Brookfield Office Properties Inc T.BPO.PR.A

RE:RE:RE:If you want "Permanent Capital", capital you don't need

[Carena]

Hi again,

I come from a school where, ultimately, all capital has a carry charge and all capital has to be paid back.  Calling it perpetual capital or perpetual debt is semantics.  I am simply trying to explain to you why I think Brookfield calls it such.  I am long BPO prefs, so I need to have my conviction and I never bet against Bruce Flatt.

In terms of preferred dividends, it is a promise to pay quarterly payouts, and it is not dramatically different than a company who pays a regular quarterly dividend.  On the other hand, an interest payment is a contractual promise with legal consequences. 

Perhaps the BPY guarantee changes the form of the BPO preferred dividends.  Not sure.  Hopefully that never has to get tested.  Nonetheless, my view of the BPY financials are that they are very weak with just $8 billion of "Brookfield" equity and I think we are all looking to Brookfield to keep BPY afloat. Hence, the whole permanent capital concept, including the billions in preferred shares layered in BPY's books.

In regards to the dividend, I only take a sigh of relief when I see the formal company press release of the BPY dividends after the board has approved the financials etc.  I think the TSX is on program with the BPO pref dividends because of the BPY guarantee/BPO's financial disclosure exemptions.

Crazy, you are making me work here! Lol.

Have a good day,
Carena