Management’s Discussion and Analysis
Dollar amounts are in thousands of Canadian dollars (except as noted)
Corporate Income
For the years ended December 31,
2013 2012 % change
Total $746 $962 (22.5)%
Corporate income includes property management fees, interest on bank accounts and transaction fees related to the joint venture partnership.  
The decrease year‑over‑year relates to transaction fees earned on the acquisitions under the joint venture partnership in 2012, partially offset by 
increased property management fees earned in 2013 as a result of higher revenues generated from the joint venture properties. 
Fair Value Gains
For the years ended December 31,
2013 2012 % change
apartments $1,272 $31,593 (96.0)%
mHcs 11,798 6,133 92.4%
$13,070 $37,726 (65.4)%
The effective weighted average cap‑rate used to value the apartment properties decreased 14 bps to 5.88% from December 31, 2012, resulting 
in an increased valuation for Killam’s investment properties early in 2013. Apartment cap‑rates stabilized in most regions during the second half 
of the year. Slight increases in cap‑rates in the Saint John market were realized in late 2013, reflecting the city’s softening economy.
The effective weighted average cap‑rate used to value the MHCs decreased 18 bps to 6.86% from December 31, 2012, resulting in increased 
valuations for 2013. See further discussion on cap‑rates in the “Investment Properties” section of the MD&A.
Other Expenses
Financing Costs
For the years ended December 31,
2013 2012 % change
mortgage and loan interest $30,090 $28,590 5.2%
Amortization on fair value adjustments on assumed debt (459) (229) 100.4%
Convertible debenture interest 6,687 6,632 0.8%
subordinated debenture interest 10 703 (98.6)%
capitalized interest (1,097) (1,063) 3.2%
$35,231 $34,633 1.7%
Financing costs were up $0.6 million, or 1.7%, in 2013 compared to 2012 due primarily to increased interest costs on debt placed or assumed 
on new acquisitions and developments. This increase was partially offset by refinancings at lower interest rates, payout of the subordinated 
debentures on January 4, 2013, and the sale of the mHcs in 2012 and 2013. 
Mortgage and loan interest expense, as a percentage of NOI, has decreased year‑over‑year as the Company refinances and acquires new debt at 
lower interest rates. in 2013, Killam placed $76 million of new debt on acquisitions and completed developments, including 10‑year and 5‑year 
term mortgages at an average interest rate of 3.44%. During 2013 the average interest rate on refinanced debt related to the Company’s existing 
properties decreased from 4.58% to 3.03% for apartments and 6.24% to 4.34% for MHCs.
Killam manages interest rate risk by entering into fixed‑rate mortgages and staggering the maturity dates. An annualized 100 bps change in the 
interest rate on Killam’s mortgage and vendor debt at December 31, 2013, would affect financing costs by approximately $7.1 million per year. 
However, only $139.3 million of Killam’s mortgage and vendor debt matures in the next twelve months and that same interest rate change would 
impact Killam by only $1.4 million per year. The Company’s credit facility and operating facility are discussed on pages 35‑36 of the MD&A.
Capitalized interest was flat year‑over‑year with $1.1 million capitalized on the development projects in progress during both 2013 and 2012. 
Interest costs associated with development projects are capitalized to their respective development property until substantial completion is 
achieved.
42 Killam ProPerties inc | 2013