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

BROOKFIELD PROPERTY PARTNERS L.P.Unaudited Pro forma Financial StatementsThe following unaudited pro forma financial statements of Brookfield Property Partners L.P. (the “company”)adjust the company’s balance sheet as at March 31, 2012 and statements of income for the three months endedMarch 31, 2012 and the year ended December 31, 2011 to give effect to the acquisition of the Business (asdefined below) by the company from Brookfield Asset Management Inc. (“Brookfield” or the “parentcompany”), the spin-off (as defined below) and related transactions as if such transactions occurred as ofMarch 31, 2012, in the case of the unaudited pro forma balance sheet, or as January 1, 2011, in the case of theunaudited pro forma statements of income. Prior to the acquisition, Brookfield intends to effect a reorganization(the “reorganization”) so that an interest in its commercial property operations (the “Business”), including itsoffice, retail, multi-family and industrial, and opportunistic assets, is acquired by holding entities that will beowned by Brookfield Property L.P. (the “property partnership”).Brookfield intends to transfer a portion of the limited partnership interests it holds in the company to holders ofits Class A limited voting shares and Class B limited voting shares through a special dividend (the “spin-off”).Immediately following the reorganization and spin-off, the company’s sole direct investment will be an interestin the Business through the company’s ownership of limited partnership interests in the property partnership. Thecompany will control the strategic, financial and operating policy decisions of the property partnership pursuantto a voting agreement to be entered into between the company and Brookfield and, through its ownership of thelimited partnership units of the property partnership, benefit from the property partnership’s activities. Whollyownedsubsidiaries of Brookfield will serve as the general partners for both the company and the propertypartnership.The unaudited pro forma financial statements reflect adjustments for the reorganization, the spin-off, thefollowing related transactions and resulting tax effects:• Acquisition of interests in Brookfield’s Australian properties through participating loan notes• Issuance of $750 million of Capital Securities to Brookfield as partial consideration for the Businessacquired by the company• Issuance of $15 million of Preferred Shares by certain holding entities• Issuance of partnership units by the company as partial consideration for the business acquired by thecompany• Reorganization of the legal structure through which the Business is held, including the issuance ofcertain inter-company debt between the property partnership and the Holding Entities, resulting inchanges in the effective tax rate and the tax basis of certain investments• Annual Management Fees of $50 million paid by the company to Brookfield pursuant to a MasterServices Agreement• Exclusion of Brookfield’s 2% investment in Howard Hughes CorporationThe unaudited pro forma financial statements have been prepared based upon currently available information andassumptions deemed appropriate by management. The unaudited pro forma financial statements are provided forinformation purposes only and are not intended to represent, or be indicative of, the results that would haveoccurred had the transactions reflected in the pro forma adjustments been effected on the dates indicated.The accounting for certain of the above transactions will require the determination of pro forma adjustments togive effect to the transactions on the dates indicated. The pro forma adjustments are preliminary and have beenmade solely for the purpose of providing unaudited pro forma financial information. Differences between thesepreliminary estimates and the final accounting for these transactions may occur and these differences could havea material impact on the accompanying unaudited pro forma financial statements. Further, integration costs, inany, that may be incurred upon consummation of the aforementioned transactions have been excluded from theunaudited pro forma statements of income.All financial data in these unaudited pro forma financial statements is presented in U.S. dollars and has beenprepared in accordance with International Financial Reporting Standards as issued by the InternationalAccounting Standards Board.PF-3