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No securities regulatory authority has expressed an opinion about these securities and it is an offence to claim otherwise. This prospectus constitutes a public offering of these securities only in those jurisdictions where they may be lawfully offered for sale and only by persons permitted to sell these securities. These securities have not been and will not be registered under the United States Securities Act of 1933, as amended, and, subject to certain exemptions, will not be offered or sold within the United States or to U.S. persons.
PROSPECTUS New Issue February 28, 2011
$100,000,011.54 (8,183,307 Units) Maximum $12.22 per Class A Unit $12.21 per Class B UnitTimbercreek Global Real Estate Fund (the Fund) is a non-redeemable investment fund governed by the laws of the Province of Ontario. This prospectus qualifies for distribution up to 8,183,307 Class A Units and/or Class B Units (collectively, the Units) of the Fund at a price of $12.22 per Class A Unit and $12.21 per Class B Unit (the Offerings). Class B Units are designed for fee-based accounts with a registered dealer and/or institutional accounts and will not be listed on a stock exchange, but are convertible into Class A Units on a weekly basis. The issued and outstanding Class A Units of the Fund are listed and posted for trading on the Toronto Stock Exchange (the TSX) under the symbol TGF.UN. The TSX has conditionally approved the listing of the Class A Units to be distributed under this prospectus. Listing is subject to the Fund fulfilling all the requirements of the TSX on or before May 4, 2011. On February 25, 2011, the closing price on the TSX of the Class A Units was $11.94, the net asset value of a Class A Unit was $11.5594 and the net asset value of a Class B Unit was $11.9577. Investment Objectives The Funds investment objectives are to: (i) (ii) provide holders of Units (Unitholders) with quarterly distributions; and preserve capital while providing the opportunity for long-term capital appreciation for Unitholders;
by investing in a diversified portfolio of premier real estate securities including common equity, preferred shares and debt of both public and private real estate investment trusts and real estate companies in Canada, United States, United Kingdom, Continental Europe, Japan, Australia, Hong Kong and other countries. See Investment Objectives. Investment Strategies Managed by Timbercreek Asset Management Ltd. (the Manager), the Fund will invest in a globally diversified portfolio (the Portfolio) of premier real estate securities including common equity, preferred shares and debt of both public and private real estate investment trusts and real estate companies in Canada, United States, United Kingdom, Continental Europe, Japan, Australia, Hong Kong and other countries. The Manager believes that
the global real estate securities market is inefficient relative to that of the direct real estate or broader equities markets. Managed by a specialized real estate manager, the Funds investment strategy has been designed to capitalize on these pricing inefficiencies in order to deliver a stable income stream acquired at a price that the Manager believes does not reflect the long-term value of the underlying assets. Furthermore, FSX Securities Canada Inc. (the Global Investment Advisor) believes that current pricing in global equity markets provides the Fund with the opportunity to assemble a global portfolio of prime real estate securities at prices that generate attractive, stable yields with the potential for capital appreciation. The net proceeds of the Offerings will be invested in a globally diversified Portfolio of securities issued in respect of real estate situated primarily in the worlds industrialized economies. While the Fund intends to invest primarily in publicly traded real estate securities, up to 20% of the Funds Total Assets (as hereinafter defined) may be invested directly in Canadian real estate or mortgages secured by Canadian real estate (collectively, Direct Real Estate Investments) where the Global Investment Advisor believes it is the most efficient way to access desired real estate. The Fund builds upon the Managers history of investing in real estate that offers secure and growing dividend yields while limiting volatility and protecting capital. The Manager Timbercreek Asset Management Ltd. provides fund management services to the Fund. The Manager, a wholly owned subsidiary of Timbercreek Asset Management Inc. (Timbercreek), is an investment management company that employs a conservative and risk-averse approach to real estate based investments. The Manager and its affiliates currently manage approximately $1.4 billion in real estate related assets, including direct ownership and mortgages. The Manager acts as trustee and manager of the Fund and provides, or arranges for the provision of, all administrative services required by the Fund. See Organization and Management Details of the Investment Fund. Global Investment Advisor The Manager has engaged the Global Investment Advisor to provide portfolio management services to the Fund, with Corrado Russo acting as lead portfolio manager (the Portfolio Manager). The Global Investment Advisor is a wholly owned subsidiary of Forum Securities Limited (Forum Securities), which is an affiliate of Forum Partners Investment Management LLC (Forum Partners). Forum Securities provides a platform for investment in global public real estate securities with over $900 million in assets under management as at December 31, 2010. Since inception, Forum Securities has demonstrated the ability to continually beat its benchmark while employing similar investment strategies to the Fund. On June 30, 2009, the Global Real Estate Securities team at Citi joined Forum Partners and created Forum Securities. Forum Securities and Forum Partners shall provide the Global Investment Advisor with such individuals and resources as are necessary to assist the Global Investment Advisor in discharging its obligations to the Fund. See Organization and Management Details of the Investment Fund. Distributions The Fund intends to continue to make quarterly distributions to Unitholders of record on the last Business Day of each calendar quarter (each, a Distribution Record Date). Distributions will be paid on a Business Day designated by the Manager that will be no later than the 15th day of the following month (each, a Distribution Payment Date). The quarterly distributions are currently targeted to be $0.21 per Unit ($0.84 per annum). The Fund does not have a fixed quarterly distribution but annually determines the expected distribution amount in March of each year. However, in respect of the March 2011 determination, in light of the Offerings, the Fund has determined that it intends to maintain a quarterly distribution of $0.21 per Unit ($0.84 per annum) until the next annual determination in March 2012. In addition, the Fund will allocate the next quarterly distribution as follows: Unitholders of record on February 28, 2011 will be entitled to receive a distribution of $0.14 per Class A Unit or Class B Unit, as applicable, to be paid on or about March 15, 2011 (the Advanced Distribution); the Advanced Distribution is equivalent to two-thirds of the quarterly distribution per Class A Unit and Class B Unit, respectively. A further first quarter distribution will be paid on April 15, 2011 to Unitholders of record on March 31, 2011 of $0.07 per Class A Unit or Class B Unit, as applicable. This is equivalent to one-third of the targeted quarterly distribution per Class A Unit and Class B Unit, respectively.
Based on the current and expected composition of the Portfolio, it is expected that distributions received in respect of securities held in the Portfolio will be sufficient to allow the Fund to fund its distributions at the current targeted level. If the return on the Portfolio (including net realized capital gains from the sale of securities in the Portfolio) is less than the amount necessary to fund the quarterly distributions, the Manager may return a portion of the capital of the Fund to Unitholders to ensure the distribution is paid and, accordingly, NAV per Unit would be reduced. See Risk Factors No Assurance of Achieving Investment Objectives. ___________ Price: $12.22 per Class A Unit and $12.21 per Class B Unit Minimum Purchase: 250 Class A Units or 1,000 Class B Units ___________
Price to the public(1) Per Class A Unit Per Class B Unit Total Maximum Offering(3)________________________________________ Notes: (1) (2)
Agents fees $0.57 $0.24 $4,664,484.99
Net proceeds to the Fund(2) $11.65 $11.97 $95,335,526.55
$12.22 $12.21 $100,000,011.54
The terms of the Offerings were established by negotiation between the Fund and the Agents (as defined herein), and the net proceeds to the Fund will not be less than the applicable most recently calculated net asset value per Unit. Before deducting the expenses of the Offerings (estimated at $385,000) which, subject to a maximum of 1.5% of the gross proceeds of the Offerings will, together with the Agents fees, be paid out of the proceeds of the Offerings; provided that if the fees and expenses of the Offerings would result in dilution to existing Unitholders based on the NAV per Class A Unit as at February 25, 2011, of $11.5594 and the NAV per Class B Unit as at February 25, 2011 of $11.9577, the Manager will reimburse the Fund in an amount representing such dilution. The Fund has granted to the Agents an option (the Over-Allotment Option), exercisable in whole or in part for a period of 30 days following the closing of the Offerings, to purchase an aggregate of up to 15% of the aggregate number of Class A Units issued at the closing of the Offerings at a price of $12.22 per Unit (the Option Units). If the Over-Allotment Option is exercised in full, the total price to the p