BMO reit beat

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This report was prepared by an analyst(s) employed by BMO Nesbitt Burns Inc., and who is (are) not registered as a research analyst(s) under

FINRA rules. For disclosure statements, including the Analyst's Certification, please refer to pages 35 to 36.

The BMO REIT Beat

Canadian Real Estate/REIT Weekly(Week ending January 2, 2015)

Weekly Highlights

The S&P/TSX Capped REIT index was unchanged for the week ending January 2 while the S&P/TSX Composite was 1.0%.comparison, the MSCI U.S. REIT index (RMZ) was0.1%. Over the last 12 months, the Canadian REIT index is 5.1%whthe RMZ is27.3%. The 10-year CDN bond yield ended the week at 1.74%, which was down 16 bps over last week.

2014 Performance:For 2014, the S&P/TSX Capped REIT Index returned +10% on capital appreciation of 4% and yield of 6REITs performed well in the first half of 2014 but lost some of the gains later in the year. The REIT index rose 9.2% to Aug 2due largely to an unanticipated 67 bps decline in 10-year GoC yields, and then declined 4.6% triggered initially by rate concerand exacerbated by tumbling oil prices. Cdn REITs materially lagged US REITs which returned +30%. Seepage 3for more deta

Relative Valuation Very Compelling: Cdn REITs are trading at 15.2x AFFO vs. the long-term average of 13.8x and a 6discount to NAV vs. a LTA premium of 3.4%. Cdn REITs now trade at a 5.9x discount to US REITs, one of the highest spreadsover 15 years. Spreads to the 10-yr bonds are at 506 bps vs. the LTA of 373 bps, the highest level since 795 bps seen in 2009.

Noteworthy News

6.5%

5.1%4.3%

3.5% 3.5%

0%

2%

4%

6%

8%

10%

DRM NWH.UN IIP.UN MEQ D.UN

Top 5 Performers Last Week

Index Comparison - Price Changes

2-Jan-15

Index

Value

Last

Wk

Last

Mth

Last

Qtr

Last

Year

% from A

Time Hig

S&P/TSX Capped REIT Index 159.36 0.0% -2.5% 0.9% 5.1% -10.6%

S&P/TSX Financials 253.27 -0.2% -2.0% 1.1% 9.3% -3.6%

S&P/TSX Composite 14,753.65 1.0% 0.9% -0.2% 8.5% -5.8%

S&P US Financials 333.41 -1.0% 1.4% 6.3% 13.8% -34.6%

S&P 500 2,058.20 -1.5% -0.4% 4.6% 12.3% -1.5%

MSCI US REIT Index 1,134.21 -0.1% 2.4% 14.2% 27.3% -8.1%

FTSE NAREIT Global Index 1,868.61 1.3% 3.1% 12.3% 27.1% 0.0%

Source: Thomson Baseline, Bloomberg, BMO Capital Markets

-3.4%

-2.9%-2.7%

-1.5% -1.3%

-4%

-3%

-2%

-1%

0%GRPU HLC WIR'U ACR.UN BEI.UN

Bottom 5 Underperformers Last Week

Dream Industrialannounced that Lenis Quan has been appointed as theREITs new CFO effective today. Ms. Quan has experience in real estateand the capital markets and was most recently the CFO of Gazit America.She replaces John Todd who is leaving for personal reasons.

H&R REIT insider buyback activity: three insiders spent a total of$935,835 buying back units during December, with President & CEOThomas Hofstedter responsible for most of the buying.

Axiometrics reported that the U.S. apartment market ended 2014 with thestrongest Q4 annual rent growth in nine years at 4.5% (preliminary

figures) vs. 4.1% in Q3/14 and 2.8% in Q4/13. This is the strongest Q4since 2005 (+ 5.8%).

According to an article in the Calgary Herald, Colliers estimates the recentsell-off in oil prices lifted Calgarys downtown office vacancy rate to 8.5%in Q4/14, up from 7.7% in Q3/14 and 7.3% in Q4/13. Q4 office absorptionwas negative 333,000 sf, with almost 200,000 sf in Class AA office.Colliers expects negative 500,000 sf of absorption in 2015 as companiestrim office requirements and sublet space. (Link to Calgary Herald Article).

The Globe & Mail reported that due to the growing number of energyplayers shelving expansion plans in the oil sands, lodging company CiveoCorp.s occupancy is roughly half of what it was this time last year, forcing

them to shut down work camps and lay off employees. (Link to Globe &Mails Article).

Heather Kirk, CFA(416) [email protected]

Troy MacLean, CFA(416) [email protected]

AssociatesMaria Benavente / Salim Ben Mansour / Zan Zhang(416) 359-6943 / (416) 359-7441 / (416) [email protected]/[email protected]/ [email protected]
http://calgaryherald.com/business/commercial-real-estate/calgary-downtown-office-market-faces-downturnhttp://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/oilfield-man-camp-operator-civeo-cuts-canadian-us-jobs-amid-oil-slump/article22236291/http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/oilfield-man-camp-operator-civeo-cuts-canadian-us-jobs-amid-oil-slump/article22236291/mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/oilfield-man-camp-operator-civeo-cuts-canadian-us-jobs-amid-oil-slump/article22236291/http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/oilfield-man-camp-operator-civeo-cuts-canadian-us-jobs-amid-oil-slump/article22236291/http://calgaryherald.com/business/commercial-real-estate/calgary-downtown-office-market-faces-downturn


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Sector Comment Financials - Real Estate/REIT

Page 2 January 6, 2015

Table of Contents

2014 REITs Performance Review ........................................................................................................................................... 3

Research Comparables ............................................................................................................................................................. 5

Implied Bond Yield Watch ....................................................................................................................................................... 6

Relative Performance

Total Return Performance Summary .......................................................................................................................................... 9

Price Performance Last Week, Month, Quarter, Year ........................................................................................................... 10

Valuation

Cdn REIT Current Valuation vs. Other Benchmark Indices .................................................................................................... 11

Canadian REIT Implied Cap Rates ........................................................................................................................................... 12

Historical Private Market Cap Rate Spreads to 10-yr GOC Bond and BBB Bonds by Property Type .................................. 13

Canadian REIT AFFO Yield Spreads ....................................................................................................................................... 14

Canadian REIT Historical AFFO Multiple .............................................................................................................................. 15

Cdn REIT Yield and Multiple Spread vs. U.S. REITS ............................................................................................................ 16

Cdn REIT Yield and Multiple Spread vs. Banks...................................................................................................................... 17

Cdn REIT Yield and Multiple Spread vs. Telecom ................................................................................................................. 18

Current 2014E AFFO Multiple vs. Historical Average ............................................................................................................ 19

Prem/Disc to NAV .................................................................................................................................................................... 20

Latest Disclosed IFRS Cap. Rates vs. Current Implied Cap. Rates ......................................................................................... 21

Other

Canadian Real Estate Mutual Fund Flows ............................................................................................................................ 22

Capital Raising & Cumulative Market Capitalization .............................................................................................................. 23

Capital Raising 2014 to 2015 YTD Summary ....................................................................................................................... 24

Canadian Real Estate M&A 2012 and 2013 YTD Deals and IPO Performances .................................................................... 26

Average Daily Trading Volume, Last Week and Last Six Months .......................................................................................... 27

Net Insider Activity ................................................................................................................................................................... 28

Financial Position Summary ..................................................................................................................................................... 29

Financial Position: Mortgage Maturity Schedule ..................................................................................................................... 30

Financial Position: Debt to Total Assets .................................................................................................................................. 31

REIT & REOC Convertible Debentures ................................................................................................................................... 32

REIT & REOC Preferred Shares .............................................................................................................................................. 33

2013 Return of Capital .............................................................................................................................................................. 34


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2014 REITs Performance Review

2014 REIT performance had a strong start in the first part of the year, but delivered a weak

finish. The S&P/TSX Capped REIT Index rose 9.2% to August 21, due in part to an unexpected

67 bps decline in 10-year GoC yields. From August 21 to year end, the index declined 4.6%

triggered initially on concerns that rates could move higher exacerbated by the impact of

tumbling oil prices.

The top performing REITsdelivered price appreciation of over 1530% and were dominated

by 1)U.S. weighted REITswhich benefitted from an appreciating USD as well as 2) seniors

housing and apartment REITswhich delivered above-average growth on solid fundamentals

and narrowing NAV discounts. Underperformers were down ~530% and tended to be

concentrated in the office market,which is grappling with new supply or to be weighted to

Western Canadawhich is forecast to face economic challenges due to plummeting oil prices.

Canadian REITs outperformed the S&P/TSX on a price performance basis by 200 bps in the

fourth quarter as energy stocks retreated from their earlier highs.

Quarterly Price PerformancePriced as at 31-Dec-2014

Name Q4 2014 Q3 2014 Q2 2014 Q1 2014 Q4 2013 Q3 2013 Q2 2013 Q1 2013

S&P/TSX Real Estate Index 4.5% 0.7% 3.5% 5.2% 3.7% -1.1% -4.3%

-0.2% -2.3% -4.4% -8.3%

-2.2% -1.2% -4.9%

-4.0% -1.8% -3.9% -2.5%

1.3%

S&P/TSX REIT Index 2.5% 4.3% 1.7% 0.3%

S&P/TSX Index 5.7% 5.2% 6.5% 5.4% 2.5%

MSCI US REIT Index 13.1% 6.0% 8.9% 7.1%

Source: Bloomberg, BMO Capital Markets

S&P/TSX REIT Index vs. S&P/TSX Composite Index - Total Annual Returns

80

90

100

110

120

130

140

Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14

TotalAnnualRe

turns(Indexedto100)

Canadian REIT Price Performance vs. US REITs and TSX Composite (Total Annual Returns)

S&P/TSX S&P/TSX REIT MSCI US REIT

Source: Bloomberg, BMO Capital Markets

Last Datapoint: December 31, 2014

MSCI US REIT

S&P/TSXComposite

S&P/TSX REITComposite


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Of note this year was the significant underperformance of Canadian REITs relative to U.S

REITs. The MSCI US REIT Index returned 30% in 2014 vs 10% for the S&P TSX REIT index

making it the worst year for Canadian REIT underperformance since 2000.

2014 Top and Worst Performers

Price ReturnsTotal Annual Returns

Source: BMO Capital Markets, Bloomberg, Thomson One

Priced as at December 31, 2014

-24%

-20%

-9%

-8%

-6%

-5%

-4%

-3%

-3%0%

0%

2%

3%

3%

3%

3%

4%

4%

6%

6%

6%

8%

9%

9%

9%

10%

10%

10%

11%

12%

12%

13%

15%

15%

16%

16%

16%

19%

19%

24%

25%

30%

31%

34%

36%

37%

-40% -20% 0% 20% 40%

PAR.UN

TPH

NPR.UN

ACC

RMM.UN

D.UN

F.UN

NWH.UN

MR.UNAAR.UN

PLZ.UN

CRR.UN

EXE

AX.UN

DIR.UN

HOT.UN

KMP

MEQ

CHP.UN

BOX.UN

TN.UN

HR.UN

ACR.UN

BEI.UN

CUF.UN

SMU.UN

REF.UN

FCR

DRG.UN

REI.UN

GRT.UN

MRG.UN

CWT.UN

BTB.UN

IIP.UN

MRT.UN

RUF'U

AP.UN

CRT.UN

CAR.UN

CSH.UN

LW

RLC

WIR'U

MST.UN

INN.UN

Source: BMO Capital Markets, Bloomberg, Thomson One

Priced as at December 31, 2014

-31%

-30%

-16%

-14%

-13%

-13%

-11%

-9%

-7%-6%

-5%

-5%

-5%

-5%

-4%

-3%

-2%

0%

0%

1%

1%

1%

2%

2%

3%

4%

5%

6%

6%

6%

7%

7%

8%

9%

10%

12%

14%

15%

18%

19%

19%

21%

23%

26%

28%

29%

-40% -30% -20% -10% 0% 10% 20% 30% 40%

PAR.UN

TPH

RMM.UN

NPR.UN

ACC

D.UN

NWH.UN

MR.UN

AAR.UNPLZ.un

HOT.UN

DIR.UN

CRR.UN

AX.UN

EXE

TN.UN

KMP

CHP.UN

ACR.UN

SMU.UN

CUF.UN

BOX.UN

HR.UN

DRG.UN

BEI.UN

MEQ

FCR

REF.UN

BTB.UN

MRG.UN

REI.UN

GRT.UN

RUF'U

CWT.UN

MRT.UN

IIP.UN

AP.UN

BPY-US

CAR.UN

CSH.UN

MRC

RLC

LW

WIR'U

INN.UN

MST.UN

Note: BMO Capital Markets is r estricted on Summit Industrial REIT and Tr ue North Commercial REIT

Top performers within our universe in 2014 were primarily comprised of REITs with exposureto robust economic growth in the U.S. (MST.UN and WIRU) as well as REITs in the senior

care/LTC sector (RLC and LW). The top five performing REITs were further elevated abovethe rest of the pack when accounting for distributions and had an average yield of 8-9%. Wecontinue to expect strong performance from both REITs with U.S. exposure given diminishedCanadian GDP projections and tumbling energy markets, and senior care/LTC REITs withfavourable tailwinds from market fundamentals and demographic trends.

Worst performers included REITs with exposure to Western Canada and softening economicconditions in the energy sector (TPH and NPR.UN), as well as REITs with operating challengeand leverage that is above-average (PAR.UN, RMM.UN, and ACC). We expect REITs withexposure to Western Canada as well as those with higher-than-average leverage to face greaterheadwinds for performance compared to peers.


5/36


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Sector Comment


A C D E F G H

(1 / C) (D - 1.74%) (D - F) (F + 2.16%)

AFFO - 10yr AFFO - 10yr Bond Yield Projected

Price 2015E AFFO Current Hist. Implied by Yield @

Coverage Universe 2-Jan-15 P/AFFO Yield Spread Spread Current Price 2.16%

Brookfield Cda. REIT $27.09 23.3x 4.3% 2.6% 3.1% 1.2% 5.2%

Allied Properties $37.68 19.0x 5.3% 3.5% 3.7% 1.5% 5.9%

Chartwell $11.86 15.9x 6.3% 4.6% 4.6% 1.7% 6.7%

CREIT $45.90 17.4x 5.8% 4.0% 3.8% 2.0% 5.9%

Leisureworld $14.02 10.3x 9.7% 8.0% 7.8% 1.9% 10.0%

PIRET $4.42 13.0x 7.7% 5.9% 5.4% 2.3% 7.6%

Retrocom $3.91 10.8x 9.2% 7.5% 6.9% 2.4% 9.0%

First Capital Realty $18.95 19.8x 5.0% 3.3% 2.6% 2.4% 4.8%

Morguard $18.09 13.5x 7.4% 5.7% 4.9% 2.5% 7.0%

Crombie $12.99 13.8x 7.2% 5.5% 4.6% 2.7% 6.7%

Calloway $27.48 14.4x 7.0% 5.2% 4.3% 2.7% 6.5%

RioCan $26.72 16.7x 6.0% 4.2% 3.2% 2.8% 5.4%

Killam Properties $10.31 14.9x 6.7% 5.0% 3.9% 2.9% 6.0%

Dream Industrial $8.43 10.6x 9.5% 7.7% 6.2% 3.3% 8.3%

Amica Mature Lifestyles $6.95 15.6x 6.4% 4.7% 3.3% 3.1% 5.5%

H&R $21.95 13.0x 7.7% 6.0% 4.4% 3.3% 6.6%

CAP REIT $25.33 17.0x 5.9% 4.2% 2.8% 3.1% 5.0%

NorthWest Healthcare Prop. $9.28 11.7x 8.6% 6.8% 4.9% 3.7% 7.0%

Boardwalk $62.04 19.0x 5.3% 3.5% 2.0% 3.3% 4.2%

Artis $14.35 11.5x 8.7% 7.0% 4.5% 4.2% 6.7%

Cominar $18.76 11.6x 8.6% 6.9% 4.5% 4.1% 6.6%

Northern Prop. $23.57 10.7x 9.4% 7.6% 4.5% 4.8% 6.7%

REIT Average 5.4% 4.4% 2.8% 6.5%

Source: BMO Capital Markets

AFFO yield spread over Canada

10-yr government bond


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Sector Comment

Implied Bond Yield - 10-year Canada Bond Yield Spreads:Monthly Spreads

1.7%

2.0%

3.0%3.2%

3.3%

3.1%

2.9%

3.1% 3.1%

2.9%2.7%

2.8%2.6%

2.5%2.4%

2.7%2

1.70%

2.06%

2.44% 2.45%2.62% 2.56%

2.42%2.55%

2.79%

2.34%2.43% 2.44% 2.41%

2.30% 2.25%2.11%

1

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Au

Implied Bond Yield 10-yr Bond Yield

Source: BMO Capital Markets, Bloomberg, Thomson One (Priced as at January 2, 2015)

Weekly Spreads

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

1.60%

Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Se

Source: BMO Capital Markets, Bloomberg, Thomson One (Priced as at January 2, 2015)



9/36

Sector Comment

Relative Performance:Total Return Performance Summary

2015 YTD

2014

2013

2012

By Benchmark By Property Type By Mark

29.8%

17.8%

17.0%

7.2%

0% 10% 20% 30% 40%

Global REITs

US REITs

Cdn REITs

TSX Composite

Total Return

2.2%

2.5%

-5.5%

13.0%

-13% -8% -3% 2% 7% 12% 17%

Global REITs

US REITs

Cdn REITs

TSX Composite

Total Return

15.7%

-5.0%

-1.7%

-1.7%

-3.4%

-6.0%

-4.4%

-15% -10% -5% 0% 5% 10% 15% 20%

Hotel

Retirement/LTC

Diversified

Industrial

Office

Retail

Multi-Residential

Total Return

10%

33%

21%

23%

25%

15%

24%

0% 5% 10% 15% 20% 25% 30% 35%

Hotel

Retirement/LTC

Diversified

Industrial

Office

Retail

Multi-Residential

Total Return

-7.6%

-14% -12% -10% -8%

Large Cap (>$1.5 B)

Mid Cap ($500 M - $1.5B)

Small Cap ($1.5 B)

Mid Cap ($500 M -$1.5B)

Small Cap ($1.5 B)

Mid Cap ($500 M - $1.5B)

Small Cap ($1.5 B)

Mid Cap ($500 M - $1.5B)

Small Cap (


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Price Performance:By Index and Name Last Week, Month, Quarter, Year

Price Change: Last Week Price Change: Last Month Price Change: Last 3 Months Price Change: Last 12 Months

REIT/REOC Ticker REIT/REOC Ticker REIT/REOC Ticker REIT/REOC Ticker

Dream Unlimited DRM 6.5% InnVest INN.UN 6.6% Brookfield Asset Mgmt (C$) BAM.A 17.2% Holloway HLC 53.3%

Northwest Healthcare Prop. NWH.UN 5.1% Tricon Capital TCN 6.2% Tricon Capital TCN 14.6% Brookfield Asset Mgmt (C$) BAM.A 43.4%

InterRent IIP.UN 4.3% Brookfield Asset Mgmt (C$) BAM.A 3.7% MSCI US REIT Index 14.2% Brookfield Asset Mgmt (US$) BAM 30.3%

Mainstreet Equity MEQ 3.5% FTSE NAREIT Global Index 3.1% Brookfield Property Part. BPY.UN 13.4% Milestone MST.UN 29.7%

Dream Office D.UN 3.5% MSCI US REIT Index 2.4% FTSE NAREIT Global Index 12.3% Brookfield Property Part. BPY.UN 27.9%

Milestone MST.UN 3.2% Regal RLC 2.2% Brookfield Asset Mgmt (US$) BAM 12.2% MSCI US REIT Index 27.3%

Dream Industrial DIR.UN 3.1% Brookfield Property Part. BPY.UN 2.1% InnVest INN.UN 10.6% WPT Industrial WIR'U 27.3%

Brookfield Asset Mgmt (C$) BAM.A 2.5% Leisureworld LW 2.0% Allied Properties AP.UN 10.3% FTSE NAREIT Global Index 27.1%

Tricon Capital TCN 2.5% Temple TPH 1.8% Granite Real Estate (C$) GRT.UN 9.6% InnVest INN.UN 25.3%

Cominar CUF.UN 2.3% American Hotel HOT.UN 1.8% Chartwell CSH.UN 8.8% Leisureworld LW 24.8%

H&R HR.UN 1.9% First Capital Realty FCR 1.7% InterRent IIP.UN 8.6% CAP REIT CAR.UN 19.9%

Regal RLC 1.8% Northwest Healthcare Prop. NWH.UN 1.6% CT REIT CRT.UN 8.5% Morguard Corp. MRC 19.1%

PIRET AAR.UN 1.8% Extendicare EXE 1.5% First Capital Realty FCR 7.8% Chartwell CSH.UN 19.1%

Leisureworld LW 1.7% Morguard MRT.UN 1.1% Calloway CWT.UN 7.4% Tricon Capital TCN 17.2%

InnVest INN.UN 1.6% S&P/TSX Composite* 0.9% WPT Industrial WIR'U 7.2% Regal RLC 16.4%

RetroCom RMM.UN 1.6% Granite Real Estate (C$) GRT.UN 0.5% CAP REIT CAR.UN 6.9% Allied Properties AP.UN 15.1%

Amica Mature Lifestyles ACC 1.6% Crombie CRR.UN 0.4% Regal RLC 5.3% InterRent IIP.UN 13.1%

Dream Global DRG.UN 1.5% Brookfield Asset Mgmt (US$) B AM 0.2% RioCan REI.UN 4.3% CT REIT CRT.UN 10.6%

Brookfield Canada (US$) BOXC 1.4% Morguard Residential MRG.UN 0.2% Granite Real Estate (US$) GRPU 4.3% Morguard MRT.UN 10.4%

Morguard Residential MRG.UN 1.3% Cominar CUF.UN 0.2% Morguard Corp. MRC 3.8% Calloway CWT.UN 9.7%

FTSE NAREIT Global Index 1.3% WPT Industrial WIR'U 0.0% Leisureworld LW 3.8% S&P/TSX Composite* 8.5%

CAP REIT CAR.UN 1.2% Inovalis INO.UN 0.0% Choice Properties CHP.UN 2.9% First Capital Realty FCR 8.2%

Allied Properties AP.UN 1.2% RioCan REI.UN -0.5% Milestone MST.UN 2.5% RioCan REI.UN 7.5%

Brookfield Canada (C$) BOX.UN 1.1% Dream Global DRG.UN -0.8% Holloway HLC 1.2% Granite Real Estate (C$) GRT.UN 7.3%

Crombie CRR.UN 1.0% Mainstreet Equity MEQ -0.8% H&R HR.UN 0.9% CREIT REF.UN 6.5%

S&P/TSX Composite* 1.0% Amica Mature Lifestyles ACC -1.1% Amica Mature Lifestyles ACC 0.9% Morguard Residential MRG.UN 6.0%

Melcor Developments MRD 0.9% BTB BTB.UN -1.3% S&P/TSX Capped REIT ** 0.9% BTB BTB.UN 5.6%

Extendicare EXE 0.9% InterRent IIP.UN -1.3% Crombie CRR.UN 0.7% S&P/TSX Capped REIT ** 5.1%

Killam Properties KMP 0.5% Allied Properties AP.UN -1.4% Killam Properties KMP -0.1% Boardwalk BEI.UN 4.2%Brookfield Asset Mgmt (US$) BAM 0.5% CAP REIT CAR.UN -1.5% Brookfield Canada (C$) BOX.UN -0.2% Mainstreet Equity MEQ 3.3%

Choice Properties CHP.UN 0.5% Morguard Corp. MRC -1.6% PIRET AAR.UN -0.2% H&R HR.UN 2.9%

BTB BTB.UN 0.4% Chartwell CSH.UN -1.6% S&P/TSX Composite* -0.2% Summit Industrial SMU.UN 2.7%

American Hotel HOT.UN 0.3% Calloway CWT.UN -1.6% Cominar CUF.UN -0.4% Brookfield Canada (C$) BOX.UN 2.6%

First Capital Realty FCR 0.1% CT REIT CRT.UN -1.9% Morguard MRT.UN -1.0% Cominar CUF.UN 2.1%

Artis AX.UN 0.1% Milestone MST.UN -1.9% Morguard Residential MRG.UN -1.7% Inovalis INO.UN 1.0%

Summit Industrial SMU.UN 0.0% PIRET AAR.UN -2.0% BTB BTB.UN -2.7% Choice Properties CHP.UN 0.9%

Calloway CWT.UN 0.0% Killam Properties KMP -2.1% Summit Industrial SMU.UN -3.8% Agellan Commercial ACR.UN -0.9%

S&P/TSX Capped REIT ** 0.0% RetroCom RMM.UN -2.2% Agellan Commercial ACR.UN -4.7% Dream Global DRG.UN -1.1%

MSCI US REIT Index RMZ -0.1% S&P/TSX Capped REIT ** -2.5% Northwest Healthcare Prop. NWH.UN -4.7% Killam Properties KMP -1.4%

Temple TPH -0.2% Granite Real Estate (US$) GRPU -2.6% CREIT REF.UN -4.8% Granite Real Estate (US$) GRPU -1.9%

CREIT REF.UN -0.2% H&R HR.UN -2.7% American Hotel HOT.UN -4.9% Artis AX.UN -2.8%

Morguard Corp. MRC -0.3% Brookfield Canada (C$) BOX.UN -2.9% Brookfield Canada (US$) BOXC -4.9% Extendicare EXE -3.2%

Partners PAR.UN -0.3% Boardwalk BEI.UN -3.4% Dream Global DRG.UN -5.4% Melcor Developments MRD -3.7%

Northern Prop. NPR.UN -0.5% Agellan Commercial ACR.UN -4.0% Mainstreet Equity MEQ -5.8% Crombie CRR.UN -4.0%

Granite Real Estate (C$) GRT.UN -0.6% Summit Industrial SMU.UN -4.0% Artis AX.UN -6.1% American Hotel HOT.UN -4.6%

Morguard MRT.UN -0.6% Choice Properties CHP.UN -4.5% Inovalis INO.UN -7.0% Dream Industrial DIR.UN -4.7%

RioCan REI.UN -0.6% Dream Industrial DIR.UN -4.5% Dream Industrial DIR.UN -7.1% PIRET AAR.UN -5.6%

CT REIT CRT.UN -0.7% Dream Office D.UN -4.6% RetroCom RMM.UN -8.2% Brookfield Canada (US$) BOXC -6.4%

Chartwell CSH.UN -0.9% Holloway HLC -5.4% Dream Office D.UN -8.3% Northwest Healthcare Prop. NWH.UN -11.0%

Inovalis INO.UN -1.0% CREIT REF.UN -5.6% Partners PAR.UN -8.6% Dream Office D.UN -11.5%

Brookfield Property Part. BPY.UN -1.2% Brookfield Canada (US$) BOXC -6.3% Boardwalk BEI.UN -10.3% Amica Mature Lifestyles ACC -13.6%

Boardwalk BEI.UN -1.3% Northern Prop. NPR.UN -7.2% Temple TPH -15.6% RetroCom RMM.UN -15.9%

Agellan Commercial ACR.UN -1.5% Dream Unlimited DRM -7.4% Northern Prop. NPR.UN -16.1% Northern Prop. NPR.UN -17.1

WPT Industrial WIR'U -2.7% Melcor Developments MRD -7.9% Melcor Developments MRD -19.8% Temple TPH -29.4%

Holloway HLC -2.9% Artis AX.UN -8.2% Extendicare EXE -19.9% Partners PAR.UN -30.7%

Granite Real Estate (US$) GRPU -3.4% Partners PAR.UN -11.7% Dream Unlimited DRM -21.2% Dream Unlimited DRM -40.6%

Simple Avg - All Real Estate 0.8% Simple Avg - All Real Estate -1.6% Simple Avg - All Real Estate -0.4% Simple Avg - All Real Estate 5.1%

Source: Thomson Baseline, Bloomberg, BMO Capital Markets

Last Datapoint: January 2, 2015

Note: BMO Capital Markets is Restricted on Summit Industrial REIT and True North Commercial REIT


11/36



Valuation Comparisons:Cdn REIT Current Valuation vs. Other Benchmark Indices

-3.6x

0.8x4.3x

-2.4x 0.0x

-5.9x

1.2x

4.3x

-3.4x

0.3x

-8x

-6x

-4x

-2x

0x

2x

4x

6x

US REITs S&P/TSX Comp Cdn Banks Cdn Utilities Cdn Telecom

Premium/(Discount)-MultipleSpreadinPoints

Historical Spread

Current Spread

Note: Historical averages since 2004Source: BMO Capital Markets, Bloomberg

15

40

65

90

115

140

Dec-06 Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14

PriceOnlyPerformance(Indexedto100)

Canadian REIT Price Performance vs. US REITs and TSX Composite

Source: Bloomberg, BMO Capital MarketsLast Datapoint: January 2, 2015

MSCI US REIT

S&P/TSXComposite

Cdn REITs TroughValuation (Mar/09): Forward

AFFO multiple 9.3x (8.7%implied cap rate)

Cdn REITs PeakValuation (Q1/07):Fwd AFFO multiple

almost 20x(6% implied cap rate)

Cdn REITs CurrentValuation: 2015E AFFOmultiple 15.3x

(6.2% implied cap rate)

Implied Cap RateSpread to Gov'ts: 190 bps*

Implied Cap RateSpread to Gov'ts: 590 bps*

* Min/Max Cap Rate Spread was in Q3/07 (at 170 bps) and Q3/09 (at 590 bps)

Current Implied Cap RateSpread to Gov'ts: 448 bps

S&P/TSX REIT

Composite


12/36



Valuation Comparisons: Canadian REIT Implied Cap Rate Spreads

0%

1%

2%

3%

4%

5%

6%

7%

Q1/98 Q3/99 Q1/01 Q3/02 Q1/04 Q3/05 Q1/07 Q3/08 Q1/10 Q3/11 Q1/13 Q3/14

Canadian REIT Implied Cap Rate* Spread to 10 Year Gov't Bond Yields

Current Spread: 448 bps

Source: BMO Capital MarketsLast Datapoint: January 2, 2015

* Private market data was used for Q1/98-Q4/05 Implied Cap Rate;wtd avg of All Cdn REITs used thereafter

Long Term Historical Avg. Spread: 363 bps

Q3/07 Min Spread: 171 bps

Q1/09 Max Spread: 587 bps

0%

1%

1%

2%

2%

3%

3%

4%

4%

Q1/98 Q3/99 Q1/01 Q3/02 Q1/04 Q3/05 Q1/07 Q3/08 Q1/10 Q3/11 Q1/13 Q3/14

Canadian REIT Implied Cap Rate* Spread to 10 Year BBB Corp Bond Yields


Source: BMO Capital MarketsLast Datapoint: January 2, 2015

Long Term Historical Avg. Spread: 188 bps

Q3/07 Min Spread: 41 bps

Q4/03 Max Spread: 349 bps

* Private market data was used for Q1/98-Q4/05 Implied Cap Rate;wtd avg of All Cdn REITs used thereafter


13/36



Historical Private Market Cap Rate Spreads to 10-yr GOC Bond andBBB Bonds by Property Type

Private Market Data:

Population-Weighted Average National Private Market Historical Cap. Rate & Spread to C anadian 10 Year Gov't Bonds a nd BBB C orporates1

CBD Office Suburban Office A&B2 Industrial A&B Retail -Neighborhood Apartment -High Rise3 Na tiona l Spre ad Spre ad

Ave Cap Spread Ave Cap Spread Ave Cap Spread Ave Cap Spread Ave Cap Spread Average to 10-yr GOC Bond to BBB Bond

1992 9.4% 1.3% 10.8% 2.7% 10.6% 2.5% 10.2% 2.1% 9.8% 1.7% 10.1% 2.1% 0.2%

1993 9.6% 2.4% 11.4% 4.2% 10.7% 3.5% 10.3% 3.1% 10.2% 2.9% 10.4% 3.2% 1.9%

1994 9.8% 1.3% 11.0% 2.6% 10.5% 2.0% 10.3% 1.8% 10.8% 2.3% 10.5% 2.0% 1.2%

1995 9.6% 1.6% 12.3% 4.2% 10.3% 2.2% 10.2% 2.2% 10.7% 2.6% 10.6% 2.6% 1.4%

1996 9.4% 2.2% 10.3% 3.1% 9.9% 2.7% 10.4% 3.2% 8.6% 1.4% 9.7% 2.5% 1.5%

1997 8.9% 2.7% 10.4% 4.3% 9.5% 3.4% 9.8% 3.7% 8.9% 2.8% 9.5% 3.4% 2.4%

1998 8.6% 3.3% 9.2% 4.0% 9.3% 4.0% 9.4% 4.1% 8.5% 3.2% 9.0% 3.7% 2.6%

1999 8.8% 3.2% 9.0% 3.4% 9.3% 3.7% 9.6% 4.0% 8.3% 2.7% 9.0% 3.4% 1.9%

2000 9.1% 3.2% 9.6% 3.7% 9.6% 3.7% 9.8% 4.0% 8.1% 2.2% 9.2% 3.4% 1.6%

2001 8.7% 3.2% 10.0% 4.5% 9.5% 4.0% 9.8% 4.3% 7.9% 2.5% 9.2% 3.7% 1.6%

2002 8.6% 3.3% 10.1% 4.8% 9.4% 4.1% 10.0% 4.8% 7.6% 2.4% 9.1% 3.9% 1.9%

2003 9.0% 4.2% 10.5% 5.7% 9.2% 4.4% 9.9% 5.2% 7.7% 2.9% 9.2% 4.5% 3.1%

2004 8.6% 4.1% 9.6% 5.1% 8.2% 3.7% 8.5% 3.9% 7.3% 2.8% 8.5% 3.9% 2.8%

2005 7.4% 3.4% 9.2% 5.2% 7.5% 3.5% 7.6% 3.6% 6.8% 2.8% 7.7% 3.7% 2.6%

2006 6.6% 2.4% 7.5% 3.3% 7.1% 2.9% 7.2% 3.0% 6.5% 2.3% 7.0% 2.8% 1.7%

2007 6.3% 2.1% 6.9% 2.6% 6.8% 2.5% 6.9% 2.6% 5.8% 1.6% 6.5% 2.3% 0.9%

2008 6.6% 3.0% 7.3% 3.7% 6.8% 3.2% 7.3% 3.7% 6.1% 2.5% 6.8% 3.2% 0.5%

2009 7.4% 4.2% 8.2% 5.0% 8.0% 4.8% 8.2% 5.0% 6.5% 3.3% 7.7% 4.5% 1.5%

2010 6.9% 3.7% 7.9% 4.6% 7.5% 4.3% 7.4% 4.2% 6.3% 3.0% 7.2% 4.0% 2.2%

2011 6.2% 3.4% 7.3% 4.5% 7.0% 4.2% 6.9% 4.1% 5.8% 3.1% 6.6% 3.9% 1.8%

2012 5.7% 3.8% 6.9% 5.0% 6.7% 4.8% 6.5% 4.7% 5.1% 3.2% 6.2% 4.3% 2.0%

Q1/13 5.6% 3.8% 6.7% 4.9% 6.5% 4.6% 6.4% 4.5% 4.9% 3.1% 6.0% 4.2% 2.1%

Q2/13 5.6% 3.2% 6.9% 4.4% 6.5% 4.1% 6.4% 3.9% 4.9% 2.5% 6.1% 3.6% 1.5%

Q3/13 5.7% 3.1% 6.9% 4.3% 6.6% 4.1% 6.4% 3.9% 4.9% 2.4% 6.1% 3.6% 1.5%

Q4/13 5.7% 2.9% 6.9% 4.1% 6.6% 3.9% 6.4% 3.7% 5.2% 2.4% 6.2% 3.4% 1.5%

2013 5.6% 3.2% 6.8% 4.4% 6.6% 4.2% 6.4% 4.0% 5.0% 2.6% 6.1% 3.7% 1.7%

Q1/14 5.7% 3.3% 6.9% 4.4% 6.6% 4.2% 6.4% 4.0% 5.2% 2.7% 6.2% 3.7% 2.0%

Q2/14 5.7% 3.5% 6.9% 4.6% 6.5% 4.3% 6.4% 4.2% 5.2% 2.9% 6.1% 3.9% 2.4%

Q3/14 5.7% 3.6% 6.8% 4.6% 6.4% 4.3% 6.4% 4.3% 5.1% 3.0% 6.1% 3.9% 2.3%Current5 5.7% 4.0% 6.8% 5.0% 6.4% 4.7% 6.4% 4.7% 5.1% 3.4% 6.1% 4.4% 2.5%

Historical Average : 8.2% 3.0% 9.3% 4.1% 8.7% 3.5% 8.9% 3.7% 7.8% 2.6% 8.6% 3.4% 1.8%

Last 10 Year Average: 7.2% 3.4% 8.3% 4.5% 7.7% 3.9% 7.9% 4.1% 6.5% 2.7% 7.5% 3.7% 1.9%

Historical Max Spread: Gov't Bonds - 2003 (446 bps); BBB Corps - 2003 (314 bps)

Historical Min Sprea d: Gov't Bonds - 1992 (206 bps)/1994 (202 bps)/ 2007 (228 bps); BBB Corps - 1992 (22 bps)/ 2008 (50 bps)

National Includes: Vancouver, Calgary, Edmonton, Toronto, Ottawa, Montreal, Halifax 4

Source: Bloomberg, CBRE, Reuters, BMO Capital Markets

1. Annual 10 year bond yields represents the average of each trading day's close f or the year.

2. Suburban Office cap rates pre-2007 are estimated

3. 1992-1999 Apartment cap rates estimated

4. 1989-1999 & 2004 Exclude Ottawa & Halifax for w hich cap rates were not available

5. Current reflects latest available average cap. rates (Q3/14) and bond yields as of January 2, 2015

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

Apr-08 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Aug-14

Canadian 10-yr Government Bond Yield

As at January 2, 2015 1.74%

Source: BMO Capital Markets, Thomson Baseline


14/36



Valuation:Canadian REIT AFFO Yield Spreads

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

Dec-98 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-1

Canadian REIT AFFO Yields Spread to 10-Year Cda Gov't Yields

Hist. Avg Spread: 373 bps


Min spread: 66 bps

Maxspread:795 bps

Source: BMO Capital Markets, BloombergLast Datapoint: January 2, 2015

Spreads to 10-year Canadayields are currently ~133 bpsabove the historical average.

.

-1%

0%

1%

2%

3%

4%

5%

Dec-98 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-1

Canadian REIT AFFO Yields Spread to BBB Corporate Bond Yields

Hist. Average Spread: 194 bps


Min spread: - 60 bps

Max spread:476 bps

Source: BMO Capital Markets, BloombergLast Datapoint: January 2, 2015


15/36



4%

5%

6%

7%

8%

9%

10%

11%

12%

Mar-05 Nov-05 Jul-06 Mar-07 Nov-07 Jul-08 Mar-09 Nov-09 Jul-10 Mar-11 Nov-11 Jul-12 Mar-13 Nov-13 Jul-14

Canadian REIT AFFO Yield vs. S&P/TSX Composite Earnings Yield

Cdn REITs AFFO Yield S&P/TSX Composite Earnings YieldSource: Bloomberg, BMO Capital MarketsLast Datapoint: January 2, 2015


Peak Spread: 266 bps

Valuation:Canadian REIT Historical AFFO Multiple

4x

6x

8x

10x

12x

14x

16x

18x

20x

22x

24x

26x

Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14

AFFOMultiple

Canadian REIT Historical AFFO Multiple

Source: BMO Capital Markets* Pre-2006 Historical #s include RioCan, CREIT, H&R, Summit, Cominar and CAP; Fwd #s include all REITs in our coverage universeLast datapoint: January 2, 2015

Average ForwardAFFO Multiple = 13.8x

Peak = 19.7x

Current = 15.3


16/36



Valuation:Canadian REIT Yield and Multiple Spread to U.S. REITs

(8)

(6)

(4)

(2)

-

2

4

Dec-98 Q3/02 May-05 May-06 May-07 May-08 May-09 May-10 May-11 May-12 May-13 May-14

MultipleSpread(Points)

Fwd AFFO Multiple Spread: Canadian vs. US REITs

Mult iple Spread (Point s) Hist. Average Multiple Spread


Current Discount: -5.9 pts

Hist. Average (Forward) Spread : -3.5 points


Canadian REIT valuationsare now very compellingrelative to their U.S.counterparts.

Canadian REITs trade at anaverage discount to U.S.REITs of ~6x P/AFFO.

-2

-1

0

1

2

3

4

5

6

Jan-06 Sep-06 May-07 Jan-08 Sep-08 May-09 Jan-10 Sep-10 May-11 Jan-12 Sep-12 May-13 Jan-14 Sep-14

Spread(%)

Yield Spread: Canadian REITs vs. US REITs

Last pricing date: January 2, 2015Source: BMO Capital Markets, Bloomberg

Hist. Avg = 192 bps

peak differential: 355 bps

current differential: 204 bp

trough differential: -66 bps


17/36



Valuation:Canadian REIT Yield and Multiple Spread to Banks

(5)

(3)

(1)

1

3

5

7

9

Dec-98 Q3/02 May-05 May-06 May-07 May-08 May-09 May-10 May-11 May-12 May-13 May-14


Multiple Spread: Cdn REITs (Fwd AFFO) vs. Banks (P/E)

Multiple Spread (Points)

Hist. Average Multiple Spread


Current Premium: 4.3 pt

Hist. Average (Forward) Spread : 4.3 points


0

1

2

3

4

5

6

7

8


Spread(%)

Yield Spread: Canadian REITs vs. Banks

current differential: 185 bp

Last pricing date: January 2, 2015Source: Bloomberg, BMO Capital Markets


Hist. Avg = 232 bps

trough differential: 44 bps


18/36



Valuation:Canadian REIT Yield and Multiple Spread to Telecom

(15)

(10)

(5)

-

5

10

Q2/02 Q4/03 Apr-05 Oct -05 Apr-06 Oct -06 Apr-07 Oct-07 Apr-08 Oct -08 Apr-09 Oct -09 Apr-10 Oct -10 Apr-11 Oct -11 Apr-12 Oct -12 Apr-13 Oct -13 Apr-14 Oct -14


Multiple Spread: Cdn REITs (Fwd AFFO) vs. Telecom (P/E)

Multiple Spread (Points)

Hist. Average Multiple Spread


Current Premium: 0.3 pts

Hist. Average (Forward) Discount : 0.0 points


-1

0

1

2

3

4

5

6

7

8

9

10


Spread(%)

Yield Spread: Canadian REITs vs. Telecom

Last pricing date: January 2, 2015Source: Bloomberg, BMO Capital Markets


Hist. Avg = 147 bpscurrent differential: 95 bp

trough differential: -12 bps


19/36



Relative Valuation:Current 2015E AFFO Multiple vs. Historical Average

14.3x 14.5x14.1x

19.9x

10.7x

16.0x

8.7x

16.9x

9.3x

11.5x 11.6x

13.8x

17.7x

13.4x 13.5x

10.4x

13.3x

18.9x

23.3x

12.0x

19.0x

17.0x

15.3x

17.0x

11.9x

10.8x

15.6x 15.9x

10.3x

11.9x

0x

2x

4x

6x

8x

10x

12x

14x

16x

18x

20x

22x

24x

26x

CHP

CWT

0.4x

CRR

0.3x

FCR

2.3x

RMM

-0.6x

CRT

SRT

REI-0.5x

ACR

AX

-2.3x

CUF-2.2x

MRT0.6x

REF

2.3x

HR

-0.1x

AAR

1.5x

DIR

-1.7x

WIR

AP

3.9x

BOX

5.6x

NWH

-2x

BEI0.3x

CAR

1.3x

KMP

-0.4x

IIP

0.9x

MST

NPR

-2.5x

ACC

-0.9x

CSH

2.6x

LW

0.1x

R L C

0 9

Retail Diversified Industrial Office Multi-residential Seniors

His tori ca l Average Current 2015E AFFO Mult ip le

Current 2015E AFFO Multiple vs. Historical Average


Spread

Note:1) Hist avg. multiples are reflective of predecessor company multiple for BOX.UN up until conversion to a REIT in May 2010.2) CHP, ACR, CRT, SRT, WIR, MST and SMU (Restricted) historical averages not presented due to relatively shorter history.3) IIP.UN, MST.UN, and RLC historical averages are based on available information since coverage initiation.

14.9x

13.9x

15.6x

12.1x

15.9x

12.8x

14.4x

12.9x

18.1x

11.9x

15.2x

13.4x

0x

2x

4x

6x

8x

10x

12x

14x

16x

18x

20x

Retail Diversified Office Industrial Multi-Residential Seniors

2015E AFFO Multiples by Property Type: Current vs. Historical Average

Hist Average Current AverageSource: BMO Capital Markets


20/36



Relative Valuation:Prem/(Disc) to NAV

2%

-7%

-9%

0%

-22%

8%

-14%

4%

-19%

-15%

-9%

-20%

1%

-13%

-4%

-19%

2%

8%

-18%

-9%

-13%

-5%

-16%

-7%

-19%-18%

-16%

4%

14%

3%

-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

CHP

CWT

-6.8

%

CRR

-3.4

%

FCR

1.2

%

RMM

-13.8

%

CRT

SRT

REI

-4.7

%

ACR

AX

-10.1

%

CUF

-11.4

%

MRT

-1.4

%

REF

-3.6

%

HR

-5.7

%

AAR

-6.5

%

DIR

-7.6

%

WIR

AP

4.4

%

BOX

0.1

%

NWH

-10.2

%

BEI

-14.8

%

CAR

-5.1

%

KMP

-8.2

%

IIP

3.9

%

MST

NPR

-23.3

%

ACC

-4.5

%

CSH

3.1

%

LW

9.8

%

R L C

3 6

%


Historical NAV Prem/Disc (Median) Current NAV Prem/Disc

Source: BMO Capital Markets, SNL Financial

Spread

*Historical NAV Prem/Disc median based on latest coverage universe or consensus data, since later of 2006 or IPO.ACR, MST, WIR, CRT, SRT, CHP and SMU (Restricted) historicals were excluded due to shorter duration.

Current vs. Historical Premium/Discount to NAV

-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

Dec-97

Apr-98

Aug-98

Dec-98

Apr-99

Aug-99

Dec-99

Apr-00

Aug-00

Dec-00

Apr-01

Aug-01

Dec-01

Apr-02

Aug-02

Dec-02

Apr-03

Aug-03

Dec-03

Apr-04

Aug-04

Dec-04

Apr-05

Aug-05

Dec-05

Apr-06

Aug-06

Dec-06

Apr-07

Aug-07

Dec-07

Apr-08

Aug-08

Dec-08

Apr-09

Aug-09

Dec-09

Apr-10

Aug-10

Dec-10

Apr-11

Aug-11

Dec-11

Apr-12

Aug-12

Dec-12

Apr-13

Aug-13

Dec-13

Apr-14

Aug-14

Historical Prem/(Disc) to NAV ChartCanadian REITs - Weighted Average

Long-Term Average NAV Premium: 3.4%

Peak NAVPremium: 29.5%

Trough NAVDiscount: -22.7%

Source: BMO Capital MarketsLast datapoint: January 2, 2015

Current NAV Discount: -6.0%

NAV Discount:-19.3%

NAV Discount:-14.0%


21/36



Relative Valuation:Latest Disclosed IFRS Cap Rates vs. Current Implied Cap Rates

6.0% 6.3%

6.5%

5.8%

7.5%

6.0%

7.9%

5.7%

8.2%

7.0%6.9% 7.0%

6.0%

6.5%6.6%

7.4%

6.9%

5.8%

6.1%

7.0%

5.6%

5.2%

6.4%

5.6%

7.1%

8.0%

7.2%

6.8%

8.2%

7.1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

CHP CWT CRR FCR RMM CRT SRT REI ACR AX CUF MRT REF HR AAR DIR WIR AP BOX NWH BEI CAR K MP IIP MST NPR ACC CSH LW RLC


Implied Cap Rate IFRS Cap Rate

Implied Cap Rates vs. Latest Disclosed IFRS Cap Rates


*CSH.UN, RLC, LW, and ACC do not provide IFRS fair value cap rate updates.

Notes:1. CAR and KMP IFRS Cap Rates are est imated based on property weightings of apartments and MHCs.2. IFRS Cap Rates reflect latest reported quarter.


22/36



Canadian Real Estate Mutual Fund Flows

(100.00)

(50.00)

-

50.00

100.00

150.00

200.00

250.00

300.00

May-00 May-01 May-02 May-03 May-04 May-05 May-06 May-07 May-08 May-09 May-10 May-11 May-12 May-13 May-14

(Cdn$mil)

Mutual Fund Flows (Net Sales): Real Estate

Real Es tate Funds 12-month Normalized

Source: IFIC, BMO Capital Markets*12 month-rolling period normalized for peaks caused by Feb/March RRSP season Last Update: Dec/14

Funds Tracked for Mutual Fund FlowsAntares Real Estate Pool Fund Class A Manulife Global Real Estate Class Advisor Series

ASTRA Morgan Stanley Global Real Estate Manulife Global Real Estate Fund Advisor Series

ASTRA Presima Global Real Estate Enhanced Yield MFS Global Real Es tate Fund

BlackRock CDN Glbl Dev Real Est Idx Cl D Middlefield Can-Global REIT Income Fund

BMO Equal Weight REITs Index ETF (ZRE) Middlefield Real Estate Clas s Series A

BMO Equal Weight REITs Index ETF Inst MLI Pyramis Global Real Estate Fund

CDSPI Global Real Estate (Invesco) North American REIT Income Fund

Centurion Apartment REIT Purpose Duration Hedged Real Estate ETF (PHR)CIBC Canadian Real Estate Fund Purpose Duration Hedged Real Estate Fund A

Counsel Global Real Estate Series A Quadrus Global Real Estate Fund (London Cap) Quad

Des jardins Global Real Es tate Fund A Class REIT IndexP lus Income Fund

DFA Global Real Estate Securities Fund Class A Renaissance Global Real Estate Currency Neut Fd A

DFS B lackrock Global Real Estate Index Renais sanc e Global Real Es tate Fund Class A

Dynamic Global Real Estate Fund Series A Russ ell Global Real Es tate Pool Series A

Fidel ity Global Real Es tate Class Series A Scot ia Private Global Real Es tate Pool Pinnac le Sr

Fidelit y Global Real Estate Fund Series A Scot ia Private Real Es tate Income Pool I

First Asset Canadian REIT ETF (FRF) Sentry REIT Class Series A

First Asset REIT Income Fund Class A Sentry REIT Fund A

IA Ecoflex Real Estate Income Sprott Real Asset Class - Series A

Invesco Global Real Es tate Fund Series A Standard Life Global Real Es tate Fund A-Series

Investors Global Real Estate Fund Series C United Real Estate Investment Corporate Class A

iShares Global Real Estate Index ETF (CGR) United Real Estate Investment Pool Class W

iShares S&P/TSX Capped REIT Index ETF (XRE) Vanguard FTSE Canadian Capped REIT Index ETF (VRE)

as at December 2014


23/36



Canadian REITs Capital Raising and Market Capitalization Growth

$48 $55

$681

$2,961

$1,261

$467 $367

$1,869

$2,295

$1,792

$2,615

$3,710

$3,160$3,450

$980

$4,475

$5,588

$6,785

$10,449

$9,662

$9,135

$0

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

$5,000

$5,500

$6,000

$6,500

$7,000

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

(C$millions)

Canadian Real Estate Capital Raising (1) 1994-2015 YTD

Equity (2) Convert ib le Debentures Unsecured Debentures Secured Mortgage Bonds Secured Debentures

Source: SEDAR, BMO Capital Markets

1) 2007+ incl. REIT & REOC capital raising; 1994-2006 includes REIT capital raising only2) Equity includes preferred shares/units in 2007-2014YTD where applicable (ie. BPO, RioCan)

2014 Total: $9,135 million

Secured Debentures:$322 million

Unsecured Debentures:$5,525 million

Convertible Debentures:$93 million

Preferred Equity:$300 million

Equity Issues:$2,895 million

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Dec-94 Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-1

BMO Canadian REIT Index Market Capitalization ($ million)

Apartments Retail Office Industrial Diversified Seniors Housing Hotels Storage


3 REITs at the end of1994:Riocan, CREIT,RealFundTtl Mkt Cap = $185MAvg Mkt Cap = $60M

12 REITs at the end of2000:Riocan, CREIT, H&R,Summit, CAP, CPL,ResREIT, Morguard,Cominar, Royal Host, CHIP,LegacyTtl Mkt Cap = $4.9BnAvg Mkt Cap = $410M

45 REITs at January 2015Ttl Mkt Cap = ~$62.6 Bln

Avg Mkt Cap = ~$1.4 Bln


24/36



Capital Raising 2014 to 2015 YTD Summary

Summary of 2014 to 2015 YTD Debt & Equity Offerings / IPO's

Secured Debentures

Announcement Date REIT Coupon/Spread Details Gross Raise (mil) Total to Public

23-Jan-14 Leisureworld 3.474%/150 bps 7 years $322 $322

Total Secured Raised $322 $322

Unsecured Debentures

Announcement Date REIT Coupon/Spread Details Gross Raise (mil) Total to Public

10-Jan-14 First Capital Realty 4.79%/207 bps 10.6 years $150 $150

13-Jan-14 Cominar REIT 4.941%/275 bps 6.5 years $100 $100

14-Jan-14 Dundee 4.074%/210 bps 6 years $150 $150

16-Jan-14 RioCan REIT 3.62%/160 bps 6.5 years $150 $150

3-Feb-14 Choice Properties 3.498%/160 bps 7 years $250 $250

3-Feb-14 Choice Properties 4.293%/190 bps 10 years $200 $200

6-Feb-14 Calloway REIT 3.749%/187 bps 7 years $150 $150

28-Feb-14 Crombie REIT 3.962%/195 bps 7.3 years $100 $100

4-Mar-14 Cominar REIT 4.941%/260 bps 6.4 years $100 $100

5-Mar-14 First Capital Realty 4.79%/184 bps 10.5 years $75 $75

20-Mar-14 Artis REIT 3.753%/200 bps 5 years $125 $125

1 5-Apr-1 4 C ho ice Pro pe rti es (Seri es 5)2 3.0%/94 bps 2 years $300 $300

1 5-Apr-1 4 C ho ice Pro pe rti es (Seri es 6)2 3.0%/100 bps 3 years $200 $200

7 -May-14 C ho ice Pro pe rti es (Seri es 7)2 3.0%/128 bps 5.5 years $300 $300

7 -May-14 C ho ice Pro pe rti es (Seri es 8)2 3.6%/140 bps 6 years $300 $300

7 -May-14 C ho ice Pro pe rti es (Seri es 9)2 3.6%/155 bps 7.5 years $200 $200

7 -May-14 C ho ice Pro pe rti es (Seri es 10 )2 3.6%/167 bps 8.5 years $300 $300

22-May-14 RioCan REIT 3.746%/167 bps 8 years $150 $150

23-Jun-14 Granite 3.788%/185 bps 7 years $250 $250

8-Jul-14 First Capital Realty 4.323%/194 bps 11 years $200 $200

8-Jul-14 Calloway REIT 3.959%/175 bps 9 years $50 $0

15-Jul-14 Calloway REIT 3.73%/170 bps 8 years $150 $150

6-Aug-14 RioCan REIT 3.746%/171 bps 8 years $100 $100

10-Sep-14 Artis REIT 3.753%/198 bps 4.5 years $75 $75

17-Sep-14 Cominar REIT 3.62%/197 bps 4.5 years $300 $300

17-Sep-14 Cominar REIT 3-mo. CDOR + 108 bps 2 years $250 $250

18-Sep-14 Ventas 3.0%/127 bps 5.0 years $400 $0

18-Sep-14 Ventas 4.125%/240 bps 10.0 years $250 $0

8-Dec-14 Cominar REIT 4.250%/255 bps 7.0 years $200 $200

Total Unsecured Raised $5,525 $4,825

Convertible Debentures1

Announcement Date REIT Coupon Details Gross Raise (mil) Total to Public

29-May-14 True North Apartment 5.75% 5 years $23 $23

3-Sep-14 NorthWest Intl. Healthcare Prop. 7.25% 5 years $35 $35

12-Nov-14 Melcor REIT 5.50% 5 years $35 $35

Total Converts Raised $93 $93

Preferred Equity1

Announcement Date REIT Interest Shares Offered Gross Raise (mil) Total to Public7-Oct-14 Brookfield Office Properties (BPY) 4.75% 12.0 $300 $300

Total Pref Equity Raised $300 $300

Source: Company Press Releases, BMO Capital Markets

Notes:

1. Amounts include o/a options - final amounts could change. Does not include issuances of Class B units

2. Secondary offering

3. BMO is restricted on Summit Industrial REIT and True North Commercial REIT

4. Total proceeds include a $250 million bought deal of trust units and a concurrent $250 million private placement of trust units to Ivanho Cambridge


25/36



Capital Raising 2014 to 2015 YTD Summary (Continued)

Equity Issues1, 3

Announcement Date REIT Offer Price Units (mil) Gross Raise (mil) Total to Public

8-Jan-14 PIRET $4.55 16.4 $75 $75

26-Feb-14 Regal $7.75 3.0 $23 $23

17-Mar-14 WPT Industrial $9.30 2.7 $32 $25

24-Mar-14 Milestone Apartments $10.40 6.6 $69 $69

8-Apr-14 Dream Unlimited $15.70 3.7 $58 $5815-Apr-14 HealthLease $10.00 7.5 $75 $75

16-Apr-14 Melcor REIT $10.65 2.2 $23 $23

22-Apr-14 FAM REIT 3 $8.85 2.7 $24 $18

30-Apr-14 NorthWest Intl. Heathcare Prop. $2.05 11.2 $23 $23

12-May-14 Artis REIT $16.10 7.1 $115 $115

15-May-14 Sum mit Indus trial REIT 3 $5.80 5.0 $29 $29

15-May-14 AHIP $10.35 4.5 $46 $46

20-May-14 Regal Lifestyle $7.65 4.1 $31 $31

21-May-14 Crombie REIT $13.25 7.5 $100 $60

29-May-14 BTB REIT $4.55 5.6 $25 $25

18-Jun-14 PIRET $4.60 38.8 $178 $178

9-Jul-14 Pure Multi-Family REIT $5.06 6.4 $32 $32

16-Jul-14 Retrocom REIT $4.30 12.1 $52 $52

17-Jul-14 Dream Global REIT2 $9.15 8.6 $79 $79

17-Jul-14 Dream Office REIT2 $28.70 4.5 $128 $128

12-Aug-14 Allied Properties $35.30 4.9 $173 $173

18 -Au g-1 4 Tru e N orth C om me rci al REIT 3 $6.55 1.9 $13 $13

26-Aug-14 Cominar REIT $19.00 28.3 $538 $288

3-Sep-14 First Capital Realty $19.06 5.3 $100 $80

17-Sep-14 Slate Retail REIT $11.75 4.3 $50 $50

25-Sep-14 PRO REIT $2.30 13.2 $31 $21

6-Oct-14 Milestone Apartments $11.50 10.0 $115 $115

6-Oct-14 American Hotel Income Properties $10.45 4.8 $50 $50

17-Oct-14 Inovalis REIT $9.30 4.0 $37 $37

27-Oct-14 Firm Capital Property Trust $5.35 1.9 $10 $0

5-Nov-14 NorthWest Intl. Heathcare Prop. $2.15 16.0 $35 $35

6-Nov-14 CHC Realty Capital Corp. $0.11 98.6 $11 $0

6-Nov-14 InnVest REIT $5.25 22.8 $120 $73

10-Nov-14 Killam Properties $10.55 4.4 $46 $46

11-Nov-14 Nobel REIT $0.80 17.5 $14 $12

11-Nov-14 CREIT $49.00 2.9 $144 $144

13-Nov-14 RioCan REIT $26.25 4.8 $126 $126

1 1-D ec-1 4 Tru e N orth Com me rci al REIT 3 $6.15 5.1 $31 $31

15-D ec-14 Sum mit Indus trial REIT3 $5.85 5.9 $35 $35

Total Equity Raised $2,895 $2,492

Total Capital Raised $9,135 $8,031

Source: Company Press Releases, BMO Capital Markets

Notes:

1. Amounts include o/a options - final amounts could change. Does not include issuances of Class B units

2. Secondary offering

3. BMO is restricted on Summit Industrial REIT and True North Commercial REIT

4. Total proceeds include a $250 million bought deal of trust units and a concurrent $250 million private placement of trust units to Ivanho Cambridge


26/36



Canadian Real Estate M&A 20122015 Deals and Relative Performanceof 20122015 IPOs

Equity Enterprise Implied Close price 20 Day VWAP

Value ($mm)Value

($mm)Cap. Rate % C hange % Change St atus

Aug-14 HealthLease Properties Health Care REIT $529 $1,034 12.3x 13.7x ~7% 31.2% 32.0% Completed

Aug-14 Huntingdon Capital Slate Properties $131 $210 na na na 11.8% na Completed

Jun-14 BLF REIT FTQ / 8881723 Canada Inc. $25 $97 na na na 27.1% 33.4% Completed

May-14 Royal Host Inc. Holloway Lodging Corporation $23 $157 7.4x 46.7x ~8% 14.8% 13.6% Completed

Sep-13 Brookfield Offic e Pr oper ties Brookfi eld Property Partners ~ $11 bil lion ~ $25 billion 27.7x 33.9x na 21.3% 20.8% Completed

Mar-13 C2C Industrial Dundee Industrial REIT $84 $226 na na 6.4%-6.7%2

31.1% 28.3% Completed

Mar-13 KEYreit3

Plazacorp $124 $325 17.4x 19.4x 6.8% 35.1% 35.1% Completed

Feb-13 Primaris REIT H&R REIT/KingSett-led Consortium $2,780 $5,000 17.5x 20.1x mid-5% 20.0% 20.4% Completed

Apr-12 TransGlobe REIT3

Starlight / Daniel Drimmer $1,029 $2,059 13.8x 17.6x mid-5% 15.4% 19.3% Completed

Apr-12 GT Canada Medical Prop4

NVPI / NorthWest Healthcare REIT $38 $87 na na 7.0% 47.2% na Completed

Jan-12 Whiterock REIT3 Dundee REIT $600 $1,400 12.3x 14.5x 6.5% 13.6% 20.0% Completed

May-12 Gazit America Gazit-Globe/First Capital Realty $165 $449 na na na 46.0% 49.0% Completed

Nov-11 Canmarc REIT 3 Cominar REIT $900 $1,900 13.8x 16.3x 6.8% 24.2% na Completed

2012-2015 Average 16.8x 27.3x 6.6% 26.1% 27.2%

Historical Average 13.7x 19.8x 7.6% 22.4% 31.3%

1. BMO Capital Markets is restricted on Summit Industrial REIT and True North Commercial REIT2. 6.7% cap rate includes property management fee income3. Based on forward consensus estimates

4. As part of the transaction, NVPI retained the management platform/shell of GT C anada, and sold all the assets to Northwest Healthcare REIT for $87.3M (on a neutral/equivalent basis)Source: Company Reports, BMO Capital Markets

2014

2013

2012

Canadian Real Estate M&A 2012 - 2015 Deals

Date

AnnouncedTarget Acquirer

P/FFO

(FY1)

P/AFFO

(FY1)


27/36



Canadian REIT/REOC Average Daily Trading Volume (Last Week)

0

250,000

500,000

750,000

1,000,000

1,250,000

1,500,000

1,750,000

2,000,000

RoyalHost

Brookfield(C$)

Brookfield(U$)

Huntingdon

BOX(U$)

Lakeview

Holloway

MorguardCorp.

MainstreetEquity

MelcorREIT

BOX(C$)

Agellan

TrueNorth

BrookfieldRes(C$)

WPTIndustrial

FAM

AmicaMatureLifestyles

MorguardREIT

Partners

AmericanHotels

InterRent

MelcorDevelopments

Granite(C$)

KillamProperties

BTB

NorthernProp.

MorguardRes

BrookfieldPropertyPartners

Regal

NorthwestHealtchare

Temple

Lanesborough

CREIT

PlazaRetail

Leisureworld

TriconCapital

Calloway

ChoiceProperties

AverageTradingVolume

AlliedProperties

CAPREIT

FirstCapitalRealty

InnVest

RetroCom

Crombie

DundeeInternational

DundeeIndustrial

Boardwalk

Chartwell

Artis

Dundee

Cominar

Extendicare

BrookfieldRes(U$)

PIRET

Source: Bloomberg, BMO Capital MarketsLast Update: January 2, 2015

BMO Capital Markets is Restricted on Summit Industrial REIT, and True North Commercia

Canadian REIT/REOC Average Daily Trading Volume (Last Six Months)

0

250,000

500,000

750,000

1,000,000

1,250,000

1,500,000

RoyalHost

BOX(U$)

MorguardCorp.

MainstreetEquity

Lakeview

MelcorREIT

Lanesborough

MelcorDevelopments

BrookfieldRes(C$)

Holloway

Huntingdon

BOX(C$)

Agellan

FAM

InterRent

WPTIndustrial

TrueNorth

AmicaMatureLifestyles

MorguardRes

MorguardREIT

Partners

AmericanHotels

Regal

Granite(C$)

NorthernProp.

BTB

NorthwestHealtchare

Leisureworld

PlazaRetail

ChoiceProperties

Boardwalk

Temple

CREIT

InnVest

KillamProperties

DundeeIndustrial

AverageTradingVolume

AlliedProperties

BrookfieldRes(U$)

Calloway

RetroCom

FirstCapitalRealty

CAPREIT

Crombie

BrookfieldPropertyPartners

TriconCapital

Artis

Chartwell

Dundee

Extendicare

DundeeInternational

Cominar

H&R

RioCan

Source: Bloomberg, BMO Capital MarketsLast Update: January 2, 2015

BMO Capital Markets is Restricted on Summit Industrial REIT, and True North Commercia


28/36



Net Insider Activity

0

50

100

150

200

250

300

-$6,000,000

-$4,000,000

-$2,000,000

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

$14,000,000

$16,000,000

Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14

(IndexPrice)

($value)

Net Insider Activity ($Value) - 12 month Rolling Average* vs. S&P/TSX Capped REIT Index

Source: SEDI, Ink Research, BMO Capital MarketsLast Updated: January 2, 2015

S&P/TSX Capped REIT Index

Net Insider Activity ($value)12 month Rolling Average

*normalized for outlier transaction activity including:BAM purchase of 47.5 million shares of BPO in Aug/2010 and KingSett sale of 8.2 million units of PMZ.UN in Sep/2010,Morguard Corp. buy of 870K MRG units in Mar/2013 and Alony-Hetz sale of $3.5 million units of FCR in May/2013 in order toderive a stable trend.

(5,500,000) (4,500,000) (3,50 0,000) (2,50 0,000) (1,500,000) (500,000) 500,000 1,500,000 2,500,000 3,500,000 4,500,000 5,500,000

CWTRMM

INNMRGRYLSMU

TNTPH

ACC

MRTAARRLCCRTDIR

ACRREFHLPBTB

DIIIP

CSHLW

MSTNPRHOTAXREI

BPOCUFINO

CAREXEBOX

DCRR

HRBEI

KMPAPPAR

NWHPLZFCR

Units/Shares

2014 to 2015 YTD Aggregate "Net" Insider Buying and Selling of Equity

Source: SEDI, INK Research, BMO Capital MarketsLast Updated: January 2, 2015

*INN.UN - NOT SHOWN TO SCALEKingsett Capital (Jon Love) acquired ~1.7 million units between theprices of $5.24 and $5.29 in April 2014.

Note: BMO Capital Markets is Restricted on Summit Industrial REIT and True North Commercial REIT

Methodology: Insider buying/selling and NCIB activity are reported for Canadian REITs in our coverage/tracking universe. Oreported activity excludes share/unit purchases under employee ownership plans. Insider selling activity through option exercisealso excluded from the chart above, as these sale transactions are sometimes used as a funding source for the related optioexercise.


29/36


30/36

Sector Comment

Financial Position: Mortgage Maturity Schedule

4.2%

4.8%

3.7%

4.2%

3.4%

4.2%

5.3%

3.7%

4.9%

3.6%

4.8%

4.5%

4.8%

4.4%

3.9%

5.1%

4.9%

3.3%

3.9% 3.9% 3.8%

4.2%

3.7%

4.6%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

Agellan

Allied

Amica

Artis

Boardwalk

BrookfieldCda.

Calloway

CAPREIT

Chartwell

ChoiceProperties

Cominar

CREIT

Crombie

CTREIT

DreamIndustrial

FirstCapital

H&R

InterRent

KillamProperties

Leisureworld

Milestone

MorguardREIT

NorthernProp.

NorthWestHealthcare

% of Mortgages Expiring 2014 % of Mortgages Expir ing 2015 % of Mortgages Expiring 2016 Weighted Avg. Interest Rate (RH)

Note: BMO Capital Markets is



31/36

Sector Comment


Financial Position: Debt to Total Assets

35%

36%

37%

43%

43%

44%

45%

45%

47%47%

48%

49%

50%

50%

50%

51%

52%

52%

52%

52%

52%

53%

53%

54%

55%56%

56%

58%

59%

60

25% 35% 45% 55%

Allied Properties

Boardwalk

CREIT

Brookfield Cda. REIT

Calloway

RioCan

Morguard REIT

Choice Properties

Northern Prop.CAP REIT

First Capital Realty

CT REIT

H&R

Artis

InterRent

WPT Industrial

NorthWest Healthcare Prop.

Milestone

Summit

PIRET

Agellan

Crombie

Dream Industrial

Killam Properties

Chartwell**Cominar

Retrocom

Leisureworld**

Slate Retail REIT

Regal**

Amica Mature Lifestyles**

Source: BMO Capital Markets, Company reports* Financial position data as of last reported quarter adjusted for post-quarter announcements** Debt to GBV (at historical cost) for Amica, Leisureworld, Regal, Chartwell.

Note: BMO Capital Markets is


32/36


33/36

Sector Comment

REIT & REOC Preferred Shares

(C$, unless otherwise indicated) 2-Jan-15 Percent Size Coupon Issue Call Conv.

Price Change (MM) Rate Yield Date Date Date Detailed P

Select REIT & REOC Preferred Shares

Artis REIT - A $24.60 -- $86.3 5.25% 5.3% Aug-12 Sep-17 N/A 5.25% Cum

Artis REIT - C $23.00 0.2% $75.0 5.25% 5.8% Sep-12 Mar-18 N/A 5.25% Cum

Artis REIT - E $19.30 (1.0%) $100.0 4.75% 6.0% Mar-13 Mar-18 N/A 5.25% Cum

Brookfield Office Properties - F $25.40 -- $200.0 6.00% 5.8% Sep-02 Sep-09 Mar-13 6.00% Cum

Brookfield Office Properties - H $25.28 -- $200.0 5.75% 5.7% Oct-03 Dec-11 Dec-15 5.75% Cum

Brookfield Office Properties - J $25.08 (0.1%) $200.0 5.00% 5.0% Apr-04 Jun-10 Dec-14 5.00% CumBrookfield Office Properties - K $25.52 (1.8%) $150.0 5.20% 5.1% Oct-04 Dec-12 Dec-16 5.20% Cum

Brookfield Office Properties - N $25.53 (0.2%) $275.0 6.15% 6.0% Jan-10 Jun-16 N/A 6.15% Cum

Brookfield Office Properties - P $25.60 (0.4%) $300.0 5.15% 5.0% Oct-10 Mar-17 N/A 5.15% Cum

Brookfield Office Properties - R $25.47 -- $250.0 5.10% 5.0% Sep-11 Sep-16 N/A 5.10% Cum

Brookfield Office Properties - T $25.57 (1.0%) $250.0 4.60% 4.5% Sep-12 Dec-18 N/A 6.00% Cum

RioCan - A $25.32 -- $125.0 5.25% 5.2% Jan-11 Mar-16 N/A 5.25% Cum

RioCan - C $25.97 0.3% $149.5 4.70% 4.5% Nov-11 Jun-17 N/A 4.70% Cum

Source: BMO Capital Markets Note: BMO Capital Markets is



34/36

Sector Comment

2013 Return of Capital

0% 20% 40% 60%

InterRent

Milestone

BTB

Partners

Retrocom

True North

Northwest HealthCare Properties

Crombie

Artis

CAP

PIRET

Morguard NA Residential

Chartwell

WPT Industrial

Summit II

Cominar

Dundee Industrial

HealthLease Properties

Allied Properties

Calloway

Dundee

Dundee International

Brookfield Canada

H&R

Morguard

Agellan

CT Reit

BoardwalkNorthern Property

Choice Properties

Pure Multi-family

InnVest

Riocan

CREIT

Source: Company Website & Reports, BMO Capital Markets Note: BMO Capital Markets is R



35/36



IMPORTANT DISCLOSURES

Analyst's Certification

I, Heather Kirk, CFA, hereby certify that the views expressed in this report accurately reflect my personal views about the subject securities or issuers.also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in thireport.

I, Troy MacLean, CFA, hereby certify that the views expressed in this report accurately reflect my personal views about the subject securities or issuerI also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in threport.

Analysts who prepared this report are compensated based upon (among other factors) the overall profitability of BMO Capital Markets and theaffiliates, which includes the overall profitability of investment banking services. Compensation for research is based on effectiveness in generating neideas and in communication of ideas to clients, performance of recommendations, accuracy of earnings estimates, and service to clients.

Analysts employed by BMO Nesbitt Burns Inc. and/or BMO Capital Markets Limited are not registered as research analysts with FINRA (exceptionAlex Arfaei). These analysts may not be associated persons of BMO Capital Markets Corp. and therefore may not be subject to the NASD Rule 2711 an

NYSE Rule 472 restrictions on communications with a subject company, public appearances and trading securities held by a research analyst account.

Company Specific Disclosures

For Important Disclosures on the stocks discussed in this report, please go tohttp://researchglobal.bmocapitalmarkets.com/Public/Company_Disclosure_Public.aspx

Distribution of Ratings (September 30, 2014)

RatingCategory BMO Rating

BMOCM USUniverse*

BMOCM USIB Clients**

BMOCM USIB Clients***

BMOCMUniverse****

BMOCMIB Clients*****

StarmineUniverse

Buy Outperform 44.3% 18.0% 60.3% 43.9% 56.5% 56.0%

Hold Market Perform 52.5% 9.7% 38.5% 51.6% 42.1% 39.1%

Sell Underperform 3.2% 5.3% 1.3% 4.5% 1.4% 4.9%

* Reflects rating distribution of all companies covered by BMO Capital Markets Corp. equity research analysts.** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking services

percentage within ratings category.*** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking servic

as percentage of Investment Banking clients.**** Reflects rating distribution of all companies covered by BMO Capital Markets equity research analysts.***** Reflects rating distribution of all companies from which BMO Capital Markets has received compensation for Investment Banking services

percentage of Investment Banking clients.

Rating and Sector Key (as of April 5, 2013):

We use the following ratings system definitions:OP = Outperform - Forecast to outperform the analysts coverage universe on a total return basisMkt = Market Perform - Forecast to perform roughly in line with the analysts coverage universe on a total return basisUnd = Underperform - Forecast to underperform the analysts coverage universe on a total return basis on a total return basis(S) = speculative investment;

NR = No rating at this time;R = Restricted Dissemination of research is currently restricted.

BMO Capital Markets' seven Top 15 lists guide investors to our best ideas according to different objectives (CDN Large Cap, CDN Small Cap, US LargCap, US Small cap, Income, CDN Quant, and US Quant have replaced the Top Pick rating).

Prior BMO Capital Markets Ratings System (January 4, 2010April 5, 2013):

http://researchglobal.bmocapitalmarkets.com/documents/2013/prior_rating_system.pdf

Other Important DisclosuresFor Important Disclosures on the stocks discussed in this report, please go tohttp://researchglobal.bmocapitalmarkets.com/Public/Company_Disclosure_Public.aspx or write to Editorial Department, BMO Capital Markets, 3 TimeSquare, New York, NY 10036 or Editorial Department, BMO Capital Markets, 1 First Canadian Place, Toronto, Ontario, M5X 1H3.

Dissemination of Research

BMO Capital Markets Equity Research is available via our website https://research-ca.bmocapitalmarkets.com/Public/Secure/Login.aspxReturnUrl=/Member/Home/ResearchHome.aspx. Institutional clients may also receive our research via Thomson Reuters, Bloomberg, FactSet, anCapital IQ. Research reports and other commentary are required to be simultaneously disseminated internally and externally to our clients.
http://researchglobal.bmocapitalmarkets.com/Public/Company_Disclosure_Public.aspxhttp://researchglobal.bmocapitalmarkets.com/documents/2013/prior_rating_system.pdfhttp://researchglobal.bmocapitalmarkets.com/Public/Company_Disclosure_Public.aspxhttps://research-ca.bmocapitalmarkets.com/Public/Secure/Login.aspx?ReturnUrl=/Member/Home/ResearchHome.aspxhttps://research-ca.bmocapitalmarkets.com/Public/Secure/Login.aspx?ReturnUrl=/Member/Home/ResearchHome.aspxhttps://research-ca.bmocapitalmarkets.com/Public/Secure/Login.aspx?ReturnUrl=/Member/Home/ResearchHome.aspxhttps://research-ca.bmocapitalmarkets.com/Public/Secure/Login.aspx?ReturnUrl=/Member/Home/ResearchHome.aspxhttp://researchglobal.bmocapitalmarkets.com/Public/Company_Disclosure_Public.aspxhttp://researchglobal.bmocapitalmarkets.com/documents/2013/prior_rating_system.pdfhttp://researchglobal.bmocapitalmarkets.com/Public/Company_Disclosure_Public.aspx


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General Disclaimer

BMO Capital Markets is a trade name used by the BMO Investment Banking Group, which includes the wholesale arm of Bank of Montreal and subsidiaries BMO Nesbitt Burns Inc., BMO Capital Markets Limited in the U.K. and BMO Capital Markets Corp. in the U.S. BMO Nesbitt Burns InBMO Capital Markets Limited and BMO Capital Markets Corp are affiliates. Bank of Montreal or its subsidiaries (BMO Financial Group) has lendinarrangements with, or provide other remunerated services to, many issuers covered by BMO Capital Markets. The opinions, estimates and projectiocontained in this report are those of BMO Capital Markets as of the date of this report and are subject to change without notice. BMO Capital Markeendeavours to ensure that the contents have been compiled or derived from sources that we believe are reliable and contain information and opinions thare accurate and complete. However, BMO Capital Markets makes no representation or warranty, express or implied, in respect thereof, takes n

responsibility for any errors and omissions contained herein and accepts no liability whatsoever for any loss arising from any use of, or reliance on, threport or its contents. Information may be available to BMO Capital Markets or its affiliates that is not reflected in this report. The information in threport is not intended to be used as the primary basis of investment decisions, and because of individual client objectives, should not be construed aadvice designed to meet the particular investment needs of any investor. This material is for information purposes only and is not an offer to sell or thsolicitation of an offer to buy any security. BMO Capital Markets or its affiliates will buy from or sell to customers the securities of issuers mentioned ithis report on a principal basis. BMO Capital Markets or its affiliates, officers, directors or employees have a long or short position in many of thsecurities discussed herein, related securities or in options, futures or other derivative instruments based thereon. The reader should assume that BMCapital Markets or its affiliates may have a conflict of interest and should not rely solely on this report in evaluating whether or not to buy or sesecurities of issuers discussed herein.

Additional Matters

To Canadian Residents: BMO Nesbitt Burns Inc. furnishes this report to Canadian residents and accepts responsibility for the contents herein subject tthe terms set out above. Any Canadian person wishing to effect transactions in any of the securities included in this report should do so through BMO

Nesbitt Burns Inc.

The following applies if this research was prepared in whole or in part by Andrew Breichmanas, Iain Reid, Tony Robson, David Round, Edward Steror Brendan Warn: This research is not prepared subject to Canadian disclosure requirements. This research is prepared by BMO Capital MarkeLimited and subject to the regulations of the Financial Conduct Authority (FCA) in the United Kingdom. FCA regulations require that a firm providinresearch disclose its ownership interest in the issuer that is the subject of the research if it and its affiliates own 5% or more of the equity of the issueCanadian regulations require that a firm providing research disclose its ownership interest in the issuer that is the subject of the research if it and iaffiliates own 1% or more of the equity of the issuer that is the subject of the research. Therefore BMO Capital Markets Limited will disclose its and iaffiliates ownership interest in the subject issuer only if such ownership exceeds 5% of the equity of the issuer.

To U.S. Residents: BMO Capital Markets Corp. furnishes this report to U.S. residents and accepts responsibility for the contents herein, except to thextent that it refers to securities of Bank of Montreal. Any U.S. person wishing to effect transactions in any security discussed herein should do through BMO Capital Markets Corp.

To U.K. Residents: In the UK this document is published by BMO Capital Markets Limited which is authorised and regulated by the Financial ConducAuthority. The contents hereof are intended solely for the use of, and may only be issued or passed on to, (I) persons who have professional experienin matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (thOrder) or (II) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together referred to as relevant personsThe contents hereof are not intended for the use of and may not be issued or passed on to retail clients.

Unauthorized reproduction, distribution, transmission or publication without the prior written consent of BMO Capital Markets is strictly prohibited.

Click herefor data vendor disclosures when referenced within a BMO Capital Markets research document.

ADDITIONAL INFORMATION IS AVAILABLE UPON REQUESTBMO Financial Group (NYSE, TSX: BMO) is an integrated financial services provider offering a range of retail banking, wealth management, and investment acorporate banking products. BMO serves Canadian retail clients through BMO Bank of Montreal and BMO Nesbitt Burns. In the United States, personal ancommercial banking clients are served by BMO Harris Bank N.A., (Member FDIC). Investment and corporate banking services are provided in Canada and the Uthrough BMO Capital Markets.

BMO Capital Markets is a trade name used by BMO Financial Group for the wholesale banking businesses of Bank of Montreal, BMO Harris Bank N.(Member FDIC), BMO Ireland Plc, and Bank of Montreal (China) Co. Ltd. and the institutional broker dealer businesses of BMO Capital Markets Cor(Member SIPC), and BMO Capital Markets GKST Inc. (Member SIPC) in the U.S., BMO Nesbitt Burns Inc. (Member Canadian Investor Protection Fund)Canada, Europe and Asia, BMO Capital Markets Limited in Europe and Australia and BMO Advisors Private Limited in India.

Nesbitt Burns is a registered trademark of BMO Nesbitt Burns Corporation Limited, used under license. BMO Capital Markets is a trademark of Bank of Montreused under license. "BMO (M-Bar roundel symbol)" is a registered trademark of Bank of Montreal, used under license.

Registered trademark of Bank of Montreal in the United States, Canada and elsewhere.TM Trademark Bank of Montreal

COPYRIGHT 2015 BMO CAPITAL MARKETS CORP
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