February 2012    

Q4 2011 UPDATE & 
STATE OF THE UNITS:

Get up to speed on the latest news for LEAGUE investments - lots of good news to share from the last quarter.

State of the Units & Property Report: Q4 2011

Greetings Friends,

We hope 2012 has gotten off to a joyous and fulfilling start for you. For all of us at LEAGUE, we're happy to report that we've had a wonderful beginning to the year. It's our pleasure to share all the good news with you. 

Before getting into all the detail, we'd first like to remind you that the next revaluation of IGW REIT units takes place on March 1. We will send out a notice as soon as that process is complete. Right now, the unit value for the Traditional Class IGW REIT stands at $1.050, up from $1.035 in December of 2010. Distributions on all Traditional Units are at 7.5 cents per unit per annum. 

A strong ending to 2011... 

There was plenty of activity in late 2011 that gave us excellent momentum heading into the New Year. Among the highlights, we successfully raised the minimum investment of $1 million for the Tsawwassen Retail Power Centre Limited Partnership and were able to begin distributions on that investment before the year ended. 

The Wesbrooke is another property where we saw significant progress as the year came to a close. Construction work reached some key milestones as the site began to take shape, employment applications started to flood in, and deposits were taken on nearly half of the units - and that was all just from word of mouth because formal marketing efforts are just now getting underway! 

We also enjoyed having a prolific feature about LEAGUE in the December edition of Business Edge News. You can read it here: http://league.ca/images/league-in-the-media/Business-Edge-Dec-2011.pdf.

A great start to 2012... 

This year got off to a momentous start with special events to commemorate the official groundbreaking for our Colwood Capital City Centre project. This included a press conference on January 23 where we were joined by Carol Hamilton, the Mayor of Colwood, and Allan Cahoon, President of Royal Roads University. We also hosted a luncheon that day in collaboration with Westshore's Chamber of Commerce. These events generated a lot of media interest. Here are links to some of the coverage we invite you to peruse: 

• AM650 - Capital City Centre Development Radio Interview 
• CTV News TV - Capital Region Now has Two Mega Developments 
• CondosVictoriaBC - Vancouver Island's Largest Condo Development 
• CFAX1070.com - Frank Stanford's comment 
• CFAX1070.com - Downtown Colwood development finally underway 
• OakBayNews.com - Overhaul begins at Colwood Corners 
• CHEK News TV - Colwood Development Breaks Ground 
• CTV News TV - Vancouver Island's Largest Development Breaks Ground 

At this point, as we describe in a separate article in this edition of Legacy, since the groundbreaking, there has been a lot of interest in the Colwood 11% Secured Promissory Notes but we still do have some available. Please talk with your Member Services Manager if you are interested in this investment opportunity. 

On January 18, Partners REIT announced three important events:  

1. The REIT announced a $20 million equity bought deal that closed on February 8, 2012. 
2. The REIT announced the court approval of the REIT's acquisition of assets of Norrock Realty Finance Corporation, which closed on February 1, 2012. 
3. The REIT announced acquisition of five properties in Ontario and one property in Alberta. The properties are: 

• Crossing Bridge Square, a 45,800 square-foot open-air centre located in Stittsville, Ontario, just outside Ottawa 
• Grand Bend Towne Centre, a 36,100 square-foot retail centre on the shores of Lake Huron 
• King George Square, a 67,100 square-foot open-air centre comprised of three buildings on a major thoroughfare in Brantford 
• Manning Crossing, a 64,500-square-foot centre in Edmonton 
• St. Clair Beach Towne Centre, a 40,100-square foot centre comprised of two buildings located in the Windsor, Ontario suburb of Tecumseh 
• Thunder Centre, a 168,000-square-foot power centre in Thunder Bay 

All of the properties except Grand Bend, closed on February 16, 2012. Grand Bend is expected to close at a later date.

As of February 1, 2012, IGW REIT LP, through its subsidiary, IGW PUBLIC LP, owns approximately 21% of Partners REIT. 

Special Events in February... 

This month, we were honoured to take part in two very special occasions - one in Victoria and one in Toronto. On February 7, we participated in a prestigious Vancouver Board of Trade forum looking at values and ethics in the business world. "Doing the right thing" is what we at LEAGUE do all day, every day, so it was a perfect fit for us to share our views, and it was a distinct honour and privilege to share the stage with award-winning author and recipient of the Nobel Peace Prize on behalf of Doctors Without Borders, Dr. James Orbinski, along with some other esteemed panellists. 

We also spent some valuable time in Toronto, at our Summit Series, with a thoughtful and candid "Discussion about Growth" at the Fairmont Royal York Hotel on February 9. Brad Simpson offered a great keynote address and their was a stimulating panel discussion with Adam Gant and three other brilliant entrepreneurs. 

To top it all off, we had a live Webinar on Valentine's Day, focusing on how RRSPs "love" LEAGUE's IGW REIT. It's very timely as the February 29 RRSP deadline is just around the corner. We'll be providing a lot of important information about the RRSP-eligible IGW REIT. 

As for the rest of 2012, we're looking forward to many more special events. We'll let you know as those plans take shape. 

In closing... 

These are exhilarating times for all of us at LEAGUE, as we tend to so many exceptional projects and investments at varying stages in their development and maturity. We look forward with great anticipation to the remainder of 2012 and beyond, as the coming months and years will be filled with outstanding opportunities for our Member Partners. 

What follows is a property-by-property update on the state of every property we manage on your behalf. As always, our Member Services Managers are ready to answer your questions and assist you in any way they can. Just call 1.877.772.8836 or click here to have LEAGUE contact you.     

State of the Units & Property Report Q4 2011

Part A: IGW REIT Properties

Arbutus Industrial Park -- Parksville, BC 

• In accordance with our strategy to replace smaller properties with one property that's larger and easier to manage, this property is listed for sale, and we will consider acceptable offers. 

Vinet's Village Shopping Centre -- Vegreville, AB 

• The centre is 92% leased. Leasing activity to fill the remaining space continues. 
• In accordance with our strategy to replace smaller properties with one property that's larger and easier to manage, this property is listed for sale, and we will consider acceptable offers.

Sobey's Centre (formerly Camrose IGA Garden Market) -- Camrose, AB 

• While plans and permits remain in place for constructing 10,000 additional sq. ft. of commercial/retail space, we are also considering severing the freestanding pad site and selling it off. 

The Lindholm Building -- Victoria, BC 

• Leasing activities continue. 

Merivale Business Park -- Ottawa, ON 

• Leasing activities continue. 
• The facade upgrade is slated to begin this spring. 

Market Square -- Fort Saskatchewan, AB 

• Planning has begun for constructing an additional 6,000 sq. ft. pad for new retail space. A construction schedule will be determined once we have sufficient pre-leasing in place. 
• Leasing activities continue. 

Westlock Shopping Centre -- Westlock, AB 

• Negotiation is underway to amend Bargain Shop's lease so space can be freed for the construction of new storefronts, which will be attractive to customers. This plan has been approved by the City and a development permit granted. Our preference is to sell the property at an appropriate price. It is currently listed for sale. 

Fort Saskatchewan Industrial Park -- Fort Saskatchewan, AB 

• Property sold. 

Londondale Shopping Centre -- Edmonton, AB 

• Re-merchandising and renovations are complete and the centre is now 100% leased. 

Tiffany Suites -- Victoria, BC 

• Suites continue to be upgraded as per our original plan. 
• In accordance with our strategy to replace smaller properties with one property that's larger and easier to manage, this property is listed for sale, and we will consider acceptable offers. 

Stettler Town Mall -- Stettler, AB 

• The mall's remaining vacant space is being marketed for lease. 
• In accordance with our strategy to replace smaller properties with one property that's larger and easier to manage, this property is listed for sale, and we will consider acceptable offers. 

Seaway Village -- Cornwall, ON 

• In accordance with our strategy to replace smaller properties with one property that's larger and easier to manage, this property is listed for sale, and we will consider acceptable offers. 

Carlton Court -- Prince Albert, SK 

• Leasing activities continue for the one small space remaining. 

Dodson Plaza -- Drayton Valley, AB 

• We're reviewing the opportunity to add new commercial pads to attract more profitable tenants. These would replace the existing gas bar. 
• Rexall Drugs is finalizing their expansion to double their space. 

Westwinds Shopping Centre -- Taber, AB 

• The centre is 100% leased. 
• We have begun to pre-lease space for our planned 14,000 sq. ft. expansion. 

Tyee Plaza - Campbell River, BC 

• Leasing activities continue on in-line vacancies and finding tenants to replace the Loblaw store. 

473 Albert Office Tower -- Ottawa, ON 

• BOMA (http://www.boma.org) has approved this building's "Go Green" environmental certification.
• We accepted an Offer to Lease from the federal government for the entire 8th floor and renovations have begun. Other leasing negotiations with the federal government continue. 

Partners REIT (TSX-V: PAR.UN) 

• IGW REIT, through a subsidiary, owns approximately 21% of Partners REIT. 
• For more information on Partners REIT, visit: www.partnersreit.com.

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New IGW Diversified Redevelopment Fund engineered for growth

Stock and bond market investors have suffered through some wild ups and downs in recent months -- just as they've had to many times before and will many times again. 

That's something LEAGUE's Member Partners don't have to worry about. 

When their money goes into a LEAGUE investment, they know they can expect consistent, positive, tax-efficient returns, with minimal volatility and carefully considered risk management.  

A great example is LEAGUE's new IGW Diversified Redevelopment Fund. 

Real diversification 

Diversification is widely accepted as an important investing strategy to reduce risk. In this case, the fund provides an exceptional opportunity to invest in a diverse array of redevelopment projects. This includes retail and industrial properties, as well as office and residential buildings, with these assets located in cities large and small. 

Over the next 12-18 months, LEAGUE expects to invest in four to six such properties, representing a total of $25M. Member Partners participating in the fund will begin earning a return of 6.6%¹ the month they invest. The minimum initial investment for "accredited investors" and investors purchasing Units pursuant to the "offering memorandum exemption" is $1,000.² 

The objective of the fund's property portfolio is to create value "the LEAGUE way" -- which is not by simply tracking the broad real estate market. It is through the expertise and hard work of talented people who know how to skillfully execute redevelopment and refurbishment projects and actively manage properties. 

The Fund's first two properties 

Two properties have already been selected to launch the fund -- The Plaza Hotel in Victoria and 50/52 Arrow Road in Toronto. 

The Plaza Hotel sits in the heart of downtown Victoria at the intersection of Government and Pandora streets, across from the Mountain Equipment Co-op, Chinatown and Centennial Plaza. 

The hotel will be carefully restored to its historical past, and a new structure built and attached to it. 

The end result will be almost 9,000 square-feet of new retail space and underground parking. Plus, there will be four work/live units for professionals, 30 apartments of affordable housing, and some 70 condominiums. In addition, the present driveway will be converted into an outdoor café with special features that will include a water-pond and attractive landscaping. In short, it will become a landmark property in central Victoria. 

Construction work is slated to be completed by January of 2014. 

The 50/52 Arrow Road property in Toronto is currently vacant. It consists of a 56,409-square-foot industrial building where furniture used to be manufactured in the rear and sold in a showroom at the front. 

Though it's sitting empty at the moment, the building has exceptional potential. It's located in a mature industrial zone that has been greatly improved recently after Arrow Road was widened to four lanes, and a new sidewalk and related infrastructure improvements made. There is excellent road access to the property and it is located just a block from a major highway. 

The plan is to convert the building into multiple units, each consisting of 4,500-13,000 square feet of leasable space. After construction work is done, marketing efforts will stress how the transformed property will be ideal for a home improvement centre or retail showroom, with excellent storage and manufacturing configurations available.

The project is already moving forward as preliminary cost estimates have recently been obtained. 

A thoughtful investment strategy 

A good property does not automatically mean a good investment. The Arrow Road and the Plaza Hotel properties were both carefully selected based on a thoughtful strategy. It involved the combination of a frugal purchase discipline, a seasoned redevelopment and refurbishment process, and a predetermined exit strategy. 

For more information about this investment opportunity, please call a LEAGUE Member Services Manager, who will be happy to assist you. 

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DISCLAIMERS:  

¹ Based on the variable yield of a 5 year Government of Canada Bond, plus 5%, cumulative non-compounded simple return. 

² INVESTOR ELIGIBILITY Units of the Funds are offered to investors resident in the provinces and territories of Canada,(the "Offering Jurisdictions") pursuant to applicable exemptions from the prospectus requirements of the securities laws in the Offering Jurisdictions. Subscriptions will be accepted from an investor who is purchasing Units with a minimum investment of $150,000, or an investor who is an "accredited investor" as described in applicable securities legislation, or an investor outside of Ontario and Quebec who is purchasing Units pursuant to the "offering memorandum exemption" as described in applicable securities legislation. The minimum initial investment for "accredited investors" and investors purchasing Units pursuant to the "offering memorandum exemption" is $1,000. 

This document is for information purposes only and is not an offer to sell or a solicitation of an offer to purchase securities. Any offering will be made by way of offering memorandum or, in Ontario and Quebec, will be made only to accredited investors or those investing more than $150,000. 

There are risks associated with this investment. These risks are discussed in the offering memorandum and subscription agreement. You are encouraged to read the offering memorandum (available upon request) and the subscription agreement before making your investment decision.

Secured Promissory Notes at 11%, and great incentive for a down payment too!

Now that the Capital City Centre project is moving full-steam ahead - following our successful launch on January 23 (see our Newsroom for details) - now is the time to think about how you can invest in this outstanding property. 

There are two ways to do that. The first is through Promissory Notes. At this point, there are still some Notes remaining, so please talk with your Member Services Manager if you are interested in this investment opportunity. These notes are offered at 11% per annum, paid monthly over a three-year term or less. These notes will be eligible for RRSPs and other registered plans in the very near future. 

Condo down payment ... plus a 10% "bump" 

The second way to make money comes at the conclusion of the notes' investment term, when you can use the proceeds as a down payment on the purchase of a condominium suite in the development's first phase. Best of all, if you choose to do this, you will also receive an additional 10% "bump"¹ to go towards the purchase of your new apartment.² You can then use the condo as your own residence, or maintain it as an investment property. 

Of course, you can also purchase a condo independent of the Notes. Explore the website capitalcitycentre.ca and talk to your Member Services Manager at 1.877.772.8836 about this beautiful place to live or invest in. Or click here to have LEAGUE contact you. 

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DISCLAIMERS:  

¹ On an initial investment of $100,000, you would receive an additional $10,000. 

² Cannot exceed more than 10% of condominium purchase price. 

This document is for information purposes only and is not an offer to sell or a solicitation of an offer to purchase securities. Any offering will be made by way of offering memorandum or, in Ontario and Quebec, will be made only to accredited investors or those investing more than $150,000. 

There are risks associated with this investment. These risks are discussed in the offering memorandum and subscription agreement. You are encouraged to read the offering memorandum (available upon request) and the subscription agreement before making your investment decision.

You are cordially invited to the LEAGUE Summit Series in Calgary -- a brand new business panel and lecture series taking place across Canada. The event will bring together leading entrepreneurs, investors and student entrepreneurs for an evening of learning and connecting, with updates on unique new private equity funds. We will have a very informative panel of leading entrepreneurs sharing their stories of how they built and grew their companies. We will also have a short presentation on private capital markets and opportunities for investing in entrepreneurs. Come join us for some wonderful company, great food, new connections and some fun.  

Date: Tuesday, March 6, 2012 

Time: 6:00pm 

Location: The Fairmont Palliser -- 133-9^th Avenue S.W., Calgary, Alberta 

To learn more about this event and to register today, please click the invite below:

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DISCLAIMERS:  

This document is for information purposes only and is not an offer to sell or a solicitation of an offer to purchase securities. Any offering will be made by way of offering memorandum or, in Ontario and Quebec, will be made only to accredited investors or those investing more than $150,000.  

There are risks associated with this investment. These risks are discussed in the offering memorandum and subscription agreement. You are encouraged to read the offering memorandum (available upon request) and the subscription agreement before making your investment decision.