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Timothy H. Callahan, President and CEO TO OUR STOCKHOLDERS, EMPLOYEES AND CUSTOMERS:
In the famous Broadway musical “Rent,” the playwright asks “In 525,600 minutes—how do you measure a year in the life?” This query resonates with Trizec Properties as we reflect back on the 525,600 minutes of 2005. Our efforts encompassed all of the fundamentals of running a business, from strategic planning to program execution. Yet, this year we went beyond fundamentals and achieved beyond our expectations.
       Leading up to 2005, our management took significant measures to position Trizec for future opportunities. We disposed of properties in non-core cities and exited markets that no longer met our portfolio strategy. We enhanced our leadership team with key executive appointments and strengthened our management structure to sharpen our focus on operational and leasing initiatives. We were deliberate in our actions and disciplined in our approach. Ultimately, the decisions we made enabled us to capitalize on existing opportunities and to pursue new endeavors.
       By the end of 2005, Trizec delivered a total return of 25.9 percent to stockholders, resulting in a three-year return of 185.1 percent. This compares to a 12.1 percent return for the MSCI US REIT Index and a 4.9 percent return for the S&P 500 Index during 2005. Even though we are pleased with the results for stockholders, we recognize that the results are only as sound as the strategy behind them.
Comparative Total Returns
Trizec Comparative Returns for one year Trizec Comparative Returns for three years

(1) Share price appreciation plus dividend reinvestment for the periods ended December 31, 2005

       That strategy included the sale of five assets for $445 million totaling 2.3 million square feet. We also exited two non-core markets—St. Louis, Missouri, and shortly after year end, Tulsa, Oklahoma. Our 2005 dispositions resulted in a book gain of $135 million with negligible tax implications. By maintaining flexibility in our disposition strategy, we were able to obtain optimum pricing and sell several assets earlier than expected.
       With significant liquidity working in our favor, we continued to expand in core markets, purchasing three premier assets totaling 1.6 million square feet for $625 million—our highest volume of acquisitions since 1999.
       Coming on the heels of such 2004 acquisitions as Bank of America Plaza in Los Angeles and 2001 M Street, N.W., in Washington, D.C., we fortified our growth strategy with the purchase of three Class A properties, including 1200 K Street, N.W. (389,000 square feet) and the Victor Building (343,000 square feet) in Washington, D.C., and Figueroa at Wilshire (1,039,000 square feet) in Los Angeles.
       Our acquisition of the Victor Building, purchased in partnership with Principal Real Estate Investors, highlights our broadened use of the joint venture model. Moving forward, we will continue to leverage our capital and operating platform by fostering relationships with high-quality institutional partners.