PRIVATE EQUITY  Our private equity operations are conducted through a series of institutional private equity funds operated under the Brookfield  Capital Partners brand with total committed capital of $3.1 billion as well as direct investments in several public companies  including Norbord Inc. (“Norbord”) and Western Forest Products Inc. (“Western Forest Products”).  FFO increased to $612 million during 2013 from $227 million in 2012, reflecting a large increase in realized disposition gains as  well as improved FFO at investee companies. FFO excluding realized disposition gains increased by $84 million to $296 million  compared to 2012, reflecting improved pricing and volumes primarily due to the ongoing recovery in the U.S. housing market,  particularly at our two panelboard investments.  The following table disaggregates segment FFO and segment equity into the amounts attributable to the capital we have invested  in the private funds that we manage, our investment in Norbord, other investments and realized disposition gains to facilitate  analysis: AS AT AND FOR THE YEARS ENDED DECEMBER 31  (MILLIONS) Funds from Operations Common Equity  by Segment 2013 2012 2013 2012 Brookfield Capital Partners Private funds  $ 66 $ 59 $ 474 $ 198 Norbord  120 77 246 217 Other  110 76 385 542 Realized disposition gains  316 15 — — $ 612 $ 227 $ 1,105 $ 957 The private equity fund portfolios include 12 investments in a diverse range of industries. Our average investment is $41 million  and our largest single exposure is $114 million using IFRS values or $211 million based on stock market prices. We concentrate  our investing activities on businesses with tangible assets and cash flow streams in order to better protect our capital.  Our largest direct investment is a 52% interest in Norbord, which is one of the world’s largest producers of oriented strand board.  The market value of our investment in Norbord at December 31, 2013 was approximately $890 million based on stock market  prices, compared to our carrying value of $246 million. Increased prices and volumes within our panelboard businesses, which are benefitting from the U.S. housing recovery, led to a  $98 million increase in FFO from our various industrial and forest products businesses to $221 million.  Realized disposition gains include the sale of pulp and paper business, which was held in our private funds, achieving a 70%  IRR and a 10x multiple on capital. The fund recognized a $507 million realization gain, of which our proportionate share was  $200 million. In addition, we partially monetized our investments in Western Forest Products and Norbord during the year,  recognizing a gain of $47 million on the sale of 117.1 million shares of Western Forest Products, as well as a gain of $73 million  on the sale of 8.1 million shares of Norbord. Segment common equity increased by $148 million over the prior year, as capital invested in our private funds and direct  investments in our energy and related services operations, more than offset the impact of asset sales within our industrial and  forest products. RESIDENTIAL DEVELOPMENT Our residential development operations consist of our direct investment in two public companies: Brookfield Residential  Properties Inc. (“BRPI”) and Brookfield Incorporações S.A. (“BISA”), as well as operations in Australia that we are in the  process of winding down.  Our North American business is conducted through BRPI. We hold approximately 69% of BRPI, which is listed on the New York  and Toronto stock exchanges. BRPI is active in 11 principal markets located primarily in Canada, and the U.S., and controls over  110,000 lots in these markets. Our major focus is on entitling and developing land for building homes or for the sale of lots to  other builders. Our Brazilian business is conducted through BISA. We hold approximately 45% of BISA which is listed on the principal  stock exchange in Brazil. BISA is one of the leading developers in Brazil’s real estate industry. These operations include land  acquisition and development, construction, and sales and marketing of a broad range of “for sale” residential and commercial  office units, with a primary focus on middle income residential. The operations are conducted in Brazil’s main metropolitan  areas, including São Paulo, Rio de Janeiro, the Brasilia Federal District, and the five other markets that collectively account for  the majority of the Brazilian real estate market.  Our residential businesses are carried primarily at historical cost, or the lower of cost and market, notwithstanding the length of  time that some of our assets have been held and the value created through the development process.  2013 ANNUAL REPORT 47