INVESTMENT PROPERTIES (Tables)

12 Months Ended

Dec. 31, 2019

Investment property [abstract]

Disclosure of fair value measurement of assets [text block]

The following table categorizes financial assets and liabilities, which are carried at fair value, based upon the fair value hierarchy levels:

	2019						2018
AS AT DEC. 31 (MILLIONS)	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Financial assets
Other financial assets
Government bonds	$	—	$	2,403	$	—	$	—	$	88	$	—
Corporate bonds	—		2,682		275		—		632		—
Fixed income securities and other	419		851		480		22		369		490
Common shares and warrants	1,966		421		802		1,928		229		222
Loans and notes receivables	—		51		4		—		46		4
Accounts receivable and other	1		1,737		219		44		1,990		79
	$	2,386	$	8,145	$	1,780	$	1,994	$	3,354	$	795
Financial liabilities
Accounts payable and other	$	93	$	3,749	$	686	$	81	$	2,622	$	659
Subsidiary equity obligations	—		40		1,856		—		85		1,640
	$	93	$	3,789	$	2,542	$	81	$	2,707	$	2,299

The following table presents our investment properties measured at fair value:

AS AT DEC. 31 (MILLIONS)	2019		2018
Core office
United States	$	15,748	$	15,237
Canada	4,806		4,245
Australia	2,300		2,391
Europe	2,867		1,331
Brazil	361		329
Core retail	21,561		17,607
LP investments and other
LP investments office	8,756		8,438
LP investments retail	2,812		3,414
Logistics	94		183
Multifamily	2,937		4,151
Triple net lease	4,508		5,067
Self-storage	1,007		931
Student housing	2,605		2,417
Manufactured housing	2,446		2,369
Mixed-Use	2,703		12,086
Directly-held real estate properties	19,814		2,750
Other investment properties	1,361		1,363
	$	96,686	$	84,309

Disclosure of significant unobservable inputs used in fair value measurement of assets [text block]

The following table summarizes the valuation techniques and significant unobservable inputs used in the fair value measurement of Level 3 financial instruments:

(MILLIONS) Type of Asset/Liability	Carrying Value Dec. 31, 2019			Valuation Techniques	Significant Unobservable Inputs	Relationship of Unobservable Inputs to Fair Value
Fixed income securities and other	$	480		Discounted cash flows	•  Future cash flows	•  Increases (decreases) in future cash flows increase (decrease) fair value
					•  Discount rate	•  Increases (decreases) in discount rate decrease (increase) fair value
Corporate bonds	275			Discounted cash flows	•  Future cash flows	•  Increases (decreases) in future cash flows increase (decrease) fair value
					•  Discount rate	•  Increases (decreases) in discount rate decrease (increase) fair value
Common shares (common shares and warrants)	802			Black-Scholes model	•  Volatility	•  Increases (decreases) in volatility increase (decreases) fair value
					•  Term to maturity	•  Increases (decreases) in term to maturity increase (decrease) fair value
Limited-life funds (subsidiary equity obligations)	(1,856		)	Discounted cash flows	•  Future cash flows	•  Increases (decreases) in future cash flows increase (decrease) fair value
					•  Discount rate	•  Increases (decreases) in discount rate decrease (increase) fair value
					•  Terminal capitalization rate	•  Increases (decreases) in terminal capitalization rate decrease (increase) fair value
					•  Investment horizon	•  Increases (decreases) in the investment horizon decrease (increase) fair value
Derivative assets/Derivative liabilities (accounts receivable/payable)	219		/	Discounted cash flows	•  Future cash flows	•  Increases (decreases) in future cash flows increase (decrease) fair value
	(686		)
					•  Discount rate	•  Increases (decreases) in discount rate decrease (increase) fair value

The significant unobservable inputs (Level 3) included in the discounted cash flow models used when determining the fair value of standing timber and agricultural assets include:

Valuation Techniques	Significant Unobservable Inputs	Relationship of Unobservable Inputs to Fair Value	Mitigating Factors
Discounted cash flow analysis	•Future cash flows	•Increases (decreases) in future cash flows increase (decrease) fair value	•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
	•Timber / agricultural prices	•    Increases (decreases) in price increase (decrease) fair value	•    Increases (decreases) in price tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from price
	•Discount rate /terminal capitalization rate	•    Increases (decreases) in discount rate or terminal capitalization rate decrease (increase) fair value	•    Decreases (increases) in discount rates or terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from rates
	•    Exit Date	•    Increases (decreases) in exit date decrease (increase) fair value	•    Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year

The significant Level 3 inputs include:

Valuation Technique	Significant Unobservable Inputs	Relationship of Unobservable Inputs to Fair Value	Mitigating Factors
Discounted cash flow analysis1	•    Future cash flows – primarily driven by net operating income	•    Increases (decreases) in future cash flows increase (decrease) fair value	•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
	•    Discount rate	• Increases (decreases) in discount rate decrease (increase) fair value	•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
	•    Terminal capitalization rate	• Increases (decreases) in terminal capitalization rate decrease (increase) fair value	•    Increases (decreases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from terminal capitalization rates
	•    Investment horizon	•    Increases (decreases) in the investment horizon decrease (increase) fair value	•    Increases (decreases) in the investment horizon tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year

1. Certain investment properties are valued using the direct capitalization method instead of a discounted cash flow model. Under the direct capitalization method, a capitalization rate is applied to estimated current year cash flows.

The following table summarizes the key valuation metrics of the company’s investment properties:

	2019					2018
AS AT DEC. 31	Discount Rate		Terminal Capitalization Rate		Investment Horizon (years)	Discount Rate		Terminal Capitalization Rate		Investment Horizon (years)
Core office
United States	7.0	%	5.6	%	12	6.9	%	5.6	%	12
Canada	5.9	%	5.2	%	10	6.0	%	5.4	%	10
Australia	6.8	%	5.9	%	10	7.0	%	6.2	%	10
Europe	4.6	%	4.1	%	11	n/a		n/a		n/a
Brazil	7.9	%	7.4	%	10	9.6	%	7.7	%	6
Core retail	6.7	%	5.4	%	10	7.1	%	6.0	%	12
LP investments and other
LP investments office	10.0	%	7.3	%	7	10.2	%	7.0	%	6
LP investments retail	8.8	%	7.3	%	10	8.9	%	7.8	%	9
Mixed-use	7.6	%	5.4	%	10	7.8	%	5.4	%	10
Logistics1	5.8	%	n/a		n/a	9.3	%	8.3	%	10
Multifamily1	5.1	%	n/a		n/a	4.8	%	n/a		n/a
Triple net lease1	6.3	%	n/a		n/a	6.3	%	n/a		n/a
Self-storage1	5.6	%	n/a		n/a	5.7	%	n/a		n/a
Student housing1	5.8	%	n/a		n/a	5.6	%	n/a		n/a
Manufactured housing1	5.5	%	n/a		n/a	5.4	%	n/a		n/a
Directly-held real estate properties2	5.2% – 9.2%		6.1	%	19	7.4	%	6.8	%	10
Other investment properties1	8.9	%	n/a		n/a	9.3	%	n/a		n/a

1. Multifamily, triple net lease, self-storage, student housing, manufactured housing and other investment properties are valued using the direct capitalization method. The rates presented as the discount rate represent the overall implied capitalization rate. The terminal capitalization rate and the investment horizon are not applicable.

Key valuation metrics of the company’s utilities, transport, energy, data infrastructure and sustainable resources assets at the end of 2019 and 2018 are summarized below.

	Utilities		Transport		Energy		Data Infrastructure		Sustainable Resources
AS AT DEC. 31	2019	2018	2019	2018	2019	2018	2019	2018	2019	2018
Discount rates	7 – 14%	7 – 14%	9 – 14%	10 – 13%	12 – 15%	12 – 15%	13 – 15%	13 – 15%	5 – 10%	5 – 8%
Terminal capitalization multiples	8x – 21x	8x – 22x	9x – 14x	9x – 14x	10x – 17x	10x – 14x	11x – 17x	10x – 11x	5x – 10x	12x – 23x
Investment horizon / Exit date (years)	10 – 20	10 – 20	10 – 20	10 – 20	5 – 10	10	10 – 11	10	3 – 21	3 – 30

Key valuation metrics of the company’s hydroelectric, wind and solar generating facilities at the end of 2019 and 2018 are summarized below.

	North America		Brazil				Colombia				Europe
AS AT DEC. 31	2019	2018	2019		2018		2019		2018		2019		2018
Discount rate
Contracted	4.6 – 4.9%	4.8 – 5.6%	8.2	%	9.0	%	9.0	%	9.6	%	3.5	%	4.0 – 4.3%
Uncontracted	6.2 – 6.4%	6.4 – 7.2%	9.5	%	10.3	%	10.3	%	10.9	%	5.3	%	5.8 – 6.1%
Terminal capitalization rate1	6.2 – 6.4%	6.1 – 7.1%	n/a		n/a		9.8	%	10.4	%	n/a		n/a
Exit date	2040	2039	2047		2047		2039		2038		2034		2033

1. Terminal capitalization rate applies only to hydroelectric assets in North America and Colombia.

the following significant unobservable inputs as part of our valuation:

Valuation Technique	Significant Unobservable Input(s)	Relationship of Unobservable Input(s) to Fair Value	Mitigating Factor(s)
Discounted cash flow models	•    Future cash flows	•    Increases (decreases) in future cash flows increase (decrease) the recoverable amount	•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in recoverable amounts from cash flows
	•    Discount rate	•    Increases (decreases) in discount rate decrease (increase) the recoverable amount	•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from discount rates
	•    Terminal capitalization rate	•    Increases (decreases) in terminal capitalization rate decrease (increase) the recoverable amount	•    Increases (decreases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from terminal capitalization rates
	•    Exit date	•    Increases (decreases) in the exit date decrease (increase) the recoverable amount	•    Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year

The recoverable amounts used in goodwill impairment testing are calculated using discounted cash flow models based on the following significant unobservable inputs:

Valuation Technique	Significant Unobservable Input(s)	Relationship of Unobservable Input(s) to Fair Value	Mitigating Factor(s)
Discounted cash flow models	•    Future cash flows	•    Increases (decreases) in future cash flows increase (decrease) the recoverable amount	•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in recoverable amounts from cash flows
	•    Discount rate	•    Increases (decreases) in discount rate decrease (increase) the recoverable amount	•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from discount rates
	•    Terminal capitalization rate / multiple	•    Increases (decreases) in terminal capitalization rate/multiple decrease (increase) the recoverable amount	•    Increases (decreases) in terminal capitalization rates/multiple tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from terminal capitalization rates
	•    Exit date / terminal year of cash flows	•    Increases (decreases) in the exit date/terminal year of cash flows decrease (increase) the recoverable amount	•    Increases (decreases) in the exit date/terminal year of cash flows tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year

Disclosure of detailed information about investment property

The following table presents the change in the fair value of the company’s investment properties:

AS AT AND FOR THE YEARS ENDED DEC. 31 (MILLIONS)	2019			2018
Fair value, beginning of year	$	84,309		$	56,870
Additions	11,638			3,069
Acquisitions through business combinations	3,669			33,024
Increase attributable to adoption of accounting standards1	928			—
Dispositions2	(6,029		)	(8,555		)
Fair value changes	1,710			1,610
Foreign currency translation and other	461			(1,709		)
Fair value, end of year3	$	96,686		$	84,309

1. The company’s adoption of IFRS 16 resulted in the recognition of ROU investment properties that were previously off-balance sheet items. Refer to Note 2 for additional information.

2. Includes amounts reclassified to held for sale.

3. As at December 31, 2019, the ending balance includes $88.5 billion of investment properties leased to third parties. Also included in the ending balance is approximately $2.6 billion of ROU investment property balances.