FORM 20-F/A Brookfield Property Partners L.P. - Brookfield Asset ...

Additionally, as part of our strategy for our office property platform is to focus on markets underpinnedby major financial, energy and professional services businesses, a significant downturn in one or more of theindustries in which these businesses operate would also adversely affect our results of operations.We face risks associated with the use of debt to finance our business, including refinancing risk.We incur debt in the ordinary course of our business and therefore are subject to the risks associated withdebt financing. These risks, including the following, may adversely affect our financial condition and results ofoperations:• cash flows may be insufficient to meet required payments of principal and interest;• payments of principal and interest on borrowings may leave insufficient cash resources to payoperating expenses;• we may not be able to refinance indebtedness on our properties at maturity due to business andmarket factors, including: disruptions in the capital and credit markets; the estimated cash flows ofour properties and other assets; the value of our properties and other assets; and financial,competitive, business and other factors, including factors beyond our control; and• if refinanced, the terms of a refinancing may not be as favorable as the original terms of the relatedindebtedness.Our operating entities have a significant degree of leverage on their assets. Highly leveraged assets areinherently more sensitive to declines in revenues, increases in expenses and interest rates, and adverse marketconditions. A leveraged company’s income and net assets also tend to increase or decrease at a greater rate thanwould otherwise be the case if money had not been borrowed. As a result, the risk of loss associated with aleveraged company, all other things being equal, is generally greater than for companies with comparatively lessdebt.We rely on our operating entities to provide our company with the funds necessary to make distributionson our units and meet our financial obligations. The leverage on our assets may affect the funds available to ourcompany if the terms of the debt impose restrictions on the ability of our operating entities to make distributionsto our company. In addition, our operating entities will generally have to service their debt obligations beforemaking distributions to our company or their parent entity.Leverage may also result in a requirement for liquidity, which may force the sale of assets at times of lowdemand and/or prices for such assets.We may also incur indebtedness under future credit facilities, such as the revolving credit facility weexpect to obtain from Brookfield, or other debt-like instruments, in addition to any asset-level indebtedness. Wemay also issue debt or debt-like instruments in the market in the future, which may or may not be rated. Shouldsuch debt or debt-like instruments be rated, a credit downgrade will have an adverse impact on the cost of suchdebt.If we are unable to refinance our indebtedness on acceptable terms, or at all, we may need to dispose ofone or more of our properties or other assets upon disadvantageous terms. In addition, prevailing interest rates orother factors at the time of refinancing could increase our interest expense, and if we mortgage property to securepayment of indebtedness and are unable to make mortgage payments, the mortgagee could foreclose upon suchproperty or appoint a receiver to receive an assignment of our rents and leases. This may adversely affect ourability to make distributions or payments to our unitholders and lenders.11