BROOKFIELD PROPERTIES
Crisis Leadership Following September 11th, 2001
Prepared by Elizabeth O'Neil under the
supervision of Professor Kathleen Slaughter
Copyright CO 2002, Ivey Management Services
It was 4 P.M. on September 11 , 200 I, and
Bruce Flatt, president and chief executive
officer (CEO) of Brookfield Properties Corporation,
had just approved the press release that would
be issued shortly from the Toronto, Canada,
office. The World Trade Center (WTC) in
New York City had been the target of terrorist
bombings that morning and the city was in
chaos . Brookfield 's four properties adjacent to .
the WTC appeared to have sustained consider-
able damage, but no concrete information
was available. It seemed that employees and ten-
ants had been safely evacuated. Flatt had to
quickly formulate an action plan to manage this
crisis and then get some input from Ric Clark
and John Zuccotti, who ran Brookfield's U.S.
operations.
BROOKFIELD PROPERTIES CORPORATION
Brookfield Properties Corporation was a pub-
licly held North American commercial real estate
Version: (A) 2003-01-13
company wbose origins were in sports facility
management.
In 1924, Canadian Arena Corporation, the pre-
decessor to Brookfield, built the Montreal Forum
to provide facilities for hockey and other sporting
and cultural events. Until 1972, Brookfield's
earnings were derived principally from the owner-
ship of tbe Montreal Forum and the Montreal
Canadiens of tbe National Hockey League.
During the 1960s, Brookfield expanded into
various facets of the real estate business and, in
1976, the company began to shift its focus to
commercial real estate interests.
In 1990, a strategic decision was made to
focus Brookfield's investments in premier
office properties in select, high-growth, supply-
constrained North American markets, including
New York, Toronto, Boston, Calgary, Denver and
Minneapolis. Over the next few years, the accu-
mulation of these assets was completed through
various purchases, including that of the former
real estate assets of BCE Inc., Olympia & York,
and Gentra Inc. (see Exhibit I).
 Number Effective Brookfield's
of . RetalV Leasable Ownership Effective
JUNE 30, 2002 Properties Leased Office Other Area Interest Interest

ooo's ooo's 000's ooo's

% Sq. Ft. Sq.Ft. Sq. Ft. % Sq. Ft.

NEW YORK
World Financial Center
Tower One 1 99.4% 1,520 108 1,628 100% 1,628
Tower Two 1 100.0% 2,455 36 2,491 100% 2,491
Tower Four 1 100.0')?, 1,711 89 1,800 51% 917
Retail 72.3% - 287 287 100% 287
One Liberty Plaza 1 93.0% 2,194 20 2,214 100% 2,214
245 Park Avenue 1 99.9% 1,631 62 1,693 100% 1,693
Development sites
GIBC World Markets Tower 1 - 1,200 - 1,200 100% 1,200
Penn Station 1 - 2,500 - 2,500 100% 2,500

7 97.9% 13,211 602 13,813 12,930

TORONTO
BCE Place
Canada Trust Tower 1 99.6% 1,127 18 1,145 50% 573
Bay Wellington Tower 1 97.6% 1,295 42 1,337 l00"'{' 1,337
Retail, parking and office 2 98.3% 137 809 946 75% 705
Exohange Tower Block 2 98.4% 1,137 256 1,393 51% 708
HSBC Building 1 94.2% 188 37 225 100% 225
Queen's Quay Terminal 1 97.6% 428 74 502 100% 502
Other
Deve/opmBnt $_
Bay-Adelaide Centre
3

1
92.4%

-
1,198

1,000
137

800
1,335

1.800
28%

50".4
380

900
HudIon's Bay Centre 1 - 535 557 1,092 25% 273
BCE Place III 1 - 800 - 800 65% 520

14 96.9% 7,845 2,730 10,575 6,123

BOSTON
53 Slate Street 1 99.9% 1,091 70 1,161 51% 592
75 Slate Street 1 93.8% 742 260 1,002 51% 511

2 97.4% 1,833 330 2,163 1,103

DENVER
Republic Plaza
Office 1 95.1% 1,247 - 1,247 100% .• 1~47
o-Iopment and other 1 - 400 548 946 100% 946
Trade Center 2 90.1% 767 43 810 100% • 1110
<:oIorado State Bank Bu~<f1ll9 1 97.5% 412 - 412 50% 206

, 5 93.9% 2,826 591 3,417 ,. 3,211

Exhibit 1 Portfolio Listing--CommerciaJ Properties by Region

 Number I;ffectiw Brookfield's
of RetelV LlKlsabIe OWn8rshlp Effective
JUNE 30, 2002 - Properties "LeaSed Office Other ' Area Interest Interest
,
OOO's 000'$ 000'$ 000'$
. % Sq. Ft, Sq. Ft. Sq. Ft. % Sq, Ft

CAL<Wiv
Bankers Hall 3 91,4% 1,955 750 2,705 100% 2,705
AlthA_Place 2 99.6% 1,427 254 1,681 50% 841
PeIJo.Canada Ceritre 2 98.0% 1,707 245 1,952 50"1. , 976
Otl1er III , '-
I 81.2%. ,- 108 loe 100% 108
.
'" 8 95.5% 5.089 1,357 6,446 4,630
MINNEAPOLIS
33 South Sixtli Street 2 88.0% 1,082 695 1,777 100% 1,777
(formerly City Center)
Dam Plaza • 'Ii 2 93.8% 593- 638 1,231 100% 1,231
-
" 4 90.4% 1,675 .", 1,333 3,008 3,008
OTHER
Royal Centre, Vancouver 1 92.4% 493 362 855 100% 855
Other , 9 96,6% '2 ,920 884 3,804 100% 3,,804

10 95.3% 3,413 1,246 4,659 4,659

Total portfolio '

", 50 96.1% 35,892 6,189 44,081 35,664
Less other sha,E)holders' 1,212
interests",
"
"

Brookfield's net effective 34,452

ownership interest

Source: Company files.

In September of 2001, Brookfield's market
capitalization was approximately US$9 billion,
with 80 percent of the assets held in the United
States. Of the company 's nearly 2,000 employ-
ees throughout North America, two-thirds were
operating employees located in Brookfield's
properties.
In addition to commercial property manage-
ment, Brookfield operated an office management
services business, which managed over L20 mil-
lion square feet of real estate, and owned a
master-planned residential development busi-
ness, which accounted for approximately eight
percent of Brookfield's asset value and con-
structed 3,000 single family homes annually (see
Exhib it 2).
Brookfield was an inter-listed company
whose shares traded 011 both the New York and
Toronto stock exchanges under the symbol BPO.
COMPETITIVE STRENGTHS
Success at Brookfield was attributed to the
strong teamwork demonstrated by employees,
the customer service excellence that was a part of
 Brookfield Properties Corporation

I I
Master-Planned
Commercial Services
Residential
Properties Business
Communities

I 1 I
United States
United States Brookfield
California, Colorado,
New York, LePage Johnson
Virginia, Maryland,
Boston, Virginia Controls
Florida

I I I
Canada Brookfield Canada
Toronto, Residential Toronto, Calgary,
Calgary Services Ltd. Edmonton

Exhibil2 Brookfield at a Glance

Source: Company fiies.

the corporate culture, and the company's strate-
gic portfolio management.
In addition, senior management believed the
company was well positioned for continued
growth based on the following factors .
Unique, High-Quality Portfolio
Brookfield's portfolio of landmark office proper-
ties, including the World Financial Center complex
in Manhattan and BCE Place in Toronto, was rec-
ognized as unique in North America. The office
properties were modern, averaged 1.4 million
square feet in size and were focused in the central
business districts of select, major North American
cities. Eighty-five percent of Brookfield's portfolio
was located in cities known for their ongoing high
demand, such as New York, Boston and Toronto,
ensuring stable, long-term growth.
Superior Quality Tenants
The qUality and location of Brookfield's office
properties, combined with a high commitment
to service excellence, attracted highly successful
organizations as tenants. Brookfield counted
Merrill Lynch, JP Morgan Chase, Goldman Sachs,
crnc World Markets, RBC Financial Group,
Petro-Canada, Lehman Brothers and TO Canada
Trust among its clients. These clients possessed
high credit quality and therefore ensured the long-
term sustainabiHty of rental revenues.
Financial Strength
A conservative debt structure, quality streams of
cash flow and the ability to retain cash flow pro-
vided financial strength and flexibility to fuel strate-
gic growth. Brookfield's financial performance was
captured in its Fact Sheet (see Exhibit 3).
 Btt>Okfle!1 Prop>erllesCo'rpc..tlon, with US$9 billion fn assets. owns, develops and manages premIer North American office
properifes. The Brookfield portfolio includes 50 commercial propeT1les and development sites totaling 44 minion square feet
and 120 million square feet under management.

The Brookfield Difference

50
Premier Brookfield is an Investment In Quality. The company's
strategic focus on Investing in premier quality office
t
Properties From left to right:
assets In select markets is continuing to deliver solid financial
Bankers Hall, Calgary
performance. shareholder value and Industry leadership. Republic Plaza, Denver
BCE Place, Toronto
World Financial Center, New York
53 State Street, Boston
elBe World Markets Tower. New York
Premier Assets Track Record of Performance Internal Growth Built-In
• Brookfield's portfolio is • During 2001, we achieved 15% • With in-place rents 30%
44 distinguished by the size and increase In FFO' growth per below market and contractual
Million quality of the assets, which share, and 13% in 012002. step-ups built into leases,
Square Feet attract and retain high credit the company Is delivering
quality tenants, resulting In a 6% operatIng Income growth
long-teon high quality stream Proactive Lease Management from currently owned
of cashflow for shareholders. • Leased o....er 9 million square feet offICe space.
in 2000 and 2001, o....er 4 times
the amount of space contractually
Brookfield's Properties Feature expiring and 450,000 square feel Financial Flexibility
10 • An average size of 1.4 million
square feet
in 01 2002. • Inillattves completed
Year Average in 2001 generated o....er
• A 15 year average age USS1 billion In cashflow
Lease Term • Technologically advanced Long~Term Lease Profile with plans for $750 mUllon
infrastructure • Brookfield's leases a....erage In 2002.

~
• Locations proximate to major 10 years with ....irtually no major
transportation hubs. leases expiring until 2005 .
• Funds from operations
"----------.--------.---------1
FFO Growth Per Share Strong Financial Position Stock Information
US Dollars Nearly 100% of the commercial property Symbol: BPO
• FFO per share including actual debt is fixed rate and non-recourse. The
termination and other gains as a....erage maturity Is 11 years. Exchanges: New York, Toronto
in 1999, 2000, 2001 and similar
gains ;n 2002 March 2002
$2.53' Shares
Debt to Total Capitalization
$2.32 ' r- Outstanding: 161 million
- Markel Value 53%
- t; - Book Value 60%
$1 .88' - ~.
Total Market
$1.52' = <.1 Commercial Debl Capitalization: US$9. 1 billion
$1.13 F - Non-recourse 97"10

n
$0.78 r- '! . Interest Coverage

$~3
- 01 2002 FFO 2.0x
- Mark-to-Market Rents 2.7x
Capital Base US$2.7 billion
1996 1997 1998 1999 2000 2001 2oo2E ,8Ho oKFI ELo

Exhibit 3 Fact Sheet (Corllinued)

 From lef( to right:
Petro-Canada Centre, Calgary
One Liberty Ptaza, New York
Toronto

Strategic Prtortties
Maintain record 01 growth In FFO per share of greater than 15% and 10lai cash return on equity 0120%
Low-tisk, high-return developmem of office properties on existing sites.
Sale of partnership Interests with institulionallnveslors 10 surface value in malure assets.
AcqUISIIlOO of premier offICe assets In existing or new markets, consistent with current portfolio.

Portfolio Distribution Geographic DIS1rlbution

25 bV Square Feet (By net operating Income)

Major Toronto 80%

Properties 24% New York
Represent Toronto
Bos'on
Boston
5%
80% Denver
Of the 7%
Portfolio MinneapoliS CaJgary
7% 14%

Value Per Share Comparison Average Lease Term (Years)

Fully diluted shares outstanding: Brookfield's leasing profile Is one of the strongest in the industry with one of the
165.5 million lowest rollover rates o( any major NOIth American office company.
(US Dollars)
$23,50
$22,50
$20,00

$12 .32

Book Ma~t NAV NAV Brookfield's average lease term across the portfolio is 10 years.
Value Value Anatysl Brookfield
Consenu8 In New York and Boston, virtually no leases expire until 2005.

Five Year Common Share Dividend History Expected earnings Release Oates Investor Relations Contacts
(US dollars) 1991l 1999 2000 2001 2002 I~::!:~;~;~; Vyse,
MM_ 31
Jun. 30 0.07 0.10 0.12 0.13
0.10 I~::::";'~:;~:~'~Communications
(416) 369-6246
Sept 30 0.10 : (41 6) 865-1288
Dec. 31 0,09 0.12 0.13 0.10 : kvyseObrookfieidp<opertles,com

"Effective September 2001, Brookfield Inlt,~/.<i ..

I _,~..:-,,_"__--,_______ I ':::,:: ~:~C~O~':.;y~, Vice Presk\enl,
quarterly dMdend payments replacing the I - II
semi-annual payment schedul8. Recoff1 dates
818 set on the first business day of
March, June, September and December.

Exhibit 3 (Continued)
Source: Company files,
Market Leadership
The second largest office property company
in North America by total market capitalization-
over US$9 billion-Brookfield had established a
leadership position in the key North American
office rri~kets with premier properties in prime
downtown locations. In addition,
• Brookfield's master-planned commuoity busi-
ness was the largest Canadian-based residential
development operation and among the largest
borne builders and land developers in the
United States; and
• The services business was the largest provider
of property management services in Canada.
Commitment to Customer
Service Excellence
Brookfield was a leader in the real estate indus-
try in providing innovative and timely customer
service programs at the property level and for
each individual tenant. This commitment was
backed by extensive training and proactive
recruitment practices that were embraced by the
Brookfield team.
BROOKFIELD'S MANAGEMENT
TEAM AND CORPORATE CULTURE
Brookfield was a lean. fairly nat organization
managed by a team of senior employees who
worked hard to maintain the company 's reputa-
tion for excellence (see Exhibits 4 and 5) .
Roles tended to be fluid , with employees
often taking on projects and responsibilities that
were not fonnally a part of their job description .
The pace was fast but disciplined, and after a
long day it was not uncommon for the group to
socialize together.
Within the tight-knit group, communication
was not a problem. [n describing the effective-
ness of communications at Brookfield, Melissa
Coley, director of arts and events marketing in
New York, said, "It's easy to know what's going
on around here. Our offices are close to each
other, we eat lunch together, we just know what's
going on. In fact, if Ric didn't stop by my office
once a day to ask how things were going, I'd
wonder what was up."
In Ric Clark's words:
This company was built around sman, dedicated,
energetic, decent hard-working people. Since 90
percent of our New York employees have been with
Brookfield for over 10 years, it makes sense that
our corporate culture in New York is collegial. Our
philosopby is "lead by example, share the credit,
be a team player," and that's what we try to do
around here. As pan of that team, 1 try to make
myself available to anyone who has an idea or an
opinion to share-actually, more people than I'd
care to admit bave my personal cell phone number.
Outside hiring did happen when necessary,
but whenever possible, employees were grown
in-house. Clark's own career path was an excel-
lent example of this progression. He began his
career as a financial analyst, then became an ana-
lyst in the leasing department, and eventually
worked his way up to become the director of
leasing. He was then made chief operating offi-
cer (COO) for Brookfield's U.S. operations and
eventually became president of the same.
Having been involved with new hires at all
levels, Clark cared "more about what a person is
all about than what his or her background is."
This philosophy was well respected by his col-
leagues, one of whom remarked: "Ric's got a
great gut. He sure knows how to pick 'em! "
Bruce Flatt's colleagues also exhibited a great
deal of trust in and respect for his leadership.
One of his senior vice-presidents (SVPs) said
about his style:
Bruce is very, very good at recognizing the efforts
of others in a genuine way. He always remembers
to stop to say a si mple "thank you" and lavishes
praise publicly when things go well. And be is
always calm and even-tempered, even when some-
thing goes wrong, which is a valuable talent when
you are trying to encourage others to assume
greater responsibilities, take risks and be creative.
He is a true leader wbom others gladly follow.
 Gordon Arnell brings with him more than 25 years of real estate Industry
experience. Gordon joined Brookfield's predecessor company, Carena
Developments Limited, in 1989 as President and CEO and was subsequenlly
appointed Chairman and CEO of Brookfield. In April 2000, he assumed the
role of Chairman.

Prior to joining Brookfield, Gordon was a senior executive at several major

real estate companies, including Oxford Development Group Ltd. of Edmonton,
Trizec Corporation Ltd. of Calgary, and Trilea Centres Inc. A lawyer by training,
he also practiced litigation and commercial law in Calgary.

GORDON ARNELL Gordon holds Bachelor of Arts and Bachelor of Law degrees from the
CHAIRMAN , BROOKFielD University of Alberta and was called to the Bar of Alberta in 1958. He is a
PROPERnES CORPORAnON Director of Brookfield Properties Corporation, Brookfield Financial Properties
Ltd . and BPO Properties Ltd.

Ric is the President and Chief Executive of Brookfield's US commercial

operations. Ric has been with Brookfield and its New York based affiliate,
Brookfield Financial Properties (and its predecessor company, Olympia and
York) since 1984 in various senior roles including Chief Operating Officer,
Executive Vice PreSident, and Director of Leasing.

Ric is a Certified Public Accountant and holds a business degree from

the Indiana University of Pennsylvania. He is a member of the Brookfield
Financial Properties' Board of Directors, a member of The Real Estate Board
of New York's Board of Governors and a member of the Lincoln Centre Real
Estate and Construction Council.
R,c CLARK
PRESIDENT AND CEO, US
CoMMERCiAl OPERATIONS

Steve Douglas was appointed Executive Vice President and Chief Financial
Officer in July 2001, following four years as Senior Vice President and Chief
Financial Officer and three years in various senior management positions
at Brookfield. In his current role, he is responsible for corporate finance,
reporting, tax and treasury for Brookfield and its subsidiaries. Prior to JOining
the company, Steve was affiliated with Ernst and Young in Toronto.

Steve is a Chartered Accountant and holds a Bachelor of Commerce degree

from Laurentian University in Sudbury, Ontario.

STEVEN DOUGLAS
EVP AND CFO, BROOKFIELD
PROPERTIES CORPORATION

Exhibit 4 Management Team Bios

 Katherine Vyse joined Brookfield in early 2000. Her 14 year business career
includes a similar role at a major North American real estate company and
10 years in the Financial Services industry. Katherine is currently responsible
for expanding Brookfield's investor relations program and developing new
investor relations and corpcrate communications vehicles and programs.

Katherine holds an MBA degree Irom the Ivey School of Business, a

Bachelor of Arts degree from the University of Western Ontario in London,
Ontario and a Retail Management Diploma from Sheridan College in
Oakville. Katherine is a member of the Board of Directors of Canadian
Investor Relations Institute (CIRI), Ontario Chapter.
KATHERINE VVSE
SR. VP, INVESTOR RELATIONS
AND COMMUNICATIONS

Mark Brown was appcinted Senior Vice President, Finance, in July 2001.
Mark joined Brookfield in 2000 and has primary respcnsibility for managing
the finance function for the U.S. commercial operations and contributing to
the company's corporate financial strategies.

P·rior to joining Brookfield, Mark spent 9 years with Salomon Smith Barney
and Citicorp Real Estate, Inc. He holds a Masters of Business Administration
from York University and a Bachelor of Commerce degree from Laurentian
University.

MARK BROWN
SVP, F,NANCE

John E. Zuccotti, Deputy Chairman of Brookfield Properties Corporation, has

specialized throughout his career in planning, housing, real estate and
municipal law. He has played a leading role in the development process of
major residential and commercial projects in the New York metropclitan area,
served as director or trustee of many planning and development boards and
has lectured at numerous institutions, including Harvard, Columbia and Yal".
John also served as the first Deputy Mayor of the city of New York from 1975
through 1977.

Prior to joining Brookfield , John served as President and Chief Executive

Officer of Olympia and York Companies (U.S.A.) and as a Partner in the law
JOHN Zuccaro
firms of Brown & Wood and Tufa & ZuccoUi.
D EPUTY CHAIRMAN,
BROOKFIELD P ROPEAllES
John graduated from Princeton University in 1959 and received his law
degree from Yale University Law School in 1963. He was an officer in the
United States Army.

Exhibit 4 (Continued)
 Bruce has been President and Chief Executive Officer since April 2000.
Before joining Brookfield, he held a number of senior management positions
at Hees International Bancorp Inc. from 1989 to 1992, and also worked for
Arthur Young International, which is now part of Ernst & Young.

Bruce is a Chartered Accountant and holds a business degree from

the University of Manitoba. Bruce is a director of Brookfield Properties
Corporation, EdperPartners limited, Noranda Inc. and Brascan Corporation.

BRUCE FLATT
PRESIDENT AND CEO,
BROOKFIELD PROPERTIES

Dennis Friedrich was appointed Chief Operating Officer of Brookfield's US

commercial operations in July 2001 following his role as head of Strategic
Initiatives for the US property portfolio. In his current position, Dennis oversees
Brookfield's commercial property operations comprising 18 million square
feet of premier office space in New York, Boston, Denver and Minneapolis.

Prior to joining Brookfield, Dennis was co-head of Jones Lang LaSalle's

Tenant Advisory practice in New York. He holds a business degree in finance
from Baruch College and is a member of the Real Estate Board of New York.

DENNIS FRIEDRtCH
EVP AND COO,
BROOKFIELD PROPERTIES

President and CEO of Brookfield's Canadian operations since February 1998,

David is atso Chairman of Brookfield LePage Johnson Controls. Through his
15 year career at Brookfield, David held the positions of President and Chief
Executive Officer of Brookfield Commercial Properties Ltd., President and
Chief Executive Officer of Brookfield Management Services Ltd. and a number
of other management positions at related real estate companies. While at
Brookfield, David has been involved in several major property acquisitions and
new contracts, including the acquisition of the landmark Bankers Hall and Rfth
Ave. Ptace complexes in Calgary.

David started his career with Cadillac Fairview and Cambridge Leaseholds.
David Arthur
He holds a Master of Science in Urban Land Economics from ttie University
President and CEO,
of British Columbia and Bachelor of Urban and Regional Planning from the
Canadian Operations
University of Waterloo. David is President of the Canadian Institute of Public
and Private Real Estate Companies (CIPPREC) and is a member of the
Young Presidents' Organization (YPO).

J
 Gordon Arnell
Chairman

- John Zuccotti
Vice Chairman

Bruce Flatt
President & CEO

I
I I
David Arthur Ian Cockwell
Ric Clarl<
President & CEO Chairman & CEO Steven Douglas
President & CEO
Canadian Residential EVP&CFO
US Operations
Operations Operations

I
I I I
Lawrence Katherine Vyse
Dennis Friedrich Mark Brown
Graham SVP SVP Investor
EVP& COO SVP Finance
Development Relations

I I
Dan Kindbergh Ralph Blasi
Mike Bosso
VP Property Director of
CM, WFC
Operations Security

Exhibit 5 Commercial Property Operations Organizational Chart

It was generally agreed that this culture of hard
work, camaraderie, respect and trust was consistent
across all Brookfield's North American offices.
SEPTEMBER 11TH-WORLD
TRADE CENTER ATIACKS
On September II, 200 1, the world watched in
horror as the twin towers of New York City's
World Trade Center (WTC) were destroyed by
what appeared to be acts of terrorism.
At 8:48 A.M. on that fateful Tuesday, a hijacked
passenger jet (American Airlines Flight II out of
Boston) crashed into the North Tower of the
World Trade Center, causing a massive fire
through several stories of the building. Eighteen
minutes later, at 9:03 A.M., a second hijacked jet
(United Airlines Flight J 7S out of Boston) crashed
into the South Tower of the WTC and exploded,
dispelling any thougbts that New Yorkers may
have had about the crashes being accidental.
By 9: 17 A.M., New York City airports were
shut down by the Federal Aviation Association
(FAA), and the Port Authority closed all bridges
and tunnels in the New York area.
For tbe first time in U.S. history, at 9:40 that
morning, the FAA halted all American flight
operations across the country, and air traffic was
diverted to the closest Canadian airports.
At 9:43 A.M ., a third hijacked jet (American
Airlines Flight 77) crashed into the Pentagon,
which was then evacuated along with the White
House. At 9:59 A.M . the South Tower of the
World Trade Center collapsed. At 10:00 A.M. ,
a fourth hijacked jet (United Airlines Flight 93)
crashed just south of Pittsburgh in Somerset
County, Pennsylvania. And at 10:28 A.M., the
North Tower of the WTC fell.
In New York, Mayor Giuliani urged all New
Yorkers to stay home if they bad not yet come
into the city. U.S. President George W. Bush
reported that all security measures possible were
being taken and asked for prayers from the
public. Senior FBI sources reported that they
assumed the four hijacked planes were part of a
terrorist attack and that they suspected that Saudi
militant Osama bin Laden was involved, based
on "new and specific" information.
Media information corning out of Lower
Manhattan was unreliable as the area had been
declared a no-fly zone and the press could not
access the WTC area, which had been cordoned
off for several blocks. This led to much specula-
tion as to the extent of the damage. Still, reports
of death and critical injury made it to the fore-
front and, by mid-afternoon, 2,100 total injuries
in New York were reported, with many more
expected as rescue efforts progressed.
ADJACENT BUILDINGS
With the general state of chaos and confusion in
Lower Manhattan, it was impossible to say with
any certainty what the extent of the damage was
to the buildings surrounding the World Trade
Center. Building 7 of the WTC was reported to be
on fire due to its proximity to the WTC attacks.
With phone lines down and access to the imme-
diate area blocked off, accurate information was
unavailable, but it was assumed that buildings
in the surrounding area had suffered severely.
Speculation also arose regarding damage done
to the World Trade Center slurry (or "bathtub")
wall-the structure that protected the WTC from
water leakage from the nearby Hudson River.
Four of Brookfield's properties, comprising
approximately 30 percent of the company's total
portfolio, were immediately adjacent to the WTC
towers (see Exhibit 6) and had clearly sustained
damage, blll it was not known how much. in fact,
three of these properties stood between the WTC
and the Hudson River, and it was clear that other
properties in the area were on fire or were
severely damaged. The major tenants of these
properties included:
• One World Financial Center (Lehman Brothers,
Dow Jones, National Financial Services, and
RBC Dain Rauscher);
• Two and Four World Financial Center (Merrill
Lynch) ; and
• One Liberty Plaza (Goldman Sachs, Cleary
Gottlieb, NASD, Bank of Nova Scotia, Zurich,
and Royal Bank of Canada).
Lastly, it was reported in the media that One
Liberty Plaza (a 2.2 million square foot property
that was 100 percent owned by Brookfield) was
on fire and in the process of collapsing.
BROOKFIELD REsPONDS
About that morning in New York, Clark said:
I came into the office early that moming, around
7:00 A.M. I was working quietly in my office when
I heard an explosion and felt the building shake.
I ran to the other side of the floor [facing the World
Trade Center] and saw a hole in about six floors of
the building. It was a giant fireball.
After calling home, I called Bruce and told him
what had happened . He wanted to come to
 ""alIen st
Exhibit 6 Lower Manhattan Properties
New York, but I told him not to come. I said
"Bruce, don't do it. Don't come." It just wasn't
safe. After the flfst plane hit, we evacuated all our
employees and tenants-it was better to send them
home than risk any potential harm.
Fortunately, Brookfield 's corporate director
of security, Ralph Blasi, had upgraded security
procedures three years earlier when he assumed
his position. He had hired a firm to develop
emergency and disaster plans and manuals for all
tenants, beginning with the New York properties,
and aU tenant evacuation plans had been revised.
Prior to these changes, aU 30,000 tenants had
planned to evacuate into the Winter Garden area
(a glassed-in atrium between the World Financial
Center buildings) which had a capacity of approx-
imately 2,500 people. Plans were changed to
""arren st
WaliSt
ensure the safe and timely passage of aU tenants
in the event that an evacuation would be neces-
sary (see Exhibit 7).
Flatt remembered his last conversation with
Clark around 10:30 that morning, just before cellu-
lar phone connections went down. Clark told him:
Bruce-Ralph, Dan. and Mike are staying at the
site. They·re helping other buildings in the area
evacuate. There are already cops on every street
comer and they're trying to get everyone out of the
area. I needed a security escort just to walk to the
WFC buildings. I'm heading out of here now-I'll
call you when [ reach the Madison Avenue offices.
Flatt had seen the second WTC tower collapse
on television shortly thereafter and had not had
any contact with Clark since.
New York Times, July 10, 2002

COMMERCIAL REAL ESTATE; Disaster Planner Has Lessons From 9/11 to Offer, and
Boston Listens
By MICHAEL BRICK

As Ralph A. Blasi remembers it, the man who was trying to enter the World Financial Center on Sept. 11 as
buildings burned nearby claimed to be a Verizon employee. The man would not take no for an answer, says
Mr. Blasi, the direC10r of security for Brookfield Financial Properties, manager of the World Financial Center.
"Punch this guy in the face, as hard as you can," Mr. Blasi says he remembers telling one of his secu-
rity guards, delivering an order that was effective in changing the man's mind before the punch itself
needed to be delivered.
That is Mr. Blasi's favorite part of the story. He includes it every time he talks about the evacuation. It
is funny, in a dark way, and it gets his audience's attention. But of far more importance to the property man-
agers here in Boston who have asked Mr. Blasi to repeat his story is what he did in the years before the
terrorist attacks in drawing up an evacuation plan .
' I was totally fascinated with the way he delivered it, the no-nonsense story," said Michael Quinn , a
senior vice president of Meredith & Grew who manages the 24-story building at 160 Federal Street in
Boston and who is president of the local Building Owners and Managers Association . "You could see him
choking up. It was like he was reliving the whole thing ."
Mr. Quinn heard the story with officials of the local fire, police and emergency management depart-
ments, and they have asked all the managers of this city's skyscrapers to come hear Mr. Blasi tell ~ again
in July. The point of Mr. Blasi's story is that landlords must join together to make disaster and security
plans. Such coordination is a hard sell , because these landlords are direct competitors who closely guard
every aspect of their operations and services from one another, using the information to attract and retain
the same tenants.
But now, in these times of rattled nerves, Mr. Quinn said, the landlords are changing their minds.
'It's not really going to cost any money to coordinate our evacuation plans with the city, but I think it's
an effective marketing tool , something you can take back to your tenants," Mr. Quinn said. "The idea right
now is to renew your tenants."
Mr. Blasi's story is particularly harrowing when he tells it in his own office at the World Financial Center
in New York, where he sits before a picture window overlooking ground zero and, at its edge, the damaged
shell of the Winter Garden. He did that for a visitor late last spring, before all the property managers in
Boston became interested. The story begins with his background.
He was a 22-year veteran of the New York Police Department, including stints on patrol in Queens and
Brooklyn and a job as a homicide deteC1ive. He retired in 1995, did a little bartending and private investi-
gation and eventually took the job with Brookfield. In 1997, he started asking World Financial Center ten-
ants, including Merrill Lynch, Lehman Brothers, Dow Jones and Fidelity Investments, about their
evacuation plans. He checked with the Mercantile Exchange, too. .
All told, by his count, about 30,000 people planned to gather in the Winter Garden, a 10-stQry atrium
with glass ceiling panels that served as a public entryway to the World Financial Center and connection
to the World Trade Center through the North Bridge. It was built to hold 2,500 people-a fact that greatly
affected his disaster planning.
 When the first airplane hit the World Trade Center on Sept. II, Mr. Blasi's staff cordoned off access to
the North Bridge with ropes and posted a guard there, sending workers from the World Financial Center
out into the streets. And turning away the man who claimed to be from Verizon.
That left room for people from the twin towers to evacuate across the North Bridge, which was even-
tually destroyed, and through the Winter Garden. Debris and bodies fell through the ceiling into the atrium,
but many workers who might have been underneath were already trudging up the West Side Highway.
"The·_biggest thing now is showing there's a clear need to know what your neighbors are doing,"
Mr. Blasi said. "Everybody has their own plan, but nobody's talking."
He has not taken this story on the road as a public speaker espousing some new management trend.
In fact, Mr. Blasi has traveled to tell his story only in Boston and Minneapolis, the two cities outside
New York where Brookfield owns substantial amounts of office space in crowded downtown towers.
For Brookfield, the business purpose is not to promote Mr. Blasi but to enhance security for the
company's tenants, said Richard B. Clark, the chief executive of the Brookfield Properties Corporation ,
which owns 95 percent of the company that employs Mr. Blasi.
"Security is only as good as the weakest link in the area; Mr. Clark said.
Here in Boston, the story has resonated.
"If you had all of these tenants evacuate out into this; Lt. James Hasson of the Boston Police
Department said as he drove a cruiser down Congress Street, "it would clog the street up, and this is a
major artery. This is the extent of the high rises in Boston, but it's a lot of workers, if you can imagine them
pouring out."
Property managers have extensively discussed security since Sept. II, obviously, but only now are
they beginning to coordinate their efforts. Mr. Quinn said he was just now beginning to ask his competitors
about their plans, but he fears that "most buildings are likely to go to Post Office Square; a 1.54-acre park
in the Financial District.
Until these recent discussions, Mr. Quinn said, managers had focused on their own individual buildings,
making decisions about what to spend on guards and cameras and electronic identification cards.
But now, as rents decline, they are pressed to find less expensive tactics without compromising safety.
Rents in the best high-rises downtown here have fallen to around $45 a square foot, from $70 in 2000 and
$59 a year ago. Various brokers and building managers here estimate that security costs have risen 10 to
20 percent since September, adding 50 cents to $1 a square foot to average annual asking rents, exclud-
ing any effects of the cost of terrorism insurance.
"You don't want to be too secure; said James E. Fox, an asset manager for CB Richard Ellis who han-
dles 1 Beacon Street, a one-million-square-foot office tower downtown with 50 tenants who employ a total
of 3,500 people. "You want to show your tenants that you're being cost-effective, but also safe."
That, in part, is why managers like Mr. Fox plan to go hear Mr. Blasi talk, as soon as Mr. Quinn can
bring him back to Boston .
As property managers set budgets for 2003, said Stephen P. Lynch, executive managing director of the
Boston office of the real estate services firm Cushman & Wakefield, they are looking for ways to market
the notion of enhanced safety without spending a lot on added security. Coordinating their plans and com-
municating their intentions may be unusual, he said, but it is inexpensive.
"This is one topic area where landlords are in open dialogue; Mr. Lynch said.
BROOKFIELD'S RELATIONSHIP
WITH LOCAL OFFICIALS
Many official government agencies had arrived at
the scene of the attacks to assist with rescue
efforts and to maintain order. Flatt knew the main
agencies that Brookfield would have to work with:
• At the federal level: FEMA-Federal Emergency
Management Agency;
• At the state level: The National Guard: and
• At the local level: The New York City Depanment
of Design & Construction (DOC), The New York
City Office of Emergency Management (OEM),
the Office of the Mayor of New York, and the New
York City police and fire departments.
Brookfield had always maintained good rela-
tions with government authorities, which Flatt
felt would ease their interactions over the coming
days and weeks. He also knew that having John
Zuccotti, former deputy mayor of New York, as
Brookfield's co-cbainnan would be an advan-
tage. Zuccotti was always well prepared to act as
the statesman in government dealings.
CONCLUSION
It was 4 P.M. on September 11 th, and Flatt sat at
his desk, overwhelmed by the day's events and
trying to decide what to do next. Brookfield had
issued a press release (see Exhibit 8), but how
would he make sure aU employees and tenants
were safe? How would they assess the damage
and get beyond government barriers to start
repairs, if that was even feasible? How would he
deal with the grief and suffering being experi-
enced by employees and tenants? Would offering
reassurances of a plan to return to business as
usual be insensitive with the degree of personal
trauma being experienced? How could he reas-
sure Brookfield's investors and the media of this
commitment to restoring Brookfield's position
of market strength? What was the best way to
deploy his staff and structure communications to
most effectively accomplish all this?
It was a critical time, filled with shock, horror,
pain, suffering and potentially severe business
losses. In the midst of chaos and uncertainty,
Brookfield needed an action plan, quickly.

BROOKFIELD RESPONDS TO NEW YORK CITY TRAGEDY

New York, New York, September 11 , 2001-(4:00 PM ETN) (BPO: NYSElTSE)

Brookfield Properties Corporation, in response to the tragic events in the U.S., reported that its emergency plans
were implemented, including the evacuation of tenants and employees from One liberty Plaza and the World
Financial Center, adjacent to the World Trade Center in downtown New York.
Bruce Flatt, President and CEO of Brookfield said: "We feel great empathy for the individuals and families
involved in this tragedy and our hearts go out to them."
Brookfield has no ownership interest in the World Trade Center. Brookfield owns 100% of One Liberty Plaza,
and 100% of Towers One and Two and 50% of Tower Four of the World Financial Center. From all accounts to
date, Brookfield's properties sustained no structural damage. Glass replacement and clean-up programs will
commence at the earliest opportunity.
Brookfield is co-operating with government and security authorities.
Mr. Flatt concluded "Our prayers go out to all of the victims of this great tragedy and their families."
 Brookfield Properties Corporation, with over US$8 billion in assets, owns, develops and manages premier North
American office properties. Brookfield also operates real estate service businesses and develops residential
master-planned communities. The Brookfield portfolio spans 60 commercial properties and development sites
totaling 46 million square feet. Brookfield is inter-listed on the New York and Toronto Stock Exchanges under the
symbol BPO. For more information, visit the Brookfield Properties Web site at www.brookfieldproperties.com.

Contact In/ormation
Katherine C. Vyse
Senior Vice President, Investor Relations and Communications
Brookfield Properties Corporation
Tel: (416) 369-8246
Fax: (416) 865 - 1288
Email: kvyse@brookfieldproperties.com

ELITE INC. (A)

Prepared by Jessica Frisch under the supervision

of Professors Ann Frost and Lyn Purdy
Copyright © 2003, Ivey Management Services Version: (A) 2003-10-06

It was April I, 2000, and Fran Benson, chief
executive officer (CEO) of Elite Inc., had just
entered her office for the day. As usual, Benson
went directly to her computer to check her e-mail.
To her dismay, she had received another late-
night message from Greg Jakes, the company's
chief financial officer (CFO). Recently, Jakes had
been spending 18-hour days at the office trying
to get his work done. Jakes spent inordinate
amounts of time checking over his daily tasks and
projects and, even with the long hours at work, he
could not meet his deadlines. With increasing
pressure from the board of directors, Benson
knew something had to be done about Jakes.
COMPANY BACKGROUND
Elite Incorporated, a highly successful public
relations fum, was founded in Toronto, Ontario,
in 1960. The company's founders, Carl and Frank
MacNeil, studied business at the University of
Toronto, and the brothers had always bad a keen
business sense. Upon Frank's graduation in
1958, he took a job as a financial analyst with a
large Canadian bank in order to gain business
experience and learn more about the Canadian
marketplace. When Carl graduated two years
later, the brothers started up their own public
relations finn using capital from their fami Iy and
a substantial loan . Frank assumed the role of
president and CEO while Carl assumed the role
of vice-president, operations.
Elite became an incorporated business in 1972.
For the next two decades, the company experi-
enced great success with growing profits and
healthy financial stability. The early 1990s, how-
ever, were troublesome for Elite. In 1991, Frank
and Carl decided to purchase a new head office
building in downtown Toronto. The combination