text: **Business Strategy**
  
  **Maximize NOI from Existing Portfolio**
  
  Management is focused on increasing the value of its real estate portfolio by maximizing revenue and operating efficiencies. To achieve NOI 
  growth, Killam must address three critical factors; occupancy, rental rates, and operating costs. The Company focuses on customer service, 
  investing in its properties, leasing and marketing initiatives, and training its employees to maximize these outcomes. 
  
  Management is able to directly control approximately 40% of operating expenses, including labour costs, repairs and maintenance and property 
  general and administrative expenses. The remaining operating costs, including utilities and property taxes, are less controllable. Killam’s 
  apartments are currently heated with a combination of natural gas, electricity and oil. Volatile oil and natural gas prices have an impact on 
  Killam’s operating costs. To mitigate this volatility, the Company is active in energy conservation initiatives and regularly monitors its energy 
  usage. 
  
  **Growth through Acquisitions**
  
  Killam is expanding its portfolio by acquiring newer, centrally located buildings and is focused on Ontario. During 2013 Killam completed $121.1 
  million in acquisitions, including properties in Toronto, Ottawa, Moncton and Prince Edward Island. 
  
  **Growth through Development**
  
  Killam enhances its portfolio growth opportunities by developing properties. Killam started apartment developments in 2010 and has completed 
  five properties to‑date, including four in 2013. Building new properties directly allows Killam to control the quality and features of the buildings, 
  maximizes the use of excess land and eliminates the seller’s profit, generating higher returns than through acquisitions. Management expects to 
  limit development projects to approximately 5% of the balance sheet on an annual basis. 