2008 annual report for Timbercreek Mortgage Investment Corporation (TSX: TMC).

1. Timbercreek
Mortgage Investment Corporation
9,000 years ago this was
a simple and smart idea
it still is
Annual Report 2008

2. Remember when investing in real estate seemed
like a good idea? Predictable return. Your capital
wasn’t at risk of disappearing overnight. Then this:
sub-prime mortgages. Credit crisis. Foreclosures.
Job losses. Recession.
Turns out real estate investing is just like everything
else. There is good real estate investing, and
not-so-good real estate investing.
At Timbercreek Mortgage Investment Corporation,
we make a living investing in real estate. To succeed
at it, we have one core rule: keep it simple. We only
invest in commercial mortgages. We only invest in
companies that have the cash flow to pay us back.
We only lend against security that can cover our
principal. We diversify across Canada and actively
manage our investments so that we can keep on
keeping it simple.
We think this is smart.

3. 0 impaired loans
of portfolio secured by
82% income producing assets
66% average loan-to-value
9% annualized yield in 2008
secured by
50% multi-residential assets

4. Introducing the capital stack,
and where we fit in
Preservation of capital, attractive stable returns. These are our objectives. We offer a real estate
investment opportunity that generates attractive yields without the volatility and risk associated with
equity. We combine the expertise and discipline of commercial lending with the insight to spot
attractive investment opportunities in inefficient markets.
highest
risk / return
lowest
*based on an issue price per unit of $10.

5. 3
Equity REITs This is where most people instinctively
think of investing their real estate
Direct Ownership dollars; however, equity is effectively
unhedged and therefore very volatile.
Equity investors must accept downside
risk in order to fully share in the
upside potential.
Customized Timbercreek Mortgage These are relatively small short-term,
customized loans. These loans warrant
Mortgages Investment Corporation higher yields than bank mortgages,
but not the risk and volatility associated
with equity. Banks typically overlook
these loans because they prefer to
devote resources to larger loans that
are outstanding for a longer duration.
Bank Mortgages Banks These are traditionally very
safe and conservatively managed
Credit Unions investment vehicles, and, accordingly,
Trust Companies have lower rates of return. This is
an institutionalized market place
dominated by large, well capitalized
financial services firms looking for
bond-like investments.

6. Timbercreek customized lending
and why it is beneficial to the borrower
Why do you pay more for a luxury vehicle than an entry level car? Features and benefits. It’s the same
for mortgages. We provide loans to experienced real estate investors who are looking for deal terms that
are tailored to their needs. We also have a reputation for delivering on our promises, which is critical in a
time-sensitive real estate environment.
borrower opportunity lender
Bank
Timbercreek
Borrower owns a 50-unit complex, Neighbouring property has
with a strong 5-year track record for come for sale, however,
managing the complex. the deal must close
in 2 weeks.

7. 5
timing loan size term payment
8
weeks+
Appraisal comes
in at $1,000,000,
prepared to lend
up to $600,000
Typically 5–10
years fixed loan
Interest of 7%,
amortized over
15 years, payment
of $5,392
2
Appraisal comes Up to a 3-year term Interest of 9%,
in at $1,000,000, with options for interest only
prepared to lend early repayments loan, payment
up to $700,000 and substitution of of $5,250
real estate asset
used as security
weeks
faster more more cash flow
support flexible friendly

8. The blueprint of a transaction
Every deal is subject to a rigorous review process and requires unanimous investment committee
approval. Once funded, we actively manage every loan. This means communicating regularly with
borrowers to understand their repayment strategies. Developing a strong relationships with the
borrower is critical to the success of the loan and to becoming a borrower of choice in the future.
referral analysis site visit
Deal flow sourced through: Loan-to-value Visit every site prior
to loan approval
Extensive network of investment Tenant quality
banking professionals across Canada Assess traffic flow
Local market
Repeat borrowers Review building condition
Vacancy rate
Referrals Interview manager
Cap rate and owner
Sensitivity analysis
Step 1 Step 2 Step 3

9. 7
due diligence investment committee review ongoing / active management
Credit checks Must comply with asset Periodically visit sites
allocation model
Discounted cash flow Closely monitor interest payments
analysis Location / region is stable / growing
Maintain constant communication
Legal review Exit strategy is strong and clear with borrowers
Environmental review Must be unanimously approved
Independent Deal term meets the minimum
appraisal report yield requirements
Step 4 Step 5 Step 6

10. Portfolio allocation
To manage risk, our portfolio must adhere to a strict asset allocation model. The model we have
adopted is designed to diversify the portfolio based on geographical, economic sector, term, borrower
and loan-to-value criteria. This strategy has allowed us to preserve your capital while still generating an
annualized 9% return in 2008. And, we believe this strategy will allow us to continue to meet or exceed
our targeted yield of the Government of Canada 2-year bond yield plus 550 basis points.
By Type
44% Multi-residential
27% Retail
9% Other-residential
9% Office buildings
4% Unimproved land
4% Industrial
3% Single residential

11. 9
By Region
36% Ontario
35% Alberta
25% Quebec
3% British Columbia
1% Saskatchewan
0% Manitoba
By Loan-to-value
23% 71%–75%
22% 61%–65%
16% 76%–80%
14% 55% or less
12% 66%–70%
8% 56%–60%
4% 81%–85%

12. Board of directors
Zelick L. Altman (Independent Director) is a Managing Director of LaSalle Investment Management responsible for
its Canadian operations. In addition, Zelick is President of the LaSalle Canadian Income & Growth Funds, co-mingled
funds with over $500 million of equity committed. As Managing Director for Canada, he is involved with all aspects
of the business, with special emphasis on the company’s acquisition program. He has over 25 years of real estate
experience in institutional, public and private sectors of the industry. Prior to joining LaSalle, he served as a Senior
Vice President with Dundee Realty Corp., CREIT, and Counsel Property Corporation where he had responsibilities
including acquisitions, asset management, and disposition of properties across Canada. He is a graduate of the
Faculty of Applied Sciences at the University of Toronto and is registered as a Professional Engineer.
Edward W. Boomer (Independent Director) is the Managing Director, Canadian Operations for Kimco Realty
Corporation and is responsible for all aspects of Kimco’s operations in Canada. Kimco is a self-administered real
estate investment trust and believed to have the largest portfolio of neighbourhood and community shopping
centres held by any publicly-traded real estate investment trust. He has over 18 years of real estate experience.
Prior to joining Kimco, he was the Vice-President & Territory Risk Manager with GE Real Estate. He holds a
Bachelor of Arts degree from York University’s (Economics), a law degree from Queen’s University.
Craig A. Geier (Independent Director) is Chief Financial Officer of Sulliden Exploration Inc. (TSX:SUE),
a mineral exploration company focused on the development of its Shahuindo gold-silver project located in
northern Peru. He also sits as Chairman of the Board of Microbonds Inc. and as a Board Member of DDC
International Inc. Prior to joining Sulliden, he was Chief Executive Officer of Microbonds Inc. and remains a
principal investor. From 2000–2001, he was founder and Chief Executive Officer of Sports Media Systems Inc.
and in 1999 he held the position of Executive Vice President, Trust Development with Residential Equities REIT.
He holds an Honours of Business Administration degree from the University of Western Ontario.
W. Glen Shyba (Independent Director) is Executive Vice President and Chief Operating Officer of Osmington Inc.
(“Osmington”) Osmington is a privately held owner and developer of commercial real estate, with a national
presence. He has held the same position with Osmington since its inception in 1995, where he has corporate
responsibility for acquisitions and dispositions, finance and treasury, and the firm’s development initiatives. He
has led negotiations on purchase and sale transactions in excess of $2 billion, and has structured financing
arrangements on various deals in excess of $700 billion. He has also executed numerous commercial
development projects from initial design concept through to construction. Prior to Osmington, he was Vice
President, Development for a major Canadian public company primarily engaged in large scale, mixed use
and office real property development. He holds a Bachelor of Commerce degree from the UBC.
R. Blair Tamblyn (Executive Director and Chairman) is Chief Executive Officer and a director of the Fund. He Is
also a founder and the CEO and President of the Timbercreek Asset Management Inc. (the “Fund Manager”).
He has over 10 years experience working with the public and private capital markets and has led the origination,
structuring, capitalization and execution of four distinct Timbercreek funds that currently manage over
$830 million in assets. He has also been responsible for raising over $200 million in capital through public
and private channels and has an extensive network in both institutional and retail capital markets. Prior to
founding Timbercreek in 1999, he worked at Connor, Clark & Company as a securities trader and investment
representative. He is a graduate of the University of Western Ontario.

13. 11
Investment committee
Ugo Bizzarri (Committee Member) is Chief Financial Officer (CFO) of the Fund as well as the registered Portfolio
Manager of the Fund. Mr. Bizzarri is also a founder of the Fund Manager where he currently holds the title of CFO.
Since the inception of the Timbercreek real estate funds in 1999, he has directed the acquisitions of greater than
$700 million worth of Multi-Residential Real Estate for these funds. From 1994 to April 2000, he was in Portfolio
Management at the Ontario Teachers’ Pension Plan Board (OTPPB) where he played a leadership role in the
strategic planning, corporate transactions/restructuring and property acquisitions for the Real Estate Group of
OTPPB. He has been involved as a negotiator and manager in approximately $20 billion worth of real estate
transactions in the last ten years. He is a graduate of the Richard Ivey School of Business and is a Chartered
Financial Analyst. He is a graduate of the Faculty of Applied Sciences at the University of Toronto and is
registered as a Professional Engineer.
Chris Humeniuk (Committee Member) is a co-founder of Canadian Mortgage Strategies & Investments (“CMSI”)
where he currently holds the title as Managing Director. Prior to co-founding CMSI, he was employed as a
mortgage broker at Canada ICI Commercial Mortgages from 1999 through 2002. From 1997 to 1999, he was
employed as a mortgage broker at ICI Mortgage Services Limited. From 1995 to 1996, he was employed as a
mortgage broker at Dominion Mortgage Corporation and from 1990–1995 he was employed by Forsgate Funding
Corporation Inc., a private real estate lending and development company. Overall, he has over 15 years of real
estate and mortgage experience. Mr. Humeniuk is a graduate of the University of Western Ontario with a Degree
in Economics.
Andrew Jones (Committee Member) is Chief Credit Officer of the Fund Manager. His primary responsibilities include
originating and structuring debt and warehouse facilities for the Fund and the Fund Manager as well as directly
administering the mortgage portfolio of the Fund from origination through to repayment. In 2002, he co-founded a
commercial mortgage brokerage firm with offices in Toronto, Montreal, Edmonton and Vancouver. He has structured
and been the lead originator of approximately $1.2 billion in mortgage loans over the last five years. From 1997
through 1999, he held the positions of Vice-President, Finance at Residential Equities REIT and Vice-President,
Finance at Dundee Realty Corporation. He is also a Trustee of Timbercreek REIT and a Member of the mortgage
advisory committee for the Fund. He is a graduate of the University of British Columbia and has worked in the
commercial real estate and mortgage business for over 15 years.
Pamela Spackman (Independent Committee Member) has been active in the commercial real estate finance
industry since 1986. Most recently she spent 8 years as President and CEO of Column Canada Financial
Corp. and as a Director at Credit Suisse. In this position she directed the group in Canada responsible for the
origination, structuring and securitization of commercial mortgage loans for Credit Suisse CMBS program. Prior
to joining Credit Suisse, she was Vice President, Mortgage Investments directly responsible for the creation
and management of the commercial mortgage-lending program for British Columbia Investment Management
Corporation (bcIMC).

14. Long-term views. Value investing. Focus on process.
Research and analysis. An active management style.
That sums up our investment philosophy. Let us
explain in clear terms exactly what we mean by
these words and, in doing so, capture why we’re
confident in our future.

15. 13
Letter to shareholders
While we were not immune to the challenges presented Furthermore, with over 65 years of cumulative
by the global macroeconomic crisis in 2008, I believe that experience, our management team provides the Fund
the performance of Timbercreek Mortgage Investment with a true competitive advantage. Specifically, Andrew
Corporation (the Fund) in its first year as a public Jones brings deep experience and a developed network
entity underscores the soundness of our investment of long-term relationships in the commercial real estate
thesis; to provide investors looking for alternative asset and mortgage lending community, which are invaluable to
class investments with a with a low-risk opportunity to the Fund. Andrew’s expertise and reputation, cultivated
generate predictable cash flow. over the past 15 years, is considered key to generating
a broad range of opportunities, ultimately facilitating
We believe this opportunity is the result of an imbalance improved deal flow.
between quality borrowers and lenders—one that was
exacerbated in 2008 by the tightening credit markets. At Timbercreek, we start with a robust asset allocation
This underserved market, created by insufficient model. We believe that the reduction in systemic risk
competition among Canadian financial institutions that diversification provides is more important to capital
and the small number of quality private lenders, has preservation than any one loan could be. We’ve adopted
presented an opportunity for Timbercreek to thrive. this model to ensure that capital preservation and the
achievement of our investment objectives remain at
Our Fund’s performance also reaffirmed our most the forefront of every decision. Specific thresholds
strongly held fundamental belief: that real estate is still determined by this model are monitored regularly and
an excellent place to invest and a sound investment each new investment must comply with its restrictions.
opportunity for investors seeking an alternative asset
class investment. In our opinion, the key is to find a Given our strong focus on reduced risk and capital
vehicle that provides transparency down to the asset preservation, it should be noted that the fund has no
level, strong independent governance, a fee structure exposure to securitized pools of mortgage loans or other
that aligns investors and management, and a manager sub-prime mortgage loans. It should also be noted that
that takes a hands-on active approach to investing in we currently have no debt on our balance sheet. We feel
real estate. strongly that we can achieve our targeted returns without
the added risk that leverage provides.
Our Fund, while relatively new to the market, has a
strong foundation of experience behind it. Timbercreek Our rigorous investment process includes a regular
Asset Management has been successfully structuring, macro-level economic analysis of various geographic
capitalizing and subsequently managing assets for more locations and properties to determine potential
than 10 years, and now has over $830 million in assets opportunities. Next, we evaluate the attributes of individual
under management. mortgage investment opportunities within this universe.
Opportunities identified during this initial review are then

16. Opportunities identified during this initial review are then To conclude, we believe this approach to investing will
subject to intense scrutiny to ensure they meet the continue to mitigate risk while at the same time provide
highest thresholds. In addition, our two-tiered advisory very acceptable returns. Current turmoil in the Canadian
structure enforces strong governance and compliance real estate market will continue to create opportunities,
with our internal standards, ensuring that only after as quality borrowers with quality real estate assets turn
an investment opportunity has passed our rigorous to Timbercreek to meet their short-term credit needs.
standards do we invest. A tightening of credit conditions within the Canadian
banking system should further support this business
We are thrilled that Pamela Spackman is chairing model and bolster demand for our product.
the Mortgage Advisory Committee—her decades of
experience in the lending community are an enormous As such, we believe the Fund is well positioned to
resource to the Fund. execute on the strategic initiatives that will build value:
to make smart investments in the Canadian real estate
We are also indebted to the independent Board of market that provide ample risk-adjusted returns.
Directors for the time and energy that they have allocated
to the Fund’s creation, and their help in generating the I look forward to reporting to you on our progress
momentum that the Fund now enjoys. I am thrilled to during 2009.
be able to work with such a diverse group, and certainly
appreciate the extensive experience and integrity that
they bring to the Fund.
Lastly, I need to speak to current composition of our loan
portfolio. To ensure our loans, which are directly secured R. Blair Tamblyn
by residential, office, retail and industrial real property, will CEO and President
remain in good standing we take a hands-on approach, Timbercreek Mortgage Investment Corporation
actively managing each investment. Currently, over 50%
of the Fund’s capital is invested in mortgages secured
by multi-residential properties—an asset class that has
proven to be a safe harbor in times of economic turmoil.
Further, given the health of our loan portfolio, and lack
of any impairments to date, we can focus on proactively
growing the Fund to its targeted size rather than reactively
working out loans that are no longer performing.

17. 15
Annual Management Report of Fund Performance
For the period from April 30, 2008 (date of incorporation) to December 31, 2008
This annual management report of fund performance contains financial highlights but does not contain the complete
annual financial statements of the Timbercreek Mortgage Investment Corporation (the “Fund”). You can get a copy of
the annual financial statements at your request, at no cost, by any of the following:
Phone: Calling the Fund at (416) 306-9967 ext. 250 (collect if long distance), Carrie Morris, Investor Relations; or
Internet: visiting SEDAR at www.sedar.com; or
Mail: Writing to the Fund at:
Timbercreek Mortgage Investment Corporation
25 Price Street
Toronto, Ontario
M4W-1Z1
Shareholders may also contact us using one of these methods to request a copy of the Fund’s proxy voting policies
and procedures, proxy voting disclosure record, or quarterly portfolio disclosure.
Timbercreek Annual Report 2008

18. Management’s Discussion and Analysis of Fund Performance
This Management’s Discussion and Analysis of Timbercreek Mortgage Investment Corporation’s (the “Fund”) per-
formance is based on the views of the Fund’s management as of December 31, 2008 and is not intended to provide
legal, accounting, tax or investment advice.
Investment Objectives and Strategies
The Fund was incorporated on April 30, 2008 under the laws of the Province of Ontario and commenced operations on
July 7, 2008 when it completed an initial public offering (the “IPO”) of Class A shares and issued Class B shares through
a private placement in connection with the acquisition of the initial mortgage portfolio. It is the intention of the Fund to
qualify as a “mortgage investment corporation” as defined under Section 130.1(6) of the Income Tax Act (Canada).
The fundamental investment objectives of the Fund are to:
• Provide shareholders with a stable stream of monthly distributions targeting an annual yield of the 2-year
Government of Canada Bond plus 550 basis points by acquiring and maintaining a diversified portfolio of
mortgage assets; and
• Preserve net asset value of the Fund.
The Fund intends on meeting its investment objectives by investing in a diversified portfolio of mortgage loans secured
directly by residential (including multi-residential), office, retail and industrial real property across Canada, primarily
located in large urban markets and surrounding areas.
Risk
There was no material change since November 27, 2008, which affected the overall level of risk associated with an
investment in the Fund.
The risks of investing in the Fund remain as discussed in its prospectus dated November 27, 2008 (the “Prospectus”).
There is no assurance that the Fund will be able to achieve its objectives or earn any return.
Results of Operations
Total revenue earned by the Fund for the period ended December 31, 2008 was $2,014,061, which is composed of
interest income of $1,888,810 and lender fees of $125,881.
During the period ended December 31, 2008, the Fund advanced $42,932,126 in mortgage loans (of which $13,993,376
was acquired in exchange for Class B shares of the Fund) and received repayment of $3,631,803, resulting in a total
mortgage investments at year-end of $39,300,323 with a weighted average interest rate of 11.61%. At year-end, the
Fund had cash and cash equivalents of $11,506,658 available to fund new mortgage investments.

19. 17
As discussed below, as a result of the continued market volatility in the Canadian financial and economic sectors,
Timbercreek Mortgage Strategies Inc. (the “Mortgage Manager”) remains cautious and, within the context of the Asset
Allocation Model, continues to almost exclusively pursue new mortgages secured by income-producing properties.
For the period from July 7, 2008 (the date the Fund commenced operations following the IPO) to December 31, 2008,
the Fund experienced an increase in net assets from operations of $1,494,809, or an increase per Class A share of
$0.35 and $0.39 per Class B share.
Based on a distribution of $0.44 and $0.48 per Class A and Class B share, respectively, this resulted in an annualized
return of 9.10% per Class A share and 9.89% per Class B share, based on an issue price per unit of $10.00, from
inception to year end. This is consistent with the targeted return provided by the Fund Manager of approximately 9%,
which was included in the IPO prospectus and the Prospectus. The average 2-year Government of Canada Bond rate
plus 550 basis points for the period ended December 31, 2008 was 7.84%.
Table 1: Reconciliation of Net Earnings Available for Distribution
For the period ended December 31, 2008
Increase in net assets from operations $ 1,494,809
Adjustments:
Future tax expense, non-cash item 8,723
Lender fees received, but not earned under GAAP in the year1 333,172
$ 1,836,704
Dividends to Class A shareholders $ 1,145,706
Dividends per Class A share $ 0.44
Dividends to Class B shareholders $ 689,897
Dividends per Class B share $ 0.48
Payout ratio 99.9%
1 For Canadian Income Tax purposes lender fees are included in taxable income of the Fund for the year ended December 31, 2008.
In accordance with Canadian GAAP and the accounting policy of the Fund, lender fees are amortized over the term of the loan.
Timbercreek Annual Report 2008

20. The majority of the Fund’s expenses consist of management fees of $236,147 and performance fees, net of waivers
and absorptions, of $34,894. The remainder of operating expenses of $248,211 relate mainly to the operation of the
Fund and administration of the mortgage portfolio.
The Fund had no redemptions in 2008.
Recent Developments
As credit markets around the world contracted through the second half of 2008, traditional Canadian lending insti-
tutions dramatically reduced the amount of capital available for mortgage lending against investment real estate,
creating an opportunity for non-traditional lenders to grow. This has allowed the Fund to invest in mortgage loans with
lower overall risk while maintaining its targeted yield to investors.
Due to the continued expected volatility in the economy in 2009, in the last six months of 2008 the Mortgage Manager
and Mortgage Advisory Committee focused exclusively on mortgage loans which were secured by assets that are
generating cash flow. Until the economic environment improves, the Mortgage Manager has moved away from
financing projects which require sales or a capital gain in order for the borrower to execute on its exit strategy — which
is imperative due to the short-term nature of the Fund’s mortgage investments.
The Fund continued to comply with the Asset Allocation Model adopted by Timbercreek Investments Management
Inc., (the “Fund Advisor”) for the Fund and has maintained a portfolio of mortgage investments which, amongst other
things, is well diversified by the type of real estate, as well as by the geographic location of the real estate.
At December 31, 2008, the Mortgage Manager made the decision to forego a portion of its performance bonus.
While the performance fee of the Mortgage Manager is earned on net earnings available to distribute over the average
2-year Government of Canada Bond Yield plus 450 basis points, the Fund Manager had targeted an annualized
yield of approximately 9%, net of all fees and expenses of the Fund in the first year of operation (based on an issue
price of $10 per share). As the costs associated with the launch of the Fund were greater than originally expected,
the Mortgage Manager felt it was appropriate to forego a sufficient amount of the performance bonus such that the
targeted annualized yield was achieved for both Class A and Class B investors. As a result, the Mortgage Manager
waived $88,591 of performance fees earned during the period ended December 31, 2008.
Related Party Transactions
As disclosed in detail in the Prospectus, on July 7, 2008, the Fund acquired a portfolio of 12 mortgage assets of
Timbercreek Mortgage Investment Fund (“TMIF”) and the outstanding trust units of TMIF in exchange for 1,509,279
Class B shares of the Fund for a total consideration of $15,008,141. Before July 7, 2008, TMIF was a related party by
virtue of common management, and after July 7, 2008 became a wholly owned subsidiary of the Fund.

21. 19
The Fund, Timbercreek Asset Management Inc. (the “Fund Manager”) and the Mortgage Manager are related by virtue
of common management. All transactions between related parties were in the normal course of operations and were
measured at the exchange amount, which is the amount of consideration established and agreed upon by the related
parties. Related party transactions include the following transactions and balances:
During the period ended December 31, 2008, the Fund was charged fees by the Fund Manager of $236,147 for
general management and administration services. The Fund Manager is entitled to a fee of 1.2% per annum of the
gross assets of the Fund (the “Management Fees”), plus applicable taxes, calculated daily and paid monthly in arrears.
During the period ended December 31, 2008, the Mortgage Manager earned a performance fee of $123,485 for
management and administration of the Fund’s mortgage portfolio. As described above, the Mortgage Manager waived
$88,591 of the performance fee earned and charged the Fund $34,894. In any calendar year where the Fund has net
earnings available for distribution to shareholders in excess of the Hurdle Rate (Hurdle Rate is defined as the average
2-year Government of Canada Bond Yield for the 12 month period then ended plus 450 basis points), the Mortgage
Manager is entitled to receive from the Fund a performance fee equal to 20% of the net earnings of the Fund available
to distribute over the Hurdle Rate (the “Performance Fees”).
In determining the Performance Fee, on a monthly basis the Fund Manager will calculate the earnings available to dis-
tribute in that month that are required to achieve the Hurdle Rate, based on the outstanding Share capital of the Fund,
net of issue costs, calculated daily. An amount equal to 20% of any net earnings available to distribute in excess of the
Hurdle Rate in that month will be deducted from the Fund’s monthly distribution and retained by the Fund. The Fund
Manager will calculate the final Performance Fee in respect of a completed calendar year based on the audited
financial statements for that year. The Performance Fee in respect of a calendar year will be payable to the Mortgage
Manager within 15 days of the issuance of the Fund’s audited financial statements for that year.
In the event of a redemption of shares by the Fund, any dividends declared by the Fund during the calendar year
in which the redemptions have taken place will be annualized and evaluated with respect to the Hurdle Rate.
Fees payable to the Mortgage Manager shall be, in any calendar year where the Fund has net earnings available
for distribution to shareholders in excess of the Hurdle Rate, 20% of such excess.
Timbercreek Annual Report 2008

22. Financial Highlights
The following tables show selected key financial information about the Fund and are intended to help you understand
the Fund’s financial performance for the past year.
Period Ended December 31, 2008
The Fund’s Net Assets per Class A Share (1)
Net Assets, beginning of period $ 9.33
Increase (decrease) from operations:
Total revenue 0.49
Total expenses (0.14)
Realized gains (losses) for the period –
Unrealized gains (losses) for the period –
Total increase (decrease) from operations (2) 0.35
Distributions:
From Income (excluding dividends) (see Table 1) (0.44)
From Dividends –
From Capital Gain –
Return of Capital –
Total Distributions for the period (3) (see Table 1) (0.44)
Net Assets, as at December 31, 2008 (GAAP) $ 9.21
Ratios And Supplemental Data
Total net asset value (000’s) (4) $ 36,502
(4)
Number of shares outstanding 3,889,562
Management expense ratio* (5) 3.13%
*
Management expense ratio before waivers or absorptions 3.67%
* (6)
Trading expense ratio 0.07%
Portfolio turnover rate (7) 10.19%
Net asset value per share, as at December 31, 2008 (Net Redemption Value) $ 9.38
Closing market price $ 9.00
* annualized
(1) This information is derived from the Fund’s audited annual financial statements. The net assets per share presented in the financial state-
ments differ from the net asset value calculated for fund pricing purposes. An explanation of these differences can be found in the notes
to the financial statements. This difference is due to including costs associated with establishment, structuring and periodic offering of
securities of the Fund attributable to a particular class of shares being amortized monthly over a period of five years.
(2) Net assets and distributions are based on the actual number of shares outstanding for the relevant class at the relevant time. The increase/
decrease from operations is based on the weighted average number shares outstanding for the relevant class over the financial period.
(3) Distributions were paid in cash.
(4) This information is provided as at December 31, 2008.

23. 21
Period Ended December 31, 2008
The Fund’s Net Assets per Class B Share (1)
Net Assets, beginning of period $ 9.84
Increase (decrease) from operations:
Total revenue 0.50
Total expenses (0.11)
Realized gains (losses) for the period –
Unrealized gains (losses) for the period –
(2)
Total increase (decrease) from operations 0.39
Distributions:
From Income (excluding dividends) (see Table 1) (0.48)
From Dividends –
From Capital Gain –
Return of Capital –
(3)
Total Distributions for the period (see Table 1) (0.48)
Net Assets, as at December 31, 2008 (GAAP) $ 9.77
Ratios and Supplemental Data (4)
Total net asset value (000’s) (4) $ 14,796
Number of shares outstanding (4) 1,502,279
Management expense ratio* (5) 2.05%
*
Management expense ratio before waivers or absorptions 2.41%
Trading expense ratio* (6) 0.07%
(7)
Portfolio turnover rate 10.19%
Net asset value per share as at December 31, 2008 (redemption value) $ 9.85
Closing market price N/A
(5) Management expense ratio is based on total expenses (excluding commissions and other portfolio transaction costs) for the stated period
and is expressed as an annualized percentage of daily average net asset value during the period.
(6) The trading expense ratio represents the mortgage transaction costs incurred on a particular mortgage investment as an annualized
percentage of semi-monthly average net assets during the period. Typically, the borrower of a particular mortgage will reimburse the
Fund for transaction costs, although situations may arise where the Fund may incur the costs.
(7) The Fund’s portfolio turnover rate indicates how actively the Fund Advisor managed the Portfolio investments. A portfolio turnover rate
of 100% is equivalent to the Fund advancing and receiving repayment of all mortgage loan investments once in the course of the year.
There is not necessarily a relationship between a high turnover rate and the performance of a fund.
Timbercreek Annual Report 2008

24. Management Fees
A summary of management fees paid for the period ended December 31, 2008, including a breakdown of services
received by the Fund is included in “Related Party Transactions”.
Class A shares of the Fund pay each registered dealer a servicing fee equal to 0.75% per annum of the net redemption
value per Class A share of the Fund (the “Servicing Fee”). The fee is calculated and paid at the end of each calendar
quarter.
In addition to the management fees disclosed above, the Fund will pay for all expenses incurred by it in connection
with the operation and management, including but not limited to any additional fees payable to the Fund Manager for
performance of extraordinary services on behalf of the Fund for services outside the scope of the Fund Management
Agreement.
A summary of the management fees paid during the period ended December 31, 2008 includes:
$ %
Management Fees 236,147 65
Performance Fees* 34,894 10
Servicing Fees 91,484 25
362,525 100
* The Mortgage Manager earned performance fees for the period ending December 31, 2008 of $123,485, but waived $88,591 resulting in
total fees of $34,894.

25. 23
Summary of Investment Portfolio
Net Assets %
($) of Net Assets
Mortgages 39,300,323 77.8
Cash and Cash Equivalents 11,506,658 22.8
Net Other Assets (297,308) -0.6
Outstanding Loan-to- Interest Allocation % of
Summary of Top 25 Holdings Prov. Principal value Term Rate Position Product Type NAV
Cash & Cash Equivalents N/A $ 11,506,658 N/A N/A N/A N/A N/A 22.8%
Summit Glen Portfolio, Toronto ON $ 3,318,000 74.3% 18 12.90% Second Multi-Residential 6.6%
Reneaude-Lapointe Recreation Centre, Montreal QC $ 3,200,000 67.5% 36 10.90% First Retail 6.3%
Dodson Plaza Shopping Centre, Drayon Valley AB $ 2,750,000 65.9% 36 12.09% First Retail 5.4%
Charest Boulevard Building, Quebec City QC $ 2,250,000 77.1% 12 11.80% First Office Buildings 4.5%
Ascot Rental Townhomes, Edmonton AB $ 1,980,000 74.9% 36 11.82% First Multi-Residential 3.9%
CRG Office, Toronto ON $ 1,800,000 79.4% 36 11.40% First Retail 3.6%
Lovinac Manor, Edmonton AB $ 1,790,000 61.7% 12 9.40% First Multi-Residential 3.5%
Gateway Mobile Home Park, Ft. McMurray AB $ 1,780,000 42.6% 24 13.19% First Other-Residential 3.5%
Grand Design Homes Residential Lots,
Edmonton AB $ 1,675,197 46.0% 12 10.90% Second Unimproved Land 3.3%
Rock Grove / Westview Manor,
Hinton & Red Deer AB $ 1,600,000 61.8% 12 12.38% First Multi-Residential 3.2%
The Mark on Jasper, Edmonton AB $ 1,500,000 44.4% 12 11.90% First Multi-Residential 3.0%
Augusta Apartments, Ottawa ON $ 1,400,000 72.1% 16 11.90% Second Multi-Residential 2.8%
Starwood Manufacturing, Mississauga ON $ 1,300,000 61.0% 12 11.90% Second Industrial 2.6%
Van Horne & Linton Apartments, Montreal QC $ 1,250,000 79.8% 12 8.90% First Multi-Residential 2.5%
Honey Harbour Mobile Home Park,
Georgian Bay ON $ 1,050,000 71.1% 24 11.31% First Other-Residential 2.1%
Walmer and Spadina Apartments, Toronto ON $ 1,000,000 57.6% 24 11.50% Second Multi-Residential 2.0%
Bois de Boulogne Apartments #2, Montreal QC $ 1,000,000 56.5% 13 11.40% Third Multi-Residential 2.0%
Gateway Village Residential, Pemberton BC $ 995,661 60.4% 6 13.12% First Multi-Residential 2.0%
Queen East Mixed Use Building, Toronto ON $ 855,784 70.2% 12 12.00% Second Retail 1.7%
Queen Mary, Montreal QC $ 825,000 84.0% 12 11.90% Second Office Buildings 1.6%
Crawford Court, Oakville ON $ 787,500 65.6% 12 6.40% First Multi-Residential 1.6%
Western Square Plaza, London ON $ 700,000 82.7% 12 11.90% Second Retail 1.4%
Lake Rosseau Residential, Muskoka ON $ 675,000 74.2% 12 14.25% First Single-Residential 1.3%
Mirror Lake Retail Complex, Camrose AB $ 547,931 72.0% 24 10.25% First Retail 1.1%
95.0%
Timbercreek Annual Report 2008

26. Asset Allocation
By Type
44% Multi-residential
27% Retail
9% Other-Residential
9% Office buildings
4% Unimproved land
4% Industrial
3% Single Residential
By Region
36% Ontario
35% Alberta
25% Quebec
3% British Columbia
1% Saskatchewan
0% Manitoba
By Interest Rate (excluding fees earned by the Fund)
31% 11.50%–11.99%
14% 12%–12.49%
12% 10% or lower
12% 10.50%–10.99%
11% 11%–11.49%
9% 12.50%–12.99%
7% 13%–13.49%
2% 14% or greater
1% 10%–10.49%
1% 13.50%–13.99%

27. 25
By Maturity
53% Maturing in 2009
35% Maturing in 2010
25% Maturing in 2011
By Loan-to-value
23% 71%–75%
22% 61%–65%
16% 76%–80%
14% 55% or less
12% 66%–70%
8% 56%–60%
4% 81%–85%
By Term
42% 7–12 months
26% 25–30 months
17% 13–18 months
12% 19–24 months
3% 0–6 months
Timbercreek Annual Report 2008

28. Management’s Responsibility for Financial Statements
To the shareholders of Timbercreek Mortgage Investment Corporation
The accompanying consolidated financial statements of Timbercreek Mortgage Investment Corporation (the “Fund”)
were prepared by management, which is responsible for the integrity and fairness of the information presented,
including the amounts that are based on estimates and judgments. Management is also responsible for ensuring
that these consolidated financial statements are prepared and presented in accordance with generally accepted
accounting principles in Canada. Financial information appearing throughout this annual report is consistent with
these consolidated financial statements.
In discharging its responsibility for the integrity and fairness of the consolidated financial statements and for the
accounting systems from which they are derived, management maintains the necessary system of internal controls
designed to ensure that transactions are authorized, assets are safe-guarded and proper records are maintained.
PricewaterhouseCoopers LLP, the independent auditors, have performed an independent audit in accordance with
generally accepted auditing standards in Canada, of the consolidated financial statements and their report follows.
The shareholders’ auditors have full and unrestricted access to the Audit Committee to discuss their audit and
related findings.
The Board of Director’s is responsible for ensuring that management fulfills its responsibilities for financial reporting
and internal controls and engaging the independent auditors. The Board of Director’s carries out this responsibility
through its Audit Committee, which is composed entirely of independent Director’s. The consolidated financial
statements have been reviewed and approved by the Board of Director’s and it’s Audit Committee. The independent
auditors have direct and full access to the Audit Committee and Board of Director’s.
R. Blair Tamblyn Ugo Bizzarri
President and Chief Executive Officer Chief Financial Officer
Toronto, Ontario, Canada Toronto, Ontario, Canada
February 23, 2009 February 23, 2009

29. 27
Auditors’ Report
February 23, 2009
To the Shareholders of Timbercreek Mortgage Investment Corporation
We have audited the consolidated statements of net assets and investment portfolio of Timbercreek Mortgage
Investment Corporation (the Fund) as at December 31, 2008 and the consolidated statements of operations, changes
in net assets and cash flows for the period from April 30, 2008 (date of incorporation) to December 31, 2008. These
consolidated financial statements are the responsibility of the Fund’s management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audit.
We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require
that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement presentation.
In our opinion, these consolidated financial statements present fairly, in all material respects, the financial posi-
tion of the Fund as at December 31, 2008 and the results of its operations and its cash flows for the period from
April 30, 2008 (date of incorporation) to December 31, 2008 in accordance with Canadian generally accepted
accounting principles.
Chartered Accountants, Licensed Public Accountants
Toronto, Canada
Timbercreek Annual Report 2008

30. Consolidated Statement of Net Assets
December 31, 2008
Assets
Cash and cash equivalents $ 11,506,658
Mortgages (note 4) 39,300,323
Accrued interest receivable 339,484
Other amounts receivable and prepaids 456,427
Future income tax asset (note 1) 34,890
$ 51,637,782
Liabilities
Accounts payable and accrued expenses $ 355,553
Prepaid mortgage interest 17,252
Dividends payable to shareholders (note 5) 344,458
Due to Fund Manager (note 6) 42,780
Due to Mortgage Manager (note 6) 34,894
Unearned income 333,172
1,128,109
Net assets representing Shareholders’ Equity $ 50,509,673
Net assets, Class A $ 35,832,049
Net assets, Class B $ 14,677,524
Net assets, Voting shares $ 100
Shares outstanding (note 5)
Class A 3,889,562
Class B 1,502,279
Voting shares 100
Net assets per share (note 7)
Class A $ 9.21
Class B $ 9.77
Voting shares $ 1.00
The accompanying notes are an integral part of these consolidated financial statements.
Approved on behalf of the Board of Directors
“R. Blair Tamblyn” “Craig A. Geier”
R. Blair Tamblyn Craig A. Geier

31. 29
Consolidated Statement of Operations
For the period from April 30, 2008 (date of incorporation) to December 31, 2008
Revenue
Interest income $ 1,888,180
Fee income 125,881
2,014,061
Expenses
Management fees (note 3) $ 236,147
Performance fees (note 3) 123,485
Transfer agent fees 9,672
Directors’ fees 17,500
Custodian fees 5,250
Servicing fees (note 3) 91,484
Audit fees 61,950
Legal fees 6,319
Other operating expenses 47,313
Future tax expense 8,723
607,843
Expenses waived (note 3) (88,591)
Net expenses 519,252
Net investment income $ 1,494,809
Fair value adjustment –
Increase in net assets from operations $ 1,494,809
Other information
Increase in net assets from operations
Class A $ 930,521
Class B $ 564,288
Increase in net assets from operations per share
Class A $ 0.3474
Class B $ 0.3931
The accompanying notes are an integral part of these consolidated financial statements.
Timbercreek Annual Report 2008

32. Consolidated Statement of Changes in Net Assets
For the period from April 30, 2008 (date of incorporation) to December 31, 2008
Class A Class B Voting shares Fund
Net assets —
Beginning of period $ – $ – $ – $ –
Increase in net assets
from operations 930,521 564,288 – 1,494,809
Dividends to shareholders (1,145,706) (689,897) – (1,835,603)
Net proceeds from issuance
of shares 36,047,234 14,803,133 100 50,850,467
Total increase in net assets 35,832,049 14,677,524 100 50,509,673
Net assets — End of period $ 35,832,049 $ 14,677,524 $ 100 $ 50,509,673
The accompanying notes are an integral part of these consolidated financial statements.

33. 31
Consolidated Statement of Cash Flows
For the period from April 30, 2008 (date of incorporation) to December 31, 2008
Cash provided by (used in)
Operating activities
Net investment income $ 1,494,809
Change in non-cash balances related to operations
Increase in accrued interest income receivable (123,521)
Increase in other amounts receivable and prepaids (456,427)
Decrease in future tax asset 8,723
Increase in accounts payable and accrued expenses 323,484
Decrease in due to Mortgage Manager (18,550)
Increase in due to Fund Manager 42,780
Increase in unearned income 294,527
1,565,825
Investing activities
Funding of mortgages (28,938,750)
Discharge of mortgages 3,631,803
(25,306,947)
Financing activities
Proceeds from issuance of voting shares 100
Proceeds from issuance of Class A shares, net of costs incurred 31,812,234
Proceeds from issuance of Class B shares, net of costs incurred 4,926,591
Dividends paid (1,491,145)
35,247,780
Increase in cash and cash equivalents during the period $ 11,506,658
Cash and cash equivalents — Beginning of period –
Cash and cash equivalents — End of period $ 11,506,658
Supplementary information
Supplemental cash flow on non-cash investing and financing activities
Class B shares issued in exchange for trust units (note 2) $ 3,838,796
Class B shares issued in exchange for mortgages (note 2) 11,169,345
The accompanying notes are an integral part of these consolidated financial statements.
Timbercreek Annual Report 2008

34. Consolidated Statement of Investment Portfolio
December 31, 2008
Amortized cost Fair value
Mortgages (77.80%) $ 39,300,323 $ 39,300,323
Cash and other net assets (22.20%) 11,209,350
Net assets (100%) $ 50,509,673
Mortgage Portfolio Summary
Number of
Interest rate mortgages Amortized cost Fair value
Less than or equal to 10% 5 $ 4,590,500 $ 4,590,500
10.00% – 10.24% – – –
10.25% – 10.49% 1 547,931 547,931
10.50% – 10.74% – – –
10.75% – 10.99% 2 4,875,197 4,875,197
11.00% – 11.24% 1 378,000 378,000
11.25% – 11.49% 3 3,850,000 3,850,000
11.50% – 11.74% 2 1,400,000 1,400,000
11.75% – 11.99% 10 10,746,250 10,746,250
12.00% – 12.24% 2 3,605,784 3,605,784
12.25% – 12.49% 2 1,958,000 1,958,000
12.50% – 12.74% – – –
12.75% – 12.99% 2 3,648,000 3,648,000
13.00% – 13.24% 1 1,780,000 1,780,000
13.25% – 13.49% – – –
13.50% – 13.74% 1 250,000 250,000
13.75% – 13.99% – – –
Greater than or equal to 14% 2 1,670,661 1,670,661
34 39,300,323 39,300,323
Note: All mortgages are conventional uninsured mortgages, of which 26 mortgages totalling $31,684,323 are repayable at any time by the
borrower without penalty or yield maintenance.

35. 33
Notes to Consolidated Financial Statements
Period from April 30, 2008 (date of incorporation) to December 31, 2008
Formation of the Fund
Timbercreek Mortgage Investment Corporation (the Fund) was incorporated under the laws of the Province of Ontario
by articles of incorporation dated April 30, 2008 and is authorized to issue an unlimited number of Class A, Class B
and voting shares. The investment objective of the Fund is, with a primary focus on capital preservation, to acquire
and maintain a diversified portfolio of mortgage loan investments which generate income allowing the Fund to pay
monthly distributions to shareholders. Timbercreek Asset Management Inc. (the Fund Manager), as manager of the
Fund, is responsible for the day-to-day operations and providing all general management and administrative services.
Timbercreek Mortgage Strategies Inc. (the Mortgage Manager), a 50% owned subsidiary of the Fund Manager, is
responsible for the management and administration of the Fund’s mortgage loan portfolio.
Class A shares are available to all investors and were issued upon the conversion of subscription receipts issued
under the initial public offering (IPO) and may be issued under other offerings that may be completed in the future.
Class B shares were issued to the Timbercreek Mortgage Investment Fund unitholders in connection with the acqui-
sition of the initial mortgage portfolio by the Fund (note 2) and may also be offered in the future under available
prospectus exemptions.
The voting shares have a nominal value and are owned by certain shareholders of the Fund Manager. Accordingly,
these shareholders, as holders of all of the issued and outstanding voting shares will have the power to vote on all
matters to be considered by the holders of voting shares.
The Fund commenced operations on July 7, 2008 when it completed the IPO of subscription receipts that were
subsequently converted into Class A shares and issued Class B shares in connection with the acquisition of the initial
mortgage portfolio.
1. Summary of significant accounting policies
Basis of presentation
These consolidated financial statements have been prepared in accordance with Canadian generally accepted
accounting principles (Canadian GAAP) and include the accounts of the Fund and Timbercreek Mortgage
Investment Fund (the Trust), in which the Fund is the holder of all trust units and the sole beneficiary.
Cash and cash equivalents
The Fund considers highly liquid investments with an original maturity of three months or less to be
cash equivalents.
Timbercreek Annual Report 2008

36. 1. Summary of significant accounting policies (continued)
Mortgages
The Fund measures its investment in mortgages at fair value in accordance with Canadian GAAP Accounting
Guideline 18 Investment Companies, with any changes in the fair value of a mortgage recorded in the con-
solidated statement of operations. Fair value is the amount of consideration that would be agreed upon in an
arm’s-length transaction between knowledgeable, willing parties who are under no compulsion to act. The fair
value of the mortgages approximate their carrying value given the mortgage loan portfolio consists of short-term
loans (typically maturing within 24 months or less) that are repayable at the option of the borrower without penalty
or yield maintenance, and any renewal of the existing portfolio of mortgages would be made at the same or similar
terms based on the Fund Manager’s assessment of the current mortgage market. When collection of the principal
on a mortgage is no longer reasonably assured, the fair value of the mortgage is reduced to the estimated net
realizable value of the underlying security.
Interest and fee income
Interest income is accounted for on an accrual basis. Lender fees received are amortized to income over the
contractual terms of the mortgages. Forfeited lender fees are recognized at the time a borrower has not fulfilled
the terms and conditions of a mortgage commitment and payment has been received.
Unearned income
Unearned income includes lender fees received from borrowers, which are amortized over the contractual terms
of the mortgage to fee income.
Income taxes
The Fund qualifies as a mortgage investment corporation (MIC) for Canadian income tax purposes. A MIC is a
special purpose corporation defined under section 130.1 of the Income Tax Act (Canada) and is generally able to
deduct in computing its income for a taxation year, the amount of income for that year and within 90 days of year
end that is distributed to its shareholders. Shareholders who receive any amounts as, or on account of, a taxable
dividend, other than a capital gains dividend, will be subject to Canadian income or withholding tax accordingly.
The Fund intends to make distributions to the extent necessary to reduce its taxable income each year to $nil so
that it has no income taxes payable under Part I of the Income Tax Act (Canada) and to elect to have dividends be
capital gains dividends to the maximum extent allowable.

37. 35
MIC eligibility criteria
To qualify as a MIC for Canadian income tax purposes, the Fund must comply with the following:
i) At least 50% of the Fund’s assets must consist of residentially orientated mortgages and/or cash;
ii) The Fund’s only business activity is investing funds of the corporation and not managing or developing any real
property;
iii) The Fund must not hold any investments secured by real property situated outside Canada or have debts
owing to the Fund by non-resident individuals, other than debts secured by real property situated in Canada;
and
iv) No shareholder may own more than 25% of the issued shares of any class.
The Fund has recognized the benefit of tax-effected future deductible temporary differences of $34,890. These dif-
ferences arise primarily because of differences between the tax basis of certain financing costs and their carrying
value on the consolidated balance sheet.
As of December 31, 2008, the Fund has non-capital losses carried forward for income tax purposes of $367,000,
which will expire in 2028 if not used. The company also has future deductible share issuance and financing costs
for income tax purposes of $2,388,000 which are deductible over 5 years. The potential benefit of these tax pools
has not been recognized in these financial statements.
Financial instruments — recognition and measurement
In accordance with CICA Section 3855 “Financial Instruments—Recognition and Measurement”, TMIC is required
to classify its financial assets as one of the following: (i) held to maturity, (ii) loan and receivables, (iii) held for
trading and (iv) available for sale. Financial liabilities must be classified as: (i) held for trading or (ii) other liabilities.
The Fund has designated its financial assets and financial liabilities as follows:
Financial assets:
Cash and cash equivalents and mortgages are classified as held for trading and recorded at fair value.
Accrued interest receivable, other amounts receivable and prepaids are classified as loans and receivables and
recorded at amortized cost.
Financial liabilities:
Accounts payable and accrued expenses, dividends payable to shareholders, prepaid mortgage interest, due to
Fund Manager and Mortgage Manager are classified as other liabilities and recorded at amortized cost.
Timbercreek Annual Report 2008

38. 1. Summary of significant accounting policies (continued)
Increase in net assets per share from operations
Increase in net assets per share is based on the increase in net assets from operations attributable to each class
of shares divided by the weighted average number of shares for that class during the period.
Net assets per share
The net assets per share is calculated by dividing the net assets of a class of shares by the total number of out-
standing shares of the class at the end of the period.
Use of estimates
The preparation of consolidated financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at
the date of the consolidated financial statements and the reported amounts of revenue and expenses during the
period. Actual results could differ from those estimates. The key area of estimation where management has made
a difficult or subjective judgement, often as a result of matters that are inherently uncertain, is valuation of the
mortgage portfolio. Significant changes in assumptions could materially change the recorded carrying value.
Recent Canadian accounting pronouncements issued and not yet adopted
International Financial Reporting Standards (“IFRS”)
The Accounting Standards Board (“AcSB”) of the CICA confirmed that Canadian GAAP for publicly accountable
enterprises will be converged with IFRS effective in the calendar year 2011. IFRS will replace current Canadian
GAAP for these enterprises. The conversion to IFRS will be required for the Fund for interim and annual financial
statements beginning on January 1, 2011. Enterprises will also be required to provide comparative IFRS informa-
tion for the previous fiscal year. The Fund will implement these standards in its first quarter of the fiscal year ending
December 31, 2011 and is currently evaluating the impact of adoption on its consolidated financial statements.

39. 37
2. Acquisitions
Following the closing of the IPO on July 7, 2008, the Fund completed the acquisition of a portfolio of mortgage
investments from the Trust and acquired all of the outstanding units of the Trust. As a result of acquiring all of the
outstanding units of the Trust, the Fund became its sole beneficiary.
Pursuant to the approval by the unitholders of the Trust, the Fund acquired a portfolio of 12 mortgage invest-
ments in exchange for 1,116,934 Class B shares issued at $10 per share, for total consideration of $11,169,345.
Subsequent to the transaction, the trustees declared an in specie distribution to the Trust unitholders of record
of all Class B shares received, pursuant to this exchange. As a result of the in specie distribution, the Trust
unitholders became Class B shareholders of the Fund.
Immediately following the acquisition of the mortgage portfolio, the Fund issued 392,345 Class B shares at $10
per share in exchange for all of the outstanding units of the Trust, for total net proceeds of $3,838,796. As a result
of this transaction, the Fund holds all outstanding units of the Trust and is the sole beneficiary.
The acquisition of the mortgage portfolio and outstanding units of the Trust has been recorded using the purchase
method. The following table summarizes the preliminary fair values of the net assets acquired by the Fund.
Assets
Mortgages $ 13,993,376
Cash and cash equivalents 896,599
Future income tax asset 43,613
Interest receivable 215,963
15,149,551
Liabilities
Accounts payable and accrued expenses $ 49,321
Unearned income 38,645
Due to Mortgage Manager 53,444
141,410
Net assets acquired $ 15,008,141
Net assets acquired in exchange for:
Class B shares $ 15,008,141
Timbercreek Annual Report 2008

40. 3. Expenses
Management and performance fees
The Fund Manager is responsible for the day-to-day operations and providing all general management and
administration services to the Fund. The Fund pays the Fund Manager a monthly management fee of 1.2% for
its services, based on the gross assets of the Fund, calculated daily and payable monthly. For the period ended
December 31, 2008, the Fund incurred management fees of $236,147.
The Mortgage Manager is responsible for the management and administration of the Fund’s mortgage portfolio.
In any calendar year where the Fund has net earnings available for distribution to shareholders in excess of the
Hurdle Rate (Hurdle Rate is defined as the average 2-year Government of Canada Bond Yield for the 12 month
period then ended plus 450 basis points), the Mortgage Manager will be entitled to receive from the Fund a
performance fee equal to 20% of the net earnings of the Fund available to distribute over the Hurdle Rate. The per-
formance fee is payable to the Mortgage Manager within 15 days of the issuance of the Fund’s audited financial
statements for that calendar year. For the period ended December 31, 2008, the Fund has accrued $34,894 in
performance fees. The performance fees, net of fees waived for Class A and Class B shares, were as follows:
Class A $ 24,736
Class B 10,158
$ 34,894
Servicing fees
The Fund will pay each registered dealer a servicing fee equal to 0.75% annually of the net redemption value per
Class A share for each Class A share held by clients of the registered dealer, calculated and paid at the end of
each calendar quarter. For the period ended December 31, 2008, the Fund incurred servicing fees of $91,484.
Fund operating expenses
Each class of shares is responsible for the payment of its proportionate share of common operating expenses,
such as director’s fees, independent review committee fees, custodian fees, transfer agent fees, audit fees, filing
fees, legal fees, and other administrative expenses, in addition to the expenses that are attributable to a particular
class of shares. The common operating expenses are allocated on a proportionate basis to each class of shares
based on the net redemption value of each class to the total net redemption value of the Fund.

41. 39
4. Mortgages
The following is a summary of the mortgage portfolio as at December 31, 2008:
Interest in first mortgages 65% $ 25,585,092
Interest in non-first mortgages 35% 13,715,231
100% 39,300,323
As part of the assessment of fair value, management of the Fund routinely reviews each mortgage for impairment
to determine whether or not a loan should be recorded at its estimated realizable value.
As at December 31, 2008, management does not believe an impairment exists on any mortgages, as such, no
adjustment to the fair value of the mortgages has been recorded.
The mortgages are secured by the real property to which they relate, bear interest at a weighted average interest
rate of 11.61% and mature between 2009 and 2011.
The unadvanced mortgage commitments under the existing mortgage portfolio amounted to $120,624 as at
December 31, 2008.
Principal repayments based on contractual maturity dates are as follows:
2009 $ 20,850,323
2010 10,700,000
2011 7,750,000
39,300,323
A majority of the mortgages contain a prepayment option, whereby the borrower may repay the principal at any
time prior to maturity without penalty or yield maintenance.
Timbercreek Annual Report 2008

42. 5. Shareholders’ equity
The Fund is available in two classes of shares: Class A and Class B. All shares in a class rank equally with respect
to dividends. Each Class A and Class B shareholder is entitled to one vote for each share owned at all meetings
of shareholders at which the particular class of shares is entitled to attend and vote. During the period ended
December 31, 2008, Class A, Class B and Voting shares issued and outstanding changed as follows:
Shares Shares
outstanding — outstanding —
Authorized beginning of period Issued Exchanged Redeemed end of period
Class A unlimited – 3,436,666 452,896 – 3,889,562
Class B unlimited – 1,932,279 (430,000) – 1,502,279
Voting shares unlimited – 100 – – 100
On completion of the IPO on July 7, 2008, the Fund issued 2,433,186 Class A shares for net proceeds of
$22,688,015 and 1,509,279 Class B shares in exchange for net assets acquired less issuance costs of
$14,858,133.
In December 2008, the Fund issued 1,003,480 Class A shares for net proceeds of $9,124,219 and 423,000
Class B shares for net proceeds of $4,180,000.
Redemptions
Monthly redemptions
Subject to certain restrictions, a Class A share may be surrendered for redemption and transacted on the last
business day of any month. Shareholders whose Class A shares are surrendered for redemption in any month
(other than October) will be entitled to receive a price per Class A share equal to the lesser of (i) 95% of the trading
price, defined as the weighted average trading price on the Toronto Stock Exchange (TSX) for a period of ten
trading days immediately preceding the relevant redemption date (the Trading Price) or (ii) the market price, being
the closing price of the Class A shares on the TSX on the redemption date (the Market Price).
Class B shares are redeemable monthly on the same terms and conditions as the Class A shares equal to the
lesser of (i) 95% of the Trading Price of the Class A shares multiplied by the Class B exchange ratio; and (ii) the
Market Price multiplied by the Class B exchange ratio. The exchange ratio is defined as the net redemption value
per Class B share divided by the net redemption value per Class A share on the relevant exchange date.

43. 41
There is no market through which Class B shares may be sold. Subject to certain restrictions, holders of Class B
shares may exchange their shares for Class A shares on the last business day of each month.
Annual redemptions
Class A and Class B shares may be redeemed on the last business day of October of each year at a price per
share equal to the net redemption value per Class A share and Class B share, respectively.
Dividends
The Fund intends to pay dividends to shareholders on a monthly basis within 15 days following the end of
each month.
For the period ended December 31, 2008, the Fund declared dividends of $0.4425 per Class A share for a total
of $1,145,706 and $0.4811 per Class B share for a total of $689,897. As at December 31, 2008, $344,458 was
payable to the shareholders.
6. Due to related parties
As at December 31, 2008, $42,780 remains payable by the Fund to the Fund Manager for management fees.
In addition, $34,894 remains payable to the Mortgage Manager relating to performance fees earned for the period
ended December 31, 2008.
Timbercreek Annual Report 2008

44. 7. Reconciliation of net asset value
A reconciliation between the redemption net asset value (Redemption NAV) and net assets calculated using
Canadian GAAP (GAAP NAV) is as follows:
Redemption GAAP
NAV Adjustment NAV
Net asset value as at December 31, 2008
Class A $ 36,501,706 $ (669,657) $ 35,832,049
Class B $ 14,796,318 $ (118,794) $ 14,677,524
Redemption GAAP
NAV per share Adjustment NAV per share
Net asset value per share as at December 31, 2008
Class A $ 9.38 $ (0.17) $ 9.21
Class B $ 9.85 $ (0.08) $ 9.77
The GAAP NAV differs from the Redemption NAV calculated for fund pricing purposes. This adjustment is
due to including costs associated with the establishment, structuring and periodic offering of shares of the
Fund attributable to a specific class, being amortized monthly over a period of five years in determining the
Redemption NAV.
8. Capital risk management
The Fund manages its capital structure in order to support ongoing operations while focusing on its primary objec-
tives of preserving shareholder capital and generating a stable monthly cash dividend to shareholders. The Fund
defines its capital structure to include Class A and Class B shares.
The Fund reviews its capital structure on an ongoing basis and adjusts its capital structure in response to mort-
gage investment opportunities, the availability of capital, and anticipated changes in general economic conditions.
As at December 31, 2008, the Fund has no externally imposed capital requirements.