operations of $96 million ($0.24 per diluted share)
primarily due to an impairment loss recognized on our Minneapolis properties, offset
by the gain on the sale of TD Canada Trust Tower in Toronto;
    
    a decrease in residential operations of $93 million ($0.24 per diluted share)
mainly due to decreased land sales and home closings as a result of the slowing
economy and an oversupply of homes in the Alberta market;
    
    a reduction of $10 million ($0.03 per diluted share) in losses absorbed by
co-investors in the U.S. Office Fund; and
    
    an increase in depreciation and amortization expense of $26 million ($0.07 per
diluted share) related to the acquisition of the remaining interest in 53 and 75
State Street in Boston in the fourth quarter of 2007, as well as the
reclassification of Four Allen Center in Houston to operating in 2008.
 37




---



##### 



(Millions)
    
    2008
    
    
    2007
    
    
    2006Total revenue
    
    $
    2,805
    
    
    $
    2,842
    
    
    $
    1,823Net operating incomeCommercial property operationsOperating income from commercial properties
    
    
    1,328
    
    
    
    1,256
    
    
    
    795Lease termination, non-recurring fee and other income
    
    
    
    
    
    
    4
    
    
    
    5Total commercial property operations
    
    
    1,328
    
    
    
    1,260
    
    
    
    800Residential development operations
    
    
    144
    
    
    
    237
    
    
    
    144Interest and other income
    
    
    52
    
    
    
    44
    
    
    
    441,524
    
    
    
    1,541
    
    
    
    988ExpensesInterestCommercial property debt
    
    
    637
    
    
    
    673
    
    
    
    408Capital securities  corporate
    
    
    57
    
    
    
    61
    
    
    
    53Capital securities  fund subsidiaries
    
    
    (70
    )
    
    
    (27
    )
    
    
    (12
    )General and administrative
    
    
    103
    
    
    
    103
    
    
    
    67Non-controlling interestsFund subsidiaries
    
    
    (22
    )
    
    
    (75
    )
    
    
    (21
    )Other subsidiaries
    
    
    20
    
    
    
    23
    
    
    
    19Depreciation and amortization
    
    
    545
    
    
    
    519
    
    
    
    257Future income taxes
    
    
    (429
    )
    
    
    69
    
    
    
    92Other
    
    
    (24
    )
    
    
    44
    
    
    
    15Net income from continuing operations
    
    
    707
    
    
    
    151
    
    
    
    110Discontinued operations(1)
    
    
    (7
    )
    
    
    89
    
    
    
    25Net income
    
    $
    700
    
    
    $
    240
    
    
    $
    135Net income per share  dilutedContinuing operations
    
    $
    1.79
    
    
    $
    0.36
    
    
    $
    0.30Discontinued operations
    
    
    (0.02
    )
    
    
    0.24
    
    
    
    0.07$
    1.77
    
    
    $
    0.60
    
    
    $
    0.37Funds from operations per share  dilutedContinuing operations
    
    $
    1.55
    
    
    $
    1.50
    
    
    $
    1.18Discontinued operations
    
    
    0.04
    
    
    
    0.07
    
    
    
    0.07$
    1.59
    
    
    $
    1.57
    
    
    $
    1.25
 (1)
    
    Refer to page 46 for further details on discontinued operations   (Millions, except per share amounts)
    
    2008
    
    
    2007
    
    
    2006Net income
    
    $
    700
    
    
    $
    240
    
    
    $
    135Preferred share dividends
    
    
    (3
    )
    
    
    (3
    )
    
    
    (3
    )Net income available to common shareholders
    
    $
    697
    
    
    $
    237
    
    
    $
    132Weighted average shares outstanding  basic
    
    
    392.3
    
    
    
    395.9
    
    
    
    348.6Net income per share  basic
    
    $
    1.77
    
    
    $
    0.60
    
    
    $
    0.38Weighted average shares outstanding  diluted
    
    
    393.2
    
    
    
    399.2
    
    
    
    353.0Net income per share  diluted
    
    $
    1.77
    
    
    $
    0.59
    
    
    $
    0.37Weighted average shares outstanding  basic
    
    
    392.3
    
    
    
    395.9
    
    
    
    348.6Unexercised options
    
    
    0.9
    
    
    
    3.3
    
    
    
    4.4Weighted average shares outstanding  diluted
    
    $
    393.2
    
    
    $
    399.2
    
    
    $
    353.0
 38




---



##### 



RECONCILIATION OF NET INCOME TO FUNDS FROM OPERATIONS
 (Millions)
    
    2008
    
    
    2007
    
    
    2006Net income
    
    $
    700
    
    
    $
    240
    
    
    $
    135Add (deduct) non-cash and certain non-recurring items:Depreciation and amortization
    
    
    545
    
    
    
    519
    
    
    
    257Income taxes
    
    
    (429
    )
    
    
    69
    
    
    
    92Discontinued operations(1)
    
    
    23
    
    
    
    (62
    )
    
    
    Non-controlling interests in above items(2)
    
    
    (189
    )
    
    
    (181
    )
    
    
    (56
    )Other(3)
    
    
    (24
    )
    
    
    44
    
    
    
    15Funds from operations
    
    $
    626
    
    
    $
    629
    
    
    $
    443
 (1)
    
    Represents depreciation and amortization, income taxes and dispositions related to
discontinued operations(2)
    
    Includes non-cash component of capital securities  fund subsidiaries of $93 million
(2007  $82 million)(3)
    
    Represents a foreign exchange gain in the current year of $24 million and
transaction costs in 2007 ($44 million) and 2006 ($15 million)  (Millions, except per share amounts)
    
    2008
    
    
    2007
    
    
    2006Funds from operations
    
    $
    626
    
    
    $
    629
    
    
    $
    443Preferred share dividends
    
    
    (3
    )
    
    
    (3
    )
    
    
    (3
    )623
    
    
    
    626
    
    
    
    440Funds from operations per share  diluted
    
    $
    1.59
    
    
    $
    1.57
    
    
    $
    1.25
 REVENUE
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Commercial property revenueRevenue from continuing operations
    
    $
    2,205
    
    
    $
    2,054
    
    
    $
    1,285Recurring fee income
    
    
    43
    
    
    
    40
    
    
    
    29Lease termination, non-recurring fee and other income
    
    
    
    
    
    
    4
    
    
    
    5Total commercial property revenue
    
    
    2,248
    
    
    
    2,098
    
    
    
    1,319Revenue from residential development operations
    
    
    505
    
    
    
    700
    
    
    
    460Revenue from commercial property and residential development operations
    
    
    2,753
    
    
    
    2,798
    
    
    
    1,779Interest and other
    
    
    52
    
    
    
    44
    
    
    
    44Total
    
    $
    2,805
    
    
    $
    2,842
    
    
    $
    1,823
 COMMERCIAL PROPERTY OPERATIONS
   (Millions)
    
    2008
    
    
    2007
    
    
    2006Commercial property revenueRevenue from current properties
    
    $
    2,031
    
    
    $
    1,870
    
    
    $
    1,225Straight-line rental income
    
    
    35
    
    
    
    47
    
    
    
    17Intangible lease amortization
    
    
    139
    
    
    
    137
    
    
    
    43Revenue from continuing operations
    
    
    2,205
    
    
    
    2,054
    
    
    
    1,285Recurring fee income
    
    
    43
    
    
    
    40
    
    
    
    29Lease termination, non-recurring fee and other income
    
    
    
    
    
    
    4
    
    
    
    5Total commercial property revenue
    
    
    2,248
    
    
    
    2,098
    
    
    
    1,319Property operating costs
    
    
    (920
    )
    
    
    (838
    )
    
    
    (519
    )Commercial property net operating income
    
    $
    1,328
    
    
    $
    1,260
    
    
    $
    800
 39




---



##### 



(Millions)
    
    2008
    
    
    2007
    
    
    2006DirectSame property
    
    $
    669
    
    
    $
    642
    
    
    $
    606Properties acquired since December 31, 2007
    
    
    38
    
    
    
    
    
    
    
    Recurring fee income
    
    
    33
    
    
    
    28
    
    
    
    21740
    
    
    
    670
    
    
    
    627U.S. Office FundSame property
    
    
    526
    
    
    
    543
    
    
    
    135Properties reclassified from redevelopment since December 31, 2007
    
    
    17
    
    
    
    
    
    
    
    Recurring fee income
    
    
    2
    
    
    
    3
    
    
    
    545
    
    
    
    546
    
    
    
    135Canadian Office FundSame property
    
    
    35
    
    
    
    35
    
    
    
    31Recurring fee income
    
    
    8
    
    
    
    9
    
    
    
    743
    
    
    
    44
    
    
    
    38Total commercial property net operating income
    
    $
    1,328
    
    
    $
    1,260
    
    
    $
    800
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Discontinued operationsRevenue
    
    $
    76
    
    
    $
    108
    
    
    $
    113Property operating expenses
    
    
    (41
    )
    
    
    (55
    )
    
    
    (69
    )Net operating income from discontinued operations
    
    $
    35
    
    
    $
    53
    
    
    $
    44
     40




---



##### 



Avg.
    
    
    Avg. In-Place
    
    
    Avg. MarketLeasable Area
    
    
    Lease Term
    
    
    Net Rent
    
    
    Net Rent(000s Sq. Ft.)
    
    
    (Years)
    
    
    ($ per Sq. Ft.)
    
    
    ($ per Sq. Ft.)New York, New YorkMidtown
    
    
    6,527
    
    
    
    10.7
    
    
    $
    37.34
    
    
    $
    68Downtown
    
    
    13,719
    
    
    
    7.9
    
    
    
    26.76
    
    
    
    37Boston, Massachusetts
    
    
    1,990
    
    
    
    5.8
    
    
    
    30.02
    
    
    
    30Washington, D.C.
    
    
    5,619
    
    
    
    6.5
    
    
    
    25.15
    
    
    
    35Houston, Texas
    
    
    8,280
    
    
    
    6.7
    
    
    
    12.73
    
    
    
    24Los Angeles, California
    
    
    8,624
    
    
    
    5.2
    
    
    
    20.90
    
    
    
    25Toronto, Ontario
    
    
    7,617
    
    
    
    6.2
    
    
    
    20.53
    
    
    
    22Calgary, Alberta
    
    
    5,681
    
    
    
    9.2
    
    
    
    23.67
    
    
    
    33Ottawa, Ontario
    
    
    1,750
    
    
    
    5.1
    
    
    
    14.87
    
    
    
    18Denver, Colorado
    
    
    1,324
    
    
    
    6.5
    
    
    
    17.31
    
    
    
    22Minneapolis, Minnesota
    
    
    2,530
    
    
    
    5.7
    
    
    
    9.85
    
    
    
    15Other
    
    
    1,253
    
    
    
    7.5
    
    
    
    11.72
    
    
    
    22Total(1)
    
    
    64,914
    
    
    
    6.9
    
    
    $
    22.72
    
    
    $
    32
 (1)
    
    Excludes developments   Dec. 31, 2008
    
    
    Dec. 31, 2007Leasable
    
    
    %
    
    
    Leasable
    
    
    %(Thousands of square feet)
    
    Sq. Ft.
    
    
    Leased
    
    
    Sq. Ft.
    
    
    LeasedNew York, New YorkMidtown
    
    
    6,527
    
    
    
    90.4
    
    
    
    6,298
    
    
    
    95.0Downtown
    
    
    13,719
    
    
    
    99.0
    
    
    
    12,901
    
    
    
    99.2Total New York, New York
    
    
    20,246
    
    
    
    96.2
    
    
    
    19,199
    
    
    
    97.8Boston, Massachusetts
    
    
    1,990
    
    
    
    94.3
    
    
    
    1,887
    
    
    
    96.5Washington, D.C.
    
    
    5,619
    
    
    
    93.3
    
    
    
    5,532
    
    
    
    92.5Houston, Texas
    
    
    8,280
    
    
    
    94.9
    
    
    
    7,012
    
    
    
    95.1Los Angeles, California
    
    
    8,624
    
    
    
    85.9
    
    
    
    8,533
    
    
    
    87.5Toronto, Ontario
    
    
    7,617
    
    
    
    97.8
    
    
    
    8,824
    
    
    
    97.9Calgary, Alberta
    
    
    5,681
    
    
    
    99.9
    
    
    
    5,681
    
    
    
    99.8Ottawa, Ontario
    
    
    1,750
    
    
    
    99.5
    
    
    
    1,750
    
    
    
    99.3Denver, Colorado
    
    
    1,324
    
    
    
    97.7
    
    
    
    1,292
    
    
    
    97.5Minneapolis, Minnesota
    
    
    2,530
    
    
    
    92.6
    
    
    
    2,487
    
    
    
    92.4Other
    
    
    1,253
    
    
    
    98.3
    
    
    
    1,400
    
    
    
    94.9Total(1)
    
    
    64,914
    
    
    
    94.9
    
    
    
    63,597
    
    
    
    95.6
 (1)
    
    Excludes developments  41




---



##### 



Dec. 31, 2007
    
    
    
    Activities During the Year Ended December 31, 2008
    
    
    
    Dec. 31, 2008Average
    
    
    
    
    
    
    Year One
    
    
    AverageExpiring
    
    
    
    
    
    
    Leasing
    
    
    Leasing
    
    
    Acq./Leasable
    
    
    Leased
    
    
    
    Expiries
    
    
    Net Rent
    
    
    Leasing
    
    
    Net Rent
    
    
    Net Rent
    
    
    (Disp.)
    
    
    
    Leasable
    
    
    Leased(Square feet in 000s)
    
    Sq. Ft(1,2)
    
    
    Sq. Ft.(1,2)
    
    
    
    Sq. Ft.(1)
    
    
    ($ per sq. ft.)
    
    
    Sq. Ft.(1)
    
    
    ($ per sq. ft.)
    
    
    ($ per sq. ft.)
    
    
    Sq. Ft.(1,3)
    
    
    
    Sq. Ft.(1)
    
    
    Sq. Ft.(1)New York, New YorkMidtown
    
    
    6,527
    
    
    
    6,214
    
    
    
    
    (555
    )
    
    $
    33.59
    
    
    
    241
    
    
    $
    78.06
    
    
    $
    80.58
    
    
    
    
    
    
    
    
    6,527
    
    
    
    5,900Downtown
    
    
    13,719
    
    
    
    13,638
    
    
    
    
    (302
    )
    
    
    25.85
    
    
    
    242
    
    
    
    30.08
    
    
    
    32.61
    
    
    
    
    
    
    
    
    13,719
    
    
    
    13,578Boston, Massachusetts
    
    
    1,990
    
    
    
    1,921
    
    
    
    
    (130
    )
    
    
    33.05
    
    
    
    86
    
    
    
    38.37
    
    
    
    40.01
    
    
    
    
    
    
    
    
    1,990
    
    
    
    1,877Washington, D.C.
    
    
    5,619
    
    
    
    5,179
    
    
    
    
    (622
    )
    
    
    21.86
    
    
    
    683
    
    
    
    26.71
    
    
    
    27.77
    
    
    
    
    
    
    
    
    5,619
    
    
    
    5,240Houston, Texas
    
    
    7,013
    
    
    
    6,665
    
    
    
    
    (1,370
    )
    
    
    11.97
    
    
    
    1,293
    
    
    
    15.56
    
    
    
    16.07
    
    
    
    1,267
    
    
    
    
    8,280
    
    
    
    7,855Los Angeles, California
    
    
    8,624
    
    
    
    7,536
    
    
    
    
    (1,187
    )
    
    
    18.83
    
    
    
    1,058
    
    
    
    23.36
    
    
    
    26.43
    
    
    
    
    
    
    
    
    8,624
    
    
    
    7,407Toronto, Ontario
    
    
    8,824
    
    
    
    8,637
    
    
    
    
    (856
    )
    
    
    19.80
    
    
    
    872
    
    
    
    24.78
    
    
    
    25.41
    
    
    
    (1,200
    )
    
    
    
    7,617
    
    
    
    7,453Calgary, Alberta
    
    
    5,681
    
    
    
    5,667
    
    
    
    
    (2,190
    )
    
    
    17.03
    
    
    
    2,197
    
    
    
    25.49
    
    
    
    26.97
    
    
    
    
    
    
    
    
    5,681
    
    
    
    5,674Ottawa, Ontario
    
    
    1,750
    
    
    
    1,739
    
    
    
    
    (75
    )
    
    
    12.18
    
    
    
    78
    
    
    
    17.14
    
    
    
    17.24
    
    
    
    
    
    
    
    
    1,750
    
    
    
    1,742Denver, Colorado
    
    
    1,324
    
    
    
    1,291
    
    
    
    
    (26
    )
    
    
    17.05
    
    
    
    28
    
    
    
    22.36
    
    
    
    23.01
    
    
    
    
    
    
    
    
    1,324
    
    
    
    1,293Minneapolis, Minnesota
    
    
    2,530
    
    
    
    2,345
    
    
    
    
    (227
    )
    
    
    5.95
    
    
    
    224
    
    
    
    7.41
    
    
    
    8.43
    
    
    
    
    
    
    
    
    2,530
    
    
    
    2,342Other
    
    
    1,402
    
    
    
    1,329
    
    
    
    
    (97
    )
    
    
    10.02
    
    
    
    100
    
    
    
    20.59
    
    
    
    21.14
    
    
    
    (100
    )
    
    
    
    1,253
    
    
    
    1,232Total(1)
    
    
    65,003
    
    
    
    62,161
    
    
    
    
    (7,637
    )
    
    $
    18.50
    
    
    
    7,102
    
    
    $
    24.74
    
    
    $
    26.16
    
    
    
    (33
    )
    
    
    
    64,914
    
    
    
    61,593
 (1)
    
    Excludes developments(2)
    
    Restated for remeasurements performed during the first quarter of 2008(3)
    
    Reclassified 1,267,000 square feet from development properties to commercial
properties in connection with Four Allen Center in Houston Acquisitions
  Recurring fee income
   (Millions)
    
    2008
    
    
    2007
    
    
    2006Property management, leasing, project management and other fees
    
    $
    20
    
    
    $
    20
    
    
    $
    13Brookfield Residential Services Ltd. fees
    
    
    20
    
    
    
    17
    
    
    
    13Brookfield LePage Johnson Controls
    
    
    3
    
    
    
    3
    
    
    
    3Total
    
    $
    43
    
    
    $
    40
    
    
    $
    29
  42




---



##### 



RESIDENTIAL DEVELOPMENT OPERATIONS
    (Millions)
    
    2008
    
    
    2007
    
    
    2006Sales revenue
    
    $
    505
    
    
    $
    700
    
    
    $
    460Operating costs
    
    
    (361
    )
    
    
    (463
    )
    
    
    (316
    )Total
    
    $
    144
    
    
    $
    237
    
    
    $
    144
  Lot Sales
    
    
    
    Lot Sales Revenue
    
    
    
    Average Lot Sales Revenue(Units/Acres)
    
    
    


    (Millions)

    
    
    
    (Thousands)2008
    
    
    2007
    
    
    2006
    
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    
    2008
    
    
    2007
    
    
    2006Single Family (Lots)Alberta
    
    
    1,173
    
    
    
    1,711
    
    
    
    2,231
    
    
    
    $
    192
    
    
    $
    257
    
    
    $
    244
    
    
    
    $
    157
    
    
    $
    152
    
    
    $
    110Ontario
    
    
    124
    
    
    
    152
    
    
    
    
    
    
    
    
    14
    
    
    
    18
    
    
    
    
    
    
    
    
    116
    
    
    
    117
    
    
    
    Colorado
    
    
    98
    
    
    
    123
    
    
    
    96
    
    
    
    
    12
    
    
    
    13
    
    
    
    6
    
    
    
    
    118
    
    
    
    107
    
    
    
    63Texas
    
    
    
    
    
    
    102
    
    
    
    55
    
    
    
    
    
    
    
    
    4
    
    
    
    2
    
    
    
    
    
    
    
    
    43
    
    
    
    36Missouri
    
    
    4
    
    
    
    1
    
    
    
    64
    
    
    
    
    
    
    
    
    
    
    
    
    2
    
    
    
    
    72
    
    
    
    100
    
    
    
    31Total Single Family (Lots)
    
    
    1,399
    
    
    
    2,089
    
    
    
    2,446
    
    
    
    
    218
    
    
    
    292
    
    
    
    254Total Single Family (Acre Equivalent)(1)
    
    
    214
    
    
    
    345
    
    
    
    384Multi-Family, Commercial and Industrial (Acres)Alberta
    
    
    47
    
    
    
    85
    
    
    
    63
    
    
    
    
    45
    
    
    
    112
    
    
    
    33
    
    
    
    
    209
    
    
    
    192
    
    
    
    131Ontario
    
    
    295
    
    
    
    
    
    
    
    
    
    
    
    
    19
    
    
    
    
    
    
    
    
    
    
    
    
    64
    
    
    
    
    
    
    
    Total Land Sales Revenue
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    282
    
    
    $
    404
    
    
    $
    287
 (1)
    
    Represents lots converted to acres based on a conversion factor of four to seven
lots per acre depending on region
  Home Sales
    
    
    
    Home Sales Revenue
    
    
    
    Average Home Sales Revenue(Units/Acres)
    
    
    
    (Millions)
    
    
    
    (Thousands)2008
    
    
    2007
    
    
    2006
    
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    
    2008
    
    
    2007
    
    
    2006Single FamilyAlberta
    
    
    245
    
    
    
    441
    
    
    
    341
    
    
    
    $
    77
    
    
    $
    124
    
    
    $
    64
    
    
    
    $
    313
    
    
    $
    279
    
    
    $
    187Ontario
    
    
    305
    
    
    
    248
    
    
    
    280
    
    
    
    
    88
    
    
    
    73
    
    
    
    73
    
    
    
    
    290
    
    
    
    296
    
    
    
    281550
    
    
    
    689
    
    
    
    621
    
    
    
    
    165
    
    
    
    197
    
    
    
    137Multi-FamilyAlberta
    
    
    195
    
    
    
    332
    
    
    
    197
    
    
    
    
    58
    
    
    
    92
    
    
    
    36
    
    
    
    
    297
    
    
    
    277
    
    
    
    184Ontario
    
    
    
    
    
    
    29
    
    
    
    
    
    
    
    
    
    
    
    
    7
    
    
    
    
    
    
    
    
    
    
    
    
    247
    
    
    
    224Total
    
    
    745
    
    
    
    1,050
    
    
    
    818
    
    
    
    $
    223
    
    
    $
    296
    
    
    $
    173
  INTEREST AND OTHER INCOME
  43




---



##### 



INTEREST EXPENSECommercial property debt
  Capital securities  corporate
  Capital securities  fund subsidiaries
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Interest on debt securities
    
    $
    (13
    )
    
    $
    26
    
    
    $
    7Interest on redeemable equity interests
    
    
    36
    
    
    
    29
    
    
    
    423
    
    
    
    55
    
    
    
    11Non-cash component(1)
    
    
    (93
    )
    
    
    (82
    )
    
    
    (23
    )Total
    
    $
    (70
    )
    
    $
    (27
    )
    
    $
    (12
    )
 (1)
    
    Represents co-investors share of non-cash items, such as depreciation and
amortization
  GENERAL AND ADMINISTRATIVE EXPENSES
  NON-CONTROLLING INTERESTSFund subsidiaries
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Non-controlling interests
    
    $
    74
    
    
    $
    62
    
    
    $
    1Non-cash component(1)
    
    
    (96
    )
    
    
    (111
    )
    
    
    (22
    )Total non-controlling interests  fund subsidiaries
    
    $
    (22
    )
    
    $
    (49
    )
    
    $
    (21
    )
 (1)
    
    Represents co-investors share of non-cash items, such as depreciation and
amortization
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Non-controlling interests  fund subsidiaries  continuing operations
    
    $
    (22
    )
    
    $
    (75
    )
    
    $
    (21
    )Non-controlling interests  fund subsidiaries  discontinued operations
    
    
    
    
    
    
    26
    
    
    
    Total non-controlling interests  fund subsidiaries
    
    $
    (22
    )
    
    $
    (49
    )
    
    $
    (21
    )
 44




---



##### 



Other subsidiaries
    (Millions)
    
    
    Type
    
    2008
    
    
    2007
    
    
    2006BPO Properties
    
    Redeemable preferred shares(1)
    
    $
    13
    
    
    $
    15
    
    
    $
    14BPO Properties
    
    Participating interests
    
    
    7
    
    
    
    14
    
    
    
    6Brookfield Financial Properties
    
    Participating interests
    
    
    
    
    
    
    1
    
    
    
    1Total
    
    
    
    $
    20
    
    
    $
    30
    
    
    $
    21
 (1)
    
    Non-participating
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Non-controlling interests  other subsidiaries  continuing operations
    
    $
    20
    
    
    $
    23
    
    
    $
    19Non-controlling interests  other subsidiaries  discontinued operations
    
    
    
    
    
    
    7
    
    
    
    2Total non-controlling interests  other subsidiaries
    
    $
    20
    
    
    $
    30
    
    
    $
    21
 DEPRECIATION AND AMORTIZATION EXPENSE
  FUTURE INCOME TAXES
    OTHER
   45




---



##### 



DISCONTINUED OPERATIONS
     (Millions)
    
    2008
    
    
    2007
    
    
    2006Revenue
    
    $
    76
    
    
    $
    108
    
    
    $
    113Operating expenses
    
    
    (41
    )
    
    
    (55
    )
    
    
    (69
    )35
    
    
    
    53
    
    
    
    44Interest expense
    
    
    (19
    )
    
    
    (26
    )
    
    
    (19
    )Funds from operations
    
    
    16
    
    
    
    27
    
    
    
    25Depreciation and amortization
    
    
    (10
    )
    
    
    (15
    )
    
    
    (27
    )Income from discontinued operations before gains, non-controlling interests and taxes
    
    
    6
    
    
    
    12
    
    
    
    (2
    )Gain on sale of commercial properties
    
    
    164
    
    
    
    144
    
    
    
    44Impairment loss
    
    
    (147
    )
    
    
    
    
    
    
    Non-controlling interests
    
    
    
    
    
    
    (33
    )
    
    
    (2
    )Future income taxes
    
    
    (30
    )
    
    
    (34
    )
    
    
    (15
    )Income from discontinued operations
    
    $
    (7
    )
    
    $
    89
    
    
    $
    25
 46




---



##### 



SEGMENTED INFORMATION
  Commercial
    
    
    
    ResidentialUnited States
    
    
    
    Canada
    
    
    
    Development
    
    
    
    Total(Millions)
    
    2008
    
    
    2007
    
    
    
    2008
    
    
    2007
    
    
    
    2008
    
    
    2007
    
    
    
    2008
    
    
    2007AssetsCommercial properties
    
    $
    13,147
    
    
    $
    13,498
    
    
    
    $
    1,754
    
    
    $
    2,391
    
    
    
    $
    
    
    
    $
    
    
    
    
    $
    14,901
    
    
    $
    15,889Development properties
    
    
    624
    
    
    
    676
    
    
    
    
    601
    
    
    
    496
    
    
    
    
    1,196
    
    
    
    1,228
    
    
    
    
    2,421
    
    
    
    2,400Receivables and other
    
    
    562
    
    
    
    569
    
    
    
    
    132
    
    
    
    195
    
    
    
    
    241
    
    
    
    292
    
    
    
    
    935
    
    
    
    1,056Intangible assets
    
    
    612
    
    
    
    719
    
    
    
    
    25
    
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    
    
    637
    
    
    
    759Restricted cash and deposits
    
    
    112
    
    
    
    146
    
    
    
    
    2
    
    
    
    2
    
    
    
    
    2
    
    
    
    3
    
    
    
    
    116
    
    
    
    151Cash and cash equivalents
    
    
    97
    
    
    
    134
    
    
    
    
    59
    
    
    
    74
    
    
    
    
    1
    
    
    
    6
    
    
    
    
    157
    
    
    
    214Assets related to discontinued operations
    
    
    290
    
    
    
    
    
    
    
    
    
    
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    
    
    290
    
    
    
    4Total
    
    $
    15,444
    
    
    $
    15,742
    
    
    
    $
    2,573
    
    
    $
    3,202
    
    
    
    $
    1,440
    
    
    $
    1,529
    
    
    
    $
    19,457
    
    
    $
    20,473Commercial
    
    
    
    ResidentialUnited States
    
    
    
    Canada
    
    
    
    Development
    
    
    
    Total(Millions)
    
    2008
    
    
    2007
    
    
    
    2008
    
    
    2007
    
    
    
    2008
    
    
    2007
    
    
    
    2008
    
    
    2007Revenues
    
    $
    1,809
    
    
    $
    1,684
    
    
    
    $
    439
    
    
    $
    414
    
    
    
    $
    505
    
    
    $
    700
    
    
    
    $
    2,753
    
    
    $
    2,798Expenses
    
    
    737
    
    
    
    667
    
    
    
    
    183
    
    
    
    171
    
    
    
    
    361
    
    
    
    463
    
    
    
    
    1,281
    
    
    
    1,3011,072
    
    
    
    1,017
    
    
    
    
    256
    
    
    
    243
    
    
    
    
    144
    
    
    
    237
    
    
    
    
    1,472
    
    
    
    1,497Interest and other income
    
    
    21
    
    
    
    18
    
    
    
    
    20
    
    
    
    14
    
    
    
    
    11
    
    
    
    12
    
    
    
    
    52
    
    
    
    44Net operating income from continuing operations
    
    
    1,093
    
    
    
    1,035
    
    
    
    
    276
    
    
    
    257
    
    
    
    
    155
    
    
    
    249
    
    
    
    
    1,524
    
    
    
    1,541Interest expenseCommercial property debt
    
    
    589
    
    
    
    639
    
    
    
    
    48
    
    
    
    34
    
    
    
    
    
    
    
    
    
    
    
    
    
    637
    
    
    
    673Capital securities  corporate
    
    
    9
    
    
    
    9
    
    
    
    
    48
    
    
    
    52
    
    
    
    
    
    
    
    
    
    
    
    
    
    57
    
    
    
    61Capital securities  fund subsidiaries
    
    
    (70
    )
    
    
    (27
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (70
    )
    
    
    (27
    )General and administrative
    
    
    57
    
    
    
    58
    
    
    
    
    46
    
    
    
    45
    
    
    
    
    
    
    
    
    
    
    
    
    
    103
    
    
    
    103Transaction costs
    
    
    
    
    
    
    40
    
    
    
    
    
    
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    44Non-controlling interestsFund subsidiaries
    
    
    (22
    )
    
    
    (75
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (22
    )
    
    
    (75
    )Other subsidiaries
    
    
    
    
    
    
    1
    
    
    
    
    20
    
    
    
    22
    
    
    
    
    
    
    
    
    
    
    
    
    
    20
    
    
    
    23Depreciation and amortization
    
    
    476
    
    
    
    458
    
    
    
    
    69
    
    
    
    61
    
    
    
    
    
    
    
    
    
    
    
    
    
    545
    
    
    
    519Income before unallocated costs
    
    
    54
    
    
    
    (68
    )
    
    
    
    45
    
    
    
    39
    
    
    
    
    155
    
    
    
    249
    
    
    
    
    254
    
    
    
    220Future income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (429
    )
    
    
    69Other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (24
    )
    
    
    Net income from continuing operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    707
    
    
    
    151Discontinued operations
    
    
    (129
    )
    
    
    21
    
    
    
    
    122
    
    
    
    68
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7
    )
    
    
    89Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    700
    
    
    $
    240
 47




---



##### 



QUARTERLY RESULTS
 2008
    
    
    
    2007(Millions, except per share amounts)
    
    Q4
    
    
    Q3
    
    
    Q2
    
    
    Q1
    
    
    
    Q4
    
    
    Q3
    
    
    Q2
    
    
    Q1(1)Total Revenue
    
    $
    723
    
    
    $
    715
    
    
    $
    716
    
    
    $
    651
    
    
    
    $
    830
    
    
    $
    687
    
    
    $
    705
    
    
    $
    620Net operating incomeCommercial property operations
    
    
    322
    
    
    
    325
    
    
    
    341
    
    
    
    340
    
    
    
    
    318
    
    
    
    321
    
    
    
    317
    
    
    
    304Residential development operations
    
    
    46
    
    
    
    45
    
    
    
    35
    
    
    
    18
    
    
    
    
    80
    
    
    
    43
    
    
    
    72
    
    
    
    42Interest and other
    
    
    12
    
    
    
    14
    
    
    
    16
    
    
    
    10
    
    
    
    
    12
    
    
    
    13
    
    
    
    10
    
    
    
    9380
    
    
    
    384
    
    
    
    392
    
    
    
    368
    
    
    
    
    410
    
    
    
    377
    
    
    
    399
    
    
    
    355ExpensesInterestCommercial property debt
    
    
    163
    
    
    
    161
    
    
    
    151
    
    
    
    162
    
    
    
    
    168
    
    
    
    171
    
    
    
    167
    
    
    
    167Capital securities  corporate
    
    
    12
    
    
    
    15
    
    
    
    15
    
    
    
    15
    
    
    
    
    15
    
    
    
    15
    
    
    
    16
    
    
    
    15Capital securities  fund subsidiaries
    
    
    (53
    )
    
    
    (5
    )
    
    
    (4
    )
    
    
    (8
    )
    
    
    
    (5
    )
    
    
    (8
    )
    
    
    (5
    )
    
    
    (9
    )General and administrative
    
    
    19
    
    
    
    25
    
    
    
    30
    
    
    
    29
    
    
    
    
    27
    
    
    
    23
    
    
    
    24
    
    
    
    29Non-controlling interestsFund subsidiaries
    
    
    (7
    )
    
    
    (10
    )
    
    
    (3
    )
    
    
    (2
    )
    
    
    
    (22
    )
    
    
    (12
    )
    
    
    (31
    )
    
    
    (10
    )Other subsidiaries
    
    
    4
    
    
    
    4
    
    
    
    6
    
    
    
    6
    
    
    
    
    7
    
    
    
    6
    
    
    
    6
    
    
    
    4Depreciation and amortization
    
    
    148
    
    
    
    128
    
    
    
    134
    
    
    
    135
    
    
    
    
    134
    
    
    
    132
    
    
    
    132
    
    
    
    121Future income taxes
    
    
    (479
    )
    
    
    20
    
    
    
    21
    
    
    
    9
    
    
    
    
    4
    
    
    
    19
    
    
    
    28
    
    
    
    18Other
    
    
    (24
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2
    
    
    
    35
    
    
    
    3
    
    
    
    4Net income from continuing operations
    
    $
    597
    
    
    $
    46
    
    
    $
    42
    
    
    $
    22
    
    
    
    $
    80
    
    
    $
    (4
    )
    
    $
    59
    
    
    $
    16Discontinued operations(2)
    
    
    (139
    )
    
    
    128
    
    
    
    3
    
    
    
    1
    
    
    
    
    25
    
    
    
    7
    
    
    
    20
    
    
    
    37Net income
    
    $
    458
    
    
    $
    174
    
    
    $
    45
    
    
    $
    23
    
    
    
    $
    105
    
    
    $
    3
    
    
    $
    79
    
    
    $
    53Net income per share  basicContinuing operations
    
    $
    1.50
    
    
    $
    0.12
    
    
    $
    0.11
    
    
    $
    0.06
    
    
    
    $
    0.20
    
    
    $
    (0.02
    )
    
    $
    0.16
    
    
    $
    0.04Discontinued operations(2)
    
    
    (0.34
    )
    
    
    0.32
    
    
    
    
    
    
    
    
    
    
    
    
    0.07
    
    
    
    0.02
    
    
    
    0.04
    
    
    
    0.09$
    1.16
    
    
    $
    0.44
    
    
    $
    0.11
    
    
    $
    0.06
    
    
    
    $
    0.27
    
    
    $
    
    
    
    $
    0.20
    
    
    $
    0.13Net income per share  dilutedContinuing operations
    
    $
    1.50
    
    
    $
    0.12
    
    
    $
    0.11
    
    
    $
    0.06
    
    
    
    $
    0.20
    
    
    $
    (0.02
    )
    
    $
    0.15
    
    
    $
    0.04Discontinued operations(2)
    
    
    (0.34
    )
    
    
    0.32
    
    
    
    
    
    
    
    
    
    
    
    
    0.07
    
    
    
    0.02
    
    
    
    0.04
    
    
    
    0.09$
    1.16
    
    
    $
    0.44
    
    
    $
    0.11
    
    
    $
    0.06
    
    
    
    $
    0.27
    
    
    $
    
    
    
    $
    0.19
    
    
    $
    0.13Funds from operations per share  dilutedContinuing operations
    
    $
    0.48
    
    
    $
    0.37
    
    
    $
    0.39
    
    
    $
    0.31
    
    
    
    $
    0.45
    
    
    $
    0.34
    
    
    $
    0.41
    
    
    $
    0.30Discontinued operations(2)
    
    
    0.01
    
    
    
    0.01
    
    
    
    0.01
    
    
    
    0.01
    
    
    
    
    0.02
    
    
    
    0.02
    
    
    
    0.01
    
    
    
    0.02$
    0.49
    
    
    $
    0.38
    
    
    $
    0.40
    
    
    $
    0.32
    
    
    
    $
    0.47
    
    
    $
    0.36
    
    
    $
    0.42
    
    
    $
    0.32
 (1)
    
    Per share amounts restated to include the effect of the three-for-two common stock
split effective May 4, 2007(2)
    
    All quarters presented are net of non-controlling interests
    48




---



##### 



PART III  U.S. OFFICE FUND SUPPLEMENTAL INFORMATION
   BrookfieldBrookfield
    
    
    Other
    
    
    PropertiesNumber
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Owned
    
    
    Properties
    
    
    Share-
    
    
    Netof
    
    
    Leased
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    Interest
    
    
    Owned
    
    
    holders
    
    
    Owned(Square feet in 000s)
    
    Properties
    
    
    %
    
    
    Office
    
    
    Retail
    
    
    Leasable
    
    
    Parking
    
    
    Area
    
    
    %
    
    
    Interest(1)
    
    
    Interests
    
    
    InterestNew YorkThe Grace Building
    
    
    1
    
    
    
    94.5
    
    
    
    1,537
    
    
    
    20
    
    
    
    1,557
    
    
    
    
    
    
    
    1,557
    
    
    
    49.9
    
    
    
    777
    
    
    
    (426
    )
    
    
    351One New York Plaza
    
    
    1
    
    
    
    99.0
    
    
    
    2,554
    
    
    
    31
    
    
    
    2,585
    
    
    
    
    
    
    
    2,585
    
    
    
    100
    
    
    
    2,585
    
    
    
    (1,416
    )
    
    
    1,169Newport Tower
    
    
    1
    
    
    
    96.2
    
    
    
    1,059
    
    
    
    41
    
    
    
    1,100
    
    
    
    
    
    
    
    1,100
    
    
    
    100
    
    
    
    1,100
    
    
    
    (603
    )
    
    
    4971065 Avenue of the Americas
    
    
    1
    
    
    
    66.3
    
    
    
    642
    
    
    
    40
    
    
    
    682
    
    
    
    
    
    
    
    682
    
    
    
    99
    
    
    
    675
    
    
    
    (370
    )
    
    
    3051411 Broadway
    
    
    1
    
    
    
    80.5
    
    
    
    1,149
    
    
    
    38
    
    
    
    1,187
    
    
    
    36
    
    
    
    1,223
    
    
    
    49.9
    
    
    
    610
    
    
    
    (334
    )
    
    
    2761460 Broadway
    
    
    1
    
    
    
    100.0
    
    
    
    211
    
    
    
    9
    
    
    
    220
    
    
    
    
    
    
    
    220
    
    
    
    49.9
    
    
    
    110
    
    
    
    (60
    )
    
    
    506
    
    
    
    91.6
    
    
    
    7,152
    
    
    
    179
    
    
    
    7,331
    
    
    
    36
    
    
    
    7,367
    
    
    
    
    
    
    
    5,857
    
    
    
    (3,209
    )
    
    
    2,648Washington, DC1200 K Street
    
    
    1
    
    
    
    97.6
    
    
    
    366
    
    
    
    24
    
    
    
    390
    
    
    
    44
    
    
    
    434
    
    
    
    100
    
    
    
    434
    
    
    
    (238
    )
    
    
    1961250 23rd Street
    
    
    1
    
    
    
    
    
    
    
    128
    
    
    
    
    
    
    
    128
    
    
    
    16
    
    
    
    144
    
    
    
    100
    
    
    
    144
    
    
    
    (79
    )
    
    
    651250 Connecticut Avenue
    
    
    1
    
    
    
    98.5
    
    
    
    163
    
    
    
    21
    
    
    
    184
    
    
    
    26
    
    
    
    210
    
    
    
    100
    
    
    
    210
    
    
    
    (115
    )
    
    
    951400 K Street
    
    
    1
    
    
    
    100.0
    
    
    
    178
    
    
    
    12
    
    
    
    190
    
    
    
    34
    
    
    
    224
    
    
    
    100
    
    
    
    224
    
    
    
    (123
    )
    
    
    1012000 L Street
    
    
    1
    
    
    
    90.5
    
    
    
    308
    
    
    
    75
    
    
    
    383
    
    
    
    
    
    
    
    383
    
    
    
    100
    
    
    
    383
    
    
    
    (210
    )
    
    
    1732001 M Street
    
    
    1
    
    
    
    98.9
    
    
    
    190
    
    
    
    39
    
    
    
    229
    
    
    
    35
    
    
    
    264
    
    
    
    98
    
    
    
    259
    
    
    
    (142
    )
    
    
    1172401 Pennsylvania Avenue
    
    
    1
    
    
    
    86.9
    
    
    
    58
    
    
    
    19
    
    
    
    77
    
    
    
    16
    
    
    
    93
    
    
    
    100
    
    
    
    93
    
    
    
    (51
    )
    
    
    42Bethesda Crescent
    
    
    3
    
    
    
    99.9
    
    
    
    241
    
    
    
    27
    
    
    
    268
    
    
    
    68
    
    
    
    336
    
    
    
    100
    
    
    
    336
    
    
    
    (184
    )
    
    
    152One Reston Crescent
    
    
    1
    
    
    
    100.0
    
    
    
    185
    
    
    
    
    
    
    
    185
    
    
    
    
    
    
    
    185
    
    
    
    100
    
    
    
    185
    
    
    
    (101
    )
    
    
    84Silver Spring Metro Plaza
    
    
    3
    
    
    
    94.0
    
    
    
    640
    
    
    
    47
    
    
    
    687
    
    
    
    84
    
    
    
    771
    
    
    
    100
    
    
    
    771
    
    
    
    (422
    )
    
    
    349Sunrise Tech Park
    
    
    4
    
    
    
    95.8
    
    
    
    315
    
    
    
    1
    
    
    
    316
    
    
    
    
    
    
    
    316
    
    
    
    100
    
    
    
    316
    
    
    
    (173
    )
    
    
    143Two Ballston Plaza
    
    
    1
    
    
    
    97.5
    
    
    
    204
    
    
    
    19
    
    
    
    223
    
    
    
    
    
    
    
    223
    
    
    
    100
    
    
    
    223
    
    
    
    (122
    )
    
    
    101Victor Building
    
    
    1
    
    
    
    73.1
    
    
    
    302
    
    
    
    45
    
    
    
    347
    
    
    
    
    
    
    
    347
    
    
    
    49.9
    
    
    
    173
    
    
    
    (95
    )
    
    
    781550 & 1560 Wilson Blvd
    
    
    2
    
    
    
    87.1
    
    
    
    248
    
    
    
    35
    
    
    
    283
    
    
    
    76
    
    
    
    359
    
    
    
    100
    
    
    
    359
    
    
    
    (197
    )
    
    
    16222
    
    
    
    90.2
    
    
    
    3,526
    
    
    
    364
    
    
    
    3,890
    
    
    
    399
    
    
    
    4,289
    
    
    
    
    
    
    
    4,110
    
    
    
    (2,252
    )
    
    
    1,858HoustonAllen CenterOne Allen Center
    
    
    1
    
    
    
    99.0
    
    
    
    914
    
    
    
    79
    
    
    
    993
    
    
    
    
    
    
    
    993
    
    
    
    100
    
    
    
    993
    
    
    
    (544
    )
    
    
    449Two Allen Center
    
    
    1
    
    
    
    98.8
    
    
    
    987
    
    
    
    9
    
    
    
    996
    
    
    
    
    
    
    
    996
    
    
    
    100
    
    
    
    996
    
    
    
    (546
    )
    
    
    450Three Allen Center
    
    
    1
    
    
    
    94.4
    
    
    
    1,173
    
    
    
    22
    
    
    
    1,195
    
    
    
    
    
    
    
    1,195
    
    
    
    100
    
    
    
    1,195
    
    
    
    (655
    )
    
    
    540Four Allen Center
    
    
    1
    
    
    
    100.0
    
    
    
    1,229
    
    
    
    38
    
    
    
    1,267
    
    
    
    
    
    
    
    1,267
    
    
    
    100
    
    
    
    1,267
    
    
    
    (697
    )
    
    
    570Cullen CenterContinental Center I
    
    
    1
    
    
    
    97.2
    
    
    
    1,048
    
    
    
    50
    
    
    
    1,098
    
    
    
    411
    
    
    
    1,509
    
    
    
    100
    
    
    
    1,509
    
    
    
    (826
    )
    
    
    683Continental Center II
    
    
    1
    
    
    
    83.8
    
    
    
    428
    
    
    
    21
    
    
    
    449
    
    
    
    81
    
    
    
    530
    
    
    
    100
    
    
    
    530
    
    
    
    (290
    )
    
    
    240KBR Tower
    
    
    1
    
    
    
    83.4
    
    
    
    985
    
    
    
    63
    
    
    
    1,048
    
    
    
    254
    
    
    
    1,302
    
    
    
    50
    
    
    
    651
    
    
    
    (357
    )
    
    
    294500 Jefferson Street
    
    
    1
    
    
    
    97.5
    
    
    
    351
    
    
    
    39
    
    
    
    390
    
    
    
    44
    
    
    
    434
    
    
    
    100
    
    
    
    434
    
    
    
    (237
    )
    
    
    1978
    
    
    
    94.9
    
    
    
    7,115
    
    
    
    321
    
    
    
    7,436
    
    
    
    790
    
    
    
    8,226
    
    
    
    
    
    
    
    7,575
    
    
    
    (4,152
    )
    
    
    3,423Los Angeles601 Figueroa
    
    
    1
    
    
    
    75.3
    
    
    
    1,037
    
    
    
    2
    
    
    
    1,039
    
    
    
    123
    
    
    
    1,162
    
    
    
    100
    
    
    
    1,162
    
    
    
    (636
    )
    
    
    526Bank of America Plaza
    
    
    1
    
    
    
    96.0
    
    
    
    1,383
    
    
    
    39
    
    
    
    1,422
    
    
    
    343
    
    
    
    1,765
    
    
    
    100
    
    
    
    1,765
    
    
    
    (967
    )
    
    
    798Ernst & Young Tower
    
    
    1
    
    
    
    84.0
    
    
    
    910
    
    
    
    335
    
    
    
    1,245
    
    
    
    391
    
    
    
    1,636
    
    
    
    100
    
    
    
    1,636
    
    
    
    (896
    )
    
    
    740Landmark Square
    
    
    1
    
    
    
    94.4
    
    
    
    420
    
    
    
    23
    
    
    
    443
    
    
    
    212
    
    
    
    655
    
    
    
    100
    
    
    
    655
    
    
    
    (359
    )
    
    
    296Marina Towers
    
    
    2
    
    
    
    94.7
    
    
    
    356
    
    
    
    25
    
    
    
    381
    
    
    
    87
    
    
    
    468
    
    
    
    50
    
    
    
    234
    
    
    
    (128
    )
    
    
    1065670 Wilshire Center
    
    
    1
    
    
    
    75.8
    
    
    
    409
    
    
    
    19
    
    
    
    428
    
    
    
    
    
    
    
    428
    
    
    
    100
    
    
    
    428
    
    
    
    (234
    )
    
    
    1946060 Center Drive
    
    
    1
    
    
    
    85.7
    
    
    
    253
    
    
    
    15
    
    
    
    268
    
    
    
    113
    
    
    
    381
    
    
    
    100
    
    
    
    381
    
    
    
    (209
    )
    
    
    1726080 Center Drive
    
    
    1
    
    
    
    96.0
    
    
    
    316
    
    
    
    
    
    
    
    316
    
    
    
    163
    
    
    
    479
    
    
    
    100
    
    
    
    479
    
    
    
    (263
    )
    
    
    2166100 Center Drive
    
    
    1
    
    
    
    97.0
    
    
    
    294
    
    
    
    
    
    
    
    294
    
    
    
    168
    
    
    
    462
    
    
    
    100
    
    
    
    462
    
    
    
    (253
    )
    
    
    209701 B Street
    
    
    1
    
    
    
    86.4
    
    
    
    512
    
    
    
    37
    
    
    
    549
    
    
    
    
    
    
    
    549
    
    
    
    100
    
    
    
    549
    
    
    
    (301
    )
    
    
    248707 Broadway
    
    
    1
    
    
    
    85.2
    
    
    
    183
    
    
    
    
    
    
    
    183
    
    
    
    128
    
    
    
    311
    
    
    
    100
    
    
    
    311
    
    
    
    (170
    )
    
    
    1419665 Wilshire Blvd
    
    
    1
    
    
    
    98.5
    
    
    
    171
    
    
    
    
    
    
    
    171
    
    
    
    64
    
    
    
    235
    
    
    
    100
    
    
    
    235
    
    
    
    (130
    )
    
    
    105Howard Hughes Spectrum
    
    
    1
    
    
    
    100.0
    
    
    
    37
    
    
    
    
    
    
    
    37
    
    
    
    
    
    
    
    37
    
    
    
    100
    
    
    
    37
    
    
    
    (20
    )
    
    
    17Howard Hughes Tower
    
    
    1
    
    
    
    49.5
    
    
    
    336
    
    
    
    2
    
    
    
    338
    
    
    
    141
    
    
    
    479
    
    
    
    100
    
    
    
    479
    
    
    
    (262
    )
    
    
    217Northpoint
    
    
    1
    
    
    
    75.9
    
    
    
    105
    
    
    
    
    
    
    
    105
    
    
    
    45
    
    
    
    150
    
    
    
    100
    
    
    
    150
    
    
    
    (82
    )
    
    
    68Arden Towers at Sorrento
    
    
    4
    
    
    
    79.5
    
    
    
    554
    
    
    
    54
    
    
    
    608
    
    
    
    
    
    
    
    608
    
    
    
    100
    
    
    
    608
    
    
    
    (333
    )
    
    
    275Westwood Center
    
    
    1
    
    
    
    89.7
    
    
    
    293
    
    
    
    25
    
    
    
    318
    
    
    
    
    
    
    
    318
    
    
    
    100
    
    
    
    318
    
    
    
    (174
    )
    
    
    144Wachovia Center
    
    
    1
    
    
    
    92.0
    
    
    
    465
    
    
    
    14
    
    
    
    479
    
    
    
    161
    
    
    
    640
    
    
    
    100
    
    
    
    640
    
    
    
    (351
    )
    
    
    28922
    
    
    
    85.9
    
    
    
    8,034
    
    
    
    590
    
    
    
    8,624
    
    
    
    2,139
    
    
    
    10,763
    
    
    
    
    
    
    
    10,529
    
    
    
    (5,768
    )
    
    
    4,761TOTAL COMMERCIAL
    
    
    58
    
    
    
    90.5
    
    
    
    25,827
    
    
    
    1,454
    
    
    
    27,281
    
    
    
    3,364
    
    
    
    30,645
    
    
    
    
    
    
    
    28,071
    
    
    
    (15,381
    )
    
    
    12,690
 (1)
    
    Represents the companys consolidated interest before non-controlling interests*
    
    Italic  Non-managed properties
 49




---



##### 



BrookfieldBrookfield
    
    
    
    
    
    
    PropertiesNumber
    
    
    
    
    
    
    Owned
    
    
    Properties
    
    
    Other
    
    
    Netof
    
    
    Total
    
    
    Interest
    
    
    Owned
    
    
    Shareholders
    
    
    Owned(Square feet in 000s)
    
    Sites
    
    
    Area
    
    
    %
    
    
    Interest(1)
    
    
    Interests
    
    
    InterestWashington, D.C.Reston Crescent
    
    
    1
    
    
    
    1,000
    
    
    
    100
    
    
    
    1,000
    
    
    
    (548
    )
    
    
    452Waterview
    
    
    1
    
    
    
    300
    
    
    
    25
    
    
    
    75
    
    
    
    (41
    )
    
    
    342
    
    
    
    1,300
    
    
    
    
    
    
    
    1,075
    
    
    
    (589
    )
    
    
    486Houston1500 Smith Street
    
    
    1
    
    
    
    500
    
    
    
    100
    
    
    
    500
    
    
    
    (274
    )
    
    
    226Allen Center Clay Street
    
    
    1
    
    
    
    600
    
    
    
    100
    
    
    
    600
    
    
    
    (329
    )
    
    
    271Five Allen Center
    
    
    1
    
    
    
    1,100
    
    
    
    100
    
    
    
    1,100
    
    
    
    (601
    )
    
    
    4993
    
    
    
    2,200
    
    
    
    2,200
    
    
    
    (1,204
    )
    
    
    996TOTAL DEVELOPMENT
    
    
    5
    
    
    
    3,500
    
    
    
    3,275
    
    
    
    (1,793
    )
    
    
    1,482REDEVELOPMENT1225 Connecticut Avenue, Washington, D.C.
    
    
    1
    
    
    
    269
    
    
    
    100
    
    
    
    269
    
    
    
    (147
    )
    
    
    122TOTAL DEVELOPMENT AND REDEVELOPMENT
    
    
    6
    
    
    
    3,769
    
    
    
    
    
    
    
    3,544
    
    
    
    (1,940
    )
    
    
    1,604
 (1)
    
    Represents the companys consolidated interest before non-controlling
interests
   Funds from Operations(Millions)
    
    Balance Sheet
    
    
    2008
    
    
    2007Midtown New York, New York
    
    $
    1,243
    
    
    $
    77
    
    
    $
    86Downtown New York, New York
    
    
    1,278
    
    
    
    96
    
    
    
    99Washington, D.C.
    
    
    1,123
    
    
    
    90
    
    
    
    96Houston, Texas
    
    
    1,135
    
    
    
    97
    
    
    
    87Los Angeles, California
    
    
    2,616
    
    
    
    183
    
    
    
    1757,395
    
    
    
    543
    
    
    
    543Property management and leasing fee income
    
    
    
    
    
    
    2
    
    
    
    3Development properties
    
    
    267
    
    
    
    
    
    
    
    Total book value / Net operating income
    
    
    7,662
    
    
    
    545
    
    
    
    546Property specific and subsidiary debt / Interest expense
    
    
    (5,729
    )
    
    
    (301
    )
    
    
    (386
    )Partner capital(2)/ Interest expense and non-controlling interests
    
    
    (923
    )
    
    
    (97
    )
    
    
    (82
    )Total
    
    
    1,010
    
    
    
    147
    
    
    
    78Other assets (liabilities), net / Other income (expenses), net
    
    
    (195
    )
    
    
    8
    
    
    
    14Invested capital / Funds from operations(1)
    
    $
    815
    
    
    $
    155
    
    
    $
    92
 (1)
    
    Fees paid by the Fund to Brookfield Properties are eliminated on consolidation. For
the year ended December 31, 2008, a total of $32 million of fees were paid to Brookfield
Properties (2007  $31 million) which resulted in a reduction of non-controlling interests
expense of $20 million (2007  $19 million) representing the net fees earned from partners(2)
    
    Includes both debt and equity capital invested
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Commercial property revenueRevenue from current properties
    
    $
    793
    
    
    $
    759
    
    
    $
    174Straight-line rental income
    
    
    36
    
    
    
    40
    
    
    
    12Intangible amortization
    
    
    114
    
    
    
    122
    
    
    
    30Total commercial property revenue
    
    
    943
    
    
    
    921
    
    
    
    216Property operating costs
    
    
    (398
    )
    
    
    (375
    )
    
    
    (81
    )Commercial property net operating income
    
    $
    545
    
    
    $
    546
    
    
    $
    135
 50




---



##### 



SUMMARY OF INVESTMENT
  BrookfieldProperties
    
    
    
    
    
    
    
    
    
    
    Net BookNumber of
    
    
    Total Area
    
    
    Owned Interest
    
    
    Book Value
    
    
    Debt
    
    
    EquityRegion
    
    Properties
    
    
    (000s Sq. Ft.)
    
    
    (000s Sq. Ft.)(1)
    
    
    (Millions)
    
    
    (Millions)
    
    
    (Millions)Commercial PropertiesMidtown New York, New York
    
    
    4
    
    
    
    3,682
    
    
    
    2,172
    
    
    $
    1,243
    
    
    $
    311
    
    
    $
    932Downtown New York, New York
    
    
    2
    
    
    
    3,685
    
    
    
    3,685
    
    
    
    1,278
    
    
    
    397
    
    
    
    881Washington, D.C.
    
    
    22
    
    
    
    4,289
    
    
    
    4,110
    
    
    
    1,123
    
    
    
    366
    
    
    
    757Houston, Texas
    
    
    8
    
    
    
    8,226
    
    
    
    7,575
    
    
    
    1,135
    
    
    
    240
    
    
    
    895Los Angeles, California
    
    
    22
    
    
    
    10,763
    
    
    
    10,529
    
    
    
    2,616
    
    
    
    421
    
    
    
    2,195Corporate U.S. Fund debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,989
    
    
    
    (3,989
    )58
    
    
    
    30,645
    
    
    
    28,071
    
    
    $
    7,395
    
    
    $
    5,724
    
    
    $
    1,671Office development sites
    
    
    5
    
    
    
    3,500
    
    
    
    3,275
    
    
    
    116
    
    
    
    5
    
    
    
    111Redevelopment sites
    
    
    1
    
    
    
    269
    
    
    
    269
    
    
    
    151
    
    
    
    
    
    
    
    151Total
    
    
    64
    
    
    
    34,414
    
    
    
    31,615
    
    
    $
    7,662
    
    
    $
    5,729
    
    
    $
    1,933
 (1)
    
    Represents consolidated interest before non-controlling interests
  Brookfield PropertiesShare (Millions)Property
    
    Location
    
    Rate %
    
    
    Maturity Date

    
    Proportional(1)
    
    
    Consolidated
    
    
    Mortgage DetailsTwo Ballston Plaza
    
    Washington, D.C.
    
    
    6.91
    
    
    March
    2009
    
    $
    16
    
    
    $
    25
    
    
    Non-recourse, fixed rateBethesda Crescent
    
    Washington, D.C.
    
    
    7.07
    
    
    March
    2009
    
    
    20
    
    
    
    32
    
    
    Non-recourse, fixed rate2000 L Street
    
    Washington, D.C.
    
    
    6.26
    
    
    March
    2009
    
    
    35
    
    
    
    56
    
    
    Non-recourse, fixed rateSilver Spring Metro Plaza(2)
    
    Washington, D.C.
    
    
    6.00
    
    
    June
    2009
    
    
    60
    
    
    
    97
    
    
    Non-recourse, floating rate2401 Pennsylvania Avenue(2)
    
    Washington, D.C.
    
    
    6.00
    
    
    June
    2009
    
    
    11
    
    
    
    17
    
    
    Non-recourse, floating rate1250 Connecticut(2)
    
    Washington, D.C.
    
    
    6.00
    
    
    June
    2009
    
    
    27
    
    
    
    44
    
    
    Non-recourse, floating rateWaterview(3)
    
    Washington, D.C.
    
    
    2.46
    
    
    August
    2009
    
    
    3
    
    
    
    5
    
    
    Non-recourse, floating rate1460 Broadway
    
    New York
    
    
    5.11
    
    
    November
    2012
    
    
    
    
    
    
    11
    
    
    Non-recourse, fixed rate5670 Wilshire
    
    Los Angeles
    
    
    3.48
    
    
    May
    2013
    
    
    
    
    
    
    57
    
    
    Non-recourse, floating rateFour Allen Center
    
    Houston
    
    
    5.77
    
    
    October
    2013
    
    
    149
    
    
    
    240
    
    
    Non-recourse, fixed rateErnst & Young Plaza
    
    Los Angeles
    
    
    5.07
    
    
    February
    2014
    
    
    69
    
    
    
    111
    
    
    Non-recourse, fixed rateGrace Building
    
    New York
    
    
    5.54
    
    
    July
    2014
    
    
    118
    
    
    
    191
    
    
    Non-recourse, fixed rate1411 Broadway
    
    New York
    
    
    5.50
    
    
    July
    2014
    
    
    
    
    
    
    109
    
    
    Non-recourse, fixed rateBank of America Plaza
    
    Los Angeles
    
    
    5.31
    
    
    September
    2014
    
    
    144
    
    
    
    232
    
    
    Non-recourse, fixed rate2001 M Street
    
    Washington, D.C.
    
    
    5.25
    
    
    December
    2014
    
    
    28
    
    
    
    45
    
    
    Non-recourse, fixed rateVictor Building
    
    Washington, D.C.
    
    
    5.39
    
    
    February
    2016
    
    
    31
    
    
    
    50
    
    
    Non-recourse, fixed rateOne New York Plaza
    
    New York
    
    
    5.50
    
    
    March
    2016
    
    
    245
    
    
    
    397
    
    
    Non-recourse, fixed rateMarina Towers
    
    Los Angeles
    
    
    5.84
    
    
    April
    2016
    
    
    13
    
    
    
    21
    
    
    Non-recourse, fixed rateU.S. Fund Pool debt
    
    
    
    
    6.85
    
    
    May
    2011
    
    
    138
    
    
    
    306
    
    
    Non-recourse, fixed rateU.S. Fund corporate debt
    
    
    
    
    3.70
    
    
    October
    2011
    
    
    1,204
    
    
    
    3,089
    
    
    Non-recourse, floating rateU.S. Fund Pool debt
    
    
    
    
    1.95
    
    
    October
    2011
    
    
    267
    
    
    
    594
    
    
    Non-recourse, floating rateTotal U.S. Office Fund
    
    
    
    
    4.40
    
    
    
    
    
    
    $
    2,578
    
    
    $
    5,729
 (1)
    
    Reflects Brookfield Properties effective 45% interest(2)
    
    Property debt is cross-collateralized(3)
    
    Development debt
 51




---



##### 



PART IV  CANADIAN OFFICE FUND SUPPLEMENTAL INFORMATION
    BrookfieldBrookfield
    
    
    Other
    
    
    PropertiesNumber
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Owned
    
    
    Properties
    
    
    Share-
    
    
    Netof
    
    
    Leased
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    Interest
    
    
    Owned
    
    
    holders
    
    
    Owned(Square feet in 000s)
    
    Properties
    
    
    %
    
    
    Office
    
    
    Retail
    
    
    Leasable
    
    
    Parking
    
    
    Area
    
    
    %
    
    
    Interest(1)
    
    
    Interests
    
    
    InterestTorontoFirst Canadian Place
    
    
    1
    
    
    
    96.5
    
    
    
    2,379
    
    
    
    232
    
    
    
    2,611
    
    
    
    170
    
    
    
    2,781
    
    
    
    25
    
    
    
    695
    
    
    
    (76
    )
    
    
    6192 Queen Street East
    
    
    1
    
    
    
    98.6
    
    
    
    448
    
    
    
    16
    
    
    
    464
    
    
    
    81
    
    
    
    545
    
    
    
    25
    
    
    
    136
    
    
    
    (15
    )
    
    
    121151 Yonge Street
    
    
    1
    
    
    
    94.7
    
    
    
    289
    
    
    
    10
    
    
    
    299
    
    
    
    72
    
    
    
    371
    
    
    
    25
    
    
    
    93
    
    
    
    (10
    )
    
    
    833
    
    
    
    96.7
    
    
    
    3,116
    
    
    
    258
    
    
    
    3,374
    
    
    
    323
    
    
    
    3,697
    
    
    
    
    
    
    
    924
    
    
    
    (101
    )
    
    
    823CalgaryAltius Centre
    
    
    1
    
    
    
    98.1
    
    
    
    303
    
    
    
    3
    
    
    
    306
    
    
    
    72
    
    
    
    378
    
    
    
    25
    
    
    
    95
    
    
    
    (11
    )
    
    
    841
    
    
    
    98.1
    
    
    
    303
    
    
    
    3
    
    
    
    306
    
    
    
    72
    
    
    
    378
    
    
    
    
    
    
    
    95
    
    
    
    (11
    )
    
    
    84OttawaPlace de Ville I
    
    
    2
    
    
    
    99.4
    
    
    
    569
    
    
    
    18
    
    
    
    587
    
    
    
    502
    
    
    
    1,089
    
    
    
    25
    
    
    
    272
    
    
    
    (30
    )
    
    
    242Place de Ville II
    
    
    2
    
    
    
    99.3
    
    
    
    591
    
    
    
    19
    
    
    
    610
    
    
    
    433
    
    
    
    1,043
    
    
    
    25
    
    
    
    261
    
    
    
    (29
    )
    
    
    232Jean Edmonds Towers
    
    
    2
    
    
    
    100.0
    
    
    
    541
    
    
    
    12
    
    
    
    553
    
    
    
    95
    
    
    
    648
    
    
    
    25
    
    
    
    162
    
    
    
    (18
    )
    
    
    1446
    
    
    
    99.5
    
    
    
    1,701
    
    
    
    49
    
    
    
    1,750
    
    
    
    1,030
    
    
    
    2,780
    
    
    
    
    
    
    
    695
    
    
    
    (77
    )
    
    
    618Other CommercialCanadian Western Bank, Edmonton
    
    
    1
    
    
    
    99.8
    
    
    
    371
    
    
    
    36
    
    
    
    407
    
    
    
    91
    
    
    
    498
    
    
    
    25
    
    
    
    125
    
    
    
    (14
    )
    
    
    111Enbridge Tower, Edmonton
    
    
    1
    
    
    
    100.0
    
    
    
    184
    
    
    
    
    
    
    
    184
    
    
    
    30
    
    
    
    214
    
    
    
    25
    
    
    
    54
    
    
    
    (7
    )
    
    
    472
    
    
    
    99.9
    
    
    
    555
    
    
    
    36
    
    
    
    591
    
    
    
    121
    
    
    
    712
    
    
    
    
    
    
    
    179
    
    
    
    (21
    )
    
    
    158TOTAL COMMERCIAL
    
    
    12
    
    
    
    97.9
    
    
    
    5,675
    
    
    
    346
    
    
    
    6,021
    
    
    
    1,546
    
    
    
    7,567
    
    
    
    
    
    
    
    1,893
    
    
    
    (210
    )
    
    
    1,683
 (1)
    
    Represents the companys consolidated interest before non-controlling
interests
 Brookfield
    
    
    
    
    
    
    BrookfieldNumber
    
    
    
    
    
    
    Owned
    
    
    Properties
    
    
    Other
    
    
    Propertiesof
    
    
    Total
    
    
    Interest
    
    
    Owned
    
    
    Shareholders
    
    
    Net Owned(Square feet in 000s)
    
    Sites
    
    
    Area
    
    
    %
    
    
    Interest(1)
    
    
    Interests
    
    
    BrookfieldOttawa300 Queen Street
    
    
    1
    
    
    
    577
    
    
    
    25
    
    
    
    144
    
    
    
    (16
    )
    
    
    128TOTAL DEVELOPMENT
    
    
    1
    
    
    
    577
    
    
    
    
    
    
    
    144
    
    
    
    (16
    )
    
    
    128
 (1)
    
    Represents the companys consolidated interest before non-controlling interests
 52




---



##### 



Funds from Operations(Millions)
    
    Balance Sheet
    
    
    2008
    
    
    2007Toronto, Ontario
    
    $
    217
    
    
    $
    21
    
    
    $
    22Calgary, Alberta
    
    
    16
    
    
    
    4
    
    
    
    3Ottawa, Ontario
    
    
    81
    
    
    
    7
    
    
    
    7Edmonton, Alberta and other
    
    
    14
    
    
    
    3
    
    
    
    3328
    
    
    
    35
    
    
    
    35Development properties
    
    
    2
    
    
    
    
    
    
    
    Total book value / Net operating income
    
    
    330
    
    
    
    35
    
    
    
    35Property specific and subsidiary debt / Interest expense
    
    
    (132
    )
    
    
    (8
    )
    
    
    (9
    )198
    
    
    
    27
    
    
    
    26Other assets (liabilities), net / Other income (expenses), net
    
    
    (46
    )
    
    
    
    
    
    
    Net investment / Funds from operations prior to fee income
    
    
    152
    
    
    
    27
    
    
    
    26Fee income
    
    
    
    
    
    
    8
    
    
    
    9Invested capital / Funds from operations
    
    $
    152
    
    
    $
    35
    
    
    $
    35
  (Millions)
    
    2008
    
    
    2007
    
    
    2006Commercial property revenueRevenue from current properties
    
    $
    66
    
    
    $
    64
    
    
    $
    56Straight-line rental income
    
    
    1
    
    
    
    1
    
    
    
    1Intangible amortization
    
    
    5
    
    
    
    7
    
    
    
    772
    
    
    
    72
    
    
    
    64Recurring fee income
    
    
    8
    
    
    
    9
    
    
    
    7Total commercial property revenue
    
    
    80
    
    
    
    81
    
    
    
    71Property operating costs
    
    
    (37
    )
    
    
    (37
    )
    
    
    (33
    )Commercial property net operating income
    
    $
    43
    
    
    $
    44
    
    
    $
    38
 SUMMARY OF INVESTMENT
  BrookfieldProperties'
    
    
    
    
    
    
    
    
    
    
    Net BookNumber of
    
    
    Total Area
    
    
    Owned Interest
    
    
    Book Value
    
    
    Debt
    
    
    EquityRegion
    
    Properties
    
    
    (000s Sq. Ft.)
    
    
    (000s Sq. Ft.)(1)
    
    
    (Millions)
    
    
    (Millions)
    
    
    (Millions)Commercial PropertiesToronto, Ontario
    
    
    3
    
    
    
    3,697
    
    
    
    924
    
    
    $
    217
    
    
    $
    82
    
    
    $
    135Calgary, Alberta
    
    
    1
    
    
    
    378
    
    
    
    95
    
    
    
    16
    
    
    
    17
    
    
    
    (1
    )Ottawa, Ontario
    
    
    6
    
    
    
    2,780
    
    
    
    695
    
    
    
    81
    
    
    
    19
    
    
    
    62Other
    
    
    2
    
    
    
    712
    
    
    
    179
    
    
    
    14
    
    
    
    14
    
    
    
    Continuing Operations
    
    
    12
    
    
    
    7,567
    
    
    
    1,893
    
    
    $
    328
    
    
    $
    132
    
    
    $
    196Development sitesOttawa, Ontario
    
    
    1
    
    
    
    577
    
    
    
    144
    
    
    
    2
    
    
    
    
    
    
    
    2Total
    
    
    13
    
    
    
    8,144
    
    
    
    2,037
    
    
    $
    330
    
    
    $
    132
    
    
    $
    198
 
 (1)
    
    Represents consolidated interest before non-controlling interests 53




---



##### 



BrookfieldPropertiesConsolidatedProperty
    
    Location
    
    Interest Rate %
    
    
    Maturity Date
    
    
    Share (Millions)
    
    
    Mortgage DetailsEnbridge Tower
    
    Edmonton
    
    
    
    
    
    
    6.72
    
    
    June         2009
    
    $
    2
    
    
    Non-recourse, fixed ratePlace de Ville I
    
    Ottawa
    
    
    
    
    
    
    7.81
    
    
    November 2009
    
    
    5
    
    
    Non-recourse, fixed rateFirst Canadian Place
    
    Toronto
    
    
    
    
    
    
    8.06
    
    
    December         2009
    
    
    51
    
    
    Non-recourse, fixed rate151 Yonge Street
    
    Toronto
    
    
    
    
    
    
    6.01
    
    
    June         2012
    
    
    8
    
    
    Non-recourse, fixed rateJean Edmonds Tower
    
    Ottawa
    
    
    
    
    
    
    5.55
    
    
    January         2014
    
    
    1
    
    
    Non-recourse, fixed rate2 Queen Street East
    
    Toronto
    
    
    
    
    
    
    5.64
    
    
    December         2017
    
    
    23
    
    
    Non-recourse, fixed rateAltius Centre
    
    Calgary
    
    
    
    
    
    
    5.64
    
    
    December         2017
    
    
    17
    
    
    Non-recourse, fixed rateCanadian Western Bank
    
    Edmonton
    
    
    
    
    
    
    5.64
    
    
    December         2017
    
    
    12
    
    
    Non-recourse, fixed rateJean Edmonds Tower
    
    Ottawa
    
    
    
    
    
    
    6.79
    
    
    January         2024
    
    
    13
    
    
    Non-recourse, fixed rateTotal Canadian Office Fund
    
    
    
    
    
    
    
    
    6.81
    
    
    
    
    
    
    $
    132
 54




---



##### 



PART V  RISKS AND UNCERTAINTIES
    PROPERTY RELATED RISKS
 Commercial properties
     Residential developments
  INTEREST RATE AND FINANCING RISK
    55




---



##### 



CREDIT RISK
    Year of
    
    
    000s
    
    
    % of

    
    CreditTenant
    
    Location
    
    Expiry(1)
    
    
    Sq. Ft.(2)
    
    
    Sq. Ft.(2)

    
    Rating(3)1
    
    
    Merrill Lynch(4)
    
    New York/Toronto/Denver/Los Angeles
    
    
    2013
    
    
    
    4,923
    
    
    
    7.7
    %
    
    A2
    
    
    Government and Government Agencies(5)
    
    All Markets
    
    Various
    
    
    
    3,134
    
    
    
    4.9
    %
    
    AAA3
    
    
    Chevron
    
    Houston
    
    
    2017
    
    
    
    1,744
    
    
    
    2.7
    %
    
    AA4
    
    
    Wachovia
    
    New York
    
    
    2015
    
    
    
    1,439
    
    
    
    2.2
    %
    
    A5
    
    
    CIBC
    
    New York/Toronto/Calgary
    
    
    2032
    
    
    
    1,437
    
    
    
    2.2
    %
    
    A+6
    
    
    RBC Financial Group
    
    Five Markets
    
    
    2019
    
    
    
    1,206
    
    
    
    1.9
    %
    
    AA-7
    
    
    Bank of Montreal
    
    Toronto/Calgary
    
    
    2018
    
    
    
    1,134
    
    
    
    1.7
    %
    
    A+8
    
    
    Petro-Canada
    
    Calgary
    
    
    2028
    
    
    
    1,015
    
    
    
    1.6
    %
    
    BBB9
    
    
    Kellogg, Brown & Root
    
    Houston
    
    
    2017
    
    
    
    994
    
    
    
    1.5
    %
    
    Not Rated10
    
    
    JP Morgan Chase
    
    New York/Denver/Houston/Los Angeles
    
    
    2020
    
    
    
    975
    
    
    
    1.5
    %
    
    A+11
    
    
    Goldman Sachs
    
    New York
    
    
    2012
    
    
    
    896
    
    
    
    1.4
    %
    
    A12
    
    
    Target Corporation
    
    Minneapolis
    
    
    2014
    
    
    
    886
    
    
    
    1.4
    %
    
    A+13
    
    
    Devon Energy
    
    Houston
    
    
    2020
    
    
    
    865
    
    
    
    1.3
    %
    
    BBB+14
    
    
    Imperial Oil
    
    Calgary
    
    
    2016
    
    
    
    717
    
    
    
    1.1
    %
    
    AAA15
    
    
    EnCana Corporation
    
    Calgary/Denver
    
    
    2018
    
    
    
    707
    
    
    
    1.1
    %
    
    A-16
    
    
    Continental Airlines
    
    Houston
    
    
    2010
    
    
    
    678
    
    
    
    1.0
    %
    
    B17
    
    
    Cadwalader, Wickersham & Taft
    
    New York
    
    
    2024
    
    
    
    549
    
    
    
    0.8
    %
    
    Not Rated18
    
    
    Talisman Energy
    
    Calgary
    
    
    2015
    
    
    
    539
    
    
    
    0.8
    %
    
    BBB19
    
    
    Amerada Hess Corporation
    
    Houston
    
    
    2011
    
    
    
    475
    
    
    
    0.7
    %
    
    BBB-20
    
    
    Cleary, Gottlieb, Steen & Hamilton
    
    New York
    
    
    2031
    
    
    
    470
    
    
    
    0.7
    %
    
    Not RatedTotal
    
    
    
    
    
    
    
    
    24,783
    
    
    
    38.2
    %
 
 (1)
    
    Weighted average based on square feet(2)
    
    Prior to considering partnership interests in partially-owned properties(3)
    
    From S&P, Moodys Investor Service or DBRS(4)
    
    Merrill Lynch leases 4.6 million square feet in the World Financial Center (WFC),
of which they occupy 2.8 million square feet with the balance being leased to various
subtenants ranging in size up to 500,000 square feet. Of this 2.8 million square feet, 1.9
million is in 4 WFC, in which Merrill Lynch has a 49% interest, and 0.9 million square feet is
in 2 WFC, in which Merrill Lynch has an effective 25% interest through zero-coupon notes.(5)
    
    Represents various U.S. and Canadian federal governments and agencies   56




---



##### 



LEASE ROLL-OVER RISK
   Currently
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2016(000s Sq. Ft.)
    
    Available
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    2013
    
    
    2014
    
    
    2015
    
    
    & Beyond
    
    
    Subtotal
    
    
    Parking
    
    
    TotalMidtown New York
    
    
    627
    
    
    
    375
    
    
    
    391
    
    
    
    131
    
    
    
    446
    
    
    
    751
    
    
    
    215
    
    
    
    344
    
    
    
    3,247
    
    
    
    6,527
    
    
    
    36
    
    
    
    6,563Downtown New York
    
    
    141
    
    
    
    196
    
    
    
    286
    
    
    
    670
    
    
    
    426
    
    
    
    4,759
    
    
    
    410
    
    
    
    2,156
    
    
    
    4,675
    
    
    
    13,719
    
    
    
    281
    
    
    
    14,000Boston
    
    
    113
    
    
    
    183
    
    
    
    125
    
    
    
    454
    
    
    
    48
    
    
    
    32
    
    
    
    30
    
    
    
     ̄
    
    
    
    1,005
    
    
    
    1,990
    
    
    
    276
    
    
    
    2,266Washington, D.C.
    
    
    379
    
    
    
    511
    
    
    
    292
    
    
    
    195
    
    
    
    603
    
    
    
    418
    
    
    
    1,232
    
    
    
    273
    
    
    
    1,716
    
    
    
    5,619
    
    
    
    970
    
    
    
    6,589Los Angeles
    
    
    1,217
    
    
    
    422
    
    
    
    836
    
    
    
    1,032
    
    
    
    1,405
    
    
    
    902
    
    
    
    715
    
    
    
    359
    
    
    
    1,736
    
    
    
    8,624
    
    
    
    2,139
    
    
    
    10,763Houston
    
    
    425
    
    
    
    181
    
    
    
    304
    
    
    
    780
    
    
    
    1,102
    
    
    
    775
    
    
    
    595
    
    
    
    657
    
    
    
    3,461
    
    
    
    8,280
    
    
    
    838
    
    
    
    9,118Toronto
    
    
    164
    
    
    
    432
    
    
    
    580
    
    
    
    511
    
    
    
    763
    
    
    
    1,478
    
    
    
    280
    
    
    
    715
    
    
    
    2,694
    
    
    
    7,617
    
    
    
    1,519
    
    
    
    9,136Calgary
    
    
    7
    
    
    
    61
    
    
    
    346
    
    
    
    680
    
    
    
    461
    
    
    
    502
    
    
    
    111
    
    
    
    1,016
    
    
    
    2,497
    
    
    
    5,681
    
    
    
    1,023
    
    
    
    6,704Ottawa
    
    
    8
    
    
    
    35
    
    
    
    7
    
    
    
    8
    
    
    
    6
    
    
    
    1,131
    
    
    
    9
    
    
    
    542
    
    
    
    4
    
    
    
    1,750
    
    
    
    1,030
    
    
    
    2,780Denver
    
    
    31
    
    
    
    39
    
    
    
    104
    
    
    
    99
    
    
    
    87
    
    
    
    151
    
    
    
    134
    
    
    
    59
    
    
    
    620
    
    
    
    1,324
    
    
    
    503
    
    
    
    1,827Minneapolis
    
    
    188
    
    
    
    71
    
    
    
    65
    
    
    
    48
    
    
    
    178
    
    
    
    791
    
    
    
    172
    
    
    
    434
    
    
    
    583
    
    
    
    2,530
    
    
    
    521
    
    
    
    3,051Other
    
    
    21
    
    
    
    41
    
    
    
    181
    
    
    
    142
    
    
    
    90
    
    
    
    104
    
    
    
    45
    
    
    
    115
    
    
    
    514
    
    
    
    1,253
    
    
    
    385
    
    
    
    1,638Total
    
    
    3,321
    
    
    
    2,547
    
    
    
    3,517
    
    
    
    4,750
    
    
    
    5,615
    
    
    
    11,794
    
    
    
    3,948
    
    
    
    6,670
    
    
    
    22,752
    
    
    
    64,914
    
    
    
    9,521
    
    
    
    74,4355.1
    %
    
    
    3.9
    %
    
    
    5.4
    %
    
    
    7.3
    %
    
    
    8.6
    %
    
    
    18.2
    %
    
    
    6.1
    %
    
    
    10.3
    %
    
    
    35.1
    %
    
    
    100.0
    %
 ENVIRONMENTAL RISKS
   OTHER RISKS AND UNCERTAINTIES
     57




---



##### 



FOREIGN EXCHANGE FLUCTUATIONS
  DERIVATIVE FINANCIAL INSTRUMENTS
  
    
    Foreign currency forward contracts to hedge exposures to Canadian dollar denominated net
investments in self-sustaining subsidiaries and foreign currency denominated financial
assets;
    
    Interest rate swaps to manage interest rate risk associated planned refinancings and
existing variable rate debt;
    
    Interest rate caps to hedge interest rate risk on a portion of its variable rate debt;
and
    
    Total return swap on the companys shares to economically hedge exposure to variability
in share price under the Deferred Share Unit plan.
  Foreign currency hedging
  Derivatives
    
    


    Non-DerivativesHedging Item
    
    
    Notional
    
    
    Rate
    
    
    Maturity
    
    
    Fair Value
    
    
    Hedging Item
    
    
    NotionalDecember 31, 2008
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Capital securities - corporate
    
    
    
    C$750MDecember 31, 2007
    
    Forward - Sell C$/ Buy US$
    

    
    C$800M

    
    C$1.00 = US$1.01
    

    March 2008
    
    nil
    
    
    Capital securities - corporate
    

    C$350M
 58




---



##### 



Interest rate hedging
  (Millions)
    
    Hedging Item

    
    Notional
    
    
    Rate

    
    Maturity
    
    
    Fair Value

    
    Hedged ItemDecember 31, 2008Interest rate cap
    
    $
    3,100
    
    
    
    6
    %
    
    
    2010
    
    
    nil
    
    Interest payments on LIBOR debtInterest rate cap
    
    
    600
    
    
    
    7
    %
    
    
    2010
    
    
    nil
    
    Interest payments on LIBOR debtInterest rate cap
    
    
    300
    
    
    
    5
    %
    
    
    2011
    
    
    nil
    
    Interest payments on LIBOR debtInterest rate swap
    (1)
    
    55
    
    
    Pay 2.68%
    
    
    2010
    
    
    
    (1
    )
    
    Interest payments on LIBOR debtDecember 31, 2007Interest rate cap
    
    
    3,100
    
    
    
    6
    %
    
    
    2008
    
    
    nil
    
    Interest payments on LIBOR debtInterest rate cap
    
    
    600
    
    
    
    7
    %
    
    
    2008
    
    
    nil
    
    Interest payments on LIBOR debtInterest rate swap
    (1)
    
    350
    
    
    Pay 5.8%
    
    
    2017
    
    
    
    (33
    )
    
    Interest payments on refinancing of fixed debt
 
 (1)
    
    For interest rate swaps, receive LIBOR    Other derivatives
    59




---



##### 



PART VI  CRITICAL ACCOUNTING POLICIES AND ESTIMATES
 CHANGES IN ACCOUNTING POLICIES
 Capital Disclosures
  Financial Instruments  Disclosures and Presentation
  Inventories
  FUTURE ACCOUNTING POLICY CHANGES
 Goodwill and Intangible Assets
  INTERNATIONAL FINANCIAL REPORTING STANDARDS
  USE OF ESTIMATES
   60




---



##### 



Property Acquisitions
   Tenant Improvements
  Depreciation and Amortization
   Impairment of Assets
    Revenue Recognition
  61




---



##### 



Fair Value of Financial Instruments
   Tax
     62




---



##### 



U.S. Office Fund
    RELATED-PARTY TRANSACTIONS
   63




---



##### 



PART VII  BUSINESS ENVIRONMENT AND OUTLOOK
 OPERATING ENVIRONMENT AND OUTLOOK
     DISCLOSURE CONTROLS AND PROCEDURES
  INTERNAL CONTROL OVER FINANCIAL REPORTING
 Managements Report on
Internal Control over Financial Reporting
 
 Bryan K. Davis
Senior Vice President and Chief Financial Officer
March 6, 2009
 64




---



##### 



DISTRIBUTIONS
  Currency
    
    
    Dec. 31, 2008
    
    
    Dec. 31, 2007
    
    
    Dec. 31, 2006
    
    
    Dec. 31, 2005Common shares(1)
    
    US$
    
    
    $
    0.5600
    
    
    $
    0.5500
    
    
    $
    0.5100
    
    
    $
    0.4300Class A preferred shares(2)
    
    
    C$
    
    
    
    0.0833
    
    
    
    0.0833
    
    
    
    0.0833
    
    
    
    0.0833Class AA Series E preferred shares
    
    
    C$
    
    
    
    0.8776
    
    
    
    1.0178
    
    
    
    0.9922
    
    
    
    0.7591Class AAA Series E preferred shares
    
    
    C$
    
    
    
    0.8457
    
    
    
    0.4830
    
    
    
    1.0082
    
    
    
    0.7695Class AAA Series F preferred shares
    
    
    C$
    
    
    
    1.5000
    
    
    
    1.5000
    
    
    
    1.5000
    
    
    
    1.5000Class AAA Series G preferred shares
    
    US$
    
    
    
    1.3125
    
    
    
    1.3125
    
    
    
    1.3125
    
    
    
    1.3125Class AAA Series H preferred shares
    
    
    C$
    
    
    
    1.4375
    
    
    
    1.4375
    
    
    
    1.4375
    
    
    
    1.4375Class AAA Series I preferred shares
    
    
    C$
    
    
    
    1.3000
    
    
    
    1.3000
    
    
    
    1.3000
    
    
    
    1.3000Class AAA Series J preferred shares
    
    
    C$
    
    
    
    1.2500
    
    
    
    1.2500
    
    
    
    1.2500
    
    
    
    1.2500Class AAA Series K preferred shares
    
    
    C$
    
    
    
    1.3000
    
    
    
    1.3000
    
    
    
    1.3000
    
    
    
    1.3000
 (1)
    
    Per share amounts have been restated to reflect the impact of the three-for-two
common stock splits effective May 4, 2007 and March 31, 2005(2)
    
    Per share amounts have been restated to reflect the impact of the nine-for-four
class A preferred share stock split effective May 4, 2007 65