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St. Catharines, Ontario

The new office building located at our Henley Corporate Park development site has recently been completed and is known as 25 Corporate Park Drive. This 45,000 square foot, three storey building is now 62% pre-leased to three Class 'A' tenants. The first lease commencement date is March 2008. We also have three acres of vacant land located at the Henley Corporate Park site which remains available for development. Although the occupancy rate for 20 Corporate Park Drive is the same as last year at 94%, base rent actually declined in the year due to fluctuations in the occupancy level throughout the year. Total revenue is up by 1% over the previous year due to recoverable cost increases due from the tenants. The competition in the downtown office market remains very competitive, and although revenue has remained the same for 63 Church Street in comparison to the year 2006, occupancy decreased from 88% at the end of 2006 to 75% by the end of 2007. This building also houses the Corporation's executive offices.

The Ridley Square and Huntington Square plazas had a revenue increase of 3% in 2007 over 2006 reflecting increases in recoverable costs from the tenants in addition to slight rental rate increases. Occupancy remained at 100% for Ridley Square for the year while Huntington Square decreased to 94% from 95% at the end of 2006. The occupancy rate for Martindale Business Centre increased to 96% in 2007 compared to 92% in 2006 which resulted in a 9% increase in revenue in 2007 when compared to the previous year.

Our joint venture office building, 75 Corporate Park Drive, has maintained 100% occupancy throughout the year with revenue remaining flat in 2007 when compared to the year 2006. A tenant will be vacating their premise, representative of 11% of the gross leasable area of the building, in March 2008 and will be relocating to the 25 Corporate Park Drive building. Our joint venture partner, also a tenant in the building, is interested in leasing the subject premises for its own use. As a result of over-crowding and in order to meet our tenants' needs, the parking facilities were expanded in 2007 on adjacent lands owned by ACP.

Although the downturn in the industrial sector in St. Catharines has provided for certain negative impacts, the service sector's interest in quality commercial space remains positive. We are optimistic that lease-up of our properties will continue to improve.

 63 Church Street

 Ridley Square

 Huntington Square

 Martindale Business Centre

 75 Corporate Park Drive

 20 Corporate Park Drive