JMB 245 PARK AVENUE ASSOCIATES LTD - 10-K Annual Report

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

Annual Report Pursuant to Section 13 or 15(d)
of the Securities Act of 1934

For the fiscal year
ended December 31, 2002 Commission File Number 0-13545

JMB/245 PARK AVENUE ASSOCIATES, LTD.
------------------------------------------------------
(Exact name of registrant as specified in its charter)

Illinois 36-3265541
(State of organization) (I.R.S. Employer Identification No.)

900 N. Michigan Ave., Chicago, Illinois 60611
(Address of principal executive office) (Zip Code)

Registrant's telephone number, including area code 312-915-1960

Securities registered pursuant to Section 12(b) of the Act:

Name of each exchange on
Title of each class which registered
- ------------------- -------------------------
None None

Securities registered pursuant to Section 12(g) of the Act:

LIMITED PARTNERSHIP INTERESTS
(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 (the "Act") during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Yes [ X ] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K [ X ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes [ ] No [ X ]

State the aggregate market value of the voting and non-voting common equity
held by non-affiliates computed by reference to the price at which the
common equity was last sold, or the average bid and asked price of such
common equity, as of the last business day of the registrant's most
recently completed second fiscal quarter. Not applicable.

Documents Incorporated by Reference: None.

TABLE OF CONTENTS

Page
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PART I

Item 1. Business . . . . . . . . . . . . . . . . . . 1

Item 2. Properties . . . . . . . . . . . . . . . . . 5

Item 3. Legal Proceedings. . . . . . . . . . . . . . 5

Item 4. Submission of Matters to a
Vote of Security Holders . . . . . . . . . . 5

PART II

Item 5. Market for the Partnership's
Limited Partnership Interests and
Related Security Holder Matters. . . . . . . 5

Item 6. Selected Financial Data. . . . . . . . . . . 6

Item 7. Management's Discussion and
Analysis of Financial Condition and
Results of Operations. . . . . . . . . . . . 7

Item 7A. Quantitative and Qualitative
Disclosures About Market Risk. . . . . . . . 13

Item 8. Financial Statements and
Supplementary Data . . . . . . . . . . . . . 14

Item 9. Changes in and Disagreements with
Accountants on Accounting and
Financial Disclosure . . . . . . . . . . . . 45

PART III

Item 10. Directors and Executive Officers . . . . . . 45

Item 11. Executive Compensation . . . . . . . . . . . 47

Item 12. Security Ownership of Certain
Beneficial Owners and Management and
Related Security Holder Matters. . . . . . . 48

Item 13. Certain Relationships and
Related Transactions . . . . . . . . . . . . 49

Item 14. Controls and Procedures. . . . . . . . . . . 49

PART IV

Item 15. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K. . . . . . . . . . . 50

SIGNATURES and CERTIFICATIONS . . . . . . . . . . . . . . 54

i

PART I

ITEM 1. BUSINESS

Unless otherwise indicated, all references to "Notes" are to Notes to
Consolidated Financial Statements of JMB/245 Park Avenue Associates, Ltd.
contained in this report. Capitalized terms used herein, but not defined,
have the same meanings as used in the Notes.

The registrant, JMB/245 Park Avenue Associates, Ltd. (the
"Partnership"), is a limited partnership formed in 1983 and currently
governed by the Revised Uniform Limited Partnership Act of the State of
Illinois for the original purpose of acquiring and owning an approximate
48.25% interest in 245 Park Avenue Company, a New York general partnership,
("245 Park" or the "Joint Venture") which owned and operated an office
building located at 245 Park Avenue, New York, New York. The Partnership
was admitted to the Joint Venture through the purchase of one of the
existing unaffiliated joint venture partner's interests. The unaffiliated
venture partners (the "O&Y partners") were affiliates of Olympia & York
Developments, Ltd. ("O&Y"). On May 7, 1984, the Partnership commenced a
private offering of $124,300,000 in Limited Partnership Interests (the
"Interests") pursuant to a Private Placement Memorandum (the "Private
Placement Memorandum") in accordance with Rules 501-503 and 506 of
Regulation D of the Securities Act of 1933. A total of 1,000 Interests
were sold at $124,300 per Interest (except for twenty interests which were
sold net of any selling commission) of which $10,500 per Interest was due
upon admission, with the remaining purchase price paid in annual
installments from 1985 through 1990. The offering closed on June 28, 1984.

The holders of Interests (herein after "Holders" or "Holders of Interests")
in the Partnership share in their portion of the benefits of ownership of
the Partnership's real property investment according to the number of
Interests held.

As a result of the financial difficulties of the O&Y partners, in
October 1995 each of the O&Y partners and certain other O&Y affiliates (but
not the Joint Venture) filed for bankruptcy protection from creditors under
Chapter 11 of the United States Bankruptcy Code. During 1996, the O&Y
partners and these certain other O&Y affiliates restructured their
ownership interests in various office buildings, including their interest
in the 245 Park Avenue office building. In connection with such
restructuring, the Joint Venture filed for bankruptcy under Chapter 11 of
the United States Bankruptcy Code in April 1996 seeking approval of a plan
of reorganization by its creditors and the partners of the Joint Venture,
including the Partnership, and in August 1996, the Third Amended Joint Plan
of Reorganization and Disclosure Statement (the "Plan") was filed with the
Bankruptcy Court. The Plan was accepted by the various classes of claims
and equity holders and confirmed by the Court on September 20, 1996. The
Plan became effective on November 21, 1996 ("Effective Date") upon
completion of several additional steps. The conditions to the Plan
included, but were not limited to, the completion of significant
refinancing and capital transactions regarding 245 Park Avenue as well as
other properties. Pursuant to the terms of the Plan, the Partnership owned
through JMB 245 Park Avenue Holding Company, LLC ("245 Park Holding") an
approximate 5.4% general partner interest (slightly diluted from the
original ownership percentage by notes converted to equity) represented by
5,673.751 Class A Units in Brookfield Financial Properties, L.P. ("BFP,
LP"), formerly known as World Financial Properties, L.P. The managing
general partner of BFP, LP is an entity affiliated with certain O&Y
creditors and the proponents of the Plan governing the restructuring and,
subject to the partnership agreement of BFP, LP and the JMB Transaction
Agreement (discussed below), has full authority to manage its affairs. 245
Park Holding is a limited liability company in which the Partnership is a
99% member and WFP Property G.P. Corp. ("WFP, GP"), which is an affiliate
of the managing general partner of BFP, LP, is a 1% member.

In conjunction with the restructuring, the Partnership entered into
the JMB Transaction Agreement dated November 21, 1996, whereby the
Partnership was entitled to receive one-third of the monthly management
fees earned at the 245 Park Avenue property through December 2001. Amounts
received were not to be less than $400,000 or exceed $600,000 for any
twelve month period and were not to be less than $2,300,000 over the term
ending December 2001. The Partnership's right to receive such fees has
expired and all such amounts were received. For the twelve months ended
December 31, 2001, the Partnership earned approximately $599,000 of
management fees pursuant to the agreement. In addition, pursuant to the
JMB Transaction Agreement, the Partnership had the right, except under
certain circumstances, to prohibit (i) a sale of the 245 Park Avenue
property prior to January 2, 2000 and (ii) a reduction of the indebtedness
secured by the 245 Park Avenue property below a certain level prior to
January 2, 2003. As a result of the expiration of these provisions, there
is no assurance concerning when BFP, LP may arrange a full or partial sale
of the 245 Park Avenue property or a reduction in the indebtedness secured
by the 245 Park Avenue property. A reduction in a large amount of such
indebtedness or a full or partial sale of the 245 Park Avenue property
would result in the recognition by the Partnership (and the Holders of
Interests) of substantial gain for Federal income tax purposes without a
significant amount of proceeds from such transaction. During 2001, the
debt secured by the 245 Park Avenue property was refinanced with a new
mortgage obligation in the principal amount of $500 million. There were no
refinancing proceeds distributed to the Partnership.

The Partnership's interest in BFP, LP has been pledged as collateral
for certain notes payable (collectively "the JMB Notes") which aggregated
approximately $89,337,000 in principal and interest at December 31, 2002,
(immediately prior to repayment), to JMB Realty Corporation ("JMB"), and
required mandatory payment of principal and interest out of any net
proceeds received upon the redemption, refinancing or other disposition of,
or any distribution made with respect to, the Partnership's interest in
BFP, LP.

On December 31, 2002 (the "Redemption Date") 245 Park Holding entered
into a redemption agreement (the "Partial Redemption") by and among 245
Park Holding, WFP, GP and BFP, LP pursuant to which 245 Park Holding
transferred and BFP, LP thereby redeemed 5,106.376 Class A Units from 245
Park Holding, or 90% of its approximate 5.4% interest, (the "Redeemed
Interest") in BFP, LP and 245 Park Holding received a distribution of
approximately $56,109,000 (the "Redemption Distribution"). 245 Park
Holding's remaining interest in BFP, LP consists of 567.375 Class A Units
(the "Retained Interest"). In accordance with the 245 Park Holding limited
liability company agreement, 245 Park Holding distributed approximately
$55,548,000 (99% of the Redemption Distribution) to the Partnership and
approximately $561,000 (1% of the Redemption Distribution) to WFP, GP. The
Partnership received its share of the Redemption Distribution on the
Redemption Date and in accordance with the security agreement relating to
the JMB Notes, the Partnership then paid to JMB approximately $55,548,000
as repayment toward the JMB Notes. The Partnership reversed previously
accrued interest of approximately $4,158,000 and accordingly, four of the
five notes outstanding were retired. The unpaid principal and accrued
interest balance on the remaining JMB Note at December 31, 2002, was
approximately $29,631,000. Interest on the remaining JMB Note accrues at a
rate of 2% per annum and is compounded annually. The remaining JMB Note is
secured by the Partnership's interest in BFP, LP.

In connection with the Partial Redemption, the limited partnership
agreement of BFP, LP was amended (the "Amendment") to, among other things,
incorporate certain provisions from the JMB Transaction Agreement,
including the right of the Partnership to consent to the nomination of an
independent director to the board of directors of Brookfield Properties
Corporation ("BPC"), the parent company of the managing general partner of
BFP, LP. The JMB Transaction Agreement, as well as the Registration Right
Agreement between 245 Park Holding and BFP, LP, were otherwise terminated
in connection with the Amendment. The Amendment also generally provides
that in the event either (i) a sale or other disposition of the 245 Park
Avenue Building by BFP, LP results in the recognition by the Partnership of

gain for Federal income tax purposes, or (ii) as a result of a merger or
consolidation of BFP, LP, the Partnership thereafter holds less than one-
half of its Retained Interest in a form which does not give rise to a
material amount of gain for Federal income tax purposes, the Partnership
may elect to sell to BFP, LP, and BFP, LP may elect to redeem from the
Partnership, the Retained Interest at its fair market value (as defined in
the BFP, LP partnership agreement) per Class A Unit, but in no event less
than 80% ($8,790), and no greater than 120% ($13,186), of the Redemption
Distribution per Class A Unit in the Partial Redemption.

BFP, LP has had the right to sell the 245 Park Avenue property without
the consent of the Partnership since January 2000. In the Amendment, BFP,
LP is obligated to use its commercially reasonable efforts, in any
agreement of merger or consolidation entered into by BFP, LP on or before
December 2007, to the extent that the consideration is comprised in whole
or in part of equity interests, to provide for the Partnership to obtain
its share of such equity interests in a form such that the Partnership will
not recognize a material amount of gain for Federal income tax purposes.
If BFP, LP, having used its commercially reasonable efforts, is unable to
provide for the Partnership to receive such an equity interest, BFP, LP
must pay to the Partnership, in addition to the Partnership's share of the
merger consideration, a cash amount equal to the percentage of the merger
consideration in the form of equity multiplied by a number which is $14
million in 2003 and reduces by $1.5 million per year through the year 2007.

The Partnership recognized approximately $79,194,000 of net gain on
the Partial Redemption for financial reporting purposes. No gain was
recognized by the Partnership for Federal income tax purposes.

BFP, LP has a substantial amount of indebtedness outstanding. If any
of the buildings in which BFP, LP has an interest are sold, any proceeds
would be first applied to repayment of the mortgage and other indebtedness
of BFP, LP. In any event, any net proceeds obtained by the Partnership
could then be available to satisfy the remaining JMB Note. Only after such
applications would any remaining proceeds be available to be distributed to
the Holders of Interests. Similarly, in the event of a sale or other
disposition of the Retained Interest (including a redemption pursuant to an
election discussed above), the proceeds of such sale or disposition would
be available to satisfy the remaining JMB Note. Only after such
application would remaining proceeds, if any, be available to be
distributed to the Holders of Interests.

As a result, it is unlikely that the Holders of Interests ever will
receive any significant portion of their original investment. However, it
is expected that Holders of Interests will be allocated a substantial
amount of gain for Federal income tax purposes as a result of one or more
transactions which may occur over the remaining term of the Partnership.
These transactions include (i) a full or partial sale or other disposition
of the 245 Park Avenue property or other properties in which BFP, LP owns
an interest; (ii) a sale or other disposition of the Partnership's interest
in BFP, LP; or (iii) a significant reduction in the indebtedness of the 245
Park Avenue property or other indebtedness of the Partnership for Federal
income tax purposes. Moreover, none of these potential transactions is
expected to result in Holders of Interests receiving any significant cash
distributions. The amount of gain for Federal income tax purposes to be
allocated to a Holder of Interests over the remaining term of the
Partnership is expected to be, at a minimum, equal to all or most of the
amount of such Holder's deficit capital account for tax purposes. Such
gain may be offset by suspended losses from prior years (if any) that have
been allocated to the Holder of Interests. The actual tax liability of
each Holder of Interests will depend on such Holder's own tax situation.

BFP, LP's principal assets are majority and controlling interests in
the following nine office buildings:

APPROXIMATE RENTABLE AREA
PROPERTY AND LOCATION (Includes Office and Retail Space)

One World Financial Center 1,600,000 square feet
New York, New York

Two World Financial Center 2,500,000 square feet
New York, New York

Three World Financial Center 2,100,000 square feet
New York, New York

Four World Financial Center 1,800,000 square feet
New York, New York

One Liberty Plaza 2,200,000 square feet
New York, New York

245 Park Avenue 1,700,000 square feet
New York, New York

300 Madison Avenue 1,200,000 square feet
New York, New York

53 State Street 1,150,100 square feet
Boston, Massachusetts

75 State Street 1,000,000 square feet
Boston, Massachusetts
(acquired 9/15/98)

The One, Two and Four World Financial Center and 53 State Street
office buildings are owned subject to ground leases of the underlying land.

BFP has reported that the 300 Madison Avenue building is currently
under development and the core and shell of the building are currently
expected to be substantially completed in late 2003. BPC has reported that
acquisition and ongoing development costs are to be funded primarily
through a $400 million refinancing obtained in April 2002 and secured by
the project. A second tranche of financing, estimated to be approximately
$160 million, is expected to be funded through a commercial paper conduit
facility and drawn to finance completion of the project. The majority of
the approximately 1.2 million square feet of space in the project has been
leased to one tenant for a 30-year term. The tenant also has an option,
for two years after substantial completion of the project, to acquire a 49%
interest in the project at cost.

BPC has reported that during 2002, BFP, LP acquired an approximate 51%
interest (or approximately 1.2 million square feet of the total 2.1 million
square feet) in Three World Financial Center for $158 million. BFP, LP
incurred $150 million of indebtedness on the acquisition of its interest in
the property. Three World Financial Center is the world headquarters of
American Express, which is a co-owner of the building. BFP, LP has
exclusive rights to lease 1.2 million square feet of space in the building
not occupied by American Express, and BFP, LP is not entitled to rents
attributable to the space occupied by American Express. BFP, LP acquired
its interest in Three World Financial Center with the repairs to the damage
sustained as a result of the collapse of the World Trade Center completed.
However, according to BPC, substantial construction remains to be completed
prior to occupancy and will not be undertaken until a lead tenant is
obtained.

The Partnership has no employees.

The terms of transactions between the Partnership and the General
Partners and their affiliates are set forth in Item 11 below and in the
Notes, to which reference is hereby made for a description of such
transactions.

ITEM 2. PROPERTIES

The Partnership owns an indirect interest in the properties referred
to under Item 1 above to which reference is hereby made for a description
of said properties. Reference is also made to Note 3 of the Notes to the
Consolidated Financial Statements of Brookfield Financial Properties, L.P.
included with this Report for a further description of the properties.
BFP, LP has mortgage loans secured by its properties. Reference is made to
Note 4 of the Notes to the Consolidated Financial Statements of Brookfield
Financial Properties, L.P. included in this Report for a discussion of BFP,
LP's mortgage indebtedness. The Partnership's interest in BFP, LP is
pledged as collateral for a note payable with deferred interest
(aggregating approximately $29,631,000 at December 31, 2002) to JMB.

ITEM 3. LEGAL PROCEEDINGS

The Partnership is not subject to any material pending legal
proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There were no matters submitted to a vote of security holders during
2001 and 2002.

PART II

ITEM 5. MARKET FOR THE PARTNERSHIP'S LIMITED PARTNERSHIP INTERESTS
AND RELATED SECURITY HOLDER MATTERS

As of January 1, 2003, there were 876 record holders of Interests in
the Partnership. There is no public market for Interests and it is not
anticipated that a public market for Interests will develop. Consequently,
a Holder may not be able to sell or otherwise liquidate his or her
Interests. In addition, the Interests have not been registered under the
Securities Act of 1933, as amended, or (with certain exceptions) under
state securities laws. Transfers of the Interests must be made in
compliance with applicable federal and state securities laws and are
subject to the restrictions on transfers set forth in Article 14 (pages 15-
17) of the Amended and Restated Agreement of Limited Partnership of the
Partnership, which is incorporated herein by reference to Exhibit 99.1 to
this annual report. A sale or other transfer of an Interest may result in
material adverse Federal income tax consequences.

The Partnership has not made any distributions since 1989. The
Partnership's interest in BFP, LP is pledged as collateral for a note
payable with deferred interest (aggregating approximately $29,631,000 at
December 31, 2002) to JMB, which requires mandatory payment of principal
and interest out of (i) any distributions received from BFP, LP, and (ii)
any net proceeds received upon the sale, refinancing or other disposition
of the Partnership's interest in BFP, LP. Reference is made to the Notes
and Item 7 for a discussion of the restrictions on the distributions (if
any) to the Partnership from BFP, LP.

ITEM 6. SELECTED FINANCIAL DATA
JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
and Consolidated Venture

DECEMBER 31, 2002, 2001, 2000, 1999 AND 1998 (a)
(NOT COVERED BY INDEPENDENT AUDITORS' REPORT)

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

Capitalized terms used but not defined in this Item 7 have the same
meanings as used in Item 1. Business or in the Notes.

As of December 31, 2002, (prior to repayment of four of the JMB
Notes), JMB Realty Corporation ("JMB") had advanced approximately
$12,376,000, under the original demand note, which reflected the principal
and interest payments made on the LIBOR Note pursuant to the terms of the
original modification and extension of the Partnership's term loans and
additional advances to pay operating costs of the Partnership. Interest
accrued on these advances at the annual rate of the prime rate (as such
prime rate changes from time to time) plus 1% (5.25% at December 31, 2002)
and payment was deferred. The Partnership made a payment to JMB of
$400,000 during 2001 for interest payable on this demand note. On
December 31, 2002, in conjunction with the repayment of four of the JMB
Notes, discussed below, the Partnership paid to JMB the original demand
note balance and accrued interest of approximately $16,765,000 and reversed
previously accrued interest of approximately $3,675,000. Reference is made
to the Notes for further information concerning borrowings incurred by the
Partnership.

Prior to December 31, 2002, the Partnership had three term loan notes
and two demand notes including the original demand note discussed above
payable to JMB (collectively, the "JMB Notes"). One (the "LIBOR Note") of
the term loan notes had an outstanding principal balance of $16,042,000 and
bore interest at a variable rate related to LIBOR plus 2.625% (4.064% at
December 31, 2002) per annum. The other two term loan notes had an
aggregate outstanding principal balance of approximately $27,195,000 and
bore interest at 2% per annum. The remaining term loan note continues to
accrue interest at 2% per annum that is compounded annually. Effective
January 3, 2001, the Partnership and JMB agreed to extend the maturity date
of the term loan notes from December 31, 1998 to January 2, 2006 and
otherwise to follow literally the various terms of the notes. As a result,
the parties agreed that the Partnership would be required to pay default
interest on each of the three term loan notes (at the prime rate plus 3%
per annum) for the period from the maturity date of December 31, 1998 to
January 3, 2001, the effective date on which JMB and the Partnership agreed
to extend each of the notes. Accordingly, incremental interest cost
relating to the default interest rate aggregating approximately $7.7
million was recorded as expense in the year ended December 31, 2000. Under
the extended notes, interest accrued under the same terms as applicable to
the term loan notes prior to December 31, 1998. Interest was due and
payable monthly on the LIBOR Note with the outstanding principal due and
payable on January 2, 2006. All principal and accrued and compounded
interest on the other term loan notes (including the note representing the
interest rate swap payment) were due and payable on January 2, 2006.
Further, all outstanding interest as of December 31, 2000 on the LIBOR Note
(approximately $10.8 million) was due and payable immediately. In 2001,
the Partnership issued a new demand note payable to JMB, bearing interest
at the prime rate (as such prime rate changes from time to time) plus 1%
(5.25% at December 31, 2002) per annum with interest accruing and
compounding quarterly. Through December 31, 2002 (prior to repayment of
four of the JMB Notes), JMB had advanced approximately $12,903,000 to the
Partnership pursuant to the new demand note. The Partnership used the
advances to pay the outstanding interest on the LIBOR Note through
December 31, 2001 of approximately $12,240,000 and to pay accrued interest
on the LIBOR Note from January 1, 2002 through December 31, 2002 of
approximately $663,000. On December 31, 2002, the Partnership repaid to
JMB the new demand note balance, including accrued interest, of
approximately $14,267,000. In addition, the Partnership repaid to JMB the
LIBOR Note balance, including accrued interest, of approximately
$16,098,000, and repaid to JMB approximately $8,418,000, including
principal and accrued interest on the outstanding balance of the other two

term loan notes. The note repayments were made with the Partnership's
share of proceeds from the Redemption Distribution discussed below. In
addition, the Partnership reversed previously accrued interest of
approximately $483,000 on one of the term loan notes.

Prior to the Partial Redemption discussed below, the Partnership owned
through JMB 245 Park Avenue Holding Company, LLC ("245 Park Holding") an
approximate 5.4% general partner interest (slightly diluted from the
original ownership percentage by notes convertible to equity) represented
by 5,673.751 Class A Units in Brookfield Financial Properties, L.P. ("BFP,
LP"). BFP, LP's principal assets are majority and controlling interests in
various office buildings located in New York, New York and Boston,
Massachusetts. 245 Park Holding is a limited liability company in which
the Partnership is a 99% member and WFP Property G.P. Corp. ("WFP, GP"),
which is an affiliate of the managing general partner of BFP, LP, is a 1%
member.

Pursuant to the JMB Transaction Agreement dated November 21, 1996, the
Partnership was entitled to receive one-third of the monthly management
fees earned at the 245 Park Avenue property through December 2001. Amounts
received were not to be less than $400,000 or exceed $600,000 for any
twelve month period and were not to be less than $2,300,000 over the term
of the agreement. The Partnership's right to receive such fees has expired
and all such amounts were received. For the twelve months ended
December 31, 2001, the Partnership earned approximately $599,000 of
management fees pursuant to the agreement. In addition, pursuant to the
JMB Transaction Agreement, the Partnership had the right, except under
certain circumstances, to prohibit (i) a sale of the 245 Park Avenue
property prior to January 2, 2000 and (ii) a reduction of the indebtedness
secured by the 245 Park Avenue property below a certain level prior to
January 2, 2003. As a result of the expiration of these provisions, there
is no assurance concerning when BFP, LP may arrange a full or partial sale
of the 245 Park Avenue property or a reduction in the indebtedness secured
by the 245 Park Avenue property. A reduction in a large amount of such
indebtedness or a full or partial sale of the 245 Park Avenue property
would result in the recognition by the Partnership (and the Holders of
Interests) of substantial gain for Federal income tax purposes without a
significant amount of proceeds from such transaction. During 2001, the
debt secured by the 245 Park Avenue property was refinanced with a new
mortgage obligation in the principal amount of $500 million. There were no
refinancing proceeds distributed to the Partnership.

The Partnership's interest in BFP, LP has been pledged as collateral
for the JMB Notes which aggregated approximately $89,337,000 in principal
and interest at December 31, 2002 (prior to repayment), and required
mandatory payment of principal and interest out of any net proceeds
received by the Partnership upon the sale, refinancing or other disposition
of, or any distribution made with respect to, the Partnership's interest in
BFP, LP.

On December 31, 2002 (the "Redemption Date") 245 Park Holding entered
into a redemption agreement (the "Partial Redemption") by and among 245
Park Holding, WFP, GP and BFP, LP pursuant to which 245 Park Holding
transferred and BFP, LP thereby redeemed 5,106.376 Class A Units from 245
Park Holding, or 90% of its approximate 5.4% interest, (the "Redeemed
Interest") in BFP, LP and 245 Park Holding received a distribution of
approximately $56,109,000 (the "Redemption Distribution"). 245 Park
Holding's remaining interest in BFP, LP consists of 567.375 Class A Units
(the "Retained Interest"). In accordance with the 245 Park Holding limited
liability company agreement, 245 Park Holding distributed approximately
$55,548,000 (99% of the Redemption Distribution) to the Partnership and
approximately $561,000 (1% of the Redemption Distribution) to WFP, GP. The
Partnership received its share of the Redemption Distribution on the
Redemption Date and in accordance with the security agreements relating to
the JMB Notes, the Partnership then paid to JMB approximately $55,548,000
as repayment toward the JMB Notes. The Partnership reversed previously
accrued interest of approximately $4,158,000 and accordingly, four of the
five notes outstanding were retired. The unpaid principal and accrued
interest balance on the remaining JMB Note at December 31, 2002 was
approximately $29,631,000. The remaining JMB Note, which is secured by the
Partnership's interest in BFP, LP, accrues interest at 2% per annum, with
the interest compounded annually.

In connection with the Partial Redemption, the limited partnership
agreement of BFP, LP was amended (the "Amendment") to, among other things,
incorporate certain provisions from the JMB Transaction Agreement,
including the right of the Partnership to consent to the nomination of an
independent director to the board of directors of Brookfield Properties
Corporation ("BPC"), the parent company of the managing general partner of
BFP, LP. The JMB Transaction Agreement, as well as the Registration Right
Agreement between 245 Park Holding and BFP, LP, were otherwise terminated
in connection with the Amendment. The Amendment also generally provides
that in the event either (i) a sale or other disposition of the 245 Park
Avenue Building by BFP, LP results in the recognition by the Partnership of
gain for Federal income tax purposes, or (ii) as a result of a merger or
consolidation of BFP, LP, the Partnership thereafter holds less than one-
half of its Retained Interest in a form which does not give rise to a
material amount of gain for Federal income tax purposes, the Partnership
may elect to sell to BFP, LP, and BFP, LP may elect to redeem from the
Partnership, the Retained Interest at its fair market value (as defined in
the BFP, LP partnership agreement) per Class A Unit, but in no event less
than 80% ($8,790), and no greater than 120% ($13,186), of the Redemption
Distribution per Class A Unit in the Redemption.

BFP, LP has had the right to sell the 245 Park Avenue property without
the consent of the Partnership since January 2000. In the Amendment, BFP,
LP is obligated to use its commercially reasonable efforts, in any
agreement of merger or consolidation entered into by BFP, LP on or before
December 2007, to the extent that the consideration is comprised in whole
or in part of equity interests, to provide for the Partnership to obtain
its share of such equity interests in a form such that the Partnership will
not recognize a material amount of gain for Federal income tax purposes.
If BFP, LP, having used its commercially reasonable efforts, is unable to
provide for the Partnership to receive such an equity interest, BFP, LP
must pay to the Partnership, in addition to the Partnership's share of the
merger consideration, a cash amount equal to the percentage of the merger
consideration in the form of equity multiplied by a number which is $14
million in 2003 and reduces by $1.5 million per year through the year 2007.

The Partnership recognized a net gain of approximately $79,194,000 on
the Partial Redemption for financial reporting purposes. No gain was
recognized on the Partial Redemption by the Partnership for Federal income
tax purposes.

BPC has reported that on September 11, 2001, BFP, LP owned eight
million square feet of space in four office towers surrounding the World
Trade Center site - One Liberty Plaza and One, Two and Four World Financial
Center. The physical damage sustained by these properties was mainly
cosmetic as a result of the attack on and subsequent collapse of the World
Trade Center and consisted primarily of replacement of broken windows and
some repair to the granite facade on the World Financial Center. While
there was no structural damage to these four office towers, the glass-
enclosed Winter Garden atrium at the center of the World Financial Center
suffered more significant damage from falling debris than other areas of
the complex. This component of the World Financial Center was fully
restored and opened in September 2002.

To date, approximately $182 million has been received for property and
business interruption claims relating to One Liberty Plaza, One World
Financial Center, the Winter Garden and common areas of the World Financial
Center. Two and Four World Financial Center are covered by insurance in
place under the tenant triple-net leases with Merrill Lynch. BFP, LP's
insurance claim adjustment process is ongoing due to the complexity of the
issues involved. However, BFP, LP anticipates recovery of all material
amounts relating to the restoration and business interruption costs of its
properties.

One Liberty Plaza and Four World Financial Center reopened in October
2001 and One and Two World Financial Center reopened in the first quarter
of 2002. No material lease cancellations in the New York portfolio
occurred as a result of the events of September 11.

BFP, LP has insurance covering certain acts of terrorism for up to
$300 million of damage and business interruption costs. BFP, LP continues
to seek additional coverage equal to the full replacement cost of its
assets; however, until this type of coverage becomes commercially available
on an economically reasonable basis, any damage or business interruption
costs as a result of uninsured acts of terrorism could result in a material
cost to the company. BFP, LP believes it is in compliance with all of its
loan covenants, despite not being able to acquire terrorism coverage for
the full replacement cost of the company's properties. Reference is made
to Note 9 of the Notes to Consolidated Financial Statements of Brookfield
Financial Properties, L.P. included in this Report for a discussion of the
damage incurred as a result of the events of September 11, 2001, and
insurance coverage for BFP, LP's properties.

In December 1999, BFP, LP executed an agreement pursuant to which an
institutional investor agreed to an option to purchase a 49% limited
partnership interest in the entities that own the 53 State Street and 75
State Street office buildings. The transaction closed during the first
quarter of 2001 and generated net proceeds of approximately $168 million to
BFP, LP. The transaction resulted in gain for Federal income tax purposes
without any cash proceeds to the Partnership.

BPC has reported that during the first quarter of 2001, BFP, LP
refinanced the loans secured by the 245 Park Avenue and One Liberty Plaza
office buildings with loans of $500 million and $432 million, respectively.

The financing secured by the 245 Park Avenue property has a term of ten
years and bears interest at a fixed rate of 6.65% per annum. The financing
secured by One Liberty Plaza has a term of ten years and bears interest at
a fixed rate of 6.75% per annum.

BFP, LP is currently developing a 31-story office building at 300
Madison Avenue in New York, New York. The core and shell of the building
are currently expected to be completed in late 2003. BPC has reported that
acquisition and ongoing development costs are to be funded primarily
through a $400 million refinancing obtained in April 2002 and secured by
the project. A second tranche of financing, estimated to be approximately
$160 million, is expected to be funded through a commercial paper conduit
facility and drawn to finance completion of the project. BPC has reported
that a majority of the approximately 1.2 million square feet of space to be
built for this property has been pre-leased to a single tenant for a 30-
year term. The tenant also has an option, for two years after substantial
completion of the project, to acquire a 49% interest in the project at
cost.

According to BPC, during 2002, BFP, LP acquired an approximate 51%
interest (or approximately 1.2 million square feet of the total 2.1 million
square feet) in Three World Financial Center for $158 million. BFP, LP
incurred $150 million of indebtedness on the acquisition of its interest in
the property. Three World Financial Center is the world headquarters of
American Express, which is a co-owner of the building. BFP, LP has
exclusive rights to lease 1.2 million square feet of space in the building
not occupied by American Express, and BFP, LP is not entitled to rents
attributable to the space occupied by American Express. BFP, LP acquired
its interest in Three World Financial Center with the repairs completed to
the damage sustained as a result of the collapse of the World Trade Center.

However, according to BPC, substantial construction remains to be completed
prior to occupancy and will not be undertaken until a lead tenant is
obtained.

During 2003, the non-recourse existing mortgage loan in the principal
amount of approximately $402 million secured by One World Financial Center
will become due. BPC has stated it is expected that this loan will be
refinanced on a short-term, floating interest-rate basis with partial
recourse.

Persons who are interested in obtaining more information concerning
BPC should be aware that BPC files periodic reports and other information,
which includes information about BFP, LP and its assets and operations,
with the U.S. Securities and Exchange Commission ("SEC") pursuant to the
Securities Exchange Act of 1934 (the "Exchange Act"). BPC's filings with
the SEC are available to the public through the SEC's Electronic Data
Gathering, Analysis and Retrieval system accessible through the SEC's web
site at http://www.sec.gov. Interested persons also may read and copy any
report, statement or other information that BPC has filed with the SEC at
its Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549,
or may call the SEC for more information on obtaining information from the
SEC's public reference rooms. This description is provided for
informational purposes only. The Partnership does not prepare, and is not
responsible for the preparation of, any of BPC's reports or other
information it files with the SEC. Those reports and other information are
not intended to be incorporated by reference into this report on Form 10-K,
and the Partnership has no responsibility for the accuracy of any
information included in BPC's reports or other information.

BFP, LP has a substantial amount of indebtedness outstanding. If any
of the buildings in which BFP, LP has an interest are sold, any proceeds
would be first applied to repayment of the mortgage and other indebtedness
of BFP, LP. In any event, any net proceeds obtained by the Partnership
could then be available to satisfy the remaining note payable and interest
to JMB. Only after such applications would any remaining proceeds be
available to be distributed to the Holders of Interests. Similarly, in the
event of a sale or other disposition of the Retained Interest (including a
redemption pursuant to an election discussed above), the proceeds of such
sale or disposition would be available to satisfy the remaining JMB Note.
Only after such application would remaining proceeds, if any, be available
to be distributed to the Holders of Interests.

It is unlikely that the Holders of Interests ever will receive any
significant portion of their original investment. However, it is expected
that Holders of Interests will be allocated a substantial amount of gain
for Federal income tax purposes as a result of one or more transactions
which may occur over the remaining term of the Partnership. These
transactions include (i) a full or partial sale or other disposition of the
245 Park Avenue property or other properties in which BFP, LP owns an
interest; (ii) a sale or other disposition of the Partnership's interest in
BFP, LP; or (iii) a significant reduction in the indebtedness of the 245
Park Avenue property or other indebtedness of the Partnership for Federal
income tax purposes. Moreover, none of these potential transactions is
expected to result in Holders of Interests receiving any significant cash
distributions. The amount of gain for Federal income tax purposes to be
allocated to a Holder of Interests over the remaining term of the
Partnership is expected to be, at a minimum, equal to all or most of the
amount of such Holder's deficit capital account for tax purposes. Such
gain may be offset by suspended losses from prior years (if any) that have
been allocated to the Holder of Interests. The actual tax liability of
each Holder of Interests will depend on such Holder's own tax situation.

The Partnership's future liquidity and ability to continue as a going
concern is dependent upon additional advances from JMB and there is no
assurance that such advances will be made.

RESULTS OF OPERATIONS

The decrease in other receivables at December 31, 2002 as compared to
December 31, 2001 is primarily due to the timing of receipt of certain
property management fees from 245 Park Avenue. The Partnership's right to
receive such fees pursuant to the JMB Transaction Agreement expired
December 31, 2001.

The increase in accounts payable at December 31, 2002 as compared to
December 31, 2001 is primarily due to the timing of payment of certain
legal fees of the Partnership related to the partial redemption of the
Partnership's interest in BFP, LP in December 2002 as of the 2002 year end.

The decreases in interest payable to affiliate, demand notes payable
to affiliate and notes payable to affiliate - long-term including accrued
interest at December 31, 2002, as compared to December 31, 2001 are
primarily due to the repayments toward the JMB Notes of approximately
$55,548,000 made on December 31, 2002 as well as the reversal of previously
accrued interest.

The decreases in the liability for investment in unconsolidated
venture, at equity and in venture partner's equity in venture is primarily
due to the gain on redemption of the Partnership's interest in BFP, LP in
December 2002 as well as the Partnership's share of the net income of BFP,
LP. In addition, because the Partnership has no future funding
obligations, has no influence or control over the day-to-day affairs of
BFP, LP and its investment in BFP, LP has been reduced to less than 1%,
subsequent to the Redemption Date, the Partnership has discontinued the
application of the equity method of accounting, recorded its investment at
zero and will no longer recognize its share of earnings or losses from BFP,
LP.

Interest and other income for the years ended December 31, 2001 and
2000 primarily consists of the Partnership's share of the property
management fees from the 245 Park Avenue property pursuant to the terms of
the JMB Transaction Agreement described above.

The decrease in interest expense for the year ended December 31, 2002
as compared to the year ended December 31, 2001 is due to lower average
interest rates on the outstanding principal balances of the LIBOR Note and
the demand notes payable to JMB. The decrease in interest expense for the
year ended December 31, 2001 as compared to the year ended December 31,
2000 is primarily due to default interest in the amount of approximately
$7.7 million being recorded during 2000 on the term loans for the two years
ended December 31, 2000. The decrease in interest expense for 2001 is also
due to lower interest rates on the LIBOR Note and the demand notes, which
were variable rate obligations.

Reversal of previously accrued interest at December 31, 2002
represents the reversal of interest accrued on certain of the JMB Notes in
conjunction with the Partnership's repayment towards the JMB Notes and
corresponding retirement of four of the five notes outstanding.

The decrease in professional services for the year ended December 31,
2002 as compared to the year ended December 31, 2001 is primarily due to
legal fees incurred related to the extension of the Partnership's term loan
notes in 2001 and also partially due to lower costs for accounting services
in 2002, partially offset by professional services for legal services
related to the partial redemption of the Partnership's interest in BFP, LP
in 2002. The increase in professional services for the year ended
December 31, 2001 as compared to the year ended December 31, 2000 is
primarily due to legal fees related to the extension of the Partnership's
term loan notes.

The increase in general and administrative expense for the year ended
December 31, 2002 as compared to the year ended December 31, 2001 is
primarily due to an increase in reimbursements to an affiliate of the
Corporate General Partner for portfolio management services in 2002.

The increases in Partnership's share of earnings (loss) from
operations of unconsolidated venture and venture partner's share of venture
operations for the year ended December 31, 2002 as compared to the year
ended December 31, 2001 is primarily due to the write-off of capitalized
financing costs by BFP, LP in the third quarter of 2001.

The gain on redemption of Partnership's interest in BFP, LP in 2002 is
due to the redemption of 90% of such interest in December 2002, as
discussed above.

INFLATION

Due to the low levels of inflation in recent years, inflation
generally has not had a material effect on rental income or property
operating expenses.

USE OF ESTIMATES AND CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions. These estimates and
assumptions affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Critical accounting policies are those that
are both significant to the overall presentation of the Partnership's
financial condition and results of operations and require management to
make difficult, complex or subjective judgments. The Partnership made no
significant estimates or assumptions for the year ended December 31, 2002
and thus has concluded that there are no critical accounting policies.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a result of the repayment on December 31, 2002, of the LIBOR Note
and the demand notes, which had variable interest rates, the Partnership
does not believe that it currently has a material exposure to market rate
risk.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
and Consolidated Venture

INDEX

Independent Auditors' Report
Consolidated Balance Sheets, December 31, 2002 and 2001
Consolidated Statements of Operations, years ended
December 31, 2002, 2001 and 2000
Consolidated Statements of Partners' Capital Accounts (Deficits),
years ended December 31, 2002, 2001 and 2000
Consolidated Statements of Cash Flows, years ended
December 31, 2002, 2001 and 2000
Notes to Consolidated Financial Statements

Schedules not filed:

All schedules have been omitted as the required information is
inapplicable, or the information is presented in the consolidated financial
statements or related notes.

BROOKFIELD FINANCIAL PROPERTIES, L.P.

INDEX

Independent Auditors' Report
Consolidated Balance Sheets, December 31, 2002 and 2001
Consolidated Statements of Operations, for the years ended
December 31, 2002 and 2001
Consolidated Statements of Partners' Capital, for the years ended
December 31, 2002 and 2001
Consolidated Statements of Cash Flows, for the years ended
December 31, 2002 and 2001
Notes to Consolidated Financial Statements

INDEPENDENT AUDITORS' REPORT

The Partners
JMB/245 Park Avenue Associates, Ltd.:

We have audited the consolidated financial statements of JMB/245 Park
Avenue Associates, Ltd., a limited partnership (the "Partnership"), and
consolidated venture as listed in the accompanying index. These
consolidated financial statements are the responsibility of the General
Partners of the Partnership. Our responsibility is to express an opinion
on these consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards
generally accepted in the United States of America. Those standards
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates
made by the General Partners of the Partnership, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial position of
JMB/245 Park Avenue Associates, Ltd. and consolidated venture as of
December 31, 2002 and 2001, and the results of their operations and their
cash flows for each of the years in the three-year period ended
December 31, 2002, in conformity with accounting principles generally
accepted in the United States of America.

The accompanying consolidated financial statements have been prepared
assuming that JMB/245 Park Avenue Associates, Ltd. will continue as a going
concern. As described in the notes to the financial statements, the
Partnership is dependent upon additional advances from JMB under the demand
loans. This uncertainty and the fact that the Partnership has a net
capital deficiency raise substantial doubt about its ability to continue as
a going concern. The General Partners' plans in regard to these matters
are also described in the notes to the financial statements. The
accompanying consolidated financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

KPMG LLP

Chicago, Illinois
May 29, 2003

JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
and Consolidated Venture

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2002 AND 2001

ASSETS
------

JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
and Consolidated Venture

CONSOLIDATED STATEMENTS OF OPERATIONS

YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000

JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
and Consolidated Venture

CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS (DEFICITS)

YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000

JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
and Consolidated Venture

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000

JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
and Consolidated Venture

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002, 2001 AND 2000

OPERATIONS AND BASIS OF ACCOUNTING

GENERAL

As a result of the 1996 restructuring and until December 31, 2002,
JMB/245 Park Avenue Associates, Ltd. (the "Partnership") owned through JMB
245 Park Avenue Holding Company, LLC ("245 Park Holding") an approximate
5.4% general partner interest (slightly diluted from the original ownership
percentage by notes converted to equity) represented by 5,673.751 Class A
Units in Brookfield Financial Properties, L.P. ("BFP, LP"), formerly known
as World Financial Properties, L.P. On December 31, 2002, 90% of 245 Park
Holding's interest in BFP, LP was redeemed, as described in "Investment in
Unconsolidated Venture" below. BFP, LP is a joint venture that holds
equity investments in commercial office buildings located in New York, New
York and Boston, Massachusetts. Business activities consist of rentals to
a variety of commercial companies and the ultimate sale or disposition of
such real estate. 245 Park Holding is a limited liability company in which
the Partnership is a 99% member and WFP Property G.P. Corp. ("WFP, GP"),
which is an affiliate of the managing general partner of BFP, LP, is a 1%
member. The accompanying consolidated financial statements include the
accounts of the Partnership and its majority-owned limited liability
company, 245 Park Holding, which was formed November 21, 1996 ("Effective
Date"). Prior to the Effective Date, the Partnership held an approximate
48.25% interest in 245 Park Avenue Company ("245 Park" or the "Joint
Venture"), which owned the 245 Park Avenue office building in New York, New
York (see "Investment in Unconsolidated Venture" below). The effect of all
transactions between the Partnership and its consolidated venture has been
eliminated.

The equity method of accounting has been applied in the accompanying
consolidated financial statements with respect to the Partnership's
interest in BFP, LP subsequent to the Effective Date through December 31,
2002 (the "Redemption Date") when the Partnership's indirect interest in
BFP, LP was reduced to less than 1%. Because the Partnership has no future
funding obligations, has no influence or control over the day-to-day
affairs of BFP, LP. and its investment in BFP, LP has been reduced to less
than 1%, subsequent to the Redemption Date, the Partnership has
discontinued the application of the equity method of accounting, recorded
its investment at zero and will no longer recognize its share of earnings
or losses from BFP, LP.

In April 2002, the FASB issued Statement No. 145 which, among other
things, rescinds the requirement that gains and losses on extinguishments
of debt be classified as extraordinary items. The Company adopted
Statement No. 145 effective October 1, 2002, which requires reclassifica-
tions of prior extraordinary gains on extinguishment of debt. The adoption
of Statement No. 145 did not have an effect on the Partnership's financial
statements presented.

The Partnership's records are maintained on the accrual basis of
accounting as adjusted for Federal income tax reporting purposes. The
accompanying consolidated financial statements have been prepared from such
records after making appropriate adjustments to reflect the Partnership's
accounts in accordance with accounting principles generally accepted in the
United States of America ("GAAP") and to consolidate the accounts of 245
Park Holding as described above. Such GAAP and consolidation adjustments
are not recorded on the records of the Partnership. The net effect of
these items for the years ended December 31, 2002 and 2001 is summarized as
follows:

2002 2001
-------------------------- --------------------------
TAX BASIS TAX BASIS
GAAP BASIS (UNAUDITED) GAAP BASIS (UNAUDITED)
----------- ------------ ------------ ------------
Total assets. . $ 356,639 (159,851,605) 557,938 (107,577,851)

Partners'
capital
accounts
(deficits):
General
partners . . (11,211,468) (50,753,934) (12,513,842) (44,886,198)
Limited
partners . . (18,184,204) (133,298,916) (104,582,808) (136,339,455)

Net earnings
(losses):
General
partners . . 1,302,374 (5,867,736) 238,726 (17,457,305)
Limited
partners . . 86,398,604 3,040,539 3,740,046 5,519,544

Net earnings
(loss) per
limited
partnership
interest. . . 87,536 3,081 3,759 5,547
=========== ============ ============ ============

The net earnings (loss) per limited partnership interest is based upon
the number of limited partnership interests outstanding at the end of the
period. The above-noted deficit capital accounts will result, through the
duration of the Partnership, in net gain for financial reporting and
Federal income tax purposes to the General Partners and Limited Partners.

The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.

No provision for Federal or state income taxes has been made as the
liability for such taxes is that of the partners rather than the
Partnership.

Certain amounts in the 2001 financial statement have been reclassified
to conform with the 2002 presentation.

INVESTMENT IN UNCONSOLIDATED VENTURE

In December 1983, the Partnership acquired an interest in 245 Park,
which owned a 46-story office building located at 245 Park Avenue, New
York, New York. The Partnership acquired its approximate 48.25% ownership
interest in 245 Park for approximately $63,927,000 from an affiliate of the
joint venture partners. In addition to the Partnership, the other partners
(the "O&Y partners") of 245 Park included Olympia & York 245 Park Ave.
Holding Company, L.P., Olympia & York Equity Company, L.P., and Olympia &
York 245 Corp., all of which were affiliates of Olympia & York
Developments, Ltd. ("O&Y").

As a result of the financial difficulties of the O&Y partners, in
October 1995 each of the O&Y partners and certain other O&Y affiliates (but
not the Joint Venture) filed for bankruptcy protection from creditors under
Chapter 11 of the United States Bankruptcy Code. During 1996, the O&Y
partners and these certain other O&Y affiliates restructured their
ownership interests in various office buildings, including their interest
in the 245 Park Avenue office building. In connection with such
restructuring, 245 Park filed for bankruptcy under Chapter 11 of the United
States Bankruptcy Code in April 1996 seeking approval of a plan of
reorganization by its creditors and the partners of 245 Park, including the
Partnership, and in August 1996, the Third Amended Joint Plan of
Reorganization and Disclosure Statement (the "Plan") was filed with the
Bankruptcy Court. The Plan was accepted by the various classes of claims
and equity holders and confirmed by the Court on September 20, 1996. The
Plan became effective on November 21, 1996 ("Effective Date") upon
completion of several additional steps. The conditions to the Plan
included, but were not limited to, the completion of significant
refinancing and capital transactions regarding the 245 Park Avenue office
building as well as other properties. Pursuant to the terms of the Plan,
the Partnership owned through 245 Park Holding an approximate 5.4% general
partner interest (slightly diluted from the original ownership percentage
by notes converted to equity) in a newly formed partnership, BFP, LP,
represented by 5,673.751 Class A Units. The managing general partner of
BFP, LP is an entity affiliated with certain O&Y creditors and the
proponents of the Plan governing the restructuring. BFP, LP's principal
assets currently are wholly-owned or majority and controlling interests in
nine office buildings (including the 245 Park Avenue office building).

In conjunction with the restructuring, the Partnership entered into
the JMB Transaction Agreement dated November 21, 1996, whereby the
Partnership was entitled to receive one-third of the monthly management
fees earned at the 245 Park Avenue property through December 2001. Amounts
received were not to be less than $400,000 or exceed $600,000 for any
twelve month period and were not to be less than $2,300,000 over the term
ending December 31, 2001. The Partnership's right to receive such fees has
expired and all such amounts were received. For the twelve months ended
December 31, 2001, the Partnership earned approximately $599,000 of
management fees pursuant to the agreement. In addition, pursuant to the
JMB Transaction Agreement, the Partnership had the right, except under
certain circumstances, to prohibit (i) a sale of the 245 Park Avenue
property prior to January 2, 2000 and (ii) a reduction of the indebtedness
secured by the 245 Park Avenue property below a certain level prior to
January 2, 2003. A reduction in a large amount of such indebtedness or a
sale of the 245 Park Avenue property would result in the recognition by the
Partnership (and the Holders of Interests) of substantial gain for Federal
income tax purposes without a significant amount of proceeds from such
transaction. During 2001, the debt secured by the 245 Park Avenue property
was refinanced with a new mortgage obligation in the principal amount of
$500 million. There were no refinancing proceeds distributed to the
Partnership.

The Partnership and its lender had reached a modification and
extension agreement regarding the former $50,000,000 term loans that
matured in October 1993. These term loans (described below) were secured
by the Partnership's interest in its real estate investment, and
$25,000,000 of the term loans was guaranteed by JMB Realty Corporation
("JMB"). The terms of the modification and extension generally provided
for (i) an extension period through December 1998; (ii) one-half of the
principal amount of the term loans required interest to be paid currently
at a rate related to either the London Interbank Offer Rate (LIBOR) or the
prime rate while interest on the balance of the term loans accrued at an
annual rate of 2% compounded annually; (iii) the term loan bearing interest

at a rate related to either LIBOR (the "LIBOR Note") or the prime rate was
subject to periodic amortization; and (iv) the past due lump sum interest
swap payment in the amount of $2,194,631 was converted to a note payable
which was due December 1998 with interest accruing at an annual rate of 2%
compounded annually. Payments of principal and interest made by JMB under
its guaranty of the $25,000,000 portion of the Partnership's term loans
were treated as advances to the Partnership. Interest accrued on these
advances at the annual rate of prime (as such prime rate changed from time
to time) plus 1% (5.25% at December 31, 2002). As of December 31, 2002,
JMB had advanced approximately $12,376,000, evidenced by a demand note,
which included the principal and interest payments made related to the loan
modification discussed above and advances to pay operating costs of the
Partnership. This demand note payable to JMB was secured by the
Partnership's interest in BFP, LP. The Partnership made payments to JMB of
$400,000 during 2001 for interest payable on this demand note. As
discussed below, on December 31, 2002, the Partnership paid to JMB the
demand note balance and accrued interest of approximately $16,765,000 and
reversed previously accrued interest of approximately $3,675,000.

In July 1995, JMB purchased from the lenders the term loans (including
the note representing the interest swap payment) and their security
interests in the related collateral, including the JMB guarantee, which was
terminated. JMB continued to hold the notes for these loans generally
under the same terms and conditions that were in effect prior to the
purchase. However, no scheduled principal payments were required prior to
the scheduled maturity of the LIBOR Note. Interest on the LIBOR Note was
payable monthly at a floating rate which, at the option of the Partnership,
was related to either LIBOR or the prime rate of Bank of America. Through
December 31, 2000, no payments of interest on the LIBOR Note had been made
subsequent to July 31, 1995, and unpaid interest at the applicable interest
rate (including the default interest rate for the period from December 31,
1998, as discussed below) accrued and compounded monthly. The scheduled
maturity of the term loans was December 31, 1998. However, JMB did not
pursue any remedies under these notes as a result of the non-payment of
monthly interest under the LIBOR Note or the maturity of the term loan
notes.

Effective January 3, 2001, the Partnership and JMB agreed to extend
the maturity date of the term loan notes from December 31, 1998 to
January 2, 2006 and otherwise to follow literally the various terms of the
notes. As a result, the parties agreed that the Partnership would be
required to pay default interest on each of the three term loan notes (at
the prime rate plus 3% per annum) for the period from the maturity date of
December 31, 1998 to January 3, 2001, the effective date on which JMB and
the Partnership agreed to extend each of the notes. Accordingly,
incremental interest cost relating to the default interest rate aggregating
approximately $7.7 million was recorded as expense in the year ended
December 31, 2000. Under the extended notes, interest accrued under the
same terms as applicable to the term loan notes prior to December 31, 1998.

Interest was due and payable monthly on the LIBOR Note with the outstanding
principal due and payable on January 2, 2006. All principal and accrued
and compounded interest on the other term loan notes (including the note
representing the interest rate swap payment) were due and payable on
January 2, 2006. Further, all outstanding interest as of December 31, 2000
on the LIBOR Note (approximately $10.8 million) was due and payable
immediately. In 2001, the Partnership issued a new demand note payable to
JMB, bearing interest at the prime rate (as such prime rate changes from
time to time) plus 1% (5.25% at December 31, 2002) per annum with interest
accruing and compounding quarterly. Through December 31, 2002, JMB had
advanced approximately $12,903,000 to the Partnership pursuant to the new
demand note. The Partnership used the advances to pay the outstanding
interest on the LIBOR Note through December 31, 2001 of approximately
$12,240,000 and to pay accrued interest on the LIBOR Note from January 1,
2002 through December 31, 2002 of approximately $663,000. As discussed
below, on December 31, 2002, the Partnership repaid to JMB the new demand
note balance, including accrued interest, of approximately $14,267,000. In
addition, the Partnership repaid to JMB the LIBOR note balance, including
accrued interest, of approximately $16,098,000 and repaid to JMB approxi-
mately $8,418,000 including principal and accrued interest on the other two
term loan notes. The Partnership also reversed previously accrued interest
of approximately $483,000 on one of the term loan notes.

The Partnership's interest in BFP, LP was pledged as collateral for
the term loan notes and demand notes (collectively (the "JMB Notes") which
aggregated approximately $89,337,000 in principal and interest at
December 31, 2002 (prior to repayment) to JMB. The security agreements for
the JMB Notes required mandatory payment of principal and interest out of
any net proceeds received upon the sale, refinancing or other disposition
of, or any distribution made with respect to, the Partnership's interest in
BFP, LP.

On December 31, 2002 (the "Redemption Date") 245 Park Holding entered
into a redemption agreement (the "Partial Redemption") by and among 245
Park Holding, WFP, GP and BFP, LP pursuant to which 245 Park Holding
transferred and BFP, LP thereby redeemed 5,106.376 Class A Units from 245
Park Holding, or 90% of its approximate 5.4% interest, (the "Redeemed
Interest") in BFP, LP and 245 Park Holding received a distribution of
approximately $56,109,000 (the "Redemption Distribution"). 245 Park
Holding's remaining interest in BFP, LP consists of 567.375 Class A Units
(the "Retained Interest"). In accordance with the 245 Park Holding limited
liability company agreement, 245 Park Holding distributed approximately
$55,548,000 (99% of the Redemption Distribution) to the Partnership and
approximately $561,000 (1% of the Redemption Distribution) to WFP, GP. The
Partnership received its share of the Redemption Distribution on the
Redemption Date and in accordance with the security agreements relating to
the JMB Notes, the Partnership then paid to JMB approximately $55,548,000
as repayment toward the JMB Notes. The Partnership reversed previously
accrued interest of approximately $4,158,000 and accordingly, four of the
five notes outstanding were retired. The unpaid principal and accrued
interest balance on the remaining JMB Note at December 31, 2002, was
approximately $29,631,000. Interest on the remaining JMB Note accrues at a
rate of 2% per annum and is compounded annually. The remaining JMB Note is
secured by the Partnership's interest in BFP, LP.

The Partnership recognized a net gain of approximately $79,194,000 on
the Partial Redemption for financial reporting purposes. No gain was
recognized by the Partnership for Federal income tax purposes.

BFP, LP has a substantial amount of indebtedness outstanding. If any
of the buildings in which BFP, LP has an interest are sold, any proceeds
would be first applied to repayment of the mortgage and other indebtedness
of BFP, LP. In any event, any net proceeds obtained by the Partnership
could then be available to satisfy the remaining JMB Note. Only after such
applications would any remaining proceeds be available to be distributed to
the Holders of Interests. Similarly, in the event of a sale or other
disposition of the Retained Interest (including a redemption), the proceeds
of such sale or disposition would be available to satisfy the remaining JMB
Note . Only after such application would remaining proceeds, if any, be
available to be distributed to the Holders of Interests.

It is unlikely that the Holders of Interests ever will receive any
significant portion of their original investment. However, it is expected
that Holders of Interests will be allocated a substantial amount of gain
for Federal income tax purposes as a result of one or more transactions
which may occur over the remaining term of the Partnership. These
transactions include (i) a full or partial sale or other disposition of the
245 Park Avenue property or other properties in which BFP, LP owns an
interest; (ii) a sale or other disposition of the Partnership's interest in
BFP, LP; or (iii) a significant reduction in the indebtedness of the 245
Park Avenue property or other indebtedness of the Partnership for Federal
income tax purposes. Moreover, none of these potential transactions is
expected to result in Holders of Interests receiving any significant cash
distributions. The amount of gain for Federal income tax purposes to be
allocated to a Holder of Interests over the remaining term of the
Partnership is expected to be, at a minimum, equal to all or most of the
amount of such Holder's deficit capital account for tax purposes. Such
gain may be offset by suspended losses from prior years (if any) that have

been allocated to the Holder of Interests. The actual tax liability of
each Holder of Interests will depend on such Holder's own tax situation.

The Partnership's future liquidity and ability to continue as a going
concern is dependent upon additional advances from JMB and there is no
assurance that such advances will be made.

NOTES PAYABLE TO AN AFFILIATE

Notes payable to an affiliate consist of the following at December 31,
2002 and 2001:
2002 2001
----------- -----------
Note payable (term loan) bearing
interest at a variable rate related
to LIBOR plus 2.625% (4.064% per annum
at December 31, 2002); secured by the
Partnership's interest in BFP, LP;
interest payable monthly with unpaid
interest accruing and compounding
monthly; scheduled maturity was
December 31, 1998; extended,
effective January 3, 2001, to
January 2, 2006, paid in full and
retired on December 31, 2002 . . . . . $ -- 16,042,000

Note payable (term loan) bearing
interest at 2% per annum, compounded
annually; secured by the Partnership's
interest in BFP, LP; no payments until
December 1998 when the entire principal
amount and accrued compounded interest
were scheduled to be due (as discussed
above); extended, effective January 3,
2001, to January 2, 2006 . . . . . . . 25,000,000 25,000,000

Note payable (term loan) bearing
interest at 2% per annum, compounded
annually; secured by the Partnership's
interest in BFP, LP; no payments
until December 1998 when the entire
principal amount and accrued
compounded interest were scheduled to
be due (as discussed above); extended,
effective January 3, 2001, to
January 2, 2006, paid in full and
retired on December 31, 2002 . . . . . -- 2,194,631

Demand note payable bearing
interest at prime plus 1% (5.25%
per annum at December 31, 2002);
advanced by JMB; maximum principal
sum of a specified amount, secured
by the Partnership's interest in
BFP, LP, paid in full and retired
on December 31, 2002 . . . . . . . . . -- 12,375,591

Demand note payable bearing
interest at prime plus 1%
(5.25% per annum at December 31,
2002); advanced by JMB, maximum
principal sum of a specified
amount, secured by the Partner-
ship's interest in BFP, LP, paid
in full and retired on December 31,
2002 . . . . . . . . . . . . . . . . . -- 12,240,392
----------- -----------
$25,000,000 67,852,614
=========== ===========

Accrued and unpaid interest due affiliates was $4,631,375 and
$18,654,891 at December 31, 2002 and 2001, respectively.

PARTNERSHIP AGREEMENT

Pursuant to the terms of the Partnership Agreement, net profits and
losses of the Partnership from operations are generally allocated 94% to
the Holders and 6% to the General Partners. Profits from the sale or other
disposition of all or substantially all of the Partnership's interest in
BFP, LP or of all or substantially all of the 245 Park Avenue office
building or other real property owned by BFP, LP will be allocated to the
General Partners in an amount equal to the greater of 1% of such profits or
any cash from the proceeds of such sale or other disposition distributed to
the General Partners, plus an additional amount of such profits to
eliminate deficits, if any, in the General Partners' capital accounts. The
remainder of such profits will be allocated to the Holders. All losses
from the sale of all or substantially all of the Partnership's interest in
BFP, LP or of all or substantially all of the 245 Park Avenue office
building or other real property owned by BFP, LP will be allocated 99% to
the Holders and 1% to the General Partners. All such profits or losses
will be allocated among the Holders in proportion to the number of
Interests held. For Federal income tax purposes, all interest expense
recognized on the JMB Notes is allocated to a General Partner of the
Partnership.

The General Partners are not required to make any additional capital
contributions except under certain limited circumstances upon dissolution
and termination of the Partnership. Distributions of "Distributable Cash"
(as defined) of the Partnership generally will be made 94% to the Holders
of Interest and 6% to the General Partners. Distributions of "Sale
Proceeds" or "Financing Proceeds" (as defined) will be made first to the
Holders in an amount equal to their contributed capital, next to the
General Partners in an amount equal to their capital contributions, and the
balance 70% to the Holders and 30% to the General Partners. Distributions
would be made to the General Partners and Holders of Interests generally
only after the satisfaction of all Partnership liabilities.

TRANSACTIONS WITH AFFILIATES

The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Corporate General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's real property investments. Fees,
commissions and other expenses required to be paid by the Partnership to
the General Partners and their affiliates as of December 31, 2002, 2001 and
2000 are as follows:

UNPAID AT
DECEMBER 31,
2002 2001 2000 2002
------- ------ ------ ------------

Insurance commissions . . . $ -- -- 563 --
Reimbursement (at cost)
for legal services . . . . 6,920 9,613 4,676 --
Reimbursement (at cost)
for portfolio management
services . . . . . . . . . 42,746 2,673 3,768 3,963
Reimbursement (at cost)
for out-of-pocket
expenses . . . . . . . . . 1,213 -- -- --
------- ------ ------ ------
$50,879 12,286 9,007 3,963
======= ====== ====== ======

Any reimbursable amounts currently payable to the General Partners and
their affiliates do not bear interest.

Reference is made to the Notes, "Investment in Unconsolidated Venture"
and "Notes Payable to an Affiliate" above for a discussion of certain loans
and notes payable by the Partnership to JMB and related collateral held by
JMB.

SUMMARY FINANCIAL INFORMATION OF UNCONSOLIDATED VENTURE

Summary financial information for BFP, LP as of and for the years
ended December 31, 2002 and 2001:

2002 2001
----------- -----------
(000's) (000's)
Assets:
Commercial properties . . . . . . . . $ 3,035,552 2,930,857
Other assets. . . . . . . . . . . . . 865,374 856,670
----------- -----------
Total assets . . . . . . . . . . . $ 3,900,926 3,787,527
=========== ===========

Liabilities and Partners' Capital:
Accounts payable and other
liabilities . . . . . . . . . . . . $ 98,053 83,290
Long term debt. . . . . . . . . . . . 2,767,308 2,705,777
Venture Partners' equity. . . . . . . 1,029,790 944,057
----------- -----------
Total liabilities. . . . . . . . . $ 3,895,151 3,733,124
=========== ===========
Partnership's capital. . . . . . . $ 5,775 54,403
=========== ===========

Represented by:
Invested capital. . . . . . . . . . . $ 31,725 31,725
Units retired / transferred . . . . . (54,285) (610)
Cumulative net earnings . . . . . . . 28,335 23,288
----------- -----------
$ 5,775 54,403
=========== ===========

Total income. . . . . . . . . . . . . . $ 464,532 513,422
Expenses. . . . . . . . . . . . . . . . 371,495 392,739
----------- -----------
Net income before extraordinary item. . 93,037 120,683

Loss on early extinguishment of debt. . -- (31,483)
----------- -----------
Net income. . . . . . . . . . . . . . . $ 93,037 89,200
=========== ===========
Partnership's share:
Equity in earnings of BFP, LP . . . . $ 5,047 4,836
----------- -----------
$ 5,047 4,836
=========== ===========

BFP, LP adopted fresh start accounting in connection with the
restructuring, which resulted in the restatement of all of its assets and
liabilities to reflect their reorganization value. Through the Redemption
Date, the Partnership amortized the difference between its historical basis
in 245 Park and its underlying equity (which was transferred to the basis
in BFP, LP on the Effective Date) over a period not to exceed forty years.
The amortization for the years ended December 31, 2002, 2001 and 2000 was
$2,455,143, $2,455,143 and $2,455,143, respectively. On the Redemption
Date the Partnership's interest in BFP, LP was reduced to less than 1%. As

a consequence, the Partnership has discontinued the application of the
equity method of accounting, recorded its investment at zero and will no
longer recognize its share of earnings or losses from BFP, LP. The
Partnership has no obligation to make future contributions to BFP, LP.

The total income, expenses and net income for the year ended
December 31, 2000 were $514,729,000, $427,921,000, and $86,808,000,
respectively.

SUPPLEMENTARY QUARTERLY DATA (UNAUDITED)

2002
----------------------------------------------
At 3/31 At 6/30 At 9/30 At 12/31
---------- ---------- ---------- ----------
Total income. . . . . . $ 2,164 1,821 1,532 1,120
========== ========== ========== ==========
Earnings (loss) before
gain on redemption
of interest in
BFP, LP. . . . . . . . $1,014,331 1,343,277 1,193,954 4,955,719
Gain on redemption of
Partnership's interest
in BFP, LP (net of
venture partner's
share of gain) . . . . -- -- -- 79,193,697
---------- ---------- ---------- ----------
Net earnings
(loss). . . . . . $1,014,331 1,343,277 1,193,954 84,149,416
========== ========== ========== ==========
Net earnings (loss)
per Interest:
Earnings (loss)
before gain on
redemption of
interest in BFP,
LP . . . . . . . . . $ 958 1,269 1,128 4,747
Gain on redemption of
Partnership's
interest in BFP,
LP (net of
venture partner's
share of gain) . . . -- -- -- 79,434
---------- ---------- ---------- ----------
Net earnings
(loss) per
Interest. . . . . $ 958 1,269 1,128 84,181
========== ========== ========== ==========

2001
----------------------------------------------
At 3/31 At 6/30 At 9/30 At 12/31
---------- ---------- ---------- ----------
Total income. . . . . . $ 145,425 149,085 163,101 152,023
========== ========== ========== ==========
Net earnings (loss) . . $2,603,109 885,711 (494,109) 984,061
========== ========== ========== ==========
Net earnings (loss)
per Interest . . . . . $ 2,459 837 (467) 930
========== ========== ========== ==========

On December 31, 2002, 245 Park Holding (in which the Partnership has a
99% interest) entered into a transaction whereby 90% of 245 Park Holding's
interest in BFP, LP was redeemed. As a result of the partial redemption,
the Partnership recognized $79,193,697 of net gain for financial reporting
purposes in the fourth quarter of 2002.

On December 31, 2002, in conjunction with the partial redemption
described above, the Partnership repaid to JMB the balances outstanding on
four of the five JMB Notes outstanding. In addition, the Partnership
reversed previously accrued interest of approximately $4,158,000, which is
included in earnings (loss) before gain on redemption of interest in BFP,
LP at December 31, 2002.

During 2001, BFP, LP sold a 49% limited partnership interest in the
entities that own the 53 State Street and 75 State Street office buildings
to an institutional investor. The Partnership recognized its share of the
gain relating to the sale during the first quarter of 2001.

During 2001, BFP, LP refinanced its mortgage obligation for 245 Park
Avenue and accordingly, repaid the existing loans secured by the property.
The Partnership recognized its share of the losses relating to prepayment
penalties and other costs associated with repayment of the loans during the
third quarter of 2001.

INDEPENDENT AUDITORS' REPORT

To the Partners of
Brookfield Financial Properties, L.P.
New York, New York

We have audited the accompanying consolidated balance sheet of
Brookfield Financial Properties, L.P. and subsidiaries (the Company) as of
December 31, 2002, and the related consolidated statements of operations,
partners' capital and cash flows for the year then ended. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the consolidated financial statements. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.

In our opinion, such consolidated financial statements present fairly,
in all material respects, the financial position of Brookfield Financial
Properties, L.P. and subsidiaries as of December 31, 2002, and the results
of their operations and their cash flows for the year then ended in
conformity with accounting principles generally accepted in the United
States of America.

/s/ Deloitte & Touche LLP

March 21, 2003

BROOKFIELD FINANCIAL PROPERTIES, L.P.

CONSOLIDATED BALANCE SHEET

DECEMBER 31, 2002
(000's)

ASSETS

Commercial properties, net. . . . . . . . . . . . . . $ 3,035,552

Cash and cash equivalents (including
restricted cash and cash equivalents of
$53,394). . . . . . . . . . . . . . . . . . . . . . 60,417
Restricted treasury bills . . . . . . . . . . . . . . 256,018
Accounts receivable . . . . . . . . . . . . . . . . . 95,820
Deferred rent receivable. . . . . . . . . . . . . . . 113,108
Deferred costs, net . . . . . . . . . . . . . . . . . 106,784
Loan to affiliate . . . . . . . . . . . . . . . . . . 118,875
Other assets. . . . . . . . . . . . . . . . . . . . . 114,352
----------

Total Assets. . . . . . . . . . . . . . . . . . . . . $3,900,926
==========

LIABILITIES AND PARTNERS' CAPITAL

Long term commercial property debt. . . . . . . . . . $2,767,308
Accounts payable and other payables . . . . . . . . . 98,053
----------

2,865,361

Partners' capital . . . . . . . . . . . . . . . . . . 1,035,565
----------

Total Liabilities and Partners' Capital . . . . . . . $3,900,926
==========

See notes to consolidated financial statements.

BROOKFIELD FINANCIAL PROPERTIES, L.P.

CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 2002
(000's)

INCOME:
Rental income . . . . . . . . . . . . . . . . . . . $ 332,683
Escalation income and expense reimbursement
revenue . . . . . . . . . . . . . . . . . . . . . 64,331
Equity earnings from joint venture. . . . . . . . . 20,029
Interest and other income . . . . . . . . . . . . . 47,489
----------

464,532
----------

EXPENSES:
Property operations . . . . . . . . . . . . . . . . 132,877
Interest. . . . . . . . . . . . . . . . . . . . . . 167,483
Administrative and development. . . . . . . . . . . 12,833
Depreciation and amortization . . . . . . . . . . . 58,302
----------

371,495
----------

NET INCOME. . . . . . . . . . . . . . . . . . . . . . $ 93,037
==========

See notes to consolidated financial statements.

BROOKFIELD FINANCIAL PROPERTIES, L.P.

CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL

FOR THE YEAR ENDED DECEMBER 31, 2002
(000's)

Balance Units Balance
January 1, Net Retired/ December 31,
2002 Income Transferred 2002
----------- ------- ----------- ------------

GENERAL PARTNERS

Brookfield Financial
Properties, Inc.. . $ 10,044 $ 937 $ (21) $ 10,960

JMB 245 Park Avenue
Holding Company,
LLC . . . . . . . . 54,403 5,047 (53,675) 5,775

LIMITED PARTNERS

Brookfield Proper-
ties Corporation:
Brookfield Pro-
perties Holdings,
Inc. . . . . . . . 407,606 38,017 (830) 444,793
Olympia & York
Tower B Company. . 79,242 7,378 (162) 86,458
Battery Park
Partners . . . . . 385,493 35,954 (774) 420,673
BFP II LLC. . . . . 52,246 4,858 (115) 56,989

Other . . . . . . . . 9,426 846 (355) 9,917
-------- ------- -------- ----------

$998,460 $93,037 $(55,932) $1,035,565
======== ======= ======== ==========

See notes to consolidated financial statements.

BROOKFIELD FINANCIAL PROPERTIES, L.P.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED DECEMBER 31, 2002
(000's)

OPERATING ACTIVITIES:
Net income. . . . . . . . . . . . . . . . . . . . . $ 93,037
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization . . . . . . . . . . 58,302
Equity earnings from joint ventures . . . . . . . (20,029)
Accrued interest income . . . . . . . . . . . . . (9,798)
Accrued interest expense. . . . . . . . . . . . . 7,350
Increase in deferred rent receivable. . . . . . . (1,095)
Changes in other operating assets and liabilities:
Decrease in restricted cash . . . . . . . . . . 81,837
Increase in accounts receivable . . . . . . . . (46,207)
Decrease in other assets. . . . . . . . . . . . 9,775
Decrease in accounts payable and other liabilities (16,364)
---------
NET CASH PROVIDED BY OPERATING ACTIVITIES . . 156,808
---------

INVESTING ACTIVITIES:
Additions to commercial properties. . . . . . . . . (346,885)
Repayments of loan from affiliate . . . . . . . . . 176,100
Distributions from joint ventures . . . . . . . . . 16,960
Other assets. . . . . . . . . . . . . . . . . . . . (31,438)
---------
NET CASH USED IN INVESTING ACTIVITIES . . . . (185,263)
---------

FINANCING ACTIVITIES:
Additions to long term debt . . . . . . . . . . . . 100,000
Repayments of long term debt. . . . . . . . . . . . (44,606)
Redemption of restricted treasury bills . . . . . . 20,299
Equity units retired. . . . . . . . . . . . . . . . (55,932)
---------
NET CASH PROVIDED BY FINANCING ACTIVITIES . . 19,761
---------

Decrease in cash and cash equivalents . . . . . . . . (8,694)
Cash and cash equivalents - beginning of year . . . . 15,717
---------

Cash and cash equivalents - end of year . . . . . . . $ 7,023
=========

See notes to consolidated financial statements.

BROOKFIELD FINANCIAL PROPERTIES, L.P. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2002
(000'S)

1. ORGANIZATION

Brookfield Financial Properties, L.P. (the Company) is a Delaware
limited partnership organized by and among Brookfield Financial
Properties, Inc., a subsidiary of Brookfield Properties Holdings,
Inc., a Delaware corporation, as a general partner, JMB 245 Park
Avenue Holding Company, LLC, as a general partner, (JMB) and
Brookfield Properties Holdings, Inc., Olympia & York Tower B Company,
BFP II LLC, and Battery Park Partners (which are subsidiaries of
Brookfield Properties Corporation and are collectively referred to as
BPHI), and various other partners as limited partners. Pursuant to
the Redemption Agreement dated December 31, 2002 between the Company
and JMB, the Company redeemed 5,106.376 Class A partnership units for
consideration of approximately $56,000 and simultaneously executed
the Fourth Restated Partnership Agreement.

2. SIGNIFICANT ACCOUNTING POLICIES

a. BASIS OF PRESENTATION

(i) The consolidated financial statements include the
accounts of the Company and all of its subsidiaries, as
well as joint ventures and partnerships which the Company
controls, after elimination of intercompany accounts and
transactions.

(ii) The Company accounts for its investments in joint
ventures and partnerships in which it does not have a
controlling interest under the equity method.

b. COMMERCIAL PROPERTIES

Land, building and improvements and tenant improvements are
carried at cost, subject to impairment evaluation. Included in
commercial properties is real estate under development which is
carried at cost. Interest, property taxes, insurance incurred
during the development period and direct project costs such as
design, construction, legal, development fees, and project
administration are capitalized as property costs. Capitalized
carrying costs, consisting primarily of interest and property
taxes, aggregated $65,500 for the year ended December 31, 2002,
including interest of approximately $20,800.

c. DEPRECIATION AND AMORTIZATION

Depreciation of office buildings and improvements is provided
on the straight-line method over the lives of the buildings
which management has estimated to range from 38 to 50 years.
Amortization of tenant improvements and other leasing costs is
provided on the straight-line method over the terms of the
related leases.

d. DEFERRED COSTS

Direct financing costs incurred relating to obtaining mortgage
financing are deferred and amortized over the term of the
mortgage payable. Direct costs (leasing commissions) incurred
relating to leasing activities are deferred and amortized on a
straight-line basis over the terms of the related leases. At
December 31, 2002, the accumulated amortization on the deferred
costs is $20,084.

e. INCOME TAXES

The Company, as a partnership, is not subject to Federal, state
and local income taxes, with the exception of certain corporate
subsidiaries. Accordingly, the Company makes no provision for
income taxes in its consolidated financial statements except
for the aforementioned corporate subsidiaries, where income
taxes are provided as required. The Company's taxable income
or loss, excluding the taxable income or loss of the corporate
subsidiaries, is reportable by the partners.

f. CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments that have
original maturities of three months or less to be cash
equivalents.

Restricted cash principally represents amounts which are
restricted pursuant to the terms of certain loan agreements.

g. FINANCIAL INSTRUMENTS

Statement of Financial Accounting Standards No. 107
"Disclosures About Fair Value of Financial Instruments"
requires disclosures of fair values of financial instruments
for which it is practicable to estimate that value. Based on
available market information, the Company estimates that the
fair value of its financial assets and liabilities approximates
their carrying value.

h. USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
of America ("GAAP") requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported
amounts of revenues and expenses during the reported period.
Actual results could differ from those estimates.

i. RENTAL INCOME

Rental income from leases providing for periodic increases in
base rent is recognized on a straight-line basis over the
noncancellable term of the respective leases.

j RECENT ACCOUNTING PRONOUNCEMENTS

On January 1, 2002, the Company adopted SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived
Assets". SFAS 144 supercedes existing accounting literature
dealing with impairment and disposal of long-lived assets,
including discontinued operations. It addresses financial
accounting and reporting for the impairment of long-lived
assets and for long-lived assets to be disposed of, and expands
current reporting for discontinued operations to include
disposals of a "component" of an entity that has been disposed
of or is classified as held for sale. The adoption of this
Interpretation did not have an impact on the financial
statements of the Company.

In November of 2002, the FASB issued Interpretation No. 45,
"Guarantors' Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Indebtedness of
Others". The Interpretation elaborates on the disclosures to
be made by a guarantor in its financial statements about its
obligations under certain guarantees that it has issued. It
also clarifies that a guarantor is required to recognize, at
the inception of a guarantee, a liability for the fair value of
the obligation undertaken in issuing the guarantee. This
Interpretation does not prescribe a specific approach for
subsequently measuring the guarantor's recognized liability
over the term of the related guarantee. The disclosure
provision of this Interpretation are effective for the
Company's December 31, 2002 financial statements; the Company
has no guarantees requiring disclosure under this
Interpretation. The initial recognition and initial measurement
provisions of this Interpretation are applicable on a
prospective basis to guarantees issued or modified after
December 31, 2002. The Company does not anticipate that the
adoption of this Interpretation will have an impact on the
consolidated financial statements.

In January of 2003, the FASB issued Interpretation No. 46,
"Consolidation of Variable Interest Entities". This Interpre
tation clarifies the application of existing accounting
pronouncements to certain entities in which equity investors do
not have the characteristics of a controlling financial
interest or do not have sufficient equity at risk for the
entity to finance its activities without additional
subordinated financial support from other parties. The
provisions of the Interpretation will be immediately effective
for all variable interests in variable interest entities
created after January 31, 2003, and the Company will need to
apply its provisions to any existing variable interests in
variable interest entities by no later than December 31, 2004.
The Company does not anticipate that the adoption of this
Interpretation will have an impact on the consolidated
financial statements.

3. COMMERCIAL PROPERTIES

DESCRIPTION

The Company, through its subsidiaries and joint ventures, is
primarily involved in the operation and development of commercial
real estate located in New York City and Boston. The Company's
tenants are principally large financial and professional service
institutions. The properties owned by the Company, in whole or in
part, are as follows:

NEW YORK CITY BOSTON
------------- ------

World Financial Center - Tower A 53 State Street
World Financial Center - Tower B 75 State Street
World Financial Center - Tower C
World Financial Center - Tower D
245 Park Avenue
One Liberty Plaza
300 Madison Avenue

These properties aggregate approximately 14.1 million square feet.
The properties which are wholly owned at December 31, 2002 are World
Financial Center Towers A and B, 245 Park Avenue, One Liberty Plaza
and 300 Madison Avenue, a property currently under development
expected to be completed in 2003.

The Company acquired its interest in World Financial Center Tower C
in September 2002. The interest represents a 51.5% tenancy in common
interest in the property with remaining 48.5% tenancy in common
interest held by a subsidiary of American Express Company. The
Company's interest of the property is currently being redeveloped,
with major occupancy expected by 2004.

Properties which are not consolidated as a result of the Company
sharing control with its joint venture partners include Tower D,
which is held 51% by the Company and 49% by an affiliate of Merrill
Lynch & Co. ("Merrill Lynch") and 53 State Street and 75 State
Street, which are held 51% by the Company and 49% by an affiliate of
Deutsche Bank.

Included in Commercial Properties at December 31, 2002 are
consolidated operating commercial properties of $2,369,341, real
estate under development of $430,444 and joint venture investments of
$235,767.

CONSOLIDATED COMMERCIAL PROPERTIES:

The Company's consolidated operating commercial properties (including
the tenancy in common interest owned in World Financial Center -
Tower C) at December 31, 2002 are as follows:

Land . . . . . . . . . . . . . . . $ 348,179
Buildings and improvements . . . . 2,330,317
Accumulated depreciation
and amortization . . . . . . . . (309,155)
----------
Total. . . . . . . . . . . . . $2,369,341
==========

JOINT VENTURES - COMMERCIAL PROPERTY:

The condensed balance sheet and condensed statement of operations of
the Company's partially owned properties, in which the Company has a
joint venture investment, at and for the year ended December 31, 2002
is as follows:

BALANCE SHEET

ASSETS
Commercial property. . . . . . . $1,116,838
Other assets . . . . . . . . . . 137,506
----------
Total assets . . . . . . . . . . $1,254,344
==========

LIABILITIES
Long term debt . . . . . . . . . $ 755,128
Accounts payable and other . . . 7,897
----------
Total liabilities. . . . . . . . 763,025
----------

PARTNER'S CAPITAL
Brookfield Financial
Properties, L.P. . . . . . . . 235,767
Co-venturers . . . . . . . . . . 255,552
----------
491,319
----------
Total liabilities and
partner's capital. . . . . . . $1,254,344
==========

STATEMENT OF OPERATIONS

Revenues . . . . . . . . . . . . . $ 180,695
Operating expenses . . . . . . . . (113,116)
Deprecation and amortization . . . (29,019)
----------
Net income . . . . . . . . . . . . $ 38,560
==========

4. LONG TERM DEBT

Long term debt secured by mortgages and other security interests
which are collateralized by commercial properties carries a weighted
average interest rate of 7.0% at December 31, 2002. Cash paid for
interest on long term debt obligations for the year ended
December 31, 2002 aggregated approximately $160,000.

In 2001, the Company entered into a new mortgage loan for One Liberty
Plaza in the principal amount of $432,000, and purchase treasury
bills of approximately $295,000 which were transferred to a trust to
service the existing debt and are classified as restricted. The
defeasance did not meet the requirement of a defeasance under GAAP.

In addition, included in long term debt is subordinated long term
debt of $65,400 which represents the net carrying value of a zero
coupon note (the Note) payable by WFP Tower B Co., L.P. (the
Partnership), a subsidiary of the Company, upon its maturity on
October 1, 2014. The Note carries a face principal amount of
$150,000 (the Face Principal Amount). On maturity the Partnership
will pay the Face Principal Amount and, if any, the Maturity
Contingent Principal Amount (together, the Maturity Stated Principal
Amount). The Maturity Contingent Principal Amount is the lesser of
(a) 25% of the amount by which Tower B fair market value at maturity
exceeds $600,000 and (b) $517,298. In lieu of paying in cash the
Maturity Stated Principal Amount, the Partnership may elect to
deliver to the lender a 25% interest in the building located at
Parcel B at the World Financial Center (the Equity Interest),
provided that the fair market value of the building, taking into
account the then outstanding principal indebtedness secured by the
leasehold interest in the building, is at least $600,000. However,
if the lender elects to receive cash instead, then the Partnership
has to repay the Maturity Stated Principal Amount and not deliver the
Equity Interest. The carrying amount of this Note represents the
current value of the Note based upon the estimated residual value of
the building discounted at 9.0%.

The Company has a mortgage note payable maturing on November 21, 2003
in the amount of $401,800. The Company is currently negotiating a
mortgage with a new lender which it anticipates will close prior to
November 21, 2003.

The scheduled repayments of long term debt at December 31, 2002 are
as follows:

Years ending December 31, 2003 . . . . $ 458,278
2004. . . . . 68,136
2005. . . . . 73,179
2006. . . . . 77,349
2007. . . . . 321,135
Thereafter. . 1,769,231
----------
$2,767,308
==========

5. RENTALS UNDER OPERATING LEASES

Rental revenues are derived from the leasing of space in the
buildings to commercial and retail tenants. The leases are for fixed
terms of varying length and generally provide for annual rentals and
expense escalations to be paid in monthly installments. Included in
interest and other income is approximately $18,921 of income derived
from early termination of operating leases.

The following is a schedule of minimum future rental payments under
noncancellable operating leases during the next five years and
thereafter.

Years ending December 31, 2003 . . . . $ 344,109
2004. . . . . 340,304
2005. . . . . 317,955
2006. . . . . 301,878
2007. . . . . 284,768
Thereafter. . 2,057,051
----------
Total future minimum rental payments . $3,646,065
==========

6. RELATED PARTY TRANSACTIONS

Included in other assets is a note receivable from BPHI in the amount
of $1,836. This note matures in November 2006 and bears at a rate of
prime less .5% (4.25% at December 31, 2002).

During the year, the Company made advances to an affiliate of BPHI
pursuant to a loan agreement which matures on December 31, 2003.
Advances bear interest at a rate of prime less .5%, such rate being
4.25% at December 31, 2002. Total interest earned on the advances
aggregated $11,528 for the year ended December 31, 2002, at which
time the balance outstanding, including accrued interest was
$118,875.

7. PARTNERS' CAPITAL

During the year, the Company purchased limited partnership units from
certain partners at a price in excess of current carrying value which
resulted in an adjustment to the carrying value of the remaining
partnership units.

8. COMMITMENTS AND CONTINGENCIES

The Company is obligated under various ground leases expiring between
2069 and 2077. The following is a schedule of the future minimum
rental payments under these leases;

Years ending December 31, 2003 . . . . $ 12,997
2004. . . . . 13,016
2005. . . . . 13,033
2006. . . . . 13,051
2007. . . . . 13,069
Thereafter. . 620,056
----------
$ 685,222
==========

The Company is subject to pending legal proceedings and litigation
incidental to its business. Management believes the maximum
liability that may result from any adverse determination from these
legal actions is covered by the amount of insurance available under
the Company's policy, and therefore, such legal actions will not be
material to the Company's financial position.

9. IMPACT OF SEPTEMBER 11, 2001

On September 11, 2001, the Company owned eight million square feet of
space in four office towers surrounding the World Trade Center site -
One Liberty Plaza and Towers A, B and D of the World Financial
Center. These properties sustained non-structural damage as a result
of the attack on and subsequent collapse of the World Trade Center.
The primary nature of the damage consisted of replacement of broken
windows and some repair to the granite facade on the World Financial
Center. As a result of the type of leases on two of the Company's
properties, the Company was responsible for the repairs to One
Liberty Plaza and One World Financial Center - Tower A. The Company
is also responsible to repair the glass - enclosed Winter Garden
atrium at the center of the World Financial Center which suffered
more significant damage from falling debris than other areas of the
complex. The two remaining properties, Towers B and D at the World
Financial Center, are triple-net leased to Merrill Lynch, who is
responsible for the cost of repairs to such properties.

The Company maintains insurance coverage for both clean-up and repair
costs as well as the temporary loss of rent. The Company is covered
for any costs incurred to repair damage to One Liberty Plaza, One
World Financial Center, the Winter Garden atrium and common areas of
the World Financial Center, as well as for business interruption.
Towers B and D of the World Financial Center are covered by insurance
in place under the Merrill Lynch leases. The total estimated costs
of clean-up and repair work is approximately $133 million all of
which the Company believes is recoverable from insurance carriers.
As of December 31, 2002, approximately $122,100 (approximately
$97,800 in 2002) of costs have been incurred of which $85,600 has
been received from insurance carriers. In addition, the Company has
recognized approximately $97,600 (approximately $48,900 in 2002) as
lost rental revenue of which approximately $91,100 has been received
as of December 31, 2002. In accordance with EITF 01-10 costs are
expensed when incurred and insurance recoveries are recognized when
they are deemed probable. Insurance proceeds through March 21, 2003
are approximately $187,500. The Company expects to collect the full
balance of its claim.

One Liberty Plaza and World Financial Center - Tower D reopened in
October 2001 and World Financial Center - Towers A and B reopened in
the first quarter of 2002. The repairs to the Winter Garden atrium
were completed in September 2002. No material lease cancellations in
the properties occurred as a result of this event.

The Company has $300 million of insurance for damage and business
interruption costs sustained as a result of an act of terrorism.
However, a terrorist act could have a material effect on the
company's assets to the extent damages exceed the coverage. The
Company has reviewed its loan agreements and believes it is in
compliance, in all material respects, with the contractual
obligations therein.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

There were no changes in, or disagreements with, accountants during
2002 and 2001.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS

The Corporate General Partner of the Partnership, JMB Park Avenue,
Inc., an Illinois corporation, is a wholly-owned subsidiary of JMB
Investment Holdings - I, Inc., a Delaware corporation. All of the
outstanding shares of stock of JMB Investment Holdings - I, Inc. are owned,
indirectly, by JMB Realty Corporation, a Delaware corporation ("JMB").
Substantially all of the shares of JMB are owned, directly or indirectly,
by certain of its officers, directors, members of their families and their
affiliates. The Corporate General Partner has responsibility for all
aspects of the Partnership's operations, subject to the requirement that
the sale of all or substantially all of the Partnership's interest in BFP,
LP or of all or substantially all of the 245 Park Avenue office building,
unless required by the terms of the BFP, LP venture agreement, must be
approved by the Associate General Partner of the Partnership, Park
Associates, L.P., an Illinois limited partnership with JMB Park Avenue,
Inc. as the sole general partner. The limited partners of the Associate
General Partner are generally JMB, current or former officers and directors
of JMB, their affiliates and current or former officers of Merrill Lynch,
Pierce, Fenner & Smith Incorporated.

The Partnership is subject to certain conflicts of interest arising
out of its relationships with the General Partners and their affiliates as
well as the fact that the General Partners and their affiliates are engaged
in a range of real estate activities. Certain services have been and may
in the future be provided to the Partnership by affiliates of the General
Partners, including administrative services. In general, such services are
to be provided on terms no less favorable to the Partnership than could be
obtained from independent third parties and are otherwise subject to
conditions and restrictions contained in the Partnership Agreement. The
Partnership Agreement permits the General Partners and their affiliates to
provide services to, and otherwise deal and do business with, persons who
may be engaged in transactions with the Partnership, and permits the
Partnership to borrow from, purchase goods and services from, and otherwise
to do business with, persons doing business with the General Partners or
their affiliates. The General Partners and their affiliates may be in
competition with the Partnership or its investment properties under certain
circumstances, including for tenants for properties and/or for the sale of
properties. Because the timing and amount of cash distributions and
profits and losses of the Partnership may be affected by various
determinations by the General Partners under the Partnership Agreement,
including whether and when to sell (or consent to the sale of) investment
property, the establishment and maintenance of reasonable reserves, the
timing of expenditures and the allocation of certain tax items under the
Partnership Agreement, the General Partners may have a conflict of interest
with respect to such determinations. The General Partners and their
affiliates may also have a conflict of interest with respect to matters
relating to the term loan notes and the demand notes payable to JMB,
including, among other things, the assessment by JMB of default interest,
the enforcement of repayment of the notes and the remedies available to JMB
in the event of a default under any of the notes. Reference is made to the
discussions under "Investment in Unconsolidated Venture" and "Notes Payable
to an Affiliate" in the Notes for further information concerning the term
loan and demand notes.

The names, current positions and length of service therein of the
director and executive officers of the Corporate General Partner of the
Partnership are as follows:

SERVED IN
NAME OFFICE OFFICE SINCE
- ---- ------ ------------
Judd D. Malkin Chairman 03/26/84
Neil G. Bluhm Vice President 03/26/84
Gary Nickele Vice President 12/18/90
Patrick J. Meara President and Director 12/22/00
H. Rigel Barber Vice President 03/26/84
Gailen J. Hull Vice President 03/26/84

There is no family relationship among any of the foregoing director or
officers. The foregoing director has been elected to serve a term until
the annual meeting of the Corporate General Partner to be held on
August 12, 2003. All of the foregoing officers have been elected to serve
terms until the first meeting of the Board of Directors held after the
annual meeting of the Corporate General Partner to be held on August 12,
2003. There are no arrangements or understandings between or among any of
said director or officers and any other person pursuant to which any
director or officer was elected as such.

The foregoing director and officers are also officers and/or directors
of JMB. JMB is the corporate general partner of Carlyle Real Estate Limited
Partnership-XIII ("Carlyle-XIII") and the managing general partner of JMB
Income Properties, Ltd.-V ("JMB Income-V"). JMB is also the sole general
partner of the associate general partner of Carlyle-XIII.

The foregoing director and officers are also officers and/or directors
of various affiliated companies of JMB. Certain of such officers are also
partners, directly or indirectly, in the associate general partners in the
Partnership and Carlyle-XIII.

The business experience during the past five years of each such
director and officer of the Corporate General Partner of the Partnership
includes the following:

Judd D. Malkin (age 65) is Chairman and a director of JMB and an
officer and/or director of various JMB affiliates. He is also an
individual general partner of JMB Income-V. Mr. Malkin has been associated
with JMB since October, 1969. He is also a director of Chisox Corporation,
which is the general partner of a limited partnership that owns the Chicago
White Sox, a Major League Baseball team, and a director of CBLS, Inc.,
which is the general partner of the general partner of a limited
partnership that owns the Chicago Bulls, a National Basketball Association
team. Mr. Malkin was also Co-Chairman of the Board of Directors of Urban
Shopping Centers, Inc. from its inception in 1993 until November 2000.

Neil G. Bluhm (age 65) is President and a director of JMB and an
officer and/or director of various JMB affiliates. He is also an
individual general partner of JMB Income-V. Mr. Bluhm has been associated
with JMB since August, 1970. Mr. Bluhm has also been a principal of Walton
Street Capital, L.L.C., which sponsors real estate investment funds, since
its inception in November 1994. He was also Co-Chairman of the Board of
Directors of Urban Shopping Centers, Inc. from its inception in 1993 until
November 2000. Mr. Bluhm is a member of the Bar of the State of Illinois.

Gary Nickele (age 50) is Executive Vice President and General Counsel
of JMB and an officer and/or director of various JMB affiliates. Mr.
Nickele has been associated with JMB since February 1984. He holds a J.D.
degree from the University of Michigan Law School and is a member of the
Bar of the State of Illinois.

Patrick J. Meara (age 40) is a Senior Vice President of JMB. Prior to
becoming President and Director of the Corporate General Partner, Mr. Meara
was a Vice President of the Corporate General Partner from August 8, 2000
to December 22, 2000. He is also an officer and/or director of various
other JMB affiliates. He has been associated with JMB, JMB Institutional
Realty Corporation or their affiliates since 1987. Mr. Meara is a
Certified Public Accountant.

H. Rigel Barber (age 54) is Executive Vice President and Chief
Executive Officer of JMB and an officer of various JMB affiliates.
Mr. Barber has been associated with JMB since March, 1982. He holds a J.D.
degree from the Northwestern Law School and is a member of the Bar of the
State of Illinois.

Gailen J. Hull (age 55) is Senior Vice President and, since August
2002, Chief Financial Officer of JMB and is an officer of various JMB
affiliates. Mr. Hull has been associated with JMB since March, 1982. He
holds a Masters degree in Business Administration from Northern Illinois
University and is a Certified Public Accountant.

ITEM 11. EXECUTIVE COMPENSATION

The officers and the director of the Corporate General Partner receive
no direct remuneration in such capacities from the Partnership. The
General Partners are entitled to receive a share of cash distributions,
when and as cash distributions are made to the Holders of Interests, and a
share of profits or losses as described under the section entitled
"Partnership Agreement" in the Notes. No such cash distributions were paid
to the General Partners in 2002, 2001 or 2000. The General Partners were
allocated aggregate losses for tax purposes of ($5,867,736) from the
Partnership in 2002. Such allocation of losses may benefit the General
Partners to the extent that such losses may offset their taxable income
from other sources.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Pursuant to the Partnership Agreement, the Partnership is permitted to
engage in various transactions involving affiliates of the Corporate
General Partner of the Partnership. Such transactions may involve
conflicts of interest for the General Partners or their affiliates,
including, among others, those discussed in Item 10. Directors and
Executive Officers above. Various relationships of the Partnership to the
Corporate General Partner (and its director and executive officers) and its
affiliates are also set forth above in Item 10.

The General Partners of the Partnership or their affiliates may be
reimbursed for their direct expenses and out-of-pocket expenses relating to
the administration of the Partnership and operation of the Partnership's
real property investments. The General Partners were entitled to be
reimbursed for $1,213 of such expenses in 2002, all of which were paid at
December 31, 2002.

The General Partners and their affiliates are entitled to
reimbursements of salary and salary related expenses for legal, accounting
and certain other services. Such reimbursements will not exceed the lesser
of the actual cost of such services or the amount which the Partnership
would be required to pay independent parties for comparable services. For
2002, an affiliate of the General Partners was entitled to reimbursements
for such expenses in the amount of $49,666 of which $3,963 was payable at
December 31, 2002.

The Partnership had three term loan notes and two demand notes payable
to JMB during 2002. During 2002, interest of $712,198 was accrued on the
original demand note at the annual rate of prime (as such prime rate
changed from time to time) plus 1% (5.25% at December 31, 2002), interest
of $719,088 was accrued on the LIBOR Note at the annual rate of LIBOR (as
such LIBOR rate changed from time to time) plus 2.625% (4.064% at December
31, 2002), interest of $773,693 was accrued on the new demand note at the
annual rate of prime (as such prime rate changed from time to time) plus 1%
(5.25% at December 31, 2002), interest of $573,976 was accrued on the
$25,000,000 term loan at the annual rate of 2%, compounded annually, and
interest of $50,387 was accrued on the $2,194,631 term loan at the annual
rate of 2%, compounded annually. In addition, during 2002, JMB advanced
$662,951 to the Partnership pursuant to the new demand note and the
Partnership used the advances to pay the outstanding interest on the LIBOR
Note in 2002. On December 31, 2002, the Partnership paid to JMB
approximately $55,548,000 as repayment of principal and accrued interest on
two of the term loan notes and the two demand notes. The Partnership
reversed previous accrued interest of approximately $4,158,000 and
accordingly, four of the five notes outstanding were retired. The unpaid
principal and accrued interest balance on the remaining JMB Note at
December 31, 2002, was approximately $29,631,000. The remaining JMB Note,
which is secured by the Partnership's interest in BFP, LP, accrues interest
at 2% per annum, with interest compounded annually.

ITEM 14. CONTROLS AND PROCEDURES

Pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14 of
the Securities Exchange Act of 1934 (the "Exchange Act") promulgated
thereunder, the principal executive officer and the principal financial
officer of the Partnership have evaluated the effectiveness of the
Partnership's disclosure controls and procedures as of a date within 90
days prior to the date of the filing of this report (the "Evaluation Date")
with the Securities and Exchange Commission ("SEC"). Based on such
evaluation, the principal executive officer and the principal financial
officer have concluded that the Partnership's disclosure controls and
procedures were effective as of the Evaluation Date to ensure that
information required to be disclosed in this report was recorded,
processed, summarized and reported within the time period specified in the
applicable SEC rules and form for this report. Furthermore, there have
been no significant changes in the internal controls or in other factors
that could significantly affect internal controls subsequent to the date of

their most recent evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.

Due to its owning only a minority (approximately .5% at December 31,
2002) interest in BFP, LP, the Partnership's information concerning BFP,
LP, its properties, other assets and operations (including the risks
related thereto) is limited to and dependent upon the information provided
to the Partnership by BFP, LP and on publicly available information. As a
result, the information that the Partnership has included in this report
concerning such matters may not be the most current or complete. In
addition, due to the timing of receipt of information from BFP, LP, this
and other periodic reports filed by the Partnership with the SEC have not
always been filed within the time periods specified in the applicable SEC
rules and forms for such reports. The Partnership's disclosure controls
and procedures do not include the disclosure controls and procedures of
BFP, LP, which the Partnership has no ability to control.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) The following documents are filed as part of this report.

(1) Financial Statements (See Index to Financial Statements and
Supplementary Data filed with this report).

(2) Exhibits.

3-A. Amended and Restated Agreement of Limited Partnership
of the Partnership is hereby incorporated by
reference to Exhibit 3-A to the Partnership's Report
for June 30, 2002 on Form 10-Q (File No. 0-13545)
dated August 21, 2002.

3-B. Amendment to the Amended and Restated Agreement of
Limited Partnership of JMB/245 Park Avenue
Associates, Ltd. by and between JMB Park Avenue, Inc.
and Park Associates, L.P. dated January 1, 1994 is
hereby incorporated by reference to Exhibit 3-B to
the Partnership's Form 10-Q Report for March 31, 1995
(File No. 0-13545) filed May 11, 1995.

4-A. Loan agreement dated June 27, 1984 between JMB/245
Park Avenue Associates and Continental Illinois
National Bank and Trust Company of Chicago is hereby
incorporated by reference to Exhibit 4-B to the
Partnership's Registration Statement on Form 10 (as
amended) of the Securities Exchange Act of 1934 (File
No. 0-13545) filed on April 29, 1985.

4-B. $16,042,000 Second Amended and Restated Promissory
Note and related documents dated August 1, 1995
between JMB/245 Park Avenue Associates and JMB Realty
Corporation are hereby incorporated herein by
reference to Exhibit 4-U to the Partnership's Form
10-Q Report for September 30, 1995, (File No. 0-
13545) filed on November 9, 1995.

4-C. $25,000,000 Second Amended and Restated Promissory
Note and related documents dated August 1, 1995
between JMB/245 Park Avenue Associates and JMB Realty
Corporation, are hereby incorporated herein by
reference to Exhibit 4-V to the Partnership's Form
10-Q Report for September 30, 1995, (File No. 0-
13545) filed on November 9, 1995.

4-D. $2,194,631.25 Amended and Restated Promissory Note
and related documents dated August 1, 1995 between
JMB/245 Park Avenue Associates and JMB Realty
Corporation, are hereby incorporated herein by
reference to Exhibit 4-W to the Partnership's Form
10-Q Report for September 30, 1995, (File No. 0-
13545) filed on November 9, 1995.

4-E. Amended and Restated Demand Note dated August 1, 1995
between JMB/245 Park Avenue Associates, Ltd. and JMB
Realty Corporation, are hereby incorporated herein by
reference to Exhibit 4-X to the Partnership's Form
10-Q Report for September 30, 1995, (File No. 0-
13545) filed on November 9, 1995.

4-F. Fourth Amendment to Loan Documents dated August 1,
1995 between JMB/245 Park Avenue Associates, Ltd. and
JMB Realty Corporation detailing amendments to the
term loans, are hereby incorporated herein by
reference to Exhibit 4-Y to the Partnership's Form
10-Q Report for September 30, 1995, (File No. 0-
13545) filed on November 9, 1995.

4-G. Consent Agreement dated December 29, 1983 from
JMB/245 Park Avenue Associates, Ltd. to Continental
Illinois Bank of Chicago (Continental) detailing the
transactions for which the Partnership would obtain
Continental's consent, are hereby incorporated herein
by reference to Exhibit 4-Z to the Partnership's Form
10-Q Report for September 30, 1995, (File No. 0-
13545) filed on November 9, 1995.

4-H. Third Amended and Restated Security Agreement dated
August 1, 1995 between JMB/245 Park Avenue
Associates, Ltd. and JMB Realty Corporation, are
hereby incorporated herein by reference to Exhibit 4-
AA to the Partnership's Form 10-Q Report for
September 30, 1995, (File No. 0-13545) filed on
November 9, 1995.

4-I. Amendment No. 1 to $16,042,000 Second Amended and
Restated Promissory Note made effective January 3,
2001 between JMB/245 Park Avenue Associates, Ltd. and
JMB Realty Corporation is hereby incorporated herein
by reference to Exhibit 4-A to the Partnership's
Report for March 31, 2001 on Form 10-Q (File No. 0-
13545) dated May 9, 2001.

4-J. Amendment No. 1 to $25,000,000 Second Amended and
Restated Promissory Note made effective January 3,
2001 between JMB/245 Park Avenue Associates, Ltd. and
JMB Realty Corporation is hereby incorporated herein
by reference to Exhibit 4-B to the Partnership's
Report for March 31, 2001 on Form 10-Q (File No. 0-
13545) dated May 9, 2001.

4-K. Amendment No. 1 to $2,194,321.25 Amended and Restated
Promissory Note made effective January 3, 2001
between JMB/245 Park Avenue Associates, Ltd. and JMB
Realty Corporation is hereby incorporated herein by
reference to Exhibit 4-C to the Partnership's Report
for March 31, 2001 on Form 10-Q (File No. 0-13545)
dated May 9, 2001.

4-L. Demand Note dated May 7, 2001 between JMB/245 Park
Avenue Associates, Ltd. and JMB Realty Corporation
is hereby incorporated herein by reference to Exhi
bit 4-D to the Partnership's Report for June 30, 2001
on Form 10-Q (File NO. 0-13545) dated August 10,
2001.

10-A. Third Amended Joint Plan of Reorganization dated
September 12, 1996 is hereby incorporated herein by
reference to Exhibit 10-H to the Partnership's report
for September 30, 1996 on Form 10-Q (File No. 0-
13545) filed on November 8, 1996.

10-B. Limited Liability Company Agreement of JMB 245 Park
Avenue Holding Company, LLC dated as of November 12,
1996 is hereby incorporated by reference to the
Partnership's Report for November 21, 1996 on Form 8-
K (File No. 0-13545) filed on December 6, 1996.

10-C. Amended and Restated Agreement of Limited Partnership
of World Financial Properties, L.P. dated as of
November 21, 1996 is hereby incorporated by reference
to the Partnership's Report for November 21, 1996 on
Form 8-K (File No. 0-13545) filed on December 6,
1996.

10-D. JMB Transaction Agreement dated as of November 21,
1996 is hereby incorporated by reference to Exhibit
10.2 to the Partnership's Report for November 21,
1996 on Form 8-K (File No. 0-13545) filed on
December 6, 1996.

10-E. Consent and Substitution of Collateral dated
November 21, 1996 is hereby incorporated herein by
reference to Exhibit 10-E to the Partnership's Report
for March 31, 1997 on Form 10-Q (File No. 0-13545)
filed on May 9, 1997.

10-F. Redemption Agreement between JMB 245 Park Avenue
Holding Company, LLC, WFP Property G.P. Corp. and
Brookfield Financial Properties, L.P., dated
December 31, 2002 is hereby incorporated herein by
reference to Exhibit 10.1 to the Partnership's Report
for December 31, 2002 on Form 8-K (File No. 0-13545)
filed on January 15, 2003.

10-G. Fourth Amended and Restated Agreement of Limited
Partnership of Brookfield Financial Properties, L.P.
dated as of December 31, 2002 is hereby incorporated
herein by reference to Exhibit 10.2 to the
Partnership's Report for December 31, 2002 on Form 8-
K (File No. 0-13545) filed on January 15, 2003.

21. List of Subsidiaries of the Partnership.

99. Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 is filed herewith.

99.1 Article 14 (pages 15-17) of the Partnership's Amended
and Restated Agreement of Limited Partnership is
filed herewith.

(b) The following report on Form 8-K was filed since the beginning of
the last quarter of the period covered by this report.

The Partnership's report on Form 8-K for December 31, 2002
(File No. 0-13545) describing under Item 2 (Disposition of Assets)
the redemption of 90% of the Partnership's interest in BFP, LP was
filed on January 15, 2003.

No annual report or proxy material for the fiscal year 2002 has been
sent to the Partners of the Partnership. An annual report will be sent to
the Partners subsequent to this filing.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Partnership has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

JMB/245 PARK AVENUE ASSOCIATES, LTD.

By: JMB Park Avenue, Inc.
Corporate General Partner

GAILEN J. HULL
By: Gailen J. Hull
Vice President
Date: June 20, 2003

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

By: JMB Park Avenue, Inc.
Corporate General Partner

PATRICK J. MEARA
By: Patrick J. Meara, President and Director
Principal Executive Officer
Date: June 20, 2003

GAILEN J. HULL
By: Gailen J. Hull, Vice President
Principal Accounting Officer
and Principal Financial Officer
Date: June 20, 2003

CERTIFICATIONS
--------------

I, Patrick J. Meara, certify that:

1. I have reviewed this annual report on Form 10-K of JMB/245 Park
Avenue Associates, Ltd.;

2. Based on my knowledge, this annual report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this annual report;

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
and we have:

a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this
annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this annual report (the "Evaluation
Date"); and

c) presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;

5. The registrant's other certifying officer and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and
the audit committee of registrant's board of directors (or persons
performing the equivalent functions):

a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant's auditors any material
weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and

6. The registrant's other certifying officer and I have indicated in
this annual report whether there were significant changes
in internal controls or in other factors that could significantly
affect internal controls subsequent to the date of our most recent
evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.

Date:June 20, 2003

/s/ Patrick J. Meara
----------------------------
Principal Executive Officer

I, Gailen J. Hull, certify that:

1. I have reviewed this annual report on Form 10-K of JMB/245 Park
Avenue Associates, Ltd.;

2. Based on my knowledge, this annual report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this annual report;

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
and we have:

a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this
annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this annual report (the "Evaluation
Date"); and

c) presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;

5. The registrant's other certifying officer and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and
the audit committee of registrant's board of directors (or persons
performing the equivalent functions):

a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant's auditors any material
weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and

6. The registrant's other certifying officer and I have indicated in
this annual report whether there were significant changes
in internal controls or in other factors that could significantly
affect internal controls subsequent to the date of our most recent
evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.

Date:June 20, 2003

/s/ Gailen J. Hull
---------------------------
Principal Financial Officer

JMB/245 PARK AVENUE ASSOCIATES, LTD.

EXHIBIT INDEX

DOCUMENT
INCORPORATED
BY REFERENCE
-------------
3-A. Amended and Restated Agreement of
Limited Partnership of the
Partnership. Yes

3-B. Amendment to the Amended Limited
Partnership Agreement of Partnership
of JMB/245 Park Avenue Associates, Ltd. Yes

4-A. Loan agreement dated June 27,
1984 between JMB/245 Park Avenue
Associates and Continental Illinois
National Bank and Trust Company of
Chicago. Yes

4-B. $16,042,000 Second Amended and
Restated Promissory Note and
related documents dated August 1,
1995 between JMB/245 Park Avenue
Associates and JMB Realty Corporation Yes

4-C. $25,000,000 Second Amended and
Restated Promissory Note and
related documents dated August 1,
1995 between JMB/245 Park Avenue
Associates and JMB Realty Corporation Yes

4-D. $2,194,631.25 Amended and Restated
Promissory Note and related documents
dated August 1, 1995 between
JMB/245 Park Avenue Associates and
JMB Realty Corporation Yes

4-E. Amended and Restated Demand Note
dated August 1, 1995 between JMB/245
Park Avenue Associates and JMB Realty
Corporation Yes

4-F. Fourth Amendment to Loan Documents
dated August 1, 1995 between JMB/245
Park Avenue Associates, Ltd. and
JMB Realty Corporation Yes

4-G. Consent Agreement dated December 29,
1983 from JMB/245 Park Avenue Associates
to Continental Illinois Bank of
Chicago (Continental) Yes

4-H. Third Amended and Restated Security
Agreement dated August 1, 1995 between
JMB/245 Park Avenue Associates, Ltd.
and JMB Realty Corporation Yes

4-I. Amendment No. 1 to $16,042,000 Second
Amended and Restated Promissory Note
made effective January 3, 2001 between
JMB/245 Park Avenue Associates and
JMB Realty Corporation Yes

DOCUMENT
INCORPORATED
BY REFERENCE
-------------

4-J. Amendment No. 1 to $25,000,000 Second
Amended and Restated Promissory Note
made effective January 3, 2001 between
JMB/245 Park Avenue Associates and
JMB Realty Corporation Yes

4-K. Amendment No. 1 to $2,194,321.25
Amended and Restated Promissory Note
made effective January 3, 2001 between
JMB/245 Park Avenue Associates and
JMB Realty Corporation Yes

4-L. Demand Note dated May 7, 2001 between
JMB/245 Park Avenue Associates and
JMB Realty Corporation Yes

10-A. Third Amended Joint Plan of Reorganiza-
tion dated September 12, 1996 Yes

10-B. Limited Liability Company Agreement of
JMB 245 Park Avenue Holding Company, LLC
dated as of November 12, 1996. Yes

10-C. Amended and Restated Agreement of
Limited Partnership of World Financial
Properties dated as of November 21, 1996 Yes

10-D. JMB Transaction Agreement dated as of
November 21, 1996 Yes

10-E. Consent and Substitution of Collateral
dated November 21, 1996 Yes

10-F. Redemption Agreement between JMB 245
Park Avenue Holding Company, LLC, WFP
Property G.P. Corp. and Brookfield
Financial Properties, L.P. Yes

10-G. Fourth Amended and Restated Agreement
of Limited Partnership of Brookfield
Financial Properties, L.P. Yes

21. List of Subsidiaries of the Partnership. No

99. Certification Pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act
of 2002 No

99.1 Article 14 (pages 15-17) of the
Partnership's Amended and Restated
Agreement of Limited Partnership No