 All dollar references are in U.S. dollars, unless noted otherwise. BROOKFIELD NEWS, Aug. 06, 2020 GLOBE NEWSWIRE -- Brookfield Property Partners L.P. NASDAQ: BPY; NASDAQ: BPYU; TSX: BPY.UN BPY today announced financial results for the quarter ended June 30, 2020.The second quarter of 2020 brought unprecedented challenges to the commercial real estate industry, in addition to the broader economy and society as a whole. I am extremely proud of the thousands of dedicated Brookfield real estate employees around the globe who all played an integral role in preparing our properties for safe re-opening, and its gratifying to see our tenants return to their buildings and resume operations, said Brian Kingston, Chief Executive Officer. Financial ResultsCompany FFO CFFO was 178 million for the quarter ended June 30, 2020, compared to 335 million in the prior-year period. CFFO was impacted significantly this quarter by the widespread closures of our Hospitality and Retail assets due to the global economic shutdown, and the prior-year period benefited from a transaction gain of 38 million. In the prior-year period, CFFO and realized gains benefited from higher realizations in our LP investment strategy.Net income for the quarter ended June 30, 2020 was a loss of 1,512 million 1.26 per LP unit versus a gain of 23 million 0.12 per LP unit for the same period in 2019. The decrease in net income over the prior year period is primarily attributable to an unrealized reduction in asset values across the portfolio. Three months ended Jun. 30, Six months ended Jun. 30, US Millions, except per unit amounts 2020 2019 2020 2019 Net income1 1,512 23 1,885 736 Company FFO and realized gains2 178 362 501 729 Company FFO2 178 335 487 642 Net income per LP unit34 1.26 0.12 1.74 0.44 Company FFO and realized gains per unit45 0.18 0.38 0.51 0.76 1 Consolidated basis includes amounts attributable to non-controlling interests. 2 See Basis of Presentation and Reconciliation of Non-IFRS Measures in this press release for the definition and components. 3 Represents basic net income attributable to holders of LP units. IFRS requires the inclusion of preferred shares that are mandatorily convertible into LP units at a price of 25.70 without an add-back to earnings of the associated carry on the preferred shares. 4 Net income attributable to holders of LP units and Company FFO and realized gains per unit are reduced by preferred dividends of 11 million and 20 million for the three and six months ended June 30, 2020, respectively, in determining per unit amounts. 5 Company FFO and realized gains per unit are calculated based on 935.6 million 2019 952.1 million and 939.5 million 2019 961.4 million units outstanding for the three and six months ended June 30, 2020, respectively. Operating Highlights Our Core Office business generated CFFO of 126 million for the quarter ended June 30, 2020 compared to 187 million in the same period in 2019. The decrease in CFFO is primarily attributable to a transaction gain of 38 million recognized in the prior-year period, and a decrease this quarter in contributions from our parking and retail operations. Rent collections in our office portfolio in the second quarter were largely uninterrupted and consistent with historical periods.Despite a challenging operating environment resulting from the global economic shutdown, Core Office leasing activity in the second quarter totaled 0.7 million square feet spread across all of our major markets, executed at rents 16 higher on average than expiring leases in the period. Occupancy in the portfolio decreased 20 basis points to 92.3, with a remaining weighted average lease term of 8.6 years. Our Core Retail operations generated CFFO of 140 million for the quarter ended June 30, 2020 compared to 170 million in the comparable period in 2019. The current quarter results were impacted significantly by widespread mandated closures in our U.S. retail portfolio related to the global economic shutdown, which caused a decline in mall revenues, fee income, and an increase in credit loss reserves.Our Core Retail business leased approximately 7.4 million square feet over the past 12 months with suite-to-suite rent spreads of 7. Our same-store properties were 95 leased for the quarter ended June 30, 2020, consistent with the prior year. On a year-over-year basis, in-place rents were up 1.11. Rent collections in this portfolio in the second quarter were approximately 34, with July collections trending significantly stronger.Our LP Investments generated CFFO and realized losses of 8 million for the quarter ended June 30, 2020, compared to earnings of 106 million in the comparable period in 2019. Results in the current quarter were negatively impacted by a year-over-year decrease in earnings from our Hospitality investments of 78 million 0.08 per unit due to property closures, and a decline in transaction gains. Three months ended Jun. 30, Six months ended Jun. 30, US Millions2020 2019 2020 2019 Company FFO and realized gains: Core Office 126 187 261 327 Core Retail140 170 335 354 LP Investments8 106 68 252 Corporate80 101 163 204 Company FFO and realized gains1178 362 501 729 1 See Basis of Presentation and Reconciliation of Non-IFRS Measures below in this press release for the definitions and components. Dispositions In the second quarter, we completed 63 million of gross asset dispositions at our share, at prices that were 3 higher than our IFRS carrying values. These sales generated approximately 21 million in net proceeds to BPY.New Investments Restructured joint venture at Water Tower Place in Chicago to increase ownership from 43 to 94 through assumption of partners proportionate debt liability 153 million. Subsequent to quarter-end, committed 100 million 112 million to the Brookfield European Real Estate Partnership, a new Brookfield Asset Management BAM-sponsored open-ended private real estate fund focused on acquiring a diversified collection of high-quality properties and portfolios in Western Europe. This fund closed on its maiden investment in the second quarter with the acquisition of 42 Paridis, a 66,000-square-foot office building in central Paris for 102 111 million 14 15 million at BPYs share.___ 1 In-place rents reflect retail tenants 10K square feet Balance Sheet UpdateTo increase liquidity and extend the maturity of our debt, during the second quarter we executed the following financing transactions: Refinanced 655 New York Ave. in Washington, DC for 494 million with a two-year five years fully extended mortgage at a floating interest rate of LIBOR 2.25, generating net proceeds of 106 million. Refinanced Silver Spring Metro Plaza in Maryland for 110 million with a five-year mortgage at a floating interest rate of LIBOR 2.25, generating net proceeds of 2 million. Financed first phase of Halley Rise a 352-unit high-rise multifamily building in Reston, VA with a three-year five years fully extended construction loan totaling 111 million at a floating interest rate of LIBOR 2.75. Financed 1100 Avenue of the Americas in New York for 171 million with a five-year construction loan at a floating interest rate of LIBOR 1.95. Extended mortgage maturities for an average of one year on five Core Retail assets totaling approximately 1.2 billion.Ended the quarter with 6.0 billion of group-wide liquidity, including 1.5 billion of cash on hand, 2.8 billion of corporate and subsidiary credit facilities and 1.7 billion of undrawn construction facilities.Substantial Issuer BidOn July 6, 2020, we launched a substantial issuer bid SIB to purchase up to 74,166,670 of BPYs limited partnership units from public unitholders for a price of 12.00 per unit, for a total value of approximately 890 million. The SIB is being funded by Brookfield Asset Management and certain of its institutional clients and is set to expire on August 28, 2020. Unit Repurchase ProgramUtilizing our in-place normal course issuer bid NCIB, we purchased 2,641,196 of BPY units in the second quarter of 2020 at an average price of 8.45 per unit. COVID-19 Relief As an organization, we are continuing to utilize our various real estate locations, human and financial resources to do our part in contributing to the COVID-19 relief efforts around the globe. To date, Brookfields global real estate business has donated over 4 million in either cash or supplies to various relief efforts. We have also expanded our employee matching gift program from a 1:1 to a 2:1 match for employees donations directed toward pandemic relief efforts. Our efforts to mitigate the pandemic are ongoing and we continue to identify opportunities to contribute.Distribution Declaration The Board of Directors has declared a quarterly distribution on the partnerships LP units of 0.3325 per unit payable on September 30, 2020 to unitholders of record at the close of business on August 31, 2020.The quarterly distributions on the LP units are declared in U.S. dollars. Registered unitholders residing in the United States shall receive quarterly cash distributions in U.S. dollars and registered unitholders not residing in the United States shall receive quarterly cash distributions in the Canadian dollar equivalent, based on the Bank of Canada exchange rate on the record date. 