U.S. UNITHOLDERS PER UNIT SCHEDULE K1 FOR 2016

US Unitholder Tax Information

Per unit Schedule K‐1 for US unitholders for the year ended December 31, 2016

Since the January 3rd, 2013 real estate investment trust conversion where shareholders of Granite Real Estate Inc. became unitholders of the stapled units of Granite Real Estate Investment Trust (“Granite REIT”) and Granite REIT Inc., Granite REIT is considered to be a US partnership for US federal income tax purposes. As a result, US unitholders are required to include their allocable share of Granite REIT’s items of income and deductions in their individual income tax returns as reported in their respective individual Schedule K‐1.

Granite REIT does not have access to the beneficial ownership information for units held through the investment broker/dealer network, however, to assist US unitholders with the preparation of their US federal and state income tax returns, attached is a “per unit” Schedule K‐1 that can be used by US unitholders/partners in Granite REIT for the year ended December 31, 2016. US unitholders can use this “per unit” Schedule K‐1 and apply the per unit share of income and expenses multiplied by their actual number of units, pro-rated as applicable, for the time period during which their units were held in 2016, to determine their allocable share of Granite REIT’s items of income and deductions to be included in their US federal and state income tax returns.

Granite REIT also wants to clarify that, while each US unitholder will have received a Form 1099‐INT for the portion of the 2016 cash distributions that is interest paid from US sources, the amounts reported on this form are also included in the “per unit” Schedule K‐1. Accordingly, Granite REIT recommends that US unitholders only use the information calculated from the “per unit” Schedule K‐1 in their US federal and state income tax returns.

As is discussed in Granite REIT’s Annual Information Form dated March 1, 2017, a unitholder’s allocable share of partnership taxable income may differ from the cash distributions received from the partnership. The difference between taxable income and cash distributions received can be an adjustment in computing a unitholder’s tax basis in their stapled units. In 2016, unitholders will be required to report more taxable income than cash distributions received. As the taxable income was in excess of the cash distributions in 2016, a unitholder can add the excess to their tax basis in their stapled units.

Granite REIT recommends that unitholders consult with their tax advisors with respect to their US federal and state tax filing obligations.

U.S. Unitholders – per unit Schedule K-1 for 2016