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## USE OF PROCEEDS FROM FINANCING ISSUED DURING 2010 

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## EQUITY 

## Unitholders’ Equity 

Unitholders’ equity increased by $93.0 million between December 31, 2009 and December 31, 2010. $29.1 million was from proceeds received from the issuance of Stapled Units and the balance of the increase is due primarily to net earnings offset by the distributions paid to unitholders. 

The majority of the accumulated other comprehensive loss is made up of the net adjustment to the equity invested in U.S. Holdco with the REIT’s debt being held in U.S. dollars currently acting as a natural hedge against its total investment in U.S. dollars. 

## LIQUIDITY AND CAPITAL RESOURCES 

## Funds from Operations, Normalized Funds from Operations and Adjusted Funds from Operations 

Funds from operations (“FFO”), normalized funds from operations (“NFFO”) and adjusted funds from operations (“AFFO”) are not measures recognized under GAAP and do not have standardized meanings prescribed by GAAP. FFO, NFFO and AFFO should not be construed as alternatives to net earnings or cash provided by operations determined in accordance with GAAP as an indicator of the Trusts’ performance (see also “Non-GAAP Financial Measures”). However, FFO and AFFO are operating performance measures which are widely used by the real estate industry (and in particular, by a number of other Canadian real estate investment trusts). The Trusts have calculated FFO in accordance with the recommendations of the Real Property Association of Canada which does not include any adjustment for realized or unrealized losses on foreign exchange or derivative instruments in the calculation of FFO. The Trusts’ method of calculating FFO, NFFO and AFFO may differ from other issuers’ methods and accordingly may not be comparable to similar measures presented by other issuers. 

The use of FFO, NFFO and AFFO, combined with the required GAAP presentations, have been presented for the purpose of improving the understanding of operating results of the Trusts by the investing public. 

