2021 Q3 Report

Dream Impact Trust

Q3 Report 2021

Table of Contents

Management's Discussion and Analysis	1
Condensed Consolidated Financial Statements	32
Notes to the Condensed Consolidated Financial Statements	36

MANAGEMENT'S DISCUSSION AND ANALYSIS

(All dollar amounts in our tables are presented in thousands of Canadian dollars, except unit and per unit amounts, unless otherwise stated)

This Management's Discussion and Analysis ("MD&A") is dated as of, and reflects all material events up to, November 1, 2021, the date on which this MD&A was approved by the Board of Trustees.

When we refer to terms such as "we", "us" and "our", we are referring to the Trust, Dream Impact Master LP (formerly Dream Alternatives Master LP) ("MPCT LP") and its subsidiaries. When we refer to "unitholders" we are referring to holders of the units of the Trust.

1. OVERVIEW AND OVERALL FINANCIAL PERFORMANCE

1.1 OVERVIEW OF THE TRUST

Dream Impact Trust ("Dream Impact" or the "Trust") is an open-ended trust dedicated to impact investing. Impact investing is the intention of creating measurable positive, social and environmental change in our communities and for our stakeholders, while generating attractive market returns. The Trust's underlying portfolio is comprised of exceptional real estate assets reported under two operating segments: development and recurring income. The units of the Trust are listed on the Toronto Stock Exchange ("TSX") under the symbol "MPCT.UN".

The Trust is managed by Dream Asset Management Corporation ("DAM" or the "Asset Manager"), a subsidiary of Dream Unlimited Corp. ("Dream Unlimited" or "Dream") (TSX: DRM), which is one of Canada's leading real estate companies, with approximately $12 billion of assets under management in North America and Europe. On January 1, 2018, Dream acquired control of the Trust, for accounting purposes, based on Dream's increased exposure to variable returns resulting from increased ownership through units held in the Trust and from new real estate joint venture agreements. The ultimate controlling party of the Trust is Michael Cooper, President and Chief Responsible Officer of DAM and Dream. As of

September 30, 2021, Dream has a 27% ownership interest in Dream Impact.

1.2 OUR STRATEGY AND OPERATING SEGMENTS

Our fundamental objectives are to:

• Create positive and lasting impacts for our stakeholders through our three impact verticals: environmental sustainability and resilience, attainable and affordable housing, and inclusive communities;
• Balance growth and stability of the portfolio, increasing cash flow, unitholders' equity and net asset value ("NAV")(1) over time;
• Leverage our access to an experienced management team and strong partnerships in order to generate attractive returns for investors;
• Provide investors with a portfolio of high-quality real estate development opportunities, concentrated in core geographic markets; and
• Provide predictable cash distributions to unitholders on a tax-efficient basis.

As at September 30, 2021, our operating segments consisted of the following:

• Recurring income - comprised of a portfolio of office and commercial real estate income properties and multi-family residential assets in the Greater Toronto Area ("GTA") and Ottawa/Gatineau, and interest-paying mortgages and corporate loans; and
• Development - comprised of direct and indirect investments in residential and mixed-use developments, a hospitality asset, and participating mortgage receivables.

Recurring income is important to our business as it provides stable returns in order to fund our ongoing fixed operating costs, interest and distribution. As we build out our extensive development pipeline, we intend to hold high-quality assets for the long term, which will further contribute to our sources of recurring income. Over time, as we retain our best-in-class developed income properties, we expect approximately 70% of our portfolio to be comprised of this segment.

We believe the Trust's development segment represents a portfolio of high-quality assets located in core geographic markets. These assets represent the primary source of growth for the Trust, which we expect will generate future income and cash flows over time as the projects are developed. Assets may be built for sale or built to hold for the long term. Due to the nature of development, the Trust expects fluctuations in earnings from period to period from this segment. Typically,

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assets may be acquired and held for a number of years before development commences or contribution to net income is realized. However, depending on a variety of factors, including location, market conditions, density and asset class, the value of these projects may appreciate as we progress through the rezoning and pre-development process. Our development segment is expected to generate attractive returns and continued NAV(1) accretion over time.

Over 70% of our projects are zoned, with the remaining 30% of Dream Impact's development projects or assets with redevelopment potential currently in the rezoning process, based on NAV(1). Depending on the specific municipality, the zoning process may take upwards of 2-3 years from the timing of submission. Significant zoning approvals are expected over the next 2 years.

In accordance with the Trust's mandate to be a pure-play impact investment vehicle, assets in both operating segments will correspond to our impact verticals. These verticals are aligned with the widely recognized and accepted United Nations Sustainable Development Goals and are:

• Environmental sustainability and resilience - develop sustainable real estate that optimizes energy use, limits greenhouse gas ("GHG") emissions, and reduces water use and waste while also creating resiliency against natural disasters and major climatic events.
• Attainable and affordable housing - invest in mixed-income communities that are transit-oriented, located close to employment opportunities, and support an overall lower relative cost of living with high quality of life.
• Inclusive communities - intentionally design and program communities that are safe and inclusive for everyone. This includes creating spaces that encourage mental and physical health, and wellness.

As the owner and developer of our real estate, we are focused on developing and operating our properties to contribute to the betterment of our communities through managing our resource efficiency to minimize environmental harm to communities, incorporating attainable and affordable housing, and fostering inclusivity, as we pursue attractive market returns.

On May 3, 2021, the Trust released its inaugural impact report which outlines the framework and specific pathways on certain investments. The Trust intends to benchmark its performance, on an annual basis, against specific targets that will conform to principles set out by reputable third parties. Additionally, the Trust has identified three main features of its approach to impact management:

• Intentionality - for each of the portfolio properties that qualify as impact assets, the Trust specifies impact pathways that set out the positive impacts expected to be achieved;
• Measurement - each impact pathway will be scored according to various dimensions. These dimensions will include who will be affected (an assessment of the number of people, and how well or underserved they are), the extent of the impact (an assessment of duration and degree), and what the Trust's contribution is (an assessment of the outcome delivered by the Trust, relative to what would have happened otherwise). We intend to measure our impact efforts in a repeatable, systematic way; and
• Verification - our process surrounding our impact goals and impact management system will be verified by a recognized independent firm at regular intervals.

During the nine months ended September 30, 2021, the Dream Impact Management System was verified by an independent third-party. The verifying firm evaluated the extent to which the Impact Management System and impact investing activities to date align with the Operating Principles for Impact Management ("Impact Principles"). The results of the verification were in line with our expectations and industry averages. The Trust intends to incorporate feedback from the verification process to improve the alignment with each Impact Principle over the next three years.

As at September 30, 2021, approximately 80% of NAV(1) qualified under the Trust's definition of an impact investment. Over the next few years, our strategy is to deploy our balance sheet into new impact investment opportunities, wind-down or exit remaining non-impact investments and redeploy proceeds, and increase our financial flexibility from our build-to-sell assets.

1. Represents a non-IFRS measure. For the Trust's definition of the following non-IFRS measures: market value, NAV, please refer to the Non-IFRS Measures and Other Disclosures section of this MD&A. Non-IFRS measures do not have standardized meanings prescribed by IFRS ("International Financial Reporting Standards") and may not be comparable with similar measures presented by other issuers.

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1.3 FINANCIAL OVERVIEW - THIRD QUARTER 2021

KEY ACHIEVEMENTS

During the three and nine months ended September 30, 2021, ground-breaking took place at Canary Block 10, a multi-use development that will house the first purpose-built Indigenous Hub in North America, a 206-unit condominium and a 237- unit rental building in which the Trust has a 25% ownership interest. Subsequent to September 30, 2021, Canary Block 10 secured a $90.0 million green loan ($22.5 million at the Trust's share). The proceeds of the loan will be applied towards achieving certain sustainability initiatives including LEED Gold-level certification.

During the three and nine months ended September 30, 2021, fair value gains of $1.3 million and $4.8 million, respectively (at the Trust's share), were recognized within various blocks at the Zibi development and reflected in net income from equity accounted investments, as certain buildings near completion and achieve development and leasing milestones. This includes Aalto Suites, Zibi's 162-unit,15-storey residential rental building, which commenced leasing subsequent to the quarter, and the Natural Sciences Building, a 186,000 sf commercial building leased to the Federal Government of Canada. The Trust expects that approximately 25% of available rental units at Aalto Suites will be ready for occupancy by the end of the year with the remaining units by Spring 2022. The building represents the Trust's first affordable purpose-built rental at Zibi, in which over 95% of units will be affordable, in line with our impact verticals. To date, the Trust has invested $88.5 million in the Zibi development, including transaction costs, and holds a 50% interest.

Over the next 12 months, the Zibi development will have three blocks completed, including Aalto Suites, the Natural Sciences Building and Block 208, a 33,000 sf commercial building that is approximately 80% leased. This is in addition to 15 Rue Jos- Montferrand, which had first tenant occupancy earlier this year. These buildings combined will add 273,000 sf of commercial gross leasable area ("GLA") and 162 multi-family residential units to the Trust's recurring income segment by the end of 2022.

Subsequent to the three months ended September 30, 2021, the Trust acquired a 40% interest in 34 Madison, an 8,000 sf commercial building in the Annex neighbourhood of downtown Toronto, for $1.4 million, including transaction costs, at the Trust's share. This is the Trust's first investment with the Black Tusk Group, a real estate asset management firm that is minority founded and led.

Refer to Section 1.4, "Summary of Portfolio Assets" in this MD&A for details on our complete development pipeline, and Section 10.1, "Summary of Impact Investments" for details on certain of our impact investments.

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