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Peter Munk, Chairman The past several years have been an exciting time in the REIT industry and an exciting time for Trizec, particularly 2005.
       Working under the backdrop of a recovering economy, REITs outperformed the broader market for the sixth year in a row. At the same time, capital continued to flow into real estate, resulting in an energized yet increasingly competitive environment. Throughout it all, Trizec has remained at the top of its game, helping to set the performance bar at its highest.
       We began 2005 with the strong momentum established over the past few years. Our ambitions drove us to make strategic moves that would solidify Trizec's place in the industry. We reinforced our leadership team, adding talented men and women whose experience, reputation and performance are backed by such personal attributes as integrity, intelligence and humor. Together, Trizec implemented an aggressive, yet disciplined approach through smart deployment of capital, operational excellence and superior leasing practices.
       Working in the best interest of our stockholders, and holding fast to our repositioning strategy, we continued to dispose of properties that no longer met our objectives. We remain focused on attractive markets with strong economies, job growth and market fundamentals. The result is a streamlined portfolio that offers premier locations, outstanding amenities and excellence in customer service.
       Trizec realized many milestones in 2005: We were a net acquirer of office properties for the first time since 1999; we were recognized for our performance in operational and leasing functions with industry awards from NAREIT and other organizations; and our growing financial strength took hold.
       The year ended with our most significant achievement — an agreement to acquire the largest portfolio in our company's recent history, 4.1 million square feet of properties in Southern California from Arden Realty. After putting Trizec on the map with a strong operating platform and sound financials, this acquisition is another testament to the leadership of Tim Callahan and his team, who pursued the opportunity from the start, moved Trizec to the top of the list of many contenders and ultimately prevailed.
       I am proud as I think back to 2002, the year Trizec was launched as a publicly traded U.S. REIT. We set out to create a tax-efficient vehicle to unlock the value of our core assets by focusing on high-quality premier office properties in the nation's most dynamic markets. I am pleased to look at the results we have demonstrated to stockholders today as evidence of our ability to honor that promise.
       Trizec Properties is stronger than ever. Moving forward, we challenge ourselves to continually perform at a superior level that has become the company standard. By strategically allocating capital, providing outstanding management services to our customers and employing the best people in the industry, I am confident we will.
       I look forward to sharing the results that matter with our stockholders and producing the benefits that arrive from increasing cash flow, capital appreciation, rising share price and strong dividends. I welcome the opportunities that will get us there, and take us beyond.
Signature
Peter Munk
Chairman of the Board of Directors