Office Fund: Tishman Speyer

Tishman speyer
OFFiCe FUnD
annUaL repOrT 2011
TISHM A N SPEY ER AuSTR A lIA lIMITEd AS R ESPONSIblE ENTITY Of TISHM AN SPEY ER OffIcE fu Nd A RSN 108 809 534 AfSl 246917
TSO
CoNTeNTS
LeTTer FrOm The CeO pOrTFOLiO sUmmary managers repOrT prOperTy sUmmaries bOarD OF DireCTOrs COrpOraTe gOvernanCe sTaTemenT FinanCiaL repOrT sUppLemenTary UniThOLDer inFOrmaTiOn COrpOraTe DireCTOry
1 4 5 13 30 33 43 94 IBC
Tishman speyer australia Limited (TsaL) (abn 43 106 909 871) is an indirect subsidiary of Tishman speyer properties, L.p. and is the responsible entity of the Tishman speyer Office Fund (TsO, the Fund). none of Tishman speyer properties, L.p., TsaL or any other affiliate of Tishman speyer properties, L.p. guarantees the performance of TsO, the repayment of capital from TsO or any particular rate of return. past performance is not a reliable indicator of future performance. an investment in TsO may result in a loss to an investor. The statements contained in this report that are not historical facts are forward-looking statements. These forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which the Fund operates, and managements beliefs and assumptions. Words such as expects, targeted, should, intends, plans, believes, estimates, forecasts, projects and variations of such words and similar expressions are intended to identify such forward-looking statements. This report is not an offer to sell, or solicitation of an offer to invest in, units of TsO. This report has been prepared without taking into account the personal objectives, financial situation or needs of particular individuals. before making any financial or investment decisions based on this report, we recommend that potential investors consider obtaining independent advice from a financial or other professional adviser and consider whether such an investment is appropriate, having regard to their objectives, financial situation and needs. TsaL does not receive fees in respect of the general financial product advice it may provide; however, it will receive fees for operating the Fund in accordance with the Funds Constitution. entities associated with TsaL may also receive fees for managing the assets of, and providing resources to, the Fund. impOrTanT nOTiCe TO UniThOLDers ThaT are in The UniTeD sTaTes Or U.s. persOns Unitholders should note that TsO has not been, and will not be, registered under the U.s. investment Company act of 1940, as amended (the investment Company act), in reliance on the exception from the definition of investment company provided by section 3(c)(7) thereof. accordingly, if you are a unitholder and are resident in the United states or a U.s. person (as defined in regulation s under the U.s. securities act of 1933, as amended) (a U.s. person), subject to certain exceptions, you must be a qualified purchaser as defined in section 2(a)(51) of the investment Company act (a Qualified purchaser), and if you are acting for the account or benefit of a U.s. person, that U.s. person must be a Qualified purchaser. Unitholders should also note that, to the maximum extent permitted under its constituent documents and by law, TsO reserves the right to refuse to record any sale or transfer of units to a person in the United states or a U.s. person that is not a Qualified purchaser, or that are otherwise sold or transferred in a manner that would not allow TsO to maintain the exception from registration under section 3(c)(7) of the investment Company act. in addition, you should be aware that TsO believes that it should be treated as a passive foreign investment company (or pFiC) for United states federal income tax purposes. as this may have adverse tax consequences for you, we recommend that you seek your own independent tax advice.
TSO
TISHMAN SPEYER OffIcE fuNd
ANNuAl REPORT
2011
lETTER fROM THE cEO
TSo | aNNUaL rePorT | 1
LeTTer From The Ceo
Financial year 2011 brought continued improvements to the financial condition of Tishman speyer Office Fund (TsO, the Fund). Over the course of the year, Tishman speyer australia Limited (TsaL) as responsible entity of the Fund, executed on the business plan of maintaining and enhancing the operating performance of TsOs property portfolio as well as seeking out opportunities to create additional unitholder value. These efforts have resulted in the following tangible results: net asset value per unit (adjusted to exclude the deferred tax liability) increased by 31.4% over the year from Us$1.02 to Us$1.34 and 20.7% over the past six months from Us$1.11 in December 2010; property carrying values up by 10.7% at 30 June 2011 (Us$1.52 billion) from the year prior; 860,700 square feet of leases signed over the year, resulting in portfolio occupancy of 88.2% and an average lease term to expiry of 6.1 years; beverly mercedes place back to 100% occupancy, up from 72% in December 2010; Closed the Us$135 million 300 park avenue loan in august 2010.
in the coming year, TsaL will continue to focus on leasing and asset management of the properties in the portfolio as it strives to enhance asset values and maximise returns as well as take on the task of refinancing the Us reiT loan prior to the may 2012 maturity date. We appreciate your continued support and look forward to seeking out opportunities to continue to strengthen the Funds balance sheet and to create value for unitholders in the year ahead. very truly yours,
David N Augarten
Chief Executive Officer Tishman Speyer Australia Limited
LeTTer From The Ceo
21 iNveSTmeNT oFFiCeS
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PorTFoLio SUmmary
FiNaNCiaL year 2011

Operational Highlights
Transaction activity returning to sales markets signed leases covering 0.9 million square feet during the year ended June 2011 portfolio is 88.2% leased with a weighted average lease term to expiry of 6.1 years Carrying value of properties up 10.7% to Us$1.52 billion over the prior fiscal year
ProPerTieS
Geographic Overview
520 Pike Tower

520 Pike Street Seattle, WA
330 E. Kilbourne Avenue Milwaukee, WI
Plaza East
Greenwich American Centre

1 American Lane Greenwich, CT
300 Park Avenue

New York, NY
One Bush Street

San Francisco, CA 156 West 56th Street New York, NY
CitySpire
Bayside Towers
4000 and 4100 East Third Avenue Foster City, CA
595 Market Street

San Francisco, CA
400 Castro Street

Mountain View, CA
Beverly Hills Portfolio

407 N Maple Drive Beverly Mercedes Place Maple Plaza, Beverly Hills, CA
227 West Monroe Street, 222 West Adams Street Chicago, IL
Franklin Center
Bala Cynwyd, PA
Bala Plaza
Ridgetop Circle, Loudoun County, VA
Lakeside at Loudoun Tech
TSO
ANNuAl REPORT
2011
MANAgERS REPORT
maNagerS rePorT
Tishman speyer Office Fund (TsO, the Fund) delivered Funds From Operations (FFO)
for the year to 30 June 2011 of 4.74 australian cents per unit, a decline from the prior years result of 10.10 australian cents per unit. The Fund reported an accounting profit before tax of a$105.5 million and a gain after tax of a$64.5 million for the year ended 30 June 2011.
1
independent valuations were obtained for all 16 assets in april 2011, resulting in an increase in gross property value to Us$1.52 billion (TsOs share of book property values as at 30 June 20112 ). This represents a 10.7% increase since 30 June 2010. at 30 June 2011, the net asset value (nav)3 per unit was a$1.26, compared to a$1.20 for 30 June 2010. The Funds U.s. dollar nav per unit increased from Us$1.02 to Us$1.34, a 31.4% increase for the year. The Funds gearing4 was 66.2%, down from 72.2% at 30 June 2010. no distribution was declared for the 12 months to 30 June 2011.
Operational Update
in august 2010, a Us$135 million loan was placed on 300 park avenue in new york. TsO holds a 45.9% 2 interest in 300 park avenue through the prime plus portfolio. TsOs share of the net proceeds of the financing is approximately Us$59.0 million (after fees and other costs). a portion of the proceeds (Us$8.1 million) was used to partially pay down the Us reiT facility. The remainder is held in a lender controlled interest reserve to pay the interest costs on the Us reiT loan. verisign, inc., the major tenant of the Lakeside complex in virginia with a 180,476 square foot tenancy, has exercised its option to terminate its lease effective november 2012. verisigns termination of its lease at the Lakeside complex is not expected to have a significant effect on TsO or the underlying Us reiT portfolio. The advance notice provided by verisign affords TsO an opportunity to consider its strategic alternatives for the complex.
Market Commentary and Leasing Highlights
Fiscal year 2011 was positive for the U.s. office market; as leasing activity picked up, positive net space absorption and rent increases were observed in many of TsOs core markets. property valuations also increased as rent rolls stabilised, outlooks improved and the debt and equity capital markets regained confidence. Well located, core Class a office product was in very high demand during the year from property investors. however, recently issued economic statistics regarding U.s. gDp growth, along with stubbornly disappointing unemployment numbers, have increased uncertainty surrounding the outlook for the economy. real gDp grew at a 1.3% annual rate between april and June 2011 and by 0.4% between January and march 2011. Unemployment is currently 9.1%, down only slightly from the rate of 9.5% one year ago. stimulative efforts by the government appear to be winding down, with the second round of the Federal reserves quantitative easing ending in June and the recently completed debt ceiling deal tightening the U.s. governments spending going forward.
1 2 3 4
FFO is calculated by adjusting a-gaap to exclude fair value movements on investment properties, gains or losses on property transactions, the promote, deferred tax expense, leasing costs and changes in the value of derivative contracts, and foreign exchange gains and losses. based on TsOs ownership percentage rather than the blended rate resulting from the promote. nav is calculated after adding back the deferred tax liability and the fair value of derivatives. gearing is calculated as (interest bearing liabilities - cash)/(total assets - cash).
maNagerS rePorT
Over the 12 months to 30 June 2011, TsO signed 139 leases covering 860,700 square feet. The portfolio recorded 5,200 square feet of positive absorption, resulting in the portfolio being 88.2% leased at fiscal year-end. bayside Towers in silicon valley, maple plaza in beverly hills and Cityspire in midtown manhattan experienced increased vacancy over the year. applera, baysides largest tenant, covering 84,500 square feet (32% of the complex), vacated when its lease matured in July 2010; as a result, the occupancy level of the building dropped temporarily to 63%. Terarecon, a leading technology solutions provider of 3D imaging systems for medical and industrial applications, signed a new 30,100 square foot lease, partially backfilling the former applera space. in addition, Legacy partners renewed its lease for 48,400 square feet and arena solutions also renewed its 13,600 square foot lease and expanded by 2,600 square feet. bayside Towers was 73% leased as of 30 June 2011, with approximately two floors of space available. beverly mercedes place in beverly hills has been fully leased since TsO acquired the property in may 2007. Over the course of this fiscal year, marvel and eWT vacated the building, resulting in a 72.3% occupancy level at 31 December 2010. beverly mercedes place is now back to 100% leased after renewing and expanding starz media for 33,900 square feet and attracting relativity media to the property, signing a new 35,600 square foot lease. maple plaza in beverly hills was negatively impacted by the decision of Fox interactive media to divest Fox mobile entertainment and vacate their 20,000 square feet at the property. The space is considered to be quite marketable, and the leasing team is actively marketing and touring the space to other potential prospects. Cityspires occupancy was impacted by the vacancy of two full floors at the property during this period. midtown manhattan continues to be one of the best rental markets in the country, and we expect that the propertys occupancy level will return to historical norms. in addition, occupancy gains this year were achieved at 595 market street in san Francisco, which saw a 2.6% increase, as well as at Franklin Center in Chicago, where 227 West monroe was up by 3.0% and 222 West adams occupancy increased by 3.3%. Further gains were seen at plaza east in milwaukee, where occupancy was up by 3.9% and at 520 pike in seattle, where occupancy increased by 3.7%.
New york market
TsO owns an interest in two properties in the new york metropolitan area: 300 park avenue and Cityspire, both in midtown manhattan. During the quarter ended 30 June 2011, the midtown manhattan office market recorded an exceptional 5.55 million square feet of leasing activity, with availability dropping 0.6% from first quarter 2011. This strong leasing activity marked the highest quarterly total since the first quarter of 2004 and surpassed the five year historical average of 3.67 million square feet by 51%. The availability rate now stands at 11.7%, the lowest level midtown manhattan has seen since the third quarter of 2008. recovering from 680,000 square feet of negative absorption in the first quarter of 2011, 1.40 million square feet of positive absorption in the second quarter drove year-to-date absorption to positive 710,000 square feet. During the 12 months to 30 June 2011, one lease was signed at 300 park avenue Charles schwab renewed 5,900 square feet of retail space through to 2020. goldenTree asset management vacated 6,900 square feet on the 25th floor, leading to negative net absorption for the period. 300 park avenue was 89.9% leased at 30 June 2011, a 0.9% decrease from 30 June 2010. nine leases were signed at Cityspire over the year ended 30 June 2011, covering 34,300 square feet. Of this leasing activity, 13,400 square feet were new leases and 20,900 square feet were renewal leases. however, 68,500 square feet in expirations for the same period resulted in the building finishing the year at 87.4% leased, compared to 96.8% at 30 June 2010.
maNagerS rePorT
greenwich, Fairfield County market
TsO owns an interest in greenwich american Centre in Fairfield County, Connecticut. The Fairfield County market saw leasing activity of nearly 1.3 million square feet in the first half of 2011, marking a 25% decline from midyear 2010 output, but an increase from midyear 2009s activity. however, leasing activity remained strong in the first two quarters of the year, pushing net absorption to positive 82,000 square feet in the first half of 2011. The availability rate fell from 20.4% in the first quarter of 2011 to 19.9% in the second quarter of 2011, driven largely by a 3% contraction in inventory. The greenwich submarket experienced an impressive increase of approximately 17% in rental rates compared to midyear 2010. however, the overall availability rate in greenwich stood at 21.2% at 30 June 2011, a 1.4% increase from 30 June 2010. at greenwich american Centre, blue sky studios expanded by 43,000 square feet leased by andor Capital. andor will pay a termination fee to surrender the space. as a result, greenwich american Centre remains 100.0% leased at 30 June 2011.
Philadelphia market
TsO owns an interest in bala plaza, a three-building office complex, together with a saks Fifth avenue retail store, located in the bala Cynwyd submarket of suburban philadelphia. During the second quarter of 2011, activity in the submarkets of the suburban philadelphia area remained relatively unchanged. Total net absorption year-to-date was negative 71,500 square feet, and the total availability rate edged up to 23.3% at 30 June 2011. in the bala Cynwyd submarket, total year-to-date net absorption was negative 56,600 square feet and availability increased to 22.5% from 18.4% 12 months earlier. Tenants continue to give back space, and, until hiring resumes at a steadier pace, the majority of leasing activity is related to tenants moving between buildings in each submarket. however, tenants seeking large blocks of space are experiencing limited relocation options, increasing the bargaining power of landlords. During the 12 months ended 30 June 2011, 21 leases were signed at bala plaza covering 136,900 square feet, consisting of 49,600 square feet of new leases and 87,300 square feet of renewals. Of particular note are a renewal lease signed with nCs pearson for 42,600 square feet and a new lease signed with marcum, an accounting and advisory firm, for 25,000 square feet. The marcum lease is the largest new lease signed since 2006 at bala plaza and the largest new deal signed in the bala Cynwyd submarket since 2008. Coupled with lease expiries of 138,800 square feet, bala plaza was 87.5% leased at 30 June 2011 compared to 87.7% leased at 30 June 2010.
Northern virginia
TsO owns an interest in Lakeside at Loudoun Tech, situated in the Loudoun County submarket within northern virginia. vacancy in the northern virginia office market decreased year-over-year by 0.9% to 13.3% at 30 June 2011, while average asking rents increased by 3.2% year-over-year. year-to-date net absorption in northern virginia registered at negative 467,500 square feet for the quarter, while Loudon County saw positive net absorption of 83,900 square feet for the same period. in the Loudoun County submarket, vacancy decreased 0.5% year-over-year to 17.3%. as the majority of tenants in the northern virginia market are government agencies and contractors, real estate decision making has been stagnant in recent months due to uncertainty surrounding the 2012 federal budget. During the 12 months ended 30 June 2011, six leases were signed at Lakeside for 38,400 square feet, comprised of 18,200 square feet of new leases and 20,200 square feet of renewal leases. With 30,900 in lease expirations for the same period, Lakeside was 87.6% leased at 30 June 2011, a 2.5% increase from the same time last year.
maNagerS rePorT
Chicago market
in Downtown Chicago, TsO owns an interest in Franklin Center, a two-building complex comprised of 227 West monroe street and 222 West adams street, which share a block-long lobby. both of these assets are high quality Class a buildings located in the West Loop submarket, the premier office submarket in Chicago. in the second quarter of 2011, the direct vacancy rate in the Chicago market decreased by 0.7% year-over-year to 14.5%. second quarter net absorption was robust at positive 549,000 square feet, marking the fourth consecutive quarter of positive net absorption and the greatest positive net absorption the market has seen since the third quarter of 2008. in addition, rental rates increased for the fourth quarter in a row. With the signing of 10 leases, 227 West monroe street recorded 87,400 square feet of leasing activity during the year to 30 June 2011, comprised of 45,200 square feet of new and renewal leases and 42,200 square feet of expansions. Of particular note, William blair took an additional 35,900 square feet of expansion space. With 39,400 square feet of expirations or contractions, the asset had 48,000 square feet of positive absorption during the year to 30 June 2011. as a result, 227 West monroe was 82.3% leased on 30 June 2011 compared to 79.3% leased on 30 June 2010. During the 12 months to 30 June 2011, 33,400 square feet of leasing activity was recorded at 222 West adams street, which was comprised of three new leases, two renewal leases, and one expansion lease. Combined with just 3,400 square feet in expirations during the year, 222 West adams street was 86.1% leased at 30 June 2010, a 3.3% increase from 30 June 2010.
milwaukee market
TsO owns an interest in one Downtown milwaukee asset, plaza east. The availability rate for milwaukees Central business District is at 22.5% as of 30 June 2011, a 2.3% increase year-over-year. average asking gross rents have decreased by 2.1% year-over-year. in spite of some signs of softening in the market, leasing activity at plaza east was strong for the 12 months ended 30 June 2011. seventeen leases covering 86,800 square feet were signed at plaza east during the year ended 30 June 2011. Over the 12 month period, associated bank expanded to three additional suites for 31,000 square feet. This leasing activity, combined with 68,900 square feet of lease expiries, resulted in plaza east being 90.6% leased on 30 June 2011, a 3.9% increase from a year earlier.
Seattle market
TsO owns an interest in one seattle asset, 520 pike Tower, situated in the Downtown seattle submarket. in the second quarter of 2011, the vacancy rate in the puget sound office market declined to 18.8%, a 1.7% decline from 20.5% at 30 June 2010. With positive net absorption of more than 580,000 square feet, the puget sound market recorded its fifth consecutive quarter of positive absorption. although 545,000 square feet of new construction was delivered to the Downtown seattle market in the second quarter of 2011, strong absorption kept the vacancy rate unchanged from the first quarter of this year. One of the key drivers for the improving office market statistics is that seattle area employment figures have continued to outperform other cities throughout the United states. at 520 pike Tower, 15 leases covering 59,700 square feet were signed, consisting of 22,800 square feet of new leases, 21,800 square feet of renewal leases, and 15,100 square feet of expansion leases. The tenant accounting for the greatest amount of leasing activity in the 12 months ended 30 June 2011 was principal insurance, renewing 5,600 square feet and expanding by an additional 5,700 square feet. expirations and contractions for the period totalled 46,000 square feet for the same period. 520 pike Tower was 91.1% leased at 30 June 2011, a 3.7% increase from 30 June 2010.
maNagerS rePorT
San Francisco market
TsO owns an interest in two Class a office buildings in san Francisco: 595 market street and One bush street. The san Francisco office market saw blockbuster positive net absorption in the second quarter of 2011, topping out at over 677,000 square feet. While some vacant space did return to the market, transaction volume increased almost 40% to 2.1 million square feet, driven largely by space demands from the technology sector. year-over-year, total availability decreased by 4.2% from 20.4% at 30 June 2010 to 16.4% at 30 June 2011. in the Financial District submarket, total availability dropped by 2.2% to 16.5% at the end of the fiscal year. Class a asking rates increased 10.7% year-over-year, with a 6.1% increase over the previous quarter. strong leasing velocity continued at 595 market street with the execution of 20 leases for the 12 months ended 30 June 2011. 91,500 square feet of leases were signed, comprised of 14,300 square feet in new leases, 65,500 square feet in renewal leases, and 11,700 square feet in expansion leases. The most significant leases signed during this period were the Cmg Commercial mortgage and hartford insurance renewals, each for 14,700 square feet. Coupled with 80,600 square feet of expirations and contractions, 595 market street was 94.9% leased as of 30 June 2011, a 2.6% increase from 92.3% leased as of 30 June 2010. at One bush street, the renewal of 13,800 square feet and a new lease for 3,300 square feet (after the existing lease on the suite expired during the period) resulted in the building continuing to be 100.0% leased as of 30 June 2011.
San Francisco Peninsula market
TsO owns an interest in bayside Towers (Foster City) and 400 Castro street (mountain view), both located on the san Francisco peninsula. The san Francisco peninsula market continued to realise positive market fundamentals in the second quarter of 2011. The overall availability rate decreased 0.1% year-over-year to 15.4%, while net absorption registered just under positive 167,000 square feet in the second quarter of 2011. in Foster City, where bayside Towers is located, the availability rate edged up from 10.8% as of second quarter 2010 to 11.4% as of second quarter 2011. however, rental rates saw their third consecutive quarter of asking rate increases, up 6.3% quarter-over-quarter. in the 12 months ended 30 June 2011, bayside Towers experienced strong leasing activity. Five leases totalling 96,400 square feet were signed during the period, though 155,700 square feet of expirations also occurred. applera Corporation, baysides former largest tenant (84,500 square feet or 32.2% of nra), vacated in July 2010, but a new lease with Terarecon for 30,100 square feet re-absorbed a portion of this space. renewals were signed with Legacy partners (48,400 square feet) and arena solutions (13,600 square feet), and arena solutions expanded by an additional 2,600 square feet in may 2011. Due to the high tenant rollover during this period, bayside Towers ended the year at 73.0% leased, compared to 95.4% leased at 30 June 2010. 400 Castro street remains 100.0% leased with no rollover through to august 2017.
maNagerS rePorT
Beverly hills market
TsO owns an interest in maple plaza, 407 north maple Drive and beverly mercedes place, all of which are located in the West Los angeles (beverly hills) submarket of Los angeles, California. in spite of positive net absorption for the first time in over three years in the first quarter of 2011, the greater Los angeles market recorded negative net absorption of 465,000 square feet in the second quarter of 2011. The unemployment rate remains at 11.9%, 2.8% higher than the national average, which has caused the Los angeles economy to lag behind the rest of the nation in its recovery. year-over-year, the total overall vacancy rate stood at 18.0% at 30 June 2011, a 60 basis point increase from 17.4% at 30 June 2010. in the West Los angeles submarket, where TsOs assets are located, the availability rate has held constant year-over-year at 15.4%. average asking rents in the greater Los angeles area have decreased 4.1% year-over-year, but held steady from first quarter 2011. average asking rents continue to be the highest in the West Los angeles submarket. During the year ended 30 June 2011, 20 leases were signed at maple plaza covering 60,300 square feet, comprised of 9,900 square feet of new leases, 45,200 square feet of renewals, and 5,200 square feet of expansions. however, 81,000 square feet of lease expirations and contractions occurred in the same period, with one of the assets largest tenants, Fox mobile entertainment (mobizzo/Jamster) vacating 20,000 square feet in June 2011. as a result, maple plaza finished the year 72.0% leased, a 7.2% decrease from 79.2% leased at 30 June 2010. significant leasing successes were seen at beverly mercedes place during the period. in the first six months of the fiscal year, two significant tenants, marvel entertainment and eWT, vacated 35,600 square feet. relativity media, a media and entertainment company, signed a new lease for the full 35,600 square feet in may 2011. in addition, starz media renewed 11,700 square feet and expanded by 22,300 square feet, taking up all of the broder Webb space which expired in June 2011. beverly mercedes place remains 100.0% leased at 30 June 2011, as it was at 30 June 2010. 407 north maple Drive remains 100.0% leased to Fox interactive media through to may 2016.
maNagerS rePorT
Leasing Activity from 1 July 2010 to 30 June 2011
The table below summarises the net leasing activity for the 12 month period:
Leased Status Expiries/ 30 Jun 10 Contractions 90.8% 96.8% 100.0% 92.3% 100.0% 100.0% 79.3% 82.8% 86.7% 87.4% 87.7% 95.4% 85.2% 79.2% 100.0% 100.0% 88.3% (12,822) (68,470) (43,008) (80,600) (17,070) (39,429) (3,439) (68,928) (45,757) (138,815) (155,687) (30,855) (81,022) (69,572) (855,474) Total Leasing Activity 5,897 34,262 43,008 91,535 17,070 87,415 33,363 86,841 59,722 136,892 96,388 38,384 60,337 69,593 860,707 Leased Status 30 Jun 11 89.9% 87.4% 100.0% 94.9% 100.0% 100.0% 82.3% 86.1% 90.6% 91.1% 87.5% 73.0% 87.6% 72.0% 100.0% 100.0% 88.2%
Asset 300 park Cityspire gaC1 595 market One bush 400 Castro 227 West monroe 222 West adams2 plaza east 520 pike bala plaza bayside Lakeside maple plaza 407 north maple beverly mercedes Total
1 2
Percentage Ownership 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 99.9% 99.9% 99.9% 99.9%
New 13,388 43,008 14,288 3,301 45,093 21,244 16,093 22,787 49,641 31,721 18,188 9,918 35,606 324,276
Renewal Expansion 5,897 20,874 65,557 13,769 100 5,843 39,718 21,857 87,251 62,052 20,196 45,165 11,661 399,940 11,690 42,222 6,276 31,030 15,078 2,615 5,254 22,326 136,491
Net Change (6,925) (34,208) 10,935 47,986 29,924 17,913 13,965 (1,923) (59,299) 7,529 (20,685) 21 5,233
greenwich american Centre, CT. positive expiries/contraction pertains to minor building re-measurement adjustment.
TSO
2011
ANNuAl REPORT
PROPERTY SuMMARIES
ProPerTy SUmmarieS
300 PARK AVENUE
NEW YORK, NY
Property Location: Year Built/Renovated: Ownership %: Building Size: Leased %: Carrying Value:
new york, ny
1955/1998/2000 45.9% 773,314 square feet 89.9% Us$778.0 million
ProPerTy DeSCriPTioN
300 park avenue is a 26-storey, Class a commercial office building located on prestigious park avenue in the heart of midtown, the business centre of new york. acquired in 2004 for Us$387 million, now valued at Us$778 million, the property serves as the global headquarters for Colgate-palmolive.
note: property information shown is at 30 June 2011.
major TeNaNTS
SqUare FeeT
% oF ToTaL
LeaSe exPiry
Colgate-palmolive greenhill and Co. inc. goldenTree asset management Chilton investment Co
503,159 104,719 41,233 20,616
65.1 13.5 5.3 2.6
Jun 2023 Oct 2020 aug 2018 Jan 2021
ProPerTy SUmmarieS
CITYSPIRE
NEW YORK, NY
Property Location: Year Built: Ownership %: Building Size: Leased %: Carrying Value:
new york, ny 1987 45.9% 370,579 square feet 87.4% Us$166.6 million
Cityspire, a 72-storey office and residential building designed by the architectural firm of murphy/Jahn associates, is well located in the heart of midtown manhattan, four blocks from Central park and with easy access to major transportation hubs.
major TeNaNTS
SqUare FeeT
% oF ToTaL
LeaSe exPiry
Windels marx globeOp Japanese Tourism board bennett Footwear
58,977 32,084 27,440 27,366
15.9 8.7 7.4 7.4
sep 2017 sep 2017 Dec 2018 may 2013
ProPerTy SUmmarieS
GREENWICH AMERICAN CENTRE
GREENWICH, CT
greenwich, CT 1970/1987 45.9% 650,413 square feet 100% Us$189.4 million
greenwich american Centre is a Class a corporate office park situated on 155 acres located in greenwich, Connecticut, one of the most affluent communities in the U.s. The building was designed by gordon bunshaft of skidmore, Owings & merrill and was completed in 1970.
major TeNaNTS
SqUare FeeT
% oF ToTaL
LeaSe exPiry
blue sky studios goldman sachs Tudor investment group Citation shares Citation shares
152,715 124,349 101,525 36,440 33,891
23.5 19.1 15.6 5.6 5.2
may 2018 Dec 2015 Oct 2017 may 2015 nov 2012
16
ProPerTy SUmmarieS
BALA PLAZA
BALACYNWYD, PA
bala-Cynwyd, pa 1967, 1969, 1982 45.9% 1,127,577 square feet 87.5% Us$142.9 million
bala plaza is a three-building office complex together with a connected saks Fifth avenue retail store. One bala and Two bala are Class b buildings and Three bala, which has two wings, is a Class a building.
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philadelphia insurance Oracle Usa, inc. United national insurance nCs pearson*
*
140,641 88,565 72,986 42,609
13.1 8.2 6.8 4.0
Feb 2014 Jul 2015 Dec 2013 apr 2021
Tenant formerly known as promissor inc. and was acquired by nCs pearson in 2006. nCs pearson completed a renewal in april 2011.
ProPerTy SUmmarieS
FRANKLIN CENTER 227 WEST MONROE NAME
CHICAGO, IL PLACE
Chicago, iL 1989 45.9% 1,584,769 square feet 82.3% Us$433.9 million
227 West monroe and 222 West adams share a block-long lobby and are collectively known as the Franklin Center. 227 West monroe is widely regarded as one of the most desirable and architecturally significant office properties in Chicago. This 60-storey trophy building, designed by the world-renowned Chicago-based architectural firm skidmore, Owings & merrill, is well-located one block east of Wacker Drive in the West Loop.
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mcDermott, Will & emery Citicorp Credit suisse robert W. baird William blair and Company
272,359 229,206 159,596 116,233 71,000
17.2 14.5 10.1 7.3 4.5
apr 2017 Jun 2025 sep 2013 nov 2025 aug 2017
ProPerTy SUmmarieS
FRANKLIN CENTER 222 WEST ADAMS NAME
CHICAGO, IL PLACE
Chicago, iL 1992 45.9% 930,994 square feet 86.1% Us$227.5 million
222 West adams is a 35-storey Class a property, designed by the world-renowned Chicago-based architectural firm skidmore, Owings & merrill. Completed in 1992, it is recognised as one of the premier office buildings in Downtown Chicago, and was built to a higher than market standard. The lobby includes many distinct architectural features such as patterned marble floors and walls, stylised lighting fixtures, dark mahogany woods and ceiling murals.
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William blair & Company gaTx aT Kearney FTi Consulting, inc.
306,191* 124,633 88,297 91,238**
32.9 13.4 9.5 3.7
aug 2017 Oct 2023 aug 2017 Jun 2025
* 18,000 square feet expires July 2011. ** represents the total square footage leased by FTi in both 222 West adams and 227 West monroe.
ProPerTy SUmmarieS
PLAZA NAME EAST I AND II
MILWAUKEE, WI PLACE
milwaukee, Wi 1982, 1984 45.9% 475,827 square feet 90.6% Us$49.4 million
plaza east is well-located in the central business district of Downtown milwaukee within walking distance of Lake michigan and is close to regional transportation hubs, several high-end hotels, a performing arts centre and various other area attractions. The property consists of two 14-storey office towers spanning an entire city block, joined together by a barrel-vaulted four-storey glass atrium and a six-storey offsite parking facility, along with a large outdoor landscaped plaza.
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gsa (Fbi)* associated bank mortgage guaranty insurance Corporation robertson ryan & associates
87,784 59,532** 29,510** 17,432
18.4 12.5 6.2 3.7
nov 2012 Jun 2022 Jan 2013 sep 2015
* Tenant has a termination option beginning in December 2011. ** associated bank leases 89,042 square feet. The additional 29,510 square feet is currently leased by mgiC through to January 2013.
ProPerTy SUmmarieS
520 PIKE TOWER NAME
SEATTLE, WA PLACE
seattle, Wa 1983/2000 45.9% 384,922 square feet 91.1% Us$101.1 million
520 pike Tower is a 29-storey Class a property located in the centre of Downtown seattle, surrounded by destination retail venues, exclusive hotels and premier office buildings with high quality tenants. The property is within walking distance of the waterfront and within blocks of the famous pike street marketplace. in addition to its ideal location, the building offers exceptional water views on the upper floors.
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marchex national Union Fire insurance/aig grant Thornton Washington Federal savings
61,332 26,989 17,686 17,686
15.9 7.0 4.6 4.6
mar 2018 may 2012 apr 2016 Jun 2015
ProPerTy SUmmarieS
ONE BUSH STREET NAME
SAN FRANCISCO, CA PLACE
san Francisco, Ca 1959/1990 45.9% 329,711 square feet 100% Us$133.9 million
One bush is a 19-storey Class a office building, located in the heart of the Financial District of Downtown san Francisco. One bush was built in 1959 as the corporate headquarters of Crown zellerback and was later renovated in 1990. Designed by skidmore, Owings & merrill, One bushs simple, yet distinctive, design remains one of the finest examples of the international school of architecture.
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hellmuth Obata Kassabaum pacific growth equities Willis insurance services grubb & ellis
67,430 51,132 34,088 17,044
20.5 15.5 10.3 5.2
nov 2012 nov 2013 Jun 2013 Dec 2015
ProPerTy SUmmarieS
595 MARKET STREET NAME
SAN FRANCISCO, CA PLACE
san Francisco, Ca 1979 45.9% 429,355 square feet 94.9% Us$136.0 million
595 market is a 30-storey Class a office building prominently located in the centre of the Financial District in Downtown san Francisco. Completed in 1979, the building was designed by skidmore, Owings & merrill. The building features a striking precast exterior with a continuous window line of glass that provides abundant light and views of the san Francisco bay from the upper floors.
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visa U.s.a. CCCsF* selectQuote insurance services Calypso Technology**

*
43,842 41,965 33,652 29,223
10.2 9.8 7.8 6.8
aug 2019 apr 2013 mar 2021 Dec 2014
Consumer Credit Counselling services of san Francisco. 5,000 square feet expires may 2012.
** Calypso Tech leases 470 square feet on a month-to-month basis.
ProPerTy SUmmarieS
BAYSIDE TOWERS
FOSTER CITY, CA
Foster City, Ca 1999 45.9% 268,555 square feet 73.0% Us$67.2 million
bayside Towers is a high quality, modern Class a office property developed in 1999, consisting of two mirror-image six-storey buildings. The property boasts unencumbered views of the san Francisco bay and the 10 mile long san mateo bridge, with direct access to the shoreline via a footbridge. bayside Towers, situated in one of the most picturesque settings for an office environment, is distinguished by its modern mirror-image design and its curvilinear tinted glass faade.
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philips electronics Legacy partners Terarecon e2Open
65,873 48,411 30,073 24,606
24.5 18.0 11.2 9.2
aug 2012 Dec 2016 Dec 2015 Feb 2013
ProPerTy SUmmarieS
400 CASTRO STREET
SILICON VALLEY, CA
silicon valley, Ca 2002 45.9% 138,681 square feet 100% Us$103.6 million
400 Castro street is a state-of-the-art, Class a, six-storey office building completed in 2002. The building is well-located in the heart of Downtown mountain view, one of the peninsulas most prestigious office markets. The property is situated near the mountain view Center for the performing arts and City hall, and is in close proximity to numerous Downtown restaurants.
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Fenwick & West Cantankerous Fish Don Durante
128,781 5,521 4,379
92.9 4.0 3.1
aug 2017 Dec 2018 Dec 2018
ProPerTy SUmmarieS
LAKESIDE AT LOUDOUN TECH
WASHINGTON DC, METRO
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Washington DC, metro 1999, 2000, 2001 99.9% 305,509 square feet 87.6% Us$49.9 million
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Lakeside at Loudoun Tech consists of three four-storey Class a office properties, scenically positioned symmetrically around an ornamental lake. each building features a brick faade, brick vertical pilasters and accents, and the lobbies are clad with polished italian granite, mahogany wall panels and base and indirect cove lighting. Lakeside at Loudoun Tech is also located less than 10 minutes away from Washington Dulles international airport, and within a half mile of the intersection of route 7 and route 28, which are the countys primary east/west and north/south corridors respectively.
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verisign* alpha Construction & engineering Washington radiology associates, p.C. m/i homes of DC LLC
181,036** 15,632 11,961 10,724
59.3 5.1 3.9 3.5
nov 2012 Feb 2020 apr 2012 Jun 2012
* verisign has exercised its option to terminate at 30 november 2012. ** includes 7,092 square feet currently subleased from Wordplay, inc.
ProPerTy SUmmarieS
MAPLE NAME PLAZA
BEVERLY HILLS, CA PLACE
beverly hills, Ca 1987 99.9% 290,961 square feet 72.0% Us$149.3 million
maple plaza is a three-storey Class a office property located in beverly hills, California. This excellent location affords it access to nearby first-class hotels, restaurants and retailers located in the golden Triangle and along rodeo Drive. maple plaza boasts two dramatic three-storey atrium entrances and landscaped courtyards.
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morgan stanley netflix, inc. netflix, inc. netflix, inc. eWT, LLC Levine Leichtman Capital partners
46,325 19,421 4,076 3,729 15,270 15,019
15.9 6.7 1.4 1.3 5.2 5.2
apr 2017 aug 2015 Jan 2014 sep 2011 may 2012 sep 2014
ProPerTy SUmmarieS
407 NORTH MAPLE DRIVE NAME
beverly hills, Ca 2003 99.9% 163,811 square feet 100% Us$94.4 million
Designed by the renowned architectural firm gwathmey, siegel & associates, 407 north maple Drive is a four-storey trophy-quality Class a office building constructed in 2003. 407 north maple is situated around a U shaped central courtyard with extensive landscaping. The exterior walls are stainless steel and granite slabs, broken up by tinted windows set in metal frames. modern finishes such as polished steel, glass and granite adorn both of the double-storey entry lobbies.
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Fox interactive media*

* Lease is guaranteed by news Corporation.
163,811
100%
may 2016
ProPerTy SUmmarieS
BEVERLY MERCEDES PLACE NAME
beverly hills, Ca 1990 99.9% 132,288 square feet 100% Us$62.1 million
beverly mercedes place is a three-storey Class a office property located on the corner of beverly boulevard and north maple Drive, one of the largest and most lucrative trade areas nationwide. The propertys exterior walls are clad in polished granite in combination with solar gray window systems; clear tempered glass is provided at the storefront areas on the ground floor. The second and third floors feature terraces that offer expansive views of beverly hills and the hollywood hills.
major TeNaNTS
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miller-Dm, inc. (mercedes-benz) relativity media starz media, LLC
59,008 35,605 33,987
44.6 26.9 25.7
Dec 2024 aug 2018 Dec 2016
TSO
2011
ANNuAl REPORT
bOARd Of dIREcTORS
BoarD oF DireCTorS
graham j Kelly, Chairman and independent Non-executive Director
mr Kelly is a professional non-executive director and consultant with over 40 years experience in academic life, government service, the Diplomatic service, private legal practice, and business management. he has chaired several listed entities, currently including the Tishman speyer Office Fund and Centrebet international Limited. he is also a governor of the Centenary institute for Cancer medicine and Cell biology, as well as being a director of a number of unlisted companies. he was previously the chairman of, among other listed companies, Tab Limited, recruitment solutions Limited and Colonial First state private Capital Limited; a director of the state bank of nsW (later Colonial state bank) and a Trustee of the Commonwealth and public sector superannuation schemes. From 2005 to 2008, mr Kelly held appointment as the inspector of the independent Commission against Corruption (nsW). mr Kelly was previously a partner of Freehills, specialising in corporate and government law. he was managing partner of the sydney office from 1991-1995, and also national chairman of the firm from 1993-1995. he remains a consultant to that firm, though no longer engaged in active legal practice.
richard m haddock, independent Non-executive Director
mr haddock is a well seasoned professional with significant board experience. he has over 35 years of professional experience, most recently as deputy general manager for bnp paribas australia, from which he retired in 2001. his current board appointments include chairman of Commonwealth managed investments Ltd and CatholicCare. mr haddock is also currently serving as a director of retirement villages australia Ltd and retirement villages group r.e. Limited. he is honorary treasurer and national director of Caritas australia and chairman of the Catholic superannuation and retirement Fund. his prior board experience includes chairman of Cashcard australia, director of sme growth, bnp paribas investment management (australia), axa insurance, insurance exchange of australia group, auspace Colonial First state private Capital and macarthurCook Limited. mr haddock holds bachelor of arts and bachelor of Laws degrees from the University of sydney.
jerry i Speyer, Non-executive Director
mr speyer is chairman of the museum of modern art. he is vice chair of new york presbyterian hospital. he is the former chairman of the board of Directors, the Federal reserve bank of new york; chairman emeritus of Columbia University; chairman emeritus of the real estate board of new york; chair emeritus partnership for new york City; and past president of the board of Trustees of the Dalton school. mr speyers other board affiliations include yankee global enterprises, the economic Club of new york and the asia society. he is a member of the Council on Foreign relations and the business roundtable.
BoarD oF DireCTorS
rob j Speyer, Non-executive Director
mr speyer was named Co-Chief executive Officer of Tishman speyer in 2008 and continues to serve as president. since joining the firm in 1995, he has worked in senior positions in each of its major spheres of activity, including acquisitions, development, capital markets and leasing. mr speyer was appointed by mayor bloomberg as chair of the mayors Fund to advance new york City, the not-for-profit corporation for the City of new york. mr speyer is the founder and co-chair of the Committee to save new york, a coalition of business, labour and civic groups promoting fiscal reform for new york state. he is a founding member of the partnership for a new american economy, a national group of business and political leaders committed to immigration reform. he is a member of the board of visitors of Columbia College (emeritus), the board of Trustees of the new york City police Foundation, the board of Trustees of the Citizens budget Commission and the executive Committee of the board of governors of the real estate board of new york. he graduated magna cum laude from Columbia College in 1992, and was elected to the phi beta Kappa society.
David N augarten, Ceo and executive Director
mr augarten was appointed CeO and executive director of TsaL in February 2009. mr augarten joined Tishman speyer as the Director of Taxes in 1984, and today directs the companys global portfolio and asset management functions. While at Tishman speyer, he has also worked in the acquisitions and development areas prior to serving as Treasurer from 1993-1996 and Chief Financial Officer from 1996-2000. before joining Tishman speyer, mr augarten was with arthur andersen & Co., where he specialised in its real estate tax practice. he graduated from Ohio University with a bba in 1978 and received his J.D. from the boston University school of Law in 1981.
TSO
ANNuAl REPORT
2011
cORPORATE gOvERNANcE STATEMENT
CorPoraTe goverNaNCe STaTemeNT
Tishman speyer Office Fund (TsO) is a registered managed investment scheme, which has been listed on the australian securities exchange since December 2004. Tishman speyer australia Limited (TsaL) is the responsible entity of TsO. Tishman speyer australia LTD, L.L.C., an indirect subsidiary of Tishman speyer properties, L.p. (Tishman speyer), based in the United states, is the sole shareholder of TsaL. The principal business of TsaL is to carry out its duties as the responsible entity of TsO. To the extent practicable, and on behalf of both TsaL and TsO, the TsaL board endorses the asx Corporate governance Councils Corporate Governance Principles and Recommendations (ASX Principles). all governance materials (charters, policies and statements) as approved by the TsaL board are reviewed annually. The annual review of governance materials ensures that they continue to be appropriate to the operations of TsaL and TsO and evidences TsaLs commitment to governance which is discussed in detail below. Copies of any governance materials are available on the corporate governance section of the TsaL website (www.tsof.com.au).
The Board Lays Solid Foundations for Management and Oversight The Board of Directors
The board has adopted a formal Charter which sets out responsibilities of the board and management (and in particular the Chief executive Officer). Overall, the board is responsible for providing strategic direction and for monitoring the implementation of that strategy by management, by: ensuring that TsaL and TsO have appropriate corporate governance structures; overseeing the TsaL and TsO businesses, including their control and accountability systems; approving the issuance of equity; approving and monitoring financial and other reporting, including reporting to unitholders; deciding on TsOs capital structure and distribution policy; and reviewing and evaluating the performance of the Chief executive Officer and the Company secretary.
The board is assisted by two formally established Committees: audit Committee; and Compliance & risk management Committee.
For efficiency, the board may also delegate matters to one or more directors, either on a standing or distinct basis.
The Chief executive officer
The Chief executive Officer is responsible for the day-to-day management of TsaL, with all powers, discretions and delegations authorised, from time to time, by the board. in particular, the Chief executive Officer is responsible for: briefing directors in relation to issues as they arise; briefing representatives from Tishman speyer on any material developments concerning TsO, including the australian listed property trust market; making recommendations on TsOs strategic direction, including any financial commitments (such as gearing or hedging policies); approving the annual operating budgets; appointing and removing any executive officers (as defined by the Corporations act); reviewing the performance and recommending the remuneration for the executive officers; and communicating with investors (in accordance with the TsaL Continuous Disclosure policy).
other individuals
The board Charter also sets out the particular responsibilities of the chairman, the Financial Controller and the Company secretary.
The Board is Structured to Add Value The Directors
TsaL currently has five directors. Four directors are non-executive directors, while the Chief executive Officer is an executive director. Two non-executive directors, Jerry speyer and rob speyer, represent the cornerstone interest of Tishman speyer. Due to their interest in Tishman speyer, Jerry speyer and rob speyer are not considered independent. There are two independent non-executive directors, graham Kelly and richard haddock. both independent directors have significant experience leading and governing australian businesses. graham Kelly is the independent chairman of TsaL. The Chief executive Officer, David augarten, has an intimate understanding of the global Tishman speyer business and effectively acts as the conduit between management and the board. Due to his executive employment with TsaL, David augarten is not considered independent. TsaL does not have a majority of independent directors. given the experience and background of each of the directors, the board considers that the two independent non-executive directors are aware of and capable of acting in an independent manner and in the best interests of unitholders.
all directors, regardless of whether or not they are deemed to be independent, are expected to express an objective opinion in relation to all TsaL and TsO matters. Details of the directors, their qualifications, skills and experience are detailed on page 31. Four directors have held their positions on the board of TsaL since its inception in 2004. The current Chief executive Officer was appointed in February 2009. independent professional advice is available to directors, if necessary, at the expense of TsaL.
Selection and appointment of Directors
independent non-executive directors receive formal letters of appointment setting out the key terms, conditions and expectations of their appointment. given the size of TsaL, it is not considered necessary that a formal nominations committee be established. in appointing directors, the board must ensure that the candidate has the appropriate range of skills, experience and expertise that will best complement board effectiveness. The TsaL board recognises that it must be able to consider current and emerging business issues and challenge the performance of management. in addition, candidates must confirm that they have the necessary time to devote to their TsaL board position.
Board and management access to information
independent non-executive directors will be given an induction program to ensure that they have a working knowledge of TsaL, TsO (including TsOs investments) and the listed property trust market. The directors have access to all relevant information and have access to the services of the Company secretary for advice on board policy and procedures and governance matters. Directors may meet with, or independent of, management at any time to discuss any areas of interest or concern.
Board and management Performance
no formal board assessment was conducted during Financial year 2010/2011, although it is the responsibility of the Chair to continually review the operation and performance of the board. as there are no employees of TsO, it is not applicable to provide a description of the senior executive performance reviews that have taken place during the 2010/2011 year.
independence
independent directors are those who have the ability to exercise their duties unfettered by any business or other relationship. it is the approach and attitude of each non-executive director that is critical to determining independence, and those factors must be considered in relation to each director, while taking into account all other relevant factors, which may include whether the nonexecutive director: (i) is a substantial unitholder (within the definition of the Corporations act) of TsO, or an officer of, or otherwise associated directly with, a substantial unitholder of TsO; (ii) has, within the last three years, been employed in an executive capacity by TsaL;
(iii) has, within the last three years, been a principal of a material professional adviser or a material consultant to TsaL or TsO or an employee materially associated with the service provided. in this context, the relationship with the professional adviser or consultant shall be deemed to be material if payments from TsaL or TsO exceed 10% of TsaLs or TsOs annual expenditure to all professionals and consultants or exceed 10% of the recipients annual revenue for advisory or consultancy services; (iv) is a material supplier or customer of TsaL or TsO, or an officer of or otherwise associated directly or indirectly with, a material supplier or customer. in this context, the relationship with the supplier or customer shall be deemed to be material if annual payments to or from that supplier or customer exceed 10% of the annual consolidated gross revenue of either TsaL or TsO or of that supplier or customer; (v) has any material contractual relationship with TsaL or TsO other than as a director; (vi) has served on the board for a period of time, the extended duration of which could, in and of itself materially affect the directors ability to act in the best interests of TsaL or TsO; or (vii) is free from any interest and any business or other relationship that could, or could reasonably be perceived to, materially interfere with the directors ability to act in the best interests of TsaL or TsO.
The Board Promotes Ethical and Responsible Decision-Making
The TsaL Code of Conduct & ethics applies to all people when they represent TsaL and/or TsO, and deals with: compliance with laws and regulations; unacceptable payments and contributions; giving or receiving gifts; protection of assets; proper accounting; dealing with auditors; unauthorised public statements; conflicts of interest; and use of inside information.
The Code recognises TsaLs obligations to all legitimate stakeholders from time to time where and to the extent appropriate. The TsaL employee handbook also governs employees behaviour when representing TsaL. The Code encourages employees to report on possible breaches and observances of possible breaches and sets out the process to be followed for reporting any possible breaches of the Code. a copy of the Code is given to all employees, contractors and relevant personnel. in addition to the TsaL Code of Conduct & ethics, the TsaL directors Code of Conduct & ethics governs the way in which TsaL directors should conduct themselves in the discharge of their duties as board and Committee members. a copy of both Codes are given to all directors.
Securities Trading
The TsO securities Trading policy sets guidelines designed to protect TsO, TsaL and TsaL employees (including directors) from intentionally or unintentionally breaching the law. TsaL employees must not purchase or dispose of TsO units while in possession of material non-public information or during the blackout periods defined in the policy. as there is no equity-based remuneration within TsO, there is no current need for any policy on prohibiting the entry into transactions in associated products that limit the economic risk of participating in unvested entitlements under any equity-based remuneration scheme (i.e. an anti-hedging policy). The TsO securities Trading policy, in accordance with revisions to the asx Listing rules (effective 1 January 2011) was updated and released on the asx Company announcements platform in December 2010 and the TsO website.
Diversity Policy
in may 2011, TsaL released its Diversity policy. The Diversity policy explains TsaLs commitment to promoting a positive workplace culture and employment based on personal capabilities and qualifications, free from discrimination and harassment. The policy has been developed with regard to TsaLs size and intended realisation strategy. no formal review of the policy or measurable objectives took place in Financial year 2010/2011.
Conflicts management
as required by section 912a(1)(aa) of the Corporations act, TsaL has a Conflicts management policy that adopts the following principles in relation to the management of conflicts of interest with regard to both retail and wholesale investors: to act fairly and honestly towards investors; to endeavour to identify conflicts of interest; to avoid conflicts of interest that may have materially detrimental consequences for TsaL, TsO or investors; where a conflict of interest cannot be avoided and TsaL forms the view that the situation can be managed to prevent adverse consequences to investors, make appropriate disclosure to the investor of that conflict; to adopt and promote a culture within TsaL of conflict of interest awareness; and to effectively manage conflicts of interest that arise within TsaL.
The Board Safeguards the Integrity of Financial Reporting audit Committee
The board has an audit Committee that: has three members who are all non-executive directors (two of whom are independent directors) (richard haddock (independent Chair who is not Chair of the board), rob speyer and graham Kelly); has met twice during the 2010/2011 Financial year (all Committee members attended both meetings); includes members who are all financially literate; has a written Charter;
is responsible for: (i) the reliability and integrity of financial information for inclusion in the TsaL and TsO financial statements; (ii) audit, accounting and financial reporting obligations of TsaL and TsO; (iii) safeguarding the independence of the external auditor; and (iv) financial risk management.
external auditor
The audit Committee has direct, unlimited access to the external auditor and has the ability to seek independent advice at the expense of TsaL. The board and the audit Committee monitor the independence of the external auditor. The audit Committee observes the policies and procedures for the selection, appointment and reappointment of the external auditor and the rotation of external audit engagement partners. The Committee will: (i) recommend to the TsaL board the appointment and removal of the external auditor; (ii) ratify, upon delegated approval by the Chief executive Officer, and recommend to the TsaL board: (a) the terms of appointment or reappointment of the external auditor; and (b) the level of fees payable to the external auditor; (iii) at least annually, assess the performance and independence of the external auditor and whether the independence of this function is maintained, having regard to the provision of non-audit related services. although not applying to registered schemes (such as TsO), the TsaL board has adopted the spirit of section 300(11b) of the Corporations act. The board has therefore resolved that: The directors are satisfied that: (a) the non-audit services provided during the 2010/2011 financial year by ernst & young as the external auditor were compatible with the general standard of independence for auditors imposed by the Corporations act; and (b) any non-audit services provided during the 2010/2011 financial year by ernst & young as the external auditor did not compromise the auditor independence requirements of the Corporations act for the following reasons: (i) ernst & youngs services have not involved partners or staff acting in a managerial or decision-making capacity within TsaL or been involved in the processing or originating of transactions;
(ii) ernst & young partners and staff involved in the provision of non-audit services have not participated in associated approval or authorisation processes related to the audit (there being a complete separation between the two functions); (iii) a description of all non-audit services undertaken by ernst & young and the related fees have been reported to the audit Committee to ensure complete transparency in relation to services provided; and (iv) the declaration required by section 307C of the Corporations act confirming independence has been received from ernst & young. This resolution was made by the TsaL board upon the written advice of the TsaL audit Committee (as per section 300(11D)(a)).
The Board Makes Timely and Balanced Disclosure
TsaL has an established process to ensure that it is in compliance with the asx Listing rules disclosure requirements applicable to TsO, and this process is reflected in the TsO Continuous Disclosure policy. This process includes a periodic confirmation by applicable members of management that the respective areas for which they are responsible have complied with that policy.
The Board Respects the Rights of Unitholders
TsO has an effective Unitholder Communications policy which promotes effective communication with unitholders, including beneficial holders. TsaL places all market announcements on the TsO website and all registered parties receive an email notification when an announcement is made. all unitholders and members of the public are encouraged to register for this notification service. additionally, all information regarding participation details for publicly broadcast announcements are placed on the home page of the TsO website ahead of the announcement. as a Trust, TsO is not required to hold an annual general meeting (agm). in the event that an extraordinary general meeting (egm) is called, TsaL, as the responsible entity of TsO, will request the external auditor to attend (and, where applicable be available to answer unitholder questions) in respect of any resolutions put to unitholders.
The Board Recognises and Manages Risk
The investments made by TsO involve a range of strategic, operational, financial and legal risks. recognising this, the board has established a sound system of risk oversight and management and internal control designed to identify, assess, monitor and manage risk. The boards Committees assist with this oversight and internal control. The audit Committee is responsible for monitoring financial risk management, while the Compliance & risk management Committee is responsible for monitoring business (nonfinancial) risk management. The Chief executive Officer is responsible for implementing and reporting on the risk management and internal control system. The Chief executive Officer reports to the board and its Committees, as appropriate, on the management of risks.
Compliance & risk management Committee
The Compliance & risk management Committee: has three members (graham Kelly, richard haddock and David augarten), the majority of whom are external members as defined by section 601Jb of the Corporations act; has a chairman who is an external member (graham Kelly); has a written Charter; is responsible for: (i) ensuring overall compliance of TsaL as a responsible entity; (ii) monitoring compliance with (and reporting necessary breaches of ) the Compliance plan, the Corporations act and the TsO Constitution;
(iii) assessing the adequacy of the Compliance plan; (iv) business risk management (including monitoring the internal control framework); and (v) compliance with any other legal and regulatory obligations in addition to i. and ii. above. Duties of Committee members are set out in section 601JD of the Corporations act. Those responsibilities are in addition to other statutory and common law duties imposed upon directors. To date, no breaches have been identified in Financial year 2010/2011, and the Compliance plan auditor has issued an unqualified audit opinion. although the auditor has issued an unqualified audit opinion, an emphasis of matter, identical to the one included in the audit opinion of the TsO financial report, has been included in the audit opinion of the Compliance plan. For further information, please refer to page 89 of the TsO 2011 annual report. regarding risk management oversight, the Compliance and risk management Committee periodically reviews and monitors: the business risk management framework; response to TsOs business risks (including compliance and internal controls); managements approach to key operational risks, including the effectiveness of internal controls; and the implementation of key recommendations and management action plans.
During Financial year 2010/2011, the Compliance & risk management Committee met four times. TsO has a compliance and risk management system in place that sets out the policy and procedures of TsaL in effecting an integrated compliance and risk management system. TsOs compliance plan and the TsaL compliance manual form part of the overall compliance and risk management system that is overseen by the board and Committees. The policy and related procedures establish a system that endeavours to minimise the risk of non-compliance with laws or regulations impacting on the business activities of TsaL and to establish a system for identifying and managing material business risks relating to those business activities. The Compliance & risk management Committee receives reports on the implementation, effectiveness and review of the compliance and risk management system. management has reported that TsOs material business risks are being managed effectively. To ensure effective communication between the two Committees that are responsible for risk management, at least one member of the audit Committee must also be a member of the Compliance & risk management Committee. Currently, there are two common members. The responsibilities of the audit Committee are detailed in the part of this Corporate governance statement regarding financial reporting. in accordance with recommendations 7.2 and 7.3 of the asx principles, the Chief executive Officer and the Financial Controller have stated to the board (with regard to TsO) that: the management of TsOs material business risks is effective; and the declaration made in accordance with section 295a of the Corporations act (in relation to the financial statements) is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks. That declaration forms part of the recommendations made to the audit Committee, and subsequently to the board, when considering the financial statements.
The Board Remunerates Fairly and Responsibly
The only directors who are remunerated by TsO are the independent non-executive directors, graham Kelly and richard haddock. Details of the remuneration paid to the independent non-executive directors are set out on page 82 of the TsO 2011 annual report. no employees, including executive officers, are remunerated by TsO. in relation to all directors and employees, there is no TsO equity-based remuneration paid. Other than statutory superannuation in relation to the independent non-executive directors, there are no retirement benefits paid from TsO assets. in light of the actual remuneration paid by TsO, it is not considered necessary to establish a formal remuneration committee.
Nicole Moodie
Company Secretary
TSO
fINANcIAl REPORT
fOR THE YEAR ENdEd 30 JuNE 2011
CoNTeNTS
For The year eNDeD 30 jUNe 2011
DireCTOrs repOrT aUDiTOrs inDepenDenCe DeCLaraTiOn sTaTemenT OF COmprehensive inCOme baLanCe sheeT sTaTemenT OF Changes in eQUiTy Cash FLOW sTaTemenT nOTes TO The FinanCiaL sTaTemenTs DireCTOrs DeCLaraTiOn inDepenDenT aUDiTOrs repOrT U.s. DOLLar sTaTemenT OF COmprehensive inCOme U.s. DOLLar baLanCe sheeT U.s. DOLLar Cash FLOW sTaTemenT nOTes TO The U.s. DOLLar inFOrmaTiOn
45 49 50 51 52 53 54 87 88 90 91 92 93
DireCTorS rePorT
The directors of Tishman speyer australia Limited (TsaL) (abn 43 106 909 871), the responsible entity of Tishman speyer Office Fund (TsO, the Fund) present their report, together with the consolidated financial report of TsO and its controlled entities for the year ended 30 June 2011 and the independent audit report thereon. all amounts in this report are in australian dollars unless otherwise stated.
DIRECTORS
The directors of TsaL during the financial year and until the date of this report are: David neil augarten richard michael haddock graham John Kelly Jerry irving speyer robert Jeffrey speyer Details of directors, their skills, experience and expertise, including any TsaL Committee memberships, are set out on page 31 of the annual report. TsaL is incorporated in australia and has its principal place of business at Level 12, The Chifley Tower, 2 Chifley square, sydney nsW. TsO is a registered managed investment scheme which has been listed on the australian securities exchange (asx) since 1 December 2004.
RELEVANT INTERESTS IN THE FUND
as at the date of this report, the interests of the directors, held directly or indirectly, in TsO were:
FULLy PAID UNITS
David neil augarten richard michael haddock graham John Kelly Jerry irving speyer robert Jeffrey speyer
746,100 500,000
The directors are not party to any contract in which the directors may be entitled to a benefit that confers a right to call for or deliver interests in TsO and the directors have no rights or options over interests in TsO. Tishman speyer company policy currently prohibits non-independent directors and employees from owning units in TsO.
PRINCIPAL ACTIVITy
The principal activity of TsO during the year ended 30 June 2011 was investment in a portfolio of premium office properties in the United states of america (U.s.). There were no significant changes in the nature of the Funds activities during the year.
DireCTorS rePorT
REVIEW AND RESULTS OF OPERATIONS AND STATE OF AFFAIRS
in the opinion of the directors, there were no significant changes in the state of affairs of TsO during the year; however, as disclosed in past periods, TsaL has implemented a strategy designed to strengthen TsOs financial position in the near term, and realise assets and return capital to TsO unitholders in an orderly and efficient manner in the medium term. TsaL has continued to manage TsOs investment portfolio to enable an orderly realisation of investments by 2015, subject to market conditions, and the return of net proceeds to TsO unitholders.
results
The consolidated net profit before tax for the year ended 30 June 2011 was $105.467 million (30 June 2010: $30.574 million). The consolidated net profit after tax attributable to the members of TsO for the year ended 30 June 2011 was $64.506 million (30 June 2010: loss of $17.919 million) and earnings per unit were 19.06 cents (30 June 2010: negative 5.29 cents). The net tangible assets of TsO at 30 June 2011 were $0.78 per unit (30 June 2010: $0.74 per unit). Certain subsidiaries have 31 December year ends in order to comply with U.s. tax and accounting requirements. The financial information of the subsidiaries that is incorporated in TsOs audited consolidated accounts has been prepared for the same reporting period as the parent entity, using consistent accounting policies.
Distributions
no distribution will be paid for the year ended 30 June 2011 and no interim distribution was paid relating to the six months ended 31 December 2010. For the year ended 30 June 2010, no distribution was paid.
UNITS ON ISSUE
TsO had 338,440,904 fully paid units on issue at 30 June 2011 (30 June 2010: 338,440,904 fully paid units).
FUND ASSETS
at 30 June 2011, TsO held assets with a value of $1,065.095 million (30 June 2010: $1,204.760 million). The basis for valuation of the assets is disclosed in note 1 of the financial statements.
FEES PAID TO THE RESPONSIBLE ENTITy AND ASSOCIATES
base management fees of $7,231,241 (2010: $7,846,765) were paid or are payable for the management and operation of TsO in accordance with the terms set out in note 2 of the financial statements.
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
There have been no matters or circumstances that have arisen since the end of the financial year that have significantly affected, or may significantly affect, TsOs operations in future financial years, the results of those operations or TsOs state of affairs in future financial years.
DireCTorS rePorT
LIKELy DEVELOPMENTS AND EXPECTED RESULTS
TsaL intends to continue to manage TsOs investment portfolio to enable the orderly realisation of these investments by 2015, subject to market conditions, and the return of net proceeds to TsO unitholders. except as set out above, further information about the likely developments in the operations of TsO in future financial years and the expected results of those operations has been omitted from this report because disclosure of the information is likely to result in unreasonable prejudice to TsO. Further information about TsOs business strategies and its prospects for future financial years has been omitted from this report because disclosure of the information is likely to result in unreasonable prejudice to TsO.
INDEMNIFICATION AND INSURANCE OF OFFICERS AND AUDITORS
The responsible entity has a right of indemnity out of TsOs assets unless the responsible entity has acted with gross negligence, fraudulently or in breach of trust. The directors and officers of the responsible entity are indemnified out of the assets of TsO, through the indemnity from TsO to the responsible entity, against losses incurred while acting on behalf of TsO unless they act with gross negligence, fraudulently or in breach of trust. no amount has been paid under this indemnity during the financial year or to the date of this report. The auditor of TsO is not indemnified out of the assets of the Fund. During the period, TsO paid insurance premiums in relation to an investment managers insurance policy providing insurance cover both to the Fund and to the officers and directors of the responsible entity.
ROUNDING
The amounts contained in this report and in the financial report have been rounded off under the option available to the entity under asiC Class Order 98/0100. The Fund is an entity to which the Class Order applies, and in accordance with that Class Order, amounts in the financial report have been rounded to the nearest thousand dollars, unless otherwise stated.
CORPORATE GOVERNANCE
in recognising the need for the highest standards of corporate behaviour and accountability, the directors of TsaL support the asxs principles of Corporate governance. The responsible entitys Corporate governance statement is contained in the Corporate governance section of the annual report.
DireCTorS rePorT
BOARD COMMITTEES
as at the date of the report, the responsible entity had an audit Committee and a Compliance and risk management Committee. The responsibilities of these committees are described in the Corporate governance statement which is included in the annual report.
AUDITOR INDEPENDENCE AND NON-AUDIT SERVICES
The directors received a declaration from the auditor of TsO which immediately follows this report. Details of non-audit services provided by TsOs auditor, ernst & young, are set out in note 20 of the financial statements. The directors are satisfied that the provision of non-audit services provided by ernst & young as the external auditor is compatible with the general standard of independence for auditors imposed by the Corporations act 2001. The nature and scope of each type of nonaudit service provided means that auditor independence was not compromised. signed in accordance with a resolution of the directors.
GJ Kelly
Chairman Sydney, 16 August 2011
Auditor's Independence Declaration to the Directors of Tishman Speyer Independent audit report to the unitholders of Tishman Speyer Office Australia Limited as Responsible Entity for Tishman Speyer Office Fund Fund
In relationhave audited of the financial report of Tishman Speyer Office Fund for the Fund,ended 30 June the We to our audit the accompanying financial report of Tishman Speyer Office year which comprises 2008,balance sheet of my30 June 2008, and the income have been statement of changes in equity and cash to the best as at knowledge and belief, there statement, no contraventions of the auditor independence requirements of theended on that date,2001 or anyofapplicable code of professional other flow statement for the year Corporations Act a summary significant accounting policies, conduct. explanatory notes and the directors declaration of the consolidated entity comprising the trust and the entities it controlled at the years end or from time to time during the financial year.
Directors Responsibility for the Financial Report

The directors of Tishman Speyer Australia Limited (The Responsible Entity) are responsible for the preparation and fair presentation of the financial report in accordance with the Australian Accounting Standards Ernst & Young (including the Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. In Note 1, the directors also state that the financial report, comprising the financial statements and notes, complies with International Financial Reporting Standards as issued by the International Accounting Standards Board.
Auditors David Simmonds Responsibility Partner Our responsibility is to express an opinion on the financial report based on our audit. We conducted our Sydney audit in accordance with Australian Auditing Standards. These Auditing Standards require that we Ernst & Young comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement. 21 August 2008
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, we consider internal controls relevant to the entitys preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Independence
In conducting our audit we have met the independence requirements of the Corporations Act 2001. We have given to the directors of the company a written Auditors Independence Declaration, a copy of which is included in the directors report. In addition to our audit of the financial report, we were engaged to undertake the services disclosed in the notes to the financial statements. The provision of these services has not impaired our independence.
LiabilityLiability by a scheme scheme approved limited limited by a approved under Professional Standards Legislation under Professional Standards Legislation
STaTemeNT oF ComPreheNSive iNCome
NOTES
CONSOLIDATED 2011 2010 A$000 A$000
Income
share of net income of associates rental income property expenses amortisation of leasing costs and tenant incentives net rental income net borrowing costs managers fees Corporate expenses net income of associates before fair value adjustments net fair value (decrement)/increment on financial derivatives Fair value increment on investment properties share of net income of associates based on 91.82% ownership interest priority allocation of profit to co-investor share of net income of associates attributable to TsO rental income from controlled investment properties Fair value increment on controlled investment properties interest income Total revenue and other income
Expenses
138,477 (55,000) (11,081) 72,396 (26,587) (5,635) (531) 39,643 (41) 77,207 8 8 8 116,809 (25,458) 91,351 35,464 49,723 45 176,583 16,482 49,609 1,596 3,340 17 72 71,116 1(v) 1(v), 4 105,467 220 40,690 64,557 14 (51,329) 13,228 14 64,506 51 13,178 50 19.06
160,396 (64,567) (11,241) 84,588 (31,786) (5,863) (1,371) 45,568 1,034 18,023 64,625 64,625 51,850 13,664 27 130,166 21,341 6,869 60,393 1,984 8,545 121 339 99,592 30,574 241 48,237 (17,904) (16,947) (34,851) (17,919) 15 (34,782) (69) (5.29)
property expenses of controlled investment properties Loss on sale of controlled investment properties borrowing costs managers fees Corporate expenses net fair value decrement on financial derivatives Foreign exchange loss Total expenses Profit before tax expense U.s. withholding tax Deferred tax expense Profit/(loss) after tax expense
Other comprehensive income
2 3
Foreign currency translation loss (no tax effect) Total comprehensive profit/(loss)
Net profit/(loss) after tax attributable to:
Unitholders of TsO non-controlling interests

Total comprehensive profit/(loss) attributable to:
Unitholders of TsO non-controlling interests basic and diluted earnings per unit (cents)
21
The above statement of comprehensive income should be read in conjunction with the accompanying notes.
BaLaNCe SheeT
aS aT 30 jUNe 2011
NOTES
Current assets
Cash and cash equivalents restricted cash receivables Other Total current assets
Non-current assets
5 6
20,776 26,307 946 783 48,812
28,024 1,634 962 30,620
equity accounted investments in associates investment properties Cash (including restricted cash) Other assets non-current interest bearing liabilities Derivative liability Other liabilities share of net assets based on 91.82% ownership interest priority allocation to co-investor Total equity accounted investment in associates attributable to TsO investment properties Total non-current assets Total assets
Current liabilities
11
1,095,627 59,657 11,484 (434,436) (26) (26,926) 705,380 (24,847) 680,533 335,750 1,016,283 1,065,095
1,247,825 65,857 15,366 (473,975) (32,620) 822,453 822,453 351,687 1,174,140 1,204,760
8 8 8 7
Trade and other payables interest bearing liabilities Total current liabilities
Non-current liabilities
10 11
8,774 368,559 377,333
11,811 465,933 477,744
interest bearing liabilities Deferred tax liability preferred stockholders Total non-current liabilities Total liabilities Net assets
Unitholders equity
11 1(v), 4 12
259,916 162,107 457 422,480 799,813 265,282
321,829 152,568 565 474,962 952,706 252,054
Units on issue reserves accumulated losses Total equity attributable to unitholders of TSO non-controlling interests Total equity The above balance sheet should be read in conjunction with the accompanying notes.
13 14 14
677,963 (82,657) (330,105) 265,201 81 265,282
677,963 (31,329) (394,611) 252,023 31 252,054
STaTemeNT oF ChaNgeS iN eqUiTy
UNITS ON ISSUE A$000
FOREIGN CURRENCy TRANSLATION RESERVE A$000
ACCUMULATED LOSSES A$000
TOTAL EqUITy ATTRIBUTABLE TO UNITHOLDERS OF TSO A$000
NON-CONTROLLING INTERESTS A$000
TOTAL EqUITy A$000
Consolidated
At 1 July 2009 (Loss)/income for the period Other comprehensive loss Total comprehensive loss for the year Transaction costs taken to equity At 30 June 2010 income for the period Other comprehensive loss Total comprehensive income for the year At 30 June 2011
677,965 (2) 677,963 677,963
(14,466) (16,863) (16,863) (31,329) (51,328) (51,328) (82,657)
(376,692) (17,919) ( 17,919) (394,611) 64,506 64,506 (330,105)
286,807 (17,919) (16,863) (34,782) (2) 252,023 64,506 (51,328) 13,178 265,201
100 15 ( 84) ( 69) 31 51 (1) 50 81
286,907 (17,904) (16,947) (34,851) (2) 252,054 64,557 (51,329) 13,228 265,282
The above statement of changes in equity should be read in conjunction with the accompanying notes.
CaSh FLoW STaTemeNT
NOTES
Cash flows from operating activities
Distribution received from equity accounted associates receipts in the course of operations interest received payments in the course of operations borrowing costs Fees and other expenses paid (inclusive of gsT) Withholding tax paid Cash held in escrow to fund operating activities Net cash flows used in operating activities
Cash flows from investing activities
15,812 35,262 46 (16,646) (23,755) (4,933) (210) (56,463) 15 (50,887)
6,858 53,530 12 (30,130) (57,896) (10,510) (477) (38,613)
payments for purchase of, and additions to, investment properties net proceeds from sale of investment properties Cash held in escrow to fund additions to investment properties Capital paid from/(to) associates Net cash flows from investing activities
Cash flows from financing activities
(3,876) (1,164) 53,891 48,851
(14,366) 184,130 (169,472) 292
equity transaction costs paid net proceeds from interest bearing liabilities Net cash flows from financing activities Net decrease in cash and cash equivalents held Cash and cash equivalents at the beginning of the financial year effects of exchange rate changes Cash and cash equivalents at the end of the financial year The above cash flow statement should be read in conjunction with the accompanying notes.
(2,036) 28,024 (5,212) 20,776
(2) 5,170 5,168 (33,153) 66,206 (5,029) 28,024
NoTeS To The FiNaNCiaL STaTemeNTS
1. Summary of significant accounting policies (a) Basis of preparation
The financial report is a general purpose financial report, which has been prepared in accordance with the requirements of the Fund Constitution, the Corporations act 2001, australian accounting standards and other authoritative pronouncements of the australian accounting standards board. The financial report has been prepared in accordance with the historical cost convention, except for investment properties and derivative financial instruments which are carried at fair value and interests in associates which are carried at equity accounted value. The financial report has been prepared on a going concern basis because the Fund expects to be able to pay its debts as and when they fall due in the ordinary course of business for the next 12 months. however, the ability to do this is dependent on continued access to adequate funding. Tishman speyer U.s. Office, inc. (Us reiT) has a debt facility that matures on 4 may 2012. it is expected that Us reiT will be able to renew or replace the facility; however, there can be no guarantee that this will happen. Us reiT also requires continued access to adequate cash distributions from its underlying investments to service the current Us reiT facility and any replacement facility. if Us reiT is not able to renew or replace the facility or raise funds in order to repay the loan at the maturity date or if there is a lack of adequate cash distributions from its underlying investments, then doubt may be cast over TsOs ability to realise its assets and discharge its liabilities in the ordinary course of business at the amounts stated in the financial report. The financial report is presented in australian dollars and all values are rounded to the nearest thousand dollars ($000) unless otherwise stated under the option available to the Fund in accordance with asiC Class Order 98/0100. The Fund is an entity to which the Class Order applies.
(b) New accounting standards and interpretations
The financial report complies with australian accounting standards as issued by the australian accounting standards board and international Financial reporting standards (iFrs) as issued by the international accounting standards board. Certain new accounting standards, amendments to accounting standards and interpretations have been published that are not mandatory for the current reporting period. We do not anticipate the impact on the Funds financial report to be material. We will continue to assess the impact as these standards and interpretations come into effect.
(c) Basis of consolidation and equity accounting
The consolidated financial statements comprise the financial statements of TsO and its subsidiaries. subsidiaries are all those entities over which TsO has the power to govern the financial and operational policies so as to obtain benefits from their activities. Financial information for the controlled entities and equity accounted investments has been prepared for the same reporting period as the parent entity, using consistent accounting policies. adjustments are made to bring into line any dissimilar accounting policies which may exist. information from the financial statements of the consolidated entities is included from the date the parent entity obtained control.
1. Summary of significant accounting policies (continued) (c) Basis of consolidation and equity accounting (continued)
all inter-entity balances and transactions, income and expenses and profits and losses resulting from intra-group transactions have been eliminated in full. non-controlling interests not held by TsO are allocated their share of net profit after tax in the statement of comprehensive income and are presented within equity in the consolidated balance sheet, separately from TsOs equity. TsO has an indirect interest in empire hawkeye partners, L.p. (empire hawkeye) and prime plus investments, inc. (prime plus). The Fund has significant influence, but does not control these entities. accordingly, on consolidation, the Fund has adopted the equity method of accounting for these investments. Under this method, the consolidated entitys share of the profits or losses of prime plus and empire hawkeye is recognised in the consolidated statement of comprehensive income and its share of movements in reserves is recognised in the consolidated balance sheet. Further details in respect of the accounting for TsOs entitlement to income from its associates is given in note 8.
(d) Significant accounting judgements, estimates and assumptions
(i) Significant accounting judgements management has made the following judgements, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements:
OperaTing Lease COmmiTmenTs
space in each of the investment properties owned by TsOs subsidiaries and associates is leased to third parties. The consolidated entity has determined that it retains all the significant risks and rewards of ownership of these properties and has accordingly classified the leases as operating leases. (ii) Significant accounting estimates and assumptions The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. There are no key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period apart from the following assumptions:
invesTmenT prOperTies
refer note 1(f ).

perFOrmanCe Fee aCCrUaL
refer note 2.
priOriTy aLLOCaTiOn OF prOFiT TO CO-invesTOr
refer note 8.
DeFerreD Tax LiabiLiTy
refer notes 1(v), 4.
1. Summary of significant accounting policies (continued) (e) Foreign currencies
Translation of foreign currency transactions The functional and presentation currency of the parent entity is australian dollars. each entity in the TsO group determines its own functional currency, and items included in the financial statements of each entity are measured using that functional currency. Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates ruling at the date of the transaction. monetary assets and liabilities denominated in foreign currencies that are outstanding at the reporting date (other than monetary items arising under foreign currency contracts where the exchange rate for that item is fixed in the contract) are retranslated at the rate of exchange ruling at the balance sheet date. at 30 June 2011, an exchange rate of a$1.00 = Us$1.0597 (30 June 2010: a$1.00 = Us$0.8567) was used. exchange differences on monetary items are recognised in the statement of comprehensive income in the period in which they arise. Differences arising on a monetary item forming part of the net investment in a foreign operation are taken to the foreign currency translation reserve on consolidation. Translation of financial reports of foreign operations The functional currency of TsOs controlled entities and equity accounted investments is United states dollars. as at the reporting date, the assets and liabilities of these entities are translated into the presentation currency of TsO at the rate of exchange ruling at the balance sheet date and the statements of comprehensive income are translated at the average exchange rates for the year. The exchange differences arising on the translation are taken directly to the foreign currency translation reserve.
(f) investment properties
TsOs interests in investment properties held by its subsidiaries and its equity accounted share of investment properties held by associates are carried at fair value. independent valuations of investment properties are obtained at intervals of not more than three years from suitably qualified property valuers. such valuations are reflected in the financial statements of TsO. notwithstanding, the directors of Us reiT and the responsible entity assess the carrying value of each investment property at each reporting date to ensure that the carrying value of each asset does not materially differ from its fair value. Where the carrying value differs from fair value, the relevant assets are adjusted to their fair value. The prime valuation methodology used in determining fair value, is to discount the expected net cash flows to their present value using a market determined risk adjusted discount rate applicable to the respective asset. additional support is provided by other income capitalisation techniques, the sales comparison and cost approaches to value. Changes in the fair value of an investment property are recorded in the statement of comprehensive income. expenditures capitalised to properties include the costs of acquisition and capital and refurbishment additions. Land and buildings are considered to have the function of an investment and are therefore regarded as a composite asset. The buildings and components thereof (including plant and equipment) are not depreciated.
1. Summary of significant accounting policies (continued) (g) investment in controlled entities
balances and transactions between TsO and its controlled entities have been eliminated in preparing the consolidated financial statements.
(h) Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and short-term deposits with an original maturity of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
(i) restricted cash
restricted cash balances are required pursuant to certain debt agreements for the payment of future capital improvements, leasing commissions, real estate taxes, interest and insurance.
(j) receivables
receivables, which generally have 30 day terms, are recognised and carried at original invoice amount, less a provision for any uncollectible debts. an estimate for doubtful debts is made when collection of an amount is no longer probable. bad debts are written off as incurred. receivables from related parties are recognised and carried at the nominal amount due. interest and rent is taken up as income on an accruals basis.
(k) Financial assets
Loans classified as financial assets are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. These assets are initially measured at fair value and are subsequently carried at amortised cost using the effective interest method.
(l) Derivatives
TsO is exposed to changes in interest rates and foreign exchange rates and may use interest rate swaps or caps, foreign exchange contracts and other derivatives to manage these risks. There are policies and limits in respect of the use of derivatives to hedge cash flows subject to interest rate and currency risks. Derivatives are not entered into for speculative purposes and the hedging policies are approved and monitored by the board. accounting standards, however, include onerous documentation, designation and effectiveness requirements before a derivative financial instrument can qualify for hedge accounting. The documentation, designation and effectiveness requirements set out in the accounting standards can not be met in all circumstances by TsO. Those derivatives that are cash flow hedges and that do qualify for hedge accounting are recorded at fair value through equity until the hedged transaction occurs and then released to the statement of comprehensive income; those that do not qualify for hedge accounting are recorded at fair value through the statement of comprehensive income. The fair value of derivatives used by TsO is based on a pricing model that incorporates market observable inputs for interest rate curves and unobservable inputs for credit spreads.
1. Summary of significant accounting policies (continued) (m) Payables
Liabilities for creditors are carried at cost, which is the fair value of the consideration to be paid in the future for goods and services received, whether or not billed to the consolidated entity. payables are normally settled within 30 days.
(n) Provision for distribution
a provision for distribution is recognised in the balance sheet if the distribution has been declared or publicly recommended on or before balance date.
(o) interest bearing loans and borrowings
Loans and borrowings are initially recognised at fair value of the consideration received less directly attributable transaction costs and are subsequently measured at amortised cost using the effective interest method.
(p) Contributed equity
issued capital is recognised at the fair value of the consideration received by the Fund. any transaction costs arising on the issue of ordinary units are recognised directly in equity as a reduction of the unit proceeds received.
(q) investment revenue
revenue from rents, interest and dividends is recognised to the extent that it is probable that the economic benefits will flow to the entity and the revenue can be reliably measured. revenue brought to account, but not received at balance date, is recognised as a receivable. rental income earned under leases with fixed increases is recognised in income on a straight-line basis over the lease term. interest income is recognised as the interest accrues.
(r) Leasing fees
Costs that are directly associated with negotiating and executing the ongoing renewal of tenant lease agreements (including commissions, legal fees and costs of preparing and processing documentation for new leases) are capitalised to the carrying value of the property and amortised on a straight-line basis over the lease term.
(s) Leasing incentives
Lease incentives in the form of up-front payments, contributions to certain lessees costs, relocation costs and fit-outs that are offered in relation to the ongoing operation of the property are recognised as part of the carrying value of the investment properties. The aggregate cost of incentives is recognised on a straight-line basis over the lease term.
(t) impairment of assets
The directors of Us reiT and the responsible entity assess at each reporting date whether there is an indication that an asset may be impaired. if any such indication exists, an estimate is made of the assets recoverable amount. When the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
1. Summary of significant accounting policies (continued) (u) Borrowing costs
borrowing costs are recognised as an expense when incurred. no borrowing costs have been capitalised as part of the cost of a qualifying asset during the year.
(v) Taxes
Income tax Under current australian tax legislation, the Fund is not liable to pay australian income tax provided its taxable income and taxable realised gains are fully distributed to unitholders. Under the U.s. internal revenue Code, Us reiT has elected to be taxed as a real estate investment Trust (reiT), and on this basis, Us reiT should not be subject to U.s. federal income taxes to the extent that it distributes annually all of its taxable income and capital gains to its shareholders. in order to maintain its qualification as a reiT, Us reiT must distribute at least 90% of its taxable income (net of capital gains) to its shareholders annually. if taxable income is distributed, a U.s. withholding tax liability will arise. The Fund may realise a capital gain or loss on disposal of its U.s. investments which may attract a U.s. tax liability. if a capital gain is distributed, a U.s. withholding tax liability may arise and give rise to a foreign tax credit which would be available to australian unitholders. Under australian accounting standards, a deferred tax liability or asset must be recognised, based on movements in the carrying value and tax cost base of investment property assets and taking into account the assumed amount distributable to TsO in respect of the disposal of properties, with any movements reflected in the statement of comprehensive income as a tax expense. Goods and services tax revenues, expenses and assets (with the exception of receivables) are recognised net of the amount of goods and services Tax (gsT) to the extent that the gsT is recoverable from the taxation authority. Where gsT is not recoverable, it is recognised as part of the cost of acquisition, or as an expense. receivables and payables are stated inclusive of gsT. The net amount of gsT recoverable from, or payable to, the taxation authority is included in the balance sheet as a receivable or payable. Cash flows are included in the cash flow statement on a gross basis. The gsT component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows.
(w) earnings per unit (ePU)
basic epU is calculated as net profit attributable to members divided by the weighted average number of ordinary units. Diluted epU is calculated as the net profit attributable to members divided by the weighted average number of ordinary units adjusted for the effects of all dilutive potential ordinary units. TsO has no dilutive potential ordinary units, therefore its basic and diluted epU are the same.
2. Responsible entitys and managers fees
The responsible entity of TsO is TsaL. The manager of TsOs indirect investments in empire hawkeye and the subsidiaries holding the investments in the Lakeside Complex and the beverly hills properties is Tishman speyer australia asset manager, L.L.C. (Ts manager). The ultimate parent of TsaL and Ts manager is Tishman speyer properties, L.p. (Tsp). TsaL and Ts manager are entitled to receive the following remuneration from TsO, Us reiT and their subsidiaries and associates.
Base management fee
TsaL and Ts manager are collectively entitled to receive a management fee calculated at the rate of 0.50% per annum of TsOs proportionate share of the gross value of investment assets held directly or indirectly by TsO. gross value is based on the carrying value of each investment asset. The base fee paid or payable for the year ended 30 June 2011 is $7,231,241 (30 June 2010: $7,846,765).
Performance fee
Ts manager is entitled to a performance fee on TsOs investment in Us reiT excluding empire hawkeye if certain outperformance is achieved. Under the terms of the restructured Us reiT facility described in note 11(a), all future performance fees will be calculated based on returns since inception and paid on the realisation of TsOs assets and subordinated to the full repayment of the Us reiT facility. The performance fee is payable if the investment return to Us reiT exceeds a hurdle rate of 10.5% per annum. This hurdle rate is calculated as a notional investment return based on Us reiTs equity investments excluding empire hawkeye and net cash flow distributed from those investments to Us reiT during the holding period. net cash flow is calculated after all fees and expenses paid by the subsidiaries (excluding base management fee) and after all debt service related to the investments and allowance for market disposal fee. To the extent the calculated investment return exceeds 10.5% per annum, a fee equal to 30% of the total excess return will be payable. assuming realisation of the assets and repayment of debt at 30 June 2011, no provision has been made at 30 June 2011 or 30 June 2010 for the fees payable on TsOs investment in Us reiT excluding empire hawkeye. management has also assessed the impact on the provision of a 5% increase in the fair value of properties held in Us reiTs subsidiaries and has determined that the provision would not be impacted. market factors, outside of the control of TsO, may impact future assessments of property values, rental income and capital expenditure, each of which is a key input into the calculation of the performance fee provision. as a result of these uncertainties, the provision for the performance fee may require material adjustment in a future period. a promote distribution is payable on Us reiTs investment in empire hawkeye if certain outperformance is achieved. The details of this distribution are set out in note 8.
2. Responsible entitys and managers fees (continued) Disposal fee
Ts manager is entitled to a disposal fee at market rates prevailing at the time of the disposal of a property in which one of Us reiTs subsidiaries has a direct or indirect interest, but in any event not to exceed 1% of the Funds proportionate share of the sale price of the property. no disposal fees were paid during the year ended 30 June 2011 (30 June 2010: $1.912 million).
acquisition fee
Ts manager is entitled to an acquisition fee of 1% of the purchase price, or the Funds proportional share, of any property assets in which a direct or indirect interest is acquired outside empire hawkeye. There were no acquisition fees paid in the years ended 30 June 2011 or 30 June 2010. Under the terms of the restructured Us reiT facility, Us reiT may not make additional acquisitions until repayment of the Us reiT facility.
3. Corporate expenses
audit fees Tax consulting/compliance fees Legal fees Consulting fees Listing and filing fees registry fees Directors fees insurance annual report printing and mailing Other
1,258 103 393 43 109 274 753 49 358 3,340
1,727 305 2,426 2,862 42 123 283 627 38 112 8,545
4. Deferred tax expense
if the U.s. entities in which TsO directly and indirectly owns an interest sell U.s. real estate assets at a gain, TsO may incur a U.s. tax liability on the distributions it receives. in such a case, a foreign tax credit would be available to australian unitholders. a deferred tax liability in relation to the U.s. tax has been recognised based on movements in the carrying value and tax cost base of investment property assets and taking into account the assumed amount distributable to TsO in respect of the disposal of properties. The balance of the deferred tax liability at 30 June 2011 was $162.107 million (30 June 2010: $152.568 million). Certain unresolved issues arose following the publication of a notice by the internal revenue service (irs) in June 2007, in which the irs described its interpretation of certain provisions of the internal revenue Code addressing the treatment of certain distributions by reiTs to foreign owners with respect to proceeds from the sale of U.s. real estate interests. The publication of the notice led to discussions between tax practitioners and U.s. government officials over several months regarding the legal basis of the irss position, the scope of the notice, and collateral implications not directly addressed in the notice. in particular, the notice did not address its application to tiered reiT structures or to cases in which a foreign owners tax basis in its reiT stock differed from its share of the reiTs tax basis in its assets. several of those issues and uncertainties in interpretation were described in a report prepared by the american bar associations section of Taxation, which was submitted to the U.s. government in June 2008. (several issues arising from the notice have yet to be publicly addressed in any forum.) Following the issuance of the american bar association report and public discussion of the notice, tax practitioners (including TsOs tax advisors) and TsOs management have become aware of the wide scope of transactions potentially impacted by the notice. Those transactions potentially include the disposition of the investments of prime plus investments, inc. pursuant to a 24 month plan of liquidation previously disclosed. The accounting implication of the notice and the subsequent discussions and commentaries regarding its impact is that provision has been made in the accounts for tax that may be paid in the future, depending on the ultimate resolution of issues relating to positions taken in the notice. Certain of those tax consequences might arise if some of the real estate assets in which TsO indirectly owns an interest are sold, as opposed to a sale of ownership interests in the entities that indirectly own such real estate. Those consequences arise due to the fact that the tax basis in the interests in the entities that indirectly own the real estate is higher than such owners share of the tax basis in the real estate, and the concern that the notice reflects the irss view that the taxable gain would be measured by reference to the tax basis in the real estate without reduction for the tax basis in the interests in the entities owning such real estate. TsO continues to evaluate the amount of the potential tax liability in light of the current facts and ongoing uncertainties relating to the application of the irs notice.
5. Restricted cash
The restricted cash balance largely represents cash held in a lender controlled interest reserve to pay the interest costs under the Us reiT loan. Future interest payments under the Us reiT loan will be paid directly from this account.
6. Receivables (current)
Trade receivables less: provision for doubtful debts Other receivables receivable from related parties
333 (22) 311 611 24 946
682 (66) 616 462 556 1,634
Other than the trade receivables provided for there are no receivables that are past due. The amount past due is over 120 days overdue.
7. Investment properties
investment properties held by controlled entities at fair value investment properties held in equity accounted investments at fair value (i)
335,750 1,095,627 1,431,377
351,687 1,247,825 1,599,512
included in the carrying value of investment properties held by controlled entities and associates are the following: Lease incentives straight-line asset (ii) Lease commissions 61,981 56,798 34,670 153,449 71,175 58,709 42,790 172,674
(i) TsOs interest in investment properties held by equity accounted investments is held through its indirect 45.9% interest in prime plus. The amounts set out in this note represent TsOs 45.9% interest in the properties held by prime plus. (ii) asset arising from recognising lease income on a straight-line basis in accordance with note 1(q).
(a) reconciliation of carrying amounts
a reconciliation of the carrying amount of investment properties at the beginning and end of the financial year is set out below: Carrying amount at the start of the year additions by controlled entities additions by equity accounted associates Disposals by equity accounted associates Disposals by controlled entities revaluation Foreign exchange losses Carrying amount at the end of the year 1,599,512 3,817 14,344 126,930 (313,226) 1,431,377 1,832,292 15,007 25,551 (2,290) (190,999) 31,687 (111,736) 1,599,512
7. Investment properties (continued) (b) Details of investment properties held through subsidiaries and equity accounted investments
ACqUISITION DATE ORIGINAL ACqUISITION COST US$000 TOTAL COST INCLUDING ADDITIONS US$000 DATE OF LATEST EXTERNAL VALUATION LATEST EXTERNAL VALUATION US$000 BOOK VALUE AT 30 JUN 2011 US$000 BOOK VALUE AT 30 JUN 2011 A$000
PROPERTy
INTEREST
300 park avenue Cityspire greenwich american Centre bala plaza 227 West monroe street 222 West adams street plaza east i and ii 520 pike Tower One bush street 595 market street bayside Towers 400 Castro street Equity accounted investments Lakeside Complex maple plaza 407 north maple Drive beverly mercedes place non-controlling interest Controlled subsidiaries Total investment properties
45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9%
1 Dec 04 1 Dec 04 1 Dec 04 1 Dec 04 1 Dec 04 1 Dec 04 1 Dec 04 1 Dec 04 1 Dec 04 1 Dec 04 27 Jul 05 1 Dec 04
184,457 48,049 51,694 62,917 221,949 118,779 20,877 45,524 40,684 32,327 31,156 27,845
210,466 55,067 61,382 75,513 262,398 148,899 24,909 51,095 45,705 42,155 33,525 30,348
1 apr 11(i) 1 apr 11

(i)
355,725 76,653 87,210 64,903 198,747 104,193 21,894 45,303 61,506 61,506 30,845 47,552
357,103 76,490 86,942 65,572 199,163 104,411 22,655 46,424 61,465 62,408 30,850 47,553
336,985 72,181 82,044 61,878 187,943 98,529 21,379 43,808 58,002 58,892 29,112 44,874
1 apr 11(i) 1 apr 11

(i)
1 apr 11(i) 1 apr 11(i) 1 apr 11(i) 1 apr 11(i) 1 apr 11 1 apr 11
(i)
1 apr 11(i)
(i)
1 apr 11(i)
886,258 1,041,462 99.9% 99.9% 99.9% 99.9% 26 sep 05 4 may 07 4 may 07 4 may 07 90,660 166,299 99,739 68,463 426 425,587 94,446 172,459 103,006 71,916 442 442,269 1 apr 11
(i)
1,161,036 1,095,627 49,950 148,851 94,306 60,939 354 49,873 149,147 94,337 62,082 356 355,795 47,063 140,745 89,022 58,584 336 335,750 1 apr 11(i) 1 apr 11
(i)
1 apr 11(i)
1,311,845 1,483,731
1,516,831 1,431,377
(i) These valuations have been performed by independent valuers who hold recognised and relevant professional qualifications and have recent experience in the location and category of the investment property being valued.
7. Investment properties (continued) (c) valuation summary

LATEST EXTERNAL VALUATION AS AT 30 JUNE 2010 US$000 TERMINAL CAP RATE % DISCOUNT RATE % LATEST EXTERNAL VALUATION AS AT 30 JUNE 2011 US$000 TERMINAL CAP RATE % DISCOUNT RATE %
PROPERTy
INTEREST
300 park avenue Cityspire greenwich american Centre bala plaza 227 West monroe street 222 West adams street plaza east i and ii 520 pike Tower One bush street 595 market street bayside Towers 400 Castro street Lakeside Complex maple plaza 407 north maple Drive beverly mercedes place
8. Investments in associates
45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 45.9% 99.9% 99.9% 99.9% 99.9%
332,775 73,440 80,325 61,552 186,813 97,767 21,803 40,392 50,031 56,916 21,527 38,831 58,941 116,284 73,926 53,546
7.00 6.50 8.00 8.75 7.50 7.50 9.50 8.50 6.50 6.75 8.00 8.00 8.50 8.00 8.00 8.00
8.50 8.50 9.00 10.00 8.50 8.50 10.50 9.25 8.00 8.25 8.88 9.25 9.50 9.25 8.75 8.75
355,725 76,653 87,210 64,903 198,747 104,193 21,894 45,303 61,506 61,506 30,845 47,552 49,950 148,851 94,306 60,939
6.50 6.50 7.75 8.29 7.25 7.25 9.00 8.25 6.25 6.25 7.25 7.00 8.20 6.75 6.75 6.75
8.50 8.50 8.75 9.05 8.25 8.25 10.00 9.00 7.75 7.75 8.50 8.25 8.68 8.75 8.25 8.25
TsO has an indirect 91.82% limited partner interest in empire hawkeye, which in turn has a 49.99% interest in prime plus which holds interests in office properties located in the United states. as a result, TsO has effective ownership of an indirect 45.9% interest in prime plus. TsO also has an indirect 49.99% interest in Ts Office Tenant services, inc. TsO does not control empire hawkeye, prime plus or Ts Office Tenant services, inc.; however, it exercises significant influence over the entities. accordingly, TsOs investments in these entities are accounted for using the equity method of accounting. empire hawkeye, prime plus and Ts Office Tenant services, inc. are all resident in the United states. They have 31 December reporting dates in order to comply with U.s. tax and accounting requirements, however; the financial information that is recorded in TsOs consolidated accounts has been prepared for the same reporting period as the parent entity, using consistent accounting policies.
8. Investments in associates (continued)

(a) movements in carrying amount of investments in associates
Carrying amount at the beginning of the financial year share of net income of associates attributable to TsO Contribution (from)/to associates Distributions received from associates Foreign exchange translation differences Carrying amount at the end of the financial year represented by: empire hawkeye Ts Office Tenant services, inc.
822,453 91,351 (62,460) (15,812) (154,999) 680,533 680,510 23 680,533
628,482 64,625 169,472 (6,858) (33,268) 822,453 822,430 23 822,453
(b) Share of associates assets and liabilities
Current assets non-current assets Total assets Current liabilities non-current liabilities Total liabilities net assets of associates based on 91.82% ownership interest priority allocation of profit to co-investor(i) Net assets attributable to associates of TSO
(c) Share of net income of associates attributable to TSo
71,141 1,095,627 1,166,768 26,952 434,436 461,388 705,380 24,847 680,533
81,223 1,247,825 1,329,048 32,620 473,975 506,595 822,453 822,453
net rental income Other net expenses gains from investment property revaluations profit before income tax income tax expense net income of associates based on 91.82% ownership interest priority allocation of profit to co-investor(i) Share of net income of associates attributable to TSO
72,396 (32,794) 77,207 116,809 116,809 (25,458) 91,351
84,588 (37,986) 18,023 64,625 64,625 64,625
8. Investments in associates (continued) (i) Distribution entitlement to share of profits in empire hawkeye
Fund v (a Tishman speyer sponsored investment fund and co-investor in empire hawkeye) is entitled to a priority allocation of returns (promote distribution or promote) on Us reiTs investment in empire hawkeye if certain outperformance is achieved. prior to the renegotiation in september 2009 of the Us reiT facility described in note 11(a), Fund v, via Ts manager, was entitled to a performance fee calculated at the end of each five years since inception of TsO. Under the terms of the restructured Us reiT facility, the payment of any performance fee at 1 December 2009 was waived. The documents relating to the calculation of the fee were amended with the effect that a promote distribution calculated using the same formula as the original performance fee will be paid to Fund v by empire hawkeye. The promote distribution will be calculated based on returns since inception and paid on the realisation of empire hawkeyes assets and subordinated to the full repayment of the Us reiT facility. TsOs share of net assets on realisation of empire hawkeyes assets will be reduced by the promote distribution. The promote distribution is payable if the investment return on Us reiTs investment in empire hawkeye exceeds a hurdle rate of 10.5% per annum. This hurdle rate is calculated as a notional investment return based on Us reiTs equity investment and net cash flow distributed to Us reiT during the holding period. net cash flow is calculated after all fees and expenses paid by the associates (excluding base management fee, the promote distribution or any withholding for tax) and after all debt service related to the investments and allowance for market disposal fee. The investment returns relating to the empire hawkeye investment and the investments held outside empire hawkeye are calculated discretely and the returns on the empire hawkeye investment are not used to offset the returns on other investments or vice versa. To the extent the calculated investment return exceeds 10.5% per annum, Fund v is entitled to a share of profits equal to 30% of Us reiTs excess return. This will reduce Us reiTs entitlement to 70% of the excess return. at 30 June 2011, TsO has estimated that the calculated investment return will exceed 10.5% per annum and has reduced the share of profit it would otherwise have recognised based on 91.82% ownership percentage by $25,458,267. This reflects the expected additional share of profit to which the co-investor is entitled. The calculation assumes realisation of the assets held by associates and repayment of the Us reiT debt at 30 June 2011. no allowance for market disposal fees, other than the Fund v disposal fee (refer (ii) below), or transfer taxes has been included in the calculation of this amount. market factors, outside of the control of TsO, may impact future assessments of property values, rental income and capital expenditure, each of which is a key input into the calculation of investment returns. as a result of these uncertainties, allocation of the share of empire hawkeye profits to TsO may require material adjustment in a future period if these assessments change. This is disclosed in the income statement and balance sheet as the priority allocation of profit to co-investor.
(ii) Disposal fee
Fund v is entitled to a disposal fee at market rates prevailing at the time of the disposal of a property in which empire hawkeye has a direct or indirect interest, but in any event not to exceed 1% of TsOs proportionate share of the sale price of the property. There were no disposal fees paid in the years ended 30 June 2011 or 30 June 2010.
8. Investments in associates (continued) (iii) acquisition fee
Fund v is entitled to an acquisition fee of 1% of TsOs proportionate share of the purchase price of any property asset in which empire hawkeye acquires a direct or indirect interest. There were no acquisition fees paid in the years ended 30 June 2011 or 30 June 2010. Under the terms of the restructured Us reiT facility, empire hawkeye may not make additional acquisitions until repayment of the Us reiT facility. There were no impairment losses relating to the investments in associates. at 30 June 2011, TsOs associates had contractual obligations to pay $17.139 million (TsOs share: $7.867 million) towards property building works. The commitments are largely expected to be settled within 12 months from balance date. There were no contingent liabilities relating to the associates.
9. Parent entity supplementary information
PARENT 2011 A$000 2010 A$000
(a) Parent entitys assets and liabilities
Current assets non-current asset(i) Total assets Current liabilities non-current liabilities Total liabilities Net assets
(b) Unitholders equity in parent entity
555 265,126 265,681 480 480 265,201
2,447 249,893 252,340 317 317 252,023
Units on issue Capital reserve (ii) accumulated losses Total equity attributable to unitholders of TSO
(c) Parent entitys profit or loss
688,970 (134,482) (289,287) 265,201
688,970 (134,482) (302,465) 252,023
profit/(loss) before income tax income tax expense Profit/(loss) after income tax Other comprehensive income Total comprehensive profit/(loss)
(i) The non-current asset represents the investment in Us reiT at the lower of cost and net realisable value. (ii) The capital reserve is used to record amounts transferred from capital to fund distributions in accordance with TsOs Constitution.
13,398 220 13,178 13,178
(34,541) 241 (34,782) (34,782)
9. Parent entity supplementary information (continued)
The consolidated financial statements include the financial statements of TsO and the subsidiaries listed in the following table:
NAME OF ENTITy COUNTRy OF INCORPORATION % EqUITy HOLDING 2011 2010
Tishman speyer U.s. Office, inc. (Us reiT) Lakeside i mezz L.L.C. Lakeside i at Loudoun Tech, L.L.C. Lakeside ii mezz L.L.C. Lakeside ii at Loudoun Tech, L.L.C. Lakeside iii mezz L.L.C. Lakeside iii at Loudoun Tech, L.L.C. 550 Terry Francois mezz, L.L.C. 550 Terry Francois blvd, L.L.C. Ts Office 407 north maple Jv, L.L.C. Tishman speyer 407 north maple vi, L.L.C. 407 north maple Jv, L.p. 407 north maple gp, L.L.C. 407 north maple, L.p. Ts Office beverly place Jv, L.L.C. Tishman speyer beverly place vi, L.L.C. beverly place Jv, L.p. beverly place gp, L.L.C. beverly place, L.p. Ts Office maple plaza Jv, L.L.C. Tishman speyer maple plaza vi, L.L.C. maple plaza Jv, L.p. maple plaza gp, L.L.C. maple plaza, L.p. 3 imperial promenade, L.L.C.
10. Trade and other payables (current)
United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states United states
100.0 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9
100.0 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9 99.9
Trade creditors amounts payable to related parties interest payable
5,509 13 3,252 8,774
7,760 79 3,972 11,811
Due to the short-term nature of these payables, their carrying value is considered to approximate their fair value.
11. Interest bearing liabilities

MATURITy DATE CONSOLIDATED 2011 2010 A$000 A$000
Interest bearing liabilities held by controlled entities

Current
Us reiT loan facility (a) Deferred financing costs
4 may 2012
369,822 (1,263) 368,559
466,908 (975) 465,933
Non-current
Lakeside Complex first mortgage loan Lakeside i and ii (b) first mortgage loan Lakeside iii (c) beverly hills portfolio first mortgage loan (d) Deferred financing costs
1 Oct 2015 1 mar 2014 1 Jun 2017
39,634 12,976 207,606 (300) 259,916
49,025 16,457 256,799 (452) 321,829
Interest bearing liabilities held by associates TsOs interest in its associates interest bearing liabilities is detailed below:
Non-current
prime plus: first mortgage loan and subordinate mezzanine loan (e) 300 park ave first mortgage loan (f ) Deferred financing costs
8 Jan 2014 8 Jan 2014
378,205 58,474 (2,243) 434,436
473,975 473,975
Terms and conditions relating to the above financial instruments
(a) a facility of Us$391.9 million (30 June 2010: Us$400 million) has been drawn down by Us reiT. The facility is secured by pledges over the equity interests that Us reiT holds in certain subsidiaries and joint ventures. a floating interest rate is payable on the amount drawn and the margin payable is between 4.00% and 6.00% per annum depending on the level of leverage. The effective interest rate on this debt for the year to 30 June 2011 was 8.50%. The facility is subject to the following loan covenants: (i) Us reiT debt to gross asset value (gav) must remain under 85%. at 30 June 2011, Us reiTs debt to gav was 67.42% using the external valuations prepared at 1 april 2011 which are the valuations for the purpose of the Us reiT facility agreement.
11. Interest bearing liabilities (continued) Terms and conditions relating to the above financial instruments (continued)
(ii) Us reiT is required to have a minimum tangible net worth of Us$125 million. Tangible net worth is calculated by subtracting outstanding debt and accrued interest and amortisation from the most recent independently appraised value of the properties. at 30 June 2011, Us reiTs net worth was Us$375 million using the external valuations prepared at 1 april 2011 which are the valuations for the purpose of the Us reiT facility. (iii) Us reiTs debt service coverage ratio (DsCr) must not be less than 1.05:1.00. For the year ended 30 June 2011, TsOs DsCr was 1.19:1.00. (b) a facility for Us$42 million maturing on 1 October 2015 has been put in place to fund the acquisition of two of the three properties comprising the Lakeside Complex. interest only is payable at a fixed rate. The loan is secured by a Deed of Trust against the companies holding the Lakeside i and ii assets and an assignment of all leases and rents in relation to the property. an interest rate of 5.365% calculated on an actual/360 day basis is charged on the amount drawn. Other borrowing costs, primarily the amortisation of debt establishment costs, totalled 0.08% in the year to 30 June 2011. (c) a secured loan with a maturity date of 1 march 2014 was assumed as part of the acquisition of Lakeside iii. This loan was marked to market upon acquisition so that a market interest rate is recorded in the accounts. principal and interest are payable. The effective interest rate on this debt was 5.27% calculated on an actual/360 day basis. (d) a facility of Us$220 million has been put in place to partially fund the acquisition of the beverly hills portfolio of properties. The facility has a maturity date of 1 June 2017. The facility is secured by first mortgages over the properties. interest only is payable at a fixed rate of 5.542% calculated on an actual/360 day basis. Other borrowing costs totalled 0.01%. (e) The prime plus loans are secured by (i) mortgages and deeds of trust encumbering 10 office properties owned by subsidiaries of prime plus; (ii) security interests in fixtures and personal property located on land or the improvements; (iii) assignments of rents and leases; (iv) other customary mortgage loan collateral; and (v) a pledge of prime pluss direct equity interests in the subsidiaries that own the properties provided as security on the first mortgage loan. The release of individual properties (excluding the Chicago properties) from the security arrangements can be obtained by complying with customary defeasance procedures and satisfying certain other customary conditions precedent set out in the mortgage loan documents. The loans have a maturity date of 8 January 2014. interest only was payable until January 2009. principal and interest is payable thereafter with the principal repayment calculated at the amount required to fully amortise the principal over a 30 year period. The effective interest rate on the ppi debt for the year ended 30 June 2011 was 5.88% on an actual/360 day basis. (f ) a facility of Us$135 million (TsOs share: Us$61.965 million) was put in place in august 2010. an amount of Us$8.1 million was paid directly to the lender of the Us reiT facility in order to pay down the principal outstanding on that loan. The proceeds net of the Us reiT facility pay down and closing costs were distributed to TsOs controlled subsidiary Us reiT. The facility is secured by a first mortgage over the property at 300 park avenue. The effective interest rate of this debt for the period to 30 June 2011 was 4.29% per annum. There were no financing facilities available and unused at the reporting date.
12. Preferred stockholders

Preferred stockholders
457
565
in order to comply with U.s. tax rules applying to real estate investment trusts, 484 preference shares at Us$1,000 per share have been issued by each of the reiTs that TsO has a controlling interest in. The preferred stock is not convertible into shares of any other class or series. an annual coupon rate of 15% applies to these shares. The preferred stock has been classified as long-term debt and the amounts paid or payable to the preference shareholders are included in interest expense.
13. Units on issue
CONSOLIDATED 2011 2010 UNITS UNITS
(a) movement in ordinary units on issue (number)
Units on issue at the beginning of the year movements in equity during the year Units on issue at the end of the year
338,440,904 338,440,904 338,440,904 338,440,904

A$000 A$000
(b) movement in ordinary units on issue (amount)
issued equity at the beginning of the year movements in equity during the year Transaction costs Issued equity at the end of the year
677,963 677,963
677,965 (2) 677,963
each unit ranks equally with all other ordinary units for the purpose of distributions and on termination of the Fund. each ordinary unit entitles the holder to one vote, either in person or by proxy, at a meeting of the Fund.
14. Reserves and undistributed income

reserves (a) accumulated losses (b)
(82,657) (330,105) (412,762)
(31,329) (394,611) (425,940)
(a) Foreign currency translation reserve(i)
balance at the beginning of the year Loss on translation of controlled foreign entities attributable to unitholders of TsO Balance at the end of the year
(b) accumulated losses
(31,329) (51,328) (82,657)
(14,466) (16,863) (31,329)
balance at the beginning of the year net profit/(loss) attributable to unitholders of TsO Balance at the end of the year
(394,611) 64,506 (330,105)
(376,692) (17,919) (394,611)
(i) The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign operations.
15. Cash flow statement

Reconciliation of net profit after tax to the net cash flows from operating activities
net operating profit/(loss) attributable to unitholders of TsO (increase)/decrease in receivables and prepayments increase/(decrease) in interest payable (increase)/decrease in deferred financing costs increase/(decrease) in trade creditors and other payables increase in deferred tax liability Decrease in withholding tax payable property expenses paid out of escrow account interest paid out of escrow account Fair value movement in derivatives payments on close out of derivatives Unrealised gain on revaluations Loss on sale of controlled investment properties Cash held in escrow net cash movements in associates Net cash flows used in operating activities
64,506 (739) (294) (354) 144 40,690 377 26,510 (49,723) (56,463) (75,541) (50,887)
(17,919) 635 1,670 1,011 (4,877) 48,237 (247) 121 (2,683) (13,664) 6,869 (57,766) (38,613)
all cash held by TsO is held in bank accounts and earns interest at floating rates based on daily bank deposit rates. all cash held by TsOs U.s. subsidiaries is held in non-interest bearing bank accounts.
16. Capital management
When managing capital, managements objective is to ensure that TsO both continues as a going concern and maintains optimal returns to unitholders. managements policy is that the effective long-term gearing of TsO will normally be in the range of 50% to 55% of total gross assets, with a maximum gearing of 60% of total gross assets. adverse market conditions affecting property valuations have caused TsO to fall outside its target gearing range. The gearing ratios based on continuing operations and taking into account debt held by both the consolidated subsidiaries and the equity accounted associates were 66% at 30 June 2011 and 72% at 30 June 2010. management is assessing the alternatives for reducing gearing and funding ongoing operations. The parent does not carry any third party debt. There were no changes to the board and managements approach to capital management during the year. TsO is not subject to any externally imposed capital requirements.
17. Financial risk management
The principal financial instruments, held by TsO and its subsidiaries and associates, comprise bank and Cmbs loans, cash and shortterm deposits, derivatives and various other financial assets and liabilities such as trade receivables and payables, which arise directly from the operations of TsO and its subsidiaries and associates (TsO group). in accordance with its financial risk management policy, TsO and its subsidiaries enter into derivative transactions from time to time, including interest rate swaps, caps and forward currency contracts, in order to manage the interest rate and currency risks arising from their operations and sources of finance. TsO also monitors the risk management practices of its associates. The main risks arising from the TsO groups financial instruments are interest rate risk, foreign currency risk, credit risk and liquidity risk. The board has overall responsibility for the establishment and oversight of the risk management framework. it fulfils this role with the help of the audit Committee. risk management policies are established to identify and analyse the risks faced by TsO, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. risk management policies and systems are reviewed from time to time to reflect changes in market conditions and TsOs activities. Through its training and management standards and procedures, TsaL aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations towards TsO.
17. Financial risk management (continued) (a) interest rate risk
The consolidated entitys exposures to interest rate risks are as follows: (i) Through its subsidiaries, TsO has an interest in interest bearing liabilities of $628,475,250 (30 June 2010: $787,761,931). Details of the average interest rates applying to this debt are set out in note 11. (ii) Through its equity accounted associates, TsO has an interest in interest bearing liabilities of $434,436,084 (30 June 2010: $473,975,234). Details of the average interest rates applying to this debt are set out in note 11. (iii) Cash and cash equivalents of $20,776,065 (30 June 2010: $28,023,720) with an effective interest rate at 30 June 2011 of 0%. TsOs policy is to manage its finance costs using a mix of fixed and variable rate debt, while maintaining effective medium to longterm fixed interest rates for a substantial portion of its borrowings. TsOs assets are generally funded with first mortgages, with initial terms in excess of five years. at 30 June 2011, 59.8% of the interest bearing liabilities held by TsOs subsidiaries and associates are at fixed rates (30 June 2010: 63.0%). after taking into account interest rate derivatives, at 30 June 2011, 71.5% of the interest bearing liabilities held by TsOs subsidiaries and associates are at fixed rates (30 June 2010: 73.6%). borrowings issued at floating rates expose TsO to cash flow interest rate risk. borrowings issued at fixed rates are carried at amortised cost and expose TsO to fair value interest rate risk. TsO manages its cash flow interest rate risk by holding predominantly fixed rate borrowings and by using interest rate derivatives. TsO generally intends to hold its fixed rate borrowings to maturity. Therefore, fair value interest rate risk should have a minimal impact on the long-term value of TsO. The following sensitivity table is based on the interest rate risk exposures in existence at the balance sheet date. if interest rates had moved, as illustrated in the table below, with all other variables held constant, profit after tax and equity would have been affected as follows:
POST TAX PROFIT HIGHER/(LOWER) 2011 2010 A$000 A$000 EqUITy HIGHER/(LOWER) 2011 2010 A$000 A$000
Consolidated
+1% (100 basis points) 1% (100 basis points)
(2,864) 2,864
(3,995) 3,995
The movements in profit are due to higher/lower interest costs from variable rate debt and cash balances and increases/decreases in the fair value of derivative instruments, which are not deemed to be effective hedges under australian accounting standards.
17. Financial risk management (continued) (b) Foreign currency risk
as TsO invests in the United states, its income statement and balance sheet can be affected significantly by movements in the Us$/a$ exchange rates. in the past, foreign exchange derivatives have been used to create a degree of certainty over the impact of changes in exchange rates on income and capital. TsOs foreign exchange hedging policy was to maintain, on a rolling basis, foreign exchange hedges over a portion of forecast income equating to distributable income of TsO for a period of five years. in the year ended 30 June 2009, management suspended distributions for an indefinite period. Therefore, all foreign exchange contracts have been closed out and no new contracts have been entered into in the current year. as at the balance sheet date, TsO holds no forward foreign currency exchange contracts. TsO does not hold capital hedges. The following sensitivity table is based on the foreign currency risk exposures in existence at the balance sheet date. if the australian dollar had moved, as illustrated in the table below, with all other variables held constant, profit after tax and equity would have been affected as follows:
POST TAX PROFIT HIGHER/(LOWER) 2011 2010 A$000 A$000 EqUITy HIGHER/(LOWER) 2011 2010 A$000 A$000
Consolidated
aUD/UsD +10% aUD/UsD 10%

(c) Credit risk
17 (21)
(152) 186
Credit risk is the risk that counterparties to a financial asset will fail to discharge their obligations, causing TsO to incur a financial loss. Tishman speyer properties, L.p. seeks to minimise TsOs credit risk arising from direct and indirect property investments by sourcing prospective tenants who are considered creditworthy third parties. Where appropriate, third party lease guarantees, cash security deposits and/or letters of credit are sought, and credit checks are performed for prospective tenants. in addition, rent receivable balances are monitored on an ongoing basis with the result that the consolidated entitys exposure to bad debts is not significant. Derivative counterparties and cash transactions are limited to high credit quality financial institutions. The maximum exposure to credit risk is the value of the receivables shown in note 6.
17. Financial risk management (continued) (d) Liquidity risk
Liquidity risk is the risk that TsO will not be able to meet its obligations in relation to investment activities or other operations. TsOs objective is to maintain continuity of funding through committed credit facilities and the implementation of equity raising initiatives at the appropriate time so that it is able to meet its obligations. TsO also reduces its liquidity risk by using long dated debt facilities where possible, staggering debt refinancing requirements over time and not holding financial instruments that significantly increase liquidity risk. The consolidated entitys main exposures to liquidity risk are as follows: (i) Through its subsidiaries, TsO has an interest in interest bearing liabilities of $628,475,250 (30 June 2010: $787,761,931). (ii) Through its equity accounted associates, TsO has an indirect interest in interest bearing liabilities of $434,436,084 (30 June 2010: $473,975,234). (iii) TsO has an interest in the financial liabilities such as trade payables which arise directly from the operations of TsO and its subsidiaries and associates. The contractual maturities of financial liabilities held by TsO and its subsidiary, Us reiT, are as follows:
1 year or less 1 to 5 years Over 5 years
418,921 107,229 218,801 744,951
529,105 86,939 334,821 950,865
The following table sets out the maturity analysis of TsO and its subsidiarys assets and liabilities based on managements expectations.
CONSOLIDATED AS AT 30 JUNE 2011 6 MONTHS OR LESS A$000 612 MONTHS A$000 15 yEARS A$000 OVER 5 yEARS A$000 TOTAL A$000
Financial assets
Cash Trade and other receivables Total financial assets

Financial liabilities
35,897 1,729 37,626
11,186 11,186
47,083 1,729 48,812
Trade and other payables interest bearing liabilities preference shares Total financial liabilities Net maturity
8,774 22,628 31,402 6,224
387,519 387,519 (376,333)
107,229 107,229 (107,229)
218,344 457 218,801 (218,801)
8,774 735,720 457 744,951 (696,139)
Current year interest rates were used in the computation of contractual maturities above.
17. Financial risk management (continued) (d) Liquidity risk (continued)
TsO, along with other guarantors, has agreed to irrevocably and unconditionally guarantee the payment in full of all obligations under a loan facility of Us$391.9 million provided to TsOs subsidiary, Us reiT (refer note 11(a)). TsOs liability is limited to the value of its assets so long as there is no fraud, negligence or wilful default on the part of TsO. Us reiT has provided a guarantee over the loan facility taken out against Lakeside iii (refer note 11(c)). The loan is non-recourse so long as there is no fraud, negligence or event of default.
(e) Net fair values
Unless otherwise stated, the carrying values of the entitys financial assets and liabilities included in the balance sheet approximate their fair values, with the exception of interest bearing loans and borrowings. refer to note 1 for the methods and assumptions adopted in determining net fair values for investments. The fair values of interest bearing loans and borrowings have been calculated using market interest rates. set out below is a comparison of carrying amounts and fair values of interest bearing loans and borrowings.
CARRyING AMOUNT 2011 2010 A$000 A$000 FAIR VALUE 2011 A$000 2010 A$000
Consolidated
interest bearing liabilities: Floating rate facilities Fixed rate facilities
369,822 260,216
466,908 322,282
366,821 246,682
469,607 241,754
18. Related party disclosures
The responsible entity of TsO is TsaL, whose immediate parent entity is Tishman speyer australia LTD, L.L.C. (TsaLL) and whose ultimate parent entity is Tsp. TsaLL and Tsp are incorporated in the United states. The manager of TsOs indirect investments in empire hawkeye and the subsidiaries holding the investments in the Lakeside Complex, and the beverly hills portfolio is Ts manager. The ultimate parent of this entity is Tsp. Details of the fees paid or payable to the responsible entity and Ts manager are disclosed in note 2. The consolidated financial statements are those of the consolidated entity, comprising TsO (the parent entity), Us reiT which TsO controlled from 1 December 2004, the entities holding investments in the properties comprising the Lakeside Complex and the entities holding the investments in the beverly hills properties. refer note 9. Details relating to key management personnel, including remuneration paid, are included in note 19.
The following transactions have taken place with TSP or its controlled entities and related parties during the financial year:
Certain operating costs have been paid by TsaL on behalf of TsO. Over the year ended 30 June 2011, TsaL paid costs of $0.274 million (30 June 2010: $0.272 million) on behalf of TsO. at 30 June 2011, no amount is payable by TsO to TsaL (30 June 2010: $nil). Certain operating costs have been paid by Tsp on behalf of TsO and the investment properties that it has an interest in. TsOs share of those costs for the year ended 30 June 2011 was $0.867 million (30 June 2010: $0.83 million). at 30 June 2011, TsOs share of the amount payable to Tsp was $0.086 million (30 June 2010: $0.164 million). Tsp received property management fees of $8.733 million from investment properties held by TsOs equity accounted investments and $0.975 million from investment properties held by controlled entities for managing the day-to-day operations of the properties. TsOs share of these fees was $4.983 million (30 June 2010: $6.322 million). at 30 June 2011, an amount of $0.905 million was payable in relation to property management fees to Tsp. TsOs share of this payable was $0.484 million (30 June 2010: $0.521 million). Tsp received leasing commissions of $2.761 million from investment properties held by TsOs equity accounted investments and $0.315 million from investment properties held by controlled entities. TsOs share of these fees was $1.583 million (30 June 2010: $2.927 million). at 30 June 2011, an amount of $0.523 million in relation to leasing commissions was payable to Tsp. TsOs share of this payable was $0.242 million (30 June 2010: $0.715 million). Tsp received development fees of $1.349 million from supervising refurbishments at the investment properties held by TsOs equity accounted investments and $0.072 million from investment properties held by controlled entities. TsOs share of these fees was $0.692 million (30 June 2010: $0.747 million). at 30 June 2011, an amount of $0.121 million was payable in relation to development fees to Tsp. TsOs share of this payable was $0.061 million (30 June 2010: $0.204 million). all dealings between TsO and Tsp and its controlled entities and related parties are conducted on normal commercial terms and conditions. no units in TsO are held by the responsible entity or related parties of the responsible entity as at 30 June 2011.
19. Key management personnel disclosures (a) Details of key management personnel
The following key management personnel were in place throughout the year ended 30 June 2011 and up to the date the financial report was authorised for issue. (i) Directors of TSAL graham John Kelly richard michael haddock Jerry irving speyer robert Jeffrey speyer David neil augarten Chairman (non-executive) Director (non-executive) Director (non-executive) Director (non-executive) Director (executive), Chief executive Officer
(ii) Other key management personnel TsaL responsible entity of TsO
(b) remuneration of key management personnel
TsO bears the cost of a portion of the fees payable to the two external directors, graham Kelly and richard haddock. all other key management personnel and employees are paid by TsaL or its related parties. Details of remuneration paid directly by TsO to the key management personnel are set out below:
FEES $ SUPERANNUATION $ TOTAL $
Year ended 30 June 2011
graham John Kelly richard michael haddock
175,000 75,000 250,000
15,199 6,750 21,949
190,199 81,750 271,949
175,000 75,000 250,000
14,461 6,750 21,211
189,461 81,750 271,211
as the responsible entity, TsaL is entitled to receive a base management fee, which is calculated as a percentage of gross assets (refer note 2) and is not determined by reference to specific costs incurred by TsaL. as no other remuneration is paid to key management personnel either directly or indirectly by TsO for services provided to the entity, no further compensation as defined in aasb 124 Related Parties is paid by TsO to key management personnel.
19. Key management personnel disclosures (continued) (c) Units held in TSo by key management personnel
The interests of the directors of TsaL in units of TsO at year end are set out below:
UNITS HELD AT 1 JULy UNITS RECEIVED AS REMUNERATION OTHER NET CHANGES TO UNITS UNITS HELD AT 30 JUNE

500,000 746,100 500,000 746,100
500,000 746,100 500,000 746,100
graham John Kelly richard michael haddock The directors do not hold any options to buy units in TsO.
all equity transactions with key management personnel have been entered into under terms and conditions no more favourable than those that TsO would have adopted if dealing at arms length.
20. Auditors remuneration
CONSOLIDATED 2011 2010 A$ A$
amounts received or due and receivable by ernst & young australia in relation to TsO and its controlled entities for: audit or review of the financial report of TsO taxation advice assurance and compliance services 211,332 8,829 18,316 238,477 amounts received or due and receivable by related practices of ernst & young australia in relation to TsO, its controlled entities and associates for: audit or review of the financial report of TsOs controlled entities and associates taxation advice other services 1,364,570 648,705 51,901 2,065,176 1,987,979 844,579 2,832,558 233,467 72,055 207,277 512,799
21. Earnings per unit

2011 2010
basic and diluted earnings per unit (cents)
19.06
(5.29)
earnings per unit is calculated by dividing the net profit attributable to unitholders for the year by the weighted average number of ordinary units on issue during the year. The following reflects the data used in the calculation of basic and diluted earnings per unit:
A$000 A$000
net profit/(loss) attributable to TsO unitholders
64,506
UNITS
(17,919)
UNITS
Weighted average number of units used in calculating basic and diluted earnings per unit (number) TsO has no dilutive units, therefore its basic and diluted earnings per unit are the same.
22. Net asset backing per unit
338,440,904 338,440,904
CONSOLIDATED 2011 2010 A$ A$
net asset backing per unit
0.78
0.74
net asset backing per unit is calculated by dividing the equity attributable to unitholders of TsO by the number of ordinary units on issue. The following reflects the data used in the calculation of net asset backing per unit:
A$000 A$000
equity attributable to TsO unitholders
265,201
UNITS
252,023
UNITS
Units on issue used in calculating net asset backing (number)
338,440,904 338,440,904
23. Segment information
TsOs income is currently derived from direct and indirect investments in office properties located in the United states and from short-term deposits, money market securities and derivatives which are held for and are incidental to those property investments. except for cash deposits held in australia, all such investments are located in the United states. management measures the performance of TsO by reference to the U.s. dollar equivalent of Funds From Operations (FFO). FFO is calculated as net profit after tax adjusted for fair value movements on investment properties and derivatives, foreign exchange gains/ losses, movements in the promote and deferred tax expense, leasing costs and transaction costs. The reconciliation of FFO in U.s. dollars to net profit/(loss) after tax in australian dollars is as follows:
CONSOLIDATED 2011 2010 $000 $000
net FFO attributable to unitholders of TsO add back: Fair value movement in derivatives associates parent and controlled entities movement in deferred tax provision priority allocation of profit to empire hawkeye co-investor Fair value movement in investment properties associates parent and controlled entities Loss on sale of investment properties parent and controlled entities Leasing costs associates parent and controlled entities Debt restructure costs Defence and restructure costs Net profit/(loss) after tax attributable to unitholders of TSO (US$000) average exchange rate Net profit/(loss) after tax attributable to unitholders of TSO (A$000)
15,905
30,074
(34) (17) (41,080) (26,330) 77,883 50,758 (10,958) (1,101) 65,026 1.01 64,506
900 (106) (42,330) 16,116 12,218 (5,978) (9,916) (866) (10,734) (4,387) (15,009) 0.84 (17,919)
24. Capital expenditure commitments and contingent liabilities
at 30 June 2011, TsOs subsidiaries had contractual obligations to pay $4.186 million (30 June 2010: $2.696 million) towards property building works. The commitments are expected to be settled within 12 months from balance date. Capital commitments of TsOs associates are disclosed in note 8. Unless otherwise disclosed in the financial statements, there are no further material capital expenditure commitments or contingent liabilities.
25. Events occurring after reporting date
There have been no matters or circumstances that have arisen since the end of the financial year that have significantly affected, or may affect, TsOs operations in future financial years, the results of those operations or TsOs state of affairs in future financial years.
DireCTorS DeCLaraTioN
in accordance with a resolution of the directors of Tishman speyer australia Limited, the responsible entity of Tishman speyer Office Fund (the Fund), i state that: 1. in the opinion of the directors: (a) the financial statements and notes of the Fund are in accordance with the Corporations act 2001, including: (i) giving a true and fair view of the Funds financial position as at 30 June 2011 and of its performance for the year ended on that date; and (ii) complying with accounting standards and Corporations regulations 2001; and (b) there are reasonable grounds to believe that the Fund will be able to pay its debts as and when they become due and payable. 2. This declaration has been made after receiving the declarations required to be made to the directors of Tishman speyer australia Limited in accordance with section 295a of the Corporations act 2001 for the financial year ended 30 June 2011. 3. The financial statements and notes also comply with international Financial reporting standards as disclosed in note 1(b). On behalf of the board Tishman speyer australia Limited abn 43 106 909 871
GJ Kelly
Chairman Sydney, 16 August 2011
Auditor's Independence Declaration to the Directors of Tishman Speyer Independent audit report to the unitholders of Tishman Speyer Office Australia Limited as Responsible Entity for Tishman Speyer Office Fund Fund
In relationhave audited of the financial report of Tishman Speyer Office Fund for the Fund,ended 30 June the We to our audit the accompanying financial report of Tishman Speyer Office year which comprises 2008,balance sheet of my30 June 2008, and the income have been statement of changes in equity and cash to the best as at knowledge and belief, there statement, no contraventions of the auditor independence requirements of theended on that date,2001 or anyofapplicable code of professional other flow statement for the year Corporations Act a summary significant accounting policies, conduct. explanatory notes and the directors declaration of the consolidated entity comprising the trust and the entities it controlled at the years end or from time to time during the financial year.
Directors Responsibility for the Financial Report

The directors of Tishman Speyer Australia Limited (The Responsible Entity) are responsible for the preparation and fair presentation of the financial report in accordance with the Australian Accounting Standards Ernst & Young (including the Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. In Note 1, the directors also state that the financial report, comprising the financial statements and notes, complies with International Financial Reporting Standards as issued by the International Accounting Standards Board.
Auditors David Simmonds Responsibility Partner Our responsibility is to express an opinion on the financial report based on our audit. We conducted our Sydney audit in accordance with Australian Auditing Standards. These Auditing Standards require that we Ernst & Young comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement. 21 August 2008
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, we consider internal controls relevant to the entitys preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Independence
In conducting our audit we have met the independence requirements of the Corporations Act 2001. We have given to the directors of the company a written Auditors Independence Declaration, a copy of which is included in the directors report. In addition to our audit of the financial report, we were engaged to undertake the services disclosed in the notes to the financial statements. The provision of these services has not impaired our independence.
LiabilityLiability by a scheme scheme approved limited limited by a approved under Professional Standards Legislation under Professional Standards Legislation
Auditor's Independence Declaration to the Directors of Tishman Speyer Australia Limited as Responsible Entity for Tishman Speyer Office Fund
In relation to our audit of the financial report of Tishman Speyer Office Fund for the year ended 30 June 2008, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.
Ernst & Young
David Simmonds Partner Sydney Ernst & Young 21 August 2008
Liability limited by a scheme approved under Professional Standards Legislation
U.S. DoLLar STaTemeNT oF ComPreheNSive iNCome For The year eNDeD 30 jUNe 2011
CONSOLIDATED 2011 2010 US$000 US$000
Income
share of net income of associates rental income property expenses amortisation of leasing costs and tenant incentives net rental income net borrowing costs managers fees Corporate expenses net income of associates before fair value adjustments net fair value (decrement)/increment on financial derivatives Fair value increment on investment properties share of net income of associates based on 91.82% ownership interest priority allocation of profit to co-investor share of net income of associates attributable to TsO rental income from controlled investment properties Fair value increment on controlled investment properties interest income Total revenue and other income
Expenses
136,883 (54,325) (10,958) 71,600 (26,268) (5,577) (516) 39,239 (34) 77,883 117,088 (26,330) 90,758 35,017 50,758 44 176,577 16,283 48,990 1,579 3,301 17 31 70,201 106,376 218 41,080 65,078 108 65,186 65,026 52 65,129 57 19.21
141,491 (56,945) (9,916) 74,630 (27,987) (5,170) (1,201) 40,272 900 16,116 57,288 57,288 45,616 12,218 24 115,146 18,784 5,978 53,221 1,747 7,481 106 294 87,611 27,535 201 42,330 (14,996) 29 (14,967) (15,009) 13 (14,923) (44) (4.43)
property expenses of controlled investment properties Loss on sale of controlled investment properties borrowing costs managers fees Corporate expenses net fair value decrement on financial derivatives Foreign exchange loss Total expenses Profit before tax expense U.s. withholding tax Deferred tax expense Profit/(loss) after tax expense
Other comprehensive income
Foreign currency translation gain (no tax effect) Total comprehensive profit/(loss)
Net profit/(loss) after tax attributable to:
Unitholders of TsO non-controlling interests

Total comprehensive profit/(loss) attributable to:
Unitholders of TsO non-controlling interests basic and diluted earnings per unit (cents) This U.s. dollar information is presented for information purposes only and has not been audited.
U.S. DoLLar BaLaNCe SheeT aS aT 30 jUNe 2011
Current assets
Cash and cash equivalents restricted cash receivables Other Total current assets
Non-current assets
22,016 27,877 1,003 830 51,726
24,008 1,400 824 26,232
equity accounted investments in associates investment properties Cash (including restricted cash) Other assets non-current interest bearing liabilities Derivative liability Other liabilities share of net assets based on 91.82% ownership interest priority allocation to co-investor Total equity accounted investment in associates attributable to TsO investment properties Total non-current assets Total assets
Current liabilities
1,161,036 63,218 12,170 (460,372) (28) (28,534) 747,490 (26,330) 721,160 355,795 1,076,955 1,128,681
1,069,012 56,420 13,164 (406,054) (27,946) 704,596 704,596 301,290 1,005,886 1,032,118
Trade and other payables interest bearing liabilities Total current liabilities
Non-current liabilities
9,297 390,562 399,859
10,119 399,165 409,284
interest bearing liabilities Deferred tax liability preferred stockholders Total non-current liabilities Total liabilities Net assets
Unitholders equity
275,433 171,785 484 447,702 847,561 281,120 524,769 (881) (242,852) 281,036 84 281,120
275,711 130,705 484 406,900 816,184 215,934 524,769 (984) (307,878) 215,907 27 215,934
Units on issue reserves accumulated losses Total equity attributable to unitholders of TSO non-controlling interests Total equity This U.s. dollar information is presented for information purposes only and has not been audited.
U.S. DoLLar CaSh FLoW STaTemeNT For The year eNDeD 30 jUNe 2011
Cash flows from operating activities
Distribution received from equity accounted associates receipts in the course of operations interest income payments in the course of operations borrowing costs Fees and other expenses paid (inclusive of gsT) Withholding tax paid Cash held in escrow to fund operating activities Net cash flows used in operating activities
Cash flows from investing activities
15,154 34,854 44 (16,321) (23,319) (4,838) (218) (53,374) (48,018)
6,003 47,118 10 (26,435) (51,071) (9,187) (416) (33,978)
payments for purchase of, and additions to, investment properties net proceeds from sale of investment properties Cash held in escrow to fund additions to investment properties Capital paid from/(to) associates Net cash flows from investing activities
Cash flows from financing activities
(3,817) (1,100) 50,943 46,026
(12,554) 160,267 (147,508) 205
equity transaction costs paid net proceeds from interest bearing liabilities Net cash flows from financing activities Net decrease in cash and cash equivalents held Cash and cash equivalents at the beginning of the financial year Cash and cash equivalents at the end of the financial year This U.s. dollar information is presented for information purposes only and has not been audited.
(1,992) 24,008 22,016
(2) 4,500 4,498 (29,275) 53,283 24,008
NoTeS To The U.S. DoLLar iNFormaTioN For The year eNDeD 30 jUNe 2011
1. Basis of preparation
The additional U.s. dollar information has been extracted from the consolidated financial report of TsO for the year ended 30 June 2011 before conversion to australian dollars. australian dollar denominated assets and liabilities have been translated from australian dollars at the rate of exchange current at the balance date. australian dollar denominated income and expenditure have been translated at the exchange rate ruling at the date of the transaction or the average exchange rate for the period.
TSO
2011
ANNuAl REPORT
SuPPlEMENTARY uNITHOldER INfORMATION
SUPPLemeNTary iNFormaTioN
UNiThoLDer aNaLySiS
Range of Unitholders as at 31 August 2011

RANGE SECURITIES NO. OF HOLDERS
1 to 1,000 1,001 to 5,000 5,001 to 10,000 10,001 to 50,000 50,001 to 100,000 100,001 and over Total Unmarketable parcels
Substantial Unitholders as at 31 August 2011
COMPANy
35,743 834,205 1,790,658 8,707,825 5,358,376 321,714,097 338,440,904 13,112
78 247 215 367 71 96 1,074 55
NO. OF UNITS
% OF UNITS ON ISSUE
mireLF iii australia aiv, Lp golden Tree asset management L.p. hayman Capital master Fund, L.p.
88,157,298 36,209,130 17,048,124
26.05 10.70 5.04
SUPPLemeNTary iNFormaTioN
UNiThoLDer aNaLySiS
Top 20 Unitholders at 31 August 2011

RANK UNITHOLDER A/C DESIGNATION NO. OF UNITS % OF UNITS ON ISSUE
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
hsbC Custody nominees (australia) Limited a/C 3 Citicorp nominees pty Limited hsbC Custody nominees (australia) Limited gsCO eCa hsbC Custody nominees (australia) Limited national nominees Limited hsbC Custody nominees (australia) Limited a/C 2 merrill Lynch (australia) nominees pty Limited Jp morgan nominees australia Limited <Cash income a/C> Citicorp nominees pty Limited <Colonial First state inv a/C> Jp morgan nominees australia Limited Credit suisse securities (europe) Ltd <Collateral a/C> horrie pty Ltd mr Claudio paul marcolongo & mrs Diane marcolongo ar management Co pty Limited <ar management a/C> equity Trustees Limited <eQT sgh property inc Fund> abn amrO Clearing sydney nominees pty Ltd <Custodian a/C> mr philip anthony Feitelson greig & harrison pty Ltd Limits pty Limited <Duncan gamble Family a/C> Cogent nominees pty Limited
90,773,214 45,029,715 32,018,472 27,580,288 24,015,489 17,641,601 15,137,387 13,763,057 8,460,472 6,373,454 4,380,000 4,040,000 2,300,000 2,099,343 2,032,643 1,321,098 1,059,000 1,000,000 1,000,000 848,370 300,873,603 37,567,301 338,440,904
26.82% 13.31% 9.46% 8.15% 7.10% 5.21% 4.47% 4.07% 2.50% 1.88% 1.29% 1.19% 0.68% 0.62% 0.60% 0.39% 0.31% 0.30% 0.30% 0.25% 88.90% 11.10% 100.00%
Total Balance of register Grand total
CorPoraTe DireCTory
Responsible Entity of the Fund
Auditor of the Fund
Tishman speyer australia Limited (TsaL) abn 43 106 909 871 aFsL 246917
Registered Office
Level 12 The Chifley Tower 2 Chifley square sydney nsW 2000 Telephone: (02) 9921 3900 Fax: (02) 9921 3999 Website: www.tsof.com.au
Directors of TSAL
ernst & young ernst & young Centre 680 george street sydney nsW 2000 Telephone: (02) 9248 5555 Fax: (02) 9248 5959
Registry
Link market services Limited Level 12 680 george street sydney nsW 2000 Telephone: (02) 8280 7111 Fax: (02) 9287 0303
Investor Enquiries
mr graham J Kelly Chairman and Non-executive Independent Director mr richard m haddock Non-executive Independent Director mr Jerry i speyer Non-executive Director mr robert J speyer Non-executive Director mr David n augarten Chief Executive Officer and Executive Director
Company Secretary
TsO investor information Line 1300 304 109 (australia) or +61 2 8280 7216 (overseas callers)
ms nicole a moodie
precinct.com.au
see it first.sm
Level 12 The Chifley Tower 2 Chifley Square Sydney NSW 2000 P 02.9921.3900 F 02.9921.3999
ARSN 108 809 537 Responsible entity: Tishman Speyer Australia Limited ACN: 106 909 871
All Registry communications to: C/- Link Market Services Limited Locked Bag A14, Sydney South, NSW, 1235 Telephone Enquiry Line (within Australia): 1300 304 109 Telephone Enquiry Line (outside Australia): +61 2 8280 7216 Facsimile: (02) 9287 0303 ASX Code: TSO Email: registrars@linkmarketservices.com.au Website: www.linkmarketservices.com.au
Thursday, 22 September 2011
Dear Unitholder, ANNUAL REPORT FOR YEAR ENDED 30 JUNE 2011 In accordance with changes made under the Corporations Act, unless the Tishman Speyer Office Fund (TSO) Unit Registry has been notified otherwise, you will not be sent a hard copy of the Annual Report. All unitholders can view the Annual Report, which contains the Financial Report for the year ended 30 June 2011 on TSO's website at the following URL: http://www.tishmanspeyer.com.au/irm/content/investor_annualreports.html Should you have any questions about your unitholding, or would like to receive future notices electronically, please contact the TSO Unit Registry on (02) 8280 7111 or registrars@linkmarketservices.com.au
Nicole Moodie Company Secretary Tishman Speyer Australia Limited

Office Fund: Tishman Speyer

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Tishman speyer

lETTER fROM THE cEO

TSo | aNNUaL rePorT | 1

LeTTer From The Ceo

LeTTer From The Ceo

TSo | aNNUaL rePorT | 3

FiNaNCiaL year 2011

520 Pike Tower

330 E. Kilbourne Avenue Milwaukee, WI

Greenwich American Centre

300 Park Avenue

One Bush Street

595 Market Street

400 Castro Street

Beverly Hills Portfolio

227 West Monroe Street, 222 West Adams Street Chicago, IL

Ridgetop Circle, Loudoun County, VA

Lakeside at Loudoun Tech

TSo | aNNUaL rePorT | 5

greenwich, Fairfield County market

San Francisco market

Beverly hills market

TSo | aNNUaL rePorT | 11

Leasing Activity from 1 July 2010 to 30 June 2011

TSo | aNNUaL rePorT | 13

300 PARK AVENUE

1955/1998/2000 45.9% 773,314 square feet 89.9% Us$778.0 million

503,159 104,719 41,233 20,616

65.1 13.5 5.3 2.6

Jun 2023 Oct 2020 aug 2018 Jan 2021

Windels marx globeOp Japanese Tourism board bennett Footwear

58,977 32,084 27,440 27,366

15.9 8.7 7.4 7.4

sep 2017 sep 2017 Dec 2018 may 2013

TSo | aNNUaL rePorT | 15

GREENWICH AMERICAN CENTRE

greenwich, CT 1970/1987 45.9% 650,413 square feet 100% Us$189.4 million

152,715 124,349 101,525 36,440 33,891

23.5 19.1 15.6 5.6 5.2

140,641 88,565 72,986 42,609

13.1 8.2 6.8 4.0

Feb 2014 Jul 2015 Dec 2013 apr 2021

TSo | aNNUaL rePorT | 17

FRANKLIN CENTER 227 WEST MONROE NAME

Chicago, iL 1989 45.9% 1,584,769 square feet 82.3% Us$433.9 million

272,359 229,206 159,596 116,233 71,000

17.2 14.5 10.1 7.3 4.5

FRANKLIN CENTER 222 WEST ADAMS NAME

Chicago, iL 1992 45.9% 930,994 square feet 86.1% Us$227.5 million

William blair & Company gaTx aT Kearney FTi Consulting, inc.

306,191* 124,633 88,297 91,238**

32.9 13.4 9.5 3.7

aug 2017 Oct 2023 aug 2017 Jun 2025

TSo | aNNUaL rePorT | 19

PLAZA NAME EAST I AND II

87,784 59,532** 29,510** 17,432

18.4 12.5 6.2 3.7

nov 2012 Jun 2022 Jan 2013 sep 2015

520 PIKE TOWER NAME

seattle, Wa 1983/2000 45.9% 384,922 square feet 91.1% Us$101.1 million

61,332 26,989 17,686 17,686

15.9 7.0 4.6 4.6

87,784 59,532 29,510 17,432