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Toronto, Ontario February 15, 2023 \u2013 Choice Properties Real Estate Investment Trust (\u201cChoice Properties\u201d or the \u201cTrust\u201d) (TSX: CHP.UN) today announced its consolidated financial results for the three months and year ended December 31, 2022. The 2022 Annual Report to Unitholders is available in the Investors section of the Trust\u2019s website at www.choicereit.ca<\/a>, and has been filed on SEDAR at www.sedar.com<\/a>. (1) Refer to Non-GAAP Financial Measures and Additional Financial Information section.<\/p>\n\n\n\n \n\n\n \n\n\n\n<\/p> Choice Properties reported a net loss of $579.0 million for the fourth quarter of 2022 as compared to a net loss of $163.1 million in the fourth quarter of 2021. The change of $415.9 million compared to the prior year was primarily due to:<\/p>\n\n\n\n Choice Properties reported net income of $744.3 million for the year ended December 31, 2022 as compared to $23.0 million for the year ended December 31, 2021. The increase of $721.2 million compared to the prior year was mainly due to:<\/p>\n\n\n\n \n\n\n \n\n\n\n<\/p> For the three months and year ended December 31, 2022, Same-Asset NOI, cash basis(i) increased by $8.5 million and $32.7 million, respectively, compared to the prior year, primarily due to increased revenue from improved occupancy, contractual rent steps, higher recovery revenues, and lower bad debt expense. On January 18, 2023, the Trust, paid in full upon maturity, at par, plus accrued and unpaid interest thereon, the $125 million aggregate principal amount of the Series D-C senior unsecured debentures outstanding. The repayment of the Series D-C senior unsecured debenture was funded by an advance on the Trust\u2019s credit facility. We are focused on capital preservation, delivering stable and growing cash flows and net asset value appreciation, all with a long-term focus. Our high-quality portfolio is primarily leased to necessity-based tenants and logistics providers, who are less sensitive to economic volatility and therefore provide stability to our overall portfolio. We continue to experience positive leasing momentum across our portfolio and are well positioned to handle our 2023 lease renewal exposure. We also continue to advance our development program, with a focus on industrial opportunities, which provides us with the best opportunity to add high-quality real estate to our portfolio at a reasonable cost and drive net asset value appreciation over time. In addition to using performance measures determined in accordance with International Financial Reporting Standards (\u201cIFRS\u201d or \u201cGAAP\u201d), Choice Properties also measures its performance using certain non-GAAP measures, and provides these measures in this news release so that investors may do the same. Such measures and related per-unit amounts are not defined by IFRS and therefore should not be construed as alternatives to net income or cash flow from operating activities determined in accordance with IFRS. Furthermore, the supplemental measures used by management may not be comparable to similar measures presented by other real estate investment trusts or enterprises. The non-GAAP measures included in this news release are defined and reconciled to the most comparable GAAP measure below. Choice Properties believes these non-GAAP financial measures provide useful information to both management and investors in measuring the financial performance and financial condition of the Trust for the reasons outlined below.<\/p>\n\n\n\n\n \n\n\n \n\n\n\n<\/p> The following table reconciles net income (loss) as determined in accordance with GAAP to net income on a proportionate share basis for the three months and year ended December 31, 2022.<\/p>\n\n\n\n\n \n\n\n
\u201cWe delivered solid operating and financial results for the quarter and year ended December 31, 2022. Our performance was driven by the strength of our grocery anchored and necessity-based retail portfolio, the realization of embedded rent growth in our well located generic industrial portfolio and our growing mixed-use and residential platform. In addition to our strong results, we continued to focus on improving the quality of our portfolio and driving growth through development. In 2022 we completed over $1.2 billion of real estate transactions and made significant advances in our industrial and mixed-use development pipelines.\u201d said Rael Diamond, President and Chief Executive Officer of the Trust. \u201cSupported by the strength of our business, we are pleased to announce Choice\u2019s first distribution increase since 2017. The increase reflects the confidence we have in our portfolio to continue to deliver steady and growing cash flows, and our strong financial position\u201d.<\/p>\n\n\n\n2022 Fourth Quarter Highlights<\/h4>\n\n\n\n
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Summary of GAAP Basis Financial Results<\/h4>\n\n\n\n\n
<\/th> <\/th> Three Months<\/strong><\/th> <\/th> <\/th> <\/th> <\/th> <\/th> Year Ended<\/strong><\/th> <\/th> <\/th> <\/th> <\/th><\/tr><\/thead> ($ thousands except where otherwise indicated)
(unaudited)<\/td><\/td> December 31, 2022<\/strong><\/td> <\/td> December 31, 2021<\/td> <\/td> Change $<\/td> <\/td> December 31, 2022<\/strong><\/td> <\/td> December 31, 2021<\/td> <\/td> Change $<\/td><\/tr> Net income (loss)<\/td> $<\/strong><\/td> (579,000)<\/strong><\/td> <\/td> (163,087)<\/td> <\/td> (415,913)<\/td> $<\/strong><\/td> 744,253<\/strong><\/td> $<\/td> 23,008<\/td> $<\/td> 721,245<\/td><\/tr> Net income (loss) per unit diluted<\/td> <\/td> (0.800)<\/strong><\/td> <\/td> (0.225)<\/td> <\/td> (0.575)<\/td> <\/td> 1.029<\/strong><\/td> <\/td> 0.032<\/td> <\/td> 0.997<\/td><\/tr> Rental revenue<\/td> <\/td> 314,382<\/strong><\/td> <\/td> 325,763<\/td> <\/td> (11,381)<\/td> <\/td> 1,264,594<\/strong><\/td> <\/td> 1,292,321<\/td> <\/td> (27,727)<\/td><\/tr> Fair value gain (loss) on Exchangeable Units(i)<\/sup><\/td> <\/td> (858,857)<\/strong><\/td> <\/td> (372,039)<\/td> <\/td> (486,818)<\/td> <\/td> 170,188<\/strong><\/td> <\/td> (862,815)<\/td> <\/td> 1,033,003<\/td><\/tr> Fair value gains (losses) excluding Exchangeable Units(ii)<\/sup><\/td> <\/td> 169,921<\/strong><\/td> <\/td> 96,941<\/td> <\/td> 72,980<\/td> <\/td> (136,422)<\/strong><\/td> <\/td> 457,237<\/td> <\/td> (593,659)<\/td><\/tr> Cash flows from operating activities<\/td> <\/td> 198,105<\/strong><\/td> <\/td> 244,202<\/td> <\/td> (46,097)<\/td> <\/td> 633,154<\/strong><\/td> <\/td> 669,428<\/td> <\/td> (36,274)<\/td><\/tr> Weighted average Units outstanding \u2013 diluted(iii)<\/sup><\/td> <\/td> 723,586,201<\/strong><\/td> <\/td> 723,363,313<\/td> <\/td> 222,888<\/td> <\/td> 723,523,362<\/strong><\/td> <\/td> 723,127,566<\/td> <\/td> 395,796<\/td><\/tr><\/tbody><\/table>
(ii) Fair value gains (losses) excluding Exchangeable Units includes adjustments to fair value of investment properties, real estate securities, and unit-based compensation.
(iii) Includes Trust Units and Exchangeable Units.<\/figcaption><\/figure>\n\n\n<\/p>\nQuarterly Results<\/h4>\n\n\n\n
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Year-to-date Results<\/h4>\n\n\n\n
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Summary of Proportionate Share(1) Financial Results<\/h4>\n\n\n\n\n
<\/th> <\/th> Three Months<\/strong><\/th> <\/th> <\/th> <\/th> <\/th> <\/th> Year Ended<\/strong><\/th> <\/th> <\/th> <\/th> <\/th><\/tr><\/thead> As at or for the period ended
($ thousands except where otherwise indicated)<\/td><\/td> December 31, 2022<\/strong><\/td> <\/td> December 31, 2021<\/td> <\/td> Change $<\/td> <\/td> December 31, 2022<\/strong><\/td> <\/td> December 31, 2021<\/td> <\/td> Change $<\/td><\/tr> Rental revenue(i)<\/sup><\/td> $<\/strong><\/td> 334,674<\/strong><\/td> $<\/td> 341,907<\/td> $<\/td> (7,233)<\/td> $<\/strong><\/td> 1,339,517<\/strong><\/td> $<\/td> 1,353,657<\/td> $<\/td> (14,140)<\/td><\/tr> Net Operating Income (\u201cNOI\u201d), cash basis(i)(ii)<\/sup><\/td> <\/td> 238,819<\/strong><\/td> <\/td> 238,674<\/td> <\/td> 145<\/td> <\/td> 941,935<\/strong><\/td> <\/td> 937,499<\/td> <\/td> 4,436<\/td><\/tr> Same-Asset NOI, cash basis(i)(ii)<\/sup><\/td> <\/td> 227,078<\/strong><\/td> <\/td> 218,593<\/td> <\/td> 8,485<\/td> <\/td> 893,876<\/strong><\/td> <\/td> 861,131<\/td> <\/td> 32,745<\/td><\/tr> Adjustment to fair value of investment properties(i)<\/sup><\/td> <\/td> 207,247<\/strong><\/td> <\/td> 109,227<\/td> <\/td> 98,020<\/td> <\/td> 441,853<\/strong><\/td> <\/td> 502,295<\/td> <\/td> (60,442)<\/td><\/tr> Occupancy (% of GLA)<\/td> <\/td> 97.8 %<\/strong><\/td> <\/td> 97.1 %<\/td> <\/td> 0.7 %<\/td> <\/td> 97.8 %<\/strong><\/td> <\/td> 97.1 %<\/td> <\/td> 0.7 %<\/td><\/tr> Funds from operations (\u201cFFO\u201d)(i)<\/sup><\/td> <\/td> 174,183<\/strong><\/td> <\/td> 174,797<\/td> <\/td> (614)<\/td> <\/td> 697,728<\/strong><\/td> <\/td> 689,898<\/td> <\/td> 7,830<\/td><\/tr> FFO(i)<\/sup> per unit diluted<\/td> <\/td> 0.241<\/strong><\/td> <\/td> 0.242<\/td> <\/td> (0.001)<\/td> <\/td> 0.964<\/strong><\/td> <\/td> 0.954<\/td> <\/td> 0.010<\/td><\/tr> Adjusted funds from operations (\u201cAFFO\u201d)(i)<\/sup><\/td> <\/td> 126,935<\/strong><\/td> <\/td> 118,924<\/td> <\/td> 8,011<\/td> <\/td> 581,752<\/strong><\/td> <\/td> 586,506<\/td> <\/td> (4,754)<\/td><\/tr> AFFO(i)<\/sup> per unit diluted<\/td> <\/td> 0.175<\/strong><\/td> <\/td> 0.164<\/td> <\/td> 0.011<\/td> <\/td> 0.804<\/strong><\/td> <\/td> 0.811<\/td> <\/td> (0.007)<\/td><\/tr> AFFO(i)<\/sup> payout ratio \u2013 diluted<\/td> <\/td> 105.5 %<\/strong><\/td> <\/td> 112.5 %<\/td> <\/td> (7.0) %<\/td> <\/td> 92.0 %<\/strong><\/td> <\/td> 91.2 %<\/td> <\/td> 0.8 %<\/td><\/tr> Cash distributions declared<\/td> <\/td> 133,858<\/strong><\/td> <\/td> 133,820<\/td> <\/td> 38<\/td> <\/td> 535,407<\/strong><\/td> <\/td> 535,104<\/td> <\/td> 303<\/td><\/tr> Weighted average number of Units outstanding \u2013 diluted(iii)<\/sup><\/td> <\/td> 723,586,201<\/strong><\/td> <\/td> 723,363,313<\/td> <\/td> 222,888<\/td> <\/td> 723,523,362<\/strong><\/td> <\/td> 723,127,566<\/td> <\/td> 395,796<\/td><\/tr><\/tbody><\/table>
(ii) Includes a provision for bad debts and rent abatements.
(iii) Includes Trust Units and Exchangeable Units.<\/figcaption><\/figure>\n\n\n<\/p>\nQuarterly and Year-to-date Results<\/h4>\n\n\n\n
For the three months ended December 31, 2022, Funds from Operations (\u201cFFO\u201d, a non-GAAP measure) was $174.2 million or $0.241 per unit diluted compared to $174.8 million or $0.242 per unit diluted for the three months ended December 31, 2021. FFO decreased by $0.6 million compared to the prior year, primarily as a result of the increase in Same-Asset NOI, offset by an increase in interest and general and administrative expenses and the impact of the Allied Transaction in Q1 2022. The impact of the Allied Transaction includes the loss of NOI, partially offset by the distribution and interest income earned from the limited partnership units and promissory note received from Allied in exchange for the properties sold. In addition, a non-recurring gain recognized in Q4 2021 due to the reversal of an expected credit loss related to a specific mortgage receivable contributed to the decline in FFO.
For the year ended December 31, 2022, FFO was $697.7 million or $0.964 per unit diluted compared to $689.9 million or $0.954 per unit diluted for the year ended December 31, 2021. FFO increased by $7.8 million compared to the prior year, primarily due to higher Same-Asset NOI, partially offset by an increase in interest and general and administrative expenses, and the impact of the Allied Transaction.<\/p>\n\n\n\nSubsequent Events<\/h4>\n\n\n\n
On January 31, 2023, the Trust acquired three retail assets from Loblaw for an aggregate purchase price of $98.6 million.
On February 15, 2023, the Trust announced an increase in the annual distribution by 1.4% to $0.75 per unit. The increase will be effective for Unitholders of record on March 31, 2023.
Subsequent to year end, the Trust entered into commitments for approximately $161.8 million of mortgage financing.
<\/p>\n\n\n\nOutlook<\/h4>\n\n\n\n
We are confident that our business model, stable tenant base, strong balance sheet and disciplined approach to financial management will continue to position us well for future success, however the Trust cannot predict the precise impacts of the broader economic environment on its 2023 financial results. In 2023, Choice Properties will continue to focus on its core business of essential retail and industrial, our growing residential platform and our robust development pipeline, and is targeting:<\/p>\n\n\n\n\n
Non-GAAP Financial Measures and Additional Financial Information<\/h4>\n\n\n\n
Non-GAAP Measure<\/strong><\/th> Description<\/strong><\/th><\/tr><\/thead> Proportionate Share<\/td> \u2022 Represents financial information adjusted to reflect the Trust\u2019s equity accounted joint ventures and financial real estate assets and its share of net income (losses) from equity accounted joint ventures and financial real estate assets on a proportionately consolidated basis at the Trust\u2019s ownership percentage of the related investment.
\u2022 Management views this method as relevant in demonstrating the Trust\u2019s ability to manage the underlying economics of the related investments, including the financial performance and cash flows and the extent to which the underlying assets are leveraged, which is an important component of risk management.<\/td><\/tr>Net Operating Income (\u201cNOI\u201d), Accounting Basis<\/td> \u2022 Defined as property rental revenue including straight line rental revenue, reimbursed contract revenue and lease surrender revenue, less direct property operating expenses and realty taxes, and excludes certain expenses such as interest expense and indirect operating expenses in order to provide results that reflect a property\u2019s operations before consideration of how it is financed or the costs of operating the entity in which it is held.
\u2022 Management believes that NOI is an important measure of operating performance for the Trust\u2019s commercial real estate assets that is used by real estate industry analysts, investors and management, while also being a key input in determining the fair value of the Choice Properties portfolio.<\/td><\/tr>NOI, Cash Basis<\/td> \u2022 Defined as property rental revenue excluding straight line rental revenue, direct property operating expenses and realty taxes and excludes certain expenses such as interest expense and indirect operating expenses in order to provide results that reflect a property\u2019s operations before consideration of how it is financed or the costs of operating the entity in which it is held.
\u2022 Management believes that NOI is a useful measure in understanding period-over-period changes in income from operations due to occupancy, rental rates, operating costs and realty taxes.<\/td><\/tr>Same-Asset NOI, Cash Basis
and
Same-Asset NOI, Accounting Basis<\/td>\u2022 Same-asset NOI is used to evaluate the period-over-period performance of those properties owned and operated by Choice Properties since January 1, 2021, inclusive.
\u2022 NOI from properties that have been (i) purchased, (ii) disposed, or (iii) subject to significant change as a result of new development, redevelopment, expansion, or demolition (collectively, \u201cTransactions\u201d) are excluded from the determination of same-asset NOI.
\u2022 Same-asset NOI, Cash Basis, is useful in evaluating the realization of contractual rental rate changes embedded in lease agreements and\/or the expiry of rent-free periods, while also being a useful measure in understanding period-over-period changes in NOI due to occupancy, rental rates, operating costs and realty taxes, before considering the changes in NOI that can be attributed to the Transactions and development activities.<\/td><\/tr>Funds from Operations (\u201cFFO\u201d)<\/td> \u2022 Calculated in accordance with the Real Property Association of Canada\u2019s (\u201cREALpac\u201d) Funds From Operations (FFO) & Adjusted Funds From Operations (AFFO) for IFRS<\/em> issued in January 2022.
\u2022 Management considers FFO to be a useful measure of operating performance as it adjusts for items included in net income (or net loss) that do not arise from operating activities or do not necessarily provide an accurate depiction of the Trust\u2019s past or recurring performance, such as adjustments to fair value of Exchangeable Units, investment properties, investment in real estate securities, and unit-based compensation. From time to time the Trust may enter into transactions that materially impact the calculation and are eliminated from the calculation for management\u2019s review purposes.
\u2022 Management uses and believes that FFO is a useful measure of the Trust\u2019s performance that, when compared period over period, reflects the impact on operations of trends in occupancy levels, rental rates, operating costs and realty taxes, acquisition activities and interest costs.<\/td><\/tr>Adjusted Funds from Operations (\u201cAFFO\u201d)<\/td> \u2022 Calculated in accordance with REALpac\u2019s Funds From Operations (FFO) & Adjusted Funds From Operations (AFFO) for IFRS<\/em> issued in January 2022.
\u2022 Management considers AFFO to be a useful measure of operating performance as it further adjusts FFO for capital expenditures that sustain income producing properties and eliminates the impact of straight-line rent. AFFO is impacted by the seasonality inherent in the timing of executing property capital projects.
\u2022 In calculating AFFO, FFO is adjusted by excluding straight-line rent adjustments, as well as costs incurred relating to internal leasing activities and property capital projects. Working capital changes, viewed as short-term cash requirements or surpluses, are deemed financing activities pursuant to the methodology and are not considered when calculating AFFO.
\u2022 Capital expenditures which are excluded and not deducted in the calculation of AFFO comprise those which generate a new investment stream, such as constructing a new retail pad during property expansion or intensification, development activities or acquisition activities.
\u2022 Accordingly, AFFO differs from FFO in that AFFO excludes from its definition certain non-cash revenues and expenses recognized under GAAP, such as straight-line rent, but also includes capital and leasing costs incurred during the period which are capitalized for GAAP purposes. From time to time the Trust may enter into transactions that materially impact the calculation and are eliminated from the calculation for management\u2019s review purposes.<\/td><\/tr>AFFO Payout Ratio<\/td> \u2022 AFFO payout ratio is a supplementary measures used by Management to assess the sustainability of the Trust\u2019s distribution payments.
\u2022 The ratio is calculated using cash distributions declared divided by AFFO.<\/td><\/tr>Earnings before Interest, Taxes, Depreciation, Amortization and Fair Value (\u201cEBITDAFV\u201d)<\/td> \u2022 Defined as net income attributable to Unitholders, reversing, where applicable, income taxes, interest expense, amortization expense, depreciation expense, adjustments to fair value and other adjustments as allowed in the Trust Indentures, as supplemented.
\u2022 Management believes EBITDAFV is useful in assessing the Trust\u2019s ability to service its debt, finance capital expenditures and provide for distributions to its Unitholders.<\/td><\/tr>Total Adjusted Debt<\/td> \u2022 Defined as variable rate debt (construction loans, mortgages, and credit facility) and fixed rate debt (senior unsecured debentures, construction loans and mortgages), as measured on a proportionate share basis(1)<\/sup>, and does not include the Exchangeable Units which are included as part of Unit Equity on account of the Exchangeable Units being economically equivalent and receiving equal distributions to the Trust Units.
\u2022 Total Adjusted Debt is also presented on a net basis to include the impact of other finance charges such as debt placement costs and discounts or premiums, and defeasance or other prepayments of debt.<\/td><\/tr>Adjusted Debt to EBITDAFV<\/td> \u2022 Calculated as Total Adjusted Debt divided by EBITDAFV.
\u2022 This ratio is used to assess the financial leverage of Choice Properties, to measure its ability to meet financial obligations and to provide a snapshot of its balance sheet strength.
\u2022 Management also presents this ratio with Total Adjusted Debt calculated as net of cash and cash equivalents at the measurement date.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n<\/p>\n<\/th> <\/th> Three Months<\/strong><\/th> <\/th> <\/th> <\/th> <\/th> <\/th> Year Ended<\/strong><\/th> <\/th> <\/th> <\/th> <\/th><\/tr><\/thead> For the periods ended December 31 ($ thousands)<\/td> <\/td> GAAP Basis<\/strong><\/td> <\/td> Consolidation
and eliminations(i)<\/sup><\/strong><\/td><\/td> Proportionate Share Basis<\/strong><\/td> <\/td> GAAP Basis<\/strong><\/td> <\/td> Consolidation
and eliminations(i)<\/sup><\/strong><\/td><\/td> Proportionate Share Basis<\/strong><\/td><\/tr> Net Operating Income<\/strong><\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td><\/tr> Rental revenue<\/td> $<\/td> 314,382<\/td> $<\/td> 20,292<\/td> $<\/td> 334,674<\/td> $<\/td> 1,264,594<\/td> $<\/td> 74,923<\/td> $<\/td> 1,339,517<\/td><\/tr> Property operating costs<\/td> <\/td> (87,180)<\/td> <\/td> (7,168)<\/td> <\/td> (94,348)<\/td> <\/td> (363,953)<\/td> <\/td> (26,427)<\/td> <\/td> (390,380)<\/td><\/tr> <\/td> <\/td> 227,202<\/td> <\/td> 13,124<\/td> <\/td> 240,326<\/td> <\/td> 900,641<\/td> <\/td> 48,496<\/td> <\/td> 949,137<\/td><\/tr> Other Income and Expenses<\/strong><\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td> <\/td><\/tr> Interest income<\/td> <\/td> 12,691<\/td> <\/td> (6,991)<\/td> <\/td> 5,700<\/td> <\/td> 27,360<\/td> <\/td> (7,532)<\/td> <\/td> 19,828<\/td><\/tr> Investment income<\/td> <\/td> 5,165<\/td> <\/td> \u2014<\/td> <\/td> 5,165<\/td> <\/td> 15,495<\/td> <\/td> \u2014<\/td> <\/td> 15,495<\/td><\/tr> Fee income<\/td> <\/td> 1,292<\/td> <\/td> \u2014<\/td> <\/td> 1,292<\/td> <\/td> 3,793<\/td> <\/td> \u2014<\/td> <\/td> 3,793<\/td><\/tr> Net interest expense and other financing charges<\/td> <\/td> (137,247)<\/td> <\/td> (4,488)<\/td> <\/td> (141,735)<\/td> <\/td> (536,857)<\/td> <\/td> (15,835)<\/td> <\/td> (552,692)<\/td><\/tr> General and administrative expenses<\/td> <\/td> (14,476)<\/td> <\/td> \u2014<\/td> <\/td> (14,476)<\/td> <\/td> (47,821)<\/td> <\/td> \u2014<\/td> <\/td> (47,821)<\/td><\/tr> Share of income (loss) from equity accounted joint ventures<\/td> <\/td> 15,522<\/td> <\/td> (15,522)<\/td> <\/td> \u2014<\/td> <\/td> 353,867<\/td> <\/td> (353,867)<\/td> <\/td> \u2014<\/td><\/tr> Amortization of intangible assets<\/td> <\/td> (250)<\/td> <\/td> \u2014<\/td> <\/td> (250)<\/td> <\/td> (1,000)<\/td> <\/td> \u2014<\/td> <\/td> (1,000)<\/td><\/tr> Acquisition transaction costs and other related expenses<\/td> <\/td> (82)<\/td> <\/td> \u2014<\/td> <\/td> (82)<\/td> <\/td> (5,108)<\/td> <\/td> \u2014<\/td> <\/td> (5,108)<\/td><\/tr> Adjustment to fair value of unit-based compensation<\/td> <\/td> (2,665)<\/td> <\/td> \u2014<\/td> <\/td> (2,665)<\/td> <\/td> (1,191)<\/td> <\/td> \u2014<\/td> <\/td> (1,191)<\/td><\/tr> Adjustment to fair value of Exchangeable Units<\/td> <\/td> (858,857)<\/td> <\/td> \u2014<\/td> <\/td> (858,857)<\/td> <\/td> 170,188<\/td> <\/td> \u2014<\/td> <\/td> 170,188<\/td><\/tr> Adjustment to fair value of investment properties<\/td> <\/td> 193,370<\/td> <\/td> 13,877<\/td> <\/td> 207,247<\/td> <\/td> 113,115<\/td> <\/td> 328,738<\/td> <\/td> 441,853<\/td><\/tr> Adjustment to fair value of investment in real estate securities<\/td> <\/td> (20,784)<\/td> <\/td> \u2014<\/td> <\/td> (20,784)<\/td> <\/td> (248,346)<\/td> <\/td> \u2014<\/td> <\/td> (248,346)<\/td><\/tr> Income (Loss) before Income Taxes<\/strong><\/td> <\/td> (579,119)<\/td> <\/td> \u2014<\/td> <\/td> (579,119)<\/td> <\/td> 744,136<\/td> <\/td> \u2014<\/td> <\/td> 744,136<\/td><\/tr> Income tax recovery<\/td> <\/td> 119<\/td> <\/td> \u2014<\/td> <\/td> 119<\/td> <\/td> 117<\/td> <\/td> \u2014<\/td> <\/td> 117<\/td><\/tr> Net Income (Loss)<\/strong><\/td> $<\/td> (579,000)<\/td> $<\/td> \u2014<\/td> $<\/td> (579,000)<\/td> $<\/td> 744,253<\/td> $<\/td> \u2014<\/td> $<\/td> 744,253<\/td><\/tr><\/tbody><\/table>