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¨
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Registration statement pursuant to Section 12 of the Securities Exchange Act of 1934
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x
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Annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934
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Ontario, Canada
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(Exact name of registrant as specified in its charter)
1121, 1031, 1061, 1311, 1321, 2421, 4939, 6311
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Not applicable
|
(Province or other jurisdiction of
incorporation or organization)
|
|
(Primary Standard Industrial
Classification Code Number (if
applicable))
|
|
(I.R.S. Employer
Identification Number (if
Applicable))
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Title of each class
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Name of each exchange on which registered
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Class A Limited Voting Shares
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New York Stock Exchange
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x
Annual Information Form
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x
Audited Annual Financial Statements
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(a)
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Annual Information Form for the fiscal year ended December 31, 2018;
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(b)
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Management’s Discussion and Analysis of Financial Results (“
MD&A
”) for the fiscal year ended December 31, 2018; and
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(c)
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Consolidated Financial Statements for the fiscal year ended December 31, 2018.
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(a)
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Certifications
. See Exhibits 99.3, 99.4, 99.5 and 99.6 to this Annual Report on Form 40-F.
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(b)
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Disclosure Controls and Procedures
. As of the end of the registrant’s fiscal year ended December 31, 2018, an evaluation of the effectiveness of the registrant’s “disclosure controls and procedures” (as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “
Exchange Act
”)) was carried out by the registrant’s principal executive officer and principal financial officer.
Based upon that evaluation, the registrant’s principal executive officer and principal financial officer have concluded that as of the end of that fiscal year, the registrant’s disclosure controls and procedures were designed at a reasonable assurance level and were effective to provide reasonable assurance that information required to be disclosed by the registrant in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and (ii) accumulated and communicated to the registrant’s management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.
It should be noted that while the registrant’s principal executive officer and principal financial officer believe that the registrant’s disclosure controls and procedures provide a reasonable level of assurance that they are effective, they do not expect that the registrant’s disclosure controls and procedures or internal control over financial reporting will prevent all errors and fraud. A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.
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(c)
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Management’s Annual Report on Internal Control Over Financial Reporting
.
(1) Management of the registrant is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed by, or under the supervision of, the Chief Executive Officer and the Chief Financial Officer and effected by the Board of Directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
(2) Management assessed the effectiveness of the registrant’s internal control over financial reporting as of December 31, 2018, based on the criteria set forth in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
(3) Based on this assessment, management concluded that, as of December 31, 2018, the registrant’s internal control over financial reporting was effective. Also, management determined that there were no material weaknesses in the registrant’s internal control over financial reporting as of December 31, 2018.
(4) Deloitte LLP, the independent registered public accounting firm that audited the registrant’s consolidated financial statements for the fiscal year ended December 31, 2018, has issued its opinion on the registrant’s internal control over financial reporting (the “
Attestation Report
”).
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(d)
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Attestation Report of the Independent Registered Public Accounting Firm
. The Attestation Report is included in Exhibit 99.2 attached hereto, which is incorporated by reference into this Annual Report on Form 40-F.
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(e)
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Changes in Internal Control over Financial Reporting
. During the fiscal year ended December 31, 2018, there were no changes in the registrant’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
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A.
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Undertaking.
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B.
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Consent to Service of Process.
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BROOKFIELD ASSET MANAGEMENT INC.
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||
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By:
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/s/ Brian D. Lawson
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Name:
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Brian D. Lawson
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Title:
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Managing Partner and Chief Financial Officer
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Exhibit
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Description
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Annual Information Form for the fiscal year ended December 31, 2018
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Management’s Discussion and Analysis of Financial Results for the fiscal year ended December 31, 2018, the Consolidated Financial Statements for the fiscal year ended December 31, 2018, and the Attestation Report of the Independent Registered Public Accounting Firm
|
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Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934
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Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934
|
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Certification of Chief Executive Officer pursuant to Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 and Section 1350 of Chapter 63 of Title 18 of the United States Code
|
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Certification of Chief Financial Officer Form pursuant to Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 and Section 1350 of Chapter 63 of Title 18 of the United States Code
|
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Consent of Deloitte LLP
|
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101.INS
|
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XBRL Instance Document
|
|
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101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
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101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
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101.DEF
|
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XBL Taxonomy Extension Definition Linkbase Document
|
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
|
The Corporation
|
1
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Cautionary Statement Regarding Forward-Looking Statements and Information
|
2
|
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Subsidiaries
|
3
|
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Development of the Business
|
3
|
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Business of the Corporation
|
11
|
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Code of Business Conduct and Ethics
|
19
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Business Environment and Risks
|
19
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Environmental, Social and Governance Management
|
19
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Corporate Governance Practices
|
20
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Directors and Officers
|
22
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Market for Securities
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25
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Ratings and Liquidity
|
26
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Dividends and Dividend Policy
|
28
|
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Description of Capital Structure
|
30
|
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Transfer Agent and Registrar
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31
|
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Material Contracts
|
31
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Interests of Experts
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32
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Audit Committee Information
|
32
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Additional Information
|
33
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Appendices:
|
|
|
A. Trading Information for the Corporation’s Publicly Listed Securities
|
A-1
|
|
B. Summary of Terms and Conditions of the Corporation’s Authorized Securities
|
B-1
|
|
C. Charter of the Audit Committee of the Board of Directors of the Corporation
|
C-1
|
|
Name
|
Jurisdiction of Formation
|
Percentage of Voting Securities Owned, Controlled or Directed
|
Equity Ownership Interest
|
Brookfield Business Partners L.P.
(a)
|
Bermuda
|
100%
|
68%
|
Brookfield Infrastructure Partners L.P.
(b)
|
Bermuda
|
100%
|
30%
|
Brookfield Renewable Partners L.P.
(c)
|
Bermuda
|
100%
|
61%
|
Brookfield Property Partners L.P.
(d) (e)
|
Bermuda
|
100%
|
51%
|
(a)
The Corporation owns a 100% general partnership interest. The Corporation owns general partnership units, limited partnership units and units exchangeable into limited partnership units representing an approximate 68
%
economic ownership interest in Brookfield Business Partners L.P. (on a fully exchanged basis).
(b)
The Corporation owns a 100% general partnership interest. The Corporation owns general partnership units, limited partnership units and units exchangeable into limited partnership units representing an approximate 30% economic ownership interest in Brookfield Infrastructure Partners L.P. (on a fully exchanged basis).
(c)
The Corporation owns a 100% general partnership interest. The Corporation owns general partnership units, limited partnership units and units exchangeable into limited partnership units representing an approximate 61% economic ownership interest in Brookfield Renewable Partners L.P. (on a fully exchanged basis).
(d)
The Corporation owns a 100% general partnership interest. The Corporation owns general partnership units, limited partnership units, units exchangeable into limited partnership units and shares of Class A Stock of Brookfield Property REIT Inc.
(“BPR”)
, a subsidiary of Brookfield Property Partners L.P. (which are exchangeable into limited partnership units of Brookfield Property Partners L.P.) representing an approximate 51% economic ownership interest in Brookfield Property Partners L.P. (on a fully exchanged, “as-converted” basis).
(e)
BPR is a subsidiary of Brookfield Property Partners L.P., which, along with its affiliates, controls 91% of the voting power of BPR. The Corporation indirectly controls 49% of the shares of Class A stock of BPR, which are exchangeable into limited partnership units of Brookfield Property Partners L.P., through its ownership interest in Brookfield Property Partners L.P.
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ü
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Investment focus
|
ü
|
Diverse products offering
|
ü
|
Focused investment strategies
|
ü
|
Disciplined financing approach
|
1.
|
Large-scale capital
|
2.
|
Operating expertise
|
3.
|
Global presence
|
i.
|
Asset management
operations include managing our listed partnerships, private funds and public securities on behalf of our investors and ourselves. We generate contractual base management fees for these activities as well as incentive distributions and performance income, including performance fees, transaction fees and carried interest. Common equity in our asset management segment is immaterial.
|
ii.
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Real estate
operations include the ownership, operation and development of core office, core retail, LP investments and other properties.
|
iii.
|
Renewable power
operations include the ownership, operation and development of hydroelectric, wind, solar, storage and other power generating facilities.
|
iv.
|
Infrastructure
operations include the ownership, operation and development of utilities, transport, energy, data infrastructure and sustainable resource assets.
|
v.
|
Private equity
operations include a broad range of industries, and are mostly focused on business services, infrastructure services and industrial operations.
|
vi.
|
Residential development
operations consist of homebuilding, condominium development and land development.
|
vii.
|
Corporate activities
include the investment of cash and financial assets, as well as the management of our corporate leverage, including corporate borrowings and preferred equity, which fund a portion of the capital invested in our other operations. Certain corporate costs such as technology and operations are incurred on behalf of our operating segments and allocated to each operating segment based on an internal pricing framework.
|
•
|
We manage
$138 billion
of fee bearing capital, including
$70 billion
in private funds,
$54 billion
in listed partnerships and
$13 billion
within our public securities group.
|
•
|
We earn recurring long-term base management fees and generate performance fees from managing private funds, listed partnerships and public securities on behalf of investors.
|
•
|
We earn performance fees in the form of carried interest when achieving target returns in our funds and incentive distributions when distributions (for BPY, BEP and BIP) or unit price (for BBU) exceed pre-determined thresholds.
|
•
|
We manage our fee bearing capital through 42 active private funds across our major asset classes: real estate, infrastructure/renewable power and private equity. These funds include core, credit, value-add and opportunistic closed-end funds and core long-life funds. These are primarily invested in the equity of private companies, although in certain cases, are invested in publicly traded equities. Our credit strategies invest in debt of companies in our areas of focus.
|
•
|
We refer to our largest private fund series as our flagship funds. We have flagship funds within each of our major asset classes: Real Estate (BSREP series), Infrastructure (BIF series, which includes infrastructure and renewable power investments) and Private Equity (BCP series).
|
•
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Closed-end private fund capital is typically committed for 10 years from the inception of the fund with two one-year extension options.
|
•
|
Long-life private funds are perpetual vehicles that are able to continually raise capital as new investments arise.
|
•
|
We are compensated for managing these private funds through base management fees, which are generally determined on committed capital during the investment period and invested capital thereafter. We are entitled to receive carried interest on these funds, which represents a portion of fund profits above a preferred return to investors.
|
•
|
We manage fee bearing capital through publicly listed perpetual capital entities, including BPY, BEP, BIP, BBU, TerraForm Power and Acadian Timber Corp. (“Acadian”).
|
•
|
We are compensated for managing these entities through (i) base management fees, which are primarily determined by the market capitalization of these entities; and (ii) incentive distributions or performance fees.
|
•
|
Incentive distributions for BPY, BEP, BIP, TerraForm Power and Acadian are a portion of the increases in distributions above predetermined hurdles. Performance fees for BBU are based on increases in the unit price of BBU above an escalating threshold.
|
•
|
We manage our fee bearing capital through numerous funds and separately managed accounts, focused on fixed income and equity securities.
|
•
|
We act as advisor and sub-advisor, earning both base and performance fees.
|
•
|
We own and operate real estate assets primarily through a 54% (51% fully diluted) economic ownership interest in BPY and a 27.5% interest in a portfolio of operating and development assets in New York.
|
•
|
BPY is listed on the Nasdaq and TSX and had a market capitalization of $17.1 billion as at
December 31, 2018
.
|
•
|
BPY owns real estate assets directly as well as through private funds that we manage.
|
•
|
We own interests in and operate commercial office assets in gateway markets around the globe, consisting of 142 premier properties totaling 96 million square feet of office space.
|
•
|
The properties are located primarily in the world’s leading commercial markets such as New York, London, Los Angeles, Washington, D.C., Sydney, Toronto and Berlin.
|
•
|
We also develop properties on a selective basis; active development projects consist of seven office and eight multifamily sites, totaling 10 million square feet.
|
•
|
We own interests in and operate 124 best-in-class malls and urban retail properties in the United States, totaling 121 million square feet.
|
•
|
Our portfolio consists of 100 of the top 500 malls in the U.S.
|
•
|
Our retail mall portfolio has a development and redevelopment pipeline that exceeds $1 billion of development costs on a proportionate basis.
|
•
|
We own and operate global portfolios of real estate investments through our opportunistic real estate funds, which are targeted to achieve higher returns than our core office and core retail portfolios.
|
•
|
We invest in mispriced portfolios and/or properties with significant value-add opportunities.
|
•
|
Our LP Investments portfolios consist of high-quality assets with operational upside across the multifamily, triple net lease, hospitality, office, retail, mixed-use, self-storage, manufactured housing and student housing sectors.
|
•
|
We own and operate renewable power assets primarily through a
61%
ownership interest in BEP, which is listed on NYSE and TSX and had a market capitalization of $8.1 billion at
December 31, 2018
.
|
•
|
BEP owns one of the world’s largest publicly traded renewable power portfolios.
|
•
|
We own, operate and invest in 218 hydroelectric generating stations on 82 river systems in North America, Brazil and Colombia. Our hydroelectric operations have 7,906 MW of installed capacity and long-term average generation (“LTA”) of 20,033 GWh on a proportionate basis.
|
•
|
Our wind operations include 106 wind facilities globally with 4,448 MW of installed capacity and LTA generation of 5,372 GWh on a proportionate basis.
|
•
|
Our solar operations include 545 solar facilities globally with 1,787 MW of installed capacity and 974 GWh of LTA generation on a proportionate basis.
|
•
|
Our storage operations have 2,698 MW of installed capacity at four pumped storage facilities in North America and Europe.
|
•
|
We purchase a portion of BEP’s power generated in North America (predominantly in New York) pursuant to a long-term contract at predetermined prices, thereby increasing the stability of BEP’s revenue profile.
|
•
|
We sell the power into the open market and also earn ancillary revenues, such as capacity fees and renewable power credits and premiums. This provides us with increased participation in future increases or decreases in power prices.
|
•
|
We substantially transferred our North American energy marketing function (formerly Brookfield Energy Marketing Inc.) to BEP on October 31, 2018 along with our long-term power contract in Ontario. BEP will assume all the benefits of the contract, some of which previously accrued to us. This transfer was paid for by a reduction of the price paid to BEP on the New York contract which we continue to hold. Under the New York contract, we are required to purchase power that BEP generates at certain of its New York assets at a fixed price. Based on LTA, we will purchase approximately 3,600 GWh of power each year. The fixed price that we are required to pay BEP will gradually step down over time resulting in an approximate $20/MWh reduction by 2026 until the contract expiry in 2046.
|
•
|
We own and operate infrastructure assets primarily through our approximate
30%
economic ownership interest in BIP, which is listed on NYSE and TSX and had a market capitalization of $13.4 billion at
December 31, 2018
.
|
•
|
BIP is one of the largest globally diversified owners and operators of infrastructure in the world.
|
•
|
We also have direct investments in sustainable resource operations.
|
•
|
Our regulated transmission business includes approximately 2,000 km of natural gas pipelines in Brazil, approximately 2,200 km of transmission lines in North and South America, and approximately 2,700 km of greenfield electricity transmission under development in South America.
|
•
|
We own and operate 6.6 million connections, predominantly electricity and natural gas connections, and 1.1 million smart meters in our regulated distribution business.
|
•
|
Our regulated terminal operations includes approximately 85 million tons per annum of coal handling capacity.
|
•
|
These businesses typically generate long-term returns on a regulated or contractual asset base which increase with capital we invest to upgrade and/or expand our systems.
|
•
|
We operate approximately 5,500 km of railroad track in Western Australia and approximately 4,800 km of railroad track in South America.
|
•
|
Our toll road operations includes approximately 4,200 km of motorways in Brazil, Chile, Peru and India.
|
•
|
Our ports operations include 37 terminals in North America, the U.K., Australia and across Europe.
|
•
|
These operations are comprised of networks that provide transportation for freight, bulk commodities and passengers, for which we are paid an access fee. This includes businesses with price ceilings as a result of regulation, such as our rail and toll road operations, as well as unregulated businesses, such as our ports.
|
•
|
We own and operate approximately 15,000 km of natural gas transmission pipelines, primarily in the U.S., and 600 billion cubic feet of natural gas storage in the U.S. and Canada.
|
•
|
In our district energy business, we deliver approximately 3.4 million pounds per hour of heating and 336,000 tons of cooling capacity, as well as servicing approximately 24,900 natural gas, water and wastewater connections.
|
•
|
These operations are comprised of businesses, typically unregulated or subject to price ceilings, that provide energy transmission and storage services, with profitability based on the volume and price achieved for the provision of these services.
|
•
|
We own and operate approximately 7,000 multi-purpose communication towers and active rooftop sites and 5,500 km of fiber backbone located in France.
|
•
|
In our data storage business, we manage 33 data centers with 1.3 million square feet of raised floors and 103 MW of critical load capacity.
|
•
|
These businesses provide essential services and critical infrastructure to media broadcasting and telecom sectors and are secured by long-term inflation-linked contracts.
|
•
|
We own and operate private equity assets primarily through our
68%
interest in BBU. BBU is listed on NYSE and TSX and had a market capitalization of $3.9 billion at December 31, 2018.
|
•
|
BBU focuses on owning and operating high-quality businesses that benefit from barriers to entry and/or low production costs.
|
•
|
We also own certain businesses directly, including a
42%
interest in Norbord which is one of the world’s largest producers of oriented strand board.
|
•
|
We own and operate a road fuel distribution and marketing business with significant import and storage infrastructure, provide services to residential real estate brokers through franchise arrangements under a number of brands in Canada and facilities management services for corporate and government investors with over 300 million square feet of managed real estate.
|
•
|
We provide contracting services with a focus on high-quality construction of large-scale and complex landmark buildings and social infrastructure. Construction projects are generally delivered through contracts, whereby we take responsibility for design, program, procurement and construction at a defined price. Our backlog currently stands at $8 billion, with a weighted average remaining project life of 1.8 years.
|
•
|
Other operations in our business services include entertainment facilities in the Greater Toronto Area and a provider of high speed fixed wireless broadband in rural Ireland.
|
•
|
We are the leading provider of services to the global power generation industry, which includes providing original equipment or technology for approximately 50% of global nuclear capacity and servicing two thirds of the world’s nuclear reactors.
|
•
|
We also provide services to the offshore oil production industry, operating in northern Europe and Brazil.
|
•
|
Our industrial portfolio is comprised of capital intensive businesses with significant barriers to entry that require technical operating expertise.
|
•
|
We own and operate a leading manufacturer of a broad range of high quality graphite electrodes.
|
•
|
We own a water distribution, collection and treatment business which operates through long-term concessions and public-private partnerships, and services 15 million customers in Brazil.
|
•
|
Our mining activities include interests in specialty metal and aggregates mining operations in Canada, including a palladium mine in northern Ontario with approximately 15,000 tonnes per day palladium production.
|
•
|
We own and operate a natural gas exploration and production business, and a contract drilling and well servicing business in western Canada.
|
•
|
Our residential development businesses operate predominantly in North America and Brazil.
|
•
|
Our North American business is conducted through Brookfield Residential Properties Inc., is active in 12 principal markets in Canada and the U.S. and controls over 88,000 lots.
|
•
|
Our Brazilian business includes construction, sales and marketing of a broad range of residential and commercial office units, with a primary focus on middle income residential units in Brazil’s largest markets of São Paulo and Rio de Janeiro.
|
•
|
Our corporate activities consist of allocating capital to our operating business groups, principally through our listed partnerships (BPY, BEP, BIP and BBU) and directly held investments. We also support the development of new private fund products and can support transactions initiated by our subsidiaries. We fund this capital from free cash flow generation and the issuance of corporate borrowings and preferred shares.
|
•
|
We also hold cash and financial assets as part of our liquidity management operations and enter into financial contracts to manage our foreign currency and interest rate risks.
|
i)
|
The Corporation:
|
•
|
Strong levels of liquidity are maintained to support growth and ongoing operations.
|
•
|
Capitalization consists of a large common equity base, supplemented with perpetual preferred shares, long-dated corporate bonds and, from time to time, draws on our corporate credit facilities.
|
•
|
Negligible guarantees are provided on the financial obligations of listed partnerships and managed funds.
|
•
|
High levels of cash flows are available after common share dividends.
|
ii)
|
Our listed partnerships (BPY, BEP, BIP and BBU):
|
•
|
Strong levels of liquidity are maintained at each of the listed partnerships to support their growth and ongoing operations.
|
•
|
Listed partnerships are intended to be self-funding with stable capitalization through market cycles.
|
•
|
Financial obligations have no recourse to the Corporation.
|
iii)
|
Managed funds, or operating asset level in directly held investments:
|
•
|
Each underlying investment is typically funded on a standalone basis.
|
•
|
Fund level borrowings are generally limited to subscription facilities which are backed by the capital commitments to the fund.
|
•
|
Financial obligations have no recourse to the Corporation.
|
•
|
Maintain significant liquidity at the corporate level, primarily in the form of cash, financial assets and undrawn credit lines. Ensure our listed partnerships can finance their operations on a standalone basis without recourse to or reliance on the Corporation.
|
•
|
Structure our borrowings and other financial obligations to provide a stable capitalization at levels that are attractive to investors, are sustainable on a long-term basis and can withstand business cycles.
|
•
|
The vast majority of this debt is at investment-grade levels, however, periodically, we may borrow at sub-investment grade levels in certain parts of our business where the borrowings are carefully structured and monitored.
|
•
|
Provide recourse only to the specific businesses or assets being financed, without cross-collateralization or parental guarantees.
|
•
|
Match the duration of our debt to the underlying leases or contracts and match the currency of our debt to that of the assets such that our remaining exposure is on the net equity of the investment.
|
Focus on Risk Culture
Maintain an effective risk culture that aligns our business strategy and activities with our risk appetite
|
Shared Execution
Business and functional groups are primarily responsible for identifying and managing risks within their business
|
Oversight & Coordination
Consistent approach and practices across business and functional groups, with coordinated management of common risks
|
Name, Municipality of Residence
|
Director Since
|
Principal Occupation
|
M. ELYSE ALLAN
(1) (2) (5)
Toronto, Ontario, Canada
|
2015
|
Former President and Chief Executive Officer, General Electric Canada Company Inc. and former Vice-President, General Electric Co., a global digital industrial company
|
JEFFREY M. BLIDNER
Toronto, Ontario, Canada |
2013
|
Vice Chair, Brookfield Asset Management Inc.
|
ANGELA F. BRALY
(1) (2)
Indianapolis, Indiana, U.S.A. |
2015
|
Former Chair, President and Chief Executive Officer of WellPoint Inc. (now known as Anthem Inc.), a health benefits company
|
JACK L. COCKWELL
Toronto, Ontario, Canada |
1979
|
Corporate Director
|
MARCEL R. COUTU
(1) (2) (4)
Calgary, Alberta, Canada |
2006
|
Former President and Chief Executive Officer, Canadian Oil Sands Limited, the largest investor in the Syncrude Joint Venture
|
MURILO FERREIRA
(1) (5)
Rio de Janeiro, Brazil |
2017
|
Former Chief Executive Officer of Vale SA, a Brazilian multinational corporation engaged in metals and mining
|
J. BRUCE FLATT
London, U.K.
New York, New York, U.S.A.
Toronto, Ontario, Canada
|
2001
|
Chief Executive Officer, Brookfield Asset Management Inc.
|
ROBERT J. HARDING
Toronto, Ontario, Canada |
1992
|
Former Chair, Brookfield Asset Management Inc.
|
MAUREEN KEMPSTON DARKES
(1) (4) (5)
Lauderdale-by-the-Sea, Florida, U.S.A.
Toronto, Ontario, Canada
|
2008
|
Corporate Director and former President, Latin America, Africa and Middle East, General Motors Corporation, a motor vehicle manufacturer
|
BRIAN D. LAWSON
Toronto, Ontario, Canada |
2018
|
Chief Financial Officer, Brookfield Asset Management Inc.
|
THE HON. FRANK J. MCKENNA
(1) (3)
Cap-Pelé, New Brunswick, Canada
Toronto, Ontario, Canada
|
2006
|
Chair, Brookfield Asset Management Inc. and Deputy Chair, TD Bank Group, a financial institution
|
RAFAEL MIRANDA
(1) (2)
Madrid, Spain |
2017
|
Corporate Director and former Chief Executive Officer of Endesa, S.A., the largest electric utility company in Spain
|
YOUSSEF A. NASR
(1) (5)
Beirut, Lebanon |
2010
|
Corporate Director and former Chair and Chief Executive Officer of HSBC Middle East Ltd. and former President of HSBC Bank Brazil, a financial institution
|
LORD O’DONNELL
London, U.K.
|
2013
|
Chair of Frontier Economics, a microeconomics consultancy, and a senior advisor to Brookfield in Europe
|
SEEK NGEE HUAT
(1) (3)
Singapore
|
2012
|
Former Chair of the Latin American Business Group, Government of Singapore Investment Corporation, a sovereign wealth fund
|
DIANA L. TAYLOR
(1) (3) (4)
New York, New York, U.S.A. |
2012
|
Former Vice Chair, Solera Capital LLC, a mid-market private equity firm
|
(1)
Independent Director
(2)
Member of the Audit Committee
(3)
Member of the Governance and Nominating Committee
(4)
Member of the Management Resources and Compensation Committee
(5)
Member of the Risk Management Committee
|
Name
|
Residence
|
Current Office
|
Date of Appointment
|
J. BRUCE FLATT
|
London, U.K.
New York, New York, U.S.A. Toronto, Ontario, Canada
|
Managing Partner and
Chief Executive Officer
|
2002
|
BRIAN W. KINGSTON
|
New York, New York, U.S.A.
|
Managing Partner
|
2007
|
BRIAN D. LAWSON
|
Toronto, Ontario, Canada
|
Managing Partner and
Chief Financial Officer
|
2002
|
CYRUS MADON
|
Toronto, Ontario, Canada
|
Managing Partner
|
2005
|
LORI PEARSON
|
Toronto, Ontario, Canada
|
Managing Partner and
Chief Operating Officer
|
2016
|
SAMUEL J.B. POLLOCK
|
Toronto, Ontario, Canada
|
Managing Partner
|
2003
|
SACHIN G. SHAH
|
Toronto, Ontario, Canada
|
Managing Partner
|
2014
|
JUSTIN B. BEBER
|
Toronto, Ontario, Canada
|
Managing Partner, Head of Corporate Strategy and Chief Legal Officer
|
2018
|
Security
|
Symbol
|
Stock Exchange
|
Class A Shares
|
BAM
|
New York
|
|
BAM.A
|
Toronto
|
|
BAMA
|
Euronext
|
Class A Preference Shares
|
|
|
Series 2
|
BAM.PR.B
|
Toronto
|
Series 4
|
BAM.PR.C
|
Toronto
|
Series 8
|
BAM.PR.E
|
Toronto
|
Series 9
|
BAM.PR.G
|
Toronto
|
Series 13
|
BAM.PR.K
|
Toronto
|
Series 17
|
BAM.PR.M
|
Toronto
|
Series 18
|
BAM.PR.N
|
Toronto
|
Series 24
|
BAM.PR.R
|
Toronto
|
Series 25
|
BAM.PR.S
|
Toronto
|
Series 26
|
BAM.PR.T
|
Toronto
|
Series 28
|
BAM.PR.X
|
Toronto
|
Series 30
|
BAM.PR.Z
|
Toronto
|
Series 32
|
BAM.PF.A
|
Toronto
|
Series 34
|
BAM.PF.B
|
Toronto
|
Series 36
|
BAM.PF.C
|
Toronto
|
Series 37
|
BAM.PF.D
|
Toronto
|
Series 38
|
BAM.PF.E
|
Toronto
|
Series 40
|
BAM.PF.F
|
Toronto
|
Series 42
|
BAM.PF.G
|
Toronto
|
Series 44
|
BAM.PF.H
|
Toronto
|
Series 46
|
BAM.PF.I
|
Toronto
|
Series 48
|
BAM.PF.J
|
Toronto
|
|
DBRS
|
Standard & Poor’s
|
Moody’s
|
Commercial paper
|
R-1 (low)
|
A-2
1
|
P-2
|
Senior notes and debentures
|
A (low)
|
A-
|
Baa2
|
Preferred shares
|
Pfd-2 (low)
|
BBB
2
|
Not rated
|
Outlook
|
Stable
|
Stable
|
Stable
|
1
|
The Corporation’s commercial paper is rated A-1 (low) based on S&P’s Canadian National Scale, which corresponds to a rating of A-2 using S&P’s global scale.
|
2
|
The Corporation’s preferred shares are rated P-2 based on S&P’s Canadian National Scale, which corresponds to a rating of BBB using S&P’s global scale.
|
|
Distribution per Security
|
|||||
|
2018
|
|
2017
|
|
2016
|
|
Per Class A Share and Class B Share
|
|
|
|
|||
Regular
|
$ 0.60
|
|
$ 0.56
|
|
$ 0.52
|
|
Special distribution
(a)
|
—
|
|
0.11
|
|
0.45
|
|
Per Class A Preference Share
(b)
|
|
|
|
|||
Series 2
|
0.48
|
|
0.39
|
|
0.36
|
|
Series 4
|
0.48
|
|
0.39
|
|
0.36
|
|
Series 8
|
0.68
|
|
0.55
|
|
0.48
|
|
Series 9
|
0.53
|
|
0.53
|
|
0.75
|
|
Series 13
|
0.48
|
|
0.39
|
|
0.36
|
|
Series 15
|
0.40
|
|
0.28
|
|
0.23
|
|
Series 17
|
0.92
|
|
0.92
|
|
0.90
|
|
Series 18
|
0.92
|
|
0.92
|
|
0.90
|
|
Series 24
|
0.58
|
|
0.58
|
|
0.80
|
|
Series 25
(c)
|
0.68
|
|
0.56
|
|
0.27
|
|
Series 26
|
0.67
|
|
0.72
|
|
0.85
|
|
Series 28
|
0.53
|
|
0.70
|
|
0.87
|
|
Series 30
|
0.90
|
|
0.93
|
|
0.90
|
|
Series 32
|
0.89
|
|
0.87
|
|
0.85
|
|
Series 34
|
0.81
|
|
0.81
|
|
0.80
|
|
Series 36
|
0.94
|
|
0.94
|
|
0.92
|
|
Series 37
|
0.95
|
|
0.95
|
|
0.92
|
|
Series 38
|
0.85
|
|
0.85
|
|
0.83
|
|
Series 40
|
0.87
|
|
0.87
|
|
0.85
|
|
Series 42
|
0.87
|
|
0.87
|
|
0.85
|
|
Series 44
|
0.96
|
|
0.97
|
|
0.94
|
|
Series 46
(d)
|
0.93
|
|
1.03
|
|
—
|
|
Series 48
(e)
|
0.92
|
|
0.28
|
|
—
|
|
a)
|
an unlimited number of preference shares designated as Class A Preference Shares, issuable in series:
|
•
|
the second series, which consists of 10,457,685 Class A Preference Shares, Series 2;
|
•
|
the fourth series, which consists of 3,995,910 Class A Preference Shares, Series 4;
|
•
|
the sixth series, which consists of 111,633 Class A Preference Shares, Series 6;
|
•
|
the eighth series, which consists of 7,996,600 Class A Preference Shares, Series 8;
|
•
|
the ninth series, which consists of 7,995,566 Class A Preference Shares, Series 9;
|
•
|
the thirteenth series, which consists of 9,640,096 Class A Preference Shares, Series 13;
|
•
|
the fifteenth series, which consists of 2,000,000 Class A Preference Shares, Series 15;
|
•
|
the seventeenth series, which consists of 7,862,084 Class A Preference Shares, Series 17;
|
•
|
the eighteenth series, which consists of 9,085,754 Class A Preference Shares, Series 18;
|
•
|
the twenty-fourth series, which consists of 10,831,281 Class A Preference Shares, Series 24;
|
•
|
the twenty-fifth series, which consists of 10,996,000 Class A Preference Shares, Series 25;
|
•
|
the twenty-sixth series, which consists of 9,803,240 Class A Preference Shares, Series 26;
|
•
|
the twenty-seventh series, which consists of 10,000,000 Class A Preference Shares, Series 27;
|
•
|
the twenty-eighth series, which consists of 9,736,777 Class A Preference Shares, Series 28;
|
•
|
the twenty-ninth series, which consists of 9,890,000 Class A Preference Shares, Series 29;
|
•
|
the thirtieth series, which consists of 9,790,374 Class A Preference Shares, Series 30;
|
•
|
the thirty-first series, which consists of 10,000,000 Class A Preference Shares, Series 31;
|
•
|
the thirty-second series, which consists of 11,754,099 Class A Preference Shares, Series 32;
|
•
|
the thirty-third series, which consists of 12,000,000 Class A Preference Shares, Series 33;
|
•
|
the thirty-fourth series, which consists of 9,888,332 Class A Preference Shares, Series 34;
|
•
|
the thirty-fifth series, which consists of 10,000,000 Class A Preference Shares, Series 35;
|
•
|
the thirty-sixth series, which consists of 7,863,793 Class A Preference Shares, Series 36;
|
•
|
the thirty-seventh series, which consists of 7,837,967 Class A Preference Shares, Series 37;
|
•
|
the thirty-eighth series, which consists of 7,924,280 Class A Preference Shares, Series 38;
|
•
|
the thirty-ninth series, which consists of 8,000,000 Class A Preference Shares, Series 39;
|
•
|
the fortieth series, which consists of 11,853,135 Class A Preference Shares, Series 40;
|
•
|
the forty-first series, which consists of 12,000,000 Class A Preference Shares, Series 41;
|
•
|
the forty-second series, which consists of 11,902,700 Class A Preference Shares, Series 42;
|
•
|
the forty-third series, which consists of 12,000,000 Class A Preference Shares, Series 43;
|
•
|
the forty-fourth series, which consists of 9,831,929 Class A Preference Shares, Series 44;
|
•
|
the forty-fifth series, which consists of 10,000,000 Class A Preference Shares, Series 45;
|
•
|
the forty-sixth series, which consists of 11,740,797 Class A Preference Shares, Series 46;
|
•
|
the forty-seventh series, which consists of 12,000,000 Class A Preference Shares, Series 47;
|
•
|
the forty-eighth series, which consists of 11,885,972 Class A Preference Shares, Series 48; and
|
•
|
the forty-ninth series, which consists of 12,000,000 Class A Preference Shares, Series 49;
|
b)
|
an unlimited number of preference shares designated as Class AA Preference Shares, issuable in series, of which no series have been created or issued;
|
c)
|
an unlimited number of Class A Shares; and
|
d)
|
85,120 Class B Shares.
|
•
|
The Trust Agreement referred to under “Principal Holders of Voting Shares” on pages 4 to 5 of the Corporation’s 2018 Circular, which pages are incorporated by reference in this Annual Information Form; and
|
•
|
The Oaktree Merger Agreement referred to under “Development of the Business - Asset Management - 2019 - Activity to date” section of this Annual Information Form. Under the terms of the Oaktree Merger Agreement, the Corporation will acquire all of the Oaktree Class A Units (other than unvested Oaktree Class A Units) for a per unit consideration of, at the election of the unitholder, either $49.00 in cash or 1.0770 Class A Shares (the “Merger Consideration”). In addition, certain institutional limited partners of Oaktree Capital Group Holdings, L.P. (“OCGH”) will exchange 100% of their limited partnerships units in OCGH for the Merger Consideration and Oaktree’s founders, senior management, and certain current employees (the “OCGH Unitholders”) will exchange 20% of their limited partnership units of OCGH for the Merger Consideration. Elections will be made on a per unit basis and will be subject to pro-ration such that the $4.7 billion consideration paid by the Corporation consists of 50% in cash and 50% in Class A Shares. Upon completion of the transaction, the Corporation will own approximately 62% of the Oaktree business, and the OCGH Unitholders will own the remaining 38%. The Oaktree Merger Agreement contains customary representations, warranties, and covenants by Oaktree and the Corporation, as well as certain conditions to closing, including obtaining certain government and regulatory approvals, and the execution of the Third Amended and Restated Exchange Agreement (the “Exchange Agreement”). The Exchange Agreement provides, among other things, that commencing in 2022, the OCGH Unitholders will have the ability to sell to the Corporation their vested units in OCGH overtime pursuant to an agreed upon liquidity schedule and approach to valuing such units at the time of liquidation. Pursuant to this liquidity schedule, the earliest year in which the Corporation could own 100% of Oaktree is 2029.
|
|
Class A Limited Voting Shares (TSX: BAM.A)
|
|
Class A Limited Voting Shares (NYSE: BAM)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(US$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
(a)
|
|
|
High
|
Low
|
Average
|
Volume
Traded
(b)
|
|
January
|
54.79
|
50.28
|
52.95
|
19,759,341
|
|
|
44.06
|
40.77
|
42.60
|
25,603,487
|
|
February
|
51.73
|
46.71
|
49.84
|
28,846,673
|
|
|
42.01
|
37.22
|
39.59
|
32,410,891
|
|
March
|
52.83
|
48.94
|
50.97
|
22,218,884
|
|
|
40.50
|
38.03
|
39.43
|
24,031,831
|
|
April
|
51.25
|
48.91
|
49.60
|
16,548,278
|
|
|
39.96
|
38.09
|
38.97
|
21,712,648
|
|
May
|
52.94
|
50.12
|
51.69
|
21,094,870
|
|
|
41.20
|
38.88
|
40.17
|
15,956,901
|
|
June
|
55.52
|
51.74
|
53.68
|
20,613,466
|
|
|
43.20
|
39.76
|
40.87
|
14,973,183
|
|
July
|
55.80
|
52.25
|
54.65
|
16,079,964
|
|
|
42.39
|
39.99
|
41.65
|
11,874,512
|
|
August
|
57.77
|
53.79
|
56.10
|
16,398,769
|
|
|
44.26
|
41.28
|
42.98
|
20,432,539
|
|
September
|
58.67
|
54.50
|
56.23
|
17,801,863
|
|
|
44.93
|
41.90
|
43.15
|
17,745,113
|
|
October
|
57.67
|
51.90
|
54.78
|
22,735,646
|
|
|
45.04
|
39.57
|
42.15
|
27,874,292
|
|
November
|
59.15
|
53.51
|
56.81
|
24,635,026
|
|
|
44.54
|
40.92
|
43.02
|
23,901,066
|
|
December
|
58.57
|
49.87
|
54.28
|
25,159,095
|
|
|
44.38
|
36.58
|
40.13
|
28,954,658
|
|
|
Class A Preference Shares, Series 2
(TSX: BAM.PR.B)
|
|
Class A Preference Shares, Series 4
(TSX: BAM.PR.C)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
17.35
|
15.03
|
16.67
|
161,257
|
|
|
17.22
|
15.10
|
15.86
|
130,854
|
|
February
|
17.83
|
16.74
|
17.22
|
128,234
|
|
|
17.75
|
16.70
|
16.23
|
182,489
|
|
March
|
18.41
|
16.95
|
17.64
|
174,848
|
|
|
18.01
|
17.00
|
15.13
|
68,529
|
|
April
|
17.48
|
16.37
|
16.95
|
130,625
|
|
|
17.47
|
16.38
|
14.58
|
22,392
|
|
May
|
17.21
|
16.51
|
16.93
|
62,224
|
|
|
17.37
|
16.59
|
13.86
|
27,079
|
|
June
|
17.29
|
16.68
|
17.02
|
108,012
|
|
|
17.24
|
16.73
|
15.39
|
35,664
|
|
July
|
18.09
|
16.82
|
17.58
|
138,050
|
|
|
18.11
|
16.83
|
15.89
|
73,064
|
|
August
|
18.00
|
17.51
|
16.96
|
79,902
|
|
|
17.99
|
17.60
|
16.13
|
31,032
|
|
September
|
17.87
|
17.20
|
17.62
|
142,333
|
|
|
17.86
|
17.22
|
14.83
|
35,515
|
|
October
|
18.69
|
16.92
|
17.82
|
198,145
|
|
|
18.60
|
17.00
|
17.81
|
127,828
|
|
November
|
17.82
|
14.45
|
16.51
|
113,735
|
|
|
17.83
|
14.47
|
15.71
|
54,177
|
|
December
|
14.87
|
12.41
|
13.61
|
181,205
|
|
|
14.92
|
12.34
|
12.21
|
60,125
|
|
|
Class A Preference Shares, Series 8
(TSX: BAM.PR.E)
|
|
Class A Preference Shares, Series 9
(TSX: BAM.PR.G)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
21.99
|
20.30
|
17.49
|
29,153
|
|
|
19.20
|
18.07
|
14.25
|
29,015
|
|
February
|
22.49
|
21.45
|
10.32
|
9,048
|
|
|
19.16
|
18.66
|
9.93
|
19,840
|
|
March
|
22.49
|
21.28
|
10.34
|
9,142
|
|
|
18.94
|
18.5
|
8.00
|
7,405
|
|
April
|
22.01
|
21.18
|
13.36
|
14,116
|
|
|
18.68
|
18.09
|
12.26
|
318,270
|
|
May
|
21.74
|
21.10
|
11.68
|
16,049
|
|
|
19.00
|
18.21
|
9.26
|
15,500
|
|
June
|
21.75
|
21.26
|
8.17
|
27,000
|
|
|
19.10
|
18.4
|
11.62
|
129,189
|
|
July
|
22.45
|
21.30
|
12.46
|
19,665
|
|
|
19.60
|
19.14
|
11.00
|
43,356
|
|
August
|
22.45
|
21.50
|
14.88
|
43,541
|
|
|
19.88
|
19.26
|
10.60
|
15,200
|
|
September
|
22.75
|
22.02
|
17.67
|
12,723
|
|
|
20.40
|
19.80
|
10.54
|
8,787
|
|
October
|
23.20
|
22.50
|
10.42
|
38,725
|
|
|
21.00
|
19.85
|
15.99
|
61,772
|
|
November
|
23.30
|
21.35
|
16.54
|
49,925
|
|
|
20.45
|
18.86
|
13.51
|
221,049
|
|
December
|
20.72
|
17.84
|
15.26
|
47,626
|
|
|
19.53
|
16.75
|
12.54
|
20,885
|
|
|
Class A Preference Shares, Series 13
(TSX: BAM.PR.K)
|
|
Class A Preference Shares, Series 17
(TSX: BAM.PR.M)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
17.42
|
15.10
|
16.67
|
256,257
|
|
|
22.27
|
21.62
|
21.94
|
72,563
|
|
February
|
17.75
|
16.66
|
17.20
|
261,174
|
|
|
22.22
|
21.15
|
21.57
|
102,282
|
|
March
|
18.06
|
16.73
|
17.63
|
221,318
|
|
|
21.83
|
20.73
|
20.29
|
187,983
|
|
April
|
17.30
|
16.28
|
16.94
|
110,924
|
|
|
21.19
|
20.67
|
19.89
|
133,237
|
|
May
|
17.24
|
16.48
|
15.34
|
90,342
|
|
|
21.01
|
20.76
|
20.87
|
60,377
|
|
June
|
17.24
|
16.76
|
17.02
|
83,371
|
|
|
21.33
|
20.80
|
20.09
|
70,719
|
|
July
|
18.03
|
16.80
|
17.55
|
183,388
|
|
|
21.22
|
20.90
|
21.04
|
61,489
|
|
August
|
17.98
|
17.55
|
16.97
|
64,014
|
|
|
21.31
|
20.84
|
20.05
|
64,563
|
|
September
|
17.88
|
17.24
|
15.80
|
44,852
|
|
|
21.23
|
20.67
|
19.83
|
52,757
|
|
October
|
18.68
|
17.06
|
17.82
|
150,659
|
|
|
21.03
|
19.61
|
20.42
|
162,369
|
|
November
|
17.84
|
14.52
|
16.46
|
112,331
|
|
|
20.54
|
19.18
|
19.94
|
78,698
|
|
December
|
15.14
|
12.30
|
12.89
|
98,698
|
|
|
20.38
|
18.70
|
19.39
|
171,419
|
|
|
Class A Preference Shares, Series 18
(TSX: BAM.PR.N)
|
|
Class A Preference Shares, Series 24
(TSX: BAM.PR.R)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
22.20
|
21.46
|
20.80
|
122,110
|
|
|
21.46
|
20.08
|
20.71
|
115,867
|
|
February
|
21.97
|
20.97
|
20.32
|
105,309
|
|
|
21.42
|
20.65
|
21.05
|
54,545
|
|
March
|
21.79
|
20.69
|
21.25
|
171,077
|
|
|
21.35
|
19.99
|
19.79
|
90,525
|
|
April
|
21.11
|
20.60
|
19.84
|
79,051
|
|
|
20.26
|
19.79
|
19.06
|
132,162
|
|
May
|
21.01
|
20.72
|
20.87
|
58,875
|
|
|
21.19
|
20.05
|
20.64
|
278,575
|
|
June
|
21.35
|
20.75
|
21.10
|
57,774
|
|
|
20.79
|
20.33
|
20.53
|
54,810
|
|
July
|
21.20
|
20.87
|
21.02
|
81,760
|
|
|
21.11
|
20.29
|
20.77
|
68,387
|
|
August
|
21.33
|
20.80
|
20.99
|
119,115
|
|
|
21.49
|
20.97
|
20.19
|
52,774
|
|
September
|
21.23
|
20.63
|
19.84
|
75,202
|
|
|
21.52
|
20.89
|
21.19
|
159,914
|
|
October
|
21.00
|
19.54
|
20.39
|
234,576
|
|
|
21.52
|
19.49
|
21.00
|
192,630
|
|
November
|
20.52
|
19.09
|
19.91
|
88,991
|
|
|
20.62
|
17.20
|
19.02
|
396,991
|
|
December
|
20.25
|
18.55
|
19.31
|
187,045
|
|
|
18.10
|
15.84
|
16.76
|
430,970
|
|
|
Class A Preference Shares, Series 25
(TSX: BAM.PR.S)
|
|
Class A Preference Shares, Series 26
(TSX: BAM.PR.T)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
21.25
|
20.25
|
10.46
|
11,424
|
|
|
21.98
|
20.66
|
21.28
|
182,650
|
|
February
|
22.51
|
20.62
|
17.29
|
25,843
|
|
|
22.00
|
21.03
|
21.48
|
78,431
|
|
March
|
22.63
|
20.40
|
11.27
|
12,807
|
|
|
21.83
|
20.51
|
19.21
|
65,894
|
|
April
|
20.26
|
19.80
|
14.31
|
16,449
|
|
|
20.81
|
20.25
|
20.43
|
121,127
|
|
May
|
20.92
|
20.20
|
12.13
|
33,140
|
|
|
21.34
|
20.49
|
20.94
|
98,524
|
|
June
|
20.75
|
20.44
|
10.73
|
25,470
|
|
|
21.04
|
20.45
|
19.73
|
46,931
|
|
July
|
21.50
|
20.34
|
10.96
|
9,837
|
|
|
21.26
|
20.49
|
20.95
|
381,490
|
|
August
|
21.69
|
21.10
|
12.61
|
7,665
|
|
|
21.69
|
21.08
|
21.32
|
146,034
|
|
September
|
21.95
|
21.10
|
13.55
|
12,625
|
|
|
21.68
|
21.06
|
21.31
|
117,682
|
|
October
|
21.73
|
19.60
|
10.60
|
15,825
|
|
|
21.56
|
19.50
|
21.02
|
239,717
|
|
November
|
21.73
|
17.68
|
14.94
|
26,026
|
|
|
20.62
|
17.23
|
19.12
|
148,939
|
|
December
|
18.06
|
15.30
|
14.18
|
57,000
|
|
|
18.03
|
15.80
|
16.85
|
258,418
|
|
|
Class A Preference Shares, Series 28
(TSX: BAM.PR.X)
|
|
Class A Preference Shares, Series 30
(TSX: BAM.PR.Z)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
18.66
|
17.39
|
18.15
|
337,181
|
|
|
25.10
|
23.87
|
24.80
|
230,417
|
|
February
|
18.61
|
18.00
|
18.33
|
95,814
|
|
|
24.99
|
24.41
|
24.76
|
388,279
|
|
March
|
18.70
|
17.66
|
18.27
|
224,443
|
|
|
24.92
|
24.27
|
23.46
|
142,211
|
|
April
|
18.21
|
17.65
|
17.07
|
292,052
|
|
|
24.62
|
24.05
|
24.37
|
196,921
|
|
May
|
18.90
|
18.01
|
18.56
|
72,391
|
|
|
25.02
|
24.42
|
24.87
|
154,519
|
|
June
|
18.87
|
17.99
|
18.47
|
85,985
|
|
|
25.04
|
24.60
|
24.77
|
117,568
|
|
July
|
19.00
|
18.18
|
18.74
|
84,394
|
|
|
24.95
|
24.60
|
24.82
|
92,689
|
|
August
|
19.63
|
19.00
|
18.36
|
75,454
|
|
|
25.15
|
24.74
|
23.78
|
281,001
|
|
September
|
19.61
|
19.01
|
19.23
|
68,670
|
|
|
25.15
|
24.44
|
24.76
|
97,196
|
|
October
|
19.49
|
17.27
|
18.92
|
325,112
|
|
|
24.75
|
22.90
|
24.36
|
138,402
|
|
November
|
18.56
|
15.60
|
17.30
|
127,925
|
|
|
24.05
|
20.34
|
21.32
|
100,450
|
|
December
|
16.30
|
14.43
|
15.46
|
201,755
|
|
|
22.09
|
19.43
|
20.47
|
324,411
|
|
|
Class A Preference Shares, Series 32
(TSX: BAM.PF.A)
|
|
Class A Preference Shares, Series 34
(TSX: BAM.PF.B)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
25.06
|
24.61
|
24.85
|
389,162
|
|
|
24.60
|
23.82
|
24.26
|
186,689
|
|
February
|
25.10
|
24.43
|
24.71
|
534,246
|
|
|
24.49
|
23.65
|
24.05
|
138,446
|
|
March
|
24.83
|
23.82
|
24.40
|
284,083
|
|
|
24.18
|
22.99
|
23.67
|
84,428
|
|
April
|
24.36
|
23.73
|
24.01
|
273,850
|
|
|
23.49
|
22.94
|
23.20
|
85,226
|
|
May
|
25.38
|
24.10
|
24.97
|
308,296
|
|
|
24.19
|
23.33
|
23.93
|
569,352
|
|
June
|
25.10
|
24.40
|
24.76
|
143,092
|
|
|
23.99
|
23.14
|
23.57
|
153,585
|
|
July
|
24.96
|
24.41
|
24.75
|
76,029
|
|
|
24.06
|
23.14
|
23.70
|
117,824
|
|
August
|
25.20
|
24.75
|
24.90
|
117,788
|
|
|
24.37
|
23.85
|
24.04
|
84,854
|
|
September
|
25.22
|
24.62
|
24.87
|
199,280
|
|
|
24.20
|
23.52
|
23.81
|
88,605
|
|
October
|
25.00
|
23.34
|
24.62
|
310,356
|
|
|
24.23
|
22.31
|
23.68
|
207,978
|
|
November
|
24.36
|
21.30
|
23.02
|
149,039
|
|
|
23.21
|
19.98
|
21.79
|
166,147
|
|
December
|
22.67
|
19.51
|
20.99
|
417,830
|
|
|
21.00
|
18.14
|
19.30
|
347,431
|
|
|
Class A Preference Shares, Series 36
(TSX: BAM.PF.C)
|
|
Class A Preference Shares, Series 37
(TSX: BAM.PF.D)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
22.72
|
21.85
|
22.22
|
221,881
|
|
|
23.00
|
22.14
|
18.42
|
74,661
|
|
February
|
22.50
|
21.50
|
21.97
|
88,912
|
|
|
22.80
|
21.80
|
18.73
|
25,310
|
|
March
|
22.33
|
21.17
|
21.75
|
161,399
|
|
|
22.50
|
21.35
|
19.79
|
69,855
|
|
April
|
21.73
|
21.15
|
21.39
|
78,403
|
|
|
21.79
|
21.20
|
20.47
|
274,205
|
|
May
|
21.50
|
21.13
|
20.38
|
101,010
|
|
|
21.82
|
21.28
|
19.54
|
56,362
|
|
June
|
21.83
|
21.28
|
21.60
|
96,565
|
|
|
22.17
|
21.36
|
19.71
|
214,807
|
|
July
|
21.68
|
21.37
|
21.54
|
73,519
|
|
|
21.85
|
21.47
|
18.60
|
181,634
|
|
August
|
21.91
|
21.36
|
21.58
|
68,772
|
|
|
21.96
|
21.55
|
21.67
|
66,117
|
|
September
|
21.84
|
21.07
|
20.31
|
53,268
|
|
|
21.91
|
21.15
|
18.11
|
77,404
|
|
October
|
21.52
|
20.11
|
20.91
|
144,110
|
|
|
21.55
|
20.26
|
20.05
|
228,932
|
|
November
|
21.15
|
19.65
|
20.51
|
86,507
|
|
|
21.25
|
19.81
|
19.74
|
78,184
|
|
December
|
20.70
|
19.16
|
19.73
|
147,884
|
|
|
21.07
|
19.30
|
20.07
|
214,692
|
|
|
Class A Preference Shares, Series 38
(TSX: BAM.PF.E)
|
|
Class A Preference Shares, Series 40
(TSX: BAM.PF.F)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
24.43
|
23.75
|
21.82
|
74,800
|
|
|
25.02
|
24.49
|
24.85
|
182,711
|
|
February
|
24.35
|
23.45
|
23.82
|
56,084
|
|
|
25.01
|
24.39
|
24.76
|
90,805
|
|
March
|
23.93
|
22.69
|
22.33
|
83,283
|
|
|
24.96
|
23.90
|
23.34
|
213,751
|
|
April
|
23.24
|
22.70
|
22.91
|
169,196
|
|
|
24.40
|
24.02
|
24.19
|
425,329
|
|
May
|
24.04
|
22.99
|
23.66
|
67,999
|
|
|
25.22
|
24.15
|
23.69
|
68,428
|
|
June
|
23.70
|
22.86
|
22.22
|
65,522
|
|
|
24.99
|
24.25
|
24.57
|
155,348
|
|
July
|
23.87
|
23.00
|
23.46
|
124,014
|
|
|
25.00
|
24.27
|
24.73
|
88,906
|
|
August
|
24.06
|
23.57
|
21.61
|
50,881
|
|
|
25.18
|
24.87
|
25.00
|
138,609
|
|
September
|
24.10
|
23.50
|
19.95
|
66,146
|
|
|
25.16
|
24.59
|
23.54
|
245,141
|
|
October
|
24.24
|
22.16
|
23.66
|
265,979
|
|
|
25.04
|
23.07
|
24.53
|
337,818
|
|
November
|
23.20
|
19.65
|
21.64
|
109,233
|
|
|
24.15
|
20.58
|
22.57
|
273,411
|
|
December
|
20.45
|
17.15
|
18.55
|
229,792
|
|
|
21.54
|
18.77
|
19.81
|
394,547
|
|
|
Class A Preference Shares, Series 42
(TSX: BAM.PF.G)
|
|
Class A Preference Shares, Series 44
(TSX: BAM.PF.H)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
25.00
|
24.40
|
24.78
|
174,268
|
|
|
26.65
|
26.20
|
25.20
|
187,659
|
|
February
|
24.95
|
24.01
|
24.61
|
169,419
|
|
|
26.35
|
25.75
|
26.09
|
268,084
|
|
March
|
24.79
|
23.63
|
21.95
|
144,365
|
|
|
26.07
|
25.49
|
24.57
|
189,655
|
|
April
|
24.07
|
23.50
|
23.79
|
154,473
|
|
|
25.90
|
25.55
|
25.74
|
78,785
|
|
May
|
24.89
|
23.81
|
24.48
|
65,304
|
|
|
26.32
|
25.70
|
24.77
|
111,721
|
|
June
|
24.57
|
23.91
|
23.04
|
81,057
|
|
|
26.24
|
25.78
|
24.72
|
103,904
|
|
July
|
24.78
|
23.84
|
24.43
|
85,435
|
|
|
26.08
|
25.73
|
25.97
|
120,950
|
|
August
|
25.15
|
24.60
|
23.65
|
66,411
|
|
|
26.15
|
25.91
|
24.88
|
195,639
|
|
September
|
25.03
|
24.56
|
23.47
|
74,266
|
|
|
26.04
|
25.55
|
25.83
|
36,219
|
|
October
|
25.00
|
23.04
|
24.54
|
296,754
|
|
|
25.90
|
25.10
|
25.55
|
174,772
|
|
November
|
24.09
|
20.53
|
22.59
|
132,718
|
|
|
25.76
|
24.99
|
25.45
|
168,801
|
|
December
|
21.40
|
18.75
|
19.77
|
176,223
|
|
|
25.93
|
25.15
|
25.61
|
130,269
|
|
|
Class A Preference Shares, Series 46
(TSX: BAM.PF.I)
|
|
Class A Preference Shares, Series 48
(TSX: BAM.PF.J)
|
||||||||
|
Price Per Share
(C$)
|
|
|
Price Per Share
(C$)
|
|
||||||
Period
2018
|
High
|
Low
|
Average
|
Volume
Traded
|
|
|
High
|
Low
|
Average
|
Volume
Traded
|
|
January
|
26.50
|
25.87
|
26.18
|
158,850
|
|
|
26.25
|
25.25
|
25.56
|
273,612
|
|
February
|
25.99
|
25.30
|
25.84
|
322,526
|
|
|
25.52
|
25.05
|
25.23
|
465,917
|
|
March
|
26.00
|
25.50
|
25.78
|
119,296
|
|
|
25.49
|
24.95
|
25.27
|
369,017
|
|
April
|
26.06
|
25.54
|
24.56
|
194,730
|
|
|
26.23
|
25.15
|
25.49
|
188,404
|
|
May
|
26.31
|
25.90
|
26.05
|
325,474
|
|
|
25.95
|
25.49
|
25.68
|
322,498
|
|
June
|
26.14
|
25.84
|
25.96
|
43,777
|
|
|
25.80
|
25.30
|
25.58
|
152,274
|
|
July
|
26.19
|
25.77
|
22.26
|
86,108
|
|
|
26.05
|
25.56
|
24.48
|
63,515
|
|
August
|
26.33
|
26.06
|
26.18
|
54,122
|
|
|
26.04
|
25.65
|
24.63
|
118,447
|
|
September
|
26.31
|
25.74
|
25.98
|
50,071
|
|
|
26.00
|
25.25
|
25.53
|
104,355
|
|
October
|
26.06
|
24.68
|
25.65
|
377,030
|
|
|
25.73
|
24.56
|
25.24
|
108,897
|
|
November
|
25.75
|
24.02
|
24.92
|
413,285
|
|
|
25.21
|
23.93
|
24.57
|
124,717
|
|
December
|
25.70
|
24.40
|
25.01
|
317,491
|
|
|
24.82
|
23.20
|
24.24
|
248,647
|
|
Series
|
|
Ticker
|
|
Authorized
|
|
Issued and Outstanding
|
|
Aggregate Issuance Amount (C$ millions)
1
|
|
Cumulative Dividend Rate
|
|
Earliest Redemption Date
|
|
Redemption Price Per Share (C$)
2
|
|
Holder’s Conversion Option
|
|
Corporation’s Conversion Option
|
2
|
|
BAM.PR.B
|
|
10,457,685
|
|
10,457,685
|
|
261
|
|
70% of average “Prime Rate” (as defined in the articles)
|
|
At any time
|
|
25.00
|
|
N/A
|
|
N/A
|
4
|
|
BAM.PR.C
|
|
3,995,910
|
|
3,995,910
|
|
100
|
|
70% of average “Prime Rate” (as defined in the articles)
|
|
At any time
|
|
25.00
|
|
N/A
|
|
N/A
|
6
|
|
N/A
|
|
111,633
|
|
nil
|
|
nil
|
|
7.5%
|
|
At any time
|
|
25.00
|
|
N/A
|
|
N/A
|
8
|
|
BAM.PR.E
|
|
7,996,600
|
|
2,476,185
|
|
62
|
|
Between 50-100% of “Prime Rate” (as defined in the articles)
|
|
At any time
|
|
25.50
|
|
Into Series 9 on a one-for-one basis on November 1 in every fifth year after November 1, 2001 and automatically in certain circumstances
|
|
N/A
|
9
|
|
BAM.PR.G
|
|
7,995,566
|
|
5,515,981
|
|
138
|
|
Not less than 80% of yield on certain Government of Canada bonds (as provided in the articles)
|
|
On November 1 in every fifth year after November 1, 2006
|
|
25.00
|
|
Into Series 8 on a one-for-one basis on November 1 in every fifth year after November 1, 2006 and automatically in certain circumstances
|
|
N/A
|
13
|
|
BAM.PR.K
|
|
9,640,096
|
|
9,640,096
|
|
241
|
|
70% of “Average Prime Rate” (as defined in the articles)
|
|
At any time
|
|
25.00
|
|
N/A
|
|
N/A
|
15
|
|
N/A
|
|
2,000,000
|
|
2,000,000
|
|
50
|
|
Determined by negotiation, bid or auction, or the Bankers’ Acceptable Rate (as defined in the articles) plus 0.40%
|
|
At any time
|
|
25.00
|
|
N/A
|
|
N/A
|
17
|
|
BAM.PR.M
|
|
7,862,084
|
|
7,862,084
|
|
197
|
|
4.75%
|
|
At any time
|
|
25.00
|
|
N/A
|
|
At any time into a number of Class A Shares per share based on dividing the redemption price by the Conversion Price
3
|
18
|
|
BAM.PR.N
|
|
9,085,754
|
|
7,885,754
|
|
197
|
|
4.75%
|
|
At any time
|
|
25.00
|
|
N/A
|
|
At any time into a number of Class A Shares per share based on dividing the redemption price by the Conversion Price
|
24
|
|
BAM.PR.R
|
|
10,831,281
|
|
9,298,148
|
|
232
|
|
5.4% until June 30, 2016; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the Government of Canada yield plus 2.30%
|
|
On June 30 in every fifth year after June 30, 2016
|
|
25.00
|
|
Into Series 25 on a one-for-one basis on June 30, 2016 and on June 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
Notes:
1
Rounded to the nearest million.
2
Together with accrued and unpaid dividends.
3
The “Conversion Price” means the greater of C$2.00 or 95% of the weighted average trading price of the Class A Shares on the TSX for the 20 consecutive trading days ending on (i) the fourth day prior to the date specified for conversion, or (ii) if such fourth day is not a trading day, the immediately preceding trading day.
|
Series
|
|
Ticker
|
|
Authorized
|
|
Issued and Outstanding
|
|
Aggregate Issuance Amount (C$ millions)
1
|
|
Cumulative Dividend Rate
|
|
Earliest Redemption Date
|
|
Redemption Price Per Share (C$)
2
|
|
Holder’s Conversion Option
|
|
Corporation’s Conversion Option
|
25
|
|
BAM.PR.S
|
|
10,996,000
|
|
1,529,133
|
|
38
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.30%
|
|
June 30, 2016
|
|
25.00 for redemptions on June 30, 2021 and on June 30 every five years thereafter; 25.50 otherwise
|
|
Into Series 24 on a one-for-one basis on June 30, 2021 and on June 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
26
|
|
BAM.PR.T
|
|
9,803,240
|
|
9,803,240
|
|
245
|
|
4.5% until March 31, 2017; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the Government of Canada yield plus 2.31%
|
|
On March 31 in every fifth year after March 31, 2017
|
|
25.00
|
|
Into Series 27 on a one-for-one basis on March 31, 2017 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
27
|
|
N/A
|
|
10,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.31%
|
|
March 31, 2017
|
|
25.00 for redemptions on March 31, 2022 and on March 31 every five years thereafter; 25.50 otherwise
|
|
Into Series 26 on a one-for-one basis on March 31, 2022 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
28
|
|
BAM.PR.X
|
|
9,736,777
|
|
9,246,777
|
|
231
|
|
4.6% until June 30, 2017; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the 5-year Government of Canada bond yield plus 1.80%
|
|
On June 30 in every fifth year after June 30, 2017
|
|
25.00
|
|
Into Series 29 on a one-for-one basis on June 30, 2017 and on June 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
29
|
|
N/A
|
|
9,890,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 1.80%
|
|
June 30, 2017
|
|
25.00 for redemptions on June 30, 2022 and on June 30 every five years thereafter; 25.50 otherwise
|
|
Into Series 28 on a one-for-one basis on June 30, 2022 and on June 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
30
|
|
BAM.PR.Z
|
|
9,790,374
|
|
9,790,374
|
|
245
|
|
4.8% until December 31, 2017; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the 5-year Government of Canada bond yield plus 2.96%
|
|
On December 31 in every fifth year after December 31, 2017
|
|
25.00
|
|
Into Series 31 on a one-for-one basis on December 31, 2017 and on December 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
31
|
|
N/A
|
|
10,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.96%
|
|
December 31, 2017
|
|
25.00 for redemptions on December 31, 2022 and on December 31 every five years thereafter; 25.50 otherwise
|
|
Into Series 30 on a one-for-one basis on December 31, 2022 and on December 31 every five years thereafter and automatically in certain circumstance
|
|
N/A
|
Notes:
1
Rounded to the nearest million.
2
Together with accrued and unpaid dividends.
|
Series
|
|
Ticker
|
|
Authorized
|
|
Issued and Outstanding
|
|
Aggregate Issuance Amount (C$ millions)
1
|
|
Cumulative Dividend Rate
|
|
Earliest Redemption Date
|
|
Redemption Price Per Share (C$)
2
|
|
Holder’s Conversion Option
|
|
Corporation’s Conversion Option
|
32
|
|
BAM.PF.A
|
|
11,754,099
|
|
11,754,099
|
|
294
|
|
4.5% until September 30, 2018; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the 5-year Government of Canada bond yield plus 2.90%
|
|
On September 30 in every fifth year after September 30, 2018
|
|
25.00
|
|
Into Series 33 on a one-for-one basis on September 30, 2018 and on September 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
33
|
|
N/A
|
|
12,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.90%
|
|
September 30, 2018
|
|
25.00 for redemptions on September 30, 2023 and on September 30 every five years thereafter; 25.50 otherwise
|
|
Into Series 32 on a one-for-one basis on September 30, 2023 and on September 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
34
|
|
BAM.PF.B
|
|
9,888,332
|
|
9,888,332
|
|
247
|
|
4.2% until March 31, 2019; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the 5-year Government of Canada bond yield plus 2.63%
|
|
March 31, 2019 and on March 31 in every fifth year after March 31, 2019
|
|
25.00
|
|
Into Series 35 on a one-for-one basis on March 31, 2019 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
35
|
|
N/A
|
|
10,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.63%
|
|
March 31, 2019
|
|
25.00 for redemptions on March 31, 2024 and on March 31 every five years thereafter; 25.50 otherwise
|
|
Into Series 34 on a one-for-one basis on March 31, 2024 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
36
|
|
BAM.PF.C
|
|
7,863,793
|
|
7,863,793
|
|
197
|
|
4.85%
|
|
March 31, 2018
|
|
26.00 if before March 31, 2019, with annual 0.25 decreases until March 31, 2022; 25.00 thereafter
|
|
N/A
|
|
N/A
|
37
|
|
BAM.PF.D
|
|
7,837,967
|
|
7,837,967
|
|
196
|
|
4.9%
|
|
September 30, 2018
|
|
26.00 if before September 30, 2019, with annual 0.25 decreases until September 30, 2022; 25.00 thereafter
|
|
N/A
|
|
N/A
|
38
|
|
BAM.PF.E
|
|
7,924,280
|
|
7,924,280
|
|
198
|
|
4.4% until March 31, 2020; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the 5-year Government of Canada bond yield plus 2.55%
|
|
March 31, 2020
|
|
25.00
|
|
Into Series 39 on a one-for-one basis on March 31, 2020 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
Notes:
1
Rounded to the nearest million.
2
Together with accrued and unpaid dividends.
|
Series
|
|
Ticker
|
|
Authorized
|
|
Issued and Outstanding
|
|
Aggregate Issuance Amount (C$ millions)
1
|
|
Cumulative Dividend Rate
|
|
Earliest Redemption Date
|
|
Redemption Price Per Share (C$)
2
|
|
Holder’s Conversion Option
|
|
Corporation’s Conversion Option
|
39
|
|
N/A
|
|
8,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.55%
|
|
March 31, 2020
|
|
25.00 for redemptions on March 31, 2025 or March 31 every five years thereafter; 25.50 otherwise
|
|
Into Series 38 on a one-for-one basis on March 31, 2025 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
40
|
|
BAM.PF.F
|
|
11,853,135
|
|
11,853,135
|
|
296
|
|
4.5% until September 30, 2019; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the 5-year Government of Canada bond yield plus 2.86%
|
|
September 19, 2019
|
|
25.00
|
|
Into Series 41 on a one-for one basis on September 30, 2019 and on September 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
41
|
|
N/A
|
|
12,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.86%
|
|
September 30, 2019
|
|
25.00 for redemptions on September 30, 2024 or September 30 every five years thereafter; 25.50 otherwise
|
|
Into Series 40 on a one-for-one basis on September 30, 2024 and on September 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
42
|
|
BAM.PF.G
|
|
11,902,700
|
|
11,902,700
|
|
298
|
|
4.5% until September 30, 2019; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the sum of the 5-year Government of Canada bond yield plus 2.84%
|
|
June 30, 2020
|
|
25.00
|
|
Into Series 43 on a one-for-one basis on June 30, 2020 and on June 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
43
|
|
N/A
|
|
12,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 2.84%
|
|
June 30, 2020
|
|
25.00 for redemptions on June 30, 2025 or June 30 every five years thereafter; 25.50 otherwise
|
|
Into Series 42 on a one-for-one basis on June 30, 2025 and on June 30 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
44
|
|
BAM.PF.H
|
|
9,831,929
|
|
9,831,929
|
|
246
|
|
5% until December 31, 2020; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the greater of (i) the sum of the 5-year Government of Canada bond yield plus 4.17%, and (ii) 5%
|
|
December 31, 2020
|
|
25.00
|
|
Into Series 45 on a one-for-one basis on December 31, 2020 and on December 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
Notes:
1
Rounded to the nearest million.
2
Together with accrued and unpaid dividends.
|
Series
|
|
Ticker
|
|
Authorized
|
|
Issued and Outstanding
|
|
Aggregate Issuance Amount (C$ millions)
1
|
|
Cumulative Dividend Rate
|
|
Earliest Redemption Date
|
|
Redemption Price Per Share (C$)
2
|
|
Holder’s Conversion Option
|
|
Corporation’s Conversion Option
|
45
|
|
N/A
|
|
10,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 4.17%
|
|
December 31, 2020
|
|
25.00 for redemptions on December 31, 2025 and on December 31 every five years thereafter; 25.50 otherwise
|
|
Into Series 44 on a one-for-one basis on December 31, 2025 and on December 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
46
|
|
BAM.PF.I
|
|
11,740,797
|
|
11,740,797
|
|
294
|
|
4.8% until March 31, 2022; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the greater of (i) the sum of the 5-year Government of Canada bond yield plus 3.85%, and (ii) 4.80%
|
|
March 31, 2022
|
|
25.00
|
|
Into Series 47 on a one-for-one basis on March 31, 2022 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
47
|
|
N/A
|
|
12,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 3.85%
|
|
March 31, 2022
|
|
25.00 for redemptions on March 31, 2027 and on March 31 every five years thereafter; 25.50 otherwise
|
|
Into Series 46 on a one-for-one basis on March 31, 2027 and on March 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
48
|
|
BAM.PF.J
|
|
11,885,972
|
|
11,885,972
|
|
297
|
|
4.75% until January1, 2023; thereafter the Annual Fixed Dividend Rate for each 5-year fixed rate period will be the greater of (i) the sum of the 5-year Government of Canada bond yield plus 3.10%, and (ii) 4.75%
|
|
December 31, 2022
|
|
25.00
|
|
Into Series 49 on a one-for-one basis on December 31, 2023 and on December 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
49
|
|
N/A
|
|
12,000,000
|
|
nil
|
|
nil
|
|
An amount equal to the sum of the three-month Government of Canada Treasury Bill Rate plus 3.10%
|
|
December 31, 2022
|
|
25.00 for redemptions on March 31, 2027 and on March 31 every five years thereafter; 25.50 otherwise
|
|
Into Series 48 on a one-for-one basis on December 31, 2027 and on December 31 every five years thereafter and automatically in certain circumstances
|
|
N/A
|
Notes:
1
Rounded to the nearest million.
2
Together with accrued and unpaid dividends.
|
a)
|
declare, pay or set apart for payment any dividends (other than stock dividends in shares of the Corporation ranking junior to the applicable series of Class A Preference Shares) on shares of the Corporation ranking junior to the applicable series of Class A Preference Shares;
|
b)
|
except out of the net cash proceeds of a substantially concurrent issue of shares ranking junior to the applicable series of Class A Preference Shares, redeem, purchase or otherwise retire or make any return of capital in respect of shares of the Corporation ranking junior to the applicable series of Class A Preference Shares;
|
c)
|
except pursuant to any retraction privilege, mandatory redemption or purchase obligation attaching thereto, redeem, purchase or otherwise retire or make any return of capital in respect of any shares of any class or series ranking on a parity with the applicable series of Class A Preference Shares;
|
d)
|
redeem, purchase or otherwise retire or make any return of capital in respect of less than all of the applicable series of Class A Preference Shares
3
; or
|
e)
|
with respect to the applicable series of Class A Preference Shares, issue any additional Class A Preference Shares or any shares ranking on parity as to dividends or capital with the applicable series of Class A Preference Shares
4
;
|
1
|
24 monthly dividends in the case of Class A Preference Shares, Series 15.
|
2
|
In the case of holders of Class A Preference Shares, Series 8 and 9, such holders are only entitled to vote at a meeting which takes place more than 60 days after the date of such failure to pay dividends.
|
3
|
This provision does not apply to Class A Preference Shares, Series 17 and 18.
|
4
|
This provision does not apply to Class A Preference Shares, Series 2, 4, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48 and 49.
|
5
|
This provision does not apply to Class A Preference Shares, Series 2, 4, 6, 8, 9, 13 and 15.
|
6
|
The required quorum for Class A Preference Shares, Series 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48 and 49 is holders of at least 25% of the outstanding shares present in person or represented by proxy. The required quorum for all other Class A Preference Shares is 50% of the outstanding shares present in person or represented by proxy.
|
(a)
|
oversee the work of the Corporation’s external auditor (the “auditor”) engaged for the purpose of preparing or issuing an auditor’s report or performing other audit, review or attest services for the Corporation;
|
(b)
|
require the auditor to report directly to the Committee;
|
(c)
|
review and evaluate the auditor’s independence, experience, qualifications and performance (including the performance of the lead audit partner) and determine whether the auditor should be appointed or re-appointed, and nominate the auditor for appointment or re-appointment by the shareholders;
|
(d)
|
where appropriate, terminate the auditor;
|
(e)
|
when a change of auditor is proposed, review all issues related to the change, including the information to be included in the notice of change of auditor as required, and the orderly transition of such change;
|
(f)
|
review the terms of the auditor’s engagement and the appropriateness and reasonableness of the proposed audit fees;
|
(g)
|
at least annually, obtain and review a report by the auditor describing:
|
(i)
|
the auditor’s internal quality-control procedures; and
|
1
|
Capitalized terms used in this Charter but not otherwise defined herein have the meaning attributed to them in the Board’s “Definitions for Brookfield Asset Management’s Board and Committee Charters” which is annexed hereto as “Annex A”. The Governance and Nominating Committee will review the Definitions Relating to Brookfield Asset Management’s Board and Committee Charters at least annually and submit any proposed amendments to the Board for approval as it deems necessary and appropriate.
|
(ii)
|
any material issues raised by the most recent internal quality control review, or peer review, of the auditor, or review by any independent oversight body such as the Canadian Public Accountability Board or the Public Company Accounting Oversight Board, or inquiry or investigation by any governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the auditor, and the steps taken to deal with any issues raised in any such review;
|
(h)
|
at least annually, confirm that the auditor has submitted a formal written statement describing all of its relationships with the Corporation; discuss with the auditor any disclosed relationships or services that may affect its objectivity and independence; obtain written confirmation from the auditor that it is objective within the meaning of the Rules of Professional Conduct/Code of Ethics adopted by the provincial institute or order of chartered accountants to which it belongs and is an independent public accountant within the meaning of the federal securities legislation administered by the United States Securities and Exchange Commission and of the Independence Standards of the Canadian Institute of Chartered Accountants, and is in compliance with any independence requirements adopted by the Public Company Accounting Oversight Board; and, confirm that the auditor has complied with applicable laws respecting the rotation of certain members of the audit engagement team;
|
(i)
|
ensure the regular rotation of the audit engagement team members as required by law, and periodically consider whether there should be regular rotation of the auditor;
|
(j)
|
meet privately with the auditor as frequently as the Committee feels is appropriate to fulfill its responsibilities, which will not be less frequently than annually, to discuss any items of concern to the Committee or the auditor, including:
|
(i)
|
planning and staffing of the audit;
|
(ii)
|
any material written communications between the auditor and management;
|
(iii)
|
whether or not the auditor is satisfied with the quality and effectiveness of financial recording procedures and systems;
|
(iv)
|
the extent to which the auditor is satisfied with the nature and scope of its examination;
|
(v)
|
whether or not the auditor has received the full co-operation of management of the Corporation;
|
(vi)
|
the auditor’s opinion of the competence and performance of the Chief Financial Officer and other key financial personnel of the Corporation;
|
(vii)
|
the items required to be communicated to the Committee in accordance with generally accepted auditing standards;
|
(viii)
|
all critical accounting policies and practices to be used by the Corporation;
|
(ix)
|
all alternative treatments of financial information within International Financial Reporting Standards (“IFRS”) that have been discussed with management, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the auditor;
|
(x)
|
any difficulties encountered in the course of the audit work, any restrictions imposed on the scope of activities or access to requested information, any significant disagreements with management and management’s response; and
|
(xi)
|
any illegal act that may have occurred and the discovery of which is required to be disclosed to the Committee pursuant to paragraphs 240.41-42 and 250.22-24 of the Canadian Auditing Standards and the United States Securities Exchange Act of 1934, as amended;
|
(k)
|
annually review and approve the Audit and Non-Audit Services Pre-Approval Policy (the “Pre-Approval Policy”), which sets forth the parameters by which the auditor can provide certain audit and non-audit services to the Corporation and its subsidiaries not prohibited by law and the process by which the Committee pre-approves such services. At each quarterly meeting of the Committee, the Committee will ratify all audit and non-audit services provided by the auditor to the Corporation and its subsidiaries for the then-ended quarter;
|
(l)
|
resolve any disagreements between management and the auditor regarding financial reporting;
|
(m)
|
set clear policies for hiring partners and employees and former partners and employees of the external auditor;
|
(a)
|
prior to disclosure to the public, review, and, where appropriate, recommend for approval by the Board, the following:
|
(i)
|
audited annual financial statements, in conjunction with the report of the external auditor;
|
(ii)
|
interim financial statements;
|
(iii)
|
annual and interim management discussion and analysis of financial condition and results of operation;
|
(iv)
|
reconciliations of the annual or interim financial statements, to the extent required under applicable rules and regulations; and
|
(v)
|
all other audited or unaudited financial information contained in public disclosure documents, including without limitation, any prospectus, or other offering or public disclosure documents and financial statements required by regulatory authorities;
|
(b)
|
review and discuss with management prior to public dissemination earnings press releases and other press releases containing financial information (to ensure consistency of the disclosure to the financial statements), as well as financial information and earnings guidance provided to analysts including the use of “pro forma” or “adjusted” non-IFRS information in such press releases and financial information. Such review may consist of a general discussion of the types of information to be disclosed or the types of presentations to be made;
|
(c)
|
review the effect of regulatory and accounting initiatives, as well as any asset or debt financing activities of the Corporation’s unconsolidated subsidiaries that are not required under IFRS to be incorporated into the Corporation’s financial statements (commonly known as “off-balance sheet financing”);
|
(d)
|
review disclosures made to the Committee by the Chief Executive Officer and Chief Financial Officer of the Corporation during their certification process for applicable securities law filings about any significant deficiencies and material weaknesses in the design or operation of the Corporation’s internal control over financial reporting which are reasonably likely to adversely affect the Corporation’s ability to record, process, summarize and report financial information, and any fraud involving management or other employees;
|
(e)
|
review the effectiveness of management’s policies and practices concerning financial reporting, any proposed changes in major accounting policies, the appointment and replacement of management responsible for financial reporting and the internal audit function;
|
(f)
|
review the adequacy of the internal controls that have been adopted by the Corporation to safeguard assets from loss and unauthorized use and to verify the accuracy of the financial records and any special audit steps adopted in light of material control deficiencies;
|
(g)
|
for the financial information of Brookfield Business Partners LP, Brookfield Infrastructure Partners LP, Brookfield Property Partners LP and Brookfield Renewable Partners LP (collectively, the “Public Affiliates”)
2
which is included within the Corporation’s consolidated financial statements (the “Consolidated Public Affiliate Information”), it is understood that the Committee will for the purpose of reviewing the Consolidated Public Affiliate Information to the extent such information is material to the Corporation’s consolidated financial statements (and not for the purpose of reviewing the disclosures of the Public Affiliates themselves which the Committee does not do):
|
(i)
|
rely on the review and approval by the audit committee and the board of directors of the general partner of each respective Public Affiliate;
|
(ii)
|
rely on reports or opinions of the external auditor for each Public Affiliate;
|
(iii)
|
if required in the view of the Committee, review developments in financial reporting at the Public Affiliates; and
|
(iv)
|
if required in the view of the Committee, take all other reasonable steps, directly or through the auditor, to satisfy itself of the integrity of the Consolidated Public Affiliate Information;
|
(h)
|
for the financial information of any other subsidiary entity below the Corporation that has an audit committee which is comprised of a majority of independent directors, and which is included in the Corporation’s consolidated financial statements, it is understood that the Committee will rely on the review and approval of such information by the audit committee and the board of directors of each such subsidiary;
|
(a)
|
meet privately with the person responsible for the Corporation’s internal audit function (the “internal auditor”) as frequently as the Committee feels appropriate to fulfill its responsibilities, which will not be less frequently than annually, to discuss any items of concern;
|
2
|
The four publicly-traded affiliates of the Corporation that are each individually considered material subsidiaries of the Corporation in the opinion of management.
|
(b)
|
require the internal auditor to report directly to the Committee;
|
(c)
|
review the mandate, budget, planned activities, staffing and organizational structure of the internal audit function (which may be outsourced to a firm other than the auditor) to confirm that it is independent of management and has sufficient resources to carry out its mandate. The Committee will discuss this mandate with the auditor, review the appointment and replacement of the internal auditor and review the significant reports to management prepared by the internal auditor and management’s responses. As part of this process, the Committee reviews and approves the governing charter of the internal audit function on an annual basis;
|
(d)
|
review the controls and procedures that have been adopted to confirm that material financial information about the Corporation and its subsidiaries that is required to be disclosed under applicable law or stock exchange rules is disclosed, review the public disclosure of financial information extracted or derived from the Corporation’s financial statements and periodically assess the adequacy of such controls and procedures;
|
(e)
|
review of allegations of fraud related to financial reporting that are brought to or come to the attention of the Committee through the Corporation’s ethics hotline, a referral by management or of the Risk Management Committee of the Board, or otherwise;
|
(f)
|
periodically review the status of taxation matters of the Corporation; and
|
(g)
|
consider other matters of a financial nature as directed by the Board.
|
(a)
|
the auditor’s independence;
|
(b)
|
the performance of the auditor and the Committee’s recommendations regarding its reappointment or termination;
|
(c)
|
the performance of the internal audit function;
|
(d)
|
the adequacy of the Corporation’s internal controls and disclosure controls;
|
(e)
|
its recommendations regarding the annual and interim financial statements of the Corporation, to the extent applicable, and any reconciliation of the Corporation’s financial statements, including any issues with respect to the quality or integrity of the financial statements;
|
(f)
|
its review of any other public disclosure document including the annual report and the annual and interim management’s discussion and analysis of financial condition and results of operations;
|
(g)
|
the Corporation’s compliance with legal and regulatory requirements, particularly those related to financial reporting; and
|
(h)
|
all other significant matters it has addressed and with respect to such other matters that are within its responsibilities.
|
(a)
|
an understanding of International Financial Reporting Standards, as adopted by the International Accounting Standards Board, and financial statements;
|
(b)
|
the ability to assess the general application of such principles in connection with the accounting for estimates, accruals and reserves;
|
(c)
|
experience preparing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Corporation’s financial statements, or experience actively supervising one or more persons engaged in such activities;
|
(d)
|
an understanding of internal controls and procedures for financial reporting; and
|
(e)
|
an understanding of audit committee functions; acquired through any one or more of the following:
|
(i)
|
education and experience as a principal financial officer, principal accounting officer, controller, public accountant or auditor or experience in one or more positions that involve the performance of similar functions;
|
(ii)
|
experience actively supervising a principal financial officer, principal accounting officer, controller, public accountant, auditor or person performing similar functions;
|
(iii)
|
experience overseeing or assessing the performance of companies or public accountants with respect to the preparation, auditing or evaluation of financial statements; or
|
(iv)
|
other relevant experience.
|
(a)
|
is or was an employee or executive officer, or whose Immediate Family Member is or was an executive officer, of the Corporation is not independent until three years after the end of such employment relationship;
|
(b)
|
is receiving or has received, or whose Immediate Family Member is an executive officer of the Corporation and is receiving or has received, during any 12-month period within the last three years more than Cdn$75,000 in direct compensation from the Corporation, other than director and committee fees and pension or other forms of fixed compensation under a retirement plan (including deferred compensation) for prior service (provided such compensation is not contingent in any way on continued service), is not independent;
|
(c)
|
is or was a partner of, affiliated with or employed by, or whose Immediate Family Member is or was a partner of or employed in an audit, assurance, or tax compliance practice in a professional capacity by, the Corporation’s present or former internal or external auditor, is not independent until three years after the end of such partnership, affiliation, or employment relationship, as applicable, with the auditor;
|
(d)
|
is or was employed as, or whose immediate family member is or was employed as, an executive officer of another company (or its parent or a subsidiary) where any of the present (at the time of review) executive officers of the Corporation serve or served on that company’s (or its parent’s or a subsidiary’s) compensation committee, is not independent until three years after the end of such service or the employment relationship, as applicable; and
|
(e)
|
is an executive officer or an employee of, or whose Immediate Family Member is an executive officer of, another company (or its parent or a subsidiary) that has made payments to, or received payments from, the Corporation for property or services in an amount which, in any of the last three fiscal years exceeds the greater of US$1 million or 2% of such other company’s consolidated gross revenues, in each case, is not independent.
|
(a)
|
accept directly or indirectly, any consulting, advisory, or other compensatory fee from the Corporation, other than director and committee fees and pension or other forms of fixed compensation under a retirement plan (including deferred compensation) for prior service (provided such compensation is not contingent in any way on continued service); or
|
(b)
|
be an affiliated person of the Corporation (within the meaning of applicable rules and regulations).
|
PART 1 –
OUR BUSINESS AND STRATEGY
|
Infrastructure
|
||
Our Business
|
Private Equity
|
||
Organizational Structure
|
Residential Development
|
||
PART 2 –
REVIEW OF CONSOLIDATED
|
|
Corporate Activities
|
|
FINANCIAL RESULTS
|
|
PART 4 –
CAPITALIZATION AND LIQUIDITY
|
|
Overview
|
Capitalization
|
||
Income Statement Analysis
|
Liquidity
|
||
Balance Sheet Analysis
|
Review of Consolidated Statements of Cash Flows
|
||
Consolidation and Fair Value Accounting
|
Contractual Obligations
|
||
Foreign Currency Translation
|
Exposures to Selected Financial Information
|
||
Summary of Quarterly Results
|
PART 5 –
ACCOUNTING POLICIES AND INTERNAL
|
|
|
Corporate Dividends
|
CONTROLS
|
|
|
PART 3 –
OPERATING SEGMENT RESULTS
|
Accounting Policies, Estimates and Judgments
|
||
Basis of Presentation
|
Management Representations and Internal Controls
|
||
Summary of Results by Operating Segment
|
Related Party Transactions
|
||
Asset Management
|
PART 6 –
BUSINESS ENVIRONMENT AND RISKS
|
||
Real Estate
|
GLOSSARY OF TERMS
|
|
|
Renewable Power
|
|
|
ü
|
Investment focus
|
ü
|
Diverse products offering
|
ü
|
Focused investment strategies
|
ü
|
Disciplined financing approach
|
1.
|
Large-scale capital
|
2.
|
Operating expertise
|
3.
|
Global presence
|
1.
|
Diversified and long-term
base management fees
which are based on closed-end and long-life fund capital. Closed-end fund capital is typically committed for 10 years with two one-year extension options, and our long-life funds are perpetual vehicles that can continually raise new capital.
|
2.
|
Carried interest
, which enables us to receive a portion of overall fund profits provided that investors receive a minimum prescribed preferred return. Carried interest is recognized once it is no longer subject to clawback.
|
1.
|
Long-term perpetual
base management fees
, which are based on our listed vehicles’ total capitalization.
|
2.
|
Stable
incentive distribution fees
which are linked to cash distributions (BPY, BEP and BIP). These cash distributions have exceeded pre-determined thresholds and have a historic annual growth rate of 5-9%.
|
3.
|
Performance fees
based on unit price performance (BBU).
|
•
|
Transparent
–
approximately 80% of our invested capital is listed partnerships (BPY, BEP, BIP, BBU) and other smaller publicly traded investments. The remaining is primarily held in a residential homebuilding business, and a few other directly held investments.
|
•
|
Diversified, long-term, stable cash flows
–
received from our underlying public investments. These cash flows are underpinned by investments in real assets which should provide inflation protection and less volatility compared to traditional equities, and higher yields compared to fixed income.
|
•
|
Strong alignment of interests
–
the Corporation is the largest investor into each of our listed partnerships, and in turn, the listed partnerships are typically the largest investor in each of our private funds.
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
Raise Capital
As an asset manager, the starting point is forming new funds and other investment products to which investors are willing to commit capital. This will, in turn, provide us with capital to invest and the opportunity to earn base management fees and performance-based returns such as incentive distributions and carried interest. Accordingly, we create value by increasing the amount of fee bearing capital and by achieving strong investment performance that leads to increased cash flows and asset values.
|
|
|
|
|
|
Identify and Acquire High-Quality Assets
We follow a value-based approach to investing and allocating capital. We believe our disciplined approach, global reach and our expertise in recapitalizations and operational turnarounds enable us to identify a wide range of potential opportunities, some of which are challenging for others to pursue, and allow us to invest at attractive valuations and generate superior risk-adjusted returns. We also have considerable expertise in executing large development and capital projects, providing additional opportunities to deploy capital.
|
|
|
|
|
|
Secure Long-Term Financing
We finance our operations primarily on a long-term, investment-grade basis, and most of our capital consists of equity and standalone asset-by-asset financing with minimal recourse to other parts of the organization. We utilize relatively modest levels of corporate debt to provide operational flexibility and optimize returns. This provides us with considerable stability, improves our ability to withstand financial downturns and enables our management teams to focus on operations and other growth initiatives.
|
|
|
|
|
|
Enhance Value and Cash Flows Through Operating Expertise
Our operating capabilities enable us to increase the value of the assets within our businesses and the cash flows they produce, and they protect capital better in adverse conditions. Our operating expertise, development capabilities and effective financing can help ensure that an investment’s full value creation potential is realized by optimizing operations and development projects. We believe this is one of our most important competitive advantages as an asset manager.
|
|
|
|
|
|
Realize Capital from Asset Sale or Refinancings
We actively monitor opportunities to sell or refinance assets to generate proceeds that we return to investors in the case of limited life funds and redeploy to enhance returns in the case of perpetual entities. In many cases, returning capital from private funds completes the investment process locking in investor returns and giving rise to performance income.
|
|
|
|
|
|
Our Operating Cycle Leads to Value Creation
We create value from earning robust returns on our investments that compound over time and grow our fee bearing capital. By generating value for our investors and shareholders, we increase fees and carried interest received in our asset management business and grow cash flows that compound value in our invested capital.
|
|
i)
|
The Corporation:
|
•
|
Strong levels of liquidity are maintained to support growth and ongoing operations.
|
•
|
Capitalization consists of a large common equity base, supplemented with perpetual preferred shares, long-dated corporate bonds and, from time to time, draws on our corporate credit facilities.
|
•
|
Negligible guarantees are provided on the financial obligations of listed partnerships and managed funds.
|
•
|
High levels of cash flows are available after common share dividends.
|
ii)
|
Our listed partnerships (BPY, BEP, BIP and BBU):
|
•
|
Strong levels of liquidity are maintained at each of the listed partnerships to support their growth and ongoing operations.
|
•
|
Listed partnerships are intended to be self-funding with stable capitalization through market cycles.
|
•
|
Financial obligations have no recourse to the Corporation.
|
iii)
|
Managed funds, or operating asset level in directly held investments:
|
•
|
Each underlying investment is typically funded on a standalone basis.
|
•
|
Fund level borrowings are generally limited to subscription facilities which are backed by the capital commitments to the fund.
|
•
|
Financial obligations have no recourse to the Corporation.
|
•
|
Maintain significant liquidity at the corporate level, primarily in the form of cash, financial assets and undrawn credit lines. Ensure our listed partnerships can finance their operations on a standalone basis without recourse to or reliance on the Corporation.
|
•
|
Structure our borrowings and other financial obligations to provide a stable capitalization at levels that are attractive to investors, are sustainable on a long-term basis and can withstand business cycles.
|
•
|
The vast majority of this debt is at investment-grade levels, however, periodically, we may borrow at sub-investment grade levels in certain parts of our business where the borrowings are carefully structured and monitored.
|
•
|
Provide recourse only to the specific businesses or assets being financed, without cross-collateralization or parental guarantees.
|
•
|
Match the duration of our debt to the underlying leases or contracts and match the currency of our debt to that of the assets such that our remaining exposure is on the net equity of the investment.
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
% of Total
|
|
|
Corporate borrowings
|
$
|
6,409
|
|
|
17
|
%
|
Accounts payable and other liabilities
|
2,496
|
|
|
6
|
%
|
|
Preferred equity
|
4,168
|
|
|
11
|
%
|
|
Common equity - book value
|
25,647
|
|
|
66
|
%
|
|
Corporate capitalization
|
$
|
38,720
|
|
|
100
|
%
|
AS AT DEC 31, 2018
(MILLIONS) |
Corporate Liquidity
|
|
|
Group Liquidity
|
|
||
Cash and financial assets, net
|
$
|
2,275
|
|
|
$
|
3,752
|
|
Undrawn committed credit facilities
|
1,867
|
|
|
7,061
|
|
||
Core liquidity
1
|
4,142
|
|
|
10,813
|
|
||
Third-party uncalled private fund commitments
|
—
|
|
|
23,575
|
|
||
Total liquidity
1
|
$
|
4,142
|
|
|
$
|
34,388
|
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
•
|
Fee related earnings that are supported by long-term and perpetual contractual agreements.
|
•
|
Distributions from listed investments that are stable and backed by high-quality operating assets.
|
FOR THE YEAR ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Fee related earnings
|
$
|
1,129
|
|
|
$
|
896
|
|
Realized carried interest
|
188
|
|
|
74
|
|
||
Distributions from investments
|
1,698
|
|
|
1,351
|
|
||
Other invested capital earnings
|
|
|
|
||||
Corporate activities
|
(486
|
)
|
|
(300
|
)
|
||
Other wholly-owned investments
|
41
|
|
|
23
|
|
||
|
(445
|
)
|
|
(277
|
)
|
||
Preferred share dividends
|
(151
|
)
|
|
(145
|
)
|
||
Total cash available for distribution and/or reinvestment
1
|
$
|
2,419
|
|
|
$
|
1,899
|
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
•
|
Risk Management Steering Committee
to coordinate the risk management program on an enterprise-wide basis;
|
•
|
Investment Committees
to oversee the investment process, as well as monitor the ongoing performance of investments;
|
•
|
Conflicts Committee
to resolve potential conflict situations in the investment process and other corporate transactions;
|
•
|
Financial Risk Oversight Committee
to review and monitor financial exposures;
|
•
|
Environmental, Social and Governance (“ESG”) Committee
to coordinate ESG initiatives;
|
•
|
Safety Steering Committee
to focus on health, safety and security matters; and
|
•
|
Disclosure Committee
to oversee the public disclosure of material information.
|
•
|
Risk Management Committee
oversees the management of Brookfield’s significant financial and non-financial risk exposures, including review of risk assessment and risk management practices and confirming that the company has an appropriate risk-taking philosophy and suitable risk capacity.
|
•
|
Audit Committee
oversees the management of risks related to Brookfield’s systems and procedures for financial reporting, as well as for associated audit processes (internal and external).
|
•
|
Management Resources and Compensation Committee
oversees the risks related to Brookfield’s management resource planning, including succession planning, executive compensation and senior executives’ performance.
|
•
|
Governance and Nominating Committee
oversees the risks related to Brookfield’s governance structure, including the effectiveness of board and committee activities and potential conflicts of interest.
|
>40
|
%
|
ä
|
of our overall workforce
|
40
|
%
|
ä
|
of our independent board directors
|
20
|
%
|
ä
|
of our senior vice-presidents and above (up from 11% three years ago)
|
•
|
same-store
1
growth across many of our businesses;
|
•
|
fair value gains of
$1.8 billion
relating primarily to investment property valuation gains and various transaction-related gains, including the impact of completing step-up acquisitions in our real estate and private equity businesses; and
|
•
|
deferred tax recoveries, relating primarily to the projected utilization of previously unrecognized loss carryforwards; partially offset by
|
•
|
the absence of income from assets sold, higher taxes and increases in interest expense on new borrowings.
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
|
|
|
|
|
|
|
Change
|
||||||||||||
FOR THE YEARS ENDED DEC. 31
(MILLIONS, EXCEPT PER SHARE AMOUNTS) |
2018
|
|
|
2017
|
|
|
2016
|
|
|
2018 vs 2017
|
|
|
2017 vs 2016
|
|
|||||
Revenues
1
|
$
|
56,771
|
|
|
$
|
40,786
|
|
|
$
|
24,411
|
|
|
$
|
15,985
|
|
|
$
|
16,375
|
|
Direct costs
|
(45,519
|
)
|
|
(32,388
|
)
|
|
(17,718
|
)
|
|
(13,131
|
)
|
|
(14,670
|
)
|
|||||
|
11,252
|
|
|
8,398
|
|
|
6,693
|
|
|
2,854
|
|
|
1,705
|
|
|||||
Other income and gains
|
1,166
|
|
|
1,180
|
|
|
482
|
|
|
(14
|
)
|
|
698
|
|
|||||
Equity accounted income
|
1,088
|
|
|
1,213
|
|
|
1,293
|
|
|
(125
|
)
|
|
(80
|
)
|
|||||
Expenses
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest
|
(4,854
|
)
|
|
(3,608
|
)
|
|
(3,233
|
)
|
|
(1,246
|
)
|
|
(375
|
)
|
|||||
Corporate costs
|
(104
|
)
|
|
(95
|
)
|
|
(92
|
)
|
|
(9
|
)
|
|
(3
|
)
|
|||||
Fair value changes
|
1,794
|
|
|
421
|
|
|
(130
|
)
|
|
1,373
|
|
|
551
|
|
|||||
Depreciation and amortization
|
(3,102
|
)
|
|
(2,345
|
)
|
|
(2,020
|
)
|
|
(757
|
)
|
|
(325
|
)
|
|||||
Income taxes
|
248
|
|
|
(613
|
)
|
|
345
|
|
|
861
|
|
|
(958
|
)
|
|||||
Net income
|
7,488
|
|
|
4,551
|
|
|
3,338
|
|
|
2,937
|
|
|
1,213
|
|
|||||
Non-controlling interests
|
(3,904
|
)
|
|
(3,089
|
)
|
|
(1,687
|
)
|
|
(815
|
)
|
|
(1,402
|
)
|
|||||
Net income attributable to shareholders
|
$
|
3,584
|
|
|
$
|
1,462
|
|
|
$
|
1,651
|
|
|
$
|
2,122
|
|
|
$
|
(189
|
)
|
Net income per share
|
$
|
3.40
|
|
|
$
|
1.34
|
|
|
$
|
1.55
|
|
|
$
|
2.06
|
|
|
$
|
(0.21
|
)
|
1.
|
2017 and 2016 revenues have not been restated as we adopted IFRS 15 using the modified retrospective method as at January 1, 2018.
|
•
|
$16.3 billion
of additional revenues earned from acquisitions during the current and prior year across each of our listed partnerships
1
, most notably the purchase of our road fuel distribution business in the second quarter of last year, which added $8.8 billion of incremental revenues. Included in this business’ revenues and direct costs are significant flow-through duty amounts that are passed through to the customers and recorded gross in both accounts, without impact to margin generated by the business;
|
•
|
initiatives in our existing infrastructure businesses, in particular from strong connections activity at our regulated distribution business and higher tariffs and strong volumes across a number of our transport operations; and
|
•
|
same-store increases, including improved performance at our graphite electrode manufacturing business and growth in our real estate business from strong core office same-property leasing growth of 5.9%; partially offset by
|
•
|
the absence of
$390 million
of revenues from businesses sold and the deconsolidation of Norbord Inc. (“Norbord”)
1
in the fourth quarter of 2017, which contributed $1.7 billion of revenues in 2017.
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
•
|
valuation losses at various equity accounted investments, particularly certain
GGP investment properties prior to its privatization
;
|
•
|
higher depreciation costs of $190 million relating to recent acquisitions; and
|
•
|
the consolidation of previously equity accounted entities as a result of increases in our ownership interest; partially offset by
|
•
|
an increase in FFO from equity accounted investments of $303 million due to
contributions from recent investments, particularly
our investment in
our entertainment operations and the impact of FFO generated by Norbord which was consolidated up until the fourth quarter of 2017
.
|
•
|
the impact of step-up acquisitions of GGP in our Real Estate segment and a service provider to the offshore oil production industry in our Private Equity segment, partially offset by successful deal costs;
|
•
|
valuation gains on properties in our core office and LP investments
1
portfolios;
|
•
|
gains recorded on the extinguishment of a debt obligation associated with a hospitality property; and
|
•
|
gains related to the acquisitions and restructuring of businesses within our U.S. operations that resulted in the recognition of deferred tax assets; partially offset by
|
•
|
net unrealized losses on financial contracts entered into to manage foreign currency, interest rates and pricing exposures.
|
1.
|
Formerly referred to as Opportunistic.
|
•
|
increases in the values of our LP investments real estate portfolios;
|
•
|
a gain recorded when we deconsolidated our investment in Norbord; and
|
•
|
the absence of a one-time impairment loss in 2016 on the conversion of a debt instrument to equity in our Private Equity segment; partially offset by
|
•
|
valuation losses in our core office portfolio, mark-to-market losses on our GGP warrants prior to exercise and mark-to-market losses on foreign exchange derivatives that do not qualify for hedge accounting.
|
FOR THE YEAR ENDED DEC. 31, 2018
(MILLIONS) |
Acquisitions
|
|
Dispositions
|
||||||||||||
Revenue
|
|
|
Net Income
|
|
|
Revenue
|
|
|
Net Income
|
|
|||||
Real estate
|
$
|
1,430
|
|
|
$
|
516
|
|
|
$
|
(336
|
)
|
|
$
|
(118
|
)
|
Renewable power
|
1,117
|
|
|
165
|
|
|
(15
|
)
|
|
(13
|
)
|
||||
Infrastructure
|
1,157
|
|
|
211
|
|
|
—
|
|
|
(9
|
)
|
||||
Private equity and other
|
12,642
|
|
|
62
|
|
|
(39
|
)
|
|
(15
|
)
|
||||
|
16,346
|
|
|
954
|
|
|
(390
|
)
|
|
(155
|
)
|
||||
Gains recognized in net income
|
—
|
|
|
833
|
|
|
—
|
|
|
592
|
|
||||
|
$
|
16,346
|
|
|
$
|
1,787
|
|
|
$
|
(390
|
)
|
|
$
|
437
|
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
Change
|
|
|||
Investment properties
|
$
|
1,610
|
|
|
$
|
1,021
|
|
|
$
|
589
|
|
Transaction related gains, net of deal costs
|
1,132
|
|
|
637
|
|
|
495
|
|
|||
Financial contracts
|
(189
|
)
|
|
(868
|
)
|
|
679
|
|
|||
Impairments and provisions
|
(309
|
)
|
|
(344
|
)
|
|
35
|
|
|||
Other fair value changes
|
(450
|
)
|
|
(25
|
)
|
|
(425
|
)
|
|||
Total fair value changes
|
$
|
1,794
|
|
|
$
|
421
|
|
|
$
|
1,373
|
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
Change
|
|
|||
Core office
|
$
|
150
|
|
|
$
|
(864
|
)
|
|
$
|
1,014
|
|
LP Investments and other
|
1,460
|
|
|
1,885
|
|
|
(425
|
)
|
|||
|
$
|
1,610
|
|
|
$
|
1,021
|
|
|
$
|
589
|
|
•
|
strong leasing activity in our Sydney and Toronto portfolios; and
|
•
|
an increase in value in a London development property as the asset nears completion; partially offset by
|
•
|
fair value adjustments in our downtown New York properties.
|
•
|
our U.S. logistics portfolio, for which we reduced discount rates as development properties approached stabilization, increased cash flow assumptions due to strong overall leasing and updated values to reflect recent market transactions and purchase offers; and
|
•
|
higher cash flow projections for our office portfolio in India to reflect the impact of regulatory changes that allow for an increase in leasable area; partially offset by
|
•
|
valuation losses on our opportunistic retail portfolio.
|
•
|
gains of $584 million arising from the acquisitions and restructuring of businesses within our U.S. operations that resulted in the recognition of tax assets;
|
•
|
the privatization of GGP, resulting in a net transaction related gain of
$422 million
. The net gain on acquisition was partially offset by fair value adjustments to adjust the carrying value of our investment in GGP to its fair value immediately prior to acquiring control;
|
•
|
a
$411 million
gain following the extinguishment of outstanding debt relating to a hospitality asset; and
|
•
|
a
$250 million
gain recognized on taking control of a service provider to the offshore oil production industry. This includes a gain of $44 million on the settlement of subsidiary level debt and warrants; partially offset by
|
•
|
deal costs of $582 million across the company, primarily from acquisitions completed during the year in our private equity and real estate businesses.
|
|
|
|
|
|
|
|
Change
|
||||||||||||
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
2016
|
|
|
2018 vs 2017
|
|
|
2017 vs 2016
|
|
|||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment properties
|
$
|
84,309
|
|
|
$
|
56,870
|
|
|
$
|
54,172
|
|
|
$
|
27,439
|
|
|
$
|
2,698
|
|
Property, plant and equipment
|
67,294
|
|
|
53,005
|
|
|
45,346
|
|
|
14,289
|
|
|
7,659
|
|
|||||
Equity accounted investments
|
33,647
|
|
|
31,994
|
|
|
24,977
|
|
|
1,653
|
|
|
7,017
|
|
|||||
Cash and cash equivalents
1
|
8,390
|
|
|
5,139
|
|
|
4,299
|
|
|
3,251
|
|
|
840
|
|
|||||
Accounts receivable and other
1
|
16,931
|
|
|
11,973
|
|
|
9,133
|
|
|
4,958
|
|
|
2,840
|
|
|||||
Intangible assets
|
18,762
|
|
|
14,242
|
|
|
6,073
|
|
|
4,520
|
|
|
8,169
|
|
|||||
Goodwill
|
8,815
|
|
|
5,317
|
|
|
3,783
|
|
|
3,498
|
|
|
1,534
|
|
|||||
Other assets
|
18,133
|
|
|
14,180
|
|
|
12,043
|
|
|
3,953
|
|
|
2,137
|
|
|||||
Total Assets
|
$
|
256,281
|
|
|
$
|
192,720
|
|
|
$
|
159,826
|
|
|
$
|
63,561
|
|
|
$
|
32,894
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate borrowings
1
|
$
|
6,409
|
|
|
$
|
5,659
|
|
|
$
|
4,500
|
|
|
$
|
750
|
|
|
$
|
1,159
|
|
Non-recourse borrowings of managed entities
1
|
111,809
|
|
|
72,730
|
|
|
60,391
|
|
|
39,079
|
|
|
12,339
|
|
|||||
Other non-current financial liabilities
1
|
13,528
|
|
|
10,478
|
|
|
7,759
|
|
|
3,050
|
|
|
2,719
|
|
|||||
Other liabilities
|
27,385
|
|
|
23,981
|
|
|
17,488
|
|
|
3,404
|
|
|
6,493
|
|
|||||
Equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Preferred equity
|
4,168
|
|
|
4,192
|
|
|
3,954
|
|
|
(24
|
)
|
|
238
|
|
|||||
Non-controlling interests
|
67,335
|
|
|
51,628
|
|
|
43,235
|
|
|
15,707
|
|
|
8,393
|
|
|||||
Common equity
|
25,647
|
|
|
24,052
|
|
|
22,499
|
|
|
1,595
|
|
|
1,553
|
|
|||||
Total Equity
|
97,150
|
|
|
79,872
|
|
|
69,688
|
|
|
17,278
|
|
|
10,184
|
|
|||||
|
$
|
256,281
|
|
|
$
|
192,720
|
|
|
$
|
159,826
|
|
|
$
|
63,561
|
|
|
$
|
32,894
|
|
1.
|
The amounts for the year ended December 31, 2018 have been prepared in accordance with IFRS 9. Prior period amounts have not been restated (refer to Note 2 of the consolidated financial statements).
|
(MILLIONS)
|
Real Estate
|
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Renewable Power and Other
|
|
|
Total
|
|
|||||
Cash and cash equivalents
|
$
|
1,056
|
|
|
$
|
71
|
|
|
$
|
658
|
|
|
$
|
388
|
|
|
$
|
2,173
|
|
Accounts receivable and other
|
2,247
|
|
|
511
|
|
|
2,267
|
|
|
623
|
|
|
5,648
|
|
|||||
Inventory
|
150
|
|
|
23
|
|
|
686
|
|
|
5
|
|
|
864
|
|
|||||
Equity accounted investments
|
12,379
|
|
|
15
|
|
|
329
|
|
|
29
|
|
|
12,752
|
|
|||||
Investment properties
|
33,024
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,024
|
|
|||||
Property, plant and equipment
|
1,748
|
|
|
2,945
|
|
|
4,913
|
|
|
2,970
|
|
|
12,576
|
|
|||||
Intangible assets
|
54
|
|
|
3,208
|
|
|
2,942
|
|
|
386
|
|
|
6,590
|
|
|||||
Goodwill
|
96
|
|
|
2,905
|
|
|
971
|
|
|
186
|
|
|
4,158
|
|
|||||
Deferred income tax assets
|
220
|
|
|
—
|
|
|
38
|
|
|
582
|
|
|
840
|
|
|||||
Total assets
|
50,974
|
|
|
9,678
|
|
|
12,804
|
|
|
5,169
|
|
|
78,625
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other
|
(2,177
|
)
|
|
(591
|
)
|
|
(3,657
|
)
|
|
(715
|
)
|
|
(7,140
|
)
|
|||||
Non-recourse borrowings
|
(18,218
|
)
|
|
(1,484
|
)
|
|
(3,669
|
)
|
|
(2,023
|
)
|
|
(25,394
|
)
|
|||||
Deferred income tax liabilities
|
(58
|
)
|
|
(839
|
)
|
|
(156
|
)
|
|
(210
|
)
|
|
(1,263
|
)
|
|||||
Non-controlling interests
1
|
(2,603
|
)
|
|
(544
|
)
|
|
(512
|
)
|
|
(22
|
)
|
|
(3,681
|
)
|
|||||
|
(23,056
|
)
|
|
(3,458
|
)
|
|
(7,994
|
)
|
|
(2,970
|
)
|
|
(37,478
|
)
|
|||||
Net assets acquired
|
$
|
27,918
|
|
|
$
|
6,220
|
|
|
$
|
4,810
|
|
|
$
|
2,199
|
|
|
$
|
41,147
|
|
1.
|
Includes non-controlling interests recognized on business combinations measured as the proportionate share of fair value of the identifiable assets and liabilities on the date of acquisition. For certain business combinations in our Private Equity segment, non-controlling interest recognized on business combinations is measured at the proportionate fair value of the total net assets on the date of acquisition.
|
•
|
acquisitions of
$33.0 billion
, including
$18.0 billion
of investment properties at GGP which were previously reported through equity accounted investments and
$9.4 billion
through the acquisition of a diversified U.S. REIT with office, multifamily and retail assets. Other notable investments include a U.K. student housing portfolio, office buildings in New York and Chicago, an office park in Mumbai and a mixed-use entertainment complex in Germany;
|
•
|
additions of
$3.1 billion
as we enhanced or expanded numerous properties through capital expenditures; and
|
•
|
valuation gains recorded in fair value changes of
$1.6 billion
, largely within our LP investments portfolio (refer to page 34 for further information); partially offset by
|
•
|
the
$1.7 billion
impact of decreasing foreign exchange rates; and
|
•
|
sales or reclassifications of
$8.6 billion
, including office properties in Toronto and Sydney,
112 storage properties across the U.S., our U.S. logistics portfolio
and the
reclassification of a number of properties to held for sale, including office properties in the U.S. and Brazil and a mixed-use portfolio in China
.
|
•
|
acquisitions of
$12.6 billion
across our operating segments, including
one of North America’s leading providers of essential residential energy infrastructure, a western Canadian natural gas gathering and processing business, a service provider to the power generation industry, extended-stay hotels across the U.S., wind and solar assets in Europe and the consolidation of a service provider to the offshore oil production industry that was previously equity accounted;
|
•
|
revaluation surplus of $5.6 billion in our Renewable Power segment, primarily attributed to the benefit of the United States tax reform enacted into law in 2017 and the successful integration of key acquisitions into the business; and
|
•
|
additions of $2.1 billion primarily related to growth capital expenditures across our operating segments; partially offset by
|
•
|
the negative impact of foreign currency translation of $3.0 billion; and
|
•
|
sales and depreciation in the period, including the impact of reclassifying
$749 million
to assets held for sale as part of the expected sale of certain wind and solar assets in non-core regions within our Renewable Power segment.
|
•
|
the $2.5 billion net impact of the GGP transaction, as the consolidation of equity accounted investments held within GGP was partially offset by the derecognition of the carrying value of our investment prior to consolidation;
|
•
|
$3.1 billion of other additions or acquisitions through business combinations across our operating segments, including assets acquired as part of the acquisition of a diversified U.S. REIT in the fourth quarter; and
|
•
|
our share of comprehensive income of $1.6 billion; partially offset by
|
•
|
the sale of our $1.0 billion Chilean electricity transmission business;
|
•
|
the reclassification of a
service provider to the offshore oil production industry and
two entities in our Real Estate and Corporate segments after increasing our ownership, thereby gaining control during the year; and
|
•
|
distributions received and returns of capital of $1.9 billion.
|
•
|
acquisitions completed in the year;
|
•
|
$840 million
of deferred income tax assets from the recognition of net operating losses that can be used to offset future projected net income; and
|
•
|
an increase in assets held for sale of
$580 million
, primarily attributable to the reclassification of certain wind and solar assets in our Renewable Power segment, as well as a Shanghai property portfolio in our Real Estate segment.
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Common equity, beginning of year
|
$
|
24,052
|
|
|
$
|
22,499
|
|
Changes in period
|
|
|
|
||||
Changes in accounting policies
|
(218
|
)
|
|
—
|
|
||
Net income to shareholders
|
3,584
|
|
|
1,462
|
|
||
Common dividends
|
(575
|
)
|
|
(642
|
)
|
||
Preferred dividends
|
(151
|
)
|
|
(145
|
)
|
||
Foreign currency translation
|
(959
|
)
|
|
280
|
|
||
Other comprehensive income
|
1,365
|
|
|
569
|
|
||
Share repurchases, net of issuances and vesting
|
(359
|
)
|
|
(103
|
)
|
||
Ownership changes and other
|
(1,092
|
)
|
|
132
|
|
||
|
1,595
|
|
|
1,553
|
|
||
Common equity, end of year
|
$
|
25,647
|
|
|
$
|
24,052
|
|
•
|
a reduction in opening common equity of
$218 million
to reflect the adjustments required to transition to IFRS 15
Revenue from Contracts with Customers
(“IFRS 15”) and IFRS 9
Financial Instruments
(“IFRS 9”);
|
•
|
net income attributable to shareholders of
$3.6 billion
;
|
•
|
foreign currency translation losses of
$959 million
as average foreign currency rates in the jurisdictions where we hold the majority of our non-U.S. dollar investments weakened relative to the U.S. dollar;
|
•
|
other comprehensive income of
$1.4 billion
relating primarily to the revaluation surplus recorded on revaluing our property, plant and equipment at year end;
|
•
|
share repurchases, net of issuances and vesting, of
$359 million
, which included
$388 million
paid to repurchase
9.6 million
Class A common shares (“Class A shares”)
, of which $310 million was to fund long-term compensation plans; and
|
•
|
ownership changes and other which are primarily related to the dilution loss to reflect our reduced ownership interest in BPY following the GGP privatization, partially offset by gains relating to the partial disposition of our graphite electrode manufacturing business through initial and secondary public offerings in the second and third quarters, respectively.
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Brookfield Property Partners L.P.
|
$
|
31,580
|
|
|
$
|
19,736
|
|
Brookfield Renewable Partners L.P.
|
12,457
|
|
|
10,139
|
|
||
Brookfield Infrastructure Partners L.P.
|
12,752
|
|
|
11,376
|
|
||
Brookfield Business Partners L.P.
|
4,477
|
|
|
4,000
|
|
||
Other participating interests
|
6,069
|
|
|
6,377
|
|
||
|
$
|
67,335
|
|
|
$
|
51,628
|
|
•
|
comprehensive income attributable to non-controlling interests which totaled
$5.7 billion
; this is inclusive of foreign currency translation losses as
average foreign currency rates in the jurisdictions where we hold the majority of our non-U.S. dollar investments weakened relative to the U.S. dollar
;
|
•
|
ownership changes attributable to non-controlling interests of
$10.2 billion
; and
|
•
|
net equity issuances to non-controlling interests totaling
$6.7 billion
; partially offset by
|
•
|
$6.7 billion
of distributions to non-controlling interests.
|
•
|
U.S. GAAP uses a voting interest model or a variable interest model to determine consolidation requirements, depending on the circumstances, whereas IFRS uses a control-based model. We generally have the contractual ability to unilaterally direct the relevant activities of our funds; and
|
•
|
we generally invest significant amounts of capital alongside our investors and partners, which, in addition to our customary management fees and incentive fees, means that we earn meaningful returns as a principal investor in addition to our asset management returns compared to a manager who acts solely as an agent.
|
AS AT DEC. 31
|
Year-End Spot Rate
|
|
Change
|
|
Average Rate
|
|
Change
|
||||||||||||||||||||||
2018
|
|
|
2017
|
|
|
2016
|
|
|
2018 vs 2017
|
|
|
2017 vs 2016
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|
2018 vs 2017
|
|
|
2017 vs 2016
|
|
|
Australian dollar
|
0.7050
|
|
|
0.7809
|
|
|
0.7197
|
|
|
(10
|
)%
|
|
9
|
%
|
|
0.7475
|
|
|
0.7669
|
|
|
0.7441
|
|
|
(3
|
)%
|
|
3
|
%
|
Brazilian real
1
|
3.8745
|
|
|
3.3080
|
|
|
3.2595
|
|
|
(15
|
)%
|
|
(1
|
)%
|
|
3.6550
|
|
|
3.1928
|
|
|
3.4904
|
|
|
(13
|
)%
|
|
9
|
%
|
British pound
|
1.2760
|
|
|
1.3521
|
|
|
1.2357
|
|
|
(6
|
)%
|
|
9
|
%
|
|
1.3350
|
|
|
1.2889
|
|
|
1.3554
|
|
|
4
|
%
|
|
(5
|
)%
|
Canadian dollar
|
0.7331
|
|
|
0.7953
|
|
|
0.7439
|
|
|
(8
|
)%
|
|
7
|
%
|
|
0.7718
|
|
|
0.7711
|
|
|
0.7555
|
|
|
—
|
%
|
|
2
|
%
|
1.
|
Based on U.S. dollar to Brazilian real.
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
Change
|
|
|||
Australian dollar
|
$
|
(629
|
)
|
|
$
|
406
|
|
|
$
|
(1,035
|
)
|
Brazilian real
|
(2,162
|
)
|
|
(506
|
)
|
|
(1,656
|
)
|
|||
British pound
|
(539
|
)
|
|
768
|
|
|
(1,307
|
)
|
|||
Canadian dollar
|
(644
|
)
|
|
752
|
|
|
(1,396
|
)
|
|||
Other
|
(714
|
)
|
|
662
|
|
|
(1,376
|
)
|
|||
Total cumulative translation adjustments
|
(4,688
|
)
|
|
2,082
|
|
|
(6,770
|
)
|
|||
Currency hedges
1
|
1,365
|
|
|
(1,643
|
)
|
|
3,008
|
|
|||
Total cumulative translation adjustments net of currency hedges
|
$
|
(3,323
|
)
|
|
$
|
439
|
|
|
$
|
(3,762
|
)
|
Attributable to:
|
|
|
|
|
|
||||||
Shareholders
|
$
|
(959
|
)
|
|
$
|
280
|
|
|
$
|
(1,239
|
)
|
Non-controlling interests
|
(2,364
|
)
|
|
159
|
|
|
(2,523
|
)
|
|||
|
$
|
(3,323
|
)
|
|
$
|
439
|
|
|
$
|
(3,762
|
)
|
1.
|
Net of deferred income tax expense of $69 million.
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||
FOR THE PERIODS ENDED
(MILLIONS, EXCEPT PER SHARE AMOUNTS) |
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
||||||||
Revenues
1
|
$
|
16,006
|
|
|
$
|
14,858
|
|
|
$
|
13,276
|
|
|
$
|
12,631
|
|
|
$
|
13,065
|
|
|
$
|
12,276
|
|
|
$
|
9,444
|
|
|
$
|
6,001
|
|
Net income
|
3,028
|
|
|
941
|
|
|
1,664
|
|
|
1,855
|
|
|
2,083
|
|
|
992
|
|
|
958
|
|
|
518
|
|
||||||||
Net income (loss) to shareholders
|
1,884
|
|
|
163
|
|
|
680
|
|
|
857
|
|
|
1,046
|
|
|
228
|
|
|
225
|
|
|
(37
|
)
|
||||||||
Per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
– diluted
|
$
|
1.87
|
|
|
$
|
0.11
|
|
|
$
|
0.62
|
|
|
$
|
0.84
|
|
|
$
|
1.02
|
|
|
$
|
0.20
|
|
|
$
|
0.19
|
|
|
$
|
(0.08
|
)
|
– basic
|
1.91
|
|
|
0.11
|
|
|
0.64
|
|
|
0.85
|
|
|
1.05
|
|
|
0.20
|
|
|
0.20
|
|
|
(0.08
|
)
|
1.
|
2017 revenues have not been restated as we adopted IFRS 15 using the modified retrospective method as at January 1, 2018.
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||
FOR THE PERIODS ENDED
(MILLIONS) |
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
||||||||
Fair value changes
|
$
|
257
|
|
|
$
|
132
|
|
|
$
|
833
|
|
|
$
|
572
|
|
|
$
|
280
|
|
|
$
|
132
|
|
|
$
|
213
|
|
|
$
|
(204
|
)
|
Income taxes
|
884
|
|
|
(144
|
)
|
|
(339
|
)
|
|
(153
|
)
|
|
(110
|
)
|
|
(259
|
)
|
|
(119
|
)
|
|
(125
|
)
|
||||||||
Net impact
|
$
|
1,141
|
|
|
$
|
(12
|
)
|
|
$
|
494
|
|
|
$
|
419
|
|
|
$
|
170
|
|
|
$
|
(127
|
)
|
|
$
|
94
|
|
|
$
|
(329
|
)
|
•
|
The increase in revenues in the fourth quarter of 2018 is due primarily to recent acquisitions, including a full quarter of revenues from GGP following the privatization, as well as the impact of same-store growth across the business. Consolidated net income is higher than prior period due to gains on sales of businesses, fair value valuation gains on investment properties and a deferred tax recovery in our Corporate segment. These increases were partially offset by higher interest expense from new borrowings to fund acquisitions and debts assumed from acquired businesses.
|
•
|
Revenues increased in the third quarter primarily due to recent acquisitions across all segments, including the privatization of GGP, and same-store growth, in particular improved pricing at our graphite electrode manufacturing business. Higher interest and depreciation expenses associated with recent acquisitions, and the recognition of a deferred tax expense associated with the GGP privatization, more than offset the increase in revenues.
|
•
|
The increase in revenues in the second quarter of 2018 is primarily attributable to recent acquisitions, additional home closings in our North American residential business and improved pricing at our graphite electrodes manufacturing business. Increases in direct costs offset these changes in revenue. While net income also benefited from strong performance at Norbord and valuation and transaction-related gains in our Real Estate segment, results were more than offset by higher income tax expenses and the absence of a one-time gain recognized on the sale of a business in the first quarter.
|
•
|
In the first quarter of 2018, revenues decreased due to the seasonality of our residential homebuilding and construction services businesses, partially offset by a full quarter of revenues contributed by recent acquisitions in our Renewable Power segment. Net income benefited from investment property valuation gains and other fair value gains recognized in the current quarter.
|
•
|
The increase in revenues in the fourth quarter of 2017 is attributable to same-store growth in existing operations across our business and acquisitions throughout the year. Net income benefited from gains from the sale of the European logistics company and from
a change in basis of accounting for Norbord.
|
•
|
Revenues in the third quarter of 2017 increased as a result of incremental contributions from acquisitions made partway through the second quarter of 2017, as described below, that have now contributed to a full quarter. Current quarter acquisitions also added to the increase, namely the acquisition of a fuel marketing business in our Private Equity segment. Results were partially offset by higher income tax expenses in the quarter.
|
•
|
The overall increase in results in the second quarter of 2017 is predominantly attributab
le to acquisitions completed in the quarter, including the regulated gas transmission operation and the leading water treatment business, both in Brazil and the U.K. road fuel distribution business.
|
•
|
In the first quarter of 2017, we recorded fair value losses, predominantly driven by mark-to-market losses on the GGP warrants, as well as decreases in valuations in our core office portfolio. Revenue declined from the prior quarter due to seasonality in the residential business.
|
|
Distribution per Security
|
||||||||||
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Class A and B
1
Limited Voting Shares (“Class A and B shares”)
|
$
|
0.60
|
|
|
$
|
0.56
|
|
|
$
|
0.52
|
|
Special distribution to Class A and B shares
2,3
|
—
|
|
|
0.11
|
|
|
0.45
|
|
|||
Class A Preferred Shares
|
|
|
|
|
|
||||||
Series 2
|
0.48
|
|
|
0.39
|
|
|
0.36
|
|
|||
Series 4
|
0.48
|
|
|
0.39
|
|
|
0.36
|
|
|||
Series 8
|
0.68
|
|
|
0.55
|
|
|
0.48
|
|
|||
Series 9
|
0.53
|
|
|
0.53
|
|
|
0.75
|
|
|||
Series 13
|
0.48
|
|
|
0.39
|
|
|
0.36
|
|
|||
Series 14
4
|
—
|
|
|
—
|
|
|
0.11
|
|
|||
Series 15
|
0.40
|
|
|
0.28
|
|
|
0.23
|
|
|||
Series 17
|
0.92
|
|
|
0.92
|
|
|
0.90
|
|
|||
Series 18
|
0.92
|
|
|
0.92
|
|
|
0.90
|
|
|||
Series 24
5
|
0.58
|
|
|
0.58
|
|
|
0.80
|
|
|||
Series 25
5
|
0.68
|
|
|
0.56
|
|
|
0.27
|
|
|||
Series 26
6
|
0.67
|
|
|
0.72
|
|
|
0.85
|
|
|||
Series 28
7
|
0.53
|
|
|
0.70
|
|
|
0.87
|
|
|||
Series 30
8
|
0.90
|
|
|
0.93
|
|
|
0.90
|
|
|||
Series 32
9
|
0.89
|
|
|
0.87
|
|
|
0.85
|
|
|||
Series 34
|
0.81
|
|
|
0.81
|
|
|
0.80
|
|
|||
Series 36
|
0.94
|
|
|
0.94
|
|
|
0.92
|
|
|||
Series 37
|
0.95
|
|
|
0.95
|
|
|
0.92
|
|
|||
Series 38
|
0.85
|
|
|
0.85
|
|
|
0.83
|
|
|||
Series 40
|
0.87
|
|
|
0.87
|
|
|
0.85
|
|
|||
Series 42
|
0.87
|
|
|
0.87
|
|
|
0.85
|
|
|||
Series 44
|
0.96
|
|
|
0.97
|
|
|
0.94
|
|
|||
Series 46
10
|
0.93
|
|
|
1.03
|
|
|
—
|
|
|||
Series 48
11
|
0.92
|
|
|
0.28
|
|
|
—
|
|
1.
|
Class B Limited Voting Shares (“Class B shares”).
|
2.
|
Distribution of one common share of Trisura Group Ltd. for every 170 Class A Shares and Class B Shares held as of the close of business of June 1, 2017.
|
3.
|
Distribution of a 20.7% interest in Brookfield Business Partners on June 20, 2016, based on IFRS values.
|
4.
|
Redeemed March 1, 2016.
|
5.
|
1,533,133 shares were converted from Series 24 to Series 25 on July 1, 2016.
|
6.
|
Dividend rate reset commenced March 31, 2017.
|
7.
|
Dividend rate reset commenced June 30, 2017.
|
8.
|
Dividend rate reset commenced December 31, 2017.
|
9.
|
Dividend rate reset commenced September 30, 2018.
|
10.
|
Issued November 18, 2016.
|
11.
|
Issued September 13, 2017.
|
i.
|
Asset management
operations include managing our listed partnerships, private funds and public securities on behalf of our investors and ourselves. We generate contractual base management fees for these activities as well as incentive distributions and performance income, including performance fees, transaction fees and carried interest. Common equity in our asset management segment is immaterial.
|
ii.
|
Real estate
operations include the ownership, operation and development of core office, core retail, LP investments and other properties.
|
iii.
|
Renewable power
operations include the ownership, operation and development of hydroelectric, wind, solar, storage and other power generating facilities.
|
iv.
|
Infrastructure
operations include the ownership, operation and development of utilities, transport, energy, data infrastructure and sustainable resource assets.
|
v.
|
Private equity
operations include a broad range of industries, and are mostly focused on business services, infrastructure services and industrial operations.
|
vi.
|
Residential development
operations consist of homebuilding, condominium development and land development.
|
vii.
|
Corporate activities
include the investment of cash and financial assets, as well as the management of our corporate leverage, including corporate borrowings and preferred equity, which fund a portion of the capital invested in our other operations. Certain corporate costs such as technology and operations are incurred on behalf of our operating segments and allocated to each operating segment based on an internal pricing framework.
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Revenues
1
|
|
FFO
2
|
|
Common Equity
|
||||||||||||||||||||||||||||||
2018
|
|
|
2017
|
|
|
Change
|
|
2018
|
|
|
2017
|
|
|
Change
|
|
2018
|
|
|
2017
|
|
|
Change
|
|||||||||||||
Asset Management
|
$
|
1,947
|
|
|
$
|
1,467
|
|
|
$
|
480
|
|
|
$
|
1,317
|
|
|
$
|
970
|
|
|
$
|
347
|
|
|
$
|
328
|
|
|
$
|
312
|
|
|
$
|
16
|
|
Real Estate
|
8,116
|
|
|
6,862
|
|
|
1,254
|
|
|
1,786
|
|
|
2,004
|
|
|
(218
|
)
|
|
17,423
|
|
|
16,725
|
|
|
698
|
|
|||||||||
Renewable Power
|
3,762
|
|
|
2,788
|
|
|
974
|
|
|
328
|
|
|
270
|
|
|
58
|
|
|
5,302
|
|
|
4,944
|
|
|
358
|
|
|||||||||
Infrastructure
|
5,018
|
|
|
3,871
|
|
|
1,147
|
|
|
602
|
|
|
345
|
|
|
257
|
|
|
2,887
|
|
|
2,834
|
|
|
53
|
|
|||||||||
Private Equity
|
37,270
|
|
|
24,577
|
|
|
12,693
|
|
|
795
|
|
|
333
|
|
|
462
|
|
|
4,279
|
|
|
4,215
|
|
|
64
|
|
|||||||||
Residential Development
|
2,683
|
|
|
2,447
|
|
|
236
|
|
|
49
|
|
|
34
|
|
|
15
|
|
|
2,606
|
|
|
2,915
|
|
|
(309
|
)
|
|||||||||
Corporate Activities
|
188
|
|
|
362
|
|
|
(174
|
)
|
|
(476
|
)
|
|
(146
|
)
|
|
(330
|
)
|
|
(7,178
|
)
|
|
(7,893
|
)
|
|
715
|
|
|||||||||
Total
|
$
|
58,984
|
|
|
$
|
42,374
|
|
|
$
|
16,610
|
|
|
$
|
4,401
|
|
|
$
|
3,810
|
|
|
$
|
591
|
|
|
$
|
25,647
|
|
|
$
|
24,052
|
|
|
$
|
1,595
|
|
1.
|
Revenues include inter-segment revenues which are adjusted to arrive at external revenues for IFRS purposes. Please refer to Note 3(c) of the consolidated financial statements.
|
2.
|
Total FFO is a non-IFRS measure – see definition in Glossary of Terms beginning on page
108
.
|
•
|
recent acquisitions across all business groups, in particular a road fuel distribution business and a service provider to the power generation industry in our Private Equity segment; the step-up acquisition of GGP in our Real Estate segment; a Colombian gas commercialization and distribution business and
one of North America’s leading providers of essential residential energy infrastructure in our Infrastructure segment; and portfolios of wind and solar assets in our Renewable Power segment
; and
|
•
|
same-store growth, including the impact of improved pricing in our graphite electrode manufacturing business and same-property leasing growth in our core office properties; partially offset by
|
•
|
the absence of revenues from Norbord which was consolidated up until the fourth quarter of 2017 at which time we sold a partial interest and therefore no longer hold a controlling interest in the business.
|
•
|
continued expansion of our asset management activities, with significant increases in fee bearing capital resulting in higher management fees;
|
•
|
strong market performance by BBU resulting in higher performance fees earned; and
|
•
|
contributions from recent acquisitions and same-store growth as described above; partially offset by
|
•
|
the impact of foreign exchange.
|
•
|
We manage
$138 billion
of fee bearing capital, including
$70 billion
in private funds,
$54 billion
in listed partnerships and
$13 billion
within our public securities group. We earn recurring long-term fee revenues from this fee bearing capital, in the form of:
|
◦
|
Long-term, diversified base management fee revenues from third party capital in our closed-end and long-life funds and perpetual fee revenues based on the total capitalization of our listed partnerships;
|
◦
|
Incentive distributions from BIP, BEP and BPY, all of which have exceeded pre-determined thresholds; and
|
◦
|
Performance fees, linked to the unit price performance of BBU and other transaction and advisory fees.
|
•
|
Included within our private fund fee bearing capital is
$58 billion
of carry eligible capital. We earn carried interest from this capital when fund performance achieves its preferred return, allowing us to receive a portion of fund profits returned to investors. We recognize this carried interest once it is no longer subject to claw-back.
|
Fee Bearing Capital
1
AS AT DEC. 31 (BILLIONS)
|
|
Fee Related Earnings
1
FOR THE YEARS ENDED DEC. 31 (MILLIONS)
|
|
|
|
|
|
|
Carry Eligible Capital
1
AS AT DEC. 31 (BILLIONS)
|
|
Accumulated Unrealized Carried Interest
1
AS AT DEC. 31 (MILLIONS)
|
|
|
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
•
|
We manage our fee bearing capital through 42 active private funds across our major asset classes: real estate, infrastructure/renewable power and private equity. These funds include core, credit, value-add and opportunistic closed-end funds and core, core plus and credit long-life funds. These are primarily invested in the equity of private companies, although in certain cases, are invested in publicly traded equities. Our credit strategies invest in debt of companies in our areas of focus.
|
•
|
We refer to our largest private fund series as our flagship funds. We have flagship funds within each of our major asset classes: Real Estate (BSREP series), Infrastructure (BIF series, which includes infrastructure and renewable power investments) and Private Equity (BCP series).
|
•
|
Closed-end private fund capital is typically committed for 10 years from the inception of the fund with two one-year extension options.
|
•
|
Long-life private funds are perpetual vehicles that are able to continually raise capital as new investments arise.
|
•
|
We are compensated for managing these private funds through base management fees, which are generally determined on committed capital during the investment period and invested capital thereafter. We are entitled to receive carried interest on these funds, which represents a portion of fund profits above a preferred return to investors.
|
•
|
We manage fee bearing capital through publicly listed perpetual capital entities, including BPY, BEP, BIP, BBU, TERP and Acadian.
|
•
|
We are compensated for managing these entities through (i) base management fees, which are primarily determined by the market capitalization of these entities; and (ii) incentive distributions or performance fees.
|
•
|
Incentive distributions for BPY, BEP, BIP, TERP and Acadian are a portion of the increases in distributions above predetermined hurdles. Performance fees for BBU are based on increases in the unit price of BBU above an escalating threshold.
|
•
|
We manage our fee bearing capital through numerous funds and separately managed accounts, focused on fixed income and equity securities.
|
•
|
We act as advisor and sub-advisor, earning both base and performance fees.
|
AS AT DEC. 31
(MILLIONS) |
Private Funds
|
|
|
Listed
Partnerships
|
|
|
Public
Securities
|
|
|
Total 2018
|
|
|
Total 2017
|
|
|||||
Real estate
|
$
|
33,737
|
|
|
$
|
19,916
|
|
|
$
|
—
|
|
|
$
|
53,653
|
|
|
$
|
41,636
|
|
Renewable power
|
7,595
|
|
|
13,824
|
|
|
—
|
|
|
21,419
|
|
|
23,930
|
|
|||||
Infrastructure
|
17,766
|
|
|
15,946
|
|
|
—
|
|
|
33,712
|
|
|
38,751
|
|
|||||
Private equity
|
10,714
|
|
|
4,653
|
|
|
—
|
|
|
15,367
|
|
|
8,618
|
|
|||||
Diversified
|
—
|
|
|
—
|
|
|
13,377
|
|
|
13,377
|
|
|
12,655
|
|
|||||
December 31, 2018
|
$
|
69,812
|
|
|
$
|
54,339
|
|
|
$
|
13,377
|
|
|
$
|
137,528
|
|
|
n/a
|
|
|
December 31, 2017
|
$
|
52,375
|
|
|
$
|
60,560
|
|
|
$
|
12,655
|
|
|
n/a
|
|
|
$
|
125,590
|
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Private Funds
|
|
|
Listed
Partnerships
|
|
|
Public
Securities
|
|
|
Total
|
|
||||
Balance, December 31, 2017
|
$
|
52,375
|
|
|
$
|
60,560
|
|
|
$
|
12,655
|
|
|
$
|
125,590
|
|
Inflows
|
21,832
|
|
|
8,660
|
|
|
4,458
|
|
|
34,950
|
|
||||
Outflows
|
—
|
|
|
—
|
|
|
(6,045
|
)
|
|
(6,045
|
)
|
||||
Distributions
|
(4,035
|
)
|
|
(4,422
|
)
|
|
—
|
|
|
(8,457
|
)
|
||||
Market valuation
|
247
|
|
|
(9,970
|
)
|
|
(1,716
|
)
|
|
(11,439
|
)
|
||||
Other
|
(607
|
)
|
|
(489
|
)
|
|
4,025
|
|
|
2,929
|
|
||||
Change
|
17,437
|
|
|
(6,221
|
)
|
|
722
|
|
|
11,938
|
|
||||
Balance, December 31, 2018
|
$
|
69,812
|
|
|
$
|
54,339
|
|
|
$
|
13,377
|
|
|
$
|
137,528
|
|
•
|
$21.8 billion
of inflows, including $8.2 billion of commitments to our third flagship real estate fund, $4.2 billion to our fifth flagship private equity funds, $2.1 billion to our long-life strategies and $1.2 billion to our other credit and multifamily strategies, as well as $6.1 billion to co-investments; partially offset by
|
•
|
$4.0 billion
of distributions and capital returned during the year.
|
•
|
$8.7 billion
of inflows, including $5.7 billion related to the BPY and BPR capital issued as a result of the GGP privatization (BAM is entitled to earn incentive distributions on the units issued as part of the transaction effective on the closing date but has agreed to a one-year management fee holiday on this capital). Additional inflows included $3.0 billion of debt and/or preferred equity issued at BIP, BEP and BPY; more than offset by
|
•
|
$4.4 billion
of distributions to unitholders; and
|
•
|
lower unit prices across each of the listed partnerships, which were impacted by market volatility late in 2018 (unit prices improved in early 2019 as markets recovered from the declines seen in December).
|
•
|
$4.5 billion
of inflows, including $1.0 billion in new managed accounts and subscriptions into our energy and real estate mutual funds, as well as additional inflows from retail and institutional investors; and
|
•
|
$4.0 billion
due to the acquisition of an energy and infrastructure investment advisor; partially offset by
|
•
|
$6.0 billion
of redemptions, including investor reallocations out of infrastructure funds due in part to recent volatility within the infrastructure market; and
|
•
|
$1.7 billion
decrease in market value of investments across our public securities funds due to market volatility noted above.
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Fee revenues
|
|
|
|
||||
Base management fees
|
$
|
1,195
|
|
|
$
|
1,048
|
|
Incentive distributions
|
206
|
|
|
151
|
|
||
Performance fees
|
278
|
|
|
142
|
|
||
Transaction and advisory fees
|
14
|
|
|
27
|
|
||
|
1,693
|
|
|
1,368
|
|
||
Direct costs and other
|
(564
|
)
|
|
(472
|
)
|
||
Fee related earnings
|
$
|
1,129
|
|
|
$
|
896
|
|
•
|
Base management fees of
$1.2 billion
in the year include fees earned from our private funds, listed partnerships and public securities businesses. The increase of
$147 million
is due to:
|
◦
|
$133 million increase in private funds fees due to capital raised during late 2017 and 2018; and
|
◦
|
$32 million
of public securities fee revenues from an energy and infrastructure investment advisor acquired in the first quarter of 2018; partially offset by
|
◦
|
$18 million
decline in listed partnership fees due to lower unit prices across the listed partnerships.
|
•
|
Incentive distributions from BIP, BEP and BPY increased by
$55 million
to
$206 million
, a
36%
increase from
2017
. The growth represents our share as manager of increases in per unit distributions by BIP, BEP and BPY of 8%, 5% and 7%, respectively, as well as the impact of equity issued by BIP and BEP.
|
•
|
Performance fees of
$278 million
represent fees earned from BBU and are calculated on an escalating threshold as 20% of the quarterly average unit price over the previous threshold. The current threshold is $41.96.
|
•
|
Direct costs and other consist primarily of employee expenses and professional fees, as well as business related technology costs and other shared services. Direct costs increased by
$92 million
year over year as we continue to build out our organization to manage the aforementioned growth in fee bearing capital.
|
|
2018
|
|
2017
|
||||||||||||||||||||
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Unrealized
Carried
Interest
|
|
|
Direct
Costs
|
|
|
Net
|
|
|
Unrealized
Carried Interest |
|
|
Direct
Costs |
|
|
Net
|
|
||||||
Accumulated unrealized, beginning of year
|
$
|
2,079
|
|
|
$
|
(649
|
)
|
|
$
|
1,430
|
|
|
$
|
898
|
|
|
$
|
(322
|
)
|
|
$
|
576
|
|
In-period change
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unrealized in period
|
802
|
|
|
(202
|
)
|
|
600
|
|
|
1,279
|
|
|
(348
|
)
|
|
931
|
|
||||||
Foreign currency revaluation
|
(141
|
)
|
|
31
|
|
|
(110
|
)
|
|
1
|
|
|
(4
|
)
|
|
(3
|
)
|
||||||
|
661
|
|
|
(171
|
)
|
|
490
|
|
|
1,280
|
|
|
(352
|
)
|
|
928
|
|
||||||
Less: realized
|
(254
|
)
|
|
66
|
|
|
(188
|
)
|
|
(99
|
)
|
|
25
|
|
|
(74
|
)
|
||||||
|
407
|
|
|
(105
|
)
|
|
302
|
|
|
1,181
|
|
|
(327
|
)
|
|
854
|
|
||||||
Accumulated unrealized, end of year
|
$
|
2,486
|
|
|
$
|
(754
|
)
|
|
$
|
1,732
|
|
|
$
|
2,079
|
|
|
$
|
(649
|
)
|
|
$
|
1,430
|
|
•
|
We own and operate real estate assets primarily through a 54
%
(51% fully diluted) economic ownership interest in BPY and a 27.5% interest in a portfolio of operating and development assets in New York.
|
•
|
BPY is listed on the Nasdaq and Toronto Stock Exchange and had a market capitalization of $17.1 billion as at
December 31, 2018
.
|
•
|
BPY owns real estate assets directly as well as through private funds that we manage.
|
•
|
We own interests in and operate Class A office assets in gateway markets around the globe, consisting of 142 premier properties totaling 96 million square feet of office space.
|
•
|
The properties are located primarily in the world’s leading commercial markets such as New York, London, Los Angeles, Washington, D.C., Sydney, Toronto and Berlin.
|
•
|
We also develop properties on a selective basis; active development projects consist of seven office and eight multifamily sites, totaling 10 million square feet.
|
•
|
We own interests in and operate 124 best-in-class malls and urban retail properties in the United States, totaling 121 million square feet.
|
•
|
Our portfolio consists of 100 of the top 500 malls in the United States.
|
•
|
Our retail mall portfolio has a development and redevelopment pipeline that exceeds $1 billion of development costs on a proportionate basis.
|
•
|
We own and operate global portfolios of real estate investments through our opportunistic real estate funds, which are targeted to achieve higher returns than our core office and core retail portfolios.
|
•
|
We invest in mispriced portfolios and/or properties with significant value-add opportunities.
|
•
|
Our LP Investments portfolios consist of high-quality assets with operational upside across the multifamily, triple net lease, hospitality, office, retail, mixed-use, self-storage, manufactured housing and student housing sectors.
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
|
|
Revenues
|
|
FFO
|
|
Common Equity
|
||||||||||||||||||
Ref.
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|||||||
Brookfield Property Partners
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Equity units
1
|
i
|
|
$
|
7,164
|
|
|
$
|
6,012
|
|
|
$
|
736
|
|
|
$
|
668
|
|
|
$
|
15,160
|
|
|
$
|
15,388
|
|
Preferred shares
|
|
|
64
|
|
|
76
|
|
|
64
|
|
|
76
|
|
|
435
|
|
|
1,265
|
|
||||||
|
|
|
7,228
|
|
|
6,088
|
|
|
800
|
|
|
744
|
|
|
15,595
|
|
|
16,653
|
|
||||||
Other real estate investments
|
|
|
888
|
|
|
774
|
|
|
47
|
|
|
36
|
|
|
1,828
|
|
|
72
|
|
||||||
Realized disposition gains
|
ii
|
|
—
|
|
|
—
|
|
|
939
|
|
|
1,224
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
$
|
8,116
|
|
|
$
|
6,862
|
|
|
$
|
1,786
|
|
|
$
|
2,004
|
|
|
$
|
17,423
|
|
|
$
|
16,725
|
|
1.
|
Brookfield’s equity units in BPY consist of 432.6 million redemption-exchange units, 81.7 million Class A limited partnership units, 4.8 million special limited partnership units, 0.1 million general partnership units, and 3.0 million BPR Class A shares, together representing an effective economic interest
2
of 54% of BPY.
|
2.
|
See “Economic ownership interest” in the Glossary of Terms beginning on page
108
.
|
•
|
On August 28, 2018, BPY completed the privatization of GGP, previously a 34%-owned equity accounted investment, and began consolidating its results.
|
◦
|
A new publicly traded entity, BPR, was formed and issued 161 million BPR Class A shares to former GGP shareholders as consideration. As BPR shareholders are entitled to an economic return equivalent to that of BPY unitholders, BPR Class A shares are treated as a separate class of BPY equity.
|
◦
|
Consideration paid to GGP’s shareholders also included 88 million newly issued BPY LP units. In addition, BAM acquired 21 million BPY LP units on conversion of its $500 million Class C preferred shares. As a result of these transactions, BAM’s effective ownership of BPY was reduced from 69% to 53%.
|
◦
|
BPR’s results are included in BPY’s core retail operations. For the first eight months of the year, BPY picked-up its 34% share of GGP’s results and we reported our 69% share of BPY’s FFO. Beginning in September, BPR is incorporated into BPY’s consolidated results. After accounting for the impact of BAM’s purchases of BPY shares in the fourth quarter, we now own 54% of the combined entity.
|
•
|
During the second half of the year, BPY sold 27.5% of its interest in a portfolio of operating and development assets in New York to BAM for net cash proceeds of $1.4 billion. We expect to syndicate out our interest to third-party investors in the near term. Our share of this portfolio of assets’ FFO and common equity are included in “other real estate investments.”
|
•
|
the aforementioned privatization of GGP, previously an equity-accounted investment. BPR’s results are included in BPY’s consolidated results beginning August 28th; and
|
•
|
same-property growth throughout our portfolio; partially offset by
|
•
|
the absence of revenues and FFO from assets sold in the year; and
|
•
|
incremental one-time contributions in the prior year from settlement gains related to historic legal disputes and ancillary revenue from condominium sales.
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Core office
|
$
|
608
|
|
|
$
|
592
|
|
Core retail
|
651
|
|
|
515
|
|
||
LP Investments
1
|
330
|
|
|
335
|
|
||
Corporate
1
|
(410
|
)
|
|
(425
|
)
|
||
Attributable to unitholders
|
1,179
|
|
|
1,017
|
|
||
Non-controlling interests
|
(444
|
)
|
|
(322
|
)
|
||
Segment reallocation and other
2
|
1
|
|
|
(27
|
)
|
||
Brookfield’s interest
|
$
|
736
|
|
|
$
|
668
|
|
1.
|
BPY realigned its segments during the year. Comparative figures have been restated to conform with the new segment presentation.
|
2.
|
Reflects fee related earnings and net carried interest reclassified to the Asset Management segment as well as current taxes related to disposition gains.
|
•
|
the incremental contributions from BPR on a consolidated basis beginning August 28th, after the aforementioned privatization of GGP; partially offset by
|
•
|
the absence of FFO from properties sold, which were greater than the incremental contributions from businesses acquired in the year.
|
•
|
the absence of FFO from assets sold, namely the sale of our European logistics portfolio in the fourth quarter of 2017 and a portfolio of self-storage properties in the third quarter of 2018; was partially offset by
|
•
|
income earned on the sales of merchant build assets in our multifamily portfolio; and
|
•
|
same-property growth at existing portfolio assets.
|
ii.
|
Realized Disposition Gains
|
•
|
interests in certain core retail properties to joint-venture partners for realized gains of $246 million prior to the privatization of GGP in the third quarter;
|
•
|
full or partial interests of a number of core office properties throughout Canada, U.S. and Australia, for a total of $410 million, including the sale of 50% of a building in downtown Toronto for $161 million and our interest in an office property in Denver for a $73 million net gain; and
|
•
|
numerous LP investments, including our interest in a U.S. logistics portfolio for realized gains of
$135 million
and
a portfolio of self-storage assets for gains of
$36 million
.
|
•
|
the acquisition of our 27.5% interest in a portfolio of operating and development assets in New York added $1.4 billion to the period end common equity in the directly held investments; partially offset by
|
•
|
attribution of a portion of our common equity to non-controlling interests resulting from a dilution loss on the change in our effective ownership of BPY to 54%.
|
•
|
We own and operate renewable power assets primarily through a
61%
ownership interest in BEP, which is listed on the New York and Toronto Stock Exchanges and had a market capitalization of $8.1 billion at
December 31, 2018
.
|
•
|
BEP owns one of the world’s largest publicly traded renewable power portfolios.
|
•
|
We own, operate and invest in 218 hydroelectric generating stations on 82 river systems in North America, Brazil and Colombia. Our hydroelectric operations have 7,906 megawatts (“MW”) of installed capacity and long-term average (“LTA”)
1
generation of 20,033 gigawatt hours (“GWh”) on a proportionate basis.
|
•
|
Our wind operations include 106 wind facilities globally with 4,448 MW of installed capacity and LTA generation of 5,372 GWh on a proportionate basis.
|
•
|
Our solar operations include 545 solar facilities globally with 1,787 MW of installed capacity and 974 GWh of LTA generation on a proportionate basis.
|
•
|
Our storage operations have 2,698 MW of installed capacity at four pumped storage facilities in North America and Europe.
|
•
|
We purchase a portion of BEP’s power generated in North America (predominantly in New York) pursuant to a long-term contract at predetermined prices, thereby increasing the stability of BEP’s revenue profile.
|
•
|
We sell the power into the open market and also earn ancillary revenues, such as capacity fees and renewable power credits and premiums. This provides us with increased participation in future increases or decreases in power prices.
|
•
|
We substantially transferred our North American energy marketing function (formerly Brookfield Energy Marketing Inc., or BEMI) to BEP on October 31, 2018 along with our long-term power contract in Ontario. BEP will assume all the benefits of the contract, some of which previously accrued to us. This transfer was paid for by a reduction of the price paid to BEP on the New York contract which we continue to hold. Under the New York contract, we are required to purchase power that BEP generates at certain of its New York assets at a fixed price. Based on LTA, we will purchase approximately 3,600 GWh of power each year. The fixed price that we are required to pay BEP will gradually step down over time resulting in an approximate $20/MWh reduction by 2026 until the contract expiry in 2046. Refer to Part 5 of this MD&A for additional information.
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
|
|
Revenues
|
|
FFO
|
|
Common Equity
|
|||||||||||||||||||
Ref.
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|||||||
Brookfield Renewable Partners
1
|
i
|
|
$
|
3,864
|
|
|
$
|
2,826
|
|
|
$
|
381
|
|
|
$
|
336
|
|
|
$
|
4,749
|
|
|
$
|
4,143
|
|
Energy contracts
2
|
ii
|
|
(102
|
)
|
|
(38
|
)
|
|
(91
|
)
|
|
(76
|
)
|
|
553
|
|
|
801
|
|
||||||
Realized disposition gains
|
iii
|
|
—
|
|
|
—
|
|
|
38
|
|
|
10
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
$
|
3,762
|
|
|
$
|
2,788
|
|
|
$
|
328
|
|
|
$
|
270
|
|
|
$
|
5,302
|
|
|
$
|
4,944
|
|
1.
|
Brookfield’s interest in BEP consists of 129.7 million redemption-exchange units, 56.1 million Class A limited partnership units and 2.7 million general partnership units; together representing an economic interest of
61%
of BEP. Segment revenues at BEP include $840 million (2017 – $147 million) revenue from TERP.
|
2.
|
Known as Brookfield Energy Marketing prior to the internalization of the function by BEP effective October 31, 2018. Refer to Reference ii below for more information.
|
i.
|
Brookfield Renewable Partners
|
1.
|
Proportionate to BEP; refer to definition of
Proportionate basis generation
in Glossary of Terms beginning on page
108
.
|
2.
|
Includes incentive distributions paid to Brookfield of
$40 million
(
2017
–
$30 million
) as the general partner of BEP.
|
3.
|
Segment reallocation refers to disposition gains, net of NCI, included in BEP’s operating FFO that we reclassify to realized disposition gains. This allows us to present FFO attributable to unitholders on the same basis as BEP.
|
•
|
a $43 million decrease in North American FFO as generation was 5% below the prior year (3% above LTA). This decrease was partially offset by cost reduction initiatives; and
|
•
|
the impact of unfavorable foreign exchange at our Brazilian operations which more than offset contributions from stronger generation and higher average revenue per MWh due to re-contracting initiatives, leading to a decrease in FFO of $6 million compared to the prior year; partially offset by
|
•
|
an increase of $34 million in our Colombian business as revenue per MWh increased by 23% attributable to inflation indexation, renegotiation efforts of certain of our power purchase agreements, higher market prices and cost reduction initiatives, slightly offset by lower generation.
|
•
|
a full year of contributions from wind assets acquired as part of the TERP and TerraForm Global businesses in the fourth quarter of 2017 and a portfolio of European wind assets acquired in the second quarter of 2018; and
|
•
|
contributions from our recently commissioned development projects and improved realized pricing from re-contracting initiatives; partially offset by
|
•
|
a decrease in foreign exchange rates in Brazil and lower same-store generation across our European and Brazilian portfolios.
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
ii.
|
Energy Contracts
|
iii.
|
Realized Disposition Gains
|
•
|
We own and operate infrastructure assets primarily through our
30%
economic ownership interest in BIP, which is listed on the New York and Toronto Stock Exchanges and had a market capitalization of $13.8 billion at
December 31, 2018
.
|
•
|
BIP is one of the largest globally diversified owners and operators of infrastructure in the world.
|
•
|
We also have direct investments in sustainable resource operations.
|
•
|
Our regulated transmission business includes ~2,000 km of natural gas pipelines in Brazil, ~2,200 km of transmission lines in North and South America
1
, and ~2,700 km of greenfield electricity transmission under development in South America.
|
•
|
We own and operate 6.6 million connections, predominantly electricity and natural gas connections, and approximately 1.1 million smart meters in our regulated distribution business.
|
•
|
Our regulated terminal operations includes ~85 million tons per annum of coal handling capacity.
|
•
|
These businesses typically generate long-term returns on a regulated or contractual asset base which increase with capital we invest to upgrade and/or expand our systems.
|
•
|
We operate ~5,500 km of railroad track in Western Australia and ~4,800 km of railroad track in South America.
|
•
|
Our toll road operations include ~4,200 km of motorways in Brazil, Chile, Peru and India.
|
•
|
Our ports operations include 37 terminals in North America, the U.K., Australia and across Europe.
|
•
|
These operations are comprised of networks that provide transportation for freight, bulk commodities and passengers, for which we are paid an access fee. This includes businesses with price ceilings as a result of regulation, such as our rail and toll road operations, as well as unregulated businesses, such as our ports.
|
•
|
We own and operate ~15,000 km of natural gas transmission pipelines, primarily in the U.S., and 600 billion cubic feet of natural gas storage in the U.S. and Canada.
|
•
|
In our district energy business we deliver ~3.4 million pounds per hour of heating and 336,000 tons of cooling capacity, as well as servicing ~24,900 natural gas, water and wastewater connections.
|
•
|
These operations are comprised of businesses, typically unregulated or subject to price ceilings, that provide energy transmission and storage services, with profitability based on the volume and price achieved for the provision of these services.
|
•
|
We own and operate ~7,000 multi-purpose communication towers and active rooftop sites and 5,500 km of fiber backbone located in France.
|
•
|
In our data storage business, we manage 33 data centers with ~1.3 million square feet of raised floors and 103 MW of critical load capacity.
|
•
|
These businesses provide essential services and critical infrastructure to media broadcasting and telecom sectors and are secured by long-term inflation-linked contracts.
|
1.
|
On March 15, 2018 we sold ~10,700 km of regulated transmission lines in South America.
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
|
|
Revenues
|
|
FFO
|
|
Common Equity
|
||||||||||||||||||
Ref.
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|||||||
Brookfield Infrastructure Partners
1
|
i
|
|
$
|
4,752
|
|
|
$
|
3,625
|
|
|
$
|
327
|
|
|
$
|
316
|
|
|
$
|
1,916
|
|
|
$
|
2,098
|
|
Sustainable resources and other
|
ii
|
|
266
|
|
|
246
|
|
|
31
|
|
|
29
|
|
|
971
|
|
|
736
|
|
||||||
Realized disposition gains
|
iii
|
|
—
|
|
|
—
|
|
|
244
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
$
|
5,018
|
|
|
$
|
3,871
|
|
|
$
|
602
|
|
|
$
|
345
|
|
|
$
|
2,887
|
|
|
$
|
2,834
|
|
1.
|
Brookfield’s interest in BIP consists of 115.8 million redemption-exchange units, 0.2 million limited partnership units and 1.6 million general partnership units together representing an economic interest of 30% of BIP.
|
i.
|
Brookfield Infrastructure Partners
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Utilities
|
$
|
576
|
|
|
$
|
610
|
|
Transport
|
518
|
|
|
532
|
|
||
Energy
|
269
|
|
|
209
|
|
||
Data infrastructure
|
77
|
|
|
76
|
|
||
Corporate
|
(209
|
)
|
|
(257
|
)
|
||
Attributable to unitholders
|
1,231
|
|
|
1,170
|
|
||
Non-controlling interests and other
1
|
(904
|
)
|
|
(854
|
)
|
||
Brookfield’s interest
|
$
|
327
|
|
|
$
|
316
|
|
1.
|
Includes incentive distributions paid to Brookfield of
$136 million
(
2017
–
$113 million
) as the general partner of BIP.
|
•
|
the impact of the sale of our Chilean electricity transmission business in the first quarter of 2018;
|
•
|
increased borrowing costs from the issuance of debt by our Brazilian regulated gas transmission business; and
|
•
|
the impact of lower foreign exchange rates; partially offset by
|
•
|
a full year of contributions from our Brazilian regulated gas transmission business, acquired during the second quarter of 2017; and
|
•
|
5% same-store growth on a constant currency basis, primarily due to strong connection activity at our U.K. regulated distribution business.
|
•
|
lower ore volumes in our Australian rail business;
|
•
|
the expiry of one of our state concessions in our Brazilian toll road business; and
|
•
|
the impact of lower foreign exchange rates; partially offset by
|
•
|
5% same-store growth on a constant currency basis relating to higher tariffs and initial contributions from our recently acquired toll roads in India.
|
•
|
initial contributions from acquisitions, including our North American residential infrastructure and Canadian natural gas midstream businesses; and
|
•
|
higher transportation volumes from newly secured contracts in our North American natural gas transmission business; partially offset by
|
•
|
lower natural gas price spreads that reduced margins at our gas storage business.
|
•
|
lower base management fees due to lower capitalization values;
|
•
|
lower interest expense due to lower draws on the corporate credit facility; and
|
•
|
higher investment income earned by investing proceeds received from the sale of our Chilean electricity transmission business.
|
ii.
|
Sustainable Resources and Other
|
iii.
|
Realized Disposition Gains
|
•
|
We own and operate private equity assets primarily through our
68%
interest in BBU. BBU is listed on the New York and Toronto Stock Exchanges and had a market capitalization of $3.9 billion at December 31, 2018.
|
•
|
BBU focuses on owning and operating high-quality businesses that benefit from barriers to entry and/or low production costs.
|
•
|
We also own certain businesses directly, including a
42%
interest in Norbord which is one of the world’s largest producers of oriented strand board (“OSB”).
|
•
|
We own and operate a road fuel distribution and marketing business with significant import and storage infrastructure, provide services to residential real estate brokers through franchise arrangements under a number of brands in Canada and facilities management services for corporate and government investors with over 320 million square feet of managed real estate.
|
•
|
We provide contracting services with a focus on high-quality construction of large-scale and complex landmark buildings and social infrastructure. Construction projects are generally delivered through contracts, whereby we take responsibility for design, program, procurement and construction at a defined price. Our backlog currently stands at $8 billion, with a weighted average remaining project life of 1.8 years.
|
•
|
Other operations in our business services include entertainment facilities in the Greater Toronto Area, financial advisory, logistics and wireless broadband.
|
•
|
We are the leading provider of services to the global power generation industry, which includes providing original equipment or technology for approximately 50% of global nuclear capacity and servicing two thirds of the world’s nuclear reactors.
|
•
|
We also provide services to the offshore oil production industry, operating in the North Sea, Canada and Brazil,
|
•
|
Our industrial portfolio is comprised of capital intensive businesses with significant barriers to entry that require technical operating expertise.
|
•
|
We own and operate a leading manufacturer of a broad range of high quality graphite electrodes and a manufacturer of returnable plastics packaging.
|
•
|
We own a water distribution, collection and treatment business which operates through long-term concessions and public-private partnerships, and services 15 million customers in Brazil.
|
•
|
Our mining activities include interests in specialty metal and aggregates mining operations in Canada, including a palladium mine in northern Ontario with ~15,000 tonnes per day of processing capacity.
|
•
|
We own and operate a natural gas exploration and production business, and a contract drilling and well servicing business in western Canada.
|
|
|
Revenues
|
|
FFO
|
|
Common Equity
|
|||||||||||||||||||
Ref.
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|||||||
Brookfield Business Partners
1
|
i
|
|
$
|
36,982
|
|
|
$
|
22,803
|
|
|
$
|
223
|
|
|
$
|
35
|
|
|
$
|
2,017
|
|
|
$
|
2,064
|
|
Norbord
|
ii
|
|
—
|
|
|
1,680
|
|
|
243
|
|
|
219
|
|
|
1,287
|
|
|
1,364
|
|
||||||
Other investments
|
iii
|
|
288
|
|
|
94
|
|
|
34
|
|
|
(3
|
)
|
|
975
|
|
|
787
|
|
||||||
Realized disposition gains
|
iv
|
|
—
|
|
|
—
|
|
|
295
|
|
|
82
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
$
|
37,270
|
|
|
$
|
24,577
|
|
|
$
|
795
|
|
|
$
|
333
|
|
|
$
|
4,279
|
|
|
$
|
4,215
|
|
1.
|
Brookfield’s interest in BBU consists of 63.1 million redemption-exchange units, 24.8 million limited partnership units and eight general partnership units together representing an economic interest of 68% of BBU.
|
•
|
strong performance across multiple operations, particularly improved pricing at our graphite electrode manufacturing business;
|
•
|
contributions from recent acquisitions in 2018, most notably Westinghouse which we acquired in the third quarter of 2018, and a full year of contributions from businesses we acquired during 2017, most notably our service provider to the offshore oil production industry; partially offset by
|
•
|
higher management and performance fees due to increases in BBU’s capitalization value since the prior year.
|
i.
|
Brookfield Business Partners
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Business services
1
|
$
|
131
|
|
|
$
|
92
|
|
Infrastructure services
1
|
195
|
|
|
21
|
|
||
Industrial operations
1
|
470
|
|
|
163
|
|
||
Corporate
|
(63
|
)
|
|
(24
|
)
|
||
Attributable to unitholders
|
733
|
|
|
252
|
|
||
Performance fees
|
(278
|
)
|
|
(142
|
)
|
||
Non-controlling interests
|
(146
|
)
|
|
(25
|
)
|
||
Segment reallocation and other
2
|
(86
|
)
|
|
(50
|
)
|
||
Brookfield’s interest
|
$
|
223
|
|
|
$
|
35
|
|
1.
|
BBU reclassified its segments during the year. Comparative figures have been restated to conform with the new segment presentation.
|
2.
|
Segment reallocation and other refers to disposition gains, net of NCI, included in BBU’s operating FFO that we reclassify to realized disposition gains. This allows us to present FFO attributable to unitholders on the same basis as BBU.
|
•
|
the absence of contributions from our recently sold real estate brokerage services business; and
|
•
|
lower diesel margins at our road fuel distribution business; partially offset by
|
•
|
contributions from acquisitions since the prior year, most notably our entertainment facilities in Ontario.
|
•
|
contributions from new project activities at Westinghouse; and
|
•
|
a full year of contributions from our service provider to the offshore oil production industry, as well as receipt of a one-time customer settlement at this business.
|
ii.
|
Norbord
|
iii.
|
Other Investments
|
iv.
|
Realized Disposition Gains
|
•
|
Our residential development businesses operate predominantly in North America and Brazil.
|
•
|
Our North American business is conducted through Brookfield Residential Properties Inc., is active in 12 principal markets in Canada and the U.S. and controls over 88,000 lots.
|
•
|
Our Brazilian business includes construction, sales and marketing of a broad range of residential and commercial office units, with a primary focus on middle income residential units in Brazil’s largest markets of São Paulo and Rio de Janeiro.
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Revenues
|
|
FFO
|
|
Common Equity
|
||||||||||||||||||
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|||||||
North America
|
$
|
2,213
|
|
|
$
|
2,062
|
|
|
$
|
161
|
|
|
$
|
169
|
|
|
$
|
1,758
|
|
|
$
|
1,711
|
|
Brazil and other
|
470
|
|
|
385
|
|
|
(112
|
)
|
|
(135
|
)
|
|
848
|
|
|
1,204
|
|
||||||
|
$
|
2,683
|
|
|
$
|
2,447
|
|
|
$
|
49
|
|
|
$
|
34
|
|
|
$
|
2,606
|
|
|
$
|
2,915
|
|
•
|
U.S. housing operations’ gross margin improved by $27 million, resulting primarily from a 25% increase in the number of home closings; offset by
|
•
|
A decrease in Canadian housing operations margins of $33 million due to a 14% decrease in the number of home closings compared to the prior year.
|
•
|
improved margins and a one-time gain recognized on sales of completed inventory; and
|
•
|
the impact of foreign exchange, as the weakening of the Brazilian real against the U.S. dollar reduced the deficit; partially offset by
|
•
|
a decrease in the number of units closed compared to the prior year.
|
•
|
Our corporate activities consist of allocating capital to our operating business groups, principally through our listed partnerships (BPY, BEP, BIP and BBU) and directly held investments. We also support the development of new private fund products and can support transactions initiated by our subsidiaries. We fund this capital from free cash flow generation and the issuance of corporate borrowings and preferred shares.
|
•
|
We also hold cash and financial assets as part of our liquidity management operations and enter into financial contracts to manage our foreign currency and interest rate risks.
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Revenues
|
|
FFO
|
|
Common Equity
|
||||||||||||||||||
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|||||||
Corporate cash and financial assets, net
|
$
|
17
|
|
|
$
|
193
|
|
|
$
|
11
|
|
|
$
|
145
|
|
|
$
|
2,275
|
|
|
$
|
2,255
|
|
Corporate borrowings
|
—
|
|
|
—
|
|
|
(323
|
)
|
|
(261
|
)
|
|
(6,409
|
)
|
|
(5,659
|
)
|
||||||
Preferred equity
1
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,168
|
)
|
|
(4,192
|
)
|
||||||
Other corporate investments
|
171
|
|
|
169
|
|
|
(1
|
)
|
|
9
|
|
|
43
|
|
|
41
|
|
||||||
Corporate costs and taxes/net working capital
|
—
|
|
|
—
|
|
|
(163
|
)
|
|
(39
|
)
|
|
1,081
|
|
|
(338
|
)
|
||||||
|
$
|
188
|
|
|
$
|
362
|
|
|
$
|
(476
|
)
|
|
$
|
(146
|
)
|
|
$
|
(7,178
|
)
|
|
$
|
(7,893
|
)
|
1.
|
FFO excludes preferred share distributions of
$151 million
(2017 –
$145 million
).
|
|
|
|
Corporate
|
|
Consolidated
|
|
Our Share
|
||||||||||||||||||
AS AT DEC. 31
(MILLIONS) |
Ref.
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||||
Corporate borrowings
|
i
|
|
$
|
6,409
|
|
|
$
|
5,659
|
|
|
$
|
6,409
|
|
|
$
|
5,659
|
|
|
$
|
6,409
|
|
|
$
|
5,659
|
|
Non-recourse borrowings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Subsidiary borrowings
|
i
|
|
—
|
|
|
—
|
|
|
8,600
|
|
|
63,721
|
|
|
5,174
|
|
|
5,711
|
|
||||||
Property-specific borrowings
|
i
|
|
—
|
|
|
—
|
|
|
103,209
|
|
|
9,009
|
|
|
35,943
|
|
|
30,210
|
|
||||||
|
|
|
6,409
|
|
|
5,659
|
|
|
118,218
|
|
|
78,389
|
|
|
47,526
|
|
|
41,580
|
|
||||||
Accounts payable and other
|
|
|
2,299
|
|
|
2,140
|
|
|
23,989
|
|
|
17,965
|
|
|
10,297
|
|
|
10,880
|
|
||||||
Deferred income tax liabilities
|
|
|
197
|
|
|
160
|
|
|
12,236
|
|
|
11,409
|
|
|
4,425
|
|
|
5,204
|
|
||||||
Subsidiary equity obligations
|
|
|
—
|
|
|
—
|
|
|
3,876
|
|
|
3,661
|
|
|
1,658
|
|
|
1,648
|
|
||||||
Liabilities associated with assets classified as held for sale
|
|
|
—
|
|
|
—
|
|
|
812
|
|
|
1,424
|
|
|
262
|
|
|
703
|
|
||||||
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-controlling interests
|
|
|
—
|
|
|
—
|
|
|
67,335
|
|
|
51,628
|
|
|
—
|
|
|
—
|
|
||||||
Preferred equity
|
ii
|
|
4,168
|
|
|
4,192
|
|
|
4,168
|
|
|
4,192
|
|
|
4,168
|
|
|
4,192
|
|
||||||
Common equity
|
iii
|
|
25,647
|
|
|
24,052
|
|
|
25,647
|
|
|
24,052
|
|
|
25,647
|
|
|
24,052
|
|
||||||
|
|
|
29,815
|
|
|
28,244
|
|
|
97,150
|
|
|
79,872
|
|
|
29,815
|
|
|
28,244
|
|
||||||
Total capitalization
|
|
|
$
|
38,720
|
|
|
$
|
36,203
|
|
|
$
|
256,281
|
|
|
$
|
192,720
|
|
|
$
|
93,983
|
|
|
$
|
88,259
|
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
|
Average Rate
|
|
Average Term (Years)
|
|
Consolidated
|
||||||||||||
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
2018
|
|
2017
|
|
2018
|
|
|
2017
|
|
||
Term debt
|
4.5
|
%
|
|
4.6
|
%
|
|
10
|
|
10
|
|
$
|
6,450
|
|
|
$
|
5,594
|
|
Revolving facilities
|
—
|
%
|
|
1.6
|
%
|
|
4
|
|
4
|
|
—
|
|
|
103
|
|
||
Deferred financing costs
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
n/a
|
|
(41
|
)
|
|
(38
|
)
|
||
Total
|
|
|
|
|
|
|
|
|
$
|
6,409
|
|
|
$
|
5,659
|
|
AS AT DEC. 31
(MILLIONS) |
Average Rate
|
|
Average Term
|
|
Consolidated
|
||||||||||||||
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|||
Real estate
|
4.7
|
%
|
|
4.4
|
%
|
|
4
|
|
|
4
|
|
|
$
|
63,494
|
|
|
$
|
37,235
|
|
Renewable power
|
5.4
|
%
|
|
5.9
|
%
|
|
10
|
|
|
9
|
|
|
14,233
|
|
|
14,230
|
|
||
Infrastructure
|
5.2
|
%
|
|
4.7
|
%
|
|
6
|
|
|
8
|
|
|
14,334
|
|
|
9,010
|
|
||
Private equity and other
|
6.2
|
%
|
|
6.7
|
%
|
|
6
|
|
|
6
|
|
|
10,820
|
|
|
2,898
|
|
||
Residential development
|
8.0
|
%
|
|
9.6
|
%
|
|
2
|
|
|
2
|
|
|
328
|
|
|
348
|
|
||
Total
|
5.0
|
%
|
|
4.9
|
%
|
|
6
|
|
|
6
|
|
|
$
|
103,209
|
|
|
$
|
63,721
|
|
Fixed Rate
|
|
Floating Rate
|
|||||||||||||||||||||||||
2018
|
|
2017
|
|
2018
|
|
2017
|
|||||||||||||||||||||
Average Rate
|
|
|
Consolidated
|
|
|
Average Rate
|
|
|
Consolidated
|
|
|
Average Rate
|
|
|
Consolidated
|
|
|
Average Rate
|
|
|
Consolidated
|
|
|||||
Corporate borrowings
|
4.5
|
%
|
|
$
|
6,409
|
|
|
4.6
|
%
|
|
$
|
5,556
|
|
|
—
|
%
|
|
$
|
—
|
|
|
1.6
|
%
|
|
$
|
103
|
|
Subsidiary borrowings
|
4.8
|
%
|
|
5,296
|
|
|
4.8
|
%
|
|
4,800
|
|
|
4.0
|
%
|
|
3,304
|
|
|
3.2
|
%
|
|
4,209
|
|
||||
Property-specific borrowings
|
4.9
|
%
|
|
39,318
|
|
|
5.0
|
%
|
|
33,106
|
|
|
5.1
|
%
|
|
63,891
|
|
|
4.8
|
%
|
|
30,615
|
|
||||
Total
|
4.9
|
%
|
|
$
|
51,023
|
|
|
5.0
|
%
|
|
$
|
43,462
|
|
|
5.0
|
%
|
|
$
|
67,195
|
|
|
4.6
|
%
|
|
$
|
34,927
|
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
Outstanding at beginning of year
|
958.8
|
|
|
958.2
|
|
Issued (repurchased)
|
|
|
|
||
Repurchases
|
(9.6
|
)
|
|
(3.5
|
)
|
Long-term share ownership plans
1
|
5.7
|
|
|
3.8
|
|
Dividend reinvestment plan and others
|
0.2
|
|
|
0.3
|
|
Outstanding at end of year
|
955.1
|
|
|
958.8
|
|
Unexercised options and other share-based plans
1
|
42.1
|
|
|
47.5
|
|
Total diluted shares at end of year
|
997.2
|
|
|
1,006.3
|
|
1.
|
Includes management share option plan and restricted stock plan.
|
•
|
Cash and financial assets, net of deposits and other associated liabilities; and
|
•
|
Undrawn committed credit facilities.
|
AS AT DEC. 31
(MILLIONS) |
Corporate
|
|
|
Real Estate
|
|
|
Renewable Power
|
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Total
2018 |
|
|
2017
|
|
|||||||
Cash and financial assets, net
|
$
|
2,275
|
|
|
$
|
65
|
|
|
$
|
286
|
|
|
$
|
238
|
|
|
$
|
888
|
|
|
$
|
3,752
|
|
|
$
|
3,218
|
|
Undrawn committed credit facilities
|
1,867
|
|
|
1,980
|
|
|
971
|
|
|
1,418
|
|
|
825
|
|
|
7,061
|
|
|
4,839
|
|
|||||||
Core liquidity
|
4,142
|
|
|
2,045
|
|
|
1,257
|
|
|
1,656
|
|
|
1,713
|
|
|
10,813
|
|
|
8,057
|
|
|||||||
Uncalled private fund commitments
|
—
|
|
|
12,326
|
|
|
1,302
|
|
|
3,788
|
|
|
6,159
|
|
|
23,575
|
|
|
18,591
|
|
|||||||
Total liquidity
|
$
|
4,142
|
|
|
$
|
14,371
|
|
|
$
|
2,559
|
|
|
$
|
5,444
|
|
|
$
|
7,872
|
|
|
$
|
34,388
|
|
|
$
|
26,648
|
|
1.
|
See definition in Glossary of Terms beginning on page
108
.
|
•
|
Fee related earnings from our asset management activities and proceeds in the form of realized carried interest from asset sales within private funds.
|
•
|
Distributions from invested capital, in particular our listed partnerships.
|
•
|
Other invested capital earnings: comprised of our wholly-owned investments offset by corporate interest expense, corporate costs and taxes and dividends paid on preferred shares.
|
•
|
$1.1 billion
fee related earnings;
|
•
|
$188 million
realized carried interest, net;
|
•
|
$1.7 billion
of distributions from our listed partnerships and other investments; partially offset by
|
•
|
other invested capital earnings, including preferred share dividends paid, which resulted in expenses of $596 million.
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
1) Asset management FFO
|
|
|
|
||||
Fee revenues
|
$
|
1,693
|
|
|
$
|
1,368
|
|
Direct costs
|
(564
|
)
|
|
(472
|
)
|
||
Fee related earnings
|
1,129
|
|
|
896
|
|
||
Realized carried interest
|
188
|
|
|
74
|
|
||
|
1,317
|
|
|
970
|
|
||
2) Distributions from investments
|
|
|
|
||||
Listed partnerships
|
1,339
|
|
|
1,218
|
|
||
Corporate cash and financial assets
|
156
|
|
|
75
|
|
||
Other investments
|
203
|
|
|
58
|
|
||
|
1,698
|
|
|
1,351
|
|
||
3) Other invested capital earnings
|
|
|
|
||||
Corporate borrowings
|
(323
|
)
|
|
(261
|
)
|
||
Corporate costs and taxes
|
(163
|
)
|
|
(39
|
)
|
||
Other wholly owned investments
|
41
|
|
|
23
|
|
||
|
(445
|
)
|
|
(277
|
)
|
||
Preferred share dividends
|
(151
|
)
|
|
(145
|
)
|
||
Cash available for distribution and/or reinvestment
|
$
|
2,419
|
|
|
$
|
1,899
|
|
AS AT AND FOR THE YEAR ENDED DEC. 31, 2018
(MILLIONS, EXCEPT PER UNIT AMOUNTS) |
Ownership %
|
|
|
Brookfield Owned Units
|
|
|
Distributions
Per Unit
1
|
|
|
Quoted Value
2
|
|
|
Distributions (Current Rate)
3
|
|
|
Distributions (Actual)
|
|
||||
Distributions from investments
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Listed partnerships
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Brookfield Property Partners
4
|
54
|
%
|
|
522.3
|
|
|
$
|
1.32
|
|
|
$
|
8,855
|
|
|
$
|
729
|
|
|
$
|
725
|
|
Brookfield Renewable Partners
|
61
|
%
|
|
188.4
|
|
|
2.06
|
|
|
4,879
|
|
|
388
|
|
|
370
|
|
||||
Brookfield Infrastructure Partners
|
30
|
%
|
|
117.7
|
|
|
2.01
|
|
|
4,063
|
|
|
237
|
|
|
222
|
|
||||
Brookfield Business Partners
|
68
|
%
|
|
87.9
|
|
|
0.25
|
|
|
2,671
|
|
|
22
|
|
|
22
|
|
||||
|
|
|
|
|
|
|
|
|
1,376
|
|
|
1,339
|
|
||||||||
Corporate cash and financial assets
5
|
various
|
|
|
various
|
|
|
various
|
|
|
2,275
|
|
|
218
|
|
|
156
|
|
||||
Other investments
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Norbord
6
|
42
|
%
|
|
34.8
|
|
|
1.17
|
|
|
925
|
|
|
41
|
|
|
167
|
|
||||
Other
7
|
various
|
|
|
various
|
|
|
various
|
|
|
various
|
|
|
62
|
|
|
36
|
|
||||
|
|
|
|
|
|
|
|
|
103
|
|
|
203
|
|
||||||||
Total
|
$
|
1,697
|
|
|
$
|
1,698
|
|
1.
|
Based on current distribution policies.
|
2.
|
Quoted value represents the value of Brookfield owned units as at market close on December 31, 2018.
|
3.
|
Distributions (current rate) are calculated by multiplying units held as at
December 31, 2018
by distributions per unit. Actual dividends may differ due to timing of dividend increases and payment of special dividends, which are not factored into the current rate calculation. See definition in Glossary of Terms beginning on page
108
.
|
4.
|
BPY’s quoted value includes
$435 million
of preferred shares. Fully diluted ownership is 51%, assuming conversion of convertible preferred shares held by a third party. BPY’s distributions include
$64 million
of preferred share dividends received by the Corporation.
|
5.
|
Includes cash and cash equivalents and financial assets net of deposits.
|
6.
|
Actual distribution received from Norbord in 2018 was higher than distributions at the current rate due to a C$4.50/share special dividend paid in the third quarter.
|
7.
|
Other includes cash distributions from Acadian and from our 27.5% interest in a BAM-sponsored real estate venture in New York.
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Operating activities
|
$
|
5,159
|
|
|
$
|
4,005
|
|
Financing activities
|
18,136
|
|
|
8,185
|
|
||
Investing activities
|
(19,833
|
)
|
|
(11,394
|
)
|
||
Change in cash and cash equivalents
|
$
|
3,462
|
|
|
$
|
796
|
|
|
Payments Due by Period
|
||||||||||||||||||
AS AT DEC. 31, 2018
(MILLIONS)
|
Less than 1 Year
|
|
|
1 – 3
Years
|
|
|
4 – 5
Years
|
|
|
After 5
Years
|
|
|
Total
|
|
|||||
Recourse Obligations
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate borrowings
|
$
|
440
|
|
|
$
|
257
|
|
|
$
|
441
|
|
|
$
|
5,271
|
|
|
$
|
6,409
|
|
Accounts payable and other
|
1,044
|
|
|
198
|
|
|
14
|
|
|
1,043
|
|
|
2,299
|
|
|||||
Interest expense
1
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate borrowings
|
278
|
|
|
535
|
|
|
504
|
|
|
1,697
|
|
|
3,014
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Non-recourse Obligations
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal repayments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Non-recourse borrowings of managed entities
|
|
|
|
|
|
|
|
|
|
||||||||||
Property-specific borrowings
|
10,764
|
|
|
30,892
|
|
|
22,527
|
|
|
39,026
|
|
|
103,209
|
|
|||||
Subsidiary borrowings
|
395
|
|
|
3,163
|
|
|
2,106
|
|
|
2,936
|
|
|
8,600
|
|
|||||
Subsidiary equity obligations
|
185
|
|
|
1,417
|
|
|
356
|
|
|
1,918
|
|
|
3,876
|
|
|||||
Accounts payable and other
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital lease obligations
|
25
|
|
|
51
|
|
|
28
|
|
|
145
|
|
|
249
|
|
|||||
Accounts payable and other
|
13,293
|
|
|
2,758
|
|
|
1,330
|
|
|
4,060
|
|
|
21,441
|
|
|||||
Commitments
|
1,395
|
|
|
1,117
|
|
|
215
|
|
|
356
|
|
|
3,083
|
|
|||||
Operating leases
|
516
|
|
|
834
|
|
|
661
|
|
|
7,823
|
|
|
9,834
|
|
|||||
Interest expense
1,2
|
|
|
|
|
|
|
|
|
|
||||||||||
Non-recourse borrowings
|
5,126
|
|
|
8,124
|
|
|
5,820
|
|
|
7,324
|
|
|
26,394
|
|
|||||
Subsidiary equity obligations
|
151
|
|
|
307
|
|
|
218
|
|
|
209
|
|
|
885
|
|
1.
|
Represents the aggregate interest expense expected to be paid over the term of the obligations.
|
2.
|
Variable interest rate payments have been calculated based on current rates.
|
i.
|
Investment Properties
|
|
Core Office
|
|
Core Retail
1
|
|
LP Investments
and Other
|
|
Weighted Average
|
|||||||||||||||
AS AT DEC. 31
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
Discount rate
|
6.8
|
%
|
|
6.9
|
%
|
|
7.1
|
%
|
|
n/a
|
|
7.5
|
%
|
|
7.3
|
%
|
|
7.2
|
%
|
|
7.1
|
%
|
Terminal capitalization rate
|
5.7
|
%
|
|
5.8
|
%
|
|
6.0
|
%
|
|
n/a
|
|
6.9
|
%
|
|
7.0
|
%
|
|
6.1
|
%
|
|
6.2
|
%
|
Investment horizon (years)
|
11
|
|
|
11
|
|
|
12
|
|
|
n/a
|
|
8
|
|
|
9
|
|
|
10
|
|
|
10
|
|
1.
|
After obtaining control of GGP on August 28, 2018, we are now consolidating multiple investment properties in our core retail operations. Please see Note 5 of the consolidated financial statements for additional information.
|
AS AT DEC. 31, 2018
(MILLIONS) |
Fair Value
|
|
Sensitivity
|
|
|||
Core office
|
|
|
|
||||
United States
|
$
|
15,237
|
|
|
$
|
837
|
|
Canada
|
4,245
|
|
|
329
|
|
||
Australia
|
2,391
|
|
|
201
|
|
||
Europe
|
1,331
|
|
|
—
|
|
||
Brazil
|
329
|
|
|
10
|
|
||
Core retail
|
17,607
|
|
|
612
|
|
||
LP Investments and other
|
|
|
|
||||
LP Investments office
|
8,438
|
|
|
517
|
|
||
LP Investments retail
|
3,414
|
|
|
143
|
|
||
Logistics
|
183
|
|
|
8
|
|
||
Mixed-use
|
12,086
|
|
|
140
|
|
||
Multifamily
|
4,151
|
|
|
255
|
|
||
Triple net lease
|
5,067
|
|
|
176
|
|
||
Self-storage
|
931
|
|
|
30
|
|
||
Student housing
|
2,417
|
|
|
82
|
|
||
Manufactured housing
|
2,369
|
|
|
104
|
|
||
Other investment properties
|
4,113
|
|
|
220
|
|
||
Total
|
$
|
84,309
|
|
|
$
|
3,664
|
|
ii.
|
Revaluation Method for PP&E
|
•
|
To determine estimated future energy pricing, we consider the contract pricing for the proportion of our revenue that is subject to power purchase agreements. Long-term pricing is driven by the economics required to support new entrants into the various power markets in which we operate. Our long-term view is anchored to the cost of securing new energy from renewable sources to meet future demand growth by the year 2025 in North America and Colombia, 2023 in Europe and 2022 in Brazil. The year of new entry is viewed as the point when generators must build additional capacity to maintain system reliability and provide an adequate level of reserve generation with the retirement of older coal-fired plants and rising environmental compliance costs in North America and Europe, and overall increasing demand in Colombia and Brazil. Once the year of new entrant is determined, data from industry sources, as well as inputs from our development teams, is used to model the all-in cost of the expected technology mix of new construction, and the resulting market price required to support its development. For the North American and European businesses, we have estimated our renewable power assets will contract at discount to new-build wind prices (the most likely source of new renewable generation in those regions). In Brazil and Colombia, the estimate of future electricity prices is based on a similar approach as applied in North America using a forecast of the all-in cost of development. For the remaining pricing, referred to as merchant pricing, we use a mix of external data and our own estimates to derive the price curves.
|
•
|
Short-term merchant revenue forecasts consist of four years of externally sourced broker quotes in North America, two years of gas pricing in Europe and a combination of short-term contracts and local market pricing in South America. Short-term pricing is linked by linear extrapolation to long-term power views.
|
•
|
Energy generation forecasts are based on LTA for which we have significant historical data. LTA for hydroelectric facilities is based on third-party engineering reports commissioned during asset acquisitions and financing activities. These studies are based on statistical models supported by decades of historical river flow data. Similarly, LTA for wind facilities is based on third-party wind resource studies completed prior to construction or acquisition. LTA for solar facilities is based on third-party irradiance level studies at the location of our project sites during construction or acquisition.
|
•
|
Capital expenditure forecasts rely on independent engineering reports commissioned from reputable third-party firms during underwriting or financings.
|
|
North America
|
|
Brazil
|
|
Colombia
|
|
Europe
|
||||||||||||
AS AT DEC. 31
|
2018
|
|
2017
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
2017
|
Discount rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contracted
|
4.8 – 5.6%
|
|
4.9 – 6.0%
|
|
9.0
|
%
|
|
8.9
|
%
|
|
9.6
|
%
|
|
11.3
|
%
|
|
4.0 – 4.3%
|
|
4.1 – 4.5%
|
Uncontracted
|
6.4 – 7.2%
|
|
6.5 – 7.6%
|
|
10.3
|
%
|
|
10.2
|
%
|
|
10.9
|
%
|
|
12.6
|
%
|
|
5.8 – 6.1%
|
|
5.9 – 6.3%
|
Terminal capitalization rate
1
|
6.1 – 7.1%
|
|
6.2 – 7.5%
|
|
n/a
|
|
|
n/a
|
|
|
10.4
|
%
|
|
12.6
|
%
|
|
n/a
|
|
n/a
|
Exit date
|
2039
|
|
2037
|
|
2047
|
|
|
2032
|
|
|
2038
|
|
|
2037
|
|
|
2033
|
|
2031
|
1.
|
The terminal capitalization rate applies only to hydroelectric assets in North America and Colombia.
|
AS AT DEC. 31, 2018
(MILLIONS) |
|
||
25 bps change in discount and terminal capitalization rates
1
|
|
||
North America
|
$
|
1,230
|
|
Colombia
|
215
|
|
|
Brazil
|
80
|
|
|
Europe
|
20
|
|
|
5% change in electricity prices
|
|
||
North America
|
1,150
|
|
|
Colombia
|
440
|
|
|
Brazil
|
100
|
|
|
Europe
|
20
|
|
1.
|
Terminal capitalization rate applies only to hydroelectric assets in North America and Colombia.
|
|
Utilities
|
|
Transport
|
|
Energy
|
|
Data Infrastructure
|
|||||||||||
AS AT DEC. 31
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
Discount rate
|
7 – 14%
|
|
7 – 12%
|
|
10 – 13%
|
|
10 – 15%
|
|
12 – 15%
|
|
|
12 – 15%
|
|
|
13 – 15%
|
|
|
n/a
|
Terminal capitalization multiples
|
8x – 22x
|
|
7x – 21x
|
|
9x – 14x
|
|
9x – 14x
|
|
10x – 14x
|
|
|
8x – 13x
|
|
|
10x – 11x
|
|
|
n/a
|
Investment horizon / Termination valuation date (years)
|
10 – 20
|
|
10 – 20
|
|
10 – 20
|
|
10 – 20
|
|
10
|
|
|
10
|
|
|
10
|
|
|
n/a
|
iii.
|
Sustainable Resources
|
iv.
|
Financial Instruments
|
v.
|
Inventory
|
vi.
|
Other
|
i.
|
Control or Level of Influence
|
ii.
|
Investment Properties
|
iii.
|
Property, Plant and Equipment
|
iv.
|
Identifying Performance Obligations for Revenue Recognition
|
v.
|
Common Control Transactions
|
vi.
|
Indicators of Impairment
|
vii.
|
Income Taxes
|
viii.
|
Classification of Non-Controlling Interests in Limited-Life Funds
|
ix.
|
Other
|
•
|
The
2018
consolidated financial statements accompanied by this MD&A give a true and fair view of the assets, liabilities, financial position, and profit or loss of the company and the undertakings included in the consolidated financial statements taken as whole; and
|
•
|
The management report included in this MD&A gives a true and fair review of the information required under the Dutch Act regarding the company and the undertakings included in the consolidated financial statements taken as a whole as of
December 31, 2018
, and of the development and performance of the business for the financial year then ended.
|
a)
|
Volatility in the Trading Price of Our Class A Shares
|
b)
|
Reputation
|
c)
|
Asset Management
|
d)
|
Laws, Rules and Regulations
|
e)
|
Governmental Investigations and Anti-Bribery and Corruption
|
f)
|
Foreign Exchange and Other Financial Exposures
|
g)
|
Temporary Investments
|
h)
|
Interest Rates
|
i)
|
Financial and Liquidity
|
j)
|
Human Capital
|
k)
|
Geopolitical
|
l)
|
Economic Conditions
|
m)
|
Tax
|
n)
|
Financial Reporting and Disclosures
|
o)
|
Health, Safety and the Environment
|
p)
|
Catastrophic Event/Loss, Climate Change, and Terrorism (including Cyber Terrorism)
|
q)
|
Dependence on Information Technology Systems
|
r)
|
Litigation
|
s)
|
Insurance
|
t)
|
Credit and Counterparty Risk
|
u)
|
Real Estate
|
v)
|
Renewable Power
|
w)
|
Infrastructure
|
x)
|
Private Equity
|
y)
|
Residential Development
|
•
|
We have
42 active funds across major asset classes; real estate, infrastructure/renewable power and private equity.
These funds include core, credit, value-add and opportunistic closed-end funds and core long-life funds. We refer to these funds as our
private funds.
|
•
|
We refer to BPY, BEP, BIP and BBU as our
listed partnerships
.
|
•
|
We refer to our public securities group as
public securities
. This group
manages fee bearing capital through numerous funds and separately managed accounts, focused on fixed income and equity securities.
|
•
|
Acadian
– Acadian Timber Corp.
|
•
|
BBU
– Brookfield Business Partners L.P.
|
•
|
BEMI
– Brookfield Energy Marketing Inc.
|
•
|
BEP
– Brookfield Renewable Partners L.P.
|
•
|
BIP
– Brookfield Infrastructure Partners L.P.
|
•
|
BPY
– Brookfield Property Partners L.P.
|
•
|
BPR
– Brookfield Property REIT Inc. (formerly GGP Inc.)
|
•
|
GGP
– GGP Inc.
|
•
|
Norbord
– Norbord Inc.
|
•
|
TerraForm Power (“TERP”)
– TerraForm Power, Inc.
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Total consolidated liabilities and equity
|
$
|
256,281
|
|
|
$
|
192,720
|
|
Add: our share of debt of investments in associates
|
9,533
|
|
|
10,875
|
|
||
Less: non-controlling interests’ share of liabilities
|
|
|
|
||||
Non-recourse borrowings
|
(80,225
|
)
|
|
(47,684
|
)
|
||
Liabilities associated with assets held for sale
|
(550
|
)
|
|
(606
|
)
|
||
Accounts payable and other
|
(13,692
|
)
|
|
(7,200
|
)
|
||
Deferred tax liabilities
|
(7,811
|
)
|
|
(6,205
|
)
|
||
Subsidiary equity obligations
|
(2,218
|
)
|
|
(2,013
|
)
|
||
Non-controlling interests
|
(67,335
|
)
|
|
(51,628
|
)
|
||
Total capitalization at our share
|
$
|
93,983
|
|
|
$
|
88,259
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Carry eligible capital
|
$
|
58,309
|
|
|
$
|
42,357
|
|
Less:
|
|
|
|
||||
Uncalled private fund commitments
|
(21,883
|
)
|
|
(18,591
|
)
|
||
Co-investments and other
|
(6,108
|
)
|
|
(2,383
|
)
|
||
Funds not yet at target preferred return
|
(9,442
|
)
|
|
(2,508
|
)
|
||
Adjusted carry eligible capital
|
$
|
20,876
|
|
|
$
|
18,875
|
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Asset management FFO
|
$
|
1,317
|
|
|
$
|
970
|
|
Distributions received from investments
|
1,698
|
|
|
1,351
|
|
||
Other invested capital earnings
|
|
|
|
||||
Corporate borrowings
|
(323
|
)
|
|
(261
|
)
|
||
Corporate costs and taxes
|
(163
|
)
|
|
(39
|
)
|
||
Other wholly-owned investments
|
41
|
|
|
23
|
|
||
|
(445
|
)
|
|
(277
|
)
|
||
Preferred share dividends
|
(151
|
)
|
|
(145
|
)
|
||
Cash available for distribution and/or reinvestment
|
$
|
2,419
|
|
|
$
|
1,899
|
|
•
|
Inflows
include capital commitments and contributions to our private and public securities funds and equity issuances in our listed partnerships.
|
•
|
Outflows
represent distributions and redemptions of capital from within the public securities capital.
|
•
|
Distributions
represent quarterly distributions from listed partnerships as well as returns of committed capital (excluding market valuation adjustments), redemptions and expiry of uncalled commitments within our private funds.
|
•
|
Market activity
includes gains (losses) on portfolio investments, listed partnerships and public securities based on market prices.
|
•
|
Other
include changes in net non-recourse leverage included in the determination of listed partnership capitalization and the impact of foreign exchange fluctuations on non-U.S. dollar commitments.
|
|
Total
|
|
Per Share
|
||||||||||||
FOR THE YEARS ENDED DEC. 31
(MILLIONS, EXCEPT PER SHARE AMOUNTS) |
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Net income
|
$
|
7,488
|
|
|
$
|
4,551
|
|
|
$
|
7.51
|
|
|
$
|
4.50
|
|
Realized disposition gains recorded as fair value changes or equity
|
1,445
|
|
|
1,116
|
|
|
1.48
|
|
|
1.14
|
|
||||
Non-controlling interest in FFO
|
(6,015
|
)
|
|
(4,964
|
)
|
|
(6.15
|
)
|
|
(5.07
|
)
|
||||
Financial statement components not included in FFO
|
|
|
|
|
|
|
|
||||||||
Equity accounted fair value changes and other non-FFO items
|
1,284
|
|
|
856
|
|
|
1.31
|
|
|
0.87
|
|
||||
Fair value changes
|
(1,794
|
)
|
|
(421
|
)
|
|
(1.84
|
)
|
|
(0.43
|
)
|
||||
Depreciation and amortization
|
3,102
|
|
|
2,345
|
|
|
3.17
|
|
|
2.39
|
|
||||
Deferred income taxes
|
(1,109
|
)
|
|
327
|
|
|
(1.13
|
)
|
|
0.34
|
|
||||
Total FFO
|
$
|
4,401
|
|
|
$
|
3,810
|
|
|
$
|
4.35
|
|
|
$
|
3.74
|
|
1.
|
Current rate based on February 2019 announced distribution rates.
|
2.
|
We are also entitled to earn a portion of increases in distributions by TERP, based on distribution hurdles of $0.93 and $1.05. TERP's current annual distribution has not yet reached the first hurdle.
|
AS AT DEC. 31
(MILLIONS) |
Adjusted Carry Eligible Capital
1
|
|
|
Adjusted Multiple of Capital
2
|
|
Fund Target Carried Interest
3
|
|
|
Current Carried Interest
4
|
|
||
2018
|
|
|
|
|
|
|
|
|||||
Real Estate
|
$
|
8,534
|
|
|
1.8x
|
|
20
|
%
|
—
|
|
17
|
%
|
Infrastructure
|
10,022
|
|
|
1.4x
|
|
20
|
%
|
|
17
|
%
|
||
Private Equity
|
2,320
|
|
|
2.5x
|
|
20
|
%
|
|
20
|
%
|
||
|
$
|
20,876
|
|
|
|
|
|
|
|
|||
2017
|
|
|
|
|
|
|
|
|||||
Real Estate
|
$
|
7,542
|
|
|
1.8x
|
|
20%
|
|
|
16
|
%
|
|
Infrastructure
|
9,613
|
|
|
1.4x
|
|
20%
|
|
|
14
|
%
|
||
Private Equity
|
1,720
|
|
|
2.7x
|
|
20%
|
|
|
20
|
%
|
||
|
$
|
18,875
|
|
|
|
|
|
|
|
|||
2016
|
|
|
|
|
|
|
|
|||||
Real Estate
|
$
|
5,376
|
|
|
1.8x
|
|
20%
|
|
|
12
|
%
|
|
Infrastructure
|
5,777
|
|
|
1.4x
|
|
20%
|
|
|
16
|
%
|
||
Private Equity
|
1,321
|
|
|
1.5x
|
|
20%
|
|
|
6
|
%
|
||
|
$
|
12,474
|
|
|
|
|
|
|
|
1.
|
Excludes uncalled private fund commitments, co-investment capital and funds that have not met their preferred return.
|
2.
|
Adjusted Multiple of Capital represents the ratio of total distributions plus estimates of remaining value to the equity invested, and reflects performance net of fund management fees and expenses, before carried interest. Our core, credit and value add funds pay management fees of 0.90 – 1.50% and our opportunistic and private equity funds pay fees of 1.50 – 2.00%. Funds typically incur fund expenses of approximately 0.35% of carry eligible capital annually.
|
3.
|
Fund target carried interest percentage is the target carry average of the funds within adjusted carry eligible capital as at each period end.
|
4.
|
When a fund has achieved its preferred return, we earn an accelerated percentage of the additional fund profit until we have earned the fund target carried interest percentage. Funds in their early stage of earning carry will not yet have earned the full percentage of total fund profit to which we are entitled.
|
1.
|
Carried interest generated is subject to taxes and long-term incentive expenses to investment professionals. These expenses are typically 30 – 35% of carried interest generated.
|
|
|
||||
J. Bruce Flatt
Chief Executive Officer |
|
Brian D. Lawson
Chief Financial Officer |
|
||
|
|
|
|
|
|
March 26, 2019
|
|
|
|
|
|
Toronto, Canada
|
|
|
|
|
|
|
||||
J. Bruce Flatt
Chief Executive Officer |
|
Brian D. Lawson
Chief Financial Officer |
|
||
|
|
|
|
|
|
March 26, 2019
|
|
|
|
|
|
Toronto, Canada
|
|
|
|
|
AS AT DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Assets
|
|
|
|
|
|
||||
Cash and cash equivalents
|
6
|
|
$
|
8,390
|
|
|
$
|
5,139
|
|
Other financial assets
|
6
|
|
6,227
|
|
|
4,800
|
|
||
Accounts receivable and other
|
7
|
|
16,931
|
|
|
11,973
|
|
||
Inventory
|
8
|
|
6,989
|
|
|
6,311
|
|
||
Assets classified as held for sale
|
9
|
|
2,185
|
|
|
1,605
|
|
||
Equity accounted investments
|
10
|
|
33,647
|
|
|
31,994
|
|
||
Investment properties
|
11
|
|
84,309
|
|
|
56,870
|
|
||
Property, plant and equipment
|
12
|
|
67,294
|
|
|
53,005
|
|
||
Intangible assets
|
13
|
|
18,762
|
|
|
14,242
|
|
||
Goodwill
|
14
|
|
8,815
|
|
|
5,317
|
|
||
Deferred income tax assets
|
15
|
|
2,732
|
|
|
1,464
|
|
||
Total Assets
|
|
|
$
|
256,281
|
|
|
$
|
192,720
|
|
|
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
|
|
||||
Corporate borrowings
|
16
|
|
$
|
6,409
|
|
|
$
|
5,659
|
|
Accounts payable and other
|
17
|
|
23,989
|
|
|
17,965
|
|
||
Liabilities associated with assets classified as held for sale
|
9
|
|
812
|
|
|
1,424
|
|
||
Non-recourse borrowings of managed entities
|
18
|
|
111,809
|
|
|
72,730
|
|
||
Deferred income tax liabilities
|
15
|
|
12,236
|
|
|
11,409
|
|
||
Subsidiary equity obligations
|
19
|
|
3,876
|
|
|
3,661
|
|
||
|
|
|
|
|
|
||||
Equity
|
|
|
|
|
|
||||
Preferred equity
|
21
|
|
4,168
|
|
|
4,192
|
|
||
Non-controlling interests
|
21
|
|
67,335
|
|
|
51,628
|
|
||
Common equity
|
21
|
|
25,647
|
|
|
24,052
|
|
||
Total equity
|
|
|
97,150
|
|
|
79,872
|
|
||
Total Liabilities and Equity
|
|
|
$
|
256,281
|
|
|
$
|
192,720
|
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS, EXCEPT PER SHARE AMOUNTS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Revenues
|
22
|
|
$
|
56,771
|
|
|
$
|
40,786
|
|
Direct costs
|
23
|
|
(45,519
|
)
|
|
(32,388
|
)
|
||
Other income and gains
|
|
|
1,166
|
|
|
1,180
|
|
||
Equity accounted income
|
10
|
|
1,088
|
|
|
1,213
|
|
||
Expenses
|
|
|
|
|
|
||||
Interest
|
|
|
(4,854
|
)
|
|
(3,608
|
)
|
||
Corporate costs
|
|
|
(104
|
)
|
|
(95
|
)
|
||
Fair value changes
|
24
|
|
1,794
|
|
|
421
|
|
||
Depreciation and amortization
|
|
|
(3,102
|
)
|
|
(2,345
|
)
|
||
Income taxes
|
15
|
|
248
|
|
|
(613
|
)
|
||
Net income
|
|
|
$
|
7,488
|
|
|
$
|
4,551
|
|
Net income attributable to:
|
|
|
|
|
|
||||
Shareholders
|
|
|
$
|
3,584
|
|
|
$
|
1,462
|
|
Non-controlling interests
|
|
|
3,904
|
|
|
3,089
|
|
||
|
|
|
$
|
7,488
|
|
|
$
|
4,551
|
|
Net income per share:
|
|
|
|
|
|
||||
Diluted
|
21
|
|
$
|
3.40
|
|
|
$
|
1.34
|
|
Basic
|
21
|
|
3.47
|
|
|
1.37
|
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Net income
|
|
|
$
|
7,488
|
|
|
$
|
4,551
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
||||
Items that may be reclassified to net income
|
|
|
|
|
|
||||
Financial contracts and power sale agreements
|
|
|
(20
|
)
|
|
278
|
|
||
Marketable securities
|
|
|
(34
|
)
|
|
95
|
|
||
Equity accounted investments
|
10
|
|
(29
|
)
|
|
6
|
|
||
Foreign currency translation
|
|
|
(3,254
|
)
|
|
439
|
|
||
Income taxes
|
15
|
|
(90
|
)
|
|
11
|
|
||
|
|
|
(3,427
|
)
|
|
829
|
|
||
Items that will not be reclassified to net income
|
|
|
|
|
|
||||
Revaluations of property, plant and equipment
|
12
|
|
6,290
|
|
|
934
|
|
||
Revaluation of pension obligations
|
17
|
|
(19
|
)
|
|
4
|
|
||
Equity accounted investments
|
10
|
|
547
|
|
|
509
|
|
||
Marketable securities
|
|
|
94
|
|
|
—
|
|
||
Income taxes
|
15
|
|
(1,324
|
)
|
|
314
|
|
||
|
|
|
5,588
|
|
|
1,761
|
|
||
Other comprehensive income
|
|
|
2,161
|
|
|
2,590
|
|
||
Comprehensive income
|
|
|
$
|
9,649
|
|
|
$
|
7,141
|
|
Attributable to:
|
|
|
|
|
|
||||
Shareholders
|
|
|
|
|
|
||||
Net income
|
|
|
$
|
3,584
|
|
|
$
|
1,462
|
|
Other comprehensive income
|
|
|
406
|
|
|
849
|
|
||
Comprehensive income
|
|
|
$
|
3,990
|
|
|
$
|
2,311
|
|
|
|
|
|
|
|
||||
Non-controlling interests
|
|
|
|
|
|
||||
Net income
|
|
|
$
|
3,904
|
|
|
$
|
3,089
|
|
Other comprehensive income
|
|
|
1,755
|
|
|
1,741
|
|
||
Comprehensive income
|
|
|
$
|
5,659
|
|
|
$
|
4,830
|
|
|
|
|
|
|
|
|
|
|
Accumulated Other
Comprehensive Income
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
AS AT AND FOR THE YEAR ENDED DEC. 31, 2018 (MILLIONS)
|
Common
Share
Capital
|
|
|
Contributed
Surplus
|
|
|
Retained
Earnings
|
|
|
Ownership
Changes
1
|
|
|
Revaluation
Surplus
|
|
|
Currency
Translation
|
|
|
Other
Reserves
2
|
|
|
Common
Equity
|
|
|
Preferred
Equity
|
|
|
Non-
controlling
Interests
|
|
|
Total
Equity
|
|
|||||||||||
Balance as at
December 31, 2017 |
$
|
4,428
|
|
|
$
|
263
|
|
|
$
|
11,864
|
|
|
$
|
1,459
|
|
|
$
|
6,881
|
|
|
$
|
(878
|
)
|
|
$
|
35
|
|
|
$
|
24,052
|
|
|
$
|
4,192
|
|
|
$
|
51,628
|
|
|
$
|
79,872
|
|
Changes in accounting policies
3
|
—
|
|
|
—
|
|
|
(215
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(218
|
)
|
|
—
|
|
|
(84
|
)
|
|
(302
|
)
|
|||||||||||
Adjusted balance as at January 1, 2018
|
4,428
|
|
|
263
|
|
|
11,649
|
|
|
1,459
|
|
|
6,881
|
|
|
(878
|
)
|
|
32
|
|
|
23,834
|
|
|
4,192
|
|
|
51,544
|
|
|
79,570
|
|
|||||||||||
Changes in period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
3,584
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,584
|
|
|
—
|
|
|
3,904
|
|
|
7,488
|
|
|||||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,060
|
|
|
(959
|
)
|
|
305
|
|
|
406
|
|
|
—
|
|
|
1,755
|
|
|
2,161
|
|
|||||||||||
Comprehensive income
|
—
|
|
|
—
|
|
|
3,584
|
|
|
—
|
|
|
1,060
|
|
|
(959
|
)
|
|
305
|
|
|
3,990
|
|
|
—
|
|
|
5,659
|
|
|
9,649
|
|
|||||||||||
Shareholder distributions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Common equity
|
—
|
|
|
—
|
|
|
(575
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(575
|
)
|
|
—
|
|
|
—
|
|
|
(575
|
)
|
|||||||||||
Preferred equity
|
—
|
|
|
—
|
|
|
(151
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(151
|
)
|
|
—
|
|
|
—
|
|
|
(151
|
)
|
|||||||||||
Non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,709
|
)
|
|
(6,709
|
)
|
|||||||||||
Other items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Equity issuances, net of redemptions
|
29
|
|
|
(44
|
)
|
|
(344
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(359
|
)
|
|
(24
|
)
|
|
6,663
|
|
|
6,280
|
|
|||||||||||
Share-based compensation
|
—
|
|
|
52
|
|
|
(33
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
7
|
|
|
26
|
|
|||||||||||
Ownership changes
|
—
|
|
|
—
|
|
|
114
|
|
|
(814
|
)
|
|
(385
|
)
|
|
4
|
|
|
(30
|
)
|
|
(1,111
|
)
|
|
—
|
|
|
10,171
|
|
|
9,060
|
|
|||||||||||
Total change in period
|
29
|
|
|
8
|
|
|
2,595
|
|
|
(814
|
)
|
|
675
|
|
|
(955
|
)
|
|
275
|
|
|
1,813
|
|
|
(24
|
)
|
|
15,791
|
|
|
17,580
|
|
|||||||||||
Balance as at
December 31, 2018 |
$
|
4,457
|
|
|
$
|
271
|
|
|
$
|
14,244
|
|
|
$
|
645
|
|
|
$
|
7,556
|
|
|
$
|
(1,833
|
)
|
|
$
|
307
|
|
|
$
|
25,647
|
|
|
$
|
4,168
|
|
|
$
|
67,335
|
|
|
$
|
97,150
|
|
1.
|
Includes gains or losses on changes in ownership interests of consolidated subsidiaries.
|
2.
|
Includes changes in fair value of marketable securities, cash flow hedges, actuarial changes on pension plans and equity accounted other comprehensive income, net of associated income taxes.
|
3.
|
See financial statement Note 2(b).
|
|
|
|
|
|
|
|
|
|
Accumulated Other
Comprehensive Income
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
AS AT AND FOR THE YEAR ENDED DEC. 31, 2017 (MILLIONS)
|
Common
Share Capital |
|
|
Contributed
Surplus |
|
|
Retained
Earnings |
|
|
Ownership
Changes 1 |
|
|
Revaluation
Surplus |
|
|
Currency
Translation |
|
|
Other
Reserves 2 |
|
|
Common
Equity |
|
|
Preferred
Equity |
|
|
Non-
controlling Interests |
|
|
Total
Equity |
|
|||||||||||
Balance as at
December 31, 2016 |
$
|
4,390
|
|
|
$
|
234
|
|
|
$
|
11,490
|
|
|
$
|
1,199
|
|
|
$
|
6,750
|
|
|
$
|
(1,256
|
)
|
|
$
|
(308
|
)
|
|
$
|
22,499
|
|
|
$
|
3,954
|
|
|
$
|
43,235
|
|
|
$
|
69,688
|
|
Changes in period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
1,462
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,462
|
|
|
—
|
|
|
3,089
|
|
|
4,551
|
|
|||||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
237
|
|
|
280
|
|
|
332
|
|
|
849
|
|
|
—
|
|
|
1,741
|
|
|
2,590
|
|
|||||||||||
Comprehensive income
|
—
|
|
|
—
|
|
|
1,462
|
|
|
—
|
|
|
237
|
|
|
280
|
|
|
332
|
|
|
2,311
|
|
|
—
|
|
|
4,830
|
|
|
7,141
|
|
|||||||||||
Shareholder distributions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Common equity
|
—
|
|
|
—
|
|
|
(642
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(642
|
)
|
|
—
|
|
|
—
|
|
|
(642
|
)
|
|||||||||||
Preferred equity
|
—
|
|
|
—
|
|
|
(145
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(145
|
)
|
|
—
|
|
|
—
|
|
|
(145
|
)
|
|||||||||||
Non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,907
|
)
|
|
(4,907
|
)
|
|||||||||||
Other items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Equity issuances, net of redemptions
|
38
|
|
|
(23
|
)
|
|
(118
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(103
|
)
|
|
238
|
|
|
7,193
|
|
|
7,328
|
|
|||||||||||
Share-based compensation
|
—
|
|
|
52
|
|
|
(31
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|
4
|
|
|
25
|
|
|||||||||||
Ownership changes
|
—
|
|
|
—
|
|
|
(152
|
)
|
|
260
|
|
|
(106
|
)
|
|
98
|
|
|
11
|
|
|
111
|
|
|
—
|
|
|
1,273
|
|
|
1,384
|
|
|||||||||||
Total change in period
|
38
|
|
|
29
|
|
|
374
|
|
|
260
|
|
|
131
|
|
|
378
|
|
|
343
|
|
|
1,553
|
|
|
238
|
|
|
8,393
|
|
|
10,184
|
|
|||||||||||
Balance as at
December 31, 2017 |
$
|
4,428
|
|
|
$
|
263
|
|
|
$
|
11,864
|
|
|
$
|
1,459
|
|
|
$
|
6,881
|
|
|
$
|
(878
|
)
|
|
$
|
35
|
|
|
$
|
24,052
|
|
|
$
|
4,192
|
|
|
$
|
51,628
|
|
|
$
|
79,872
|
|
1.
|
Includes gains or losses on changes in ownership interests of consolidated subsidiaries.
|
2.
|
Includes changes in fair value of marketable securities, cash flow hedges, actuarial changes on pension plans and equity accounted other comprehensive income, net of associated income taxes.
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Operating activities
|
|
|
|
|
|
||||
Net income
|
|
|
$
|
7,488
|
|
|
$
|
4,551
|
|
Other income and gains
|
|
|
(1,166
|
)
|
|
(1,180
|
)
|
||
Share of undistributed equity accounted earnings
|
|
|
(294
|
)
|
|
(481
|
)
|
||
Fair value changes
|
24
|
|
(1,794
|
)
|
|
(421
|
)
|
||
Depreciation and amortization
|
|
|
3,102
|
|
|
2,345
|
|
||
Deferred income taxes
|
15
|
|
(1,109
|
)
|
|
327
|
|
||
Investments in residential inventory
|
|
|
258
|
|
|
19
|
|
||
Net change in non-cash working capital balances
|
|
|
(1,326
|
)
|
|
(1,155
|
)
|
||
|
|
|
5,159
|
|
|
4,005
|
|
||
Financing activities
|
|
|
|
|
|
||||
Corporate borrowings arranged
|
|
|
1,090
|
|
|
1,284
|
|
||
Corporate borrowings repaid
|
|
|
—
|
|
|
(434
|
)
|
||
Commercial paper and bank borrowings, net
|
|
|
(103
|
)
|
|
103
|
|
||
Non-recourse borrowings arranged
|
|
|
43,541
|
|
|
26,251
|
|
||
Non-recourse borrowings repaid
|
|
|
(28,243
|
)
|
|
(21,636
|
)
|
||
Non-recourse credit facilities, net
|
|
|
3,291
|
|
|
819
|
|
||
Subsidiary equity obligations issued
|
|
|
212
|
|
|
419
|
|
||
Subsidiary equity obligations redeemed
|
|
|
(485
|
)
|
|
(347
|
)
|
||
Capital provided from non-controlling interests
|
|
|
9,306
|
|
|
9,488
|
|
||
Capital repaid to non-controlling interests
|
|
|
(2,643
|
)
|
|
(2,295
|
)
|
||
Preferred equity issuance
|
|
|
—
|
|
|
241
|
|
||
Preferred equity redemptions
|
|
|
(17
|
)
|
|
(7
|
)
|
||
Common shares issued
|
|
|
11
|
|
|
15
|
|
||
Common shares repurchased
|
|
|
(389
|
)
|
|
(124
|
)
|
||
Distributions to non-controlling interests
|
|
|
(6,709
|
)
|
|
(4,907
|
)
|
||
Distributions to shareholders
|
|
|
(726
|
)
|
|
(685
|
)
|
||
|
|
|
18,136
|
|
|
8,185
|
|
||
Investing activities
|
|
|
|
|
|
||||
Acquisitions
|
|
|
|
|
|
||||
Investment properties
|
|
|
(2,879
|
)
|
|
(2,114
|
)
|
||
Property, plant and equipment
|
|
|
(1,962
|
)
|
|
(1,690
|
)
|
||
Equity accounted investments
|
|
|
(953
|
)
|
|
(2,718
|
)
|
||
Financial assets and other
|
|
|
(5,288
|
)
|
|
(4,623
|
)
|
||
Acquisition of subsidiaries
|
|
|
(22,269
|
)
|
|
(10,336
|
)
|
||
Dispositions
|
|
|
|
|
|
||||
Investment properties
|
|
|
4,311
|
|
|
2,906
|
|
||
Property, plant and equipment
|
|
|
787
|
|
|
66
|
|
||
Equity accounted investments
|
|
|
2,163
|
|
|
889
|
|
||
Financial assets and other
|
|
|
4,523
|
|
|
2,843
|
|
||
Disposition of subsidiaries
|
|
|
1,729
|
|
|
2,834
|
|
||
Restricted cash and deposits
|
|
|
5
|
|
|
549
|
|
||
|
|
|
(19,833
|
)
|
|
(11,394
|
)
|
||
Cash and cash equivalents
|
|
|
|
|
|
||||
Change in cash and cash equivalents
|
|
|
3,462
|
|
|
796
|
|
||
Net change in cash classified within assets held for sale
|
|
|
(1
|
)
|
|
(20
|
)
|
||
Foreign exchange revaluation
|
|
|
(210
|
)
|
|
64
|
|
||
Balance, beginning of year
|
|
|
5,139
|
|
|
4,299
|
|
||
Balance, end of year
|
|
|
$
|
8,390
|
|
|
$
|
5,139
|
|
|
|
|
|
|
|
||||
Supplemental cash flow disclosures
|
|
|
|
|
|
||||
Income taxes paid
|
|
|
$
|
980
|
|
|
$
|
402
|
|
Interest paid
|
|
|
4,712
|
|
|
3,374
|
|
1.
|
CORPORATE INFORMATION
|
2.
|
SIGNIFICANT ACCOUNTING POLICIES
|
(MILLIONS)
|
Balance at
December 31, 2017
|
|
|
IFRS 15 Adjustments
|
|
|
Balance at
January 1, 2018
|
|
|||
Assets
|
|
|
|
|
|
||||||
Accounts receivable and other
|
$
|
11,973
|
|
|
$
|
(368
|
)
|
|
$
|
11,605
|
|
Inventory
|
6,311
|
|
|
258
|
|
|
6,569
|
|
|||
Equity accounted investments
|
31,994
|
|
|
(3
|
)
|
|
31,991
|
|
|||
Deferred income tax assets
|
1,464
|
|
|
42
|
|
|
1,506
|
|
|||
Other assets
|
140,978
|
|
|
—
|
|
|
140,978
|
|
|||
Total assets
|
$
|
192,720
|
|
|
$
|
(71
|
)
|
|
$
|
192,649
|
|
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
||||||
Accounts payable and other
|
$
|
17,965
|
|
|
$
|
208
|
|
|
$
|
18,173
|
|
Deferred income tax liabilities
|
11,409
|
|
|
1
|
|
|
11,410
|
|
|||
Other liabilities
|
83,474
|
|
|
—
|
|
|
83,474
|
|
|||
Total liabilities
|
112,848
|
|
|
209
|
|
|
113,057
|
|
|||
|
|
|
|
|
|
||||||
Equity
|
|
|
|
|
|
||||||
Preferred equity
|
4,192
|
|
|
—
|
|
|
4,192
|
|
|||
Non-controlling interests
|
51,628
|
|
|
(83
|
)
|
|
51,545
|
|
|||
Common equity
|
24,052
|
|
|
(197
|
)
|
|
23,855
|
|
|||
Total equity
|
79,872
|
|
|
(280
|
)
|
|
79,592
|
|
|||
Total liabilities and equity
|
$
|
192,720
|
|
|
$
|
(71
|
)
|
|
$
|
192,649
|
|
•
|
within our Private Equity segment, an increase of
$120 million
in the contract work in progress liability and the reduction of
$125 million
of accounts receivable. The impact on opening total equity was
$265 million
. These adjustments were primarily the result of construction contracts for which the cost-to-cost input method was adopted to measure progress towards the satisfaction of performance obligations and for which variable consideration will only be recognized when it is highly probable that revenue from such amounts will not be reversed; and
|
•
|
within our Residential segment, a reduction of
$190 million
of accounts receivable, and increases of
$250 million
in inventory and
$90 million
in deferred revenue. The impact on opening total equity was
$15 million
. These adjustments were primarily the result of our Brazilian residential homebuilding business for which customers have the ability to cancel their contract prior to the transfer of possession and recent legal cases support that control of the asset does not take place until the client takes possession of the unit.
|
•
|
our residential homebuilding business in Brazil, where revenues were
$150 million
higher under IFRS 15 due to the impact on the timing of revenue recognition which resulted in additional units considered sold during 2018; and
|
•
|
our Private Equity segment, which recognized additional revenues of
$91 million
in our construction services business and an incremental
$32 million
in our infrastructure services and industrial operations businesses.
|
•
|
Financial instruments that are not held for the sole purpose of collecting contractual cash flows are classified as FVTPL and are initially recognized at their fair value and are subsequently measured at fair value at each reporting date. Gains and losses recorded on each revaluation date are recognized within net earnings. Transaction costs of financial assets classified as FVTPL are expensed in profit or loss.
|
•
|
Financial assets classified as FVTOCI are initially recognized at their fair value and are subsequently measured at fair value at each reporting date. The cumulative gains or losses related to FVTOCI equity instruments are not reclassified to profit or loss on disposal, whereas the cumulative gains or losses on all other FVTOCI assets are reclassified to profit or loss on disposal,
when there is a significant or prolonged decline in fair value or when the company acquires a controlling or significant interest in the underlying investment and commences equity accounting or consolidating the investment
. The cumulative gains or losses on all FVTOCI liabilities are reclassified to profit or loss on disposal.
|
•
|
Financial instruments that are held for the purpose of collecting contractual cash flows that are solely payments of principal and interest are classified as amortized cost and are initially recognized at their fair value and are subsequently measured at amortized cost using the effective interest rate method. Transaction costs of financial instruments classified as amortized cost are capitalized and amortized in profit or loss on the same basis as the financial instrument.
|
|
|
Measurement
|
||
Financial Instrument Type
|
|
IAS 39
|
|
IFRS 9
|
Financial Assets
|
|
|
|
|
Cash and cash equivalents
|
|
Loans and receivables
|
|
Amortized cost
|
Other financial assets
|
|
|
|
|
Government bonds
|
|
FVTPL, Available for sale
|
|
FVTPL, FVTOCI
|
Corporate bonds
|
|
FVTPL, Available for sale
|
|
FVTPL, FVTOCI
|
Fixed income securities and other
|
|
FVTPL, Available for sale
|
|
FVTPL, FVTOCI
|
Common shares and warrants
|
|
FVTPL, Available for sale
|
|
FVTPL, FVTOCI
|
Loan and notes receivable
|
|
FVTPL, Loans and receivables
|
|
FVTPL, Amortized cost
|
Accounts receivable and other
1
|
|
FVTPL, Loans and receivables
|
|
FVTPL, FVTOCI, Amortized cost
|
|
|
|
|
|
Financial Liabilities
|
|
|
|
|
Corporate borrowings
|
|
Loans and receivables
|
|
Amortized cost
|
Property-specific borrowings
|
|
Loans and receivables
|
|
Amortized cost
|
Subsidiary borrowings
|
|
Loans and receivables
|
|
Amortized cost
|
Accounts payable and other
1
|
|
FVTPL, Loans and receivables
|
|
FVTPL, Amortized cost
|
Subsidiary equity obligations
|
|
FVTPL, Loans and receivables
|
|
FVTPL, Amortized cost
|
1.
|
Includes derivative instruments.
|
f)
|
Cash and Cash Equivalents
|
g)
|
Related Party Transactions
|
h)
|
Operating Assets
|
(YEARS)
|
Useful Lives
|
Dams
|
Up to 115
|
Penstocks
|
Up to 60
|
Powerhouses
|
Up to 115
|
Hydroelectric generating units
|
Up to 115
|
Wind generating units
|
Up to 41
|
Solar generating units
|
Up to 30
|
Other assets
|
Up to 60
|
(YEARS)
|
Useful Lives
|
Buildings
|
Up to 75
|
Transmission stations, towers and related fixtures
|
Up to 40
|
Leasehold improvements
|
Up to 50
|
Plant and equipment
|
Up to 40
|
Network systems
|
Up to 65
|
Track
|
Up to 40
|
District energy systems
|
Up to 50
|
Gas storage assets
|
Up to 50
|
(YEARS)
|
Useful Lives
|
Buildings and improvements
|
Up to 45
|
Equipment and fixtures
|
Up to 20
|
(YEARS)
|
Useful Lives
|
Buildings
|
Up to 50
|
Leasehold improvements
|
Up to 40
|
Machinery and equipment
|
Up to 20
|
Oil and gas related equipment
|
Up to 10
|
Vessels
|
Up to 35
|
i)
|
Fair Value Measurement
|
Level 1 –
|
Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
|
Level 2 –
|
Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the asset or liability’s anticipated life.
|
Level 3 –
|
Inputs are unobservable and reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs in determining the estimate.
|
j)
|
Accounts Receivable
|
k)
|
Intangible Assets
|
(YEARS)
|
Useful Lives
|
Water and sewage concession agreements
|
Up to 40
|
Brand names
|
Up to 20
|
Computer software
|
Up to 10
|
Customer relationships
|
Up to 30
|
Patents and trademarks
|
Up to 40
|
Proprietary technology
|
Up to 15
|
Product development costs
|
Up to 5
|
Distribution networks
|
Up to 25
|
Loyalty program
|
Up to 15
|
l)
|
Goodwill
|
m)
|
Impairment of Long-Lived Assets
|
n)
|
Subsidiary Equity Obligations
|
o)
|
Income Taxes
|
p)
|
Business Combinations
|
q)
|
Other Items
|
r)
|
Critical Estimates and Judgments
|
3.
|
SEGMENTED INFORMATION
|
a)
|
Operating Segments
|
i.
|
Asset management
operations include managing our listed partnerships, private funds and public securities on behalf of our investors and ourselves. We generate contractual base management fees for these activities as well as incentive distributions and performance income, including performance fees, transaction fees and carried interest. Common equity in our asset management segment is immaterial.
|
ii.
|
Real estate
operations include the ownership, operation and development of core office, core retail, LP investments and other properties.
|
iii.
|
Renewable power
operations include the ownership, operation and development of hydroelectric, wind, solar, storage and other power generating facilities.
|
iv.
|
Infrastructure
operations include the ownership, operation and development of utilities, transport, energy, data infrastructure and sustainable resource assets.
|
v.
|
Private equity
operations include a broad range of industries, and are mostly focused on business services, infrastructure services and industrial operations.
|
vi.
|
Residential development
operations consist of homebuilding, condominium development and land development.
|
vii.
|
Corporate activities
include the investment of cash and financial assets, as well as the management of our corporate leverage, including corporate borrowings and preferred equity, which fund a portion of the capital invested in our other operations. Certain corporate costs such as technology and operations are incurred on behalf of our operating segments and allocated to each operating segment based on an internal pricing framework.
|
b)
|
Segment Financial Measures
|
c)
|
Reportable Segment Measures
|
AS AT AND FOR THE YEAR ENDED DEC. 31, 2018
(MILLIONS) |
Asset
Management |
|
|
Real Estate
|
|
|
Renewable
Power |
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Residential Development
|
|
|
Corporate
Activities |
|
|
Total
Segments |
|
|
Note
|
||||||||
External revenues
|
$
|
187
|
|
|
$
|
8,075
|
|
|
$
|
3,751
|
|
|
$
|
5,013
|
|
|
$
|
36,828
|
|
|
$
|
2,683
|
|
|
$
|
234
|
|
|
$
|
56,771
|
|
|
|
Inter-segment revenues
|
1,760
|
|
|
41
|
|
|
11
|
|
|
5
|
|
|
442
|
|
|
—
|
|
|
(46
|
)
|
|
2,213
|
|
|
i
|
||||||||
Segmented revenues
|
1,947
|
|
|
8,116
|
|
|
3,762
|
|
|
5,018
|
|
|
37,270
|
|
|
2,683
|
|
|
188
|
|
|
58,984
|
|
|
|
||||||||
FFO from equity accounted investments
|
—
|
|
|
945
|
|
|
46
|
|
|
846
|
|
|
526
|
|
|
15
|
|
|
(6
|
)
|
|
2,372
|
|
|
ii
|
||||||||
Interest expense
|
—
|
|
|
(2,464
|
)
|
|
(930
|
)
|
|
(586
|
)
|
|
(520
|
)
|
|
(57
|
)
|
|
(323
|
)
|
|
(4,880
|
)
|
|
iii
|
||||||||
Current income taxes
|
—
|
|
|
(213
|
)
|
|
(32
|
)
|
|
(326
|
)
|
|
(186
|
)
|
|
(45
|
)
|
|
(59
|
)
|
|
(861
|
)
|
|
iv
|
||||||||
Funds from operations
|
1,317
|
|
|
1,786
|
|
|
328
|
|
|
602
|
|
|
795
|
|
|
49
|
|
|
(476
|
)
|
|
4,401
|
|
|
v
|
||||||||
Common equity
|
328
|
|
|
17,423
|
|
|
5,302
|
|
|
2,887
|
|
|
4,279
|
|
|
2,606
|
|
|
(7,178
|
)
|
|
25,647
|
|
|
|
||||||||
Equity accounted investments
|
—
|
|
|
22,949
|
|
|
685
|
|
|
7,636
|
|
|
1,943
|
|
|
395
|
|
|
39
|
|
|
33,647
|
|
|
|
||||||||
Additions to non-current assets
1
|
—
|
|
|
51,111
|
|
|
3,729
|
|
|
10,524
|
|
|
10,139
|
|
|
124
|
|
|
190
|
|
|
75,817
|
|
|
|
1.
|
Includes equity accounted investments, investment properties, property, plant and equipment, sustainable resources, intangible assets and goodwill.
|
AS AT AND FOR THE YEAR ENDED DEC. 31, 2017
(MILLIONS) |
Asset
Management |
|
|
Real Estate
|
|
|
Renewable
Power |
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Residential Development
|
|
|
Corporate
Activities |
|
|
Total
Segments |
|
|
Note
|
||||||||
External revenues
|
$
|
286
|
|
|
$
|
6,824
|
|
|
$
|
2,788
|
|
|
$
|
3,859
|
|
|
$
|
24,220
|
|
|
$
|
2,447
|
|
|
$
|
362
|
|
|
$
|
40,786
|
|
|
|
Inter-segment revenues
|
1,181
|
|
|
38
|
|
|
—
|
|
|
12
|
|
|
357
|
|
|
—
|
|
|
—
|
|
|
1,588
|
|
|
i
|
||||||||
Segmented revenues
|
1,467
|
|
|
6,862
|
|
|
2,788
|
|
|
3,871
|
|
|
24,577
|
|
|
2,447
|
|
|
362
|
|
|
42,374
|
|
|
|
||||||||
FFO from equity accounted investments
|
—
|
|
|
904
|
|
|
23
|
|
|
904
|
|
|
229
|
|
|
1
|
|
|
8
|
|
|
2,069
|
|
|
ii
|
||||||||
Interest expense
|
—
|
|
|
(1,901
|
)
|
|
(691
|
)
|
|
(453
|
)
|
|
(237
|
)
|
|
(83
|
)
|
|
(261
|
)
|
|
(3,626
|
)
|
|
iii
|
||||||||
Current income taxes
|
—
|
|
|
(63
|
)
|
|
(39
|
)
|
|
(111
|
)
|
|
(84
|
)
|
|
(46
|
)
|
|
57
|
|
|
(286
|
)
|
|
iv
|
||||||||
Funds from operations
|
970
|
|
|
2,004
|
|
|
270
|
|
|
345
|
|
|
333
|
|
|
34
|
|
|
(146
|
)
|
|
3,810
|
|
|
v
|
||||||||
Common equity
|
312
|
|
|
16,725
|
|
|
4,944
|
|
|
2,834
|
|
|
4,215
|
|
|
2,915
|
|
|
(7,893
|
)
|
|
24,052
|
|
|
|
||||||||
Equity accounted investments
|
—
|
|
|
19,597
|
|
|
509
|
|
|
8,793
|
|
|
2,387
|
|
|
346
|
|
|
362
|
|
|
31,994
|
|
|
|
||||||||
Additions to non-current assets
1
|
—
|
|
|
10,025
|
|
|
7,555
|
|
|
7,991
|
|
|
6,307
|
|
|
74
|
|
|
328
|
|
|
32,280
|
|
|
|
1.
|
Includes equity accounted investments, investment properties, property, plant and equipment, sustainable resources, intangible assets and goodwill.
|
ii.
|
FFO from Equity Accounted Investments
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Consolidated equity accounted income
|
$
|
1,088
|
|
|
$
|
1,213
|
|
Non-FFO items from equity accounted investments
1
|
1,284
|
|
|
856
|
|
||
FFO from equity accounted investments
|
$
|
2,372
|
|
|
$
|
2,069
|
|
1.
|
Adjustment to back out non-FFO expenses (income) that are included in consolidated equity accounted income including depreciation and amortization, deferred taxes and fair value changes from equity accounted investments.
|
iv.
|
Current Income Taxes
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current tax expense
|
$
|
(861
|
)
|
|
$
|
(286
|
)
|
Deferred income tax recovery (expense)
|
1,109
|
|
|
(327
|
)
|
||
Income tax recovery (expense)
|
$
|
248
|
|
|
$
|
(613
|
)
|
v.
|
Reconciliation of Net Income to Total FFO
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Net income
|
|
|
$
|
7,488
|
|
|
$
|
4,551
|
|
Realized disposition gains in fair value changes or equity
|
vi
|
|
1,445
|
|
|
1,116
|
|
||
Non-controlling interests in FFO
|
|
|
(6,015
|
)
|
|
(4,964
|
)
|
||
Financial statement components not included in FFO
|
|
|
|
|
|
||||
Equity accounted fair value changes and other non-FFO items
|
|
|
1,284
|
|
|
856
|
|
||
Fair value changes
|
|
|
(1,794
|
)
|
|
(421
|
)
|
||
Depreciation and amortization
|
|
|
3,102
|
|
|
2,345
|
|
||
Deferred income taxes
|
|
|
(1,109
|
)
|
|
327
|
|
||
Total FFO
|
|
|
$
|
4,401
|
|
|
$
|
3,810
|
|
vi.
|
Realized Disposition Gains
|
d)
|
Geographic Allocation
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
United Kingdom
|
$
|
23,684
|
|
|
$
|
15,106
|
|
United States
|
9,756
|
|
|
8,284
|
|
||
Canada
|
6,422
|
|
|
5,883
|
|
||
Australia
|
4,968
|
|
|
4,405
|
|
||
Brazil
|
4,048
|
|
|
3,206
|
|
||
Other Europe
|
3,275
|
|
|
617
|
|
||
Asia
|
1,643
|
|
|
1,119
|
|
||
Colombia
|
1,594
|
|
|
970
|
|
||
Other
|
1,381
|
|
|
1,196
|
|
||
|
$
|
56,771
|
|
|
$
|
40,786
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
United States
|
$
|
128,808
|
|
|
$
|
84,860
|
|
Canada
|
27,850
|
|
|
21,897
|
|
||
United Kingdom
|
23,093
|
|
|
20,005
|
|
||
Brazil
|
22,539
|
|
|
23,931
|
|
||
Australia
|
13,309
|
|
|
14,501
|
|
||
Other Europe
|
13,250
|
|
|
3,979
|
|
||
Asia
|
10,479
|
|
|
8,089
|
|
||
Colombia
|
9,862
|
|
|
7,362
|
|
||
Other
|
7,091
|
|
|
8,096
|
|
||
|
$
|
256,281
|
|
|
$
|
192,720
|
|
4.
|
SUBSIDIARIES
|
|
Jurisdiction of Formation
|
|
Ownership Interest Held by Non-Controlling Interests
1, 2
|
||||
AS AT DEC. 31
|
|
2018
|
|
|
2017
|
|
|
Brookfield Property Partners L.P. (“BPY”)
|
Bermuda
|
|
46.2
|
%
|
|
30.6
|
%
|
Brookfield Renewable Partners L.P. (“BEP”)
|
Bermuda
|
|
39.5
|
%
|
|
39.8
|
%
|
Brookfield Infrastructure Partners L.P. (“BIP”)
|
Bermuda
|
|
70.5
|
%
|
|
70.1
|
%
|
Brookfield Business Partners L.P. (“BBU”)
|
Bermuda
|
|
32.0
|
%
|
|
32.0
|
%
|
1.
|
Control and associated voting rights of the limited partnerships (BPY, BEP, BIP and BBU) resides with their respective general partners which are wholly owned subsidiaries of the company. The company’s general partner interest is entitled to earn base management fees and incentive payments in the form of incentive distribution rights or performance fees.
|
2.
|
The company’s ownership interest in BPY, BEP, BIP and BBU includes a combination of redemption-exchange units (REUs), Class A limited partnership units, special limited partnership units, general partnership units and units or shares that are exchangeable for units in our listed partnerships, in each subsidiary, where applicable. Each of BPY, BEP, BIP and BBU’s partnership capital includes its Class A limited partnership units whereas REUs and general partnership units are considered non-controlling interests for the respective partnerships. REUs share the same economic attributes in all respects except for the redemption right attached thereto. The REUs and general partnership units participate in earnings and distributions on a per unit basis equivalent to the per unit participation of the Class A limited partnership units of the subsidiary.
|
|
TSX
|
|
NYSE
|
|
Nasdaq
|
BPY
|
BPY.UN
|
|
N/A
|
|
BPY
|
BEP
|
BEP.UN
|
|
BEP
|
|
N/A
|
BIP
|
BIP.UN
|
|
BIP
|
|
N/A
|
BBU
|
BBU.UN
|
|
BBU
|
|
N/A
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
BPY
|
$
|
31,580
|
|
|
$
|
19,736
|
|
BEP
|
12,457
|
|
|
10,139
|
|
||
BIP
|
12,752
|
|
|
11,376
|
|
||
BBU
|
4,477
|
|
|
4,000
|
|
||
Individually immaterial subsidiaries with non-controlling interests
|
6,069
|
|
|
6,377
|
|
||
|
$
|
67,335
|
|
|
$
|
51,628
|
|
|
BPY
|
|
BEP
|
|
BIP
|
|
BBU
|
||||||||||||||||||||||||
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||||||
Current assets
|
$
|
7,114
|
|
|
$
|
3,912
|
|
|
$
|
1,961
|
|
|
$
|
1,666
|
|
|
$
|
2,276
|
|
|
$
|
1,512
|
|
|
$
|
9,781
|
|
|
$
|
6,433
|
|
Non-current assets
|
115,406
|
|
|
80,435
|
|
|
32,142
|
|
|
29,238
|
|
|
34,304
|
|
|
27,965
|
|
|
17,537
|
|
|
9,371
|
|
||||||||
Current liabilities
|
(10,306
|
)
|
|
(11,829
|
)
|
|
(1,689
|
)
|
|
(2,514
|
)
|
|
(2,417
|
)
|
|
(1,564
|
)
|
|
(9,016
|
)
|
|
(5,690
|
)
|
||||||||
Non-current liabilities
|
(65,474
|
)
|
|
(37,394
|
)
|
|
(15,208
|
)
|
|
(14,108
|
)
|
|
(19,495
|
)
|
|
(14,439
|
)
|
|
(11,808
|
)
|
|
(4,050
|
)
|
||||||||
Non-controlling interests
|
(31,580
|
)
|
|
(19,736
|
)
|
|
(12,457
|
)
|
|
(10,139
|
)
|
|
(12,752
|
)
|
|
(11,376
|
)
|
|
(4,477
|
)
|
|
(4,000
|
)
|
||||||||
Equity attributable to Brookfield
|
$
|
15,160
|
|
|
$
|
15,388
|
|
|
$
|
4,749
|
|
|
$
|
4,143
|
|
|
$
|
1,916
|
|
|
$
|
2,098
|
|
|
$
|
2,017
|
|
|
$
|
2,064
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Revenues
|
$
|
7,239
|
|
|
$
|
6,135
|
|
|
$
|
2,982
|
|
|
$
|
2,625
|
|
|
$
|
4,652
|
|
|
$
|
3,535
|
|
|
$
|
37,168
|
|
|
$
|
22,823
|
|
Net income attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Non-controlling interests
|
$
|
2,356
|
|
|
$
|
2,234
|
|
|
$
|
401
|
|
|
$
|
103
|
|
|
$
|
724
|
|
|
$
|
569
|
|
|
$
|
1,106
|
|
|
$
|
296
|
|
Shareholders
|
1,298
|
|
|
234
|
|
|
2
|
|
|
(52
|
)
|
|
82
|
|
|
5
|
|
|
97
|
|
|
(81
|
)
|
||||||||
|
$
|
3,654
|
|
|
$
|
2,468
|
|
|
$
|
403
|
|
|
$
|
51
|
|
|
$
|
806
|
|
|
$
|
574
|
|
|
$
|
1,203
|
|
|
$
|
215
|
|
Other comprehensive income (loss) attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Non-controlling interests
|
$
|
(122
|
)
|
|
$
|
532
|
|
|
$
|
2,292
|
|
|
$
|
786
|
|
|
$
|
(859
|
)
|
|
$
|
269
|
|
|
$
|
(292
|
)
|
|
$
|
64
|
|
Shareholders
|
(294
|
)
|
|
348
|
|
|
972
|
|
|
564
|
|
|
(86
|
)
|
|
54
|
|
|
(96
|
)
|
|
45
|
|
||||||||
|
$
|
(416
|
)
|
|
$
|
880
|
|
|
$
|
3,264
|
|
|
$
|
1,350
|
|
|
$
|
(945
|
)
|
|
$
|
323
|
|
|
$
|
(388
|
)
|
|
$
|
109
|
|
|
BPY
|
|
BEP
|
|
BIP
|
|
BBU
|
||||||||||||||||||||||||
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||||||
Cash flows from (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Operating activities
|
$
|
1,357
|
|
|
$
|
639
|
|
|
$
|
1,103
|
|
|
$
|
928
|
|
|
$
|
1,362
|
|
|
$
|
1,481
|
|
|
$
|
1,341
|
|
|
$
|
290
|
|
Financing activities
|
8,873
|
|
|
1,248
|
|
|
(1,080
|
)
|
|
(27
|
)
|
|
4,418
|
|
|
3,814
|
|
|
3,561
|
|
|
1,353
|
|
||||||||
Investing activities
|
(8,406
|
)
|
|
(1,886
|
)
|
|
(624
|
)
|
|
(328
|
)
|
|
(5,564
|
)
|
|
(5,721
|
)
|
|
(3,999
|
)
|
|
(1,595
|
)
|
||||||||
Distributions paid to non-controlling interests in common equity
|
$
|
427
|
|
|
$
|
255
|
|
|
$
|
244
|
|
|
$
|
227
|
|
|
$
|
558
|
|
|
$
|
489
|
|
|
$
|
11
|
|
|
$
|
9
|
|
5.
|
ACQUISITIONS OF CONSOLIDATED ENTITIES
|
a)
|
Completed During 2018
|
(MILLIONS)
|
Real Estate
|
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Renewable Power and Other
|
|
|
Total
|
|
|||||
Cash and cash equivalents
|
$
|
1,056
|
|
|
$
|
71
|
|
|
$
|
658
|
|
|
$
|
388
|
|
|
$
|
2,173
|
|
Accounts receivable and other
|
2,247
|
|
|
511
|
|
|
2,267
|
|
|
623
|
|
|
5,648
|
|
|||||
Inventory
|
150
|
|
|
23
|
|
|
686
|
|
|
5
|
|
|
864
|
|
|||||
Equity accounted investments
|
12,379
|
|
|
15
|
|
|
329
|
|
|
29
|
|
|
12,752
|
|
|||||
Investment properties
|
33,024
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,024
|
|
|||||
Property, plant and equipment
|
1,748
|
|
|
2,945
|
|
|
4,913
|
|
|
2,970
|
|
|
12,576
|
|
|||||
Intangible assets
|
54
|
|
|
3,208
|
|
|
2,942
|
|
|
386
|
|
|
6,590
|
|
|||||
Goodwill
|
96
|
|
|
2,905
|
|
|
971
|
|
|
186
|
|
|
4,158
|
|
|||||
Deferred income tax assets
|
220
|
|
|
—
|
|
|
38
|
|
|
582
|
|
|
840
|
|
|||||
Total assets
|
50,974
|
|
|
9,678
|
|
|
12,804
|
|
|
5,169
|
|
|
78,625
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other
|
(2,177
|
)
|
|
(591
|
)
|
|
(3,654
|
)
|
|
(715
|
)
|
|
(7,137
|
)
|
|||||
Non-recourse borrowings
|
(18,218
|
)
|
|
(1,484
|
)
|
|
(3,668
|
)
|
|
(2,023
|
)
|
|
(25,393
|
)
|
|||||
Deferred income tax liabilities
|
(58
|
)
|
|
(839
|
)
|
|
(157
|
)
|
|
(210
|
)
|
|
(1,264
|
)
|
|||||
Non-controlling interests
1
|
(2,603
|
)
|
|
(544
|
)
|
|
(515
|
)
|
|
(22
|
)
|
|
(3,684
|
)
|
|||||
|
(23,056
|
)
|
|
(3,458
|
)
|
|
(7,994
|
)
|
|
(2,970
|
)
|
|
(37,478
|
)
|
|||||
Net assets acquired
|
$
|
27,918
|
|
|
$
|
6,220
|
|
|
$
|
4,810
|
|
|
$
|
2,199
|
|
|
$
|
41,147
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consideration
2
|
$
|
26,759
|
|
|
$
|
6,220
|
|
|
$
|
4,810
|
|
|
$
|
1,807
|
|
|
$
|
39,596
|
|
1.
|
Includes non-controlling interests recognized on business combinations measured as the proportionate share of fair value of the identifiable assets and liabilities on the date of acquisition. For certain business combinations in our Private Equity segment, non-controlling interests recognized on business combinations are measured at the proportionate fair value of the total net assets on date of acquisition.
|
2.
|
Total consideration, including amounts paid by non-controlling interests that participated in the acquisition as investors in Brookfield-sponsored private funds or as co-investors.
|
|
Real Estate
|
|
Private Equity
|
|
Infrastructure
|
|
Renewable Power
|
|
|||||||||||||||||||||||
(MILLIONS)
|
666 Fifth
|
|
|
GGP
|
|
|
Forest City
|
|
|
Westinghouse
|
|
|
NorthRiver
|
|
|
Enercare
|
|
|
Evoque
|
|
|
Saeta Yield
|
|
||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
424
|
|
|
$
|
451
|
|
|
$
|
250
|
|
|
$
|
10
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
187
|
|
Accounts receivable and other
|
11
|
|
|
592
|
|
|
960
|
|
|
1,854
|
|
|
55
|
|
|
187
|
|
|
3
|
|
|
216
|
|
||||||||
Inventory
|
—
|
|
|
—
|
|
|
89
|
|
|
626
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Equity accounted investments
|
—
|
|
|
10,829
|
|
|
1,467
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14
|
|
||||||||
Investment properties
|
1,292
|
|
|
17,991
|
|
|
9,397
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Property, plant and equipment
|
—
|
|
|
56
|
|
|
—
|
|
|
931
|
|
|
1,442
|
|
|
669
|
|
|
440
|
|
|
2,724
|
|
||||||||
Intangible assets
|
—
|
|
|
—
|
|
|
—
|
|
|
2,683
|
|
|
157
|
|
|
1,863
|
|
|
221
|
|
|
258
|
|
||||||||
Goodwill
|
—
|
|
|
—
|
|
|
—
|
|
|
213
|
|
|
524
|
|
|
1,260
|
|
|
463
|
|
|
115
|
|
||||||||
Deferred income tax assets
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
23
|
|
|
—
|
|
|
—
|
|
||||||||
Total assets
|
1,303
|
|
|
29,892
|
|
|
12,364
|
|
|
6,571
|
|
|
2,188
|
|
|
4,026
|
|
|
1,127
|
|
|
3,514
|
|
||||||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Accounts payable and other
|
(4
|
)
|
|
(691
|
)
|
|
(1,119
|
)
|
|
(2,645
|
)
|
|
(46
|
)
|
|
(235
|
)
|
|
(24
|
)
|
|
(320
|
)
|
||||||||
Non-recourse borrowings
|
—
|
|
|
(13,147
|
)
|
|
(3,664
|
)
|
|
(3
|
)
|
|
—
|
|
|
(877
|
)
|
|
—
|
|
|
(1,906
|
)
|
||||||||
Deferred income tax liabilities
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
(81
|
)
|
|
(186
|
)
|
|
(472
|
)
|
|
—
|
|
|
(174
|
)
|
||||||||
Non-controlling interests
1
|
—
|
|
|
(1,882
|
)
|
|
(633
|
)
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
|
(4
|
)
|
|
(15,731
|
)
|
|
(5,416
|
)
|
|
(2,736
|
)
|
|
(232
|
)
|
|
(1,584
|
)
|
|
(24
|
)
|
|
(2,400
|
)
|
||||||||
Net assets acquired
|
$
|
1,299
|
|
|
$
|
14,161
|
|
|
$
|
6,948
|
|
|
$
|
3,835
|
|
|
$
|
1,956
|
|
|
$
|
2,442
|
|
|
$
|
1,103
|
|
|
$
|
1,114
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Consideration
2
|
$
|
1,299
|
|
|
$
|
13,240
|
|
|
$
|
6,948
|
|
|
$
|
3,835
|
|
|
$
|
1,956
|
|
|
$
|
2,442
|
|
|
$
|
1,103
|
|
|
$
|
1,114
|
|
1.
|
Includes non-controlling interests recognized on business combinations measured as the proportionate share of fair value of the identifiable assets and liabilities on the date of acquisition. For certain business combinations in our Private Equity segment, non-controlling interests recognized on business combinations are measured at the proportionate fair value of the total net assets on date of acquisition.
|
2.
|
Total consideration, including amounts paid by non-controlling interests that participated in the acquisition as investors in Brookfield-sponsored private funds or as co-investors.
|
•
|
A new entity, Brookfield Property REIT (“BPR”), was formed to hold the GGP assets; BPR issued
161 million
shares to GGP shareholders as consideration. BPR shares, which are structured to provide an economic return equivalent to that of BPY units, are presented as non-controlling interests within equity.
|
•
|
The acquisition was accounted for as a business combination achieved in stages. Our existing equity interest in GGP was remeasured to its fair value of
$7.8 billion
immediately prior to the completion of the transaction based on our interest in the fair value of GGP’s identifiable net assets and liabilities. As a result of this remeasurement, a loss of approximately
$502 million
was recognized in fair value changes.
|
•
|
Total consideration of
$13.2 billion
is made up of our existing equity investment of
$7.8 billion
, new equity, in the form of
88 million
BPY LP units and
161 million
BPR Class A shares, issued to GGP’s shareholders totaling
$5.2 billion
, cash consideration of
$200 million
and share-based payment awards to GGP employees with a fair value of
$28 million
. On acquisition, we recognized a bargain purchase gain of
$921 million
in fair value changes as the agreed upon transaction price and the fair value of the consideration transferred was less than the aggregate fair value of the assets acquired net of the liabilities assumed.
|
•
|
Total revenues and net income that would have been recorded if the transaction had occurred at the beginning of the year are
$1.8 billion
and
$1.1 billion
, respectively.
|
•
|
On February 1, 2018, a subsidiary of the company in our Real Estate segment acquired a portfolio of
15
student housing properties in the U.K. for total consideration of
$752 million
.
|
•
|
On February 1, 2018, a subsidiary of the company in our Real Estate segment acquired a portfolio of
105
extended-stay hotel properties across the U.S. for total consideration of
$764 million
.
|
•
|
On March 9, 2018, the company obtained control over an entity, previously held as an equity-accounted investment. The company recognized a bargain purchase gain of
$393 million
as a result of the recognition of deferred tax assets which were not previously utilized.
|
•
|
On May 15, 2018, a subsidiary of the company in our Private Equity segment
acquired, together with institutional investors, a
70%
interest in Schoeller Allibert Group B.V (“Schoeller”) for total consideration of
$231 million
.
Total revenues and net loss that would have been recorded if the transaction had occurred at the beginning of the year are
$635 million
and
$27 million
, respectively.
|
•
|
On June 1, 2018, a subsidiary of the company in our Infrastructure segment, along with institutional investors, acquired a
55%
interest in Gas Natural, S.A. ESP (“Gas Natural”), for total consideration of
$522 million
. The future growth arising from the business’ position as a key distributor of natural gas in Colombia gave rise to goodwill of
$621 million
, the remainder of the goodwill is due to the difference between the book value and tax bases of the assets acquired. None of the goodwill recognized is deductible for income tax purposes. Total revenues and net income that would have been recorded if the transaction had occurred at the beginning of the year are
$884 million
and
$70 million
, respectively.
|
•
|
On July 3, 2018, a subsidiary of the company in our Private Equity segment, together with institutional investors, exercised its general partner option to obtain an additional
2%
voting interest in the general partner of Teekay Offshore (“Teekay”), granting it control of the entity. Our equity interest in Teekay was remeasured to fair value immediately prior to obtaining control, resulting in a gain of approximately
$206 million
. Total consideration paid was
$653 million
,
$651 million
of which was the fair market value of our existing investment. Total assets acquired are
$5.3 billion
and include
$3.7 billion
in property plant and equipment. Total liabilities assumed are
$4.1 billion
and include
$3.3 billion
of non-recourse borrowings. Goodwill of
$547 million
represents benefits we expect to receive from the integration of the operations; none of the goodwill recognized is deductible for income tax purposes.
The value of assets and liabilities acquired are still under evaluation and accounted for on a provisional basis.
Total revenues and net income that would have been recorded if the transaction had occurred at the beginning of the year are
$1.3 billion
and
$214 million
, respectively.
|
(MILLIONS)
|
Renewable Power
|
|
|
Private Equity
|
|
|
Infrastructure
|
|
|
Real Estate and Other
|
|
|
Total
|
|
|||||
Cash and cash equivalents
|
$
|
762
|
|
|
$
|
335
|
|
|
$
|
89
|
|
|
$
|
39
|
|
|
$
|
1,225
|
|
Accounts receivable and other
|
980
|
|
|
2,393
|
|
|
345
|
|
|
134
|
|
|
3,852
|
|
|||||
Inventory
|
—
|
|
|
701
|
|
|
—
|
|
|
3
|
|
|
704
|
|
|||||
Equity accounted investments
|
—
|
|
|
231
|
|
|
—
|
|
|
—
|
|
|
231
|
|
|||||
Investment properties
|
—
|
|
|
—
|
|
|
—
|
|
|
5,851
|
|
|
5,851
|
|
|||||
Property, plant and equipment
|
6,923
|
|
|
501
|
|
|
100
|
|
|
281
|
|
|
7,805
|
|
|||||
Intangible assets
|
27
|
|
|
2,870
|
|
|
5,515
|
|
|
—
|
|
|
8,412
|
|
|||||
Goodwill
|
—
|
|
|
342
|
|
|
815
|
|
|
—
|
|
|
1,157
|
|
|||||
Deferred income tax assets
|
18
|
|
|
59
|
|
|
—
|
|
|
—
|
|
|
77
|
|
|||||
Total assets
|
8,710
|
|
|
7,432
|
|
|
6,864
|
|
|
6,308
|
|
|
29,314
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other
|
(1,391
|
)
|
|
(2,109
|
)
|
|
(222
|
)
|
|
(169
|
)
|
|
(3,891
|
)
|
|||||
Non-recourse borrowings
|
(4,902
|
)
|
|
(1,678
|
)
|
|
(30
|
)
|
|
(1,955
|
)
|
|
(8,565
|
)
|
|||||
Deferred income tax liabilities
|
(59
|
)
|
|
(806
|
)
|
|
(957
|
)
|
|
(45
|
)
|
|
(1,867
|
)
|
|||||
Non-controlling interests
1
|
(830
|
)
|
|
(826
|
)
|
|
(477
|
)
|
|
(123
|
)
|
|
(2,256
|
)
|
|||||
|
(7,182
|
)
|
|
(5,419
|
)
|
|
(1,686
|
)
|
|
(2,292
|
)
|
|
(16,579
|
)
|
|||||
Net assets acquired
|
$
|
1,528
|
|
|
$
|
2,013
|
|
|
$
|
5,178
|
|
|
$
|
4,016
|
|
|
$
|
12,735
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consideration
2
|
$
|
1,528
|
|
|
$
|
2,006
|
|
|
$
|
5,178
|
|
|
$
|
3,845
|
|
|
$
|
12,557
|
|
1.
|
Includes non-controlling interests recognized on business combinations measured as the proportionate share of fair value of the assets and liabilities on the date of acquisition.
|
2.
|
Total consideration, including amounts paid by non-controlling interests that participated in the acquisition as investors in Brookfield-sponsored private funds or as co-investors.
|
|
Renewable Power
|
|
Private Equity
|
|
Infrastructure
|
|
Real Estate
|
||||||||||||||||||||||||
(MILLIONS)
|
TerraForm Power
|
|
|
TerraForm Global
|
|
|
BRK
|
|
|
Greenergy
|
|
|
NTS
|
|
|
Manufactured Housing
|
|
|
Houston Center
|
|
|
Mumbai Office Portfolio
|
|
||||||||
Cash and cash equivalents
|
$
|
149
|
|
|
$
|
611
|
|
|
$
|
296
|
|
|
$
|
28
|
|
|
$
|
89
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
11
|
|
Accounts receivable and other
|
707
|
|
|
266
|
|
|
1,043
|
|
|
1,290
|
|
|
317
|
|
|
79
|
|
|
22
|
|
|
12
|
|
||||||||
Inventory
|
—
|
|
|
—
|
|
|
10
|
|
|
650
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Equity accounted investments
|
—
|
|
|
—
|
|
|
109
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Investment properties
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,107
|
|
|
825
|
|
|
679
|
|
||||||||
Property, plant and equipment
|
5,678
|
|
|
1,208
|
|
|
200
|
|
|
154
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Intangible assets
|
—
|
|
|
—
|
|
|
2,467
|
|
|
212
|
|
|
5,515
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Goodwill
|
—
|
|
|
—
|
|
|
17
|
|
|
92
|
|
|
804
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Deferred income tax assets
|
—
|
|
|
18
|
|
|
50
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total assets
|
6,534
|
|
|
2,103
|
|
|
4,192
|
|
|
2,549
|
|
|
6,725
|
|
|
2,202
|
|
|
847
|
|
|
702
|
|
||||||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Accounts payable and other
|
(1,239
|
)
|
|
(142
|
)
|
|
(227
|
)
|
|
(1,744
|
)
|
|
(202
|
)
|
|
(36
|
)
|
|
(28
|
)
|
|
(44
|
)
|
||||||||
Non-recourse borrowings
|
(3,714
|
)
|
|
(1,188
|
)
|
|
(1,468
|
)
|
|
(210
|
)
|
|
—
|
|
|
(1,261
|
)
|
|
—
|
|
|
(511
|
)
|
||||||||
Deferred income tax liabilities
|
(33
|
)
|
|
(15
|
)
|
|
(746
|
)
|
|
(52
|
)
|
|
(946
|
)
|
|
—
|
|
|
—
|
|
|
(45
|
)
|
||||||||
Non-controlling interests
1
|
(829
|
)
|
|
(1
|
)
|
|
(745
|
)
|
|
(81
|
)
|
|
(477
|
)
|
|
(30
|
)
|
|
—
|
|
|
—
|
|
||||||||
|
(5,815
|
)
|
|
(1,346
|
)
|
|
(3,186
|
)
|
|
(2,087
|
)
|
|
(1,625
|
)
|
|
(1,327
|
)
|
|
(28
|
)
|
|
(600
|
)
|
||||||||
Net assets acquired
|
$
|
719
|
|
|
$
|
757
|
|
|
$
|
1,006
|
|
|
$
|
462
|
|
|
$
|
5,100
|
|
|
$
|
875
|
|
|
$
|
819
|
|
|
$
|
102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Consideration
2
|
$
|
719
|
|
|
$
|
757
|
|
|
$
|
1,006
|
|
|
$
|
462
|
|
|
$
|
5,100
|
|
|
$
|
768
|
|
|
$
|
819
|
|
|
$
|
102
|
|
1.
|
Includes non-controlling interests recognized on business combinations measured as the proportionate share of fair value of the assets and liabilities on the date of acquisition.
|
2.
|
Total consideration, including amounts paid by non-controlling interests that participated in the acquisition as investors in Brookfield-sponsored private funds or as co-investors.
|
6.
|
FAIR VALUE OF FINANCIAL INSTRUMENTS
|
a)
|
Financial Instrument Classification
|
AS AT DEC. 31, 2018
(MILLIONS) |
Fair Value Through
Profit or Loss
|
|
|
Fair Value Through OCI
|
|
|
Amortized Cost
|
|
|
Total
|
|
||||
Financial assets
1
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,390
|
|
|
$
|
8,390
|
|
Other financial assets
|
|
|
|
|
|
|
|
||||||||
Government bonds
|
68
|
|
|
20
|
|
|
—
|
|
|
88
|
|
||||
Corporate bonds
|
536
|
|
|
96
|
|
|
273
|
|
|
905
|
|
||||
Fixed income securities and other
|
570
|
|
|
311
|
|
|
156
|
|
|
1,037
|
|
||||
Common shares and warrants
|
689
|
|
|
1,690
|
|
|
—
|
|
|
2,379
|
|
||||
Loans and notes receivable
|
50
|
|
|
—
|
|
|
1,768
|
|
|
1,818
|
|
||||
|
1,913
|
|
|
2,117
|
|
|
2,197
|
|
|
6,227
|
|
||||
Accounts receivable and other
2
|
2,113
|
|
|
—
|
|
|
10,449
|
|
|
12,562
|
|
||||
|
$
|
4,026
|
|
|
$
|
2,117
|
|
|
$
|
21,036
|
|
|
$
|
27,179
|
|
Financial liabilities
|
|
|
|
|
|
|
|
||||||||
Corporate borrowings
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,409
|
|
|
$
|
6,409
|
|
Non-recourse borrowings of managed entities
|
|
|
|
|
|
|
|
||||||||
Property-specific borrowings
|
—
|
|
|
—
|
|
|
103,209
|
|
|
103,209
|
|
||||
Subsidiary borrowings
|
—
|
|
|
—
|
|
|
8,600
|
|
|
8,600
|
|
||||
|
—
|
|
|
—
|
|
|
111,809
|
|
|
111,809
|
|
||||
Accounts payable and other
2
|
3,362
|
|
|
—
|
|
|
20,627
|
|
|
23,989
|
|
||||
Subsidiary equity obligations
|
1,725
|
|
|
—
|
|
|
2,151
|
|
|
3,876
|
|
||||
|
$
|
5,087
|
|
|
$
|
—
|
|
|
$
|
140,996
|
|
|
$
|
146,083
|
|
1.
|
Financial assets include
$7.2 billion
of assets pledged as collateral.
|
2.
|
Includes derivative instruments which are elected for hedge accounting, totaling
$1.5 billion
included in accounts receivable and other and
$465 million
included in accounts payable and other, for which changes in fair value are recorded in other comprehensive income.
|
AS AT DEC. 31, 2017
(MILLIONS) |
Fair Value Through
Profit or Loss
|
|
|
Available for Sale
|
|
|
Loans and Receivables/Other Financial Liabilities
|
|
|
|
|||||
Measurement basis
|
(Fair Value)
|
|
|
(Fair Value)
|
|
|
(Amortized Cost)
|
|
|
Total
|
|
||||
Financial assets
1
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,139
|
|
|
$
|
5,139
|
|
Other financial assets
|
|
|
|
|
|
|
|
||||||||
Government bonds
|
34
|
|
|
15
|
|
|
—
|
|
|
49
|
|
||||
Corporate bonds
|
382
|
|
|
253
|
|
|
8
|
|
|
643
|
|
||||
Fixed income securities and other
|
230
|
|
|
432
|
|
|
—
|
|
|
662
|
|
||||
Common shares and warrants
|
585
|
|
|
1,247
|
|
|
—
|
|
|
1,832
|
|
||||
Loans and notes receivable
|
63
|
|
|
—
|
|
|
1,551
|
|
|
1,614
|
|
||||
|
1,294
|
|
|
1,947
|
|
|
1,559
|
|
|
4,800
|
|
||||
Accounts receivable and other
2
|
1,383
|
|
|
—
|
|
|
8,233
|
|
|
9,616
|
|
||||
|
$
|
2,677
|
|
|
$
|
1,947
|
|
|
$
|
14,931
|
|
|
$
|
19,555
|
|
Financial liabilities
|
|
|
|
|
|
|
|
||||||||
Corporate borrowings
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,659
|
|
|
$
|
5,659
|
|
Non-recourse borrowings of managed entities
|
|
|
|
|
|
|
|
||||||||
Property-specific borrowings
|
—
|
|
|
—
|
|
|
63,721
|
|
|
63,721
|
|
||||
Subsidiary borrowings
|
—
|
|
|
—
|
|
|
9,009
|
|
|
9,009
|
|
||||
|
—
|
|
|
—
|
|
|
72,730
|
|
|
72,730
|
|
||||
Accounts payable and other
2
|
3,841
|
|
|
—
|
|
|
14,124
|
|
|
17,965
|
|
||||
Subsidiary equity obligations
|
1,559
|
|
|
—
|
|
|
2,102
|
|
|
3,661
|
|
||||
|
$
|
5,400
|
|
|
$
|
—
|
|
|
$
|
94,615
|
|
|
$
|
100,015
|
|
1.
|
Financial assets include
$4.1 billion
of assets pledged as collateral.
|
2.
|
Includes derivative instruments which are elected for hedge accounting, totaling
$630 million
included in accounts receivable and other and
$950 million
included in accounts payable and other, for which changes in fair value are recorded in other comprehensive income.
|
b)
|
Carrying and Fair Value
|
|
2018
|
|
2017
|
||||||||||||
AS AT DEC. 31
(MILLIONS) |
Carrying
Value
|
|
|
Fair Value
|
|
|
Carrying
Value
|
|
|
Fair Value
|
|
||||
Financial assets
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
8,390
|
|
|
$
|
8,390
|
|
|
$
|
5,139
|
|
|
$
|
5,139
|
|
Other financial assets
|
|
|
|
|
|
|
|
||||||||
Government bonds
|
88
|
|
|
88
|
|
|
49
|
|
|
49
|
|
||||
Corporate bonds
|
905
|
|
|
905
|
|
|
643
|
|
|
643
|
|
||||
Fixed income securities and other
|
1,037
|
|
|
1,037
|
|
|
662
|
|
|
662
|
|
||||
Common shares and warrants
|
2,379
|
|
|
2,379
|
|
|
1,832
|
|
|
1,832
|
|
||||
Loans and notes receivable
|
1,818
|
|
|
1,818
|
|
|
1,614
|
|
|
1,657
|
|
||||
|
6,227
|
|
|
6,227
|
|
|
4,800
|
|
|
4,843
|
|
||||
Accounts receivable and other
|
12,562
|
|
|
12,562
|
|
|
9,616
|
|
|
9,616
|
|
||||
|
$
|
27,179
|
|
|
$
|
27,179
|
|
|
$
|
19,555
|
|
|
$
|
19,598
|
|
Financial liabilities
|
|
|
|
|
|
|
|
||||||||
Corporate borrowings
|
$
|
6,409
|
|
|
$
|
6,467
|
|
|
$
|
5,659
|
|
|
$
|
6,087
|
|
Non-recourse borrowings of managed entities
|
|
|
|
|
|
|
|
||||||||
Property-specific borrowings
|
103,209
|
|
|
104,291
|
|
|
63,721
|
|
|
65,399
|
|
||||
Subsidiary borrowings
|
8,600
|
|
|
8,557
|
|
|
9,009
|
|
|
9,172
|
|
||||
|
111,809
|
|
|
112,848
|
|
|
72,730
|
|
|
74,571
|
|
||||
Accounts payable and other
|
23,989
|
|
|
23,989
|
|
|
17,965
|
|
|
17,965
|
|
||||
Subsidiary equity obligations
|
3,876
|
|
|
3,876
|
|
|
3,661
|
|
|
3,661
|
|
||||
|
$
|
146,083
|
|
|
$
|
147,180
|
|
|
$
|
100,015
|
|
|
$
|
102,284
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current
|
$
|
3,382
|
|
|
$
|
2,568
|
|
Non-current
|
2,845
|
|
|
2,232
|
|
||
Total
|
$
|
6,227
|
|
|
$
|
4,800
|
|
(MILLIONS)
Type of Asset/Liability
|
|
Carrying Value
Dec. 31, 2018 |
|
|
Valuation
Techniques
|
|
Significant
Unobservable Inputs
|
|
Relationship of Unobservable
Inputs to Fair Value
|
|
Fixed income securities and other
|
|
$
|
490
|
|
|
Discounted cash flows
|
|
• Future cash flows
|
|
• Increases (decreases) in future cash flows increase (decrease) fair value
|
|
|
|
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) fair value
|
||
Common shares (common shares and warrants)
|
|
222
|
|
|
Black-Scholes model
|
|
• Volatility
|
|
• Increases (decreases) in volatility increase (decreases) fair value
|
|
|
|
|
|
|
|
• Term to maturity
|
|
• Increases (decreases) in term to maturity increase (decrease) fair value
|
||
|
|
|
|
|
|
• Risk free interest rate
|
|
• Increases (decreases) in the risk-free interest rate increase (decrease) fair value
|
||
Limited-life funds (subsidiary equity obligations)
|
|
(1,640
|
)
|
|
Discounted cash flows
|
|
• Future cash flows
|
|
• Increases (decreases) in future cash flows increase (decrease) fair value
|
|
|
|
|
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) fair value
|
||
|
|
|
|
|
|
• Terminal capitalization rate
|
|
• Increases (decreases) in terminal capitalization rate decrease (increase) fair value
|
||
|
|
|
|
|
|
• Investment horizon
|
|
• Increases (decreases) in the investment horizon decrease (increase) fair value
|
||
Derivative assets/Derivative liabilities (accounts receivable/payable)
|
|
79
|
/
|
|
Discounted cash flows
|
|
• Future cash flows
|
|
• Increases (decreases) in future cash flows increase (decrease) fair value
|
|
|
(659
|
)
|
|
|
|
|||||
|
|
|
|
• Forward exchange rates (from observable forward exchange rates at the end of the reporting period)
|
|
• Increases (decreases) in the forward exchange rate increase (decrease) fair value
|
||||
|
|
|
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) fair value
|
|
|
2018
|
|
2017
|
||||||||||||
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
|
Financial
Assets |
|
|
Financial
Liabilities |
|
|
Financial
Assets |
|
|
Financial
Liabilities |
|
||||
Balance, beginning of year
|
|
$
|
869
|
|
|
$
|
2,263
|
|
|
$
|
1,739
|
|
|
$
|
1,449
|
|
Fair value changes in net income
|
|
(113
|
)
|
|
(89
|
)
|
|
(313
|
)
|
|
(2
|
)
|
||||
Fair value changes in other comprehensive income
1
|
|
(2
|
)
|
|
(48
|
)
|
|
5
|
|
|
67
|
|
||||
Additions, net of disposals
|
|
41
|
|
|
173
|
|
|
(562
|
)
|
|
749
|
|
||||
Balance, end of year
|
|
$
|
795
|
|
|
$
|
2,299
|
|
|
$
|
869
|
|
|
$
|
2,263
|
|
1.
|
Includes foreign currency translation.
|
d)
|
Hedging Activities
|
i.
|
Cash Flow Hedges
|
ii.
|
Net Investment Hedges
|
e)
|
Netting of Financial Instruments
|
|
Accounts Receivable
and Other
|
|
Accounts Payable
and Other
|
||||||||||||
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||
Gross amounts of financial instruments before netting
|
$
|
2,367
|
|
|
$
|
1,605
|
|
|
$
|
1,873
|
|
|
$
|
2,124
|
|
Gross amounts of financial instruments set-off in Consolidated Balance Sheets
|
(254
|
)
|
|
(223
|
)
|
|
(250
|
)
|
|
(267
|
)
|
||||
Net amount of financial instruments in Consolidated Balance Sheets
|
$
|
2,113
|
|
|
$
|
1,382
|
|
|
$
|
1,623
|
|
|
$
|
1,857
|
|
7.
|
ACCOUNTS RECEIVABLE AND OTHER
|
AS AT DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Accounts receivable
|
(a)
|
|
$
|
9,167
|
|
|
$
|
7,209
|
|
Prepaid expenses and other assets
|
(a)
|
|
5,508
|
|
|
3,350
|
|
||
Restricted cash
|
(b)
|
|
1,923
|
|
|
1,024
|
|
||
Sustainable resources
|
(c)
|
|
333
|
|
|
390
|
|
||
Total
|
|
|
$
|
16,931
|
|
|
$
|
11,973
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current
|
$
|
11,911
|
|
|
$
|
8,492
|
|
Non-current
|
5,020
|
|
|
3,481
|
|
||
Total
|
$
|
16,931
|
|
|
$
|
11,973
|
|
a)
|
Accounts Receivable and Other Assets
|
b)
|
Restricted Cash
|
c)
|
Sustainable Resources
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Balance, beginning of year
|
$
|
390
|
|
|
$
|
387
|
|
Additions, net of disposals
|
21
|
|
|
78
|
|
||
Fair value adjustments
|
42
|
|
|
21
|
|
||
Decrease due to harvest
|
(89
|
)
|
|
(103
|
)
|
||
Foreign currency changes
|
(31
|
)
|
|
7
|
|
||
Balance, end of year
|
$
|
333
|
|
|
$
|
390
|
|
Valuation Techniques
|
|
Significant Unobservable Inputs
|
|
Relationship of Unobservable Inputs to Fair Value
|
|
Mitigating Factors
|
Discounted cash flow analysis
|
|
•
Future cash flows
|
|
•
Increases (decreases) in future cash flows increase (decrease) fair value
|
|
• Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
|
|
|
•
Timber / agricultural prices
|
|
• Increases (decreases) in price increase (decrease) fair value
|
|
• Increases (decreases) in price tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from price
|
|
|
•
Discount rate /terminal
capitalization rate
|
|
• Increases (decreases) in discount rate or terminal capitalization rate decrease (increase) fair value
|
|
• Decreases (increases) in discount rates or terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from rates
|
|
|
•
Exit Date
|
|
• Increases (decreases) in exit date decrease (increase) fair value
|
|
• Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
|
8.
|
INVENTORY
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Residential properties under development
|
$
|
2,001
|
|
|
$
|
2,245
|
|
Land held for development
|
1,794
|
|
|
1,922
|
|
||
Completed residential properties
|
1,398
|
|
|
917
|
|
||
Industrial products and other
1
|
1,796
|
|
|
1,227
|
|
||
Total
|
$
|
6,989
|
|
|
$
|
6,311
|
|
1.
|
Industrial products and other includes fuel inventory of
$585 million
(
2017
–
$612 million
)
.
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current
|
$
|
4,578
|
|
|
$
|
3,585
|
|
Non-current
|
2,411
|
|
|
2,726
|
|
||
Total
|
$
|
6,989
|
|
|
$
|
6,311
|
|
9.
|
HELD FOR SALE
|
AS AT DEC. 31
(MILLIONS)
|
Real Estate
|
|
|
Renewable Power
|
|
|
Private Equity
|
|
|
2018 Total
|
|
|
2017 Total
|
|
|||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
13
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
20
|
|
Accounts receivables and other
|
4
|
|
|
75
|
|
|
33
|
|
|
112
|
|
|
44
|
|
|||||
Investment properties
|
617
|
|
|
—
|
|
|
—
|
|
|
617
|
|
|
1,007
|
|
|||||
Property, plant and equipment
|
—
|
|
|
749
|
|
|
30
|
|
|
779
|
|
|
490
|
|
|||||
Equity accounted investments
|
568
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|
—
|
|
|||||
Other long-term assets
|
—
|
|
|
88
|
|
|
—
|
|
|
88
|
|
|
44
|
|
|||||
Assets classified as held for sale
|
$
|
1,202
|
|
|
$
|
920
|
|
|
$
|
63
|
|
|
$
|
2,185
|
|
|
$
|
1,605
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other
|
$
|
11
|
|
|
$
|
173
|
|
|
$
|
9
|
|
|
$
|
193
|
|
|
$
|
212
|
|
Non-recourse borrowings of managed entities
|
259
|
|
|
360
|
|
|
—
|
|
|
619
|
|
|
1,212
|
|
|||||
Liabilities associated with assets classified as held for sale
|
$
|
270
|
|
|
$
|
533
|
|
|
$
|
9
|
|
|
$
|
812
|
|
|
$
|
1,424
|
|
10.
|
EQUITY ACCOUNTED INVESTMENTS
|
|
Ownership Interest
1
|
|
Carrying Value
|
||||||||
AS AT DEC. 31
(MILLIONS) |
2018
|
|
2017
|
|
2018
|
|
|
2017
|
|
||
Real estate
|
|
|
|
|
|
|
|
||||
Associates
|
|
|
|
|
|
|
|
||||
Core office
|
7 – 23%
|
|
10 – 23%
|
|
$
|
107
|
|
|
$
|
123
|
|
Core retail
2
|
n/a
|
|
34%
|
|
n/a
|
|
|
8,845
|
|
||
LP Investments and other
|
6 – 90%
|
|
12 – 90%
|
|
1,173
|
|
|
1,563
|
|
||
Joint ventures
|
|
|
|
|
|
|
|
||||
Core office
|
15 – 56%
|
|
15 – 56%
|
|
8,258
|
|
|
8,112
|
|
||
Core retail
2
|
12 – 68%
|
|
n/a
|
|
11,159
|
|
|
n/a
|
|
||
LP Investments and other
|
12 – 90%
|
|
12 – 90%
|
|
2,252
|
|
|
954
|
|
||
|
|
|
|
|
22,949
|
|
|
19,597
|
|
||
Infrastructure
|
|
|
|
|
|
|
|
||||
Associates
|
|
|
|
|
|
|
|
||||
Utilities
|
11 – 50%
|
|
11 – 39%
|
|
339
|
|
|
1,279
|
|
||
Transport
|
26 – 58%
|
|
26 – 58%
|
|
4,100
|
|
|
4,639
|
|
||
Data infrastructure
|
45%
|
|
45%
|
|
1,705
|
|
|
1,607
|
|
||
Other
|
22 – 50%
|
|
20 – 40%
|
|
232
|
|
|
162
|
|
||
Joint ventures
|
|
|
|
|
|
|
|
||||
Energy
|
50%
|
|
50%
|
|
1,121
|
|
|
1,013
|
|
||
Other
|
50%
|
|
50%
|
|
139
|
|
|
93
|
|
||
|
|
|
|
|
7,636
|
|
|
8,793
|
|
||
Private equity
|
|
|
|
|
|
|
|
||||
Associates
|
|
|
|
|
|
|
|
||||
Norbord
|
42%
|
|
40%
|
|
1,287
|
|
|
1,364
|
|
||
Other
|
13 – 90%
|
|
14 – 90%
|
|
656
|
|
|
1,023
|
|
||
|
|
|
|
|
1,943
|
|
|
2,387
|
|
||
Renewable power and other
|
|
|
|
|
|
|
|
||||
Renewable power associates
|
14 – 60%
|
|
16 – 50%
|
|
685
|
|
|
509
|
|
||
Other equity accounted investments
3
|
18 – 85%
|
|
12 – 85%
|
|
434
|
|
|
708
|
|
||
|
|
|
|
|
1,119
|
|
|
1,217
|
|
||
Total
|
$
|
33,647
|
|
|
$
|
31,994
|
|
1.
|
Joint ventures or associates in which the ownership interest is greater than
50%
represent investments for which control is either shared or does not exist resulting in the investment being equity accounted.
|
2.
|
On August 28, 2018, a subsidiary of the company acquired all outstanding shares of GGP Inc. other than those shares previously held by the company and its affiliates. At this time, the company took control of the entity and it ceased to be accounted for using the equity method. There are a number of joint ventures within our core retail operations that are now included in the company’s consolidated financial results. Refer to Note 5 of the consolidated financial statements for additional information on the acquisition of GGP Inc.
|
3.
|
Carrying value of joint ventures in other equity accounted investments is
$395 million
(2017 –
$346 million
).
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS)
|
Real Estate
|
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Renewable Power
and Other |
|
|
2018 Total
|
|
|
2017 Total
|
|
||||||
Balance, beginning of year
|
$
|
19,597
|
|
|
$
|
8,793
|
|
|
$
|
2,387
|
|
|
$
|
1,217
|
|
|
$
|
31,994
|
|
|
$
|
24,977
|
|
Net additions (disposals)
|
(8,068
|
)
|
|
(811
|
)
|
|
(638
|
)
|
|
(255
|
)
|
|
(9,772
|
)
|
|
5,063
|
|
||||||
Acquisitions through business combinations
|
12,379
|
|
|
15
|
|
|
328
|
|
|
30
|
|
|
12,752
|
|
|
231
|
|
||||||
Share of comprehensive income
|
980
|
|
|
303
|
|
|
128
|
|
|
195
|
|
|
1,606
|
|
|
1,728
|
|
||||||
Distributions received
|
(1,519
|
)
|
|
(121
|
)
|
|
(221
|
)
|
|
(42
|
)
|
|
(1,903
|
)
|
|
(732
|
)
|
||||||
Foreign exchange
|
(420
|
)
|
|
(543
|
)
|
|
(41
|
)
|
|
(26
|
)
|
|
(1,030
|
)
|
|
727
|
|
||||||
Balance, end of year
|
$
|
22,949
|
|
|
$
|
7,636
|
|
|
$
|
1,943
|
|
|
$
|
1,119
|
|
|
$
|
33,647
|
|
|
$
|
31,994
|
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||
AS AT DEC. 31
(MILLIONS) |
Current Assets
|
|
|
Non-Current Assets
|
|
|
Current Liabilities
|
|
|
Non-Current Liabilities
|
|
|
Current Assets
|
|
|
Non-Current Assets
|
|
|
Current Liabilities
|
|
|
Non-Current Liabilities
|
|
||||||||
Real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Associates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Core office
|
$
|
15
|
|
|
$
|
1,998
|
|
|
$
|
12
|
|
|
$
|
457
|
|
|
$
|
18
|
|
|
$
|
1,671
|
|
|
$
|
14
|
|
|
$
|
456
|
|
Core retail
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,028
|
|
|
37,840
|
|
|
948
|
|
|
13,063
|
|
||||||||
LP Investments and other
|
86
|
|
|
3,430
|
|
|
56
|
|
|
966
|
|
|
410
|
|
|
6,554
|
|
|
204
|
|
|
2,788
|
|
||||||||
Joint ventures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Core office
|
1,789
|
|
|
33,245
|
|
|
2,766
|
|
|
13,998
|
|
|
1,531
|
|
|
31,351
|
|
|
2,225
|
|
|
13,762
|
|
||||||||
Core retail
|
832
|
|
|
40,136
|
|
|
734
|
|
|
16,537
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
||||||||
LP Investments and other
|
686
|
|
|
11,645
|
|
|
776
|
|
|
5,256
|
|
|
166
|
|
|
3,312
|
|
|
343
|
|
|
803
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Infrastructure
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Associates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Utilities
|
289
|
|
|
2,227
|
|
|
325
|
|
|
1,391
|
|
|
631
|
|
|
9,068
|
|
|
756
|
|
|
4,891
|
|
||||||||
Transport
|
1,507
|
|
|
15,676
|
|
|
1,871
|
|
|
6,358
|
|
|
1,532
|
|
|
16,876
|
|
|
1,387
|
|
|
6,951
|
|
||||||||
Data infrastructure
|
447
|
|
|
6,692
|
|
|
438
|
|
|
2,902
|
|
|
464
|
|
|
6,281
|
|
|
561
|
|
|
2,968
|
|
||||||||
Other
|
118
|
|
|
659
|
|
|
117
|
|
|
117
|
|
|
40
|
|
|
371
|
|
|
36
|
|
|
121
|
|
||||||||
Joint ventures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Energy
|
165
|
|
|
5,034
|
|
|
144
|
|
|
2,813
|
|
|
139
|
|
|
4,741
|
|
|
139
|
|
|
2,716
|
|
||||||||
Other
|
13
|
|
|
216
|
|
|
5
|
|
|
89
|
|
|
17
|
|
|
228
|
|
|
8
|
|
|
51
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Private equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Associates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Norbord
|
509
|
|
|
4,574
|
|
|
363
|
|
|
1,204
|
|
|
709
|
|
|
2,374
|
|
|
356
|
|
|
728
|
|
||||||||
Other
|
930
|
|
|
2,187
|
|
|
628
|
|
|
1,140
|
|
|
2,001
|
|
|
18,122
|
|
|
3,124
|
|
|
13,192
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Renewable power and other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Renewable power associates
|
182
|
|
|
2,845
|
|
|
93
|
|
|
974
|
|
|
153
|
|
|
2,536
|
|
|
115
|
|
|
1,080
|
|
||||||||
Other equity accounted investments
|
1,081
|
|
|
53
|
|
|
142
|
|
|
152
|
|
|
800
|
|
|
60
|
|
|
90
|
|
|
100
|
|
||||||||
|
$
|
8,649
|
|
|
$
|
130,617
|
|
|
$
|
8,470
|
|
|
$
|
54,354
|
|
|
$
|
9,639
|
|
|
$
|
141,385
|
|
|
$
|
10,306
|
|
|
$
|
63,670
|
|
|
2018
|
|
2017
|
||||||||||||
AS AT DEC. 31
(MILLIONS) |
Public Price
|
|
|
Carrying Value
|
|
|
Public Price
|
|
|
Carrying Value
|
|
||||
GGP
1
|
n/a
|
|
|
n/a
|
|
|
$
|
7,570
|
|
|
$
|
8,844
|
|
||
Norbord
|
$
|
925
|
|
|
$
|
1,287
|
|
|
1,176
|
|
|
1,364
|
|
||
Other
|
36
|
|
|
—
|
|
|
286
|
|
|
201
|
|
||||
|
$
|
961
|
|
|
$
|
1,287
|
|
|
$
|
9,032
|
|
|
$
|
10,409
|
|
1.
|
Our investment in GGP was consolidated as at December 31, 2018 and therefore has not been included in current year figures.
|
11.
|
INVESTMENT PROPERTIES
|
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Fair value, beginning of year
|
$
|
56,870
|
|
|
$
|
54,172
|
|
Additions
|
3,069
|
|
|
593
|
|
||
Acquisitions through business combinations
|
33,024
|
|
|
5,851
|
|
||
Dispositions
1
|
(8,555
|
)
|
|
(6,169
|
)
|
||
Fair value changes
|
1,610
|
|
|
1,021
|
|
||
Foreign currency translation
|
(1,709
|
)
|
|
1,402
|
|
||
Fair value, end of year
|
$
|
84,309
|
|
|
$
|
56,870
|
|
1.
|
Includes amounts reclassified to held for sale.
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Core office
|
|
|
|
||||
United States
|
$
|
15,237
|
|
|
$
|
14,827
|
|
Canada
|
4,245
|
|
|
4,597
|
|
||
Australia
|
2,391
|
|
|
2,480
|
|
||
Europe
|
1,331
|
|
|
1,040
|
|
||
Brazil
|
329
|
|
|
327
|
|
||
Core retail
|
17,607
|
|
|
—
|
|
||
LP Investments and other
|
|
|
|
||||
LP Investments office
|
8,438
|
|
|
6,275
|
|
||
LP Investments retail
|
3,414
|
|
|
3,412
|
|
||
Logistics
|
183
|
|
|
1,942
|
|
||
Mixed-use
|
12,086
|
|
|
2,315
|
|
||
Multifamily
|
4,151
|
|
|
3,925
|
|
||
Triple net lease
|
5,067
|
|
|
4,804
|
|
||
Self-storage
|
931
|
|
|
1,854
|
|
||
Student housing
|
2,417
|
|
|
1,353
|
|
||
Manufactured housing
|
2,369
|
|
|
2,206
|
|
||
Other investment properties
|
4,113
|
|
|
5,513
|
|
||
|
$
|
84,309
|
|
|
$
|
56,870
|
|
Valuation Technique
|
|
Significant Unobservable Inputs
|
|
Relationship of Unobservable Inputs to Fair Value
|
|
Mitigating Factors
|
Discounted cash flow analysis
1
|
|
• Future cash flows – primarily driven by net operating income
|
|
• Increases (decreases) in future cash flows increase (decrease) fair value
|
|
• Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) fair value
|
|
• Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
|
|
|
• Terminal capitalization rate
|
|
• Increases (decreases) in terminal capitalization rate decrease (increase) fair value
|
|
• Increases (decreases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from terminal capitalization rates
|
|
|
• Investment horizon
|
|
• Increases (decreases) in the investment horizon decrease (increase) fair value
|
|
• Increases (decreases) in the investment horizon tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
|
1.
|
Certain investment properties are valued using the direct capitalization method instead of a discounted cash flow model. Under the direct capitalization method, a capitalization rate is applied to estimated current year cash flows.
|
|
2018
|
|
2017
|
||||||||||||
AS AT DEC. 31
|
Discount Rate
|
|
|
Terminal Capitalization Rate
|
|
|
Investment Horizon (years)
|
|
Discount
Rate
|
|
|
Terminal Capitalization Rate
|
|
|
Investment Horizon (years)
|
Core office
|
|
|
|
|
|
|
|
|
|
|
|
||||
United States
|
6.9
|
%
|
|
5.6
|
%
|
|
12
|
|
7.0
|
%
|
|
5.8
|
%
|
|
13
|
Canada
|
6.0
|
%
|
|
5.4
|
%
|
|
10
|
|
6.1
|
%
|
|
5.5
|
%
|
|
10
|
Australia
|
7.0
|
%
|
|
6.2
|
%
|
|
10
|
|
7.0
|
%
|
|
6.1
|
%
|
|
10
|
Brazil
|
9.6
|
%
|
|
7.7
|
%
|
|
6
|
|
9.7
|
%
|
|
7.6
|
%
|
|
7
|
Core retail
|
7.1
|
%
|
|
6.0
|
%
|
|
12
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
LP Investments and other
|
|
|
|
|
|
|
|
|
|
|
|
||||
LP Investments office
|
10.2
|
%
|
|
7.0
|
%
|
|
6
|
|
10.2
|
%
|
|
7.5
|
%
|
|
7
|
LP Investments retail
|
8.9
|
%
|
|
7.8
|
%
|
|
9
|
|
9.0
|
%
|
|
8.0
|
%
|
|
10
|
Logistics
|
9.3
|
%
|
|
8.3
|
%
|
|
10
|
|
6.8
|
%
|
|
6.2
|
%
|
|
10
|
Mixed-use
|
7.8
|
%
|
|
5.4
|
%
|
|
10
|
|
8.4
|
%
|
|
5.3
|
%
|
|
10
|
Multifamily
1
|
4.8
|
%
|
|
n/a
|
|
|
n/a
|
|
4.8
|
%
|
|
n/a
|
|
|
n/a
|
Triple net lease
1
|
6.3
|
%
|
|
n/a
|
|
|
n/a
|
|
6.4
|
%
|
|
n/a
|
|
|
n/a
|
Self-storage
1
|
5.7
|
%
|
|
n/a
|
|
|
n/a
|
|
5.8
|
%
|
|
n/a
|
|
|
n/a
|
Student housing
1
|
5.6
|
%
|
|
n/a
|
|
|
n/a
|
|
5.8
|
%
|
|
n/a
|
|
|
n/a
|
Manufactured housing
1
|
5.4
|
%
|
|
n/a
|
|
|
n/a
|
|
5.8
|
%
|
|
n/a
|
|
|
n/a
|
Other investment properties
1
|
7.0
|
%
|
|
n/a
|
|
|
n/a
|
|
5.8
|
%
|
|
n/a
|
|
|
n/a
|
1.
|
Multifamily, triple net lease, self-storage, student housing, manufactured housing and other investment properties are valued using the direct capitalization method. The rates presented as the discount rate represent the overall implied capitalization rate. The terminal capitalization rate and the investment horizon are not applicable.
|
12.
|
PROPERTY, PLANT AND EQUIPMENT
|
1.
|
Includes amounts reclassified to held for sale.
|
a)
|
Renewable Power
|
1.
|
Our wind property, plant and equipment is now being presented separately from solar and other.
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
North America
|
$
|
24,274
|
|
|
$
|
22,832
|
|
Colombia
|
6,665
|
|
|
5,401
|
|
||
Europe
|
3,748
|
|
|
1,088
|
|
||
Brazil
|
3,505
|
|
|
3,443
|
|
||
Other
1
|
679
|
|
|
826
|
|
||
|
$
|
38,871
|
|
|
$
|
33,590
|
|
1.
|
Other refers primarily to China, India, Chile and Uruguay in 2018 and South Africa, China, India, Malaysia and Thailand in 2017.
|
Valuation Technique
|
|
Significant Unobservable Inputs
|
|
Relationship of Unobservable Inputs to Fair Value
|
|
Mitigating Factors
|
Discounted cash flow analysis
|
|
• Future cash flows – primarily impacted by future electricity price assumptions
|
|
• Increases (decreases) in future cash flows increase (decrease) fair value
|
|
• Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) fair value
|
|
• Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
|
|
|
• Terminal capitalization rate
|
|
• Increases (decreases) in terminal capitalization rate decrease (increase) fair value
|
|
• Increases (decreases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from terminal capitalization rates
|
|
|
• Exit date
|
|
• Increases (decreases) in the exit date decrease (increase) fair value
|
|
• Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
|
|
North America
|
|
Brazil
|
|
Colombia
|
|
Europe
|
||||||||||||
AS AT DEC. 31
|
2018
|
|
2017
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
2017
|
Discount rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contracted
|
4.8 – 5.6%
|
|
4.9 – 6.0%
|
|
9.0
|
%
|
|
8.9
|
%
|
|
9.6
|
%
|
|
11.3
|
%
|
|
4.0 – 4.3%
|
|
4.1 – 4.5%
|
Uncontracted
|
6.4 – 7.2%
|
|
6.5 – 7.6%
|
|
10.3
|
%
|
|
10.2
|
%
|
|
10.9
|
%
|
|
12.6
|
%
|
|
5.8 – 6.1%
|
|
5.9 – 6.3%
|
Terminal capitalization rate
1
|
6.1 – 7.1%
|
|
6.2 – 7.5%
|
|
n/a
|
|
|
n/a
|
|
|
10.4
|
%
|
|
12.6
|
%
|
|
n/a
|
|
n/a
|
Exit date
|
2039
|
|
2037
|
|
2047
|
|
|
2032
|
|
|
2038
|
|
|
2037
|
|
|
2033
|
|
2031
|
1.
|
Terminal capitalization rate applies only to hydroelectric assets in North America and Colombia.
|
|
Total Generation Contracted under Power Purchase Agreements
|
|
Power Prices from Long-Term Power Purchase Agreements
(weighted average)
|
|
Estimates of Future Electricity Prices
(weighted average)
|
||||||||||||
AS AT DEC. 31, 2018
(MILLIONS) |
1 – 10 years
|
|
11 – 20 years
|
|
1 – 10 years
|
|
11 – 20 years
|
|
1 – 10 years
|
|
11 – 20 years
|
||||||
North America (prices in US$/MWh)
|
44
|
%
|
|
21
|
%
|
|
93
|
|
|
95
|
|
|
62
|
|
|
114
|
|
Brazil (prices in R$/MWh)
|
69
|
%
|
|
35
|
%
|
|
286
|
|
|
397
|
|
|
287
|
|
|
452
|
|
Colombia (prices in COP$/MWh)
|
22
|
%
|
|
—
|
%
|
|
201,000
|
|
|
—
|
|
|
252,000
|
|
|
354,000
|
|
Europe (prices in €/MWh)
|
72
|
%
|
|
25
|
%
|
|
93
|
|
|
111
|
|
|
79
|
|
|
92
|
|
b)
|
Infrastructure
|
Valuation Technique
|
|
Significant Unobservable Inputs
|
|
Relationship of Unobservable Inputs to Fair Value
|
|
Mitigating Factors
|
Discounted cash flow analysis
|
|
• Future cash flows
|
|
• Increases (decreases) in future cash flows increase (decrease) fair value
|
|
• Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) fair value
|
|
• Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
|
|
|
• Terminal capitalization multiple
|
|
• Increases (decreases) in terminal capitalization multiple increases (decreases) fair value
|
|
• Increases (decreases) in terminal capitalization multiple tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from terminal capitalization multiple
|
|
|
• Investment horizon
|
|
• Increases (decreases) in the investment horizon decrease (increase) fair value
|
|
• Increases (decreases) in the investment horizon tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
|
|
Utilities
|
|
Transport
|
|
Energy
|
|
Data Infrastructure
|
|
Sustainable Resources
|
|||||||||||||
AS AT DEC. 31
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
2018
|
|
2017
|
Discount rates
|
7 – 14%
|
|
7 – 12%
|
|
10 – 13%
|
|
10 – 15%
|
|
12 – 15%
|
|
|
12 – 15%
|
|
|
13 – 15%
|
|
|
n/a
|
|
5 – 8%
|
|
5 – 8%
|
Terminal capitalization multiples
|
8x – 22x
|
|
7x – 21x
|
|
9x – 14x
|
|
9x – 14x
|
|
10x – 14x
|
|
|
8x – 13x
|
|
|
10x – 11x
|
|
|
n/a
|
|
12x - 23x
|
|
12x - 23x
|
Investment horizon / Exit date (years)
|
10 – 20
|
|
10 – 20
|
|
10 – 20
|
|
10 – 20
|
|
10
|
|
|
10
|
|
|
10
|
|
|
n/a
|
|
3 – 30
|
|
3 – 30
|
c)
|
Real Estate
|
|
Cost
|
|
Accumulated Fair Value Changes
|
|
Accumulated Depreciation
|
|
Total
|
||||||||||||||||||||||||
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||||||
Balance, beginning of year
|
$
|
5,854
|
|
|
$
|
5,783
|
|
|
$
|
798
|
|
|
$
|
694
|
|
|
$
|
(873
|
)
|
|
$
|
(825
|
)
|
|
$
|
5,779
|
|
|
$
|
5,652
|
|
Additions/(dispositions)
1
, net of assets reclassified as held for sale
|
352
|
|
|
(502
|
)
|
|
5
|
|
|
44
|
|
|
43
|
|
|
246
|
|
|
400
|
|
|
(212
|
)
|
||||||||
Acquisitions through business combinations
|
1,748
|
|
|
281
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,748
|
|
|
281
|
|
||||||||
Foreign currency translation
|
(241
|
)
|
|
292
|
|
|
(3
|
)
|
|
1
|
|
|
27
|
|
|
(13
|
)
|
|
(217
|
)
|
|
280
|
|
||||||||
Fair value changes
|
—
|
|
|
—
|
|
|
245
|
|
|
59
|
|
|
—
|
|
|
—
|
|
|
245
|
|
|
59
|
|
||||||||
Depreciation expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(303
|
)
|
|
(281
|
)
|
|
(303
|
)
|
|
(281
|
)
|
||||||||
Balance, end of year
|
$
|
7,713
|
|
|
$
|
5,854
|
|
|
$
|
1,045
|
|
|
$
|
798
|
|
|
$
|
(1,106
|
)
|
|
$
|
(873
|
)
|
|
$
|
7,652
|
|
|
$
|
5,779
|
|
1.
|
For accumulated depreciation, (additions)/dispositions.
|
d)
|
Private Equity and Other
|
1.
|
For accumulated depreciation, (additions)/dispositions.
|
13.
|
INTANGIBLE ASSETS
|
|
Cost
|
|
Accumulated Amortization and Impairment
|
|
Total
|
||||||||||||||||||
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||||||
Balance, beginning of year
|
$
|
15,251
|
|
|
$
|
6,733
|
|
|
$
|
(1,009
|
)
|
|
$
|
(660
|
)
|
|
$
|
14,242
|
|
|
$
|
6,073
|
|
Additions, net of disposals
|
266
|
|
|
(25
|
)
|
|
16
|
|
|
121
|
|
|
282
|
|
|
96
|
|
||||||
Acquisitions through business combinations
|
6,590
|
|
|
8,412
|
|
|
—
|
|
|
—
|
|
|
6,590
|
|
|
8,412
|
|
||||||
Amortization
|
—
|
|
|
—
|
|
|
(659
|
)
|
|
(442
|
)
|
|
(659
|
)
|
|
(442
|
)
|
||||||
Foreign currency translation
|
(1,803
|
)
|
|
131
|
|
|
110
|
|
|
(28
|
)
|
|
(1,693
|
)
|
|
103
|
|
||||||
Balance, end of year
|
$
|
20,304
|
|
|
$
|
15,251
|
|
|
$
|
(1,542
|
)
|
|
$
|
(1,009
|
)
|
|
$
|
18,762
|
|
|
$
|
14,242
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Brazil
|
$
|
6,270
|
|
|
$
|
7,537
|
|
United States
|
2,986
|
|
|
73
|
|
||
Canada
|
2,051
|
|
|
364
|
|
||
Australia
|
1,873
|
|
|
2,078
|
|
||
United Kingdom
|
1,860
|
|
|
1,489
|
|
||
Peru
|
1,118
|
|
|
1,144
|
|
||
Chile
|
928
|
|
|
1,100
|
|
||
India
|
843
|
|
|
130
|
|
||
Other
|
833
|
|
|
327
|
|
||
|
$
|
18,762
|
|
|
$
|
14,242
|
|
AS AT DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Infrastructure
|
(a)
|
|
$
|
11,641
|
|
|
$
|
9,900
|
|
Private equity
|
(b)
|
|
5,523
|
|
|
3,094
|
|
||
Real estate
|
(c)
|
|
1,179
|
|
|
1,188
|
|
||
Renewable power and other
|
|
|
419
|
|
|
60
|
|
||
|
|
|
$
|
18,762
|
|
|
$
|
14,242
|
|
a)
|
Infrastructure
|
•
|
Concession arrangements of
$4.2 billion
(2017 –
$5.1 billion
) at the company’s Brazilian regulated gas transmission operation that provide the right to charge a tariff over the term of the agreements. The agreements have an expiration date between 2039 and 2041, which is the basis for the company’s determination of its remaining useful life. Upon expiry of the agreements, the asset shall be returned to the government and the concession will be subject to a public bidding process.
|
•
|
Access agreements of
$1.8 billion
(2017 –
$2.0 billion
) with the users of the company’s Australian regulated terminal which are 100% take-or-pay contracts at a designated tariff rate based on the asset value. The access arrangements have an expiration date of 2051 and the company has an option to extend the arrangement an additional
49
years. The aggregate duration of the arrangements and the extension option represents the remaining useful life.
|
•
|
Concession arrangements totaling
$2.9 billion
(2017 –
$2.4 billion
) relating to the company’s Peruvian, Chilean and Indian toll roads which provide the right to charge a tariff to users of the roads over the terms of the concessions. The Chilean and Peruvian concessions have expiration dates of 2033 and 2043 while the Indian concessions have expiration dates ranging from 2027 to 2041. The company uses these expiration dates as a basis for determining the assets’ remaining useful lives.
|
•
|
Contractual customer relationships, customer contracts and proprietary technology of
$1.4 billion
(2017 – n/a) at the company’s North American residential energy infrastructure operations. These assets are amortized straight line over
10
to
20 years
.
|
•
|
Indefinite life intangible assets of
$653 million
(
2017
–
$297 million
). The increase from 2017 is primarily attributable to the brand value at our recently acquired North American residential energy infrastructure operations.
|
b)
|
Private Equity
|
•
|
Water and sewage concession agreements, the majority of which are arrangements with municipal governments across Brazil, of
$1.8 billion
(2017 –
$2.1 billion
). The concession agreements provide the company the right to charge fees to users over the terms of the agreements in exchange for water treatment services, ongoing and regular maintenance work on water distribution assets and improvements to the water treatment and distribution systems. The concession agreements have expiration dates that range from 2037 to 2055 which is the basis for the company’s determination of its remaining useful life. Upon expiry of the agreements, the assets shall be returned to the government.
|
•
|
Computer software, patents, trademarks and proprietary technology of
$2.1 billion
(2017
–
$126 million
). The increase from 2017 is primarily attributable to the proprietary technology at a service provider to the power generation industry, which we acquired in 2018. The proprietary technology has the potential to provide competitive advantages and product differentiation and is assessed to have a useful life of
15 years
.
|
c)
|
Real Estate
|
Valuation Technique
|
|
Significant Unobservable Input(s)
|
|
Relationship of Unobservable Input(s) to Fair Value
|
|
Mitigating Factor(s)
|
Discounted cash flow models
|
|
• Future cash flows
|
|
• Increases (decreases) in future cash flows increase (decrease) the recoverable amount
|
|
• Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in recoverable amounts from cash flows
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) the recoverable amount
|
|
• Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from discount rates
|
|
|
• Terminal capitalization rate
|
|
• Increases (decreases) in terminal capitalization rate decrease (increase) the recoverable amount
|
|
• Increases (decreases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from terminal capitalization rates
|
|
|
• Exit date
|
|
• Increases (decreases) in the exit date decrease (increase) the recoverable amount
|
|
• Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
|
14.
|
GOODWILL
|
1.
|
Includes adjustment to goodwill based on final purchase price allocation.
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Europe
|
$
|
2,131
|
|
|
$
|
1,257
|
|
Canada
|
1,923
|
|
|
432
|
|
||
Colombia
|
1,384
|
|
|
912
|
|
||
United States
|
1,306
|
|
|
400
|
|
||
Australia
|
876
|
|
|
1,026
|
|
||
Brazil
|
762
|
|
|
905
|
|
||
Other
|
433
|
|
|
385
|
|
||
|
$
|
8,815
|
|
|
$
|
5,317
|
|
AS AT DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Infrastructure
|
(a)
|
|
$
|
3,859
|
|
|
$
|
1,301
|
|
Private equity
|
(b)
|
|
2,411
|
|
|
1,555
|
|
||
Real estate
|
(c)
|
|
1,157
|
|
|
1,127
|
|
||
Renewable power
|
(d)
|
|
941
|
|
|
901
|
|
||
Asset management
|
|
|
328
|
|
|
312
|
|
||
Other
|
|
|
119
|
|
|
121
|
|
||
Total
|
|
|
$
|
8,815
|
|
|
$
|
5,317
|
|
a)
|
Infrastructure
|
b)
|
Private Equity
|
c)
|
Real Estate
|
d)
|
Renewable Power
|
Valuation Technique
|
|
Significant Unobservable Input(s)
|
|
Relationship of Unobservable Input(s) to Fair Value
|
|
Mitigating Factor(s)
|
Discounted cash flow models
|
|
• Future cash flows
|
|
• Increases (decreases) in future cash flows increase (decrease) the recoverable amount
|
|
• Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in recoverable amounts from cash flows
|
|
|
• Discount rate
|
|
• Increases (decreases) in discount rate decrease (increase) the recoverable amount
|
|
• Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from discount rates
|
|
|
• Terminal capitalization rate / multiple
|
|
• Increases (decreases) in terminal capitalization rate/multiple decrease (increase) the recoverable amount
|
|
• Increases (decreases) in terminal capitalization rates/multiple tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from terminal capitalization rates
|
|
|
• Exit date / terminal year of cash flows
|
|
• Increases (decreases) in the exit date/terminal year of cash flows decrease (increase) the recoverable amount
|
|
• Increases (decreases) in the exit date/terminal year of cash flows tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
|
15.
|
INCOME TAXES
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current income taxes
|
$
|
861
|
|
|
$
|
286
|
|
Deferred income tax expense / (recovery)
|
|
|
|
||||
Origination and reversal of temporary differences
|
143
|
|
|
499
|
|
||
Expense / (recovery) arising from previously unrecognized tax assets
|
(955
|
)
|
|
3
|
|
||
Change of tax rates and new legislation
|
(297
|
)
|
|
(175
|
)
|
||
Total deferred income taxes
|
(1,109
|
)
|
|
327
|
|
||
Income taxes
|
$
|
(248
|
)
|
|
$
|
613
|
|
FOR THE YEARS ENDED DEC. 31
|
2018
|
|
|
2017
|
|
Statutory income tax rate
|
26
|
%
|
|
26
|
%
|
Increase (reduction) in rate resulting from:
|
|
|
|
||
Change in tax rates and new legislation
|
(4
|
)
|
|
(3
|
)
|
International operations subject to different tax rates
|
(3
|
)
|
|
3
|
|
Taxable income attributable to non-controlling interests
|
(8
|
)
|
|
(9
|
)
|
Portion of gains subject to different tax rates
|
(4
|
)
|
|
(5
|
)
|
Recognition of deferred tax assets
|
(12
|
)
|
|
(2
|
)
|
Non-recognition of the benefit of current year’s tax losses
|
1
|
|
|
3
|
|
Other
|
1
|
|
|
(1
|
)
|
Effective income tax rate
|
(3
|
)%
|
|
12
|
%
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Non-capital losses (Canada)
|
$
|
685
|
|
|
$
|
657
|
|
Capital losses (Canada)
|
108
|
|
|
171
|
|
||
Losses (U.S.)
|
2,219
|
|
|
590
|
|
||
Losses (International)
|
645
|
|
|
861
|
|
||
Difference in basis
|
(13,161
|
)
|
|
(12,224
|
)
|
||
Total net deferred tax liabilities
|
$
|
(9,504
|
)
|
|
$
|
(9,945
|
)
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
One year from reporting date
|
$
|
16
|
|
|
$
|
—
|
|
Two years from reporting date
|
—
|
|
|
—
|
|
||
Three years from reporting date
|
2
|
|
|
6
|
|
||
After three years from reporting date
|
1,125
|
|
|
530
|
|
||
Do not expire
|
1,526
|
|
|
990
|
|
||
Total
|
$
|
2,669
|
|
|
$
|
1,526
|
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Revaluation of property, plant and equipment
|
$
|
1,302
|
|
|
$
|
(315
|
)
|
Financial contracts and power sale agreements
|
26
|
|
|
27
|
|
||
Fair value through OCI securities
1
|
10
|
|
|
5
|
|
||
Foreign currency translation
|
69
|
|
|
(43
|
)
|
||
Revaluation of pension obligation
|
7
|
|
|
1
|
|
||
Total deferred tax in other comprehensive income
|
$
|
1,414
|
|
|
$
|
(325
|
)
|
1.
|
Prior period amounts have not been restated (refer to Note 2 of the consolidated financial statements).
|
16.
|
CORPORATE BORROWINGS
|
AS AT DEC. 31
(MILLIONS) |
Maturity
|
|
Annual Rate
|
|
|
Currency
|
|
2018
|
|
|
2017
|
|
||
Term debt
|
|
|
|
|
|
|
|
|
|
|||||
Public – Canadian
|
Apr. 9, 2019
|
|
3.95
|
%
|
|
C$
|
|
$
|
440
|
|
|
$
|
478
|
|
Public – Canadian
|
Mar. 1, 2021
|
|
5.30
|
%
|
|
C$
|
|
257
|
|
|
278
|
|
||
Public – Canadian
|
Mar. 31, 2023
|
|
4.54
|
%
|
|
C$
|
|
441
|
|
|
479
|
|
||
Public – Canadian
|
Mar. 8, 2024
|
|
5.04
|
%
|
|
C$
|
|
367
|
|
|
398
|
|
||
Public – U.S.
|
Apr. 1, 2024
|
|
4.00
|
%
|
|
US$
|
|
749
|
|
|
748
|
|
||
Public – U.S.
|
Jan. 15, 2025
|
|
4.00
|
%
|
|
US$
|
|
500
|
|
|
500
|
|
||
Public – Canadian
|
Jan. 28, 2026
|
|
4.82
|
%
|
|
C$
|
|
633
|
|
|
689
|
|
||
Public – U.S.
|
Jun. 2, 2026
|
|
4.25
|
%
|
|
US$
|
|
496
|
|
|
496
|
|
||
Public – Canadian
|
Mar. 16, 2027
|
|
3.80
|
%
|
|
C$
|
|
366
|
|
|
397
|
|
||
Public – U.S.
|
Jan. 25, 2028
|
|
3.90
|
%
|
|
US$
|
|
648
|
|
|
—
|
|
||
Public – U.S.
|
Mar. 1, 2033
|
|
7.38
|
%
|
|
US$
|
|
250
|
|
|
250
|
|
||
Public – Canadian
|
Jun. 14, 2035
|
|
5.95
|
%
|
|
C$
|
|
309
|
|
|
335
|
|
||
Private – Japanese
|
Dec. 1, 2038
|
|
1.42
|
%
|
|
JPY
|
|
91
|
|
|
—
|
|
||
Public – U.S.
|
Sep. 20, 2047
|
|
4.70
|
%
|
|
US$
|
|
903
|
|
|
546
|
|
||
|
|
|
|
|
|
|
6,450
|
|
|
5,594
|
|
|||
Commercial paper and bank borrowings
|
—
|
%
|
|
C$
|
|
—
|
|
|
103
|
|
||||
Deferred financing costs
1
|
(41
|
)
|
|
(38
|
)
|
|||||||||
Total
|
$
|
6,409
|
|
|
$
|
5,659
|
|
1.
|
Deferred financing costs are amortized to interest expense over the term of the borrowing using the effective interest method.
|
17.
|
ACCOUNTS PAYABLE AND OTHER
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Accounts payable
|
$
|
6,873
|
|
|
$
|
5,158
|
|
Provisions
|
2,830
|
|
|
1,651
|
|
||
Other liabilities
|
14,286
|
|
|
11,156
|
|
||
Total
|
$
|
23,989
|
|
|
$
|
17,965
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current
|
$
|
14,337
|
|
|
$
|
11,148
|
|
Non-current
|
9,652
|
|
|
6,817
|
|
||
Total
|
$
|
23,989
|
|
|
$
|
17,965
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Plan assets
|
$
|
1,981
|
|
|
$
|
516
|
|
Less accrued benefit obligation:
|
|
|
|
||||
Defined benefit pension plan
|
(2,548
|
)
|
|
(685
|
)
|
||
Other post-employment benefits
|
(148
|
)
|
|
(90
|
)
|
||
Net liability
|
(715
|
)
|
|
(259
|
)
|
||
Less: net actuarial gains (losses) and other
|
(10
|
)
|
|
(2
|
)
|
||
Accrued benefit liability
|
$
|
(725
|
)
|
|
$
|
(261
|
)
|
18.
|
NON-RECOURSE BORROWINGS OF MANAGED ENTITIES
|
AS AT DEC. 31
|
Note
|
|
2018
|
|
|
2017
|
|
||
Subsidiary borrowings
|
(a)
|
|
$
|
8,600
|
|
|
$
|
9,009
|
|
Property-specific borrowings
|
(b)
|
|
103,209
|
|
|
63,721
|
|
||
Total
|
|
|
$
|
111,809
|
|
|
$
|
72,730
|
|
a)
|
Subsidiary Borrowings
|
(MILLIONS)
|
Real Estate
|
|
|
Renewable Power
|
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Residential Development
|
|
|
Total
|
|
||||||
2019
|
$
|
343
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
395
|
|
2020
|
1
|
|
|
330
|
|
|
275
|
|
|
—
|
|
|
603
|
|
|
1,209
|
|
||||||
2021
|
1,868
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|
1,954
|
|
||||||
2022
|
—
|
|
|
293
|
|
|
330
|
|
|
—
|
|
|
497
|
|
|
1,120
|
|
||||||
2023
|
292
|
|
|
—
|
|
|
510
|
|
|
—
|
|
|
184
|
|
|
986
|
|
||||||
Thereafter
|
—
|
|
|
1,705
|
|
|
878
|
|
|
—
|
|
|
353
|
|
|
2,936
|
|
||||||
Total – Dec. 31, 2018
|
$
|
2,504
|
|
|
$
|
2,328
|
|
|
$
|
1,993
|
|
|
$
|
52
|
|
|
$
|
1,723
|
|
|
$
|
8,600
|
|
Total – Dec. 31, 2017
|
$
|
3,214
|
|
|
$
|
1,665
|
|
|
$
|
2,102
|
|
|
$
|
380
|
|
|
$
|
1,648
|
|
|
$
|
9,009
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current
|
$
|
395
|
|
|
$
|
1,956
|
|
Non-current
|
8,205
|
|
|
7,053
|
|
||
Total
|
$
|
8,600
|
|
|
$
|
9,009
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
Local Currency
|
|
|
2017
|
|
|
Local Currency
|
|
||||||
U.S. dollars
|
$
|
6,846
|
|
|
US$
|
|
6,846
|
|
|
$
|
5,305
|
|
|
US$
|
|
5,305
|
|
Canadian dollars
|
1,613
|
|
|
C$
|
|
2,200
|
|
|
3,547
|
|
|
C$
|
|
4,460
|
|
||
Australian dollars
|
141
|
|
|
A$
|
|
200
|
|
|
156
|
|
|
A$
|
|
199
|
|
||
British pounds
|
—
|
|
|
£
|
|
—
|
|
|
1
|
|
|
£
|
|
1
|
|
||
Total
|
$
|
8,600
|
|
|
|
|
|
|
$
|
9,009
|
|
|
|
|
|
b)
|
Property-Specific Borrowings
|
(MILLIONS)
|
Real Estate
|
|
|
Renewable Power
|
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Residential Development
|
|
|
Total
|
|
||||||
2019
|
$
|
6,108
|
|
|
$
|
1,196
|
|
|
$
|
1,544
|
|
|
$
|
1,772
|
|
|
$
|
144
|
|
|
$
|
10,764
|
|
2020
|
11,895
|
|
|
788
|
|
|
1,112
|
|
|
1,003
|
|
|
105
|
|
|
14,903
|
|
||||||
2021
|
13,731
|
|
|
603
|
|
|
834
|
|
|
792
|
|
|
29
|
|
|
15,989
|
|
||||||
2022
|
5,742
|
|
|
1,346
|
|
|
839
|
|
|
986
|
|
|
40
|
|
|
8,953
|
|
||||||
2023
|
6,721
|
|
|
2,441
|
|
|
3,595
|
|
|
807
|
|
|
10
|
|
|
13,574
|
|
||||||
Thereafter
|
19,297
|
|
|
7,859
|
|
|
6,410
|
|
|
5,460
|
|
|
—
|
|
|
39,026
|
|
||||||
Total – Dec. 31, 2018
|
$
|
63,494
|
|
|
$
|
14,233
|
|
|
$
|
14,334
|
|
|
$
|
10,820
|
|
|
$
|
328
|
|
|
$
|
103,209
|
|
Total – Dec. 31, 2017
|
$
|
37,235
|
|
|
$
|
14,230
|
|
|
$
|
9,010
|
|
|
$
|
2,898
|
|
|
$
|
348
|
|
|
$
|
63,721
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Current
|
$
|
10,764
|
|
|
$
|
8,800
|
|
Non-current
|
92,445
|
|
|
54,921
|
|
||
Total
|
$
|
103,209
|
|
|
$
|
63,721
|
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
Local Currency
|
|
|
2017
|
|
|
Local Currency
|
|
||||||
U.S. dollars
|
$
|
72,747
|
|
|
US$
|
|
72,747
|
|
|
$
|
39,164
|
|
|
US$
|
|
39,164
|
|
British pounds
|
7,200
|
|
|
£
|
|
5,643
|
|
|
6,117
|
|
|
£
|
|
4,525
|
|
||
Canadian dollars
|
6,285
|
|
|
C$
|
|
8,573
|
|
|
5,272
|
|
|
C$
|
|
6,627
|
|
||
Brazilian reais
|
3,825
|
|
|
R$
|
|
14,820
|
|
|
2,677
|
|
|
R$
|
|
8,856
|
|
||
European Union euros
|
3,264
|
|
|
€$
|
|
2,846
|
|
|
766
|
|
|
€$
|
|
638
|
|
||
Australian dollars
|
2,968
|
|
|
A$
|
|
4,210
|
|
|
3,518
|
|
|
A$
|
|
4,506
|
|
||
Indian rupees
|
2,026
|
|
|
Rs
|
|
140,694
|
|
|
1,346
|
|
|
Rs
|
|
85,720
|
|
||
Colombian pesos
|
1,855
|
|
|
COP$
|
|
6,025,270
|
|
|
1,556
|
|
|
COP$
|
|
4,645,648
|
|
||
Korean won
|
1,613
|
|
|
₩
|
|
1,797,415
|
|
|
1,682
|
|
|
₩
|
|
1,795,518
|
|
||
Chilean unidades de fomento
|
837
|
|
|
UF
|
|
21
|
|
|
976
|
|
|
UF
|
|
22
|
|
||
Other currencies
|
589
|
|
|
n/a
|
|
n/a
|
|
|
647
|
|
|
n/a
|
|
n/a
|
|
||
Total
|
$
|
103,209
|
|
|
|
|
|
|
$
|
63,721
|
|
|
|
|
|
19.
|
SUBSIDIARY EQUITY OBLIGATIONS
|
AS AT DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Subsidiary preferred equity units
|
(a)
|
|
$
|
1,622
|
|
|
$
|
1,597
|
|
Limited-life funds and redeemable fund units
|
(b)
|
|
1,724
|
|
|
1,559
|
|
||
Subsidiary preferred shares and capital
|
(c)
|
|
530
|
|
|
505
|
|
||
Total
|
|
|
$
|
3,876
|
|
|
$
|
3,661
|
|
a)
|
Subsidiary Preferred Equity Units
|
AS AT DEC. 31
(MILLIONS, EXCEPT PER SHARE INFORMATION) |
Shares Outstanding
|
|
|
Cumulative Dividend Rate
|
|
|
Local Currency
|
|
2018
|
|
|
2017
|
|
||
Series 1
|
24,000,000
|
|
|
6.25
|
%
|
|
US$
|
|
$
|
562
|
|
|
$
|
551
|
|
Series 2
|
24,000,000
|
|
|
6.50
|
%
|
|
US$
|
|
537
|
|
|
529
|
|
||
Series 3
|
24,000,000
|
|
|
6.75
|
%
|
|
US$
|
|
523
|
|
|
517
|
|
||
Total
|
|
$
|
1,622
|
|
|
$
|
1,597
|
|
b)
|
Limited-Life Funds and Redeemable Fund Units
|
c)
|
Subsidiary Preferred Shares and Capital
|
AS AT DEC. 31
(MILLIONS, EXCEPT PER SHARE INFORMATION) |
Shares Outstanding
|
|
|
Cumulative Dividend Rate
|
|
|
Local Currency
|
|
2018
|
|
|
2017
|
|
||
Brookfield Property Split Corp
(“BOP Split”) senior preferred shares
|
|
|
|
|
|
|
|
|
|
||||||
Series 1
|
924,390
|
|
|
5.25
|
%
|
|
US$
|
|
$
|
23
|
|
|
$
|
23
|
|
Series 2
|
699,165
|
|
|
5.75
|
%
|
|
C$
|
|
13
|
|
|
14
|
|
||
Series 3
|
909,994
|
|
|
5.00
|
%
|
|
C$
|
|
17
|
|
|
18
|
|
||
Series 4
|
940,486
|
|
|
5.20
|
%
|
|
C$
|
|
17
|
|
|
19
|
|
||
BSREP II RH B LLC (“Manufactured Housing”) preferred capital
|
—
|
|
|
9.00
|
%
|
|
US$
|
|
249
|
|
|
249
|
|
||
Rouse Series A preferred shares
|
5,600,000
|
|
|
5.00
|
%
|
|
US$
|
|
142
|
|
|
142
|
|
||
Forest City Enterprises L.P. (“Forest City”) Preferred Capital
|
1,111,004
|
|
|
2.00
|
%
|
|
US$
|
|
29
|
|
|
—
|
|
||
BSREP II Vintage Estate Partners LLC (“Vintage Estates”) preferred shares
|
10,000
|
|
|
5.00
|
%
|
|
US$
|
|
40
|
|
|
40
|
|
||
Total
|
|
$
|
530
|
|
|
$
|
505
|
|
20.
|
SUBSIDIARY PUBLIC ISSUERS AND FINANCE SUBSIDIARY
|
AS AT AND FOR THE YEAR ENDED DEC. 31, 2018
(MILLIONS) |
The Corporation
1
|
|
|
BFI
|
|
|
BFL
|
|
|
BIC
|
|
|
Subsidiaries of the Corporation
other than BFI, BFL and BIC 2 |
|
|
Consolidating
Adjustments
3
|
|
|
The Company
Consolidated
|
|
|||||||
Revenues
|
$
|
810
|
|
|
$
|
43
|
|
|
$
|
53
|
|
|
$
|
163
|
|
|
$
|
62,984
|
|
|
$
|
(7,282
|
)
|
|
$
|
56,771
|
|
Net income attributable to shareholders
|
3,584
|
|
|
(46
|
)
|
|
(1
|
)
|
|
145
|
|
|
4,506
|
|
|
(4,604
|
)
|
|
3,584
|
|
|||||||
Total assets
|
59,105
|
|
|
4,330
|
|
|
13
|
|
|
3,296
|
|
|
271,534
|
|
|
(81,997
|
)
|
|
256,281
|
|
|||||||
Total liabilities
|
29,290
|
|
|
2,909
|
|
|
6
|
|
|
2,198
|
|
|
154,458
|
|
|
(29,730
|
)
|
|
159,131
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
AS AT AND FOR THE YEAR ENDED DEC. 31, 2017
(MILLIONS) |
The Corporation
1
|
|
|
BFI
|
|
|
BFL
|
|
|
BIC
|
|
|
Subsidiaries of the Corporation
other than BFI, BFL and BIC 2 |
|
|
Consolidating
Adjustments
3
|
|
|
The Company
Consolidated
|
|
|||||||
Revenues
|
$
|
168
|
|
|
$
|
30
|
|
|
$
|
43
|
|
|
$
|
22
|
|
|
$
|
44,908
|
|
|
$
|
(4,385
|
)
|
|
$
|
40,786
|
|
Net income attributable to shareholders
|
1,462
|
|
|
—
|
|
|
—
|
|
|
59
|
|
|
2,019
|
|
|
(2,078
|
)
|
|
1,462
|
|
|||||||
Total assets
|
53,688
|
|
|
1,060
|
|
|
757
|
|
|
3,761
|
|
|
206,907
|
|
|
(73,453
|
)
|
|
192,720
|
|
|||||||
Total liabilities
|
25,444
|
|
|
1,042
|
|
|
756
|
|
|
2,309
|
|
|
113,336
|
|
|
(30,039
|
)
|
|
112,848
|
|
1.
|
This column accounts for investments in all subsidiaries of the Corporation under the equity method.
|
2.
|
This column accounts for investments in all subsidiaries of the Corporation other than BFI, BFL and BIC on a combined basis.
|
3.
|
This column includes the necessary amounts to present the company on a consolidated basis.
|
21.
|
EQUITY
|
AS AT DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Preferred equity
|
(a)
|
|
$
|
4,168
|
|
|
$
|
4,192
|
|
Non-controlling interests
|
(b)
|
|
67,335
|
|
|
51,628
|
|
||
Common equity
|
(c)
|
|
25,647
|
|
|
24,052
|
|
||
|
|
|
$
|
97,150
|
|
|
$
|
79,872
|
|
a)
|
Preferred Equity
|
1.
|
Rate determined quarterly.
|
2.
|
Dividend rates are fixed for
5
to
6
years from the quarter end dates after issuance, June 30, 2011, March 31, 2012, June 30, 2012, December 31, 2012, September 30, 2013, March 31, 2014, June 30, 2014, December 31, 2014, December 31, 2015, December 31, 2016 and December 31, 2017, respectively and reset after
5
to
6
years to the
5
-year Government of Canada bond rate plus between
180
and
417
basis points.
|
3.
|
Dividend rate reset commenced December 31, 2017.
|
4.
|
Dividend rate reset commenced September 30, 2018.
|
b)
|
Non-controlling Interests
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Common equity
|
$
|
62,109
|
|
|
$
|
47,281
|
|
Preferred equity
|
5,226
|
|
|
4,347
|
|
||
Total
|
$
|
67,335
|
|
|
$
|
51,628
|
|
c)
|
Common Equity
|
AS AT DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Common shares
|
$
|
4,457
|
|
|
$
|
4,428
|
|
Contributed surplus
|
271
|
|
|
263
|
|
||
Retained earnings
|
14,244
|
|
|
11,864
|
|
||
Ownership changes
|
645
|
|
|
1,459
|
|
||
Accumulated other comprehensive income
|
6,030
|
|
|
6,038
|
|
||
Common equity
|
$
|
25,647
|
|
|
$
|
24,052
|
|
AS AT DEC. 31
|
2018
|
|
|
2017
|
|
Class A shares
1
|
955,057,721
|
|
|
958,688,000
|
|
Class B shares
|
85,120
|
|
|
85,120
|
|
Shares outstanding
1
|
955,142,841
|
|
|
958,773,120
|
|
Unexercised options and other share-based plans
2
|
42,086,712
|
|
|
47,474,284
|
|
Total diluted shares
|
997,229,553
|
|
|
1,006,247,404
|
|
1.
|
Net of
37,538,531
(2017 –
30,569,215
) Class A shares held by the company in respect of long-term compensation agreements.
|
2.
|
Includes management share option plan and escrowed stock plan.
|
AS AT AND FOR THE YEARS ENDED DEC. 31
|
2018
|
|
|
2017
|
|
Outstanding, beginning of year
1
|
958,773,120
|
|
|
958,168,417
|
|
Issued (repurchased)
|
|
|
|
||
Repurchases
|
(9,579,740
|
)
|
|
(3,448,665
|
)
|
Long-term share ownership plans
2
|
5,752,331
|
|
|
3,826,248
|
|
Dividend reinvestment plan and others
|
197,130
|
|
|
227,120
|
|
Outstanding, end of year
3
|
955,142,841
|
|
|
958,773,120
|
|
1.
|
Net of
30,569,215
Class A shares held by the company in respect of long-term compensation agreements as at December 31, 2017 (
December 31
, 2016 –
27,846,452
).
|
2.
|
Includes management share option plan and restricted stock plan.
|
3.
|
Net of
37,538,531
Class A shares held by the company in respect of long-term compensation agreements as at
December 31
, 2018 (December 31, 2017 –
30,569,215
).
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Net income attributable to shareholders
|
$
|
3,584
|
|
|
$
|
1,462
|
|
Preferred share dividends
|
(151
|
)
|
|
(145
|
)
|
||
Dilutive effect of conversion of subsidiary preferred shares
|
(105
|
)
|
|
—
|
|
||
Net income available to shareholders
|
$
|
3,328
|
|
|
$
|
1,317
|
|
|
|
|
|
||||
Weighted average – common shares
|
957.6
|
|
|
958.8
|
|
||
Dilutive effect of the conversion of options and escrowed shares using treasury stock method
|
19.8
|
|
|
21.2
|
|
||
Common shares and common share equivalents
|
977.4
|
|
|
980.0
|
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Expense arising from equity-settled share-based payment transactions
|
$
|
73
|
|
|
$
|
69
|
|
Expense/(Recovery) arising from cash-settled share-based payment transactions
|
(64
|
)
|
|
281
|
|
||
Total expense arising from share-based payment transactions
|
9
|
|
|
350
|
|
||
Effect of hedging program
|
75
|
|
|
(275
|
)
|
||
Total expense included in consolidated income
|
$
|
84
|
|
|
$
|
75
|
|
|
Number of Options (000’s)
1
|
|
|
Weighted- Average Exercise Price
|
|
|
Number of Options (000’s)
2
|
|
|
Weighted- Average Exercise Price
|
|
||
Outstanding at January 1, 2018
|
2,797
|
|
|
C$
|
12.35
|
|
|
34,893
|
|
|
US$
|
27.71
|
|
Granted
|
—
|
|
|
|
—
|
|
|
4,538
|
|
|
|
40.42
|
|
Exercised
|
(2,007
|
)
|
|
|
12.59
|
|
|
(2,492
|
)
|
|
|
23.58
|
|
Canceled
|
—
|
|
|
|
—
|
|
|
(197
|
)
|
|
|
34.81
|
|
Outstanding at December 31, 2018
|
790
|
|
|
C$
|
11.77
|
|
|
36,742
|
|
|
US$
|
29.52
|
|
1.
|
Options to acquire TSX listed Class A shares.
|
2.
|
Options to acquire NYSE listed Class A shares.
|
|
Number of Options (000’s)
1
|
|
|
Weighted- Average Exercise Price
|
|
|
Number of Options (000’s)
2
|
|
|
Weighted- Average Exercise Price
|
|
||
Outstanding at January 1, 2017
|
7,684
|
|
|
C$
|
15.63
|
|
|
31,483
|
|
|
US$
|
25.77
|
|
Granted
|
—
|
|
|
|
—
|
|
|
6,331
|
|
|
|
36.92
|
|
Exercised
|
(4,887
|
)
|
|
|
17.50
|
|
|
(2,149
|
)
|
|
|
24.36
|
|
Canceled
|
—
|
|
|
|
—
|
|
|
(772
|
)
|
|
|
33.28
|
|
Outstanding at December 31, 2017
|
2,797
|
|
|
C$
|
12.35
|
|
|
34,893
|
|
|
US$
|
27.71
|
|
1.
|
Options to acquire TSX listed Class A shares.
|
2.
|
Options to acquire NYSE listed Class A shares.
|
FOR THE YEARS ENDED DEC. 31
|
Unit
|
|
2018
|
|
|
2017
|
|
Weighted-average share price
|
US$
|
|
40.42
|
|
|
36.92
|
|
Weighted-average fair value per option
|
US$
|
|
5.38
|
|
|
4.92
|
|
Average term to exercise
|
Years
|
|
7.5
|
|
|
7.5
|
|
Share price volatility
1
|
%
|
|
16.3
|
|
|
18.9
|
|
Liquidity discount
|
%
|
|
25.0
|
|
|
25.0
|
|
Weighted-average annual dividend yield
|
%
|
|
1.9
|
|
|
2.1
|
|
Risk-free rate
|
%
|
|
2.8
|
|
|
2.3
|
|
1.
|
Share price volatility was determined based on historical share prices over a similar period to the average term to exercise.
|
|
|
|
Options Outstanding (000’s)
|
|||||||
Exercise Price
|
Weighted-Average Remaining Life
|
|
Vested
|
|
|
Unvested
|
|
|
Total
|
|
C$11.77
|
0.2 years
|
|
790
|
|
|
—
|
|
|
790
|
|
US$15.45
|
1.2 years
|
|
4,255
|
|
|
—
|
|
|
4,255
|
|
US$16.83 – US$23.37
|
2.8 years
|
|
5,160
|
|
|
—
|
|
|
5,160
|
|
US$25.21
–
US$30.59
|
5.5 years
|
|
8,410
|
|
|
3,293
|
|
|
11,703
|
|
US$33.75
–
US$36.32
|
6.1 years
|
|
2,873
|
|
|
2,115
|
|
|
4,988
|
|
US$36.88
–
US$44.24
|
8.6 years
|
|
1,197
|
|
|
9,439
|
|
|
10,636
|
|
|
|
|
22,685
|
|
|
14,847
|
|
|
37,532
|
|
|
|
|
Options Outstanding (000’s)
|
|||||||
Exercise Price
|
Weighted-Average Remaining Life
|
|
Vested
|
|
|
Unvested
|
|
|
Total
|
|
C$11.77
|
1.2 years
|
|
2,620
|
|
|
—
|
|
|
2,620
|
|
C$21.08
|
0.1 years
|
|
177
|
|
|
—
|
|
|
177
|
|
US$15.45
|
2.2 years
|
|
4,772
|
|
|
—
|
|
|
4,772
|
|
US$16.83 – US$23.37
|
3.8 years
|
|
5,834
|
|
|
—
|
|
|
5,834
|
|
US$25.21
–
US$30.59
|
6.5 years
|
|
6,858
|
|
|
5,967
|
|
|
12,825
|
|
US$33.75
–
US$36.32
|
7.1 years
|
|
2,049
|
|
|
3,191
|
|
|
5,240
|
|
US$36.88
–
US$37.75
|
9.1 years
|
|
—
|
|
|
6,222
|
|
|
6,222
|
|
|
|
|
22,310
|
|
|
15,380
|
|
|
37,690
|
|
1.
|
Share price volatility was determined based on historical share prices over a similar period to the average term to exercise.
|
|
Number of
Units (000’s)
|
|
|
Weighted- Average Exercise Price
|
|
|
Outstanding at January 1, 2018
|
27,772
|
|
|
$
|
29.01
|
|
Granted
|
5,815
|
|
|
40.39
|
|
|
Exercised
|
(6,484
|
)
|
|
21.40
|
|
|
Outstanding at December 31, 2018
|
27,103
|
|
|
$
|
33.27
|
|
|
Number of
Units (000’s)
|
|
|
Weighted- Average Exercise Price
|
|
|
Outstanding at January 1, 2017
|
24,167
|
|
|
$
|
27.77
|
|
Granted
|
3,700
|
|
|
36.88
|
|
|
Exercised
|
(95
|
)
|
|
21.74
|
|
|
Outstanding at December 31, 2017
|
27,772
|
|
|
$
|
29.01
|
|
|
DSUs
|
|
RSUs
|
||||||
|
Number
of Units
(000’s)
|
|
|
Number
of Units
(000’s)
|
|
|
|
Weighted- Average Exercise Price
|
|
Outstanding at January 1, 2018
|
14,944
|
|
|
10,920
|
|
|
C$
|
9.09
|
|
Granted and reinvested
|
466
|
|
|
—
|
|
|
|
—
|
|
Exercised and canceled
|
(773
|
)
|
|
(380
|
)
|
|
|
5.89
|
|
Outstanding at December 31, 2018
|
14,637
|
|
|
10,540
|
|
|
C$
|
9.21
|
|
|
DSUs
|
|
RSUs
|
||||||
|
Number
of Units
(000’s)
|
|
|
Number
of Units
(000’s)
|
|
|
|
Weighted- Average Exercise Price
|
|
Outstanding at January 1, 2017
|
14,986
|
|
|
10,920
|
|
|
C$
|
9.09
|
|
Granted and reinvested
|
661
|
|
|
—
|
|
|
|
—
|
|
Exercised and canceled
|
(703
|
)
|
|
—
|
|
|
|
—
|
|
Outstanding at December 31, 2017
|
14,944
|
|
|
10,920
|
|
|
C$
|
9.09
|
|
|
Unit
|
|
Dec. 31, 2018
|
|
|
Dec. 31, 2017
|
|
Share price on date of measurement
|
C$
|
|
52.32
|
|
|
54.72
|
|
Share price on date of measurement
|
US$
|
|
38.35
|
|
|
43.54
|
|
|
Unit
|
|
Dec. 31, 2018
|
|
|
Dec. 31, 2017
|
|
Share price on date of measurement
|
C$
|
|
52.32
|
|
|
54.72
|
|
Weighted-average fair value of a unit
|
C$
|
|
43.11
|
|
|
45.63
|
|
22.
|
REVENUES
|
FOR THE YEAR ENDED DEC. 31, 2018 (MILLIONS)
|
Asset
Management |
|
|
Real Estate
|
|
|
Renewable
Power |
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Residential Development
|
|
|
Corporate
Activities |
|
|
Total
Revenues |
|
||||||||
Revenue from contracts with customers
|
$
|
187
|
|
|
$
|
3,107
|
|
|
$
|
3,651
|
|
|
$
|
4,859
|
|
|
$
|
36,693
|
|
|
$
|
2,651
|
|
|
$
|
13
|
|
|
$
|
51,161
|
|
Other revenue
|
—
|
|
|
4,968
|
|
|
100
|
|
|
154
|
|
|
135
|
|
|
32
|
|
|
221
|
|
|
5,610
|
|
||||||||
|
$
|
187
|
|
|
$
|
8,075
|
|
|
$
|
3,751
|
|
|
$
|
5,013
|
|
|
$
|
36,828
|
|
|
$
|
2,683
|
|
|
$
|
234
|
|
|
$
|
56,771
|
|
FOR THE YEAR ENDED DEC. 31, 2018 (MILLIONS)
|
Asset
Management |
|
|
Real Estate
|
|
|
Renewable
Power |
|
|
Infrastructure
|
|
|
Private Equity
|
|
|
Residential Development
|
|
|
Corporate
Activities |
|
|
Total
Revenues |
|
||||||||
Goods and services provided at a point in time
|
$
|
—
|
|
|
$
|
1,118
|
|
|
$
|
79
|
|
|
$
|
201
|
|
|
$
|
28,860
|
|
|
$
|
2,651
|
|
|
$
|
13
|
|
|
$
|
32,922
|
|
Services transferred over a period of time
|
187
|
|
|
1,989
|
|
|
3,572
|
|
|
4,658
|
|
|
7,833
|
|
|
—
|
|
|
—
|
|
|
18,239
|
|
||||||||
|
$
|
187
|
|
|
$
|
3,107
|
|
|
$
|
3,651
|
|
|
$
|
4,859
|
|
|
$
|
36,693
|
|
|
$
|
2,651
|
|
|
$
|
13
|
|
|
$
|
51,161
|
|
23.
|
DIRECT COSTS
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Cost of sales
|
$
|
37,506
|
|
|
$
|
26,461
|
|
Compensation
|
3,954
|
|
|
2,795
|
|
||
Selling, general and administrative expenses
|
1,765
|
|
|
1,339
|
|
||
Property taxes, sales taxes and other
|
2,294
|
|
|
1,793
|
|
||
|
$
|
45,519
|
|
|
$
|
32,388
|
|
24.
|
FAIR VALUE CHANGES
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Investment properties
|
$
|
1,610
|
|
|
$
|
1,021
|
|
Transaction related gains, net of deal costs
|
1,132
|
|
|
637
|
|
||
Financial contracts
|
(189
|
)
|
|
(868
|
)
|
||
Impairments and provisions
|
(309
|
)
|
|
(344
|
)
|
||
Other fair value changes
|
(450
|
)
|
|
(25
|
)
|
||
|
$
|
1,794
|
|
|
$
|
421
|
|
25.
|
DERIVATIVE FINANCIAL INSTRUMENTS
|
AS AT DEC. 31
(MILLIONS) |
Note
|
|
2018
|
|
|
2017
|
|
||
Foreign exchange
|
(a)
|
|
$
|
33,298
|
|
|
$
|
28,573
|
|
Interest rates
|
(b)
|
|
38,490
|
|
|
18,433
|
|
||
Credit default swaps
|
(c)
|
|
56
|
|
|
43
|
|
||
Equity derivatives
|
(d)
|
|
1,375
|
|
|
1,384
|
|
||
|
|
|
|
|
|
||||
Commodity instruments
|
(e)
|
|
2018
|
|
|
2017
|
|
||
Energy (GWh)
|
|
|
14,752
|
|
|
28,808
|
|
||
Natural gas (MMBtu – 000’s)
|
|
|
63,076
|
|
|
48,163
|
|
a)
|
Foreign Exchange
|
|
Notional Amount
(U.S. Dollars)
|
|
Average Exchange Rate
|
||||||||||
(MILLIONS)
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
||
Foreign exchange contracts
|
|
|
|
|
|
|
|
||||||
Canadian dollars
|
$
|
4,959
|
|
|
$
|
2,619
|
|
|
0.76
|
|
|
0.78
|
|
British pounds
|
4,952
|
|
|
7,312
|
|
|
1.32
|
|
|
1.29
|
|
||
European Union euros
|
3,829
|
|
|
2,754
|
|
|
1.21
|
|
|
1.15
|
|
||
Australian dollars
|
3,781
|
|
|
3,610
|
|
|
0.74
|
|
|
0.75
|
|
||
Indian rupees
1
|
697
|
|
|
256
|
|
|
72.73
|
|
|
65.24
|
|
||
Chilean pesos
1
|
615
|
|
|
—
|
|
|
647
|
|
|
—
|
|
||
Korean won
1
|
561
|
|
|
578
|
|
|
1,102
|
|
|
1,100
|
|
||
Chinese yuan
1
|
543
|
|
|
346
|
|
|
6.85
|
|
|
6.72
|
|
||
Japanese yen
1
|
404
|
|
|
14
|
|
|
104.45
|
|
|
110.17
|
|
||
Colombian pesos
1
|
370
|
|
|
—
|
|
|
2,977
|
|
|
—
|
|
||
Brazilian reais
|
78
|
|
|
62
|
|
|
0.24
|
|
|
0.27
|
|
||
Other currencies
|
530
|
|
|
—
|
|
|
various
|
|
|
—
|
|
||
Cross currency interest rate swaps
|
|
|
|
|
|
|
|
||||||
Canadian dollars
|
4,167
|
|
|
2,442
|
|
|
0.75
|
|
|
0.76
|
|
||
European Union euros
|
1,914
|
|
|
1,914
|
|
|
1.06
|
|
|
1.06
|
|
||
Australian dollars
|
1,454
|
|
|
1,610
|
|
|
1.00
|
|
|
0.98
|
|
||
Japanese yen
1
|
750
|
|
|
750
|
|
|
113.32
|
|
|
113.33
|
|
||
British pounds
|
257
|
|
|
272
|
|
|
1.49
|
|
|
1.45
|
|
||
Colombian pesos
1
|
125
|
|
|
299
|
|
|
3,056
|
|
|
3,056
|
|
||
Other currencies
|
15
|
|
|
—
|
|
|
various
|
|
|
—
|
|
||
Foreign exchange options
|
|
|
|
|
|
|
|
||||||
British pounds
|
1,736
|
|
|
534
|
|
|
1.31
|
|
|
1.19
|
|
||
Indian rupee
1
|
500
|
|
|
—
|
|
|
67.95
|
|
|
—
|
|
||
Chinese yuan
1
|
500
|
|
|
—
|
|
|
7.10
|
|
|
—
|
|
||
European Union euros
|
463
|
|
|
1,801
|
|
|
1.15
|
|
|
1.21
|
|
||
Canadian dollars
|
—
|
|
|
1,000
|
|
|
—
|
|
|
0.76
|
|
||
Japanese yen
1
|
—
|
|
|
400
|
|
|
—
|
|
|
118.00
|
|
||
Other currencies
|
98
|
|
|
—
|
|
|
various
|
|
|
—
|
|
1.
|
Average rate is quoted using USD as base currency.
|
b)
|
Interest Rates
|
c)
|
Credit Default Swaps
|
d)
|
Equity Derivatives
|
e)
|
Commodity Instruments
|
|
2018
|
|
2017
|
||||||||||||||||||||
FOR THE YEARS ENDED DEC. 31
(MILLIONS)
|
Notional
|
|
|
Effective Portion
|
|
|
Ineffective Portion
|
|
|
Notional
|
|
|
Effective Portion
|
|
|
Ineffective Portion
|
|
||||||
Cash flow hedges
1
|
$
|
24,999
|
|
|
$
|
38
|
|
|
$
|
(3
|
)
|
|
$
|
10,254
|
|
|
$
|
42
|
|
|
$
|
(16
|
)
|
Net investment hedges
|
17,319
|
|
|
999
|
|
|
9
|
|
|
14,587
|
|
|
(748
|
)
|
|
—
|
|
||||||
|
$
|
42,318
|
|
|
$
|
1,037
|
|
|
$
|
6
|
|
|
$
|
24,841
|
|
|
$
|
(706
|
)
|
|
$
|
(16
|
)
|
1.
|
Notional amount does not include
6,040
GWh,
8,423
MMBtu – 000’s and
3,151
bbls – millions of commodity derivatives at
December 31, 2018
(
2017
–
15,586
GWh,
45,014
MMBtu – 000’s and
3,087
bbls – millions).
|
(MILLIONS)
|
Unrealized Gains During 2018
|
|
|
Unrealized Losses During 2018
|
|
|
Net Change During 2018
|
|
|
Net Change During 2017
|
|
||||
Foreign exchange derivatives
|
$
|
570
|
|
|
$
|
(113
|
)
|
|
$
|
457
|
|
|
$
|
(364
|
)
|
Interest rate derivatives
|
33
|
|
|
(50
|
)
|
|
(17
|
)
|
|
(15
|
)
|
||||
Credit default swaps
|
3
|
|
|
—
|
|
|
3
|
|
|
2
|
|
||||
Equity derivatives
|
87
|
|
|
(216
|
)
|
|
(129
|
)
|
|
169
|
|
||||
Commodity derivatives
|
27
|
|
|
(93
|
)
|
|
(66
|
)
|
|
(34
|
)
|
||||
|
$
|
720
|
|
|
$
|
(472
|
)
|
|
$
|
248
|
|
|
$
|
(242
|
)
|
|
2018
|
|
2017
|
|
|||||||||||||||
AS AT DEC. 31
(MILLIONS) |
<1 Year
|
|
|
1 to 5 Years
|
|
|
>5 Years
|
|
|
Total Notional
Amount
|
|
|
Total Notional
Amount
|
|
|||||
Fair value through profit or loss
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange derivatives
|
$
|
7,402
|
|
|
$
|
1,901
|
|
|
$
|
—
|
|
|
$
|
9,303
|
|
|
$
|
10,632
|
|
Interest rate derivatives
|
3,738
|
|
|
11,123
|
|
|
1,760
|
|
|
16,621
|
|
|
11,532
|
|
|||||
Credit default swaps
|
—
|
|
|
56
|
|
|
—
|
|
|
56
|
|
|
43
|
|
|||||
Equity derivatives
|
537
|
|
|
838
|
|
|
—
|
|
|
1,375
|
|
|
1,362
|
|
|||||
Commodity instruments
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy (GWh)
|
1,100
|
|
|
7,612
|
|
|
—
|
|
|
8,712
|
|
|
13,222
|
|
|||||
Natural gas (MMBtu – 000’s)
|
53,283
|
|
|
1,370
|
|
|
—
|
|
|
54,653
|
|
|
3,149
|
|
|||||
Elected for hedge accounting
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange derivatives
|
$
|
15,819
|
|
|
$
|
6,700
|
|
|
$
|
1,476
|
|
|
$
|
23,995
|
|
|
$
|
17,941
|
|
Interest rate derivatives
|
9,955
|
|
|
10,127
|
|
|
1,787
|
|
|
21,869
|
|
|
6,901
|
|
|||||
Equity derivatives
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|||||
Commodity instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Energy (GWh)
|
674
|
|
|
3,357
|
|
|
2,009
|
|
|
6,040
|
|
|
15,586
|
|
|||||
Natural gas (MMBtu – 000’s)
|
8,423
|
|
|
—
|
|
|
—
|
|
|
8,423
|
|
|
45,014
|
|
26.
|
MANAGEMENT OF RISKS ARISING FROM HOLDING FINANCIAL INSTRUMENTS
|
a)
|
Market Risk
|
b)
|
Credit Risk
|
c)
|
Liquidity Risk
|
1.
|
Represents the aggregated interest expense expected to be paid over the term of the obligations. Variable interest rate payments have been calculated based on current rates.
|
|
Payments Due by Period
|
||||||||||||||||||
AS AT DEC. 31, 2017
(MILLIONS) |
<1 Year
|
|
|
1 to 3 Years
|
|
|
4 to 5 Years
|
|
|
After 5 Years
|
|
|
Total
|
|
|||||
Principal repayments
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate borrowings
|
$
|
—
|
|
|
$
|
478
|
|
|
$
|
278
|
|
|
$
|
4,903
|
|
|
$
|
5,659
|
|
Non-recourse borrowings of managed entities
|
10,756
|
|
|
17,695
|
|
|
16,764
|
|
|
27,515
|
|
|
72,730
|
|
|||||
Subsidiary equity obligations
|
76
|
|
|
53
|
|
|
1,001
|
|
|
2,531
|
|
|
3,661
|
|
|||||
Interest expense
1
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate borrowings
|
259
|
|
|
494
|
|
|
462
|
|
|
1,433
|
|
|
2,648
|
|
|||||
Non-recourse borrowings
|
3,248
|
|
|
5,024
|
|
|
3,575
|
|
|
5,314
|
|
|
17,161
|
|
|||||
Subsidiary equity obligations
|
226
|
|
|
428
|
|
|
340
|
|
|
322
|
|
|
1,316
|
|
1.
|
Represents the aggregated interest expense expected to be paid over the term of the obligations. Variable interest rate payments have been calculated based on current rates.
|
27.
|
CAPI
TAL MANAGEMENT
|
28.
|
RELATED PARTY TRANSACTIONS
|
a)
|
Related Parties
|
b)
|
Key Management Personnel and Directors
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Salaries, incentives and short-term benefits
|
$
|
21
|
|
|
$
|
18
|
|
Share-based payments
|
90
|
|
|
54
|
|
||
|
$
|
111
|
|
|
$
|
72
|
|
c)
|
Related Party Transactions
|
FOR THE YEARS ENDED DEC. 31
(MILLIONS) |
2018
|
|
|
2017
|
|
||
Investment and other losses
|
$
|
—
|
|
|
$
|
(268
|
)
|
Management fees received
|
56
|
|
|
47
|
|
29.
|
OTHER INFORMATION
|
a)
|
Guarantees and Contingencies
|
b)
|
Supplemental Cash Flow Information
|
30.
|
SUBSEQUENT EVENTS
|
1.
|
I have reviewed this annual report on Form 40-F of Brookfield Asset Management Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;
|
4.
|
The issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the issuer’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting; and
|
5.
|
The issuer’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer’s auditors and the audit committee of the issuer’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer’s internal control over financial reporting.
|
|
|
|
|
|
|
|
|
|
/s/ J. Bruce Flatt
|
|
|
|
|
J. Bruce Flatt
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 40-F of Brookfield Asset Management Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;
|
4.
|
The issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the issuer’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting; and
|
5.
|
The issuer’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer’s auditors and the audit committee of the issuer’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer’s internal control over financial reporting.
|
|
|
|
|
|
|
|
|
|
/s/ Brian D. Lawson
|
|
|
|
|
Brian D. Lawson
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
(Principal Financial Officer)
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
|
|
|
|
By:
|
|
/s/ J. Bruce Flatt
|
|
|
|
|
J. Bruce Flatt
|
|
|
|
|
Chief Executive Officer
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
|
|
|
|
By:
|
|
/s/ Brian D. Lawson
|
|
|
|
|
Brian D. Lawson
|
|
|
|
|
Chief Financial Officer
|