U.S. asset managers are increasingly using AI in their real estate investment decisions, particularly for portfolio management and market analysis predictions. However, in Canada, most managers still rely heavily on traditional factor models.

TD Asset Management Inc. (TDAM) is one of the few Canadian firms that has integrated AI in its real estate decision-making process. TDAM's 2025 Real Estate & Mortgage Investor Day in Vancouver offered a behind-the-scenes look at the sophisticated AI models the company has developed to optimize its real estate investment process.

1333 West Broadway, Vancouver

"Better Data" and "Better Technique"

TDAM's AI philosophy is based on three pillars: automating tasks, generating revenue and mitigating risk. The firm's approach to AI has two main aspects: "better data" and "better technique."

The "better data" aspect involves identifying and gathering hundreds and thousands of data points and then organizing them into a digestible format for use by sophisticated models.

It's impossible for a human to make any inference from these vast amounts of data just by looking at them or by applying a traditional regression or factor model, which has been the industry norm until now.

That's where the "better technique" aspect comes in. This aspect focuses on building sophisticated models that can synthesize the numerous data points in seconds. This allows the research team to correlate the multitude of data points to assist in predicting future market movements with great precision.

Armed with these real-time insights and predictions, the research team can make better decisions about the properties which have the best investment potential, as well as the sectors, locations and countries where these properties can be found.

1285 West Broadway, Vancouver

XGBoost Model

One of the key machine learning models TDAM has built is the gradient boosting model, specifically the XGBoost (Extreme Gradient Boosting), a predictive algorithm used for regression, classification and ranking problems.

The XGBoost is characterized by full data transparency, which allows the research team to deduce the logic from the inferences the model has gathered and to understand the rationale for each prediction.

The XGBoost helps identify properties with the greatest alpha and lowest risk, offering predictions over various year horizons. The model has shown a precision of about 86% over a 10-year period, according to TDAM's back-testing results.

These predictions are then ranked. This provides the research team with an additional lens to analyze things through, which either validates their assumptions or suggests an alternative. This explainability feature of the XGBoost algorithm allows for a quick, thorough analysis, giving TDAM a competitive edge.

1497 West Broadway – Broadway and Granville, Vancouver

Overview of Investment Strategies

The Real Estate & Mortgage Investor Day event also featured an economic update and a comprehensive look at real estate, mortgage and fixed income positioning relative to other asset classes.

The event provided a detailed overview of the TD Greystone Mortgage Fund, the TD Greystone Real Estate Fund Inc. and the TD Greystone Real Estate LP Fund , including strategy modernization updates and discussions about the incorporation of material Environmental, Social and Governance factors in those strategies.

Cross Roads, Vancouver

The first day of the event culminated in an exclusive tour of high-quality, transit-linked office and retail spaces in a mixed-use growing community in Vancouver. The places which attendees toured included the Crossroads property, the West Broadway Office Portfolio and the West Broadway and Granville Street development.

_{For Canadian institutional investment professionals only. Not for further distribution.} 

_{The information contained herein is for information purposes only. The information has been drawn from sources believed to be reliable. Graphs and charts are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax, accounting or investment advice. Particular investment, tax or trading strategies should be evaluated relative to each individual's objectives and risk tolerance.}

_{This material is not an offer to any person in any jurisdiction where unlawful or unauthorized. These materials have not been reviewed by and are not registered with any securities or other regulatory authority in jurisdictions where we operate.}

_{Any general discussion or opinions contained within these materials regarding securities, real assets or market conditions represent our view or the view of the source cited. Unless otherwise indicated, such view is as of the date noted and is subject to change. Information about the portfolio holdings, asset allocation or diversification is historical and is subject to change.}

_{Certain statements in this document may contain forward-looking statements (“FLS”) that are predictive in nature and may include words such as “expects”, “anticipates”, “intends”, “believes”, “estimates” and similar forward-looking expressions or negative versions thereof. FLS are based on current expectations and projections about future general economic, political and relevant market factors, such as interest and foreign exchange rates, equity and capital markets, the general business environment, assuming no changes to tax or other laws or government regulation or catastrophic events. Expectations and projections about future events are inherently subject to risks and uncertainties, which may be unforeseeable. Such expectations and projections may be incorrect in the future. FLS are not guarantees of future performance. Actual events could differ materially from those expressed or implied in any FLS. A number of important factors including those factors set out above can contribute to these digressions. Reliance on FLS should be avoided.}

_{No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment. Any characteristics, guidelines, constraints or other information provided for this material is representative of the investment strategy and is provided for illustrative purposes only. Any information about the holdings, asset allocation, or sector diversification is historical and is not an indication of future performance or any future portfolio composition, which will vary. Portfolio holdings are representative of the strategy, are subject to change at any time and are not a recommendation to buy or sell a security. The securities identified and described do not represent all of the securities purchased, sold or recommended for the portfolio. It should not be assumed that an investment in these securities or sectors was or will be profitable.}

_{If derivatives are employed, note that investing in derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments and, in a down market, could become harder to value or sell at a fair price.}

_{The investments, commodities, derivatives, and other financial instruments disclosed herein may or may not be current holdings or positions in any strategy. Any reference to a particular commodity, commodity derivative, company, issuer, market, contract, or financial instrument is provided for illustrative purposes only and does not constitute a recommendation to buy, sell, hold, or otherwise transact in any such investment.}

_{TD Asset Management represents TD Asset Management Inc. which operates in Canada and TD Asset Management (US), Inc. which operates in the U.S. Both entities are affiliates and wholly-owned subsidiaries of The Toronto-Dominion Bank.TD Asset Management products are also available through a network of affiliated and unaffiliated distributors.  Please contact our distribution partners to find out more.}

_{®The TD logo and other TD trademarks are the property of The Toronto-Dominion Bank or its subsidiaries.}