Management’s Discussion and Analysis
Dollar amounts are in thousands of Canadian dollars (except as noted)
2013 Dispositions ‑ Investment Properties
On November 30, 2013, Killam sold a portfolio of ten MHCs in New Brunswick. Killam had invested $44.2 million to acquire and enhance 
this portfolio over the last ten years. The sale price of $69.0 million resulted in net cash proceeds of $42.6 million. The sale allowed Killam to 
crystallize the increased value of its New Brunswick MHC portfolio at current attractive cap‑rates and use the funds to continue to geographically 
diversify and accretively grow the apartment portfolio. In addition, the transaction will further enhance FFO accretion as apartments acquired 
are expected to qualify for CMHC insured debt, resulting in mortgage rates 120 ‑ 180 bps lower than conventional mortgages on MHC properties. 
The properties that were sold of are as follows:
Property Location Disposal Date       Sites Acres
mHcs
Burton estates Burton, nB 29‑Nov‑13 91 32
crown & currie estates Fredericton, nB 29‑Nov‑13 176 140
Kent & Bayview Bathurst & Beresford, nB 29‑Nov‑13 148 123
milford estates saint John, nB 29‑Nov‑13 152 22
Park P’ tiso estates e dmundston, nB 29‑Nov‑13 79 18
Pine t ree Village moncton, nB 29‑Nov‑13 828 260
Parkside estates Quispamis, NB 29‑Nov‑13 94 15
river e ast estates moncton, nB 29‑Nov‑13 109 72
t amarack estates Fredericton, nB 29‑Nov‑13 419 75
White Frost estates moncton, nB 29‑Nov‑13 212 51
Investment Properties Under Construction
For the years ended December 31,  
 2013  2012 
Balance, beginning of year $57,941 $11,574
Capital expenditures 28,356 47,284
interest capitalized 1,097 1,063
Land acquisitions 7,294 ‑
Transfers to investment properties (70,315) ‑
Fair value gains (losses) ‑  (1,980) 
Balance, end of year $24,373 $57,941
During 2013, Killam completed four development projects in the first half of the year; adding a total of 282 units to the Company’s apartment 
portfolio in key operating markets in Atlantic Canada. Total development costs were $69.6 million and the properties generated $0.9 million 
in NOI during the year.  Brighton House, located in Charlottetown, was completed in February 2013 and was fully leased by the end of the first 
quarter.  Bennett House, located in St. John’s, was completed in May 2013 and was fully leased within three months of opening. S2 located 
in Halifax and The Plaza located in Fredericton were both completed in May 2013 and are currently 62% and 61% leased.  Management has 
developed specific advertising and marketing strategies for these two buildings and expects the buildings to be substantially leased by mid‑2014. 
Management is anticipating a year‑one stabilized all‑cash yield of approximately 5% on these developments, and minimal capital requirements 
for the next 10 to 15 years.
Management believes that building and buying new apartments has the opportunity to generate more stable cash flows and improved returns 
on investments over time compared to buying older buildings. Management acknowledges that there was a dilutive impact on FFO per share 
growth during the period of construction but believes the short‑term impact is more than offset by the 10‑15 years of nominal maintenance 
costs provided by a newly built project. Older buildings typically require a much higher capital spend per year, estimated at least $1,200 per 
unit per year, versus an estimated $300 per unit for new construction. Assuming similar NOI growth between an old and new building, the 
lower capital spend on the new build is expected to result in a higher return on the total investment in the property in the first 10 – 15 years of 
ownership. Management expects to provide disclosure regarding capital spend associated with its new development projects over the next few 
years to provide support for this theory and show the Company’s ability to grow the return on investments of the new developments over time.
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