Q4 2021 Brookfield Asset Management Inc Earnings Call

Speaker 1: Ladies and gentlemen, thank you for standing by and welcome to the Brookfield Asset Management fourth quarter 2021 results conference call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Ms. Suzanne Fleming, managing partner. Please go ahead. Thank you, operator, and good morning, everyone. Welcome to Brookfield's fourth quarter and 2021 full year conference call. On the call today are

Ladies and gentlemen, thank you for standing by and welcome to the Brookfield asset management fourth quarter 2021 results Conference call. Please be advised that today's conference is being recorded I would now like to hand, the conference over to your Speaker Ms. Suzanne Fleming managing partner. Please go ahead.

Thank you operator, and good morning, everyone welcome to Brookfield fourth quarter in 2021 full year conference call on the call today are Bruce Flatt, Our Chief Executive Officer, Nick Goodman, Our Chief Financial Officer, and Natalie automate managing director in our renewable power and transmission group.

Speaker 2: start off by giving a business update followed by Nick who will discuss our financial and operating results. And finally Natalie will give an update on our transition strategy. After our formal remarks, we'll turn the call over to the operator and take analyst questions. In order to accommodate all...

Bruce will start off by giving a business update followed by Nick who will discuss our financial and operating results and finally, Natalie we'll give an update on our transition strategy.

After our formal remarks, we will turn the call over to the operator and take analyst questions in order to accommodate all those who want to ask questions. We ask that you refrain from asking more than two questions. At a time. If you have additional questions. Please rejoin the queue and we'll be happy to take any additional questions at the end of this time permit.

I'd like to remind you that in today's comments, including in responding to questions and in discussing new initiatives and our financial and operating performance. We may make forward looking statements.

Forward looking statements within the meaning of applicable Canadian and U S. Securities Law. These statements reflect predictions of future events and trends and do not relate to historic events. They are subject to known and unknown risks and future events and results may differ materially from such statements.

For further information on these risks.

Potential impact on our company. Please see our filings with the securities regulators in Canada, and the U S and the information available on our website and with that I'll turn the call over to Bruce.

Speaker 3: Thank you, Suzanne, and welcome everyone on the call. We reported strong...

Thank you Suzanne and welcome everyone on the call.

We reported strong results for the year.

Speaker 3: with record total net income of $12.4 billion.

With record total net income of $12 4 billion.

Speaker 3: and distributable earnings for common shareholders of $6.3 billion.

And distributable earnings for common shareholders of $6 3 billion.

Results were driven by 71 billion of inflows of capital and associated.

Speaker 3: Results were driven by $71 billion of inflows of capital and associated fee-related earnings.

Fee related earnings.

Strong performance from our principal investments.

Speaker 3: and gains in carry received from $42 billion of asset sales, where we booked 16 bills.

And gains in carry received from $42 billion of asset sales.

Where we booked $16 billion of gains.

Speaker 3: 12 billion for clients and 4 billion which came to BAMF.

12 billion for clients and $4 billion, which came to Bam.

As we enter 2022, the normalization of Central Bank Monetary policy has caused volatility in the markets.

Speaker 3: As we enter 2022, the normalization of central bank monetary policy has caused volatility in the markets, mostly in sectors trading at high multiples.

Mostly in sectors trading at high multiples.

Those did not affect us in any major way.

Speaker 3: Our general view is that this has been a healthy rerating and will likely...

Our general view is that this has been a healthy re rating.

And we will likely create opportunity.

Speaker 3: for our business with interest rates still very low on a relative basis.

For our business with interest rates still very low on a relative basis and expected to stay so for some time.

Speaker 3: and expected to stay so for some time.

Speaker 3: combined with the positive inflation of revenue.

Combined with the positive inflation of revenues.

We are seeing a positive backdrop for most of our businesses.

Speaker 3: we are seeing a positive backdrop for most of our.

Speaker 3: Our asset management business is continuing to attract large amounts of capital with our product offerings aligned around several positive global investment themes. Our underlying operation is to provide a more sustainable and sustainable solution to the innovation whispers such as armstrongness,

Our asset management business is continuing to attract large amounts of capital with our product offerings aligned around several positive global investment themes.

Our underlying operations continue to strengthen.

Speaker 3: coming out of the recession and with many of our businesses generating inflation-linked cash flows or positioned to benefit from economic growth, we are well positioned.

Coming out of the recession.

With many of our businesses generating inflation linked cash flows or.

We're positioned to benefit from economic growth.

We are well positioned.

Turning now to our strategic initiatives 2021 was a busy year in that regard.

Speaker 3: 2021 was a busy year in that regard.

First off.

Speaker 3: spun out and paired our reinsurance business, establishing BAMR.

We spun out impaired our reinsurance business, establishing bam or.

Speaker 3: Subsequent to that, we completed a number of reinsurance agreements and committed to acquire American National, which we expect to close in the coming months.

Subsequent to that we completed a number of reinsurance agreements and committed to acquire American national which we expect to close in the coming months.

American National give us the U S insurance platform and provide us with direct origination capabilities and.

Speaker 3: American National give us a US insurance platform and provide us with direct origination capability.

Speaker 3: total, we are heading towards $50 billion of insurance AUM, and the team is just getting started.

In total we are heading towards $50 billion of insurance AUM.

And the team is just getting started.

Second we prioritized our real estate business.

Speaker 3: In short, we own one of the highest quality portfolios of prime properties in the world.

In short we own one of the highest quality portfolios of prime properties in the world.

Speaker 3: real estate securities were, and in fact still are, trading in the market at discounts to their fair value.

Real estate Securities were.

And in fact still are trading in the market at discounts.

So there.

The fair value.

On the other hand private markets are not.

BP Y shareholders were offered the ability to participate in them.

Speaker 3: BPY shareholders were offered the ability to participate in BAM. So in our view of privatization was a win-win.

So in our view a privatization was a win win.

To date, it has turned out to be that way for everyone.

Speaker 3: In the last year, the tone of the private real estate market has improved dramatically, and liquidity in private markets is now returning to pre-pandemic level.

In the last year, the tone of the private real estate market has improved dramatically and liquidity in private markets is now returning to pre pandemic levels.

Speaker 3: The recovery started with the growth sectors like industrial and life science.

The recovery started with the growth sectors like industrial and life Sciences.

Speaker 3: followed by multifamily and is now turned to office with

Followed by multifamily is now and has now turned to office with the rest to follow.

Speaker 3: In accordance with the plans we laid out for you at the time, we recently sold approximately $10 billion of real estate across a variety of sectors.

In accordance with the plans we laid out for you at the time, we recently sold approximately $10 billion of real estate across the various variety of sectors.

Speaker 3: we realized the gain of $2 billion above purchase price last year in the sales, representing a 47% annualized gain on the asset portion of ours. A good example of this is...

We realized a gain of $2 billion about purchase price last year and the sales.

Representing a 47% annualized gain on the asset portion of ours.

A good example of this is one Manhattan West, which is a phenomenal office tower in New York City, we completed in 2019.

Speaker 3: is a phenomenal office tower in New York City we completed in 2019 in a complex where we own five other

In a complex, where we owned five other towers.

Speaker 3: We recently signed an agreement to sell a stake in it, which values the property at 2.9 billion, representing a two and a half times multiple of capital, and a 25% IRR.

We recently signed an agreement to sell a stake in it which values the property at $2 9 billion, representing a $2 five to five times multiple of capital and a 25% IRR since we started it.

Speaker 3: We're also retaining a controlling stake in the property that will continue to provide us with long-term compounding cash flows going forward.

We are also retaining a controlling stake in the property that will continue to provide us with long term compounding cash flows going forward.

Speaker 3: So as the recovery continues to gather pace, we are well positioned to strategically monetize further select assets and unlock more value in our real estate.

So as the recovery continues to gather pace, we are well positioned to strategically monetize further select assets and unlock more value in our real estate to be deployed elsewhere.

Speaker 3: Our third strategic initiative was to repackage, rebrand, and expand our renewables investing strategy into a fund for transition to net zero.

Our third strategic initiative was to repackage rebrand and expand our renewables investing strategy into a fund for transition to net zero.

Speaker 3: This culminated in a large fund which will close at $15 billion short.

This culminated in a large fund, which will close at $15 billion shortly.

Speaker 3: Natalie Adame is here today to provide more details for you on that.

Italy animate is here today to provide more details for you on that.

Speaker 3: Our last strategic initiative was a review of our overall structure of our asset management business as the financial market

Our last strategic initiative was a review of our overall structure of our asset management business.

As the financial markets evolve.

Speaker 3: As noted in our year-end letter, over the past 25 years, we have become one of the largest, fastest growing, and most diversified managers globally.

As noted in our year end letter over the past 25 years, we have become one of the largest fastest growing and most diversified managers globally.

Speaker 3: combined with the fact that we have very long duration annuity life cash flows.

Bind with the fact.

We have very long duration annuity like cash flows.

Speaker 3: Our manager is now of the scale that it could be separated out from the rest of our capital.

Our manager is now at the scale it could be separated out from the rest of our capital.

Speaker 3: In a market environment that seemingly perverts asset life managers, it may therefore make sense to separate part of the manager and offer investors a security that owns our asset manager separate from our capital.

In a market environment that seemingly preferreds asset light managers. It made therefore makes sense to separate part of the manager and offer investors a security that owns our asset manager separate from our capital.

Speaker 3: For backdrop, based on comparable multiples for pure play, asset light, alternative investment managers, our managers should be valued in the range of $70 to $100 billion.

For backdrop based on comparable multiples for pure play asset light alternative investment managers, our manager should be valued in the range of 70 to 100 billion.

Speaker 3: This is in addition to the $50 billion of net capital that we have invested in our businesses today.

This is in addition to the $50 billion of net capital that we have invested in our businesses today.

If we separate part of the manager.

Speaker 3: this could increase the simplicity and ease of valuing our asset management business.

This could increase the simplicity and ease of valuing our asset management business.

Speaker 3: provide a security for those that wish asset life.

Provide a security for those that wish asset light.

Speaker 3: and also possibly open up new growth options for the overall business.

And also possibly open up new growth options for the overall business.

As you all know our.

Speaker 3: Our business has compounded at an annualized return of 20% for 20 years.

Our business has compounded in an annualized return of 20% for 20 years.

Speaker 3: Our job is always to continue to invest well.

Our job is always to continue to invest well.

Take care of our clients.

Speaker 3: and review our structure from time to time to ensure we unlock value for all shareholders.

And review our structure from time to time to ensure we and unlock value for all shareholders.

We will report on this as we move along.

Speaker 3: As always, thank you for your support. And with that, I'll turn the call over to Nick to tell you about our financial results.

As always thank you for your support and with that I'll turn the call over to Nick to.

To tell you about our financial results.

Thank you Bruce and good morning, everyone.

Speaker 4: So we had strong financial results for the year with record net income of $12.4 billion and this compares to $707 million of net income in the prior year.

So we had strong financial results for the year with record net income of $12 $4 billion and this compares to $707 million of net income in the prior year.

Speaker 4: Distributable earnings or DE for the year were $6.3 billion or $3.96 a share compared to $4.2 billion or $2.74 a share in 2020.

Distributable earnings or de for the year were $6 3 billion or $3 96, a share compared to $4 2 billion or $2 74, a share in 2020.

Speaker 4: The uplift in both net income and DE was due to excellent operating and financial performance across our business.

The uplift in both net income and <unk> was due to excellent operating and financial performance across our businesses.

Speaker 4: Our asset manager continued its strong growth trajectory supported by record levels of fundraising with total inflows of $71 billion. We ended the year with $364 billion of fee-bearing capital, an increase of 17% from the prior year.

Our asset manager continued its strong growth trajectory supported by record levels of fundraising with total inflows of $71 billion.

We ended the year with $364 billion of fee bearing capital an increase of 17% from the prior year.

Speaker 4: Inflows were supported by the continued scaling of our flagship funds as well as the success of many of our complementary product offerings.

Inflows were supported by the continued scaling of our flagship funds as well as the success of many of our complementary product offerings.

Speaker 4: During the year, we held a final close for our latest opportunistic credit fund for $16 billion, the largest ever raised for the strategy. And we've been successful in deploying this capital at attractive returns, with this fund already approximately 75% invested or committed today.

During the year, we held a final close for our latest opportunistic credit fund for $16 billion the largest ever raised for this strategy and we've been successful in deploying this capital at attractive returns with this fund already approximately 75% invested or committed today.

Speaker 4: We will shortly close on $15 billion for our transition fund, and combined with our fourth flagship real estate fund, we have raised $24 billion in aggregate for those two funds to date.

We will shortly close on $15 billion for our transition fund and combined with our fourth flagship real estate fund, we have reached $24 billion in aggregate for those two funds to date.

Speaker 4: Our sixth flagship private equity fund launched fundraising in the fourth quarter, and we also recently started fundraising for our fifth flagship infrastructure fund.

Our sixth flagship private equity fund launch front launched fundraising in the fourth quarter and we also recently started fundraising for our fifth flagship infrastructure fund.

Speaker 4: And to meet our clients' needs, we're also introducing new products. To give a couple of examples, our Growth Equity Fund, which focuses on technology investments that are adjacent to our businesses, recently had a final close of over $500 million.

And to meet our clients' needs. We're also introducing new products to give a couple of examples our growth equity fund, which focuses on technology investments that are adjacent to our businesses recently had a final close to over $500 million.

Speaker 4: and we've seen an accelerated pace of deployment for this fund. And as a result, we expect to be in the market with the next vintage shortly.

And we've seen an accelerated pace of deployment for this fund and as a result, we expect to be in the market with the Knicks vintage shortly.

Speaker 4: We also launched our real estate secondary strategy, raised $2 billion of capital for it and have now launched the traditional commingled fund.

We also launched a real estate secondaries strategy reached $2 billion of capital for it and have no launched a traditional commingled fund.

Speaker 4: We also established a focused Wealth Solutions Marketing Group. This team is focused on developing and distributing our products into the private wealth channel. And this includes our traditional closed-end funds and new products, including our private, non-traded regions.

We also established a focused wealth solutions marketing group.

<unk> team is focused on developing and distributing our products into the private wealth channel and this includes our traditional closed end funds and new products, including our private non traded REIT.

Speaker 4: The growth in fee-bearing capital directly resulted in higher fee-related earnings, which were $1.9 billion for the year, an increase of 33% from the prior period.

The growth in fee bearing capital directly resulted in higher fee related earnings, which were $1 9 billion for the year, an increase of 33% from the prior period.

Speaker 4: And at the business scales, we would note that our margins continue to remain stable.

And as the business scales, we would note that our margins continue to remain stable.

Speaker 4: In addition to the current capital based earning management fees, we have $40 billion of additional committed capital that when invested will translate to approximately $400 million of incremental annual fee revenues. And this is a big tailwind.

In addition to the current capital base, earning management fees, we have $40 billion of additional committed capital the wind invested would translate to approximately $400 million of incremental annual fee revenues.

And this is a big tailwind to add to our earnings.

Speaker 4: Looking into 2022, we expect a notable step change in our fee earnings as we receive the full benefits from the fund raised in 2021 and our ongoing fundraising initiative.

And looking into 2022, we expect a notable step change in our fee earnings as we receive the full benefits from the funds raised in 2021 and our ongoing fundraising initiatives.

Speaker 4: As our earlier vintage funds mature, we are now realizing carried interest in each of our flagship strategies and in other complementary funds.

As our earlier vintage funds mature we're now realizing carried interest in each of our flagship strategies and in other complementary funds.

Speaker 4: We executed on a number of landmark capital recycling initiatives during the year, surfacing $42 billion of capital and crystallizing gains of $16 billion.

We executed on a number of landmark capital recycling initiatives during the year surfacing $42 billion of capital and crystallizing gains of $16 billion.

We realized a record $1 $7 billion of carried interest.

Speaker 4: We realized a record $1.7 billion of carried interest.

Speaker 4: and $2.1 billion of disposition gains from principal investors.

And $2 $1 billion of disposition gains from principal investments.

Speaker 4: Our remaining investments continue to perform very well across all our managed funds. We generated $5 billion of unrealized carried interest during the year, increasing the total accumulated unrealized carried interest by 107% to $7.7 billion net of that realized into income.

Our remaining investments continued to perform very well across all of our managed funds we generated $5 billion of unrealized carried interest during the year, increasing the total accumulated unrealized carried interest by 107% to seven 7 billion.

Net of that realized into income.

Speaker 4: We are projecting to realize up to $1 billion of carried interest in 2022 as we continue to execute on asset sales.

We are projecting to realize up to $1 billion of carried interest in 2022, as we continued to execute on asset sales.

Speaker 4: Lastly, our principal investments continue to provide strong and steady contributions to our distributable earnings.

Lastly, our principal investments continued to provide strong and steady contributions to our distributable earnings this year distributions from our investments for $2 2 billion.

Speaker 4: This year, distributions from our investments were $2.2 billion, 19% higher than the prior year. The increase was driven by distribution growth at BEP and BEP and the higher ownership of our real estate business.

19% higher than the prior year, the increase was driven by distribution growth at fit and Beth and the higher ownership of our real estate business.

Speaker 4: Funds from operations or FFO before realizations increased 15% compared to the prior year.

Funds from operations or <unk> before realization increased 15% compared to the prior year.

Speaker 4: The increase is largely driven by the continued growth in our asset management franchise, strong organic growth across our existing operations, as well as contributions from recent acquisitions. timelapse

The increase was largely driven by the continued growth of our asset management franchise strong organic growth across our existing operations as well as contributions from recent acquisitions.

Speaker 4: including realizations, FFO grew by 46% to $7.6 billion.

Including realizations <unk> grew by 46% to $7 6 billion.

Speaker 4: And it's worth noting that going forward to further enhance and align our financial disclosure, we will use DE as the primary measure of our performance.

And it's worth noting that going forward to further enhance and align our financial disclosure, we will use <unk> as the primary measure of our performance.

Speaker 4: Our liquidity position remains very strong. In addition to $77 billion of uncalled fund commitments, we have approximately $15 billion of core liquidity, meaning we have a total of $92 billion of deployable capital.

Our liquidity position remains very strong in addition to <unk> $77 billion of Uncalled fund commitments, we have approximately $15 billion of core liquidity. We mean, we have a total of $92 billion of deploy deployable capital.

This is further bolstered by our annualized day before realization.

Speaker 4: This is further bolstered by our annualized DE before realizations.

Speaker 4: Our scale capital will continue to allow us to capitalize on the interactive investment opportunities we see every day.

Our scale capital, we will continue to allow us to capitalize on the attractive investment opportunities we see everyday.

Speaker 4: Before I hand the call over to Natalie to discuss our transition strategy, I am pleased to confirm that our board of directors has declared a quarterly dividend of 14 cents a share, payable at the end of March, representing an 8% increase over the prior quarter.

Before I hand, the call over to Natalie to discuss our transition strategy I am pleased to confirm that our board of directors has declared a quarterly dividend of <unk> 14, a share payable at the end of March representing an 8% increase over the prior quarter.

Absolutely.

Speaker 2: Thanks, Nick. And good morning, everyone. I'm pleased to be here today to talk to you about Brookfield's new transition fund and the exciting opportunities we see for this strategy.

Thanks, Nick and good morning, everyone I am pleased to be here today to talk to you about Brookfield, New transition fund and the exciting opportunities we see for this strategy.

Speaker 2: Climate change is one of the most pressing and significant issues facing the economy today.

Climate change is one of the most pressing and significant issues facing the economy today.

Speaker 2: While climate change has been a focused topic for governments for years, the pace at which corporates are making commitments to lower emissions to net zero are now accelerating at a rapid pace.

While climate change has been a focused topic for government for years, the pace at which corporates are making commitments to lower emissions to net zero are now accelerating at a rapid pace.

Speaker 2: In the last two years, we've seen emissions covered by net zero commitments triple. An increase in the number of commitments of seven times for countries, five times for companies. And finally, commitments from the financial sector recognized by the Glasgow Financial Alliance for net zero increased 26 times from $5 trillion to over $130 trillion.

In the last two years, we've seen emissions covered by net zero commitments triple.

An increase an increase in the number of commitments of seven times for countries five times for companies.

Finally commitments from the financial sector recognized by the Glasgow Financial Alliance for net zero increased two six times from five trillion.

Two over 130 trillion.

Speaker 2: Achieving net zero emissions, and more specifically, the goals of the Paris Agreement, will require a massive amount of capital.

Achieving net zero emissions and more specifically the goals of the Paris agreement will require a massive amount of capital.

Speaker 2: It is estimated that over $150 trillion will need to be invested through 2050 to drive the decarbonization of energy systems and our economy.

It is estimated that over 150 trillion.

We will need to be invested through 2050 to drive the decarbonization of energy system and our economy.

Speaker 2: That's approximately $5 trillion every year.

Thats approximately five trillion every year.

Speaker 2: At Brookfield, we are rising to meet this capital need and exciting investment opportunity.

At the appeal, we are rising to meet this capital need and exciting investment opportunity.

Speaker 2: We are currently in the final stages of raising approximately $15 billion for our first flagship transition fund, the Brookfield Global Transition Fund, of which Brookfield itself will be the largest investor.

We are currently in the final stages of raising approximately $15 billion for our first flagship transition fund the Brookfield Global transition fund of which Brookfield itself will be the largest investor.

Speaker 2: and our fundraising has exceeded our expectations.

And our fundraising has exceeded our expectations. Once we reached final close we will have raised more capital and faster than we had planned and we have already started to put that capital to work.

Speaker 2: Once we reach final close, we will have raised more capital and faster than we had planned, and we have already started to put that capital to work.

Speaker 2: The success of our fundraising demonstrates that we have many like-minded investors who also recognize the urgency and the magnitude of capital required to transition the global economy to net zero.

The success of our fundraising demonstrates that we have many likeminded investors, who also recognized the urgency and the magnitude of capital required to transition the global economy to net zero.

Speaker 2: More importantly, they also understand that this investment opportunity can deliver strong financial returns and also a positive environmental impact.

More importantly.

They also understand that this investment opportunity can deliver strong financial returns.

And also a positive environmental impact.

Speaker 2: But more than that, our investors have chosen to invest with us because they recognize that in order to be a successful investor in decarbonization, it is essential to not only have access to capital, but to have deep operating expertise, particularly in power markets and renewables, both of which Brookfield has a proven track record in.

But more than that our investors have chosen to invest with us because they recognize that in order to be a successful investor in de carbonization. It is essential to not only have access to capital, but to have deep operating expertise, particularly in power markets and.

Renewables, both of which Brookfield has a proven track record in.

Speaker 2: The reason this expertise is so important is because about three-quarters of global carbon emissions can be traced back directly or indirectly to power generation and the energy sector.

The reason this expertise is so important is because about three quarters of global carbon emissions can be traced back directly or indirectly to power generation and the energy sector.

Speaker 2: Every business uses energy. Therefore, if you can help decarbonize the production of energy and electricity, you can enable the decarbonization of every industry in the world.

Every business uses energy. Therefore, if you can help decarbonize the production of energy and electricity you can enable the decarbonization of every industry in the world.

Speaker 2: And if renewables are the first step to decarbonization, we think our platform puts us in a leadership position.

And if renewables are the first step to decarbonization.

We think our platform puts us in a leadership position.

Speaker 2: Today, we own and operate one of the largest renewable power platforms globally.

To date, we own and operate one of the largest renewable power platforms globally.

Speaker 2: We are a leader in major renewable technologies, and perhaps most importantly, operate in every major power market around the world.

We are a leader in major renewable technologies and perhaps most importantly operate in every major power market around the world.

Speaker 2: We have operating and development capabilities, as well as local M&A teams sourcing and identifying decarbonization investments across every continent.

We have operating and development capabilities as well as local M&A team sourcing and identifying de carbonization investments across every continent.

Our fund will have two overarching goal.

Speaker 2: to generate strong risk-adjusted returns for our investors, and to deliver on meaningful decarbonization targets.

To generate strong risk adjusted return for our investors and to deliver on meaningful decarbonization targets.

Speaker 2: While we see a very wide range of opportunities to deploy capital, which can meet these objectives, today I want to highlight just two. The first of...

While we see a very wide range of opportunities to deploy capital, which can meet these objectives.

I want to highlight just two.

The first of course is clean energy.

Speaker 2: Given the scale of new build clean energy required, a core theme of our transition fund will be adding clean energy to the global electricity grid.

Given the scale of Newbuild clean energy required.

Core theme of our transition fund will be adding clean energy to the global electricity grid.

Speaker 2: In fact, one of the first investments that we recently made was Urban Grid, a leading US solar developer with a 20,000 megawatt development pipeline and a strong position in a high-value energy market.

In fact, one of the first investments that we recently made was urban grid, a leading U S. Solar developer with a 20000 megawatt development pipeline and a strong position in a high value energy market.

Speaker 2: We acquired the business for $650 million, with the opportunity to invest hundreds of millions of dollars into further growth in the future.

We acquired the business for $650 million with the opportunity to invest hundreds of millions of dollars into further growth in the future.

Speaker 2: This was a bilaterally sourced opportunity where our ability to transact quickly and leverage our existing commercial relationships enabled us to transact with Urban Grid at attractive terms.

This was a bilaterally sourced opportunity, where our ability to transact quickly and leverage our existing commercial relationships enabled us to transact with urban grid at attractive terms.

Speaker 2: And as an example of how we bring these commercial relationships to our development projects, well, the Fund has already made investments into other renewable assets for the benefit of commercial partners across various sectors, including for the likes of Amazon, Enbridge, and Scotiabank.

And as an example of how we bring these commercial relationships to our development projects well. The fund has already made investments into other renewable assets for the benefit of commercial partners.

Ross various sectors, including for the likes of Amazon.

And bridge and Scotiabank.

Speaker 2: A second large growth opportunity for BGTS is to use our knowledge of power markets and our operating capabilities to provide energy transition and decarbonization solutions to governments and businesses around the world that need help reaching their own decarbonization goals. This is a theme we're calling this...

Our second large growth opportunity for Bts is to use our knowledge of power market and our operating capabilities to provide energy transition and decarbonization solutions to governments and businesses around the world that need help reaching their own.

Decarbonization goals.

This is a theme, we're calling business transformation.

Speaker 2: Industries such as steel, cement, chemicals, and utilities all require both clean energy to lower their carbon footprints and capital to decarbonize their production processes or way of doing business. The auto industry...

Industries, such as steel cement chemicals and utilities.

All require both clean energy to lower their carbon footprint and capital to decarbonize their production processes or way of doing business.

The auto industry is an example of that Cigna.

Speaker 2: significant investment in public electrical vehicle charging infrastructure will need to be made to decarbonize the transport sector.

Significant investment in public electrical vehicle charging infrastructure will need to be made to decarbonize the transport sector.

Speaker 2: Similarly, in the power sector, utilities require significant capital to enable them to shift from coal to gas and from gas to fuel.

Similarly in the power sector utilities require significant capital to enable them to shift from coal to gas.

And from gas to renewables.

Speaker 2: And to have a material impact, you need to be willing to go where the emissions are.

And to have a material impact you need to be willing to go where the emissions are.

Speaker 2: Our fund plans to target companies in the hard to abate energy intensive sectors, which will continue to be a fundamental part of our society for years to come. And make sure that companies in those industries have the capital and the shareholder support to put them on a viable pathway towards lower emissions.

Our fund plans to target companies in the hard to abate.

Energy intensive sectors, which will continue to be a fundamental part of our society for years to come and make sure that companies in those industries has the capital and the shareholder support to put them on a viable pathway towards <unk>.

<unk> emissions.

Speaker 2: We believe that businesses on a path to net zero will benefit from premium valuations versus their peers, given the de-risk nature of their operations.

We believe that.

Businesses on a path to net zero will benefit from premium valuations versus their peers, given the derisked nature of their operations.

Speaker 2: Therefore, by investing in this theme, we will not only achieve our desired decarbonization impact, but also generate attractive commercial returns for our investors.

Therefore by investing in this theme, we will not only achieve our desired de carbonization impact, but also generate attractive commercial returns for our investors.

Speaker 2: The Brookfield Global Transition Fund will be just the first fund in what we believe will be a very attractive growth avenue for Brookfield.

The the Brookfield Global transition fund will be just the first fund in what we believe will be a very attractive growth Avenue for Brookfield.

Speaker 2: We see the potential for this business to grow to $200 billion plus for Brookfield over the coming decades.

We see the potential for this business to grow to 200 billion plus dollar for Brookfield over the coming decades.

Speaker 2: Similar to our other platforms such as infrastructure and real estate, we are beginning with a flagship fund, but we expect that over time this theme could present the opportunity to offer a number of additional products to our investors.

Similar to our other platforms, such as infrastructure and real estate, we are beginning with a flagship fund, but we expect that over time. This theme could present the opportunity to offer a number of additional products to our investors including.

Speaker 2: including equity and debt and at various risk-return profiles across the spectrum.

Including equity and debt and that various risk return profiles across the spectrum.

Speaker 2: Lastly, we recognize that our clients' needs have grown, and that ESG has become a big theme.

Lastly, we recognize that our clients needs of ground in that ESG has become a big theme.

Speaker 2: We feel confident that we can leverage our history in renewables and the build-out of our transition business to maintain our best-in-class ESG approach within all our investment strategies.

We feel confident that we can leverage our history in renewables and the buildout of our transition business to maintain our best in class ESG approach within all our investment strategies.

Speaker 2: Over the next decade, we will continue embedding that into all our investment processes and further strengthen measurement, reporting, and disclosure around ESG.

Over the next decade, we will continue embedding that into all our investment processes and further strengthen measurement reporting and disclosure around ESG.

Speaker 2: This is a priority for our clients, and we think that this will become a critical part of how we put capital to work going forward.

This is a priority for our clients and we think that this will become a critical part of how we put capital to work going forward.

Speaker 2: Thank you all for your time, and I'll turn the call now back over to the operator for questions.

Thank you all for your time and I'll turn the call now back over to the operator for questions.

Speaker 1: Thank you. To ask a question, you will need to press star 1 on your telephone. We respectfully ask that you please limit yourself to two questions.

Thank you to ask a question you will need to press star one on your telephone with respective we ask that you. Please limit yourself to two questions to withdraw your question. Please press the pound key.

Speaker 1: To withdraw your question, please press the pound key. Please stand by while we compile the Q&A roster.

Please standby, while we compile the Q&A roster.

Speaker 1: Our first question will come from Sherilyn Radborn with TD Securities. Please go ahead.

Our first question will come from Cherilyn Radbourne with TD Securities. Please go ahead.

Speaker 5: Thanks very much and good morning. In terms of the discussion regarding the separation of an asset like manager, can you expand a little more on how you weigh that internally, just considering the flexibility that the balance sheet has provided historically versus the opportunities that you referred to that would open up if you had a more appropriately valued asset manager?

Thanks, very much and good morning.

In terms of the discussion regarding the separation of an asset manager can you expand a little more on how you weigh that internally just considering the flexibility that the balance sheet has provided historically.

Versus the opportunities that you referred to.

Would open up if you had it more appropriately valued asset manager.

Speaker 4: Hi, Sherilyn, it's Nick. I think, as Bruce laid out, we talked in the letter, we've always been focused on delivering strong returns to shareholders. And over the last 20 years, we've realized 20%. And we've achieved that by deploying capital for value and evolving with financial markets. We've done it in the past and we're always...

Hey, Sharon it's Nick.

I think.

As briskly, though we talked in the letter we've always been focused on delivering strong returns to shareholders over the last 20 years, we've realized 20%.

And we've achieved that by deploying capital for value and evolving with financial markets. We know we've done it in the past and we're always wanting to make sure that we're evolving with markets and two things have happened over the last few years, one of our asset management business has achieved significant scale on it has has benefits of <unk>.

Speaker 4: wanting to make sure that we're evolving with markets. And two things have happened over the last few years. One, our asset management business has achieved significant scale, and it has benefits of being close to capital, and that has benefited us as we've grown the business.

Close to the capital and that has benefited us as we've grown the business from its infancy, but no as of a position where it's one of the largest asset managers in its own right with a strong growth profile.

Speaker 4: from its infancy but now is of a position where it's one of the largest asset managers in its own right with a strong growth profile. And secondly, the markets have evolved.

Secondly, the markets have evolved.

Speaker 4: and currently have a clear preference for AssetLight. And to Bruce's point, we listen to the market. And we often look to respond accordingly. We believe this is spinning out a part.

Currently have a clear preference for asset light.

And to Bruce's point, we listen to the market.

We often look to respond accordingly, we believe that spending at a part.

Speaker 4: of the manager would allow investors the one access to just that asset light part of the business, that access without maybe losing the overall synergies that we have in the business.

Of the manager with a lot of investors that want access to just that asset light part of the business that accept with access without maybe losing the overall synergies that we have in the business.

Speaker 5: Okay, I'll let others pick that up. I'm sure you're gonna get lots of questions. I did wanna ask one about the wealth channel, which the old asset management industry has really just only started to tap. Can you talk about how much of your feed there in capital and current fundraising is coming from that channel, but also how do you factor in the significant retail ownership of the perpetual affiliates when you think about your scale in retail or wealth?

Okay.

I'll, let others take about that Im sure youre going to get lots of questions I did want to ask one about the wealth channel, which the.

Asset management industry has really only started to Pat can you talk about how much of your fee bearing capital in current fundraising in coming from that channel, but also how do you factor in the significant retail ownership that perpetual affiliates. When you think about your scale in retailer well.

Speaker 4: Yeah, that's a good question, Sherilyn. I think on the private fund...

Yes, that's a good question Sharon I think on the on the private fund fund raising.

Speaker 4: fundraising, it was in that 7 to 10% range and it's coming from that private wealth channel of our fee bearing capital. But you're right to observe that, you know, with our listed affiliates, we also have, you know, a really strong retail following and a retail product through that channel. So that does play into it. For the business,

It was in that 7% to 10% range and Thats coming from the private wealth channel of our fee bearing capital, but you are right to observe that.

With our listed affiliates, we also have.

Really.

A strong retail following in our retail product through that channel.

So that does play into it.

For the business as you know.

Speaker 4: As you know, we have been building out our retail marketing efforts with the creation of Brookfield Oak Tree Weld Solutions and with the creation of the distribution capabilities.

We have been building out our retail marketing efforts with the creation of <unk>.

Field, <unk> solutions and with the accretion of the distribution capabilities and we've been selling existing products, but also.

Speaker 4: and we've been selling existing products but also creating new products that are specifically designed and resonate with that channel with the private REIT being the first but I think there's more to follow and I think it's just an extension of what we already do and some of our products and where we have that expertise and we can leverage the platforms that we have and so there should be more products to follow and we think that it will be a good source of capital going forward.

Creating new products that are specifically designed and resonate with that channel with the private REIT being the first but I think there's more to follow and I think is just an extension of what we already do and some of our products and where we have the expertise and we can leverage the platforms that we have.

And so there should be more products to follow and we think that it will be a good source of capital going forward.

Speaker 1: That's my two. Thank you. Thank you. Thank you. Our next question will come from Mario Saric with Scotiabank. Please go ahead.

That's my two thank you. Thank you.

Thank you. Our next question will come from Mario <unk> with Scotiabank. Please go ahead.

Speaker 6: All right, thank you. Good morning. Just coming back to the potential.

Alright, Thank you and good morning.

Just coming back to the potential.

Speaker 6: asset manager spin out, I think you've referenced a couple times the potential to spin out or separate a part of the manager. So if we sit back and just think about intrinsic value of the company today, the invested capital, as you pointed out in the value of the asset manager, is the part in reference to differentiating between kind of public and private fee streams? I'm just hoping you can expand on how you define part in terms of the options that you're considering.

Understood Alright, Thank you referenced a couple times the potential to spin out or separate a part.

The manager so if we sit back and just think about intrinsic value of the company.

Invested capital as you pointed out the value of the asset manager.

The park and lessons to differentiate between kind of public and private fee streams.

I'm, just hoping you could expand on how you define part in terms of the options that you're considering.

Speaker 4: Yeah, part Mario more just refers to the actual percentage of the manager that we spend into public hands. You know, maybe the public would own x percent of the business and Brookfield parent would still own a meaningful part of the business. Meaning if people have a preference to invest in asset light, they can invest directly into the manager or for those that have that want to invest in the manager and the capital. That's the option we're still using.

Yes, part Mario more just refers to the actual percentage of the manager that we spend into public hands.

May be publicly to own X percent of the business and Brookfield parent would still own a meaningful part of the business, meaning if people have a preference to invest in asset light they can invest directly into the manager or for those that have.

Want to invest in the manager and the capital that's still option would still exist.

Speaker 6: Got it. Okay. And then I guess there's

Okay Alright.

And then I guess there is.

Speaker 6: There's a couple different ways you can go about doing it in terms of separating asset manager from the from the investment capital. What are kind of some of the ways that you're thinking about today? Or is it too early to say?

There was a couple of different ways you can go about doing it in terms of suffering as a manager.

But the capital what are some of the ways that you're thinking about that or it's really.

Speaker 4: It's too early to say. I think those parts we're working through and it's too early to talk through that in detail.

Okay.

It's too early to say I think those.

We're working through and it's too early to talk through that in detail.

Speaker 6: Okay, and then just my second question just pertains to real estate asset dispositions. It seems like there's daily headlines of BAM selling assets as you pointed out in your valuations. Do you have an expected range of real estate dispositions of BAM share for 2022 and if so where do you think most of the focus will come from in terms of geography and asset types?

Okay.

And then just my second question is pertained to real estate.

<unk> it seems like.

Good morning.

We've been selling assets as you pointed out a good valuations.

You Havent expected range of real estate dispositions Bam share fruit.

2022, and if so where do you think most of the focus will come from in terms of geography.

Speaker 4: Yeah, Mario, I don't think we have an unexpected range. But we whole obviously have

Yes, I don't think we have unexpected range.

But we all obviously have.

Speaker 4: assets that we've executed the business plan on and we think if the markets are right then they are candidates to sell in line with what we laid out at investor day. We executed a lot in Q4 and we have others coming and I'd say it's broadly spread geographically and by asset class.

Assets that we've executed the business plan on and we think if the markets are right. Then they are candidates to sell in line with what we laid out at Investor Day, we executed a lot in Q4, and we have others coming in I would say, it's broadly spread geographically and by asset class.

Speaker 4: As Bruce said, others are catching up. You know, retail is probably the one that the ground on the data is excellent and the leasing activity, the spreads are back, the performance is great. Maybe sales for retail might not be the immediate focus, but other asset classes where capital is flowing significantly, we're being very active. You know, most of the information today may not be local finance, but it's still not a social-nia program at all.

As Bruce said, others are catching up.

Retail is probably the one that the ground on the data is excellent.

On the leasing activity the spreads are back at the performance is great.

Maybe sales for retail.

It might not be the immediate focus, but other asset classes, where capital is pulling significantly.

We're being very active.

Thank you those are my two.

Speaker 1: Thank you. Our next question will come from Sohrab Mulvihady with BMO Capital Market. Please go ahead.

Thank you. Our next question will come from Sohrab <unk> with BMO capital markets. Please go ahead.

Speaker 7: Thank you. I just wanted to also maybe start off by thinking about

Yes. Thank you I just wanted to also.

Maybe start off by thinking about.

Speaker 7: the scheme you're talking about to make sure that the underappreciated value of the asset manager is

Alright.

You are talking about to make sure that.

The underappreciated value of the asset.

Speaker 7: is realized. I mean, Nick, in the past we've talked about maybe buybacks as a way of extracting some of that value.

Which areas.

As realized yet.

In the past, we've talked about maybe buybacks as a way.

<unk>.

Extracting some of that value.

Speaker 7: And I wonder if you could even talk a little bit about where we are on that, but also what about distributing some of that invested capital to the bank shareholders?

And I Wonder if you could even talk a little bit about where we are on that but also what about distributing some of their invested capital to the bank shareholders.

Speaker 7: I guess the essence of the question being why would the Holtzko, if you will, then not trade out of this.

I guess.

The essence of the question being why with the Holdco.

If you will than not trade at a discount.

Speaker 7: if you had this spin out. So I'm just trying to think through a bunch of these things if you can.

Hi.

So I'm just wondering as you've gone up thanks to a bunch of these things if you can please.

Speaker 3: It's Bruce, so maybe I'll take a shot at trying to answer your question. And if, look, our thinking is that our job is run a great business, which we're still trying to do, and to unlock shareholder value when it makes sense.

It's Bruce so maybe I'll take a shot at.

Trying to answer your question.

Look our thinking is that our job is run a great business, which we're still trying to do and to unlock shareholder value when it makes sense in the eye and optimize our structure.

Speaker 3: If we can have our cake and eat it too, i.e. we can have our capital up top, investors that want to invest into the parent company.

If we can have our cake and eat it too.

I E. We can have our capital up top investors that want to invest into the parent company will stay there and keep their shares in that company and they will have us invest their capital plus that alone are part of the manager but.

Speaker 3: stay there, keep their shares in that company and they'll have us invest their capital plus they'll own a part of the manager.

Speaker 3: if we list part of manager separately, it would enable those investors who choose to or want to own an asset manager the ability to do that.

If we less part of manager separately, it would enable those investors who choose to or want to own an asset light asset manager the ability to do that.

Speaker 3: if either of those securities in the future don't trade properly.

If either of those securities in the future don't trade properly.

Speaker 3: We can always buy shares back into the Treasury and continue to increase value by.

We can always buy shares back into the treasury.

<unk>.

And continue to increase value by if they're trading less than fair value. So the bottom line is all of those options are open all we're trying to do is maximize the value of the business.

Speaker 3: trading less than fair value. So, you know, the bottom line is all of those options are open. All we're trying to do is maximize the value of the business in the longer term. And so all the things you say are possible.

In the longer term and.

So all the things you say are possible.

Okay. That's it for me thank you.

Speaker 1: Thank you. Our next question will come from Robert Lee with Keith Brouillette and Woods. Please go ahead. Great, good morning. Thanks for taking my questions.

Thank you. Our next question will come from Robert Lee with Keefe Bruyette <unk> Woods. Please go ahead.

Great. Good morning, Thanks for taking my questions maybe just.

Speaker 8: Sticking with the theme of the day on the potential spin, so it kind of sounds like this is something on a high level, don't want the words in your mouth, but maybe you've decided. So really, is at this point just kind of going through the mechanics of how that would look, and the tax and the tax, so.

Sticking with the theme of the day.

The potential spin so.

It sounds like.

Something.

On a high level.

One of the words in your mouth, but maybe you've decided so really at this point just kind of going through the mechanics of how that would look any tax impacts so.

Speaker 8: Again, kind of like we think this will be a good thing, but now we just got to work through the mechanics of it. Is that kind of pretty much where you're at right now?

Again kind of like we think this will be a good thing, but we know we just got to work through the mechanics of it is that kind of pretty much where where youre at right now.

Speaker 3: You know, look, I would, the bottom line is we think it's

Look I would.

Bottom line is we think.

Speaker 3: very executable plan. It's now in the public. All of our owners can express their views to us and we're going to come up with the right plan based off of all that plus the information we have. So we're heading down a path and we're quite serious about it or we wouldn't have put it in the letter the way we did.

It's a very executable.

Plan.

It's now in the public all of our owners can express their views to us and.

And we're going to come up with the right plan based off of all of that plus the information we have.

So were heading down a path and we're quite serious about it or we wouldn't have put it in the letter the way we did.

Okay, Great and then maybe.

Speaker 8: Shifting gears a little bit to fundraising, I mean, clearly for you guys going gangbusters, you've seen it actually across many of your peers. So I'm just curious, number one, are you seeing any signs of, I don't know, lack of a better way of putting it, fatigue among LPs? I mean, clearly we know there's secular demand here given the rate environment and whatnot, but are you starting to see, at least on an interim basis, kind of getting this impression that LPs are flooded with fund offerings?

Shifting gears, a little bit the fund raising I mean, clearly you guys are going gangbusters, you've seen actually across many of your peers. So I'm. Just curious number one are you seeing any signs of lack of a better way of putting it fatigue among Lps.

We know there is secular demand here, given the rate environment and whatnot, but you.

Starting to see at least on an interim basis kind of get to getting this impression that Lps are flooded with fund offerings and that maybe there has been slow this down pushback or are you seeing any signs of that that may change, how youre impact how youre thinking about the timing of fund closings at all.

Speaker 8: and that maybe there's been like slow this down push back are you seeing any signs of that that may

Speaker 8: change how you're impact how you're thinking about the timing of fun closes at all.

Speaker 3: I'll give you a short answer, no. Look, the longer answer is we're in a very low infrared environment. As noted in the letter, 8...

I'll give you a short answer no.

Look the longer answer is we're in a very low interest rate environment as noted in the letter eight eight.

Speaker 3: eight interest rate hikes gets your short rate to 2%. So we're in a very low environment, especially when the products that we try to invest for clients—

Eight interest rate hikes gets your short rate to 2%.

So we're in a very low environment, especially when the products that we.

Invest for our clients earn six on the low end and <unk> 25 on the high end.

Speaker 3: six on the low end and 25 on the high end. These are very attractive products and there doesn't seem to be any reason to have that slowdown. Go to Beadaholique.com for all of your beading supplies needs!

These are very attractive products and there doesn't seem to be any reason to have that slowed down.

Sure.

Great. Thanks for taking my questions.

Okay.

Speaker 1: Thank you. Our next question will come from Jeff Kwan with RBC Capital Markets. Please go ahead.

Thank you. Our next question will come from Geoff Kwan with RBC capital markets. Please go ahead.

Speaker 9: Hi, good morning. Just going back to the asset manager potential spin.

Hi, good morning, just going back to the asset manager potential spin.

I'm just wondering is.

Speaker 9: Obviously, you've talked about it's still a little bit preliminary, but would any sort of spin off have at least theoretically the potential?

Obviously, you've talked about it's still a little bit preliminary but.

Any sort of spin off.

Theoretically the potential.

Speaker 9: to change the relationship with BIPBEP, BPG, BBU, in terms of management services agreement, whether or not it's financial terms or other, as opposed to keeping the status quo? Or is that probably one of the considerations as you think about what ways to go about doing it, if you decide to go with the spin?

To change the relationship with PPD.

TPG Btu in terms of management services agreement, whether or not its financial terms or rather as opposed to keeping the status quo.

Or is that probably one of the.

Considerations as you think about what.

We used to go about doing it if you decided to go with the spin.

The short answer is we would expect no change.

Okay.

Speaker 9: And then my second question was just on the Global Transition Fund. I mean, it sounds like obviously the opportunity is large and numerous. I'm just trying to, I guess, understand a little bit how you're going about figuring out where to focus on where the best opportunities are, whether or not it's the renewable assets themselves or...

And then my second question was just on the on the global transition Fund I mean, it sounds like obviously the opportunity is large.

Numerous im just trying to I guess understand a little bit and how youre going about seeking out where to focus on.

Where the best opportunities are whether or not it's the renewable assets themselves.

Speaker 9: making investments with operating companies that need help with the transition? Are there certain geographies that are more attractive at some point?

Making investments with operating companies that need help with the transition are there certain geographies that are more attractive that sort of thing.

Speaker 2: Sure, Jess. I'll take that. It's Natalie here. First of all, the immediate first place we're starting is renewable energy. When you look at the range of decarbonization solutions that are available for corporates today.

Sure, Jeff I'll take that it's not only here.

First of all the immediate first place we're starting into renewable energy. When you look at the range of Decarbonization solutions that are available for corporates today.

Speaker 2: thinking about cleaning up their scope two emissions, so cleaning up how they purchase their electricity or reducing their electricity consumption by the way of investing in things like distributed generation. That is the best way for corporates today to make an immediate impact on their carbon footprint and to help buy them time as they max their production.

Thinking about cleaning up their scope two emissions, so cleaning up how they purchase their electricity or reducing their electricity consumption by the way of investing in things like distributed generation that is the best way for corporate today to make an immediate impact on their carbon footprint and to help by them.

Time.

Speaker 2: the cost of other decarbonization technologies comes down.

The cost of other Decarbonization technologies comes down that's the absolute first place will start, but I would say, what's exciting and particularly why we mentioned that we're going to be spending time with.

Speaker 2: That's the absolute first place we'll start. But I would say, what's exciting and particularly why we mentioned that we're going to be spending time with...

Speaker 2: the hard to abate sectors like steel, cement and chemicals is because the timeline for those companies to implement their solutions will take 5 to 10 years to invest in the infrastructure to actually enable them to decarbonize by 2030. And so those capital projects are starting now and those conversations are starting now and we're having active dialogue with all of them. And we will focus on those that have the most

The hard to abate sectors like steel cement and chemicals is because the timeline for those companies to implement their solutions will take five to 10 years to invest in the infrastructure to actually enable them to decarbonize by 2030, and so those capital projects are starting now and those <unk>.

<unk> stations are starting now and we're having active dialogue with all of them and we will focus on those that have the most.

Speaker 2: the highest energy intensity and the largest capital need is where we're seeing the most opportunities to add value.

The highest energy intensity and the largest capital need Thats, where were seeing the most opportunities to add value.

Okay, great. Thank you.

Yeah.

Speaker 1: Thank you. Our next question will come from Alexander Bloestein with Goldman Sachs. Please go ahead.

Thank you. Our next question will come from Alexandra <unk> with Goldman Sachs. Please go ahead.

Yes.

Speaker 8: Thanks, everybody. Good morning for taking the quick Good morning and thanks for taking the question. So back to the structure. So for what it sounds like you're really considering the spin off to be not really separation, but more of the tractor stock, they'll just give investors an opportunity to play the kind of pure asset management side of the business. So a just want to understand that that's correct and be

Thanks, everybody good morning for taking the question. Good morning, Thanks for taking the question.

So back to the structure so from what it sounds like you really considering the spin off to be not really separation, but more of that cracker sock they'll just give investors an opportunity to play the kind of pure asset management side of the business. So just want to understand if that's correct and b.

Speaker 8: I guess what is your timing in ultimately in terms of the structure? How should ultimately investors think about the cash flows that will be coming into that vehicle? Meaning that are you guys going to distribute it? Are you going to retain?

I guess what is your timing in ultimately in terms of the structure Hartford ultimately investors think about the cash flows that will be coming into that vehicle meeting that are you guys going to distribute it are you going to retain it and currently you guys have a pretty material tax shield.

Speaker 8: And currently you guys have a pretty material tax shield, given that everything's combined at the BAM umbrella. Are you going to be able to retain the tax shield or the kind of earning from the new CO, the asset manager will be taxed at a typical rate?

Given that everything is combined at the Bam umbrella are you going to be able to retain the tax shield or the kind of earnings from the newco the asset manager will be taxed at a typical rate.

Speaker 3: Bruce, I think you asked four questions. I'll try to be quick, although I'm not going to try, I'm not going to get into too much detail on this call until we have more fulsome answers for you. I'll try to answer three. First, you said is the security going to be a security or a tracking stock? It will be a full security and a listed company.

It's Bruce I think you asked four questions. So I'll try to be quick, although im not going to I'm not going to get into too much detail.

On this call.

Until we have more fulsome answers for you.

I'll try to answer three.

First you said is the security is going to be a security or a tracking stock it will be a full security in a listed company.

Speaker 3: the BAM parent may own a part of it and we're going to separate and distribute to our shareholders a part of the business.

The band parent may own a part of it and we're going to separate.

And distribute to our shareholders are part of the business.

Speaker 3: a quarter, a third, whatever that number is to start off with. But it will be a separately listed security.

A quarter or third whatever that number is to start off with.

But it will be a separate separately listed security.

Speaker 3: As to payout, we'll have to consider that based on all the other securities are out there and what's best for the shareholders. But there will not be a lot of need for cash in the company, so it could have a full payout of its cash flows if we so choose.

As to payout will have to consider that based on all the other securities are out there and what's best for the shareholders.

But there will not be a lot of need for cash in the company. So it could have a full payout of its cash flows if we so choose.

As to the shields, we have within the business, we will allocate them to the right spot.

Speaker 3: shields we have within the business, we'll allocate them to the right spot at the time when we list the security and everyone will know about that.

At the time, when we list the women with the security and everyone will know about that at this time.

Speaker 8: Great. Thanks so much. And then, I guess my second question or maybe second topic, when I circle back on the wealth business, it sounds like you guys are on four platforms now, up from one earlier or late last year. I'm curious to get your take on what the reception has been from financial advisors.

Great. Thanks, so much and then.

Yes, My second question or the second topic, what I circle back on the wealth business. It sounds like you guys are on four platforms now up from one.

Earlier.

Last year I'm curious to get your take on what the reception has been from financial advisors.

Speaker 8: kind of key gatekeepers to the product. Any update you have for us in terms of monthly flows would be helpful. And ultimately, what would you consider a sort of success from this channel over the course of the year.

Kind of key gatekeepers to the product.

Any update you have for us in terms of monthly flows would be helpful and ultimately what would you consider sort of success.

From this channel.

Over the course of the year.

Look we're early days, we've put together both Brookfield Oaktree well.

Speaker 3: nine months ago and it's had a very meaningful impact with our relationships with the Wealth Channel.

Six nine months ago and.

It's.

Had a very meaningful impact with our relationships with the wealth channels I think it could be it will be very meaningful going forward.

Speaker 3: It could be, it will be very meaningful going forward, but we're just starting into it. So I don't really have a prediction for you.

But we're just starting into it.

I don't really have a prediction for you as to the numbers that will be.

Coming in on a monthly basis, but.

But the early indications are that our.

Products like they are to institutional clients will be highly attractive to wealth and we.

Speaker 3: pick the right ones to put into those channels. And, we're

We need to pick the right ones to put into that those.

<unk> and <unk>.

We're going to do that.

Great. Thanks, so much.

Speaker 1: Thank you. Our next question will come from Andrew Cuskey with Credit Suisse. Please go ahead.

Welcome. Thank you. Our next question will come from Andrew Kuske with Credit Suisse. Please go ahead.

Speaker 6: Thanks. Good morning. I guess one of the key principles from Brookfield on a longer term basis has been compounding historically and we'll see highlights of this in the morning as the miracle of finance.

Thanks, Good morning, I guess, one of the key principles on a longer term basis, we can compound that historically I mean, you highlighted listen to one of those more bankers.

A miracle of finance.

Speaker 6: Could you maybe just step back a little bit and address your businesses? Are you seeing multiplier effects across...

Could you maybe just step back a little bit and address your businesses are you seeing multiplier effects occur.

Across some of the businesses.

Speaker 6: as they interact together. And maybe one example would be just what we can do on the residential front, the residential infrastructure being HVAC, multi-family distributed generation. Do you see multiplier effects across those businesses as they're now sort of merging together to a certain degree from an opportunities standpoint?

As they interact together and maybe one example would be just what it can do on the residential front too.

Residential infrastructure HVAC multifamily distributed generation.

The multiplier effects across those businesses they are now.

<unk> merging together to a certain degree from an opportunity standpoint.

Speaker 3: Yeah, look, I think that part of the success of our business is that we've tried to keep in mind that we've tried to keep in mind that we've tried to keep in mind that we've tried

Yes look.

I think part of the success of our <unk>.

Business is that we.

We've tried to keep ensure that we coordinate all of the affairs within the business and therefore, many of our groups work together and when we find new ideas, we try to flow them across different areas. So.

Speaker 3: and therefore many of our groups work together. And when we find new ideas, we try to flow them across different areas. So I think it just helps.

I think it just it helps when you have a big broad platform to be able to do that and maybe even as important is when we learn something in one country.

Speaker 3: you have a big broad platform to be able to do that and maybe even as important is when we learn something in one country.

Speaker 3: it may not have been applied the same way in 29 other countries that we're in. And therefore, we can take our businesses and globalize them. So many of the things that we're doing today and are taking ideas that we have in one country that we found that are really successful and applying them in other areas, doing the same thing but doing it in another country where it hasn't been done before and both from an operating and a financial perspective that has been extremely

It may not have been applied the same way in 2009 other countries that we're in and therefore, we can take our businesses and.

Globalize them. So many of the things that we're doing today.

Our taking ideas that we have in one country that we found that are really successful and applying them in other areas. It's doing the same thing, but doing it in another country, where it hasnt been done before in both.

From an operating and a financial perspective that.

It has been extremely.

Positive for the for the business.

Speaker 6: That's helpful. And that may be related to that slightly different as you look at the market conditions now globally, where there's a bit more volatility, some inflation concerns in parts of the world, uneven economic recovery, your positions in multiple markets, you know, do you see the transactional environment and potential now in the outlook in the next 12 months as being more favorable from a deployment standpoint than what you saw in the last 18.

That's helpful and then maybe related to that slightly different.

You look at the market conditions now globally.

Where there's a bit more volatility some inflation concerns in parts of the world on uneven economic recovery Youre positioned in multiple markets.

You see the transactional environment and potential now and the outlook in the next 12 months as being more favorable from a deployment standpoint than what you saw in the last 18 months.

Yeah.

Speaker 3: Look, there's never a perfect environment because when...

Look there is never a perfect environment because when.

Speaker 3: When there's no money available, there's usually lots of opportunity. When there's lots of money available, there's less opportunity.

When there is no money available theres, usually lots of opportunity and when theres lots of money available as there is less opportunity.

Speaker 3: But I would just say that given our broad platform in many countries and we're in multiple sectors.

But I would just say that.

Given our broad platform in many countries and we're in multiple sectors.

Speaker 3: There's never, every one of them doesn't offer opportunities, but there's always something.

Theres never.

Every one of them it doesn't offer opportunities, but there is always something to do and I.

Speaker 3: And I'd say today we see lots of opportunity out there.

I would say today, we see lots of opportunity out there.

Speaker 3: I'd say it's no less than it was before and a lot of them are things that you would not even

And I'd say, it's no less than it was before and a lot of them are things that you would not even.

Speaker 3: I think there should be opportunity available, but people require our capital, require our operating skills, require a partnership with somebody like us, and therefore we find opportunity. So I, there's an excellent market today for opportunities for all of our, most of our, most or all of our businesses.

I think there should be opportunity available but people.

Require our our capital require our operating skills require a partnership with somebody like us and therefore, we find opportunities so.

There is an excellent market today for opportunities for all of our most of our most or all of our businesses.

Okay. That's great. Thank you very much so much.

Speaker 1: Thank you. Our next question will come from Bill Cast with City Group. Please go ahead.

Thank you. Our next question will come from Bill Katz with Citigroup. Please go ahead.

Speaker 8: Okay, thank you very much for taking the questions. So just coming back to Spin yet again, I apologize. So I guess maybe the conceptual question for me, why not spin the whole asset management business or spin the invested capital platform? How do you think about milestones here just to keep the market abreast of your thinking? Thank you.

Thank you very much for taking the questions. So just coming back to spin yet again, so I apologize.

So I guess, maybe a conceptual question for me.

Why not spin the whole asset management business or spin the.

Invested capital platform and how you think about milestones here just to keep the market abreast of Youre thinking thank you.

Okay.

Speaker 3: So look, here's what I would say. If we create the most value by entirely separating the business, we would do it.

So look here's what I would say.

If we create the most value by entirely separating the business we would do it.

Speaker 3: Our view today is that having the capital company have an interest in the manager to be able to align itself and put its capital and have its capital managed in a fashion that it's happy about is the right way to go. But over time, if that made sense, we could do it in four steps or we could do it in one all up front. But our view today is that...

Our view today is that having the capital company have an interest in the manager to be able to align itself and put its capital and habits capital manage.

Fashion.

Happy about is the right way to go.

But over time, if that made sense, we could do it in four steps or we could do it in one all upfront.

But our view today is that.

<unk> is creating the asset light manager listing part of it.

Speaker 3: creating the asset light manager listing part of it is the way to go, but if owners of ours have views, we'd be pleased to talk.

Is the way to go but.

<unk>.

If owners of ours have views, we'd be pleased to talk about it.

Speaker 8: Okay, and just to follow up, you had mentioned that your current form is holding you back in certain growth opportunities. I was wondering if you could expand a little bit about what the holdbacks are and what growth opportunities you see and then which comps were you using to value the asset management business?

Okay, and just just a follow up you had mentioned that your current form is holding it back in certain growth opportunities I was wondering if you could expand a little bit about what the hold backs are and what growth opportunities you see in which comps where you're using to value the asset management business.

Speaker 3: I'm going to let Nick deal with the second one. But what I would say is, just to be crystal clear,

I'm going to let Nick deal with the second one.

But what I would say is just to be crystal clear we've.

Speaker 3: We've compounded at 20% for 20 years. So there aren't any holdbacks here. What our job is to do, our job is to look at the business.

We've compounded at 20% for 20 years, so there arent any hold backs here what our job is to do our job is is to look at the business.

Speaker 3: run a great business, unlock shareholder value as we can. That's what we're in business to do.

<unk>, a great business unlock shareholder value as we can that's what we're in business to do and.

Speaker 3: Our view, therefore, is just we should keep at that effort. And if we have securities that trade properly in the marketplace at their fair value.

Sure.

Our view therefore is just we should keep at at that.

At that effort.

And.

If.

If we have securities that trade properly in the marketplace at their fair value. It opens up options to use those securities for something you want to do in the future if the opportunity presents itself.

Speaker 3: it opens up to options to use those securities for something you want to do in the future if the opportunity presents itself.

Speaker 4: Bill, it's Nick on the second question. It's consistent with what we used at our investor day. So 25 to 40 on FRE and 10 on our target carry.

And Bill it's Nick on the second question, it's consistent with what we used at our Investor day, So 25% to 40 on FRE and turn on.

Our target carry.

Thank you very much.

Speaker 8: Thank you. We do have a follow-up question from Robert Lee with Keith, Gugliel, and Wood. Please go ahead. Great. Thanks for taking my follow-ups. Maybe sticking with fundraising and not to spend.

Thank you we do have a follow up question from Robert Lee with Keefe Bruyette <unk> Woods. Please go ahead.

Great. Thanks for taking my follow ups, maybe sticking with the fund raising.

And not to spend.

Speaker 8: you know it really maybe a two-parter so mean that if i look at the number of strategies outside of the flagship strategy that you have in market i think you pointed out something like thirty five in units really kind of expanded tremendously the last bunch of years uh... so

So.

Really maybe a two parter so I mean, if I look at the number of strategies outside of the flagship strategies that you have in market. I think you pointed out something like 35, I mean, it's really kind of expanded tremendously less bunch.

A bunch of years.

So.

Speaker 8: I'm just curious, I mean, could you maybe give us a sense of...

I'm just curious I mean could you maybe give us a sense of that.

Speaker 8: of how you actually have maybe changed your organization or how you go to market to actually try to maximize that because have so many things in so many places.

Of of how you actually have maybe changed your organization or how you go to market to actually try to maximize that because so many things in so many places.

Speaker 8: you know, how do you make sure you're kind of not missing opportunities or maximizing your potential there and then

How do you make sure you kind of I'm missing opportunities or maximizing your potential there and then maybe the second the second part of the fund raising is there is as you pointed out there is so much demand historically, you've taken very large.

Speaker 8: Maybe the second part of the fundraising is, you know, as you point out, there's so much demand. Historically, you've taken very large, you know, chunks of your own funds, you know. How is your own appetite for, you know, whether your participation will be 5% or 15%, you know, changing to create more capacity for third-party clients.

Hunks of your own funds you know.

How is your your own appetite for weather.

Whether your participation will be 5% or 15% changing too to create more capacity for third party.

Clients.

Speaker 4: Hey, Rob. Yeah, so on the first part, you know, I think the number of complementary strategies has really evolved as the scale and size of each of our businesses has evolved. So how we have evolved is, you know, we have four businesses plus we have five businesses.

Yes, so on the on the first part.

I think the the null.

Number of complementary strategies has really evolved.

The scale and size of each of our businesses has evolved we have evolved as we have four businesses plus we have all three supply businesses and each of those businesses have client relationships and as clients have allocated more and more capital to alternatives and have looked for solutions I would say up and down the capital stack with <unk>.

Speaker 4: And each of those businesses have client relationships. And as clients have allocated more and more capital to alternatives and have looked for solutions, I'd say up and down the capital stack with different risk profiles. We are

Isn't risk profiles.

We have the the.

Speaker 4: the investing and the operating expertise and the experience to offer in those products across the channels. So it's really a leveraging the platforms that we have and catering to our clients needs and providing them with these products. And we start as Natalie said, like we're doing in transition, we started with the flagship funds, but that knowledge and expertise, translates well to scaling up a core offering in the same sectors with different risk or profile.

Investing in the operating expertise and the experience to offer them those products across the channels. So it's really leveraging the platforms that we have in catering to our clients' needs and providing them with these products and we start as Napoli said like we're doing in transition we started with the flagship funds, but that knowledge and expertise translate.

Well to scaling up the core offering in the same sectors with different risk score profile.

Speaker 4: and adding a couple of investment professionals to lead each strategy, but really leveraging the underlying platform to inform our decision-making, our diligence, and then operating when we own the asset. So I'd say that's how we have evolved and we stay on top of it by having close relationships with our clients and responding to their needs.

Adding a couple of investment professionals to lead each strategy, but really leveraging the underlying platform to inform our decision, making our diligence and then operating when we own the asset. So I'd say, that's how we have evolved and we stay on top of it by having close relationships with our clients and responding to their needs and that has led to the short term products and as we.

Speaker 4: and that has led to this growth in products. And as we later investigate, real estate is probably the most evolved and our other businesses are evolving quickly with new products all the time and catering to new channels as we go.

At our Investor Day real estate is probably the most evolved on our other businesses are evolving quickly with new products, all the time and catering to new channels as we go.

Speaker 4: On our own appetite, I would say that as the size of the funds is growing, it's a decision we make each time, but the absolute dollars are still significant. So percentages may change, but the dollars are meaningful, which shows our conviction in the funds and still creates that strong alignment of interest. So it evolves over time, but the capital is still meaningful.

On our own appetite I would say that.

The size of the funds is growing.

We make each time, but the absolute dollars are.

Still significant so percentages may change, but the dollars are meaningful.

Which shows our conviction in the funds and still create strong alignment of interest and so it evolves over time, but the capital still meaningful.

Hey, Thanks for taking my questions.

Speaker 1: Thank you and we do have a follow-up from Saurabh Movahedi with BMO Capital Markets. Please go ahead.

Thank you and we do have a follow up from Sohrab <unk> with BMO capital markets. Please go ahead.

Speaker 7: Thank you. Just a more detailed or maybe a final one. I think you mentioned

Thank you.

A more detailed or maybe a final one I think you mentioned.

Speaker 7: about 10 billion dollars of real estate.

About $10 billion.

Real estate.

Speaker 7: dispositions. Any indications as to what the plan is for that cat?

Dispositions any any indications as to what the plan is for that cash.

Speaker 4: Yes, so the 10 billion would have been the gross number of sales. I think we mentioned about a couple of billion dollars of gains. So that gains is obviously accruing to the real estate business, some being reinvested and some being repatriated to Brookfield. So it's in line with the plan that we would have laid out. We'll look for opportunities over the most optimal places to deploy that capital within the organization.

Yes, so sort of the $10 billion would have been the gross number of sales I think we mentioned a couple of billion dollars.

Of games, so that gains is obviously accruing to the real estate business, some being reinvested in some being repatriated to Brookfield. So it's in line with the plan that we would have laid out we will look for opportunities where the utmost optimal places to deploy that capital within the organization.

Speaker 7: So Nick, just to be crystal clear, it may involve making new investments in the real estate field.

So just to be crystal clear it may involve.

Making new investments in the real estate.

Speaker 4: It could do, it could do, or it could be repatriated.

It could do.

It could do or yes or.

Or it could be repatriated.

Thank you.

Sure.

Speaker 1: Ladies and gentlemen, thank you for participating in today's question and answer session. I would now like to turn the call back over to Ms. Suzanne Fleming for any closing remarks. Thank you, operator.

Ladies and gentlemen, thank you for participating in today's question and answer session I would now like to turn the call back over to MS. Suzanne Fleming for any closing remarks.

Thank you operator, and with that we will end today's call. Thank you for joining us.

Speaker 1: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.

Okay.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.

Speaker 10: ["Pomp and Circumstance"] ["Pomp and Circumstance"]

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Speaker 1: Ladies and gentlemen, thank you for standing by and welcome to the Brookfield Asset Management fourth quarter 2021 results conference call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Ms. Suzanne Fleming, managing partner. Please go ahead. Thank you, operator, and good morning, everyone. Welcome to Brookfield's fourth quarter and 2021 full year conference call. On the call today...

Ladies and gentlemen, thank you for standing by and welcome to the Brookfield asset management fourth quarter 2021 results Conference call. Please be advised that today's conference is being recorded I would now like to hand, the conference over to your Speaker Ms. Suzanne Fleming managing partner. Please go ahead.

Thank you operator, and good morning, everyone welcome to Brookfield fourth quarter, and 2021 full year conference call on the call today are Bruce Flatt, Our Chief Executive Officer, Nick Goodman, Our Chief Financial Officer, and Natalie automate managing director in our renewable power and transmission group.

Speaker 2: start off by giving a business update followed by Nick who will discuss our financial and operating results. And finally Natalie will give an update on our transition strategy. After our formal remarks, we'll turn the call over to the operator and take analyst questions. In order to accommodate all...

Bruce will start off by giving a business update followed by Nick who will discuss our financial and operating results and finally, Natalie we'll give an update on our transition strategy.

After our formal remarks, we will turn the call over to the operator and take analyst questions in order to accommodate all those who wanted to ask questions. We ask that you refrain from asking more than two questions. At a time. If you have additional questions. Please rejoin the queue and we'll be happy to take any additional questions at the end as time permits.

I'd like to remind you that in today's comments, including in responding to questions and in discussing new initiatives and our financial and operating performance. We may make forward looking statements, including forward looking statements within the meaning of applicable Canadian and U S. Securities laws. These statements reflect predictions of future events and trends and do not relate to historic events. They are subject to known and unknown.

Own risks and future events and results may differ materially from such statements.

For further information on these risks and their potential impact on our company. Please see our filings with the securities regulators in Canada, and the U S and the information available on our website and with that I'll turn the call over to Bruce.

Speaker 3: Thank you, Suzanne, and welcome everyone on the call. We reported strong...

Thank you Suzanne and welcome everyone on the call.

We reported strong results for the year.

Speaker 3: with record total net income of $12.4 billion.

With record total net income of $12 4 billion.

Speaker 3: and distributable earnings for common shareholders of $6.3 billion.

And distributable earnings for common shareholders of $6 3 billion.

Speaker 3: Results were driven by $71 billion of inflows of capital and associated fee-related earnings.

Results were driven by 71 billion of inflows of capital and associated.

Fee related earnings.

Strong performance from our principal investments and.

Speaker 3: and gains in carry received from $42 billion of asset sales, where we booked 16 bills.

And gains in carry received from $42 billion of asset sales.

Where we booked $16 billion of gains.

Speaker 3: $12 billion for clients and $4 billion which came to ban.

12 billion for clients and $4 billion, which came to Bam.

Speaker 3: As we enter 2022, the normalization of central bank monetary policy has caused volatility in the markets, mostly in sectors trading at high multiples.

As we enter 2022, the normalization of Central Bank Monetary policy has caused volatility in the markets.

Mostly in sectors trading at high multiples.

Those did not affect us in any major way.

Speaker 3: Our general view is that this has been a healthy rerating and will likely

Our general view is that this has been a healthy re rating.

And we will likely create opportunity.

Speaker 3: for our business with interest rates still very low on a relative basis.

For our business with interest rates still very low on a relative basis and expected to stay so for some time.

Speaker 3: and expected to stay so for some time.

Speaker 3: combined with the positive inflation of revenue.

Combined with the positive inflation of revenues.

Speaker 3: we are seeing a positive backdrop for most of our.

We are seeing a positive backdrop for most of our businesses.

Speaker 3: Our asset management business is continuing to attract large amounts of capital with our product offerings aligned around several positive global investment themes. Our underlying operation is to provide a more efficient and more efficient solution to the case of Moose

Our asset management business is continuing to attract large amounts of capital with our product offerings aligned around several positive global investment themes.

Our underlying operations continue to strengthen.

Speaker 3: coming out of the recession and with many of our businesses generating inflation-length cash flows or positioned to benefit from economic growth, we are well positioned.

Coming out of the recession and with many of our businesses generating inflation linked cash flows.

We're positioned to benefit from economic growth.

We are well positioned.

Turning now to our strategic initiatives 2021 was a busy year in that regard.

Speaker 3: 2021 was a busy year in that regard.

First off.

Speaker 3: spun out and paired our reinsurance business, establishing BAMR.

We spun out and paired our reinsurance business, establishing bam or.

Speaker 3: Subsequent to that, we completed a number of reinsurance agreements and committed to acquire American National, which we expect to close in the coming months.

Subsequent to that we completed a number of reinsurance agreements and committed to acquire American national which we expect to close in the coming months.

Speaker 3: American National give us a US insurance platform and provide us with direct origination capability.

American National give us a U S insurance platform and provide us with direct origination capabilities and.

Speaker 3: total, we are heading towards $50 billion of insurance AUM, and the team is just getting started.

In total we are heading towards $50 billion of insurance AUM.

And the team is just getting started.

Second we prioritized, our real estate business and.

Speaker 3: In short, we own one of the highest quality portfolios of prime properties in the world.

In short we own one of the highest quality portfolios of prime properties in the world.

Speaker 3: real estate securities were, and in fact still are, trading in the market at discounts to their fair value.

Real estate Securities were.

And in fact still are trading in the market at discounts.

So there they are fair value.

On the other hand private markets are not.

Speaker 3: BPY shareholders were offered the ability to participate in BAM. So in our view of privatization was a win-win.

BP Y shareholders were offered the ability to participate in them.

So in our view a privatization was a win win.

To date, it has turned out to be that way for everyone.

Speaker 3: In the last year, the tone of the private real estate market has improved dramatically, and liquidity in private markets is now returning to pre-pandemic level.

In the last year, the tone of the private real estate market has improved dramatically and liquidity in private markets is now returning to pre pandemic levels.

Speaker 3: The recovery started with the growth sectors like industrial and life science.

The recovery started with the growth sectors like industrial and life Sciences.

Speaker 3: followed by multifamily and is now turned to office with

Followed by multifamily is now and has now turned to office with the rest to follow.

Speaker 3: In accordance with the plans we laid out for you at the time, we recently sold approximately $10 billion of real estate across a variety of sectors.

In accordance with the plans we laid out for you at the time, we recently sold approximately $10 billion of real estate across the various variety of sectors, we realized a gain of $2 billion about purchase price last year in the sales.

Speaker 3: We realized the gain of $2 billion above purchase price last year in the sales, representing a 47% annualized gain on the asset portion of ours. A good example of this is...

Representing a 47% annualized gain on the asset portion of ours.

A good example of this is one Manhattan west which.

Speaker 3: is a phenomenal office tower in New York City we completed in 2019 in a complex where we own five other

Is a phenomenal office tower in New York City, we completed in 2019 and.

In a complex, where we own five other towers.

Speaker 3: We recently signed an agreement to sell a stake in it, which values the property at $2.9 billion, representing a 2.5 times multiple of capital and a 25% IRR.

We recently signed an agreement to sell a stake in it which values the property at $2 9 billion, representing a 2525 times multiple of capital and a 25% IRR since we started it.

Speaker 3: We're also retaining a controlling stake in the property that will continue to provide us with long-term compounding cash flows going forward.

We are also retaining a controlling stake in the property that will continue to provide us with long term compounding cash flows going forward.

Speaker 3: So as the recovery continues to gather pace, we are well positioned to strategically monetize further select assets and unlock more value in our real estate.

So as the recovery continues to gather pace, we are well positioned to strategically monetize further select assets and unlock more value in our real estate to be deployed elsewhere.

Speaker 3: Our third strategic initiative was to repackage, rebrand, and expand our renewables investing strategy into a fund for transition to net zero.

Our third strategic initiative was to repackage rebrand and expand our renewables investing strategy into a fund for transition to net zero.

Speaker 3: This culminated in a large fund which will close at $15 billion short.

This culminated in a large fund, which will close at $15 billion shortly.

Speaker 3: Natalie Adamead is here today to provide more details for you on that.

Natalie animate is here today to provide more details for you on that.

Speaker 3: Our last strategic initiative was a review of our overall structure of our asset management business as the financial market

Our last strategic initiative was a review of our overall structure of our asset management business.

As the financial markets evolve.

Speaker 3: As noted in our year-end letter, over the past 25 years, we have become one of the largest, fastest growing, and most diversified managers globally.

As noted in our year end letter over the past 25 years, we have become one of the largest fastest growing and most diversified managers globally.

Speaker 3: combined with the fact that we have very long duration annuity-like cash flows.

Bind with the fact that we have very long duration annuity like cash flows.

Speaker 3: Our manager is now at the scale that it could be separated out from the rest of our capital.

Our manager is now at the scale it could be separated out from the rest of our capital.

Speaker 3: In a market environment that seemingly perverts asset life managers, it may therefore make sense to separate part of the manager and offer investors a security that owns our asset manager separate from our capital.

In a market environment that seemingly preferreds asset light managers. It may therefore makes sense to separate part of the manager and offer investors a security that owns our asset manager.

From our capital.

Speaker 3: For backdrop, based on comparable multiples for pure play, asset light, alternative investment managers, our manager should be valued in the range of $70 to $100 billion.

For backdrop based on comparable multiples for pure play asset light alternative investment managers or managers should be valued in the range of 70 to 100 billion.

Speaker 3: This is in addition to the $50 billion of net capital that we have invested in our businesses today.

This is in addition to the $50 billion of net capital that we have invested in our businesses today.

If we separate part of the manager.

Speaker 3: this could increase the simplicity and ease of valuing our asset management business.

This could increase that simplicity and ease of valuing our asset management business.

Speaker 3: provide a security for those that wish asset life.

Provide a security for those that wish asset light.

Speaker 3: and also possibly open up new growth options for the overall business.

And also possibly open up new growth options for the overall business.

As you all know.

Speaker 3: Our business has compounded an annualized return of 20% for 20 years.

Our business is compounded in an annualized return of 20% for 20 years.

Speaker 3: Our job is always to continue to invest well.

Our job is always to continue to invest well.

Take care of our clients.

Speaker 3: and review our structure from time to time to ensure we unlock value for all shareholders. We will report on the

And review our structure from time to time to ensure we unlocked unlock value for all shareholders.

We will report on this as we move along.

Speaker 3: As always, thank you for your support. And with that, I'll turn the call over to Nick to tell you about our financial results.

As always thank you for your support and with that I'll turn the call over to Nick to.

To tell you about our financial results.

Thank you Bruce and good morning, everyone.

Speaker 4: So we had strong financial results for the year with record net income of $12.4 billion and this compares to $707 million of net income in the prior year.

So we had strong financial results for the year with record net income of $12 $4 billion and this compares to $707 million of net income in the prior year.

Speaker 4: Distributable earnings or DE for the year were $6.3 billion or $3.96 a share compared to $4.2 billion or $2.74 a share in 2020.

Distributable earnings or de for the year were $6 3 billion or $3 96, a share compared to $4 2 billion or $2 74, a share in 2020.

Speaker 4: The uplift in both net income and DE was due to excellent operating and financial performance across our business.

The uplift in both net income and <unk> was due to excellent operating and financial performance across our businesses.

Speaker 4: Our asset manager continued its strong growth trajectory supported by record levels of fundraising with total inflows of $71 billion. We ended the year with $364 billion of fee-bearing capital, an increase of 17% from the prior year.

Our asset manager continued its strong growth trajectory supported by record levels of fundraising with total inflows of $71 billion.

We ended the year with $364 billion of fee bearing capital an increase of 17% from the prior year.

Speaker 4: Inflows were supported by the continued scaling of our flagship funds as well as the success of many of our complementary product offerings.

Inflows were supported by the continued scaling of our flagship funds as well as the success of many of our complementary product offerings.

Speaker 4: During the year, we have held a final close for our latest opportunistic credit fund for $16 billion, the largest ever raised for the strategy. And we've been successful in deploying this capital at attractive returns, with this fund already approximately 75% invested or committed today.

During the year, we held a final close for our latest opportunistic credit fund for $16 billion.

The largest ever raised for this strategy and we've been successful in deploying this capital at attractive returns with this fund already approximately 75% invested or committed today.

Speaker 4: We will shortly close on $15 billion for our transition fund, and combined with our fourth flagship real estate fund, we have raised $24 billion in aggregate for those two funds to date.

We will shortly close on $15 billion for our transition fund and combined with our fourth flagship real estate fund, we have raised $24 billion in aggregate for those two funds to date.

Speaker 4: Our sixth flagship private equity fund launched fundraising in the fourth quarter, and we also recently started fundraising for our fifth flagship infrastructure fund.

Our sixth flagship private equity fund launch front launched fundraising in the fourth quarter and we also recently started fundraising for our fifth flagship infrastructure fund.

Speaker 4: And to meet our clients needs, we're also introducing new products. To give a couple of examples, our growth equity fund, which focuses on technology investments that are adjacent to our businesses, recently had a final close of over $500 million.

And to meet our clients' needs. We're also introducing new products to give a couple of examples our growth equity fund, which focuses on technology investments that are adjacent to our businesses recently had a final close to over $500 million.

Speaker 4: and we've seen an accelerated pace of deployment for this fund. And as a result, we expect to be in the market with the next vintage shortly.

And we've seen an accelerated pace of deployment for this fund and as a result, we expect to be in the market with the next vintage shortly.

Speaker 4: We also launched our real estate secondary strategy, raised $2 billion of capital for it, and have now launched a traditional commingled fund.

We also launched a real estate secondaries strategy raised $2 billion of capital for it and have no launched a traditional commingled fund.

Speaker 4: We also established a focused wealth solutions marketing group. This team is focused on developing and distributing our products into the private wealth channel. And this includes our traditional closed-end funds and new products, including our private non-traded REITs.

We also established a focused wealth solutions marketing group.

This team is focused on developing and distributing our products into the private wealth channel and this includes our traditional closed end funds and new products, including our private non traded REIT.

Speaker 4: The growth in fee-bearing capital directly resulted in higher fee-related earnings, which were $1.9 billion for the year, an increase of 33% from the prior period.

The growth in fee bearing capital directly resulted in higher fee related earnings, which were $1 9 billion for the year, an increase of 33% from the prior period.

Speaker 4: And at the business scales, we would note that our margins continue to remain stable.

And as the business scales, we would note that our margins continue to remain stable.

Speaker 4: In addition to the current capital based earning management fees, we have $40 billion of additional committed capital that when invested will translate to approximately $400 million of incremental annual fee revenues. And this is a big deal when...

In addition to the current capital base, earning management fees, we have $40 billion of additional committed capital that when invested would translate to approximately $400 million of incremental annual fee revenues.

And this is a big tailwind to add to our earnings.

Speaker 4: Looking into 2022, we expect a notable step change in our fee earnings as we receive the full benefits from the fund raised in 2021 and our ongoing fundraising initiatives.

And looking into 2022, we expect a notable step change in our fee earnings as we receive the full benefits from the funds raised in 2021 and our ongoing fundraising initiatives.

Speaker 4: As our earlier vintage funds mature, we are now realizing carried interest in each of our flagship strategies and in other complementary funds.

As our earlier vintage funds mature we are now realizing carried interest in each of our flagship strategies and in other complementary funds.

Speaker 4: We executed on a number of landmark capital recycling initiatives during the year, surfacing $42 billion of capital and crystallizing gains of $16 billion.

We executed on a number of landmark capital recycling initiatives during the year surfacing $42 billion of capital and crystallizing gains of $16 billion.

Speaker 4: we realized a record $1.7 billion of carried interest.

We realized a record $1 $7 billion of carried interest.

Speaker 4: and $2.1 billion of disposition gains from principal investors.

And $2 $1 billion of disposition gains from principal investments.

Speaker 4: Our remaining investments continue to perform very well across all our managed funds. We generated $5 billion of unrealized carried interest during the year, increasing the total accumulated unrealized carried interest by 107% to $7.7 billion, net of that realized into income.

Our remaining investments continued to perform very well across all of our managed funds we generated $5 billion of unrealized carried interest during the year, increasing the total accumulated unrealized carried interest by 107% to seven 7 billion.

Net of that realized into income.

Speaker 4: We are projecting to realize up to $1 billion of carried interest in 2022 as we continue to execute on us at Silt.

We are projecting to realize up to $1 billion of carried interest in 2022, as we continued to execute on asset sales.

Speaker 4: Lastly, our principal investments continue to provide strong and steady contributions to our distributable earnings.

Lastly, our principal investments continued to provide strong and steady contributions to our distributable earnings.

Speaker 4: This year, distributions from our investments were $2.2 billion, 19% higher than the prior year. The increase was driven by distribution growth at BIP and BEP and the higher ownership of our real estate business.

This year distributions from our investments were $2 2 billion.

19% higher than the prior year, the increase was driven by distribution growth at <unk> and bet and the higher ownership of our real estate business.

Speaker 4: Funds from operations or FFO before realizations increased 15% compared to the prior year.

Funds from operations or <unk> before realization increased 15% compared to the prior year.

Speaker 4: The increase is largely driven by the continued growth in our asset management franchise, strong organic growth across our existing operations, as well as contributions from recent acquisitions. The increase in our asset management franchise is largely driven by the continued growth

The increase was largely driven by the continued growth of our asset management franchise strong organic growth across our existing operations as well as contributions from recent acquisitions.

Speaker 4: including realizations FFO grew by 46% to 7.6 billion dollars.

Including realizations <unk> grew by 46% to seven 6 billion.

Speaker 4: And it's worth noting that going forward to further enhance and align our financial disclosure, we will use DE as the primary measure of our performance.

And it's worth noting that going forward to further enhancing our line our financial disclosure, we will use <unk> as the primary measure of our performance.

Speaker 4: Our liquidity position remains very strong. In addition to $77 billion of uncalled fund commitments, we have approximately $15 billion of core liquidity, meaning we have a total of $92 billion of deployable capital.

Our liquidity position remains very strong in addition to $77 billion of Uncalled fund commitments, we have approximately $15 billion of core liquidity, meaning we have a total of $92 billion of deployed deployable capital.

Speaker 4: This is further bolstered by our annualized DE before realization.

This is further bolstered by our annualized day before realization.

Speaker 4: Our scale capital will continue to allow us to capitalize on the interactive investment opportunities we see every day.

Our scale capital, we will continue to allow us to capitalize on the attractive investment opportunities we see everyday.

Speaker 4: Before I hand the call over to Natalie to discuss our transition strategy, I am pleased to confirm that our board of directors has declared a quarterly dividend of 14 cents a share, payable at the end of March, representing an 8% increase over the prior quarter.

Before I hand, the call over to not too late to discuss our transition strategy I am pleased to confirm that our board of directors has declared a quarterly dividend of <unk> 14, a share payable at the end of March representing an 8% increase over the prior quarter.

Natalie.

Speaker 2: Thanks, Nick. And good morning, everyone. I'm pleased to be here today to talk to you about Brookfield's new transition fund and the exciting opportunities we see for this strategy.

Thanks, Nick and good morning, everyone I am pleased to be here today to talk to you about Brookfield, New transition fund and the exciting opportunities we see for this strategy.

Speaker 2: Climate change is one of the most pressing and significant issues facing the economy today.

That change is one of the most pressing and significant issues facing the economy today.

Speaker 2: While climate change has been a focused topic for governments for years, the pace at which corporates are making commitments to lower emissions to net zero are now accelerating at a rapid pace.

While climate change has been a focused topic for government for years, the pace at which corporates are making commitments to lower emissions to net zero are now accelerating at a rapid pace.

Speaker 2: In the last two years, we've seen emissions covered by net zero commitments triple. An increase in the number of commitments of seven times for countries, five times for companies. And finally, commitments from the financial sector recognized by the Glasgow Financial Alliance for net zero increased 26 times from $5 trillion to over $130 trillion.

In the last two years, we've seen emissions covered by net zero commitments triple.

An increase an increase in the number of commitments of seven times for countries five times for companies and finally commitments from the financial sector recognized by the Glasgow Financial Alliance for net zero increased 26 times from five trillion.

<unk> to over 130 trillion.

Speaker 2: Achieving net zero emissions and more specifically the goals of the Paris Agreement will require a massive amount of capital.

Achieving net zero emissions and more specifically the goals of the Paris agreement, we will require a massive amount of capital.

Speaker 2: It is estimated that over $150 trillion will need to be invested through 2050 to drive the decarbonization of energy systems and our economy.

It is estimated that over 150 trillion.

We will need to be invested through 2050 to drive the decarbonization of energy system and our economy.

Speaker 2: That's approximately $5 trillion every year.

Thats approximately $5 trillion every year.

Speaker 2: At Brookfield, we are rising to meet this capital need and exciting investment opportunity.

At the Appeals, we are rising to meet this capital need and exciting investment opportunity.

Speaker 2: We are currently in the final stages of raising approximately $15 billion for our first flagship transition fund, the Brookfield Global Transition Fund, of which Brookfield itself will be the largest investor.

We are currently in the final stages of raising approximately $15 billion for our first flagship transition fund the Brookfield Global transition fund of which Brookfield itself will be the largest investor.

Speaker 2: and our fundraising has exceeded our expectations.

And our fundraising has exceeded our expectations. Once we reach final close we will have raised more capital and faster than we had planned and we have already started to put that capital to work.

Speaker 2: Once we reach final close, we will have raised more capital and faster than we had planned, and we have already started to put that capital to work.

Speaker 2: The success of our fundraising demonstrates that we have many like-minded investors who also recognize the urgency and the magnitude of capital required to transition the global economy to net zero.

The success of our fundraising demonstrates that we have many likeminded investors, who also recognized the urgency and the magnitude of capital required to transition the global economy to net zero.

Speaker 2: More importantly, they also understand that this investment opportunity can deliver strong financial returns and also a positive environmental impact.

More importantly, they.

I also understand that this investment opportunity can deliver strong financial returns.

And also a positive environmental impact.

Speaker 2: But more than that, our investors have chosen to invest with us because they recognize that in order to be a successful investor in decarbonization, it is essential to not only have access to capital, but to have deep operating expertise, particularly in power markets and renewables, both of which Brookfield has a proven track record in.

But more than that our investors have chosen to invest with us because they recognize that in order to be a successful investor in de carbonization. It is essential to not only have access to capital, but to have deep operating expertise, particularly in power markets Andrew.

<unk>.

Both of which Brookfield has a proven track record in.

Speaker 2: The reason this expertise is so important is because about three-quarters of global carbon emissions can be traced back directly or indirectly to power generation and the energy sector.

The reason this expertise is so important is because about three quarters of global carbon emissions can be traced back directly or indirectly to power generation and the energy sector.

Speaker 2: Every business uses energy. Therefore, if you can help decarbonize the production of energy and electricity, you can enable the decarbonization of every industry in the world.

Every business uses energy.

Therefore, if you can help decarbonize the production of energy and electricity you can enable the decarbonization of every industry in the world.

Speaker 2: And if renewables are the first step to decarbonization, we think our platform puts us in a leadership position.

And if renewables are the first step to decarbonization.

We think our platform puts us in a leadership position.

Speaker 2: Today, we own and operate one of the largest renewable power platforms globally.

To date, we own and operate one of the largest renewable power platforms globally.

Speaker 2: We are a leader in major renewable technologies, and perhaps most importantly, operate in every major power market around the world.

We are a leader in major renewable technologies and perhaps most importantly operate in every major power market around the world.

Speaker 2: We have operating and development capabilities, as well as local M&A teams sourcing and identifying decarbonization investments across every continent.

We have operating and development capabilities as well as local M&A teams sourcing and identifying de carbonization investments across every continent.

Sure.

Our fund will have two overarching goal.

Speaker 2: to generate strong risk-adjusted returns for our investors, and to deliver on meaningful decarbonization targets.

To generate strong risk adjusted returns for our investors and to deliver on meaningful decarbonization targets.

Speaker 2: While we see a very wide range of opportunities to deploy capital, which can meet these objectives, today I want to highlight just two.

While we see a very wide range of opportunities to deploy capital, which can meet these objectives.

Today I want to highlight just two.

The first of course is clean energy.

Speaker 2: Given the scale of new build clean energy required, a core theme of our transition fund will be adding clean energy to the global electricity grid.

Given the scale of Newbuild clean energy required.

Core theme of our transition fund will be adding clean energy to the global electricity grid.

Speaker 2: In fact, one of the first investments that we recently made was Urban Grid, a leading U.S. solar developer with a 20,000 megawatt development pipeline and a strong position in a high-value energy market.

In fact, one of the first investments that we recently made was urban grid, a leading U S. Solar developer with a 20000 megawatt development pipeline and a strong position in a high value energy market.

Speaker 2: we acquired the business for $650 million, with the opportunity to invest hundreds of millions of dollars into further growth in the future.

We acquired the business for $650 million with the opportunity to invest hundreds of millions of dollars into further growth in the future.

Speaker 2: This was a bilaterally sourced opportunity where our ability to transact quickly and leverage our existing commercial relationships enabled us to transact with urban grid at attractive terms.

This was a bilaterally sourced opportunity, where our ability to transact quickly and leverage our existing commercial relationships enabled us to transact with urban grid at attractive terms.

Speaker 2: And as an example of how we bring these commercial relationships to our development projects, well, the Fund has already made investments into other renewable assets for the benefit of commercial partners across various sectors, including for the likes of Amazon, Enbridge, and Scotiabank.

And as an example of how we bring these commercial relationships to our development projects well. The fund has already made investments into other renewable assets for the benefit of commercial partners across various sectors, including for the likes of Amazon.

On Enbridge and Scotiabank.

Speaker 2: A second large growth opportunity for BGTS is to use our knowledge of power markets and our operating capabilities to provide energy transition and decarbonization solutions to governments and businesses around the world that need help reaching their own decarbonization goals. This is a theme we're calling, This is a dare, this is a dare, in every titled, All

Our second large growth opportunity for Bts is to use our knowledge of power markets and our operating capabilities to provide energy transition and decarbonization solutions to governments and businesses around the world that need help reaching their own.

Decarbonization goals.

This is a theme, we're calling business transformation.

Speaker 2: Industries such as steel, cement, chemicals, and utilities all require both clean energy to lower their carbon footprints and capital to decarbonize their production processes or way of doing business. The auto industry...

Industries, such as steel cement chemicals, and utilities, all require both clean energy to lower their carbon footprint and capital to decarbonize their production processes or way of doing business.

The auto industry is an example of that.

Speaker 2: significant investment in public electrical vehicle charging infrastructure will need to be made to decarbonize the transport sector.

<unk> investment in public electrical vehicle charging infrastructure will need to be made to decarbonize the transport sector.

Speaker 2: Similarly, in the power sector, utilities require significant capital to enable them to shift from coal to gas and from gas to fuel.

Similarly in the power sector utilities require significant capital to enable them to shift from coal to gas.

And from gas to renewables.

Speaker 2: And to have a material impact, you need to be willing to go where the emissions are.

And to have a material impact you need to be willing to go where the emissions are.

Speaker 2: Our fund plans to target companies in the hard to abate energy intensive sectors, which will continue to be a fundamental part of our society for years to come. And make sure that companies in those industries have the capital and the shareholder support to put them on a viable pathway towards lower emissions.

Our fund plans to target companies in the hard to abate energy intensive sectors, which will continue to be a fundamental part of our society for years to come and make sure that companies in those industries.

As the capital and the shareholder support to put them on a viable pathway towards lower emissions.

Speaker 2: We believe that businesses on a path to net zero will benefit from premium valuations versus their peers, given the de-risk nature of their operations.

We believe.

That business is on a path to net zero will benefit from premium valuations versus their peers.

Given the Derisked nature of their operations.

Speaker 2: Therefore, by investing in this theme, we will not only achieve our desired decarbonization impact, but also generate attractive commercial returns for our investors.

Therefore by investing in this theme, we will not only achieve our desired de carbonization impact, but also generate attractive commercial returns for our investors.

Speaker 2: The Brookfield Global Transition Fund will be just the first fund in what we believe will be a very attractive growth avenue for Brookfield.

The the Brookfield Global transition fund will be just the first fund and what we believe will be a very attractive growth Avenue for Brookfield.

Speaker 2: We see the potential for this business to grow to $200 billion plus for Brookfield over the coming decades.

We see the potential for this business to grow to 200 billion plus dollar for Brookfield over the coming decades.

Speaker 2: Similar to our other platforms such as infrastructure and real estate, we are beginning with a flagship fund, but we expect that over time this theme could present the opportunity to offer a number of additional products to our investors.

Similar to our other platforms, such as infrastructure and real estate, we are beginning with a flagship fund, but we expect that over time. This theme could present the opportunity to offer a number of additional products to our investors.

Speaker 2: including equity and debt and at various risk-return profiles across the spectrum.

Including equity and debt and that various risk return profiles across the spectrum.

Speaker 2: Lastly, we recognize that our clients' needs have grown, and that ESG has become a big theme.

Lastly, we recognize that our clients' needs have grown in that ESG has become a big theme.

Speaker 2: We feel confident that we can leverage our history in renewables and the build-out of our transition business to maintain our best-in-class ESG approach within all our investment strategies.

We feel confident that we can leverage our history in renewables and the buildout of our transition business to maintain our best in class ESG approach within all our investment strategies.

Speaker 2: Over the next decade, we will continue embedding that into all our investment processes and further strengthen measurement, reporting, and disclosure around ESG.

Over the next decade, we will continue embedding that into all our investment processes and further strengthen measurement reporting and disclosure around ESG.

Speaker 2: This is a priority for our clients, and we think that this will become a critical part of how we put capital to work going forward.

This is a priority for our clients and we think that this will become a critical part of how we put capital to work going forward.

Speaker 2: Thank you all for your time, and I'll turn the call now back over to the operator for questions.

Thank you all for your time and I'll turn the call now back over to the operator for questions.

Speaker 1: Thank you. To ask a question, you will need to press star 1 on your telephone. We respectfully ask that you please limit yourself to two questions.

Yes.

To ask a question you will need to press star one on your telephone with respective we ask that you. Please limit yourself to two questions to withdraw your question. Please press the pound key.

Speaker 1: To withdraw your question, please press the pound key. Please stand by while we compile the Q&A roster.

Please standby, while we compile the Q&A roster.

Speaker 1: Our first question will come from Sherilyn Radborn with TD Securities. Please go ahead.

Our first question will come from Cherilyn Radbourne with TD Securities. Please go ahead.

Speaker 5: Thanks very much and good morning. In terms of the discussion regarding the separation of an asset like manager, can you expand a little more on how you weigh that internally, just considering the flexibility that the balance sheet has provided historically versus the opportunities that you referred to that would open up if you had a more appropriately valued asset manager?

Thanks, very much and good morning.

In terms of the business discussion regarding the separation of an asset manager can you expand a little more on how you weigh that internally just.

During the flexibility that the balance sheet has provided historically.

Versus the opportunities that you referred to.

Would open up if you had it more appropriately valued asset manager.

Speaker 4: Hi, Sherilyn. It's Nick. I think, as Bruce laid out, we talked in the letter, we've always been focused on delivering strong returns to shareholders. And over the last 20 years, we've realized 20%. And we've achieved that by deploying capital for value and evolving with financial markets. We've done it in the past and we're always...

Hi, Sharon it's Nick.

I think.

As Bruce Lee, we talked in the letter we've always been focused on delivering strong returns to shareholders over the last 20 years, we've realized 20%.

And we've achieved that by deploying capital for value and evolving with financial markets. We know we've done it in the past and we're always wanting to make sure that we're evolving with markets and two things have happened over the last few years, one of our asset management business has achieved significant scale and it has has benefits of <unk>.

Speaker 4: wanting to make sure that we're evolving with markets. And two things have happened over the last few years. One, our asset management business has achieved significant scale, and it has benefits of being close to capital, and that has benefited us as we've grown the business.

Close to capital and that has benefited us as we've grown the business from its infancy, but no as of a position where it's one of the largest asset managers in its own right with a strong growth profile.

Speaker 4: from its infancy but now is of a position where it's one of the largest asset managers in its own right with a strong growth profile and secondly the markets have evolved.

Secondly, the markets have evolved.

Speaker 4: and currently have a clear preference for AssetLight. And to Bruce's point, we listen to the market and we often look to respond accordingly. We believe this is spinning out a part.

Currently have a clear preference for asset light.

To Bruce's point, we listened to the market.

We often look to respond accordingly, we believe that spending at a part.

Speaker 4: of the manager would allow investors the one access to just that asset light part of the business, that access without maybe losing the overall synergies that we have in the business.

Of the manager with a lot of investors that want access to just that asset light part of the business that offset with access without maybe losing the overall synergies that we have in the business.

Speaker 5: Okay, I'll let others pick that up. I'm sure you're going to get lots of questions. I did want to ask one about the wealth channel, which the old asset management industry has really just only started to tap. Can you talk about how much of your feed there in capital and current fundraising is coming from that channel, but also how do you factor in the significant retail ownership of the perpetual affiliates when you think about your scale in retail or wealth?

Okay.

I'll, let others pick that up I am sure Youre going to get lots of questions I did want to ask one about the wealth channel, which the.

Asset management industry has really only started to tap.

Can you talk about how much of your fee bearing capital in current.

And coming from that channel, but also how you factor in the significant retail ownership that perpetual affiliates. When you think about your scale in retailer well.

Speaker 4: Yeah, that's a good question, Sherilyn. I think on the private fund...

Yes, that's a good question Sharon I think on the on the private fund.

Speaker 4: fundraising, it was in that 7 to 10% range and it's coming from that private wealth channel of our fee bearing capital. But you're right to observe that, you know, with our listed affiliates, we also have, you know, a really strong retail following and a retail product through that channel. So that does play into it. For the business.

And raising.

It was in that 7% to 10% range and Thats coming from that private wealth channel of our fee bearing capital, but you are right to observe that.

With our listed affiliates, we also have a <unk>.

Really.

A strong retail following in our retail product through that channel.

So that does play into it.

Speaker 4: As you know, we have been building out our retail marketing efforts with the creation of Brookfield Oak Tree Wealth Solutions and with the creation of the distribution capabilities.

For the business as you know.

We have been building out our retail marketing efforts with the creation of <unk>.

Brookfield, Oaktree wealth solutions and with the accretion of the distribution capabilities.

Speaker 4: and we've been selling existing products but also creating new products that are specifically designed and resonate with that channel with the private REIT being the first but I think there's more to follow and I think it's just an extension of what we already do and some of our products and where we have that expertise and we can leverage the platforms that we have and so there should be more products to follow and we think that it will be a good source of capital going forward.

We've been selling existing products, but also.

Creating new products Theyre, specifically designed and resonate with that channel with the private REIT being the first but I think there's more to follow and I think is just an extension of what we already do and some of our products and where we have the expertise and we can leverage the platforms that we have.

And so there should be more products to follow and we think that it will be a good source of capital going forward.

Speaker 1: That's my cue. Thank you. Thank you. Thank you. Our next question will come from Mario Saric with Scotiabank. Please go ahead.

That's my two thank you. Thank you.

Thank you. Our next question will come from Mario <unk> with Scotiabank. Please go ahead.

Speaker 6: All right, thank you. Good morning. Just coming back to the potential.

Alright, Thank you and good morning.

Just coming back to the potential outcome.

Speaker 6: asset manager spin out, I think you've referenced a couple times the potential to spin out or separate a part of the manager. So if we sit back and just think about intrinsic value of the company today, the invested capital, as you pointed out in the value of the asset manager.

I understand alright, Thank you referenced a couple times the potential to spin out or separate a part.

The manager so if we sit back and just think about intrinsic value of the company today.

Adjusted capital as you pointed out and value of the asset manager.

Speaker 6: Is the park in reference to differentiating between kind of public and private sea streams? I'm just hoping you can expand on how you define park in terms of the options that you're considering.

As the park in reference to differentiating between kind of public and private fee streams I was hoping you could expand on how you define part in terms of the options that you're considering.

Speaker 4: Yeah, part Mario more just refers to the actual percentage of the manager that we spend into public hands. Maybe the public would own X percent of the business and Brookfield parent would still own a meaningful part of the business. Meaning if people have a preference to invest in asset light, they can invest directly into the manager or for those that have, that want to invest in the manager and the capital, that option would still exist.

Part Mario more just refers to the actual percentage of the manager that we spend into public hands.

I mean, maybe the public would own X percent of the business and Brookfield parent would still own a meaningful part of the business, meaning if people have a preference to invest in asset light they can invest directly into the manager or for those that have.

We want to invest in the manager and the capital that's still option would still exist.

Speaker 6: Got it. Okay. And then I guess there's...

Got it okay.

And then.

Yes, there is.

Speaker 6: There's a couple different ways you can go about doing it in terms of separating asset manager from the invested capital. What are some of the ways that you're thinking about today? For them to relate it to.

There's a couple of different ways you can go about doing it in terms of separating us.

From the invested capital what are kind of some of the ways that you're thinking about that or.

Speaker 4: It's too early to say. I think those parts we're working through and it's too early to talk through that in detail.

Okay.

It's too early to say I think those.

We're working through and it's too early to talk through that in detail.

Speaker 6: Okay, and then just my second question just pertains to real estate asset dispositions. It seems like there's daily headlines of BAM selling assets as you pointed out in evaluations. You have an expected range of real estate dispositions of BAM share for 2022 and if so, where do you think most of the focus will come from in terms of geography and asset types?

Okay.

And then just my second question is pertained to real estate.

<unk> it seems like.

Good morning.

We've been selling assets as you pointed out a good valuations.

You Havent expected range of real estate dispositions Bam share through 2022, and if so where do you think most of the focus will come from in terms of geography.

Speaker 4: Yeah, Mario, I don't think we have an unexpected range. But we obviously have

Yes, I don't think we have unexpected range.

We all obviously have.

Speaker 4: assets that we've executed the business plan on and we think if the markets are right then they are candidates to sell in line with what we laid out at investor day. We executed a lot in Q4 and we have others coming and I'd say it's broadly spread geographically and by asset class.

Assets that we've executed the business plan on and we think if the markets are right. Then they are candidates to sell in line with what we laid out at Investor Day, we executed a lot in Q4, and we have others coming in I would say, it's broadly spread geographically and by asset class.

Speaker 4: As Bruce said, others are catching up. Retail is probably the one that the ground on the data is excellent and the leasing activity, the spreads are back, performance is great. Maybe sales for retail might not be the immediate focus, but other asset classes where capital is flowing significantly, and we're being very active.

As Bruce said, others are catching up.

Retail is probably the one that the ground on the data is excellent.

On the leasing activity the spreads are back at the performance is great.

Maybe sales for retail.

It might not be the immediate focus, but other asset classes, where capital is pulling significantly.

We're being very active.

Okay. Thank you those are my two.

Speaker 1: Thank you. Our next question will come from Sohrab Mulvahidi with BMO Capital Markets. Please go ahead.

Thank you. Our next question will come from Sohrab <unk> with BMO capital markets. Please go ahead.

Speaker 7: Yeah, thank you. I just wanted to also maybe start off by thinking about

Yes. Thank you I just wanted to also maybe start off by thinking about.

Speaker 7: the scheme you're talking about to make sure that the underappreciated value of the asset manager is

Hi.

You are talking about to make sure that.

The underappreciated value of the asset managers.

Speaker 7: is realized. I mean, Nick, in the past we've talked about maybe buybacks as a way of extracting some of that value.

Realize that.

In the past we've talked about maybe.

Buybacks.

A way of that.

Extracting some of that value.

Speaker 7: And I wonder if you could even talk a little bit about where we are on that. But also what about distributing some of the invested capital to the BAM shareholders?

I Wonder if you could even talk a little bit about where we are on that but also what about distributing some of that.

Capital to the bank shareholders.

Speaker 7: I guess the essence of the question being why would the Holds Co, if you will, then not trade out of this?

Yes.

Yes, the question being.

Why would the holdco.

You will then not trade at a discount.

Speaker 7: if you had this spin out. So I'm just trying to think through a bunch of these things if you can.

If you.

Spinner, so I'm just trying to come up thanks to a bunch of these things if you can please.

Speaker 3: It's Bruce, so maybe I'll take a shot at trying to answer your question. And if, look, our thinking is that our job is run a great business, which we're still trying to do, and to unlock shareholder value when it makes sense.

It's Bruce so maybe ill take a shot at trying to answer your question.

Look our thinking is that our job is run a great business, which we're still trying to do and to unlock shareholder value when it makes sense in the eye and optimize our structure.

Speaker 3: If we can have our cake and eat it too, i.e., we can have our capital up top, investors that want to invest into the parent company.

If we can have our cake and eat it too.

I E. We can have our capital up top investors that want to invest into the parent company will stay there or keep their shares in that company and they'll have us invest their capital plus let alone a part of the manager but.

Speaker 3: stay there, keep their shares in that company and they'll have us invest their capital plus they'll own a part of the manager.

Speaker 3: If we list part of manager separately, it would enable those investors who choose to or want to own an asset manager the ability to do so.

If we lift part of manager separately, it would enable those investors who choose to or want to own an asset light asset manager the ability to do that.

Speaker 3: if either of those securities in the future don't trade properly.

If either of those securities in the future don't trade properly.

Speaker 3: We can always buy shares back into the Treasury and continue to increase value by.

We can always buy shares back into the treasury.

<unk>.

And continue to increase value by if they're trading less than fair value. So the bottom line is all of those options are open all we're trying to do is maximize the value of the business.

Speaker 3: trading less than fair value. So, you know, the bottom line is all of those options are open. All we're trying to do is maximize the value of the business in the longer term. And so all the things you say are possible.

In the longer term and so all the things you say are possible.

Okay. That's it for me thank you.

Speaker 1: Thank you. Our next question will come from Robert Lee with Keith Brouillette and Woods. Please go ahead. Great, good morning. Thanks for taking my questions.

Thank you. Our next question will come from Robert Lee with Keefe Bruyette <unk> Woods. Please go ahead.

Great. Good morning, Thanks for taking my questions maybe just.

Speaker 8: Sticking with the theme of the day on the potential spin, so it kind of sounds like this is something on a high level, don't want to put words in your mouth, but maybe you've decided. So really, is at this point just kind of going through the mechanics of how that would look, any tax impacts?

Sticking with the theme of the day.

On the potential spin so.

It sounds like this is.

Something.

On a high level.

I won't put words in your mouth, but maybe you've decided so really at this point just kind of going through the mechanics of how that would look any tax impacts so.

Speaker 8: Again, kind of like we think this will be a good thing, but we now just got to work through the mechanics of it. Is that every kind of pretty much where where you're at right now?

Again kind of like we think this will be a good thing, but we are now we just got to work through the mechanics of it is that kind of pretty much where we're at right now.

Speaker 3: You know, look, I would, the bottom line is we think it's

Look I would.

Bottom line is we think.

Speaker 3: very executable plan. It's now in the public. All of our owners can express their views to us and we're going to come up with the right plan based off of all that plus the information we have. So we're heading down a path and we're quite serious about it or we wouldn't have put it in the letter the way we did.

It's a very executable.

Plan.

It's now in the public all of our owners can express their views to us and.

And we're going to come up with the right plan based off of all of that plus the information we have.

So were heading down a path and we're quite serious about it or we wouldn't have put it in the letter the way we did.

Okay, Great and then maybe just.

Speaker 8: shifting gears a little bit the fundraising in mean clearly you got going gangbusters you've seen it and actually across many of your peers so just curious your number one briefing any signs of blackboard bedouette putting it in a fifty-two mongol peas mean clearly you know there's secular demand here given the rate of our men and what not but you know you start to see at least on the interim basis i get that getting this impression that lp's of flooded with no fund offerings

Shifting gears, a little bit the fund raising I mean, clearly you guys are going gangbusters you've seen it.

Across many of your peers. So I'm just curious number one are you seeing any signs of a lack of a better way of putting it fatigue. Among Lps I mean, clearly there is secular demand here given the rate environment and whatnot, but you.

Are you starting to see at least on an interim basis.

Getting this impression that Lps are flooded with fund offerings and that maybe there is then like slow this down pushback or are you seeing any signs of that that may change how your impact how youre thinking about the timing of fund closes at all.

Speaker 8: and that maybe there's been like, slow this down, push back. Are you seeing any signs of that than me?

Speaker 8: change how you're impact, how you're thinking about the timing of fund closes at all.

Speaker 3: I'll give you a short answer, no. Look, the longer answer is we're in a very low integrate environment as noted in the letter 8.

I'll give you a short answer no.

The longer answer is we're in a very low interest rate environment as noted in the letter.

Speaker 3: eight interest rate hikes gets your short rate to 2%. So we're in a very low environment, especially when the products that we invest for

<unk>.

<unk> interest rate hikes gets your short rate to 2%.

So we're in a very low environment, especially when the products that we.

Invest for our clients earn six on the low end and <unk> 25 on the high end.

Speaker 3: 6 on the low end and 25 on the high end. These are very attractive products and there doesn't seem to be any reason to have that slow down.

These are very attractive products and there doesn't seem to be any reason to have that slowdown.

<unk>.

Great. Thank you for taking my questions.

Speaker 1: Thank you. Our next question will come from Jeff Kwan with RBC Capital Markets. Please go ahead.

Okay.

Thank you. Our next question will come from Geoff Kwan with RBC capital markets. Please go ahead.

Speaker 9: Hi, good morning. Just going back to the asset manager potential spin.

Hi, good morning.

Just going back to the asset manager potential spin.

I'm just wondering is.

Speaker 9: Obviously, you've talked about it's still a little bit preliminary, but would any sort of spin-off have at least theoretically the potential?

Obviously, you've talked about it's still a little bit preliminary but would any sort of spinoff have at least theoretically the potential.

Speaker 9: to change the relationship with BIP, BEP, BPG, BBU in terms of management services agreement, whether or not it's financial terms or other, as opposed to keeping the status quo? Or is that probably one of the considerations as you think about what ways to go about doing it if you decide to go with us then?

Do you change the relationship with PPG.

<unk> in terms of management services agreement, whether or not the financial terms of rather as opposed to keeping the status quo.

Or is that probably one of the.

Considerations as you think about what.

We used to go about doing it if you decided to go with the spin.

Jeff is the short answer is we would expect no change.

Okay.

Speaker 9: And then my second question was just on the Global Transition Fund. I mean, it sounds like obviously the opportunity is large and numerous. I'm just trying to, I guess, understand a little bit in how you're going about figuring out where to focus on where the best opportunities are, whether or not it's the renewable assets themselves.

And then my second question is just on the on the global transition fund I mean, it sounds like obviously the opportunity is large.

Numerous I'm just trying to I guess understand a little bit.

How youre going about figuring out where to focus on where.

Where the best opportunities are whether or not it's the renewable assets themselves.

Speaker 9: making investments with operating companies that need help with the transition? Are there certain geographies that are more attractive that...

Making investments with operating companies that need help with the transition are there certain geographies that are more attractive that sort of thing.

Speaker 2: Sure, Jess. I'll take that. It's Natalie here. First of all, the immediate first place we're starting is renewable energy. When you look at the range of decarbonization solutions that are available for corporates today.

Sure, Jeff I'll take that it's not only here.

First of all the immediate first place we're starting into renewable energy. When you look at the range of Decarbonization solutions that are available for corporates today.

Speaker 2: thinking about cleaning up their scope two emissions, so cleaning up how they purchase their electricity or reducing their electricity consumption by the way of investing in things like distributed generation. That is the best way for corporates today to make an immediate impact on their carbon footprint and to help buy them time as the cost of other decarbonization technologies comes down.

Thinking about cleaning up their scope two emissions, so cleaning up how they purchase their electricity or reducing their electricity consumption by the way of investing in things like distributed generation that is the best way for corporates today to make an immediate impact on their carbon footprint and to held by them.

As the cost of other de Carbonization technologies comes down.

Speaker 2: That's the absolute first place we'll start. But I would say, what's exciting and particularly why we mentioned that we're going to be spending time with...

That's the absolute first place will start, but I would say, what's exciting and particularly why we mentioned that we're going to be spending time with.

Speaker 2: the hard to abate sectors like steel, cement and chemicals is because the timeline for those companies to implement their solutions will take 5 to 10 years to invest in the infrastructure to actually enable them to decarbonize by 2030. And so those capital projects are starting now and those conversations are starting now and we're having active dialogue with all of them. And we will focus on those that have the most

The hard to abate sectors like steel cement and chemicals is because the timeline for those companies to implement their solutions will take five to 10 years to invest in the infrastructure to actually enable them to decarbonize by 2030, and so those capital projects are starting now and those <unk>.

Our stations are starting now and we're having active dialogue with all of them and we will focus on those that have the most.

Speaker 2: the highest energy intensity and the largest capital need is where we're seeing the most opportunities to add value.

The highest energy intensity and the largest capital need Thats, where were seeing the most opportunities to add value.

Okay, great. Thank you.

Speaker 1: Thank you. Our next question will come from Alexander Bloestein with Goldman Sachs. Please go ahead.

Thank you. Our next question will come from Alexandra <unk> with Goldman Sachs. Please go ahead.

Speaker 8: Thanks, everybody. Good morning for taking the question. So back to the structure. So from what it sounds like you're really considering the spin off to be not really separation, but more of the cracker stock, they'll just give investors an opportunity to play the kind of pure asset management side of the business. So a just want to understand that that's correct. And the

Thanks, everybody good morning for taking good morning, Thanks for taking the question.

So back to the structure so from what it sounds like you are really considering the spin off to be not really separation, but more of the tracker stock they'll just give investors an opportunity to play the kind of pure asset management side of the business. So just want to understand if that's correct can be.

Speaker 8: I guess what is your timing in ultimately in terms of the structure? How could ultimately investors think about the cash flows that will be coming into that vehicle? Meaning that are you guys going to distribute it? Are you going to retain it?

I guess what is your timing in ultimately in terms of the structure Hartford ultimately investors think about the cash flows that will be coming into that vehicle to meeting that.

You guys going to distribute it are you going to retain it in currently you guys have a pretty material tax shield.

Speaker 8: And currently, you guys have a pretty material tack shield.

Speaker 8: given that everything's combined and that the BAM umbrella, are you gonna be able to retain the tax shield or the kind of earning from the new CO, the asset manager will be taxed at a typical rate.

Given that everything is combined at the Bam umbrella are you going to be able to retain the tax shield or the kind of earnings from the newco the asset manager will be taxed at a typical rate.

Speaker 3: Bruce, I think you asked four questions. I'll try to be quick, although I'm not going to get into too much detail on this call until we have more fulsome answers for you. I'll try to answer three. First, you said is the security going to be a security or a tracking stock? It will be a full security and a listed company.

It's Bruce I think you asked four questions. So I'll try to be quick, although I'm not going to I'm not going to get into too much detail.

On this call.

Until we have more fulsome answers for you.

I'll try to answer three.

First you said is the security going to be a security or a tracking stock it will be a full security in a listed company.

Speaker 3: the BAM parent may own a part of it and we're going to separate and distribute to our shareholders a part of the business.

The band parent may own a part of it and we're going to separate.

And distribute to our shareholders a part of the business.

Speaker 3: a quarter, a third, whatever that number is to start off with. But it will be a separately listed security.

A quarter or third whatever that number is to start off with.

But it will be a separate separately listed security.

Speaker 3: As to payout, we'll have to consider that based on all the other securities are out there and what's best for the shareholders. But there will not be a lot of need for cash in the company, so it could have a full payout of its cash flows if we so choose.

As to payout will have to consider that based on all the other securities are out there and what's best for the shareholders.

But there will not be a lot of need for cash in the company. So it could have a full payout of its cash flows if we so choose.

As to the shields, we have within the business will allocate them to the right spot.

Speaker 3: shields we have within the business, we'll allocate them to the right spot at the time when we list the security and everyone will know about that.

At the time, when we list when we listed the security and everyone will know about that at the time.

Speaker 8: Great. Thanks so much. And then, I guess my second question or maybe second topic, when I circle back on the wealth business, it sounds like you guys are on four platforms now, up from one, earlier or late last year. I'm curious to get your take on what the reception has been from financial advisors.

Great. Thanks, so much and then.

Yes, My second question or the second topic, what I circle back on the wealth business. It sounds like you guys are on four platforms now up from one.

Earlier.

Last year.

Yeah, your sort of take on what the reception has been from financial Advisors then.

Speaker 8: kind of key gatekeepers to the product. Any update you have for us in terms of monthly flows would be helpful. And ultimately, what would you consider a sort of success from this channel over the course of the year.

Kind of key gatekeepers to the product.

Any update you have for us in terms of monthly flows would be helpful and ultimately what would you consider sort of success from this channel over the course of the year.

Speaker 3: Look, we're early days. We put together both Brookfield, Oaktree, Wealth.

Look we're early days, we put together both Brookfield Oaktree well.

Speaker 3: nine months ago and it's had a very meaningful impact with our relationships with the wealth channel.

Six nine months ago.

It's.

Had a very meaningful impact with our relationships with the wealth channels I think it could be it will be very meaningful going forward, but.

Speaker 3: It could be-it will be very meaningful going forward, but we're just starting into it. So I don't really have a prediction for you.

But we're just starting into it so I don't really have a prediction for you as to the numbers that will be.

Speaker 3: numbers that will be coming in on a monthly basis. But the early indications are that our products, like they are to institutional clients, will be highly attractive to wealth. And

Coming in on a monthly basis, but.

But the early indications are that our.

Products like they are to institutional clients will be highly attractive to wealth and.

Speaker 3: pick the right ones to put into those channels.

We need to pick the right ones to put into that those.

<unk> and <unk>.

Uh huh.

We're going to do that.

Great. Thanks, so much.

Speaker 1: Thank you. Our next question will come from Andrew Cuskey with Credit Suisse. Please go ahead.

Welcome. Thank you. Our next question will come from Andrew <unk> with Credit Suisse. Please go ahead.

Speaker 6: Thanks. Good morning. I guess one of the key principles from Brookfield on a longer term basis has been compounding historically and we see highlights of this in the morning as the miracle of finance.

Thanks, Good morning, I guess, one of the key principles on a longer term basis, it's been compounding historically I mean, you highlighted listen a lot.

Speaker 6: Could you maybe just step back a little bit and address your businesses? Are you seeing multiplier effects across them?

Miracle of finance.

Could you maybe just step back a little bit and address your businesses are you seeing multiplier effects.

Across some of the businesses.

Speaker 6: as they interact together. And maybe one example would be just what we can do on the residential front, the residential infrastructure being HVAC, multifamily distributed generation, GC multiplier effects across those businesses as they're now sort of merging together to a certain degree from an opportunity standpoint.

They interact together and maybe one example would be just what it can do on the residential fronts.

Residential infrastructure HVAC multifamily distributor generation do you see multiplier effects across those businesses.

Nelson merging together to a certain degree from an opportunity standpoint.

Speaker 3: Yeah, look, I think that part of the success of our business is that we we've tried to keep in

Yes look.

I think the part of the success of our business is that we.

We've tried to ensure that we coordinate all of the affairs within the business and therefore, many of our groups work together and when we find new ideas, we try to flow them across different areas. So.

Speaker 3: and therefore many of our groups work together. And when we find new ideas, we try to flow them across different areas. So I think it just helps.

I think it just it helps when you have a big broad platform to be able to do that and maybe even as important is when we learn something in one country.

Speaker 3: you have a big broad platform to be able to do that and maybe even as important is when we learn something in one country.

Speaker 3: it may not have been applied the same way in 29 other countries that we're in. And therefore, we can take our businesses and globalize them. So, many of the things that we're doing today and are taking ideas that we have in one country that we found that are really successful and applying them in other areas, doing the same thing but doing it in another country where it hasn't been done before and both from an operating and a financial perspective that has been extremely...

It may not have been applied the same way in 2009 other countries that we're in and therefore, we can take our businesses and.

Globalize them. So many of the things we're doing today.

Our taking ideas that we have in one country that we found that are really successful and applying them in other areas doing the same thing, but doing it in another country, where it hasnt been done before in both from an operating and a financial perspective that.

It has been extremely.

Positive for the for the business.

Speaker 6: That's helpful. And that may be related to that slightly different as you look at the market conditions now globally, where there's a bit more volatility, some inflation concerns in parts of the world on even economic recovery, your positions in multiple markets, you know, do you see the transactional environment and potential now in the outlook in the next 12 months as being more favorable from a deployment standpoint than what you saw in the last 18.

That's helpful and then maybe related to that slightly different.

You look at the market conditions now globally.

Where there's a bit more volatilities from inflation concerns in parts of the world on uneven economic recovery you are positioned in multiple markets.

You see the transactional environment and potential now and the outlook in the next 12 months as being more favorable from a deployment standpoint than what you saw in the last 18 months.

Yeah.

Speaker 3: Look, there's never a perfect environment because when...

Look there is never a perfect environment because when.

Speaker 3: When there's no money available, there's usually lots of opportunity. When there's lots of money available, there's less opportunity.

When there is no money available theres, usually lots of opportunity and when theres lots of money available as there is less opportunity.

Speaker 3: But I would just say that given our broad platform in many countries and we're in multiple sectors.

But I would just say that.

Given our broad platform in many countries and we're in multiple sectors.

Speaker 3: There's never, every one of them doesn't offer opportunities, but there's always something.

Theres never.

Every one of them it doesn't offer opportunities, but there's always something to do and I would say today, we see lots of opportunity out there.

Speaker 3: And I'd say today we see lots of opportunity out there.

Speaker 3: I'd say it's no less than it was before and a lot of them are things that you would not even

And I would say, it's no less than it was before.

Lot of them are things that you would not even.

Speaker 3: I think there should be opportunity available, but people require our capital, require our operating skills, require a partnership with somebody like us, and therefore we find opportunity. So there's an excellent market today for opportunities for all of our businesses.

I think there should be opportunity available but people.

Require or our capital.

It'll require our operating skills require a partnership with somebody like us and therefore, we find opportunities so.

There is an excellent market today for opportunities for all of our most of our most or all of our businesses.

Okay. That's great. Thank you very much very much.

Speaker 1: Thank you. Our next question will come from Bill Katz with City Group. Please go ahead.

Thank you. Our next question will come from Bill Katz with Citigroup. Please go ahead.

Speaker 8: Okay, thank you very much for taking the questions. So just coming back to Spin yet again, I apologize. So I guess maybe the conceptual question for me, why not spin the whole asset management business or spin the invested capital platform? How do you think about milestones here just to keep the market abreast of your thinking? Thank you.

Thank you very much for taking the questions. So just coming back to spin yet again, so I apologize.

So I guess, maybe a conceptual question for me.

Why not spin the whole asset management business or spin the.

Invested capital platform and how you think about milestones here just to keep the market abreast of Youre thinking thank you.

Okay.

Speaker 3: So look, here's what I would say. If we create the most value by entirely separating the business, we would do it.

So look here's what I would say.

If we create the most value by entirely separating the business we would do it.

Speaker 3: Our view today is that having the capital company have an interest in the manager to be able to align itself and put its capital and have its capital managed in a fashion that it's happy about is the right way to go. But over time, if that made sense, we could do it in four steps or we could do it in one all up front. But our view today is that...

Our view today is that having the capital company have an interest in the manager to be able to align itself and put its capital and have as capital manage.

Fashion.

Happy about is the right way to go.

But over time, if that made sense, we could do it in four steps or we could do it in one all upfront.

But our view today is that.

Speaker 3: creating the asset light manager listing part of it is the way to go, but if owners of ours have views, we'd be pleased to talk.

<unk> is creating the asset light manager listing part of it.

Is the way to go but.

<unk>.

If owners of ours have.

We'd be pleased to talk about it.

Speaker 8: Okay, and just to follow up, you had mentioned that your current form is holding you back in certain growth opportunities. I was wondering if you could expand a little bit about what the holdbacks are and what growth opportunities you see and then which comps were you using to value the asset management business?

Okay, and just just a follow up you had mentioned that your current form is holding it back in certain growth opportunities I was wondering if you could expand a little bit about.

What the hold backs are and what growth opportunities you see in which comps for you are using to value the asset management business.

Speaker 3: I'm going to let Nick deal with the second one. But what I would say is, just to be crystal clear,

I'm going to let Nick deal with the second one.

But what I would say is just to be crystal clear we.

Speaker 3: We've compounded at 20% for 20 years. So there aren't any holdbacks here. What our job is to do, our job is to look at the business.

We've compounded at 20% for 20 years, so there arent any hold backs here what our job is to do our job is to look at the business.

Speaker 3: run a great business, unlock shareholder value as we can. That's what we're in business to do.

<unk>, a great business unlock shareholder value as we can that's what we're in business to do and.

Speaker 3: Our view, therefore, is just we should keep at that effort. And if we have securities that trade properly in the marketplace at their fair value.

Our our view therefore is just we should keep at at that at.

At that effort.

And.

If.

If we have securities that trade properly in the marketplace at their fair value. It opens up options to use those securities for something you want to do in the future if the opportunity presents itself.

Speaker 3: it opens up to options to use those securities for something you want to do in the future if the opportunity presents itself.

Speaker 4: Bill, it's Nick on the second question. It's consistent with what we used at our investor day. So 25 to 40 on FRE and 10 on our target carry.

And Bill it's Nick on the second question, it's consistent with what we used at our Investor day, So 25% to 40 on FRE and turn on.

Our target carry.

Thank you very much.

Speaker 8: Thank you. We do have a follow up question from Robert Lee with Keith, Gugliel, and Woods. Please go ahead. Great. Thanks for taking my follow up. Maybe sticking with fundraising and not to spend.

Thank you we do have a follow up question from Robert Lee with Keefe Bruyette <unk> Woods. Please go ahead.

Great. Thanks for taking my follow ups, maybe sticking with the fund raising.

And not to spend.

Speaker 8: unit really maybe a two-parter so mean that if i look at the number of strategy that by the flagship strategy that you have in market i think you pointed out something like thirty five in units really kind of expanded tremendously the last bunch of years uh... so

So.

Really maybe a two parter so I mean, if I look at the number of strategies outside of the flagship strategies that you have in market. I think you pointed out something like 35, I mean, it's really kind of expanded tremendously less bunch.

A bunch of years.

Speaker 8: I'm just curious, I mean, could you maybe give us a sense of...

So.

I'm just curious I mean could you maybe give us a sense of.

Speaker 8: of how you actually have maybe changed your organization or how you go to market to actually try to maximize that because have so many things in so many places, you know, how do you make sure you're kind of not missing opportunities or maximizing your potential there and then

Of of how you actually have maybe changed your organization or how you go to market to actually try to maximize that because so many things in so many places.

No.

How do you make sure you kind of I'm missing opportunities or maximizing your potential there and then.

Speaker 8: Maybe the second part of the fundraising is, as you point out, there's so much demand. Historically, you've taken very large chunks of your own funds. How is your own appetite for whether your participation will be 5% or 15%, changing to create more capacity for third-party clients?

Maybe the second the second part of the fund raising is there's as you point out there's so much demand historically, you've taken very large chunks of your own funds.

How is your your own appetite for whether you're participating.

Patient would be 5% or 15% changing too to create more capacity for third party.

Clients.

Speaker 4: Hey Rob, yes, so on the first part, you know, I think the number of complementary strategies has really evolved as the scale and size of each of our businesses has evolved. So how we have evolved is, you know, we have four businesses plus we have five businesses.

Yes, so on the on the first part.

I think the the number of complementary strategies has really evolved as the scale and size of each of our businesses has evolved.

We have four businesses plus we have all three supply businesses and each of those businesses have client relationships and as clients have allocated more and more capital to alternatives and have looked for solutions, I'd say up and down the capital stack with different risk profiles, we have the the <unk>.

Speaker 4: And each of those businesses have client relationships. And as clients have allocated more and more capital to alternatives and have looked for solutions, I'd say up and down the capital stack with different risk profiles.

Speaker 4: we have the investing and the operating expertise and the experience to offer in those products across the channels. So it's really a leveraging the platforms that we have and catering to our clients needs and providing them with these products. And we start, as Natalie said, like we're doing in transition, we started with the flagship funds, but that knowledge and expertise translates well to scaling up a core offering in the same sectors with different risk or profile.

<unk> and the operating expertise and the experience to offer them those products across the channels. So it's really leveraging the platforms that we have in catering to our clients' needs and providing them with these products and we start as Napoli said like we're doing in transition we started with the flagship funds, but that knowledge and expertise.

<unk> well to scaling up the core offering in the same sectors with different risk score profile.

Speaker 4: and adding a couple of investment professionals to lead each strategy, but really leveraging the underlying platform to inform our decision-making, our diligence, and then operating when we own the asset. So I'd say that's how we have evolved and we stay on top of it by having close relationships with our clients and responding to their needs.

And adding a couple of investment professionals to lead each strategy, but really leveraging the underlying platform to inform our decision, making our diligence and then operating when we own the asset. So I'd say, that's how we have evolved and we stay on top of it by having close relationships with our clients and responding to their needs.

Speaker 4: and that has led to this growth in products. And as we later investigate, real estate is probably the most evolved and our other businesses are evolving quickly with new products all the time and catering to new channels as we go.

That has led to this growth in products and as we laid out Investor day real estate is probably the most evolved on our other businesses are evolving quickly with new products, all the time and catering to new channels as we go.

Speaker 4: On our own appetite, I would say that as the size of the funds is growing, it's a decision we make each time, but the absolute dollars are still significant. So percentages may change, but the dollars are meaningful, which shows our conviction in the funds and still creates that strong alignment of interest. So it evolves over time, but the capital is still meaningful.

On our own appetite I would say that.

As the size of the funds is growing it's a decision we make each time, but the absolute dollars are still significant so percentages may change, but the dollars are meaningful.

Which shows our conviction in the funds and still create strong alignment of interest and so it evolves over time, but the capital still meaningful.

Hey, Thanks for taking my questions.

Speaker 1: Thank you. We do have a follow-up from Saurabh Movahedi with BMO Capital Markets. Please go ahead.

Thank you and we do have a follow up from Sohrab <unk> with BMO capital markets. Please go ahead.

Speaker 7: Thank you. Just a more detailed or maybe a final one. I think you mentioned

Thank you.

More details or maybe a final one I think you mentioned.

Speaker 7: about 10 billion dollars of real estate.

About $10 billion.

Real estate.

Speaker 7: dispositions. Any indications as to what the plan is for that cat?

Dispositions any any indications as to what the plan is for that cash.

Speaker 4: Yes, so the 10 billion would have been the gross number of sales. I think we mentioned about a couple of billion dollars of gains. So that gains is obviously accruing to the real estate business, some being reinvested and some being repatriated to Brookfield. So it's in line with the plan that we would have laid out. We'll look for opportunities over the most optimal places to deploy that capital within the organization.

Yes, so sort of the $10 billion would have been the gross number of sales I think we mentioned about a couple of billion dollars.

Of gains so that games is obviously accruing to the real estate business, some being reinvested and some have been.

Created to Brookfield. So it's in line with the plan that we would have laid out will look for opportunities where the utmost optimal places to deploy that capital within the organization.

Speaker 7: So Nick, just to be crystal clear, it may involve making new investments in the real estate field.

So Nick just to be Crystal clear it may involve.

New investments in the real estate.

Speaker 4: It could do, it could do, or it could be repatriated.

It could do.

It could do or it could yes.

Yes, or it could be repatriated.

Thank you.

Yes.

Speaker 1: Ladies and gentlemen, thank you for participating in today's question and answer session. I would now like to turn the call back over to Ms. Suzanne Fleming for any closing remarks. Thank you, operator.

Ladies and gentlemen, thank you for participating in today's question and answer session I would now like to turn the call back over to MS. Suzanne Fleming for any closing remarks.

Thank you operator, and with that we will end today's call. Thank you for joining us.

Speaker 1: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.