XML 68 R11.htm IDEA: XBRL DOCUMENT v3.25.0.1
INVESTMENT PROPERTIES
 12 Months Ended
Dec. 31, 2024
Disclosure of detailed information about investment property [abstract]  
INVESTMENT PROPERTIES
4.
INVESTMENT PROPERTIES
As at December 31,
20242023
Income-producing properties$9,297,137 $8,641,352 
Development properties(1)
100,149 166,787 
$9,397,286 $8,808,139 
(1) Development properties include properties under development and land held for development.

Changes in investment properties are shown in the following table:

Years ended December 31,
20242023
Income-producing properties
Development properties(1)
Income-producing properties
Development properties(1)
Balance, beginning of year
$8,641,352 $166,787 $8,486,105 $353,466 
Maintenance or improvements15,381 — 8,409 — 
Leasing costs8,218 — 5,095 1,577 
Tenant allowances8,675 — 6,969 47 
Developments or expansions22,979 4,448 36,633 62,619 
Acquisitions (note 3)
— — 107,125 — 
Transfer to income-producing properties72,701 (72,701)288,979 (288,979)
Amortization of straight-line rent11,843 — 16,690 — 
Amortization of tenant allowances(54)— (4,403)— 
Other changes85 (51)132 10 
Fair value gains (losses), net
53,037 — (216,191)39,888 
Foreign currency translation, net462,920 1,666 (94,191)(1,841)
Balance, end of year
$9,297,137 $100,149 $8,641,352 $166,787 
(1) Development properties include properties under development and land held for development.
The Trust determines the fair value of an income-producing property based upon, among other things, rental income from current leases and assumptions about rental income from future leases reflecting market conditions and lease renewals at the applicable balance sheet dates, less future cash outflows in respect of such leases. Fair values were primarily determined by using a 10-year cash flow and subsequent reversionary value discounted back to present value. The fair values of properties under development are measured using a discounted cash flow model, net of costs to complete, as of the balance sheet date. The valuation metrics utilized to derive the Trust’s investment property valuations are determined by management. The Trust does not value its investment properties based on models prepared by external appraisers but uses such external appraisals as data points, alongside other external market information for management to arrive at its own conclusions on values. Management receives valuation assumptions from external appraisers such as discount rates, terminal capitalization rates and market rental rates, however, the Trust also considers its knowledge of historical renewal experiences with its tenants, its understanding of certain specialized aspects of the Trust’s portfolio and tenant profile, and its knowledge of the current condition of the properties to determine proprietary market leasing assumptions, including lease renewal probabilities, renewal rents and capital expenditures. There has been no change in the valuation methodology during the year.
Included in investment properties as at December 31, 2024 is $81.3 million (2023 — $64.0 million) of net straight-line rent receivables arising from the recognition of rental revenue on a straight-line basis over the lease term.
Details about contractual obligations to purchase, construct and develop properties can be found in the commitments and contingencies note (note 19).
Tenant minimum rental commitments payable to Granite on non-cancellable operating leases as at December 31, 2024 are as follows:

2025
$487,787 
2026
474,152 
2027
444,116 
2028
394,020 
2029
304,846 
2030 and thereafter
1,202,855 
$3,307,776 
Valuations are most sensitive to changes in discount rates and terminal capitalization rates. The key valuation metrics for income-producing properties by country are set out below:

As at December 31,
2024
2023
Weighted
average(1)
MaximumMinimum
Weighted
average(1)
MaximumMinimum
Canada
Discount rate6.59 %7.50 %6.00 %6.55 %7.50 %6.00 %
Terminal capitalization rate5.45 %6.50 %4.75 %5.39 %6.50 %4.75 %
United States
Discount rate7.15 %10.50 %6.40 %7.08 %10.50 %6.15 %
Terminal capitalization rate6.06 %9.25 %5.50 %6.02 %9.25 %5.25 %
Germany
Discount rate7.20 %9.65 %5.85 %7.13 %9.65 %5.80 %
Terminal capitalization rate6.18 %8.90 %4.85 %6.13 %8.90 %4.85 %
Austria
Discount rate8.68 %9.90 %8.15 %8.68 %9.90 %8.15 %
Terminal capitalization rate7.40 %8.25 %6.75 %7.40 %8.25 %6.75 %
Netherlands
Discount rate6.48 %7.95 %5.75 %6.34 %7.75 %5.60 %
Terminal capitalization rate6.68 %9.40 %5.95 %6.57 %9.00 %5.95 %
Total
Discount rate7.11 %10.50 %5.75 %7.05 %10.50 %5.60 %
Terminal capitalization rate6.11 %9.40 %4.75 %6.07 %9.25 %4.75 %
(1)Weighted based on income-producing property fair value.
The table below summarizes the sensitivity of the fair value of income-producing properties to changes in either the discount rate or terminal capitalization rate:

Discount Rate
Terminal Capitalization Rate
Rate sensitivity
Fair value
Change in fair value
Fair value
Change in fair value
+50 basis points$8,955,433 $(341,704)$8,867,084 $(430,053)
+25 basis points9,124,264 (172,873)9,073,316 (223,821)
Base rate
9,297,137 — 9,297,137 — 
-25 basis points9,474,163 177,026 9,540,953 243,816 
-50 basis points$9,655,453 $358,316 $9,807,644 $510,507