Letter to Unitholders

Dear Fellow Artis Unitholders:

This is my fourth annual letter to you, our valued unitholders, having now concluded my third full year as President and CEO of Artis REIT. Over the past three years, both Artis and the broader economic landscape have undergone significant changes. In 2023, external factors continued to have a significant impact on our business, in particular our interest costs and our net asset value (“NAV”) per unit. Broader market forces continue to put pressure on Artis’s trading price, resulting in a substantial gap between our NAV per unit and the market value of our units. This NAV-to-market-value gap is not a challenge that we face alone; in fact, this is prevalent across the Canadian real estate sector.  Higher interest rates, and the corresponding impact on borrowing costs, capitalization rates, and the transaction landscape have created headwinds that the entire sector must navigate. Despite these hurdles, the Artis Board and management team continue to hold an unwavering resolve and commitment to focus on the things that are within our control in order to achieve our fundamental goal of maximizing value for unitholders.

Throughout 2023, there was persistent speculation about an impending recession. The markets we are navigating through today, shaped by the ongoing battle between current inflation levels and the actions of the Federal Reserve and Bank of Canada, continue to present challenges for investors. The promising news of potential interest rate cuts later in the year bodes well for the real estate industry, and we anticipate that this will stimulate increased transactional activity and capital deployment among investors who are currently pens down.

When we announced our vision and strategy for Artis in March 2021, we gave ourselves a two-to-three-year timeline to execute our new plan. At the same time, we recognized that value investing by nature requires patience. Nobody controls the market. Value investing is based on the fundamental premise of “buying low and selling high”, but selling high is dependent on both internal and external factors and often one has to time the market to achieve the desired and optimal outcome. In my March 2023 annual letter to unitholders, mindful of the fact that we were entering our third year, I was clear that if our units continued to trade at a significant discount, market permitting, we would consider other options available to achieve and fulfill our commitment to Artis’s unitholders – maximizing the value of their investment. With this in mind, in August of last year, Artis’s Board announced a strategic review process to consider and evaluate alternatives that may be available to the REIT to unlock and maximize value for unitholders. A Special Committee was formed, comprising Ben Rodney (Chair of Artis’s Board), Lis Wigmore (Chair of Artis’s Governance, Nominating, and Compensation Committee) and myself. The Board and Special Committee retained BMO Capital Markets to provide advisory services in connection with the strategic review. With the strategic review underway, the Special Committee, alongside our advisors, began the process of evaluating all options with the singular goal of closing the substantial gap between our trading price and the intrinsic value of Artis’s units for our owners.

The work we have undertaken over the past seven months enabled us to properly assess the current environment and options available to maximize value for our unitholders. We have explored various alternatives, including the potential sale of the REIT. Given the current market conditions, we do not believe that there is a buyer prepared to acquire the REIT at a reasonable value relative to our NAV; however, there remains healthy interest from potential buyers for high-quality retail, industrial, and office assets. In today’s market, office buyers are generally expecting bargain prices or vendor financing, neither of which are compatible with our goal of generating financial liquidity from dispositions. Between announcing the strategic review in August 2023 and filing our 2023 annual results on February 29, 2024, we completed or entered into unconditional agreements for $161.9 million of office sales on favourable terms, and going forward we will continue to consider additional office dispositions. We had also completed or entered into unconditional sale agreements for $256.2 million of retail assets and $55.5 million of industrial assets. This equates to $473.6 million of asset sales at prices in line with International Financial Reporting Standards (“IFRS”) values reported at December 31, 2023, including unconditional transactions, since August 2, 2023. We continue to evaluate opportunities to sell additional retail, office, and industrial assets, with a focus on the industrial portfolio, in our effort to further deleverage and strengthen the balance sheet, grow NAV per unit, and enhance liquidity.

As the strategic review process continues, our Board and management team remain focused on the productivity of our core business – our real estate assets and public securities investments. In addition to the oversight and day-to-day management of our diverse portfolio of assets, our primary objective continues to be reducing leverage and enhancing liquidity. This can be challenging, but it is especially important given the current economic environment.

Our portfolio continued to demonstrate operational strength over the last year. The leasing momentum and traction that we experienced in 2022 continued throughout 2023. Our leasing team negotiated and signed new leases and renewals for approximately 1.9 million square feet from January to December. We ended the year with occupancy (including commitments) of 90.9%. Our tenants continue to show resilience despite the volatility businesses have faced over the last several years. The promise of 2024 is already taking shape as our leasing momentum from 2023 has again continued into the new year.

One of our most important key performance indicators (“KPIs”) is NAV per unit. With respect to our 2023 financial performance, at December 31, 2023, our NAV per unit was $13.96, compared to $17.38 at December 31, 2022. The drop of over $3 per unit is due to various factors, the most significant of which is fair value losses on investment properties, a product of the upward movement in capitalization rates noted earlier. We are disappointed with this result and the fact that our units continue to trade at a significant discount to NAV. Despite the current market skepticism towards diversified REITs, our operating metrics affirm that the quality of our real estate provides operating stability during an incredibly challenging time for the real estate sector.

Despite the external headwinds we faced in 2023, we have also had noteworthy successes in the year. In this letter, I will provide an update on our key accomplishments and challenges in 2023, and outline the road ahead.

Year In Review

Our fundamental near-term objectives in 2023 were to reduce leverage and enhance liquidity to strengthen our balance sheet, while concurrently focusing on bridging the value gap between our intrinsic value and the current trading price of our units. The pursuit of these objectives resulted in capital allocation decisions that included selling assets, refinancing mortgages, obtaining new mortgage financing, and monetizing public securities.

Below, I have summarized our notable investments and capital allocation initiatives in 2023.

Disposition Strategy

In 2023, we sold 17 assets including nine industrial, five retail, and three office, and a parcel of development land. The aggregate sale price for these dispositions was $322.4 million, which translated to proceeds of $222.0 million net of costs and related debt and the issuance of a note receivable. The sale prices were, on balance, in line with the IFRS fair values reported prior to the sales. The quality of our real estate portfolio, and the ongoing demand for attractive and well-located real estate, is reflected in the success of our disposition strategy and the pricing we have been able to achieve.

Our disposition strategy is an important component of our liquidity and balance sheet objectives. The liquidity generated from asset sales provides us with flexibility to pursue capital allocation initiatives that support our objectives and our commitment to unitholders.

Equity Securities Investments

The redefined strategy announced in 2021 contemplated value investing in equity securities investments of other publicly traded companies or real estate investment trusts (“REITs”). This includes investing in public securities where there is a disconnect between the value the market gives a company or REIT and the true underlying NAV per share or unit that the company or REIT is worth. Identifying companies or REITs that have exceptional properties in strong markets that we can own by investing in these entities through public shares or units is a cost-effective way for Artis to achieve an ownership interest at an often-significant discount to what it would ultimately cost to buy these properties directly.

As a result of recent macroeconomic conditions and our near-term focus on enhancing liquidity and strengthening our balance sheet, we had to take a hard look at our investments from a capital allocation perspective.

At December 31, 2022, our equity securities of Dream Office Real Estate Investment Trust (“Dream Office”) and First Capital Real Estate Investment Trust (“First Capital”) carried an aggregate fair value of $316.8 million. In June 2023, we had an opportunity to participate in Dream Office’s substantial issuer bid, pursuant to which we sold approximately 2.2 million units for aggregate sale proceeds of approximately $34 million. This was a capital allocation decision that supported our liquidity objectives. Building on this, during the third and fourth quarter we monetized additional equity securities, and we ended 2023 with equity securities carrying an aggregate fair value of $152.0 million.

In 2022, as part of the REIT’s value-investing strategy, Artis and a consortium of partners closed on the acquisition and privatization of Cominar Real Estate Investment Trust (“Cominar”). We saw this as an opportunity to acquire quality, well-located real estate for much less than its true value. In 2023, we completed the sale of several Cominar assets with additional dispositions in the pipeline. We are working on various means available to reduce our cost of capital in Cominar, while simultaneously pursuing additional dispositions and exploring opportunities to substantially enhance the density at a number of our core retail sites in greater Montreal.

As conveyed earlier, value investing by definition requires patience and time to realize the full potential of any investment. While we are required to mark to market our investments on a quarterly basis, it is time combined with our active engagement in these investments that will ultimately produce the results we aim to achieve.

As our balance sheet and liquidity strengthen, we will be better positioned to further engage with the board and management of our various investee companies to collaborate on ways to unlock and maximize value within each investee company.

Normal Course Issuer Bid

We continue to consider our normal course issuer bid (“NCIB”) to be one of the most powerful tools available to enhance value for our owners. During the last three NCIB terms, we have acquired the maximum number of common units allowable. These units were purchased at a significant discount to the NAV per unit of $13.96 at December 31, 2023. Under the most recent NCIB term that expired on December 18, 2023, we acquired 7,860,942 units at a weighted-average price of $7.35. 

Under previous NCIB terms, we implemented an automatic purchase plan agreement (“APP”) with a broker to allow for the purchase of its common and preferred units at times when Artis ordinarily would not be active in the market due to quarterly or self-imposed trading blackout periods. The APP is coterminous with the NCIB and, therefore, the APP also expired on December 18, 2023. Effective December 19, 2023, we renewed our NCIB and on March 5, 2024, we announced that we have implemented an APP. 

With our units continuing to trade on the market significantly below our NAV per unit, utilizing our NCIB is a low-risk use of capital that increases intrinsic value and benefits our investors by increasing their effective ownership stake in Artis. With the APP now in place, we expect to continue to use our NCIB as a tool to enhance unitholder value.

Development Projects

Development projects have been an important component of Artis’s strategy as they reward our unitholders with additional income streams as lease up occurs while also increasing the overall caliber and value of our portfolio. Going into 2023, we had three development projects underway: (i) Park Lucero East; (ii) Blaine 35 II; and (iii) 300 Main.

Park Lucero East is an industrial development project located in the Greater Phoenix Area, Arizona, in which Artis has a 10% ownership interest and a development management contract in place. This project comprises three buildings totalling approximately 561,000 square feet. Each building was pre-leased to single tenants pursuant to leases that commenced in 2023. We anticipate exiting this investment in 2024 and plan to monetize both our equity and carried interest in the project.

Blaine 35 II is the second and final phase of a three-building, 317,483 square foot industrial development in the Twin Cities Area, Minnesota. Blaine II comprises two buildings totalling approximately 198,900 square feet of leasable area. The project is 100% leased.

Lastly, during the year we completed the development of 300 Main, a 40-storey residential and commercial project in Winnipeg, Manitoba. In 2022, Earls Kitchen + Bar opened on the main floor of the building. We welcomed our first residential tenants to the building on July 1, 2023, and leasing efforts for the remaining suites are underway. As leasing progresses, we will see increasing contribution to our overall financial results, both from a revenue and net operating income perspective.

Real Estate Holdings

We sold a number of properties last year and, to meet our liquidity and balance sheet objectives, expect to sell additional properties in 2024. In the current market environment, we have intentionally chosen to look at markets and assets that have liquidity and strong values, which aligns with the principle of “buying low and selling high”. The current environment is one where cash is king. Continuing on the path of reducing leverage and enhancing liquidity will provide us with flexibility to consider allocating capital to opportunities that we believe provide us with above-average risk-adjusted returns. From a capital allocation standpoint, we remain committed to maintaining a meaningful allocation of our capital to direct ownership of income-producing real estate assets.

Balance Sheet and Liquidity

Our primary near-term objectives remain clear: reduce leverage and enhance liquidity to strengthen our balance sheet, while concurrently focusing on bridging the value gap between our intrinsic value and the current trading price of our units. In the face of broader market challenges, we remain focused on what we can control as we navigate the current environment.

We ended 2023 with liquidity of $164.3 million. During 2023, we repaid a net balance of $53.0 million on our revolving credit facilities, repaid the Series D senior unsecured debentures upon maturity with a face value of $250.0 million, repaid maturing mortgages in the amount of $175.1 million, and repaid mortgages in conjunction with property dispositions in the amount of $75.5 million. Also during the year, we drew on construction loans in the amount of $188.9 million and received new mortgage financing in the amount of $124.8 million. We ended the year with total debt of $1.9 billion compared to $2.2 billion at December 31, 2022. This translated into total debt to gross book value (“GBV”) of 50.9% at December 31, 2023, compared to 48.5% at December 31, 2022.  This uptick in our leverage ratio, despite the lower total debt balance, was due primarily to the fair value decrease in our income producing properties. With the firm dispositions announced to date in 2024 and additional dispositions in the pipeline, we anticipate a significant reduction in both total debt and our total debt to GBV in 2024.

At December 31, 2023, NAV per unit was $13.96, compared to $17.38 at December 31, 2022.  The change is due to various factors, the most significant of which was fair value losses on investment properties as noted above.

There are numerous levers available to strengthen our balance sheet and enhance liquidity, including selling assets, refinancing mortgages, obtaining new mortgage financing, and monetizing public securities. Striking the right balance between these levers will be critical to effectively managing our business defensively through the external market challenges and ensuring a successful path forward.

The Road Ahead

Three years have passed since we announced our redefined strategy. Since then, our units have continued to trade at a significant discount to NAV. We remain committed in our pursuit of narrowing this gap. Global events, both economic and geopolitical, continue to change and exert a widespread effect on our daily lives and the businesses within which we operate. While there are many external economic and market-based factors that are out of our control, we will continue to focus on what is within our control – our business. At the same time, it is important to not let quarter-to-quarter reporting dictate and influence our decisions insofar as capital allocation and our fundamental conviction around value investing. As I have conveyed previously, Warren Buffett said “In the short run, the market is a voting machine. In the long run, it’s a weighing machine.” For Artis, weight is measured by NAV per unit.  We will continue to do everything we can to increase the weight of our company.

Throughout 2024, we will focus on the following:

Key Performance Indicators

Our KPIs are the REIT’s NAV per unit, adjusted funds from operations (“AFFO”) per unit, AFFO payout ratio, debt-to-gross book value, and distribution per unit. We plan to use the proceeds from dispositions during the year to reduce debt and reallocate some of the capital into initiatives that we believe will achieve the highest possible return over time, ultimately contributing to our most important objective – growing NAV per unit. Our improved liquidity position will allow us to be opportunistic and pursue investments we believe are in line with our strategy, which may include equity securities and real estate acquisitions or developments.

Drive Organic Growth

Our organic growth strategy has three main objectives: 1) managing our existing portfolio to achieve optimal efficiency; 2) improving our portfolio’s income profile by extracting the maximum value from each individual asset; and 3) constructing, as an owner or development manager, state-of-the-art new generation real estate in strategic locations that are expected to generate strong development yields.

Leasing activity during 2023 remained strong throughout the year. During the 12-month period, approximately 1.9 million square feet of new leases and renewals were negotiated and signed. This included many new leases for space at development projects, which speaks to the continued demand for new generation real estate that is well positioned and designed with features that appeal to the target market.

There were 1,163,799 square feet of new leases and 1,024,276 square feet of renewals that began in 2023. The renewals were negotiated at a weighted-average rental increase of 4.8% compared to expiring rents. We were pleased to report a strong 7.6% increase in same property net operating income year over year. Same property net operating income growth is an important metric, and one that we will continue to monitor closely in the quarters ahead.

Development projects similarly present a compelling opportunity to generate income and create value for our owners. We completed three projects in 2023, including two industrial properties that are fully leased and our mixed-use development at 300 Main that includes 18,481 square feet of retail space and 395 residential rental units.

Sustainability initiatives are another important element of our organic growth strategy. These initiatives result in cost benefits and efficiencies and implementation of environmental best practices often translates directly to organic growth. Analysis of key environmental risks (including both physical and transitional climate risks) allows us to proactively allocate capital, both with respect to our existing portfolio and our new development projects, to ensure these investments are best positioned to produce long-term sustainable growth for our unitholders. Tenant engagement is an important component. Strong rapport is important in any successful business relationship and contributes to promoting tenant retention. In 2023, we conducted our second annual tenant satisfaction survey. These surveys are a valuable tool to help us to understand what we are doing well and where there is opportunity for improvement. Our ESG Community website has provided an effective means of engaging with our tenants on ESG matters.  This website is exclusively for tenants and was created to foster our ongoing commitment to the environment, corporate social responsibility, and sustainability. We are fulfilling this commitment by providing a platform for collaboration on ESG matters and developing a long-term ESG strategy for employees, tenants, investors, and stakeholders.

Through new and innovative avenues, we can engage with our tenants and work together as partners in pursuit of environmental protection and sustainability. Collectively we can make an impactful and positive change.


On December 15, 2023, we renewed our NCIB. Under the terms of this bid, we can acquire up to 7,021,296 units prior to its expiry on December 18, 2024. We view our NCIB as a very valuable tool to enhance unitholder value during times when our units are trading at a discount to NAV. We expect to utilize our NCIB over the course of 2024 through our APP mentioned above. 

Environmental, Social and Governance

Artis is committed to conducting its business in a sustainable manner, with a focus on continuous and measurable improvement and transparency in all areas of its environmental, social, and governance performance. This extends beyond sustainability initiatives at the property level to our overall Environmental, Social, and Governance (“ESG”) initiatives across the organization. As part of our strategy, we committed to making ESG a focal point and to establishing a company-wide ESG-minded culture at Artis – a commitment we have taken very seriously.

Over the last three years we have made significant progress with our efforts to adopt ESG best practices. Through our ongoing sustainability initiatives, we are confident in our ability to reduce our environmental impact, make a positive change in the communities in which we operate, strengthen our business, and create a culture that allows us to attract, retain, and develop the best talent. We look forward to publishing our 2023 ESG Report in the coming months, which will provide an update on this important part of our strategy.

Final Thoughts and Our Annual General Meeting

2023 was a challenging year in many respects, including the rising interest rate environment that we witnessed and, with persistently high inflation data, the evolution of the “higher for longer” stance taken by the Bank of Canada and the Federal Reserve. The high level of floating rate debt that Artis had going into 2023 was a concern as we navigated the impact and effect of rising interest rates. We began last year with a commitment to reduce debt through monetizing assets, despite the expectation some had at that time that rates would come down as 2023 progressed. While the latter did not materialize, our plan to reduce debt served us well insofar as our ability to navigate the year and set the stage for 2024. A number of sale transactions we secured in 2023 will close in the first half of 2024 and this will have a positive impact on our goal of reducing leverage and enhancing liquidity. If we continue the momentum we have with our disposition plan, we will further strengthen our balance sheet and liquidity position. This in turn will give us a greater level of flexibility and potentially put us in a position where we can go from defence to offence.

As noted previously, our recent strategic review update confirmed that the current market environment is not conducive to attracting buyers for the entire REIT. The Board and management team are well aware that Artis’s unit price continues to trade at a significant discount to its NAV per unit. As we have stated in the past, this is not acceptable. We remain committed to using all near-term levers available to us to address this issue. At the same time, we will continue to evaluate opportunities available to us from a capital allocation standpoint to grow NAV. Our investments in Dream Office and First Capital represent capital allocation decisions that followed monetizing office and retail assets at fair market value and  allocating a portion of the sale proceeds to companies that we believed were materially undervalued. Warren Buffett said, “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” In selling our own assets at full value and buying these investments at what we believed to be a discount to fair value, we allocated capital in a manner that we believe will benefit Artis’s owners in the long term. Recently, Blackstone announced it would acquire Tricon Residential REIT. I believe this is just the beginning of what could be a busy year for M&A activity in the public real estate space. Blackstone is just one of many private equity firms that have raised substantial capital that has yet to be put to work. I believe that both Dream Office and First Capital represent wonderful companies that are materially undervalued and could be potential targets for M&A activity. Even at what Warren Buffett refers to as a “fair price,” these companies would sell for meaningful premiums to their current trading price. While there is no guarantee this will happen, it is certainly a possibility as we finally start to see interest rate cuts on both sides of the border this year and the substantial dry powder currently on the sidelines go to work. 

As I said in my letter last year, when we announced a new vision and strategy for Artis three years ago, some people were excited about our unconventional plan; however, others were hesitant, if not outright opposed. We knew we would need to earn people’s trust through successful execution and results. External factors have made the past couple of years very difficult, but history has demonstrated that there will always be ebbs and flows, periods of time when the economy provides tailwinds for our business and periods when it creates headwinds. While we did not identify a buyer for the REIT through our strategic review process, we will continue to focus on the big picture. This means focusing on the value of our units, not the price of our units. We are confident that with the continued execution of our plan, clear communication, and demonstrating a track record of success, we will be able to narrow the gap between the value and price of our units, and our owners will be rewarded in the long term. Rest assured, we will do our best to stay true to the commitment we presented to our owners in March 2021. All of this will require patience, a fundamental criteria of value investing. We know this patience is not easy to maintain with the decline we have seen in our unit price, but I believe we will see the benefit on the other side as interest rates decrease and real estate values begin to increase.  

Thank you for trusting us with your capital. While we still have a lot of work ahead of us, we look forward to the rest of 2024 with even greater determination and resolve to work hard for our unitholders and to deliver stronger results.

In closing, I invite all our stakeholders to join us in person at our next annual general meeting scheduled for 2:00 pm ET on May 23, 2024, at the Hilton Toronto hotel in downtown Toronto, Ontario. I look forward to seeing you there.

Samir A. Manji

President and Chief Executive Officer


Disclaimer and Forward-Looking Statements

All figures are presented in Canadian dollars unless otherwise noted. The information in this letter should be read in conjunction with the REIT’s audited annual consolidated financial statements for the years ended December 31, 2023, 2022 and 2021 and the REIT’s annual Management’s Discussion and Analysis (“MD&A”) for 2023, 2022 and 2021. These documents are available on SEDAR+ at www.sedarplus.ca or on Artis’s website at www.artisreit.com.

Certain statements contained in this letter are “forward-looking statements” within the meaning of applicable securities laws. Forward-looking statements reflect management’s expectations regarding the future growth, results of operations, performance, prospects and opportunities of Artis. Without limiting the foregoing, the words “expects”, “anticipates”, “intends”, “estimates”, “projects”, and similar expressions are intended to identify forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements.

All statements other than statements of historical fact contained or incorporated by reference herein may be deemed to be forward-looking statements including, without limitation, statements regarding the timing and amount of distributions and the future financial position, business strategy, potential acquisitions and dispositions, plans and objectives of Artis. Such forward-looking statements reflect management’s current beliefs and are based on information currently available to management. Artis cannot assure investors that actual results will be consistent with any forward-looking statements and, other than as required by applicable law, Artis assumes no obligation to update or revise such forward-looking statements to reflect actual events or new circumstances. All forward-looking statements contained in this letter are qualified by this cautionary statement.

Forward-looking statements may involve significant risks and uncertainties. A number of factors could cause actual results to differ materially from the results expressed or implied in forward-looking statements including risks relating to the REIT’s strategy, real property ownership, geographic concentration, current economic conditions, strategic initiatives, pandemics and other public health events, debt financing, interest rate fluctuations, foreign currency, tenants, SIFT Rules, other tax-related factors, illiquidity, competition, reliance on key personnel, future property transactions, general uninsured losses, dependence on information technology systems, cyber security, environmental matters and climate change, land and air rights leases, public market, market price of units, changes in legislation and investment eligibility, availability of cash flow, fluctuations in cash distributions, the nature of trust units, legal rights attaching to trust units, preferred units, debentures, dilution, unitholder liability, failure to obtain additional financing, potential conflicts of interest, developments, and trustees. Refer to the section entitled “Risks and Uncertainties” in the REIT’s 2023 Annual MD&A and the section entitled “Risk Factors” in the REIT’s Annual Information Form dated February 29, 2024, for additional information regarding risks and uncertainties.

Notice with Respect to Non-GAAP & Supplementary Financial Measures Disclosure

In addition to reported International Financial Reporting Standards (“IFRS”) measures, certain non-GAAP and supplementary financial measures are commonly used by Canadian real estate investment trusts as an indicator of financial performance. “GAAP” means the generally accepted accounting principles described by the CPA Canada Handbook – Accounting, which are applicable as at the date on which any calculation using GAAP is to be made. Artis applies IFRS, which is the section of GAAP applicable to publicly accountable enterprises.

Non-GAAP measures and ratios include Same Property Net Operating Income (“Same Property NOI”), Funds From Operations (“FFO”), Adjusted Funds from Operations (“AFFO”), FFO per Unit, AFFO per Unit, FFO Payout Ratio, AFFO Payout Ratio, Net Asset Value (“NAV”), NAV per Unit, Gross Book Value (“GBV”), Total Debt to GBV, Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), Adjusted EBITDA Interest Coverage Ratio and Total Debt to Adjusted EBITDA.

Management believes that these measures are helpful to investors because they are widely recognized measures of Artis’s performance and provide a relevant basis for comparison among real estate entities.

These non-GAAP and supplementary financial measures are not defined under IFRS and are not intended to represent financial performance, financial position or cash flows for the period, nor should any of these measures be viewed as an alternative to net income, cash flow from operations or other measures of financial performance calculated in accordance with IFRS. For a full description of these measures and a reconciliation to the most directly comparable measure calculated in accordance with IFRS, please refer to the “Notice with Respect to Non-GAAP and Supplementary Financial Measures Disclosure” section in the REIT’s 2023 Annual MD&A.

Equity Accounted Investments

At December 31, 2023, the REIT’s portfolio was comprised of 119 commercial properties totalling approximately 13.7 million square feet of gross leasable area. The REIT also has joint ownership interest in 11 investment properties, one parcel of development land and properties acquired as part of the acquisition of Cominar Real Estate Investment Trust (the “Cominar Transaction”), which have been excluded from financial and operating metrics throughout this letter, unless otherwise noted. Refer to the Equity Accounted Investments section of the 2023 Annual MD&A for further information.