IFRS forecast methodology for Direct-Hold Solution vehicles

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## Equity compensation, related parties, and flow-through taxation

Where a forecast models limited partnership units issued to a manager-affiliated party in exchange for services rather than cash, the transaction is accounted for under IFRS 2 *Share-based Payment*: the units are measured at fair value on the date of issuance, expensed within operating profit over the period the services are rendered, and offset by a corresponding increase in an equity reserve — a presentation change within equity with no effect on total equity. Because the general partner and the manager are related parties to the limited partnership, the forecast's notes disclose the advisory and management arrangements between them as related-party transactions conducted on terms set by the limited partnership agreement, consistent with the fee structure described in [[principal-alignment-fee-preservation|Principal Alignment and Fee Preservation]]. Because the partnership is a flow-through entity for tax purposes, it recognizes no current or deferred income tax expense at the partnership level; income and loss are allocated to, and taxed in the hands of, the partners.
Where a forecast models limited partnership units issued to a manager-affiliated party in exchange for services rather than cash, the transaction is accounted for under IFRS 2 *Share-based Payment*. The units are measured at fair value on the date of issuance, expensed within operating profit over the period the services are rendered, and offset by a corresponding increase in an equity reserve — a presentation change within equity with no effect on total equity. Because the general partner and the manager are related parties to the limited partnership, the forecast's notes disclose the advisory and management arrangements between them as related-party transactions conducted on terms set by the limited partnership agreement, consistent with the fee structure described in [[principal-alignment-fee-preservation|Principal Alignment and Fee Preservation]]. Because the partnership is a flow-through entity for tax purposes, it recognizes no current or deferred income tax expense at the partnership level; income and loss are allocated to, and taxed in the hands of, the partners.

## Supplementary metrics, financing mechanics, and the FOFI disclosure discipline

Alongside the IFRS-styled primary statements, the supplementary schedule presents net asset value (NAV) per unit — fair value of equity divided by units outstanding — next to an indicative secondary-market value per unit; both are non-IFRS, management-defined measures that do not substitute for any IFRS subtotal, in the sense described in [[non-ifrs-measures-explained|Non-IFRS Measures Explained]]. Interest coverage and loan-to-value — the latter computed as long-term debenture debt divided by the fair value, not the cost, of investment property — are recalculated for every forecast year as debentures are drawn to fund development and later partially repaid, and funds from operations, defined in [[cre-financial-metrics|Commercial Real Estate Financial Metrics]], is presented as the cash-basis counterpart to IFRS net income, which the forecast's net income figure does not track directly because it includes non-cash fair-value remeasurement effects.
Alongside the IFRS-styled primary statements, the supplementary schedule presents net asset value (NAV) per unit — fair value of equity divided by units outstanding — next to an indicative secondary-market value per unit; both are non-IFRS, management-defined measures that do not substitute for any IFRS subtotal, in the sense described in [[non-ifrs-measures-explained|Non-IFRS Measures Explained]]. Interest coverage and loan-to-value — the latter computed as long-term debenture debt divided by the fair value, not the cost, of investment property — are recalculated for every forecast year as debentures are drawn to fund development and later partially repaid. Funds from operations, defined in [[cre-financial-metrics|Commercial Real Estate Financial Metrics]], is presented as the cash-basis counterpart to IFRS net income, which the forecast's net income figure does not track directly because it includes non-cash fair-value remeasurement effects.

The development-phase financing itself — a first secured mortgage debenture — is modeled at amortised cost using the effective-interest method: a facility cost is netted against the carrying amount and amortised into finance cost over the debenture's term, so the effective borrowing rate the forecast shows exceeds the coupon on its face. Distributions are reconciled to distributable income, not IFRS net income, by excluding non-cash fair-value remeasurement gains that are not available to distribute; a forecast of this kind targets distributions of not less than 90% of distributable income until aggregate distributions equal 100% of contributed capital, after which remaining amounts are modeled as applied first to debenture redemption. The forecast's notes also describe how ISSB climate-related disclosure — IFRS S1 and IFRS S2 — informs the site-selection, design, and capitalisation-rate assumptions feeding the model, ahead of any requirement to apply those standards formally.