Thank you for standing by. This is the Chorus Call conference operator. Welcome to the Brookfield Residential Properties Inc. conference call and webcast to present the company's 2013 fourth quarter results to shareholders. As a reminder all participants are in listen-only mode when the conference is being recorded. After the presentation there will be an opportunity to ask questions. (Operator Instructions). At this time, I’d like to turn the conference over to Mr. Alan Norris, President and Chief Executive Officer. Please go ahead, Mr. Norris.

Thank you very much. Good morning, ladies and gentlemen, and thank you for joining us for Brookfield Residential's 2013 yearend conference call. With me today is Craig Laurie, our Chief Financial Officer. I would, at this time, remind you that in responding to questions and in talking about new initiatives and our financial and operating performance, we will make forward-looking statements. These statements are subject to known and unknown risks and future results may differ materially. For further information, I would encourage investors to review the corporate profile on our website. 2013 was a rewarding year as we continued to harvest what has been for many years solid and reliable income and cash flow from our Canadian operations, while the U.S operations capitalized on significantly improved housing market conditions. Our income before income tax increased 33% to $172 million and the net income attributable to Brookfield Residential increased 33% to $1.21 per diluted share. We achieved these results while continuing to build on our well located land asset portfolio. In 2013 we completed $358 million in strategic land acquisitions, split almost equally within Canada and the U.S. And at yearend we controlled over 110,000 lots which positions Brookfield Residential as one of the leading asset-rich land and housing companies in North America. As we anticipated, the U.S housing market continued to rebound in 2013. While there was a small bump along the road midway through the year related to the tapering discussions and U.S government shutdown, the U.S market finished the year with new house prices up year-over-year. While the pace of recovery and supply has varied from region to region, demand has improved over past years, which has led to rising home prices. Our Canadian operations in Ontario and Alberta remained solid in 2013. In Ontario, our operations continued…

Thank you, Alan, and good morning, everyone. As Alan outlined, Brookfield Residential had strong results in 2013. At yearend, net income attributable to Brookfield Residential was $79 million or $0.67 per diluted share for the 3 months ended December 31, and $142 million or $1.21 per diluted share for the 12 months ended December 31. This was an increase of $23 million and $49 million, respectively, when compared to the same period in 2012 and was the result of the increased gross margin from higher home closings, combined with a decrease in income tax expense, which was partially offset by higher sales and marketing costs and general administrative expenses. Land revenue for the 3 months ended December 31, 2013 totaled $146 million compared to $407 million during the same period in 2012. The 2012 land operations include the Playa Vista sale of 195 lots and 22 multi-family acre parcel sales that resulted in $264 million of revenue and $nil margin. With the inclusion of the Playa Vista sales, land revenue -- without the inclusion of the Playa Vista sale, land revenue increased by $3 million over the same period in 2012. Land gross margin was $63 million, a $2 million increased compared to the same period in 2012. For the 12 months ended December 31, 2013, land revenue totaled $373 million compared to $622 million in 2012. Adjusting for the sale of Playa Vista, land revenue increased by $15 million. Compared to 2012, gross margin was stable. Housing revenue was $409 million for the 3 months ended December 31 compared to $308 million for the same period in 2012. Housing gross margin for the same period of 2013 was $85 million, a $35 million increase compared to the prior year. The increase in housing revenue gross margin was due to…

(Operator instructions). The first question is from Dan Oppenheim of Credit Suisse. Please go ahead.

I was wondering if you can just talk, as you think about 2014, you’re talking about some of the projects in terms of land sales and section approvals and much coming at the end of the year. If you can provide a bit more clarity then also a bit in terms of the mix as you think about that I guess especially within California in terms of the mix of land sales.

Hi Dan, it’s Alan. Yeah, I think -- we have a couple of projects just that come to mind that we’re finishing off the entitlements and we’re probably a month away and we’re literally letting construction contracts go in the beginning of Q2, which we would then be hopefully finishing off all of the onsite work required to sell lots by October, November, early December. So we have a number of lot sales that fit into that category. So we have a few moving parts to get to that. That’s really the point we’re trying to make and those are specifically in California. So with respect to the mix from a housing perspective, we still have a fairly high average sales price going forward in California, with a lot of the projects up (inaudible) in northern California. And then we will now start to see some even coming from the Playa Vista project for instance in 2014 which is obviously a high ASP as well. Craig, did you have --

That’s very helpful for housing. I apologize. Sorry. That was on the housing side that last part. The first part was on the lot sales.

The next question is from Adam Rudiger from Wells Fargo Securities. Please go ahead.

I wanted to talk a little bit about land gross margins if we could. Obviously they’re a bit volatile and we understand the one-time nature of certain transactions can impact that. But I think many people, myself included, try to use that metric as a way of valuing the rest of the inventory. So could you talk about what drove the change? Last quarter it was 58%, this quarter 43%. So what happened this quarter? And then what would be an appropriate range for us to try to think about going forward and if you try to smooth line is all.

This is Craig. So I think, as we talked Canada has been relatively stable usually between say 50% to 60%. That level will vary depending on the mix really between Edmonton and Calgary. We talked about Edmonton had a slightly lower gross margin percent. In California, the land gross margin had about 36% gross margin. We’d normally anticipate that it would be between 25% and 35% in California. In Central and Eastern, the average 9% for the quarter, 7% for year. As we talked about, the big driver of that is just we had not been selling enough lots to really cover the inherent operating costs. In 2014 I think we would look to, with the unit (inaudible) that we should be past that and again we would target the 25% to 35% gross margins on lot sales in central and eastern.

Okay. And then the second question I had, if you look back at what happened in 2013 and the way the year started and then the way that changed throughout the year, did that do anything to impact the multi-year disposition of lots in the U.S., meaning did it accelerate your thoughts at all? Or did you -- just any change I guess is the question.

No, it’s a good point, Adam. It’s Alan here. We obviously saw things slowing down somewhat in Q4. I think everybody did. The trajectory that was going on in the first seven, eight months of the year was quite rapid in most regions. But what we closed in Q4 from a lot sales point of view on housing closings was exactly as we had anticipated. We’ve continued with them. We’re still bullish on where the world is going and where we are in the stage of the recovery specifically from a U.S. point of view. So we’re continuing to move ahead on a consistent basis as to what we originally thought was as a progression in 2014 and getting in 2015 as I touched on in my prepared remarks, getting the U.S. operations up to a level of profitability equal to where Canada is at this point by 2015. And we think we’ll get there through a natural almost linear progression quite honestly. And so we’re still comfortable on the stage of where we are in the recovery. We definitely still need to see better jobs numbers and all that stuff. We’re still not quite sure like anybody is on the December and January numbers that came out, whether that -- everybody keeps talking weather and other things. But we’d like to see a little bit more improvement on that side. But I still think we’ve got a fair ways to go on the affordability side in many of the markets and still also from an absorption point of view and getting up to a more normalized rate of sales for the country nationally.

The next question is from Sam McGovern from Credit Suisse. Please go ahead.

Just to build on the previous question. Other than the slowdown that hit the entire industry in the fourth quarter, have you guys seen any change in the appetite or demand for land from the builders on a go forward basis?

Sam, it’s Alan. Actually it’s a good question because we’re down in Los Angeles, just finished some meetings with our people down here. I think I would say that there was some trepidation probably in Q4, but I think has rebounded and California specifically had a very good January. I think not just us, but many other builders as well. So we’ve been having discussions with many builders of lot sales for later in this year as I touched on earlier on. I think there is still a good sense of optimism and many interested parties coming to the table expressing a desire to buy lots. So I think it’s. We’ll obviously see the spring selling season, but at this point in time we’re not seeing anybody holding back.

And then just to delve into a specific market, you guys talked a little bit in your press release about the Ontario market and relative strength there versus probably expectations. Can you talk a little bit about what you’re seeing there? I think obviously there’s prognosticators are talking about a potential slowdown there. Have you seen any indications of that happening or is it still steady there?

We’ve probably seen some more incentives been offered on the high rise market which we’re obviously not a party to other than on the periphery. We’re only in the low rise business. And we consistent with past calls I think I would say that our pricing was reasonably flat during 2013. But we’re opening up some new communities as we speak and we’re getting excellent number of parties. We’ve got a new community opening up in Ontario. We have 3,000 people have registered to express desire of looking at some of the homes we’re going to be opening up. There’s still a pent up demand. I still think there’s a shortage of infrastructure deficit in that marketplace. No question the high rise business still has some question marks around it, but we’re not seeing much of an offshoot from that in the low rise business. So we’re still comfortable. We occupied over 500 homes there last year and we’re anticipating somewhere in that region again for 2014 and we’re sitting roughly with a 70% backlog, if not slightly higher at this point in time for 2014.

The next question is from Will Randow of Citigroup. Please go ahead.

It’s actually Scott Schrier on for Will. I wanted to ask you, your 2014 guidance assumes that you plan to close homes and lots. That represents a smaller percentage of your total controlled lots as compared to your average back in the early 2000s. And now as we’re ramping up toward mid cycle, just wanted to see, what’s holding you back from getting the closings and lot sales up to that kind of percentage that you had back then?

It’s not a conscious decision on our part. I think it’s really just the state of each of the parcels where we’ve re-entitled some and some of that will happen in 2014 or -- either late 2014 or going into 2015. We continued to see a ramp up over a period of time. Many of the municipalities still don’t have as many individuals in on the planning and entitlement. These happened to be a backup again. So it’s taking some time to get some of those back through a re-entitlement process. But we’re comfortable with the stage of progress that we’re going through. Consciously in 2013 we were backing off a little bit to go more even flow so we were not preselling lots to builders who were going to participate in the upside. But I think we’re really just showing a natural progression as we go along. We could accelerate some of those if we felt it was appropriate if we get the re-entitlement side of things done in time. And that goes region by region. Austin is a prime example of that where we’ve been hoping to bring those projects on. We have two of them anticipated coming in, one in Q2 of this year and the other one is going to be closer to the backend of the year with respect to that. But there’s still some re-entitlement going through in that process just to get it to that point where we can service and sell.

And from an absorption standpoint, it looks like the absorption rate you’re assuming in 2014 might be a little lower year on year. Is that true and what kind of absorption rate are you assuming as we go into 2014 and will that accelerate?

This is Craig. I would say that we would assume our normal absorption rate is going to be similar to what we had in 2013. I think probably why you raise that point is we obviously show an increase in the community count from 47 to net 57. One of those new communities starts to come on towards the end of the year and I think that’s probably what’s distorting the numbers somewhat.

(Operator Instructions). The next question is from Frank Mayer of Vision Capital. Please go ahead.

Congratulations on a fine year. You indicated that you purchased a whole bunch of land last year, $358 million, of which the majority was in Canada. Could you give us some color on what was purchased and what holes they filled in terms of the scheduling of development and so on?

I think it was equal between Canada and the U.S, Frank. So it’s roughly half and half. I’m just trying to remember specifically. A number of them would have been some continued to fill the pipeline in Ontario and I’m just trying to think back. We did a few more deals in northern California, some shorter term deals up in the Bay Area. I don’t have the list right in front of me, but nothing of any major consequence. We did some medium-term stuff in Alberta, some outlying area just outside of Calgary for instance. But nothing that jumps out as a major one off or anything like that. There was just a number of different small pieces. I can try and give you a better sense of that later on. I just don’t have it at the top of my head right now.

That would be helpful. With regard to the increase in the cash flow to $5.5 billion from roughly the $5 billion level, how did you deal with the exchange rate fluctuations in the course of 2013? In other words, was the $5.5 billion would have been greater if the Canadian dollar hadn’t come down during the course of the year?

Yeah, I think it was -- I think, it was $0.95 we used. Is that right?

Yeah. Frank, it’s Craig. We assume obviously in a mid and long term perspective that power for the dollar.

I’m sorry? Say that again. I didn’t hear you.

We assume rates past the next year or two that we have power for the Canadian, U.S dollar.

You assume power?

For the next couple of years.

Now, the second question I have regarding the $5.5 billion, clearly that would throw off a lot of cash flow and earnings to all the investors in your company. What is deemed to happen through that cash flow in this model, in this calculation? In other words is it paid out? Is it reinvested? Does it still there sterile?

Yeah. That number for purposes is really just showing a static cash flow kicks off of the existing assets that we own at this point in time. Obviously as we go forward, we would be reinvesting or distributing, looking at all the various options with respect to that cash flow as we go forward. It’s not going to be a wide document that way.

So in other words, that’s a very -- that’s like an extremely conservative cash flow on the premise that management is capable of reinvesting whatever portion of the funds it chooses not to distribute to the investors, that number could be enhanced in the future.

Yes. It’s just intended to show what cash flow would take off of existing assets. That’s really all -- you’re exactly right.

There are no more questions at this time. I’ll turn the conference back over to Mr. Norris.

Thank you. So thanks very much for dialing into our yearend earnings call. At this time we’d like to thank all the shareholders for your confidence and support in our company and we look forward to building on our 2013 results and continuing to reward your investment in us in the coming us. So thank you very much, indeed.

This concludes today's conference call. You may now disconnect your lines. Thank you for participating and have a pleasant day.