“We were encouraged by a noticeable increase in private market activity in the fourth quarter, as we closed on several sizable asset sales, including One London Wall Place and our self-storage business, executed at premiums to both our current and pre-pandemic carrying values,” said Brian Kingston, Chief Executive Officer. “Our office operations have continued to perform well, and we were pleased by the resilience of our retail portfolio leading up to and through the holiday shopping season.”
Financial Results
Company FFO (CFFO) was $167 million for the quarter ended December 31, 2020, compared to $379 million in the prior-year period. Company FFO was $815 million for the year ended December 31, 2020, compared to $1.35 billion in 2019. CFFO was impacted over the course of the year by the effects of the global economic slowdown during much of 2020.
Net income for the quarter ended December 31, 2020 was a loss of $38million or $0.40 per LP unit compared to a gain of $1.55 billion or $1.00 per LP unit for the same period in 2019. The prior year period benefited from higher valuation gains in our Canada and UK office portfolios, as well as strong performance in several of our LP investments. Net income for the year ended December 31, 2020 was a loss of $2.06 billion or $2.39 per LP unit compared to a gain of $3.16 billion or $1.89 per LP unit in 2019. The decrease this year is primarily attributable to unrealized reductions of values of certain assets within the portfolio.
| Three months ended Dec. 31, | Twelve months ended Dec. 31, | |||||||||||||
| (US$ Millions, except per unit amounts) | 2020 | 2019 | 2020 | 2019 | ||||||||||
| Net (loss) income(1) | $ | (38 | ) | $ | 1,551 | $ | (2,058 | ) | $ | 3,157 | ||||
| Company FFO and realized gains(2) | $ | 287 | $ | 459 | $ | 952 | $ | 1,512 | ||||||
| Company FFO(2) | $ | 167 | $ | 379 | $ | 815 | $ | 1,345 | ||||||
| Net (loss) income per LP unit(3)(4) | $ | (0.40 | ) | $ | 1.00 | $ | (2.39 | ) | $ | 1.89 | ||||
| Company FFO and realized gains per unit(4)(5) | $ | 0.30 | $ | 0.48 | $ | 0.97 | $ | 1.57 | ||||||
| (1) | Consolidated basis – includes amounts attributable to non-controlling interests. |
| (2) | See “Basis of Presentation” and “Reconciliation of Non-IFRS Measures” in this press release for the definition and components. |
| (3) | Represents basic net income attributable to holders of LP units. IFRS requires the inclusion of preferred shares that are mandatorily convertible into LP units at a price of $25.70 without an add-back to earnings of the associated carry on the preferred shares. |
| (4) | Net income attributable to holders of LP units and Company FFO and realized gains per unit are reduced by preferred dividends of $11 million (2019 – $7 million) and $42 million (2019 – $15 million) for three and twelve months ended December 31, 2020, respectively, in determining per unit amounts. |
| (5) | Company FFO and realized gains per unit are calculated based on 927.3 million (2019 – 947.2 million) and 934.9 million (2019 – 955.0 million) units outstanding for the three and twelve months ended December 31, 2020, respectively. |
Operating Highlights
Our Core Office business generated CFFO of $138 million for the quarter ended December 31, 2020 compared to $185 million in the same period in 2019 and $540 million for the year ended December 31, 2020 compared to $662 million on a comparable basis in 2019. Results this quarter were mainly impacted by reduced contributions from our parking and retail operations. Results in the prior-year period included incremental transaction income of $25 million.
Core Office leasing activity in the fourth quarter totaled 870,000 square feet, which were completed at rents 16% higher on average than expiring leases in the period. Occupancy in the portfolio decreased 90 basis points to 89.8%, with a remaining weighted average lease term of 8.2 years.
Our Core Retail business generated CFFO of $118 million for the quarter ended December 31, 2020 compared to $217 million in the comparable period in 2019 and $550 million for the year ended December 31, 2020 compared to $772 million in 2019. The quarterly and yearly declines are primarily attributable to the impact of the global economic slowdown during much of 2020.
Our Core Retail operations leased approximately 6.3 million square feet over the past 12 months with comparable rent spreads of 1%. Our properties were 92.5% leased at December 31, 2020, a decrease of 90 basis points from the prior period. On a year-over-year basis, in-place rents were up 0.7%1.
Our LP Investments generated CFFO and realized gains of $138 million for the quarter ended December 31, 2020, compared to earnings of $150 million in the comparable period in 2019 and $232 million for the year ended December 31, 2020 compared to $476 million in 2019. Results this quarter were negatively impacted by a $51 million decrease in earnings from our Hospitality investments due to pandemic-related hotel closures and travel restrictions, offset in part by a $40 million increase in realized gains related to the sales of mature assets.
______________________________
1 In-place rents reflect retail tenants <10K square feet.
| Three months ended Dec. 31, | Twelve months ended Dec. 31, | |||||||||||
| (US$ Millions) | 2020 | 2019 | 2020 | 2019 | ||||||||
| Company FFO and realized gains: | ||||||||||||
| Core Office | $ | 138 | $ | 185 | $ | 540 | $ | 662 | ||||
| Core Retail | $ | 118 | $ | 217 | $ | 550 | $ | 772 | ||||
| LP Investments | $ | 138 | $ | 150 | $ | 232 | $ | 476 | ||||
| Corporate | $ | (107 | ) | $ | (93 | ) | $ | (370 | ) | $ | (398 | ) |
| Company FFO and realized gains(1) | $ | 287 | $ | 459 | $ | 952 | $ | 1,512 | ||||
(1) See “Basis of Presentation” and “Reconciliation of Non-IFRS Measures” below in this press release for the definitions and components.
Dispositions
In the fourth quarter, we completed $1.37 billion of gross asset dispositions at our share, at prices that were 10% higher on average than our IFRS carrying values. These sales generated approximately $530 million in net proceeds to BPY.
Dispositions completed in the fourth quarter include:
- Completed the sale of One London Wall Place in London for $614 million, generating net proceeds of $262 million to BPY.
- Completed the sale of Simply Self Storage for $1.22 billion, generating net proceeds of $109 million to BPY.
- Sold two Brazil office assets, EZ Tower B and WT Morumbi, for an aggregate of $379 million, generating net proceeds of $50 million to BPY.
- Sold assets in our triple net lease automotive dealership portfolio (CARS) for an aggregate of $786 million, generating net proceeds of $52 million to BPY.
- Entered into contract to sell our Northeast U.S. life sciences office portfolio at a gross sales price of $3.5 billion, generating approximately $100 million in net proceeds to BPY.
Balance Sheet Update
To increase liquidity and extend the maturity of our debt, during the fourth quarter we executed the following financing transactions:
- Refinanced the Grace Building in New York for $1.25 billion for a ten-year term at a fixed-rate, weighted average coupon of 2.69%.
- Refinanced One New York Plaza in New York for $835 million with a two-year (five years fully extended without credit tests) term at a floating interest rate of LIBOR +1.52%.
- Refinanced or extended mortgage maturities for an average of three years on five Core Retail assets totaling approximately $0.9 billion at a blended interest rate of 4.12%.
Ended the quarter with $5.5 billion of group-wide liquidity, including $1.7 billion of cash on hand, $2.4 billion of corporate and subsidiary credit facilities and $1.4 billion of undrawn construction facilities.
Privatization Proposal from Brookfield Asset Management
On January 4, 2021, Brookfield Asset Management announced a proposal to acquire 100% of the limited partnership units of BPY that it does not already own (approximately 357.6 million Units) for a price of $16.50 per Unit, or $5.9 billion in total value. A Special Committee of the Independent Directors of BPY’s Board has engaged external legal and financial advisors and collectively they are currently considering the proposal. Neither BPY unitholders nor BPYU class A stockholders need to take any action related to the proposal at this time.
Unit Repurchases
Utilizing our in-place normal course issuer bid (“NCIB”), we purchased 20,222,827 of BPY units in the fourth quarter of 2020 at an average price of $13.49 per unit. The NCIB was funded by drawing on the equity commitment with Brookfield Asset Management and certain of its institutional clients.
Distribution Declaration
The Board of Directors has declared a quarterly distribution on the partnership’s LP units of $0.3325 per unit payable on March 31, 2021 to unitholders of record at the close of business on February 26, 2021.
The quarterly distributions on the LP units are declared in U.S. dollars. Registered unitholders residing in the United States shall receive quarterly cash distributions in U.S. dollars and registered unitholders not residing in the United States shall receive quarterly cash distributions in the Canadian dollar equivalent, based on the Bank of Canada exchange rate on the record date. Registered unitholders residing in the United States have the option, through Brookfield Property Partners’ transfer agent, AST Trust Company (Canada) (“AST”), to elect to receive quarterly cash distributions in the Canadian dollar equivalent and registered unitholders not residing in the United States have the option through AST to elect to receive quarterly cash distributions in U.S. dollars. Beneficial unitholders (i.e., those holding their units in street name with their brokerage) should contact the broker with whom their units are held to discuss their options regarding distribution currency.
The Board of Directors has also declared quarterly distributions on the partnership’s Class A Series 1, Series 2 and Series 3 preferred units of $0.40625 per unit, $0.39844 per unit and $0.35938, respectively, payable on March 31, 2021 to holders of record at the close of business on March 1, 2021.
Additional Information
Further details regarding the operations of the Partnership are set forth in regulatory filings. A copy of the filings may be obtained through the website of the SEC at www.sec.gov and on the Partnership’s SEDAR profile at www.sedar.com. The Partnership’s quarterly letter to unitholders and supplemental information package can be accessed before the market open on February 2, 2021 at bpy.brookfield.com. This additional information should be read in conjunction with this press release.
Basis of Presentation
This press release and accompanying financial information make reference to net operating income (“NOI”), same-property NOI, funds from operations (“FFO”), Company FFO and realized gains (“Company FFO and realized gains”) and net income attributable to unitholders.
Company FFO and realized gains, and net income attributable to unitholders are also presented on a per unit basis. NOI, same-property NOI, FFO, Company FFO and realized gains, and net income attributable to unitholders do not have any standardized meaning prescribed by International Financial Reporting Standards (“IFRS”) and therefore may not be comparable to similar measures presented by other companies. The Partnership uses NOI, same-property NOI, FFO, Company FFO and realized gains, and net income attributable to unitholders to assess its operating results. These measures should not be used as alternatives to Net Income and other operating measures determined in accordance with IFRS, but rather to provide supplemental insights into performance. Further, these measures do not represent liquidity measures or cash flow from operations and are not intended to be representative of the funds available for distribution to unitholders either in aggregate or on a per unit basis, where presented.
NOI is defined as revenues from commercial and hospitality operations of consolidated properties less direct commercial property and hospitality expenses. As NOI includes the revenues and expenses directly associated with owning and operating commercial property and hospitality assets, it provides a measure to evaluate the performance of the property operations.
Same-property NOI is a subset of NOI, which excludes NOI that is earned from assets acquired, disposed of or developed during the periods presented, or not of a recurring nature, and from opportunistic assets. Same-property NOI allows the Partnership to segregate the performance of leasing and operating initiatives on the portfolio from the impact to performance from investing activities and “one-time items,” which for the historical periods presented consist primarily of lease termination income.
FFO is defined as income, including equity accounted income, before realized gains (losses) from the sale of investment property (except gains (losses) related to properties developed for sale), fair value gains (losses) (including equity accounted fair value gains (losses)), depreciation and amortization of real estate assets, income tax expense (benefit), and less non-controlling interests of others in operating subsidiaries and properties. FFO is a widely recognized measure that is frequently used by securities analysts, investors and other interested parties in the evaluation of real estate entities, particularly those that own and operate income producing properties. The Partnership’s definition of FFO includes all of the adjustments that are outlined in the National Association of Real Estate Investment Trusts (“NAREIT”) definition of FFO. In addition to the adjustments prescribed by NAREIT, the Partnership also makes adjustments to exclude any unrealized fair value gains (or losses) that arise as a result of reporting under IFRS, and income taxes that arise as certain of its subsidiaries are structured as corporations as opposed to real estate investment trusts (“REITs”). These additional adjustments result in an FFO measure that is similar to that which would result if the Partnership was organized as a REIT that determined net income in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”), which is the type of organization on which the NAREIT definition is premised. The Partnership’s FFO measure will differ from other organizations applying the NAREIT definition to the extent of certain differences between the IFRS and U.S. GAAP reporting frameworks, principally related to the recognition of lease termination income. FFO provides a performance measure that, when compared year-over-year, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and interest costs.
Company FFO and realized gains is defined as FFO before the impact of depreciation and amortization of non-real estate assets, transaction costs, gains (losses) associated with non-investment properties, imputed interest on equity accounted investments, realized gains in the partnership’s LP Investment segment and the partnership’s share of BSREP III Company FFO and realized gains. Realized LP Investment gains represent income earned on investing activity when fund investments are realized, inclusive of associated change in carried interest to be due at a future date to the general partner of the relevant Brookfield Asset Management-sponsored funds. The partnership accounts for the investment in BSREP III as a financial asset and income (loss) of the fund is not presented in the partnership’s results. Distributions from BSREP III, recorded as dividend income under IFRS, are removed from investment and other income for Company FFO and realized gains presentation.
Net income attributable to unitholders is defined as net income attributable to holders of general partnership units and limited partnership units of the Partnership, redeemable/exchangeable and special limited partnership units of Brookfield Property L.P., limited partnership units of Brookfield Office Properties Exchange LP and Class A shares of Brookfield Property REIT Inc. Net income attributable to unitholders is used by the Partnership to evaluate the performance of the Partnership as a whole as each of the unitholders participates in the economics of the Partnership equally. In calculating net income attributable to unitholders per unit, the Partnership excludes the impact of mandatorily convertible preferred units in determining the average number of units outstanding as the holders of mandatorily convertible preferred units do not participate in current earnings. The Partnership reconciles this measure to basic net income attributable to unitholders per unit determined in accordance with IFRS which includes the effect of mandatorily convertible preferred units in the basic average number of units outstanding.
About Brookfield Property Partners
Brookfield Property Partners, through Brookfield Property Partners L.P. and its subsidiary Brookfield Property REIT Inc., is one of the world’s premier real estate companies, with approximately $88 billion in total assets. We own and operate iconic properties in the world’s major markets, and our global portfolio includes office, retail, multifamily, logistics, hospitality, self-storage, triple net lease, manufactured housing and student housing.
Brookfield Property Partners is the flagship listed real estate company of Brookfield Asset Management Inc., a leading global alternative asset manager with approximately $600 billion in assets under management. More information is available at www.brookfield.com.
Brookfield Property Partners L.P. is listed on the Nasdaq Stock Market and the Toronto Stock Exchange. Brookfield Property REIT Inc. is listed on the Nasdaq Stock Market. Further information is available at bpy.brookfield.com.
Certain investor relations content is also available on our investor relations app, which offers access to SEC filings, press releases, presentations and more. Click here to download on the iPhone or iPad, or here for Android mobile devices.
Brookfield Contacts:
| Matt Cherry | Kerrie McHugh |
| Senior Vice President, Investor Relations | Senior Vice President, Communications and Branding |
| Tel: (212) 417-7488 | Tel: (212) 618-3469 |
| Email:matthew.cherry@brookfield.com | Email:kerrie.mchugh@brookfield.com |
Conference Call and Quarterly Earnings Details
Investors, analysts and other interested parties can access BPY’s fourth quarter and year end 2020 results as well as the letter to unitholders and supplemental information on BPY’s website at bpy.brookfield.com.
The conference call can be accessed via webcast on February 2, 2021 at 11:00 a.m. Eastern Time at bpy.brookfield.com or via teleconference by dialing +1 (844) 358-9182 toll-free in the U.S. and Canada or +1 (478) 219-0399 for overseas calls, conference ID: 2377075 , five minutes prior to the scheduled start of the call. A recording of the teleconference can be accessed by dialing +1 (855) 859-2056 toll-free in the U.S. and Canada or +1 (404) 537-3406 for overseas calls, conference ID: 2377075.
Forward-Looking Statements
This communication contains “forward-looking information” within the meaning of applicable securities laws and regulations. Forward-looking statements include statements that are predictive in nature or depend upon or refer to future events or conditions, include statements regarding our operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts,” “likely,” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.”
Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause our actual results, performance or achievements to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.
Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: risks incidental to the ownership and operation of real estate properties including local real estate conditions; the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business, including as a result of the recent global economic shutdown; the ability to enter into new leases or renew leases on favorable terms; business competition; dependence on tenants’ financial condition; the use of debt to finance our business; the behavior of financial markets, including fluctuations in interest and foreign exchange rates; uncertainties of real estate development or redevelopment; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; risks relating to our insurance coverage; the possible impact of international conflicts and other developments including terrorist acts; potential environmental liabilities; changes in tax laws and other tax related risks; dependence on management personnel; illiquidity of investments; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits therefrom; operational and reputational risks; catastrophic events, such as earthquakes, hurricanes or pandemics/epidemics; risks related to the proposed acquisition by Brookfield Asset Management of all of our outstanding LP units that it does not already own including whether it will be approved by unitholders and ultimately consummated. and other risks and factors detailed from time to time in our documents filed with the securities regulators in Canada and the United States. In addition, our future results may be impacted by risks associated with the global economic shutdown caused by a novel strain of coronavirus, COVID-19, and the related global reduction in commerce and travel and substantial volatility in stock markets worldwide, which may result in a decrease of cash flows and impairment losses and/or revaluations on our investments and real estate properties, and we may be unable to achieve our expected returns.
We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements or information, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.
CONSOLIDATED BALANCE SHEETS
| Dec. 31, | Dec. 31, | |||||
| (US$ Millions) | 2020 | 2019 | ||||
| Assets | ||||||
| Investment properties | $ | 72,610 | $ | 75,511 | ||
| Equity accounted investments in properties | 19,719 | 20,764 | ||||
| Property, plant and equipment | 5,235 | 7,278 | ||||
| Financial assets | 1,719 | 1,250 | ||||
| Accounts receivable and other | 5,607 | 5,015 | ||||
| Cash and cash equivalents | 2,473 | 1,438 | ||||
| Assets held for sale | 588 | 387 | ||||
| Total Assets | $ | 107,951 | $ | 111,643 | ||
| Liabilities | ||||||
| Corporate borrowings | $ | 3,232 | $ | 1,902 | ||
| Asset-level debt obligations | 44,515 | 47,466 | ||||
| Subsidiary borrowings, non-recourse to BPY | 6,590 | 6,022 | ||||
| Capital securities | 3,033 | 3,075 | ||||
| Deferred tax liability | 2,858 | 2,515 | ||||
| Accounts payable and other liabilities | 5,804 | 5,588 | ||||
| Liabilities associated with assets held for sale | 396 | 140 | ||||
| Equity | ||||||
| Preferred equity | 699 | 420 | ||||
| General partner | 4 | 4 | ||||
| Limited partners | 11,709 | 13,274 | ||||
| Non-controlling interests attributable to: | ||||||
| Limited partner units of the operating partnership held by Brookfield Asset Management Inc. | 12,249 | 13,200 | ||||
| Limited partner units of Brookfield Office Properties Exchange LP | 73 | 87 | ||||
| FV LTIP units of the operating partnership | 52 | 35 | ||||
| Class A shares of Brookfield Property REIT Inc. | 1,050 | 1,930 | ||||
| Interests of others in operating subsidiaries and properties | 15,687 | 15,985 | ||||
| Total Equity | 41,523 | 44,935 | ||||
| Total Liabilities and Equity | $ | 107,951 | $ | 111,643 | ||
CONSOLIDATED STATEMENT OF OPERATIONS
| Three Months Ended | Twelve Months Ended | |||||||||||
| Dec. 31, | Dec. 31, | |||||||||||
| (US$ Millions) | 2020 | 2019 | 2020 | 2019 | ||||||||
| Commercial property and hospitality revenue | $ | 1,433 | $ | 1,894 | $ | 6,099 | $ | 7,600 | ||||
| Direct commercial property and hospitality expense | (566 | ) | (783 | ) | (2,564 | ) | (3,186 | ) | ||||
| 867 | 1,111 | 3,535 | 4,414 | |||||||||
| Investment and other revenue | 187 | 193 | 494 | 603 | ||||||||
| Share of net earnings from equity accounted investments | (32 | ) | 470 | (749 | ) | 1,969 | ||||||
| 1,022 | 1,774 | 3,280 | 6,986 | |||||||||
| Expenses | ||||||||||||
| Interest expense | (642 | ) | (730 | ) | (2,592 | ) | (2,924 | ) | ||||
| Depreciation and amortization | (66 | ) | (85 | ) | (319 | ) | (341 | ) | ||||
| General and administrative expense | (220 | ) | (226 | ) | (816 | ) | (882 | ) | ||||
| Investment and other expense | (51 | ) | (72 | ) | (69 | ) | (82 | ) | ||||
| 43 | 661 | (516 | ) | 2,757 | ||||||||
| Fair value gains, net | (53 | ) | 869 | (1,322 | ) | 596 | ||||||
| Income tax (expense) benefit | (28 | ) | 21 | (220 | ) | (196 | ) | |||||
| Net income | $ | (38 | ) | $ | 1,551 | $ | (2,058 | ) | $ | 3,157 | ||
| Net income attributable to: | ||||||||||||
| General partner | $ | — | $ | — | $ | — | $ | — | ||||
| Limited partners | (180 | ) | 475 | (1,098 | ) | 884 | ||||||
| Non-controlling interests: | ||||||||||||
| Limited partner units of the operating partnership held by Brookfield Asset Management Inc. | (192 | ) | 472 | (1,119 | ) | 896 | ||||||
| Limited partner units of Brookfield Office Properties Exchange LP | (1 | ) | 3 | (7 | ) | 6 | ||||||
| FV LTIP units of the operating partnership | (1 | ) | 1 | (4 | ) | 1 | ||||||
| Class A shares of Brookfield Property REIT | (16 | ) | 71 | (130 | ) | 169 | ||||||
| Interests of others in operating subsidiaries and properties | 352 | 529 | 300 | 1,201 | ||||||||
| $ | (38 | ) | $ | 1,551 | $ | (2,058 | ) | $ | 3,157 | |||
RECONCILIATION OF NON-IFRS MEASURES
| Three Months Ended | Twelve Months Ended | |||||||||||
| Dec. 31, | Dec. 31, | |||||||||||
| (US$ Millions) | 2020 | 2019 | 2020 | 2019 | ||||||||
| Commercial property and hospitality revenue | $ | 1,433 | $ | 1,894 | $ | 6,099 | $ | 7,600 | ||||
| Direct commercial property and hospitality expense | (566 | ) | (783 | ) | (2,564 | ) | (3,186 | ) | ||||
| NOI | 867 | 1,111 | 3,535 | 4,414 | ||||||||
| Investment and other revenue | 187 | 193 | 494 | 603 | ||||||||
| Share of equity accounted income excluding fair value gains | 138 | 292 | 654 | 914 | ||||||||
| Interest expense | (642 | ) | (730 | ) | (2,592 | ) | (2,924 | ) | ||||
| General and administrative expense | (220 | ) | (226 | ) | (816 | ) | (882 | ) | ||||
| Investment and other expense | (51 | ) | (72 | ) | (69 | ) | (82 | ) | ||||
| Depreciation and amortization of non-real estate assets | (17 | ) | (13 | ) | (70 | ) | (58 | ) | ||||
| Non-controlling interests of others in operating subsidiaries and properties in FFO | (133 | ) | (218 | ) | (429 | ) | (838 | ) | ||||
| FFO | 129 | 337 | 707 | 1,147 | ||||||||
| Depreciation and amortization of non-real estate assets, net(1) | 12 | 9 | 48 | 40 | ||||||||
| Transaction costs(1) | 28 | 24 | 33 | 96 | ||||||||
| Gains/losses on disposition of non-investment properties(1) | — | (1 | ) | 3 | (1 | ) | ||||||
| Imputed Interest(2) | 2 | 7 | 23 | 49 | ||||||||
| LP Investments realized gains(3) | 120 | 80 | 137 | 167 | ||||||||
| BSREP III earnings(4) | (4 | ) | 3 | 1 | 14 | |||||||
| Company FFO and realized gains | $ | 287 | $ | 459 | $ | 952 | $ | 1,512 | ||||
| FFO | $ | 129 | $ | 337 | $ | 707 | $ | 1,147 | ||||
| Depreciation and amortization of real estate assets | (49 | ) | (72 | ) | (249 | ) | (283 | ) | ||||
| Fair value (losses) gains, net | (53 | ) | 869 | (1,322 | ) | 596 | ||||||
| Share of equity accounted income – Non FFO | (170 | ) | 178 | (1,403 | ) | 1,055 | ||||||
| Income tax (expense) benefit | (28 | ) | 21 | (220 | ) | (196 | ) | |||||
| Non-controlling interests of others in operating subsidiaries and properties in non-FFO | (219 | ) | (311 | ) | 129 | (363 | ) | |||||
| Non-controlling interests of others in operating subsidiaries and properties | 352 | 529 | 300 | 1,201 | ||||||||
| Net income | $ | (38 | ) | $ | 1,551 | $ | (2,058 | ) | $ | 3,157 | ||
| (1) Presented net of non-controlling interests on a proportionate basis. | ||||||||||||
| (2) Represents imputed interest on commercial developments accounted for under the equity method under IFRS. | ||||||||||||
| (3 )Net of associated carried interest to be due at a future date. | ||||||||||||
| (4) BSREP III is now accounted for as a financial asset which results in FFO being recognized in line with distributions. As such, the BSREP III earnings adjustment reflects our proportionate share of the Company FFO. | ||||||||||||
NET INCOME PER UNIT
| Three months ended | |||||||||||||||||
| Dec. 31, 2020 | Dec. 31, 2019 | ||||||||||||||||
| (US$ Millions, except per unit amounts) | Net income attributable to Unitholders | Average number of units | Per unit | Net income attributable to Unitholders | Average number of units | Per unit | |||||||||||
| Basic | $ | (390 | ) | 927.3 | $ | (0.42 | ) | $ | 1,022 | 947.2 | $ | 1.08 | |||||
| Preferred share dividends | (11 | ) | — | — | (7 | ) | — | — | |||||||||
| Number of units on conversion of preferred shares(1) | — | 70.1 | — | — | 70.1 | — | |||||||||||
| Basic per IFRS | (401 | ) | 997.4 | (0.40 | ) | 1,015 | 1,017.3 | 1.00 | |||||||||
| Dilutive effect of conversion of options | — | — | — | — | — | — | |||||||||||
| Fully-diluted per IFRS | $ | (401 | ) | 997.4 | $ | (0.40 | ) | $ | 1,015 | 1,017.3 | $ | 1.00 | |||||
| (1) IFRS requires the inclusion of preferred shares that are mandatorily convertible into units at a price of $25.70 without an add back to earnings of the associated carry on the preferred shares. | |||||||||||||||||
| Three months ended | |||||||||||||||||
| Dec. 31, 2020 | Dec. 31, 2019 | ||||||||||||||||
| (US$ Millions, except per unit amounts) | Net income attributable to Unitholders | Average number of units | Per unit | Net income attributable to Unitholders | Average number of units | Per unit | |||||||||||
| Basic per management | $ | (390 | ) | 927.3 | $ | (0.42 | ) | $ | 1,022 | 947.2 | $ | 1.08 | |||||
| Preferred share dividends | (11 | ) | — | — | (7 | ) | — | — | |||||||||
| Dilutive effect of conversion of preferred shares(1) | 29 | 70.1 | 0.41 | 29 | 70.1 | 0.41 | |||||||||||
| Dilutive effect of conversion of options | — | — | — | — | — | — | |||||||||||
| Fully-diluted per management | $ | (372 | ) | 997.4 | $ | (0.37 | ) | $ | 1,044 | 1,017.3 | $ | 1.03 | |||||
| (1) Represents preferred shares that are mandatorily convertible into units at a price of $25.70 and the associated carry. | |||||||||||||||||
NET INCOME PER UNIT
| Twelve months ended | ||||||||||||||||
| Dec. 31, 2020 | Dec. 31, 2019 | |||||||||||||||
| (US$ Millions, except per unit amounts) | Net income attributable to Unitholders | Average number of units | Per unit | Net income attributable to Unitholders | Average number of units | Per unit | ||||||||||
| Basic | $ | (2,358 | ) | 934.9 | $ | (2.52 | ) | $ | 1,956 | 955.0 | $ | 2.05 | ||||
| Preferred share dividends | (42 | ) | — | — | (15 | ) | — | — | ||||||||
| Number of units on conversion of preferred shares(1) | — | 70.1 | — | — | 70.1 | — | ||||||||||
| Basic per IFRS | (2,400 | ) | 1,005.0 | (2.39 | ) | 1,941 | 1,025.1 | 1.89 | ||||||||
| Dilutive effect of conversion of capital securities and options(2) | — | — | — | 8 | 6.7 | 1.19 | ||||||||||
| Fully-diluted per IFRS | $ | (2,400 | ) | 1,005.0 | $ | (2.39 | ) | $ | 1,949 | 1,031.8 | $ | 1.89 | ||||
| (1) IFRS requires the inclusion of preferred shares that are mandatorily convertible into units at a price of $25.70 without an add back to earnings of the associated carry on the preferred shares. | ||||||||||||||||
| (2) For the twelve months ended December 31, 2020, capital securities were fully redeemed and therefore excluded from the calculation of fully-diluted net income per IFRS. | ||||||||||||||||
| Twelve months ended | ||||||||||||||||
| Dec. 31, 2020 | Dec. 31, 2019 | |||||||||||||||
| (US$ Millions, except per unit amounts) | Net income attributable to Unitholders | Average number of units | Per unit | Net income attributable to Unitholders | Average number of units | Per unit | ||||||||||
| Basic per management | $ | (2,358 | ) | 934.9 | $ | (2.52 | ) | $ | 1,956 | 955.0 | $ | 2.05 | ||||
| Preferred share dividends | (42 | ) | — | — | (15 | ) | — | — | ||||||||
| Dilutive effect of conversion of preferred shares(1) | 117 | 70.1 | 1.67 | 117 | 70.1 | 1.67 | ||||||||||
| Dilutive effect of conversion of capital securities and options(2) | — | — | — | 8 | 6.7 | 1.19 | ||||||||||
| Fully-diluted per management | $ | (2,283 | ) | 1,005.0 | $ | (2.27 | ) | $ | 2,066 | 1,031.8 | $ | 2.00 | ||||
| (1) Represents preferred shares that are mandatorily convertible into units at a price of $25.70 and the associated carry. | ||||||||||||||||
| (2) For twelve months ended December 31, 2020, capital securities were fully redeemed and therefore excluded from the calculation of fully-diluted net income per IFRS. | ||||||||||||||||
