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No. of Recommendations: 2
BAM excludes me from CC's. Hence, I can not ask these questions.

1. Will any of the new consortiums be buying assets or monetizing assets of any BAM or BAM related investments. Are their any provisions the outside investors discussed or signed off on in regards to related party transactions?

2. Would you please explain in detail the related party sale, gain and contract amendment with Great Lakes Hydro from 3Q09. Was this amendment identified in the prospectus prior to the transactions? Specifically look at the contract amendment on Brookfield Renewable Power which seemed unexpected, and I think was paid to BAM for $349M, and see if that was part of the realization gain on BAM books for 3Q09. I think the Q will spell it out. Interesting that BAM recorded 3 month net income of $112M. Would there have been a Net Loss had the related party realization gain of $346M not occurred? Was the $346M realization gain also part of the $349M contract amendment?

3. On page 7 of the Q3 / 2009 Supplemental Information you wrote the following, “We believe that our underlying values have increased by at least this much over the first nine months of the year with the result that our current deconsolidated debt to total capitalization ratio has improved from the 15% ratio at the beginning of 2009. Our proportionate debt-to-total-capitalization ratio was 44% at the beginning of the year and we believe that it also has improved as a result of increases in underlying values and lower debt levels.” Your stock price was at $15.27 on 12/31/08 and $22.71 on 9/30/09. Haven’t your ratios increased because of the stock price increase?

4. You have High-yield bonds and distressed debt of $411M on 9/30/09; this is up from $60M in June 2009. Are any of these assets related party assets? Does BAM categorize some related party purchases of investments to this section?

5. Please explain the Loans Receivable of $388M on 9/30/09. Again, is any of this from related parties?

6. Has the SEC or SEDAR issued comment letters to any of the consolidated entities other than Brookfield Homes? We already are aware of the SEC comment letter on Brookfield Homes.

7. It is my understanding that Trizec debt is partially owned by BAM. Please elaborate. What was cost and what is current carrying value? Are there any impairments? Is any of the Trizec of Brookfield Property consolidated debt in a special servicing situation, any delinquencies or delayed payments (even if accepted by lender)? You discussed CMBS financing in your shareholder letter, and that you primarily utilized “traditional mortgage financing.” Do you consider primarily interest only loans (i.e. 1 Liberty Plaza) as traditional? Does the ownership of Trizec paper at all conflict with your theory of leverage and excess liquidity offered to entities prior to the “crisis?”

8. Your 3Q09 shareholder letter stated, “Notwithstanding the challenging business environment, we recorded strong results for the quarter, generating cash flows from operations of $520 million, which compares favourably with $355 million last year. These results were assisted by our disposition of a portion of our investment in Canadian power plants..” Was any of this not a result of a related party transaction? Did any of this include the contract amendment of $349M?

9. BAM has a bit of hedging in most of their consolidated entities. Are any of the hedging gains, losses, mark to markets, as well as transactions being done by BAM related entities?

10. Why did Brookfield Properties buy certain assets from Western Forest Products (a consolidated BAM entity)? We know that Western Forest is distressed, and wondering if there were synergies as to why Brookfield Properties bought the interests?

11. You mentioned in your 3Q09 shareholder letter, “"Unfortunately, many new investors entered the market over the past four years and made at least one of three fatal mistakes. They either: (1) paid too much; (2) had growth assumptions that were too high; or worst of all, (3) employed excessive debt leverage." You wrote that in connection with Infrastructure Assets. Yet, please describe if you think that any of the large purchases by BAM over the last 4 years were also part of such a group. Multiplex and Trizec seem to fit that mold. Please explain.

12. You also mentioned in the 3Q09 letter, “And while the capital markets’ recovery has allowed a number of property companies to refloat themselves on their own, there are many other situations where the clock is ticking and where major deleveraging may be required. Those who have no credible sponsor with the necessary capital represent suitable opportunities for us to assist with their recapitalizations.” Please elaborate that in regards to Trizec. It seems as though the LTV and current conditions will not allow for a refinance. The LTV is generally known to be underwater.

13. I find it interesting that your 3Q09 shareholder letter mentioned, “simple-to-understand assets.” To me, the structure of BAM as an entity, with all her tentacles, seems hardly “simple-to-understand.” Please elaborate.

14. Do you consider Capital Securities and Preferred Stock to be Equity or Liabilities?

Here are some of my BAM notes. I have not updated in a while. I feel my thesis remains intact.
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