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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 2003
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OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
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Commission file number 1-10899
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Kimco Realty Corporation
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(Exact name of registrant as specified in its charter)
Maryland 13-2744380
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(State of incorporation) (I.R.S. Employer Identification No.)
3333 New Hyde Park Road, New Hyde Park, NY 11042-0020
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(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code (516) 869-9000 Securities
registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
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Common Stock, par value $.01 per share. New York Stock Exchange
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Depositary Shares, each representing one-
tenth of a share of 6.65% Class F
Cumulative Redeemable Preferred Stock,
par value $1.00 per share. New York Stock Exchange
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Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark whether the Registrant (i) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (ii) has been subject to such
filing requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. X
Indicate by check mark whether the Registrant is an accelerated
filer (as defined in rule 12b-2 of the Act.) Yes X No
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The aggregate market value of the voting stock held by
non-affiliates of the Registrant was approximately $4.4 billion based upon the
closing price on the New York Stock Exchange for such stock on January 30, 2004.
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the
Registrant's classes of common stock, as of the latest practicable date.
110,745,713 shares as of January 30, 2004.
1
DOCUMENTS INCORPORATED BY REFERENCE
Part III incorporates certain information by reference to the Registrant's
definitive proxy statement to be filed with respect to the Annual Meeting of
Stockholders expected to be held on May 20, 2004.
Index to Exhibits begins on page 49.
2
TABLE OF CONTENTS
Form
10-K
Report
Item No. Page
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PART I
1. Business . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2. Properties . . . . . . . . . . . . . . . . . . . . . . . . . 17
3. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . 19
4. Submission of Matters to a Vote of Security Holders . . . . 19
Executive Officers of the Registrant . . . . . . . . . . . . 28
PART II
5. Market for the Registrant's Common Equity
and Related Shareholder Matters . . . . . . . . . . . . . 30
6. Selected Financial Data . . . . . . . . . . . . . . . . . . 31
7. Management's Discussion and Analysis of Financial Condition and
Results of Operations. . . . . . . . . . . . . . . . . . . 33
7A. Quantitative and Qualitative Disclosures About Market Risk . 45
8. Financial Statements and Supplementary Data . . . . . . . . 46
9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure . . . . . . . . . . . . . . . . . 46
9A. Controls and Procedures . . . . . . . . . . . . . . . . . . 46
PART III
10. Directors and Executive Officers of the Registrant . . . . . 47
11. Executive Compensation . . . . . . . . . . . . . . . . . . . 47
12. Security Ownership of Certain Beneficial Owners and
Management . . . . . . . . . . . . . . . . . . . . . . . . 47
13. Certain Relationships and Related Transactions . . . . . . . 47
14. Principal Accountant Fees and Services . . . . . . . . . . . 47
PART IV
15. Exhibits, Financial Statements, Schedules and Reports on
Form 8-K . . . . . . . . . . . . . . . . . . . . . . . . . 48
3
PART I
FORWARD-LOOKING STATEMENTS
This annual report on Form 10-K, together with other statements and information
publicly disseminated by Kimco Realty Corporation (the "Company" or "Kimco")
contains certain forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. The Company intends such forward-looking
statements to be covered by the safe harbor provisions for forward-looking
statements contained in the Private Securities Litigation Reform Act of 1995 and
include this statement for purposes of complying with these safe harbor
provisions. Forward-looking statements, which are based on certain assumptions
and describe the Company's future plans, strategies and expectations, are
generally identifiable by use of the words "believe," "expect," "intend,"
"anticipate," "estimate," "project" or similar expressions. You should not rely
on forward-looking statements since they involve known and unknown risks,
uncertainties and other factors which are, in some cases, beyond the Company's
control and which could materially affect actual results, performances or
achievements. Factors which may cause actual results to differ materially from
current expectations include, but are not limited to, (i) general economic and
local real estate conditions, (ii) the inability of major tenants to continue
paying their rent obligations due to bankruptcy, insolvency or general downturn
in their business, (iii) financing risks, such as the inability to obtain equity
or debt financing on favorable terms, (iv) changes in governmental laws and
regulations, (v) the level and volatility of interest rates (vi) the
availability of suitable acquisition opportunities and (vii) increases in
operating costs. Accordingly, there is no assurance that the Company's
expectations will be realized.
Item 1. Business
General Kimco Realty Corporation, a Maryland corporation, is one of the
nation's largest owners and operators of neighborhood and community shopping
centers. The Company is a self-administered real estate investment trust
("REIT") and manages its properties through present management, which has owned
and operated neighborhood and community shopping centers for over 40 years. The
Company has not engaged, nor does it expect to retain, any REIT advisors in
connection with the operation of its properties. As of February 5, 2004, the
Company's portfolio was comprised of 699 property interests including 620
neighborhood and community shopping center properties (including 26 property
interests related to the Company's Preferred Equity program), 36 retail store
leases, 33 ground-up development projects and ten parcels of undeveloped land
totaling approximately 102.6 million square feet of leasable space (including
3.9 million square feet related to the Company's Preferred Equity program and
4.9 million square feet projected for the ground-up development projects)
located in 41 states, Canada and Mexico. The Company's ownership interests in
real estate consist of its consolidated portfolio and in portfolios where the
Company owns an economic interest, such as; Kimco Income REIT ("KIR"), the
RioCan Venture ("RioCan Venture"), Kimco Retail Opportunity Portfolio ("KROP")
and other properties or portfolios where the Company also retains management
(See Recent Developments - Operating Real Estate Joint Venture Investments and
Note 8 of the Notes to Consolidated Financial Statements included in this annual
report on Form 10-K). The Company believes its portfolio of neighborhood and
community shopping center properties is the largest (measured by gross leasable
area ("GLA")) currently held by any publicly-traded REIT.
The Company's executive offices are located at 3333 New Hyde Park Road, New Hyde
Park, New York 11042-0020 and its telephone number is (516) 869-9000. Unless the
context indicates otherwise, the term the "Company" as used herein is intended
to include subsidiaries of the Company.
The Company's web site is located at http://www.Kimcorealty.com. On the
Company's web site you can obtain, free of charge, a copy of our annual report
on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and
amendments to those reports filed or furnished pursuant to Section 13(a) or
15(d) of the Exchange Act of 1934, as amended, as soon as reasonably practicable
after we file such material electronically with, or furnish it to, the
Securities and Exchange Commission (the "SEC").
History The Company began operations through its predecessor, The Kimco
Corporation, which was organized in 1966 upon the contribution of several
shopping center properties owned by its principal stockholders. In 1973, these
principals formed the Company as a Delaware corporation, and in 1985, the
operations of The Kimco Corporation were merged into the Company. The Company
completed its initial public stock offering (the "IPO") in November 1991, and
commencing with its taxable year which began January 1, 1992, elected to qualify
as a REIT in accordance with Sections 856 through 860 of the Internal Revenue
Code of 1986, as amended (the "Code"). In 1994, the Company reorganized as a
Maryland corporation.
4
The Company's growth through its first 15 years resulted primarily from the
ground-up development and construction of its shopping centers. By 1981, the
Company had assembled a portfolio of 77 properties that provided an established
source of income and positioned the Company for an expansion of its asset base.
At that time, the Company revised its growth strategy to focus on the
acquisition of existing shopping centers and creating value through the
redevelopment and re-tenanting of those properties. As a result of this
strategy, substantially all of the operating shopping centers added to the
Company's portfolio since 1981 have been through the acquisition of existing
shopping centers.
During 1998, the Company, through a merger transaction, completed the
acquisition of The Price REIT, Inc., a Maryland corporation, (the "Price REIT").
Prior to the merger, Price REIT was a self-administered and self-managed equity
REIT that was primarily focused on the acquisition, development, management and
redevelopment of large retail community shopping center properties concentrated
in the western part of the United States. In connection with the merger, the
Company acquired interests in 43 properties, located in 17 states. With the
completion of the Price REIT merger, the Company expanded its presence in
certain western states including California, Arizona and Washington. In
addition, Price REIT had strong ground-up development capabilities. These
development capabilities, coupled with the Company's own construction management
expertise, provides the Company, on a selective basis, the ability to pursue
ground-up development opportunities.
Also, during 1998, the Company formed KIR, an entity in which the Company held a
99.99% limited partnership interest. KIR was established for the purpose of
investing in high quality properties financed primarily with individual
non-recourse mortgages. The Company believes that these properties are
appropriate for financing with greater leverage than the Company traditionally
uses. At the time of formation, the Company contributed 19 properties to KIR,
each encumbered by an individual non-recourse mortgage. During 1999, KIR sold a
significant interest in the partnership to institutional investors. As of
December 31, 2003, the Company holds a 43.3% non-controlling limited partnership
interest in KIR and accounts for its investment in KIR under the equity method
of accounting. (See Recent Developments - Operating Real Estate Joint Venture
Investments and Note 8 of the Notes to Consolidated Financial Statements
included in this annual report on Form 10-K.)
In connection with the Tax Relief Extension Act of 1999 (the "RMA") which became
effective January 1, 2001, the Company is now permitted to participate in
activities which it was precluded from previously in order to maintain its
qualification as a REIT, so long as these activities are conducted in entities
which elect to be treated as taxable subsidiaries under the Code, subject to
certain limitations. As such, the Company, through its taxable REIT
subsidiaries, is engaged in various retail real estate related opportunities,
including (i) merchant building through its wholly-owned taxable REIT
subsidiary, Kimco Developers, Inc. ("KDI"), which is primarily engaged in the
ground-up development of neighborhood and community shopping centers and
subsequent sale thereof upon completion (see Recent Developments - Kimco
Developers, Inc. ("KDI")), (ii) retail real estate advisory and disposition
services which primarily focus on leasing and disposition strategies for real
estate property interests of both healthy and distressed retailers and (iii)
acting as an agent or principal in connection with tax deferred exchange
transactions. The Company will consider other investments through taxable REIT
subsidiaries should suitable opportunities arise.
During October 2001, the Company continued its geographical expansion by forming
the RioCan Venture with RioCan Real Estate Investment Trust ("RioCan", Canada's
largest publicly traded REIT measured by GLA) in which the Company has a
non-controlling 50% interest, to acquire retail properties and development
projects in Canada. The Company accounts for this investment under the equity
method of accounting (see Recent Developments - Operating Real Estate Joint
Venture Investments and Note 8 of the Notes to Consolidated Financial Statements
included in this annual report on Form 10-K.)
In addition, the Company continues to capitalize on its established expertise in
retail real estate by establishing other ventures in which the Company owns a
smaller equity interest and provides management, leasing and operational support
for those properties. The Company also provides preferred equity capital for
real estate entrepreneurs and provides real estate capital and advisory services
to both healthy and distressed retailers. The Company also makes selective
investments in secondary market opportunities where a security or other
investment is, in management's judgment, priced below the value of the
underlying real estate.
5
Investment and Operating Strategy The Company's investment objective has been
to increase cash flow, current income and, consequently, the value of its
existing portfolio of properties, and to seek continued growth through (i) the
strategic re-tenanting, renovation and expansion of its existing centers and
(ii) the selective acquisition of established income-producing real estate
properties and properties requiring significant re-tenanting and redevelopment,
primarily in neighborhood and community shopping centers in geographic regions
in which the Company presently operates. The Company will consider investments
in other real estate sectors and in geographic markets where it does not
presently operate should suitable opportunities arise.
The Company's neighborhood and community shopping center properties are designed
to attract local area customers and typically are anchored by a discount
department store, a supermarket or drugstore tenant offering day-to-day
necessities rather than high-priced luxury items. The Company may either
purchase or lease income-producing properties in the future, and may also
participate with other entities in property ownership through partnerships,
joint ventures or similar types of co-ownership. Equity investments may be
subject to existing mortgage financing and/or other indebtedness. Financing or
other indebtedness may be incurred simultaneously or subsequently in connection
with such investments. Any such financing or indebtedness will have priority
over the Company's equity interest in such property. The Company may make loans
to joint ventures in which it may or may not participate in the future.
In addition to property or equity ownership, the Company provides property
management services for fees relating to the management, leasing, operation,
supervision and maintenance of real estate properties.
While the Company has historically held its properties for long-term investment,
and accordingly has placed strong emphasis on its ongoing program of regular
maintenance, periodic renovation and capital improvement, it is possible that
properties in the portfolio may be sold, in whole or in part, as circumstances
warrant, subject to REIT qualification rules.
The Company seeks to reduce its operating and leasing risks through
diversification achieved by the geographic distribution of its properties and a
large tenant base. At December 31, 2003, the Company's single largest
neighborhood and community shopping center, accounted for only 1.0% of the
Company's annualized base rental revenues and only 0.6% of the Company's total
shopping center GLA. At December 31, 2003, the Company's five largest tenants
were The Home Depot, Kmart Corporation, Kohl's, Royal Ahold and TJX Companies,
which represent approximately 3.0%, 2.9%, 2.8%, 2.6% and 2.5%, respectively, of
the Company's annualized base rental revenues, including the proportionate share
of base rental revenues from properties in which the Company has less than a
100% economic interest.
In connection with the RMA, which became effective January 1, 2001, the Company
has expanded its investment and operating strategy to include new retail real
estate related opportunities which the Company was precluded from previously in
order to maintain its qualification as a REIT. As such, the Company, has
established a merchant building business through its KDI subsidiary. KDI makes
selective acquisitions of land parcels for the ground-up development of
neighborhood and community shopping centers and subsequent sale thereof upon
completion. Additionally, the Company has developed a retail property solutions
business which specializes in real estate advisory and disposition services of
real estate controlled by both healthy and distressed and/or bankrupt retailers.
These services may include assistance with inventory and fixture liquidation in
connection with going-out-of-business sales. The Company may participate with
other entities in providing these advisory services through partnerships, joint
ventures or other co-ownership arrangements. The Company, as a regular part of
its investment strategy, will continue to actively seek investments for its
taxable REIT subsidiaries.
The Company emphasizes equity real estate investments including preferred equity
investments, but may, at its discretion, invest in mortgages, other real estate
interests and other investments. The mortgages in which the Company may invest
may be either first mortgages, junior mortgages or other mortgage-related
securities. The Company provides mortgage financing to retailers with
significant real estate assets, in the form of lease- hold interests or fee
owned properties, where the Company believes the underlying value of the real
estate collateral is in excess of its loan balance. In addition, the Company
will acquire debt instruments at a discount in the secondary market where the
Company believes the real estate value of the enterprise is substantially
greater than the current value.
The Company may legally invest in the securities of other issuers, for the
purpose, among others, of exercising control over such entities, subject to the
gross income and asset tests necessary for REIT qualification. The Company may,
on a selective basis, acquire all or substantially all securities or assets of
other REITs or similar entities where such investments would be consistent with
the Company's investment policies. In any event, the Company does not intend
that its investments in securities will require it to register as an "investment
company" under the Investment Company Act of 1940.
6
The Company has authority to offer shares of capital stock or other senior
securities in exchange for property and to repurchase or otherwise reacquire its
common stock or any other securities and may engage in such activities in the
future. At all times, the Company intends to make investments in such a manner
as to be consistent with the requirements of the Code, to qualify as a REIT
unless, because of circumstances or changes in the Code (or in Treasury
Regulations), the Board of Directors determines that it is no longer in the best
interests of the Company to qualify as a REIT.
The Company's policies with respect to the aforementioned activities may be
reviewed and modified from time to time by the Company's Board of Directors
without the vote of the Company's stockholders.
Capital Strategy and Resources The Company intends to operate with and
maintain a conservative capital structure with a level of debt to total market
capitalization of approximately 50% or less. As of December 31, 2003, the
Company's level of debt to total market capitalization was 30%. In addition, the
Company intends to maintain strong debt service coverage and fixed charge
coverage ratios as part of its commitment to maintaining its investment-grade
debt ratings.
Since the completion of the Company's IPO in 1991, the Company has utilized the
public debt and equity markets as its principal source of capital for its
expansion needs. Since the IPO, the Company has completed additional offerings
of its public unsecured debt and equity, raising in the aggregate over $3.3
billion for the purposes of, among other things, repaying indebtedness,
acquiring interests in neighborhood and community shopping centers, funding
ground-up development projects, expanding and improving properties in the
portfolio and other investments.
During June 2003, the Company established a $500.0 million unsecured revolving
credit facility, which is scheduled to expire in August 2006. This credit
facility, which replaced the Company's $250.0 million unsecured revolving credit
facility, has made available funds to both finance the purchase of properties
and other investments and meet any short-term working capital requirements. As
of December 31, 2003, there was $45.0 million outstanding under this unsecured
revolving credit facility.
The Company also established a $400.0 million unsecured bridge facility, which
is scheduled to expire in September 2004, with an option to extend up to $150.0
million for an additional year. Proceeds from this facility were used to
partially fund the Mid-Atlantic Realty Trust transaction (see Recent
Developments - Mid-Atlantic Realty Trust Merger and Notes 3 and 13 of the Notes
to Consolidated Financial Statements included in this annual report on Form
10-K). As of December 31, 2003, there was $329.0 million outstanding on this
unsecured bridge facility.
The Company has a $300.0 million medium-term notes program (the "MTN program")
pursuant to which it may from time to time offer for sale its senior unsecured
debt for any general corporate purposes, including (i) funding specific
liquidity requirements in its business, including property acquisitions,
development and redevelopment costs, and (ii) managing the Company's debt
maturities. (See Note 13 of the Notes to Consolidated Financial Statements
included in this annual report on Form 10-K.)
In addition to the public debt and equity markets as capital sources, the
Company may, from time to time, obtain mortgage financing on selected properties
and construction loans to partially fund the capital needs of KDI, the Company's
merchant building subsidiary. As of December 31, 2003, the Company had over 400
unencumbered property interests in its portfolio representing over 88% of the
Company's net operating income.
It is management's intention that the Company continually have access to the
capital resources necessary to expand and develop its business. Accordingly, the
Company may seek to obtain funds through additional equity offerings, unsecured
debt financings and/or mortgage financings and other capital alternatives in a
manner consistent with its intention to operate with a conservative debt
capitalization policy.
During May 2003, the Company filed a shelf registration on Form S-3 for up to
$1.0 billion of debt securities, preferred stock, depositary shares, common
stock and common stock warrants. As of January 30, 2004, the Company had
approximately $609.7 million available for issuance under this shelf
registration statement.
7
The Company anticipates that cash flows from operations will continue to provide
adequate capital to fund its operating and administrative expenses, regular debt
service obligations and the payment of dividends in accordance with REIT
requirements in both the short-term and long-term. In addition, the Company
anticipates that cash on hand, free cash flow generated by the operating
business, availability under its revolving credit facility, issuance of equity
and public debt, as well as other debt and equity alternatives, will provide the
necessary capital required by the Company. Cash flow from operations was $308.6
million for the year ended December 31, 2003, as compared to $278.9 million for
the year ended December 31, 2002.
Competition As one of the original participants in the growth of the shopping
center industry and one of the nation's largest owners and operators of
neighborhood and community shopping centers, the Company has established close
relationships with a large number of major national and regional retailers and
maintains a broad network of industry contacts. Management is associated with
and/or actively participates in many shopping center and REIT industry
organizations. Notwithstanding these relationships, there are numerous regional
and local commercial developers, real estate companies, financial institutions
and other investors who compete with the Company for the acquisition of
properties and other investment opportunities and in seeking tenants who will
lease space in the Company's properties.
Inflation and Other Business Issues Many of the Company's leases contain
provisions designed to mitigate the adverse impact of inflation. Such provisions
include clauses enabling the Company to receive payment of additional rent
calculated as a percentage of tenants' gross sales above predetermined
thresholds ("Percentage Rents"), which generally increase as prices rise, and/or
escalation clauses, which generally increase rental rates during the terms of
the leases. Such escalation clauses include increases in the consumer price
index or similar inflation indices. In addition, many of the Company's leases
are for terms of less than 10 years, which permits the Company to seek to
increase rents upon renewal to market rates. Most of the Company's leases
require the tenant to reimburse the Company for their allocable share of
operating expenses, including common area maintenance costs, real estate taxes
and insurance, thereby reducing the Company's exposure to increases in costs and
operating expenses resulting from inflation. The Company periodically evaluates
its exposure to short-term interest rates and fluctuations in foreign currency
exchange rates and will, from time to time, enter into interest rate protection
agreements and foreign currency hedge agreements which mitigate, but do not
eliminate, the effect of changes in interest rates on its floating-rate debt and
changes in foreign currency exchange rates.
Risk Factors Set forth below are the material risks associated with the
purchase and ownership of the securities of the Company. As an owner of real
estate, the Company is subject to certain business risks arising in connection
with the underlying real estate, including, among other factors, (i) defaults of
major tenants due to bankruptcy, insolvency and/or general downturn in their
business which could reduce the Company's cash flow, (ii) major tenants not
renewing their leases as they expire or renewing at lower rental rates which
could reduce the Company's cash flow, (iii) changes in retailing trends which
could reduce the need for shopping centers, (iv) potential liability for future
or unknown environmental issues, (v) changes in real estate and zoning laws and
competition from other real estate owners which could make it difficult to lease
or develop properties, and (vi) the inability to acquire capital, either in the
form of debt or equity, on satisfactory terms to fund the Company's cash
requirements. The success of the Company also depends upon trends in the
economy, including, but not limited to, interest rates, income tax laws,
governmental regulations and legislation and population trends. Additionally,
the Company is subject to complex regulations related to its status as a REIT
and would be adversely affected if it failed to maintain its qualification as a
REIT.
Operating Practices Nearly all operating functions, including leasing, legal,
construction, data processing, maintenance, finance and accounting, are
administered by the Company from its executive offices in New Hyde Park, New
York. The Company believes it is critical to have a management presence in its
principal areas of operation and accordingly, the Company maintains regional
offices in various cities throughout the United States. A total of 405 persons
are employed at the Company's executive and regional offices.
The Company's regional offices are generally staffed by a manager and the
support personnel necessary to both function as local representatives for
leasing and promotional purposes and to complement the corporate office efforts
to ensure that property inspection and maintenance objectives are achieved. The
regional offices are important in reducing the time necessary to respond to the
needs of the Company's tenants. Leasing and maintenance personnel from the
corporate office also conduct regular inspections of each shopping center.
8
The Company also employs a total of 18 persons at several of its larger
properties in order to more effectively administer its maintenance and security
responsibilities.
Management Information Systems Virtually all operating activities are
supported by a sophisticated computer software system designed to provide
management with operating data necessary to make informed business decisions on
a timely basis. These systems are continually expanded and enhanced by the
Company and reflect a commitment to quality management and tenant relations. The
Company has integrated an advanced mid-range computer with personal computer
technology, creating a management information system that facilitates the
development of property cash flow budgets, forecasts and related management
information.
Qualification as a REIT The Company has elected, commencing with its taxable
year which began January 1, 1992, to qualify as a REIT under the Code. If, as
the Company believes, it is organized and operates in such a manner so as to
qualify and remain qualified as a REIT under the Code, the Company generally
will not be subject to federal income tax, provided that distributions to its
stockholders equal at least the amount of its REIT taxable income as defined
under the Code.
In connection with the RMA, which became effective January 1, 2001, the Company
is now permitted to participate in activities which the Company was precluded
from previously in order to maintain its qualification as a REIT, so long as
these activities are conducted in entities which elect to be treated as taxable
subsidiaries under the Code, subject to certain limitations. The primary
activities conducted by the Company in its taxable REIT subsidiaries during 2003
include, but are not limited to, (i) the ground-up development of shopping
center properties and subsequent sale thereof upon completion (see Recent
Developments - Kimco Developers, Inc. ("KDI")), (ii) real estate advisory and
disposition services provided in connection with asset designation rights, and
(iii) acting as an agent or principal in connection with tax deferred exchange
transactions. As such, the Company was subject to federal and state income taxes
on the income from these activities.
Recent Developments
Mid-Atlantic Realty Trust Merger -
During June 2003, the Company and Mid-Atlantic Realty Trust ("Mid-Atlantic")
entered into a definitive merger agreement (the "Merger Agreement") whereby
Mid-Atlantic would merge with and into a wholly-owned subsidiary of the Company
(the "Merger" or "Mid-Atlantic Merger"). The Merger required the approval of
holders of 66 2/3% of Mid-Atlantic's outstanding shares. Subject to certain
conditions, limited partners in Mid-Atlantic's operating partnership were
offered the same cash consideration for each outstanding unit and offered the
opportunity (in lieu of cash) to exchange their interests for preferred units in
the operating partnership upon the closing of the transaction.
The shareholders of Mid-Atlantic approved the Merger on September 30, 2003 and
the closing occurred October 1, 2003. Mid-Atlantic shareholders received cash
consideration of $21.051 per share. In addition, more than 99.0% of the limited
partners in Mid-Atlantic's operating partnership elected to have their
partnership units redeemed for cash consideration equal to $21.051 per unit.
The transaction had a total value of approximately $700.0 million including the
assumption of approximately $216.0 million of debt. The Company funded the
transaction with available cash, a new $400.0 million bridge facility and funds
from its existing revolving credit facility.
In connection with the Merger, the Company acquired interests in 41 operating
shopping centers, one regional mall, two shopping centers under development and
eight other commercial assets. The properties have a gross leasable area of
approximately 5.7 million square feet of which approximately 95.0% of the
stabilized square footage is currently leased. The Company also acquired
approximately 80.0 acres of undeveloped land. The properties are located
primarily in Maryland, Virginia, New York, Pennsylvania, Massachusetts and
Delaware. The Company has tentative agreements for a number of the properties to
be allocated to its strategic co-investment programs. For financial reporting
purposes the Merger was accounted for under the purchase method of accounting in
accordance with Statement of Financial Accounting Standards No. 141, Business
Combinations, ("SFAS No. 141").
During December 2003, the Company disposed of the one regional mall and the
adjacent annex acquired in the Merger located in Bel Air, MD for a sales price
of approximately $71.0 million, which approximated its net book value.
9
Operating Properties -
Acquisitions -
During the year ended December 31, 2003, the Company acquired 14 operating
properties located in eight states and Mexico, comprising approximately 1.7
million square feet of GLA for an aggregate purchase price of approximately
$293.9 million. Details of these transactions are as follows:
During January 2003, the Company acquired a property located in Houston, TX,
comprising approximately 0.2 million square feet of GLA, for a purchase price of
approximately $26.3 million. During June 2003, the Company transferred this
property to KROP.
During February 2003, the Company acquired a property located in Nashau, NH,
comprising approximately 0.2 million square feet of GLA, for a purchase price of
approximately $25.7 million.
During March 2003, the Company acquired four operating properties located in
Queens, NY, comprising approximately 0.1 million square feet of GLA, for an
aggregate purchase price of approximately $19.9 million.
During April 2003, the Company acquired a property located in Sterling, VA,
comprising approximately 0.4 million square feet of GLA, for a purchase price of
approximately $58.7 million. During September 2003, the Company transferred this
property to KROP.
During June 2003, the Company acquired a 66.7% controlling interest in a
property located in New Braunfels, TX, comprising approximately 0.1 million
square feet of GLA, for a purchase price of approximately $4.2 million.
Additionally, during June 2003, the Company acquired a property located in
Colma, CA, comprising approximately 0.2 million square feet of GLA, for a
purchase price of approximately $59.2 million. During November 2003, the Company
transferred this property to KROP.
Also, during June 2003, the Company acquired a property located in Greenwood,
CO, comprising approximately 0.2 million square feet of GLA, for a purchase
price of approximately $29.7 million. During November 2003, the Company sold
this property for a sales price of approximately $30.6 million which resulted in
a gain on sale of approximately $0.7 million.
During July 2003, the Company acquired a property in Novato, CA, comprising
approximately 0.1 million square feet of GLA, for a purchase price of
approximately $21.9 million. During December 2003, the Company transferred this
property into a newly formed joint venture in which the Company has a 10%
non-controlling interest.
During October 2003, the Company acquired a property located in Florence, KY,
comprising approximately 0.1 million square feet of GLA, for an aggregate
purchase price of approximately $14.9 million.
Additionally, during October 2003, the Company acquired an operating property
located in Juarez, Mexico, comprising approximately 0.1 million square feet of
GLA through a joint venture in which the Company has a 90.0% controlling
interest. The property was acquired for a purchase price of approximately $9.9
million.
During November 2003, the Company acquired a property located in Monroeville,
PA, comprising approximately 0.1 million square feet of GLA, for an aggregate
purchase price of approximately $23.5 million.
Dispositions -
During 2003, the Company disposed of, in separate transactions, (i) 10 operating
shopping center properties, for an aggregate sales price of approximately $119.1
million, including the assignment of approximately $1.7 million of mortgage debt
encumbering one of the properties, (ii) two regional malls for an aggregate
sales price of approximately $135.6 million, (iii) one out-parcel for a sales
price of approximately $8.1 million, (iv) transferred three operating properties
to KROP for a price of approximately $144.2 million which approximated their net
book value, (v) transferred an operating property to a newly formed joint
venture in which the Company has a 10% non-controlling interest for a price of
approximately $21.9 million which approximated its net book value and (vi)
terminated four leasehold positions in locations where a tenant in bankruptcy
had rejected its lease. These transactions resulted in net gains of
approximately $50.8 million.
10
Redevelopments -
The Company has an ongoing program to reformat and re-tenant its properties to
maintain or enhance its competitive position in the marketplace. During 2003,
the Company substantially completed the redevelopment and re-tenanting of
various operating properties. The Company expended approximately $57.9 million
in connection with these major redevelopments and re-tenanting projects during
2003. The Company is currently involved in redeveloping several other shopping
centers in the existing portfolio. The Company anticipates its capital
commitment toward these and other redevelopment projects will be approximately
$50.0 million to $75.0 million during 2004.
Kimco Developers, Inc. ("KDI") -
Effective January 1, 2001, the Company elected taxable REIT subsidiary status
for its wholly-owned subsidiary, KDI. KDI is primarily engaged in the ground-up
development of neighborhood and community shopping centers and the subsequent
sale thereof upon completion. As of December 31, 2003, KDI had in progress 26
ground-up development projects located in nine states. These projects had
substantial pre-leasing prior to the commencement of construction. During 2003,
KDI expended approximately $208.9 million in connection with the purchase of
land and construction costs related to these projects. These projects are
currently proceeding on schedule and in line with the Company's budgeted costs.
The Company anticipates its capital commitment toward these and other
development projects will be approximately $160.0 million to $200.0 million
during 2004. The proceeds from the sales of the completed ground-up development
projects during 2004 and proceeds from construction loans are expected to be
sufficient to fund these anticipated capital requirements.
KDI Acquisitions -
During the year ended December 31, 2003, KDI acquired interests in 12 land
parcels, in separate transactions, for the ground-up development of shopping
centers and subsequent sales thereof upon completion for an aggregate purchase
price of approximately $80.2 million, as follows:
Purchase Price
Date Acquired City State (in millions)
------------- ---- ----- --------------
February 2003 Avondale AZ $ 2.2
March 2003 Raleigh NC 3.2
April 2003 Maricopa AZ 2.7
May 2003 Muskegan MI 4.2
June 2003 Vancouver WA 9.4
July 2003 Birmingham AL 2.5
September 2003 Longview WA 16.5
September 2003 Ft. Worth TX 8.5
October 2003 Burleson TX 5.6
December 2003 Lake Worth TX 11.8
December 2003 Jacksonville FL 7.6
December 2003 Houston TX 6.0
-----
$80.2
=====
The estimated project costs for these newly acquired parcels is approximately
$220.0 million with completion dates ranging from June 2004 to December 2005.
During 2003, the Company obtained individual construction loans on seven
ground-up development projects and paid off construction loans on three
ground-up development properties. At December 31, 2003 total loan commitments on
the remaining 13 construction loans aggregate approximately $238.9 million of
which approximately $92.8 million has been funded. These loans have maturities
ranging from 3 to 34 months and bear interest at rates ranging from 2.87% to
5.0% at December 31, 2003.
KDI Dispositions -
During the year ended December 31, 2003, KDI sold four of its recently completed
projects and 26 out-parcels for approximately $134.6 million. These sales
resulted in pre-tax gains of approximately $17.5 million. Details are as
follows:
11
Sales Price
Date Sold Project City State (in millions)
- --------- ------- ---- ----- -------------
January 2003 Various (4 out-parcels) Various NV, OH, AZ $ 3.4
February 2003 Wakefield Crossing (1 out-parcel) Raleigh NC 0.5
March 2003 Gateway Station (1 out-parcel) Burleson TX 1.3
April 2003 Wakefield Crossings (4 out-parcels) Various Various 3.1
May 2003 Sale of built up space at Gilbert Fiesta Gilbert Fiesta AZ 10.8
June 2003 Hamstra Square (Sale of Center) Chandler AZ 13.0
June 2003 Gateway Station (Phase I) Burleson TX 27.9
June 2003 Various (2 out-parcels) Various TX, NV 8.6
July 2003 Various (3 out-parcels) Various NC, OH, AZ 2.0
August 2003 Various (2 out-parcels) Various NC, TX 2.3
September 2003 Hillsborough (sale of center) Hillsborough NJ 46.5
October 2003 Various (3 out-parcels) Various TX, WA 5.6
November 2003 Various (5 out-parcels) Various AZ, WA 8.5
December 2003 Gateway Station (1 out-parcel) Burleson TX 1.1
------
$134.6
======
Operating Real Estate Joint Venture Investments -
Kimco Income REIT ("KIR") -
During 1998, the Company formed KIR, an entity that was established for the
purpose of investing in high quality real estate properties financed primarily
with individual non-recourse mortgages. These properties include, but are not
limited to, fully developed properties with strong, stable cash flows from
credit-worthy retailers with long-term leases. The Company originally held a
99.99% limited partnership interest in KIR. Subsequent to KIR's formation, the
Company sold a significant portion of its original interest to an institutional
investor and admitted three other limited partners. As of December 31, 2003, KIR
has received total capital commitments of $569.0 million, of which the Company
subscribed for $247.0 million and the four limited partners subscribed for
$322.0 million. The Company has a 43.3% non-controlling limited partnership
interest in KIR, manages the portfolio and accounts for its investment under the
equity method of accounting.
During 2003, the limited partners in KIR contributed $30.0 million towards their
respective capital commitments, including $13.0 million by the Company. As of
December 31, 2003, KIR had unfunded capital commitments of $99.0 million,
including $42.9 million from the Company.
During 2003, KIR purchased two shopping center properties, in separate
transactions, aggregating approximately 0.6 million square feet of GLA for
approximately $103.5 million.
During September 2003, KIR elected to terminate its secured revolving credit
facility. This facility was scheduled to expire in November 2003 and had $5.0
million outstanding at the time of termination, which was paid in full.
During December 2003, KIR disposed of, in separate transactions, two out-parcels
located in Las Vegas, NV, for an aggregate sales price of approximately $1.4
million, which represented the approximate carrying value of the property.
As of December 31, 2003, the KIR portfolio was comprised of 70 shopping center
properties aggregating approximately 14.6 million square feet of GLA located in
21 states.
During 2003, KIR obtained individual non-recourse, non-cross collateralized
fixed-rate ten year mortgages aggregating approximately $78.0 million on two of
its previously unencumbered properties with rates ranging from 5.54% to 5.82%
per annum. The net proceeds were used to satisfy the outstanding balance on the
secured credit facility and partially fund the acquisition of various shopping
center properties.
12
Kimco / G.E. Joint Venture ("KROP") -
During 2001, the Company formed a joint venture (the "Kimco Retail Opportunity
Portfolio" or "KROP") with GE Capital Real Estate ("GECRE"), in which the
Company has a 20% non-controlling interest and manages the portfolio. The
purpose of this joint venture is to acquire established, high-growth potential
retail properties in the United States. Total capital commitments to KROP from
GECRE and the Company are for $200.0 million and $50.0 million, respectively,
and such commitments are funded proportionately as suitable opportunities arise
and are agreed to by GECRE and the Company. The Company accounts for its
investment in KROP under the equity method of accounting.
During 2003, GECRE and the Company contributed approximately $45.6 million and
$11.4 million, respectively, towards their capital commitments. Additionally,
GECRE and the Company provided short-term interim financing for all acquisitions
made by KROP without a mortgage in place at the time of acquisition. All such
financing bears interest at rates ranging from LIBOR plus 4.0% to LIBOR plus
5.25% and have maturities of less than one year. As of December 31, 2003, KROP
had outstanding short-term interim financing due to GECRE and the Company
totaling $16.8 million each.
During 2003, KROP purchased, in separate transactions, eight shopping centers
comprising approximately 1.9 million square feet of GLA for an aggregate
purchase price of approximately $250.2 million, including the assumption of
approximately $6.5 million of mortgage debt encumbering one of the properties.
During December 2003, KROP disposed of a portion of a shopping center located in
Columbia, MD, for an aggregate sales price of approximately $2.8 million, which
approximated the carrying value.
During 2003, KROP obtained individual non-recourse, non-cross collateralized
fixed-rate mortgages aggregating approximately $89.3 million on three of its
previously unencumbered properties with rates ranging from 4.25% to 5.92% and
terms ranging from five to ten years.
During 2003, KROP obtained individual non-recourse, non-cross collateralized
variable-rate five year mortgages aggregating approximately $35.6 million on
five of its previously unencumbered properties with rates ranging from LIBOR
plus 2.2% to LIBOR plus 2.5%. In order to mitigate the risks of interest rate
fluctuations associated with these variable rate obligations, KROP entered into
interest rate cap agreements for the notional values of these mortgages.
As of December 31, 2003, the KROP portfolio was comprised of 23 shopping center
properties aggregating approximately 3.5 million square feet of GLA located in
12 states.
International Real Estate Joint Venture Investments -
Canadian Investments -
During October 2001, the Company formed the RioCan Venture in which the Company
has a 50% non-controlling interest, to acquire retail properties and development
projects in Canada. The acquisition and development projects are to be sourced
and managed by RioCan and are subject to review and approval by a joint
oversight committee consisting of RioCan management and the Company's management
personnel. Capital contributions will only be required as suitable opportunities
arise and are agreed to by the Company and RioCan.
During 2003, the RioCan Venture acquired a shopping center property comprising
approximately 0.2 million square feet of GLA for a purchase price of
approximately CAD $42.6 million (approximately USD $29.0 million) including the
assumption of approximately CAD $28.7 million (approximately USD $19.6 million)
of mortgage debt. Additionally during 2003, the RioCan Venture acquired, in a
single transaction, four parcels of land adjacent to an existing property for a
purchase price of approximately CAD $18.7 million (approximately USD $14.2
million). This property was subsequently encumbered with non-recourse mortgage
debt of approximately CAD $16.3 million (approximately USD $12.4 million).
As of December 31, 2003, the RioCan Venture was comprised of 31 operating
properties and three development properties, consisting of approximately 7.2
million square feet of GLA.
Mexican Investments -
During October 2002, the Company, in separate transactions, acquired two
operating properties located in Saltillo and Monterrey, Mexico, comprising
approximately 0.3 million square feet of GLA for an aggregate purchase price of
approximately $368.5 million pesos ("MXN") (USD $35.7 million). The Monterrey
site consisted of a portion under development of approximately 0.1 million
square feet of GLA which was completed during October 2003, for a cost of
approximately MXN $57.9 million (USD $5.8 million).
13
During December 2003, the Company, in a single transaction, sold a 50.0%
interest in each of its properties located in Saltillo and Monterrey, Mexico for
an aggregate sales price of approximately MXN $240.4 million (USD $21.4 million)
which approximated 50.0% of their aggregate carrying value.
Other Real Estate Joint Ventures -
The Company and its subsidiaries have investments in and advances to various
other real estate joint ventures. These joint ventures are engaged primarily in
the operation of shopping centers which are either owned or held under long-term
operating leases.
During June 2003, the Company acquired a former Service Merchandise property
located in Novi, MI, through a joint venture, in which the Company has a 42.5%
non-controlling interest. The property was acquired for a purchase price of
approximately $4.1 million.
During June 2003, the Company acquired a property located in South Bend, IN,
through a joint venture in which the Company has a 37.5% non-controlling
interest. The property was acquired for an aggregate purchase price of
approximately $4.9 million.
During July 2003, the Company acquired a property located in Pineville, NC,
through a joint venture, in which the Company has a 20.0% non-controlling
interest. The property was acquired for a purchase price of approximately $27.3
million, including $19.3 million of non-recourse mortgage debt encumbering the
property.
During August 2003, the Company acquired a property located in Shaumburg, IL,
through a joint venture in which the Company has a 45.0% non-controlling
interest. The property was acquired for an aggregate purchase price of
approximately $66.6 million. Simultaneous with the acquisition, the venture
obtained a $51.6 million non-recourse mortgage at a floating interest rate of
LIBOR plus 2.25%.
Additionally, during the year ended December 31, 2003, the Company acquired 11
properties, in separate transactions, through various joint ventures in which
the Company has a 50.0% non-controlling interest. These properties were acquired
for an aggregate purchase price of approximately $113.3 million, including the
assumption of approximately $40.5 million of non-recourse debt encumbering six
of the properties.
Other Real Estate Investments -
Kmart Venture -
During July 2002, the Company, through a taxable REIT subsidiary, formed a
venture (the "Kmart Venture") in which the Company has a controlling interest
for purposes of acquiring asset designation rights for 54 former Kmart
locations. The total commitment to Kmart by the Kmart Venture, prior to the
profit sharing arrangement commencing, was approximately $43.0 million. As of
December 31, 2003, the Kmart Venture completed the designation of all properties
and has funded the total commitment of approximately $43.0 million to Kmart.
During 2003, the Kmart Venture commenced the profit sharing arrangement and the
Company recognized pre-tax profits of approximately $0.6 million.
Kimsouth -
During November 2002, the Company, through its taxable REIT subsidiary, together
with Prometheus Southeast Retail Trust, completed the merger and privatization
of Konover Property Trust, which has been renamed Kimsouth Realty, Inc.,
("Kimsouth"). The Company acquired 44.5% of the common stock of Kimsouth, which
consisted primarily of 38 retail shopping center properties comprising
approximately 4.6 million square feet of GLA. Total acquisition value was
approximately $280.9 million including approximately $216.2 million in assumed
mortgage debt. The Company's investment strategy with respect to Kimsouth
includes re-tenanting, repositioning and disposition of the properties.
During 2003, Kimsouth disposed of 14 shopping center properties, in separate
transactions, for an aggregate sales price of approximately $84.0 million,
including the assignment of approximately $18.4 million of mortgage debt
encumbering six of the properties. During 2003, the Company recognized pre-tax
profits from the Kimsouth investment of approximately $12.1 million which is
included in the caption Income from other real estate investments on the
Company's Consolidated Statements of Income.
As of December 31, 2003, the Kimsouth portfolio was comprised of 22 properties
aggregating approximately 3.2 million square feet of GLA located in six states.
14
Preferred Equity Capital -
During 2002, the Company established a preferred equity program, which provides
capital to developers and owners of shopping centers. As of December 31, 2003,
the Company has provided, in separate transactions, an aggregate of
approximately $66.4 million in investment capital to developers and owners of 21
shopping centers.
Mortgages and Other Financing Receivables -
During March 2002, the Company provided a $50.0 million ten-year loan to Shopko
Stores Inc., at an interest rate of 11.0% per annum collateralized by 15
properties. The Company receives principal and interest payments on a monthly
basis. During January 2003, the Company sold a $37.0 million participation
interest in this loan to an unaffiliated third party. The interest rate of the
$37.0 million participation interest is a variable rate based on LIBOR plus
3.50%. The Company continues to act as the servicer for the full amount of the
loan.
During May 2002, in connection with Frank's Nursery & Crafts, Inc. ("Franks")
emergence from Chapter 11 under the U.S. Bankruptcy Code, the Company received
approximately 4.3 million shares of Frank's common stock in settlement of its
pre-petition claim. The Company also provided exit financing in the form of a
$15.0 million three-year term loan at a fixed interest rate of 10.25% per annum
collateralized by 40 real estate interests. Simultaneously, the Company provided
an additional $17.5 million revolving loan, also at an interest rate of 10.25%
per annum. Interest is payable quarterly in arrears. As of December 31, 2003,
the aggregate outstanding loan balance was approximately $32.5 million. As an
inducement to make these loans, Frank's issued the Company approximately 4.4
million warrants with an exercise price of $1.15 per share and 5.0 million
warrants with an exercise price of $2.00 per share. During 2003, the Company had
written down the remaining carrying value of its equity investment in Frank's
common stock and fully reserved the value of the Frank's warrants, with a
corresponding adjustment in Other comprehensive income ("OCI").
During June 2003, the Company provided a five-year $3.5 million loan to Grass
America, Inc. ("Grass America") at an interest rate of 12.25% per annum
collateralized by certain real estate interests of Grass America. The Company
receives principal and interest payments on a monthly basis.
During December 2003, the Company provided a four-year $8.25 million term loan
to Spartan Stores, Inc. ("Spartan") at a fixed rate of 16.0% per annum. This
loan is collateralized by the real estate interests of Spartan. The Company
receives principal and interest payments monthly.
During December 2003, the Company, through a taxable REIT subsidiary, acquired a
$24.0 million participation interest in 12% senior secured notes of the FRI-MRD
Corporation ("FRI-MRD") for $13.3 million. These notes, which are currently
non-performing, are collateralized by certain equity interests and a note
receivable of a FRI-MRD subsidiary.
Financing Transactions -
Unsecured Debt -
During May 2003, the Company issued $50.0 million of fixed-rate unsecured senior
notes under its medium-term notes ("MTN") program. This fixed rate MTN matures
in May 2010 and bears interest at 4.62% per annum, payable semi-annually in
arrears. The proceeds from this MTN issuance were used to partially fund the
redemption of the Company's $75.0 million 7 3/4% Class A Cumulative Redeemable
Preferred Stock.
During August 2003, the Company issued $100.0 million of fixed-rate unsecured
senior notes under its MTN program. This fixed rate MTN matures in August 2008
and bears interest at 3.95% per annum, payable semi-annually in arrears. The
proceeds from this MTN issuance were used to redeem all $100.0 million of the
Company's remarketed reset notes due August 18, 2008, bearing interest at LIBOR
plus 1.25%.
During October 2003, the Company issued $100.0 million of fixed-rate unsecured
senior notes under its MTN program. This fixed rate MTN matures in October 2013
and bears interest at 5.19% per annum, payable semi-annually in arrears. The
proceeds from this MTN issuance were used for the repayment of the Company's
6.5% $100.0 million fixed-rate unsecured senior notes which matured October 1,
2003.
Construction Loans -
During 2003, the Company obtained construction financing on seven ground-up
development projects for an aggregate loan amount of up to $152.2 million, of
which approximately $45.6 million was funded as of December 31, 2003. As of
December 31, 2003, the Company had a total of 13 construction loans with total
commitments of up to $238.9 million of which $92.8 million had been funded to
the Company. These loans have maturities ranging from 3 to 34 months and
variable interest rates ranging from 2.87% to 5.00% at December 31, 2003.
15
Early Extinguishment of Non-Recourse Mortgages -
As part of the Company's strategy to reduce its exposure to Kmart Corporation,
the Company had previously encumbered certain Kmart sites with individual
non-recourse mortgages. As a result of the Kmart bankruptcy filing in January
2002 and the subsequent rejection of leases including leases at these encumbered
sites, the Company suspended debt service payments on these loans and began
active negotiations with the respective lenders.
During February 2003, the Company reached agreement with a lender in connection
with two former Kmart encumbered locations. The Company paid approximately $8.3
million in full satisfaction of these loans which aggregated approximately $14.7
million. The Company recognized a gain on early extinguishment of debt of
approximately $6.2 million as a result of this transaction.
During December 2003, the Company reached agreement with a lender in connection
with an individual non-recourse mortgage encumbering a former Kmart site located
in Chicago, IL. The Company paid approximately $5.9 million in full satisfaction
of this loan which had a outstanding balance of approximately $9.3 million. As a
result of this transaction, the Company recognized a gain on early
extinguishment of debt of approximately $3.5 million.
Credit Facilities -
The Company maintains a $500.0 million unsecured revolving credit facility (the
"Credit Facility") with a group of banks which is scheduled to mature in August
2006. Under the terms of the Credit Facility, funds may be borrowed for general
corporate purposes, including (i) funding property acquisitions, (ii) funding
development and redevelopment costs and (iii) funding any short-term working
capital requirements. Interest on borrowings under the Credit Facility accrues
at a spread (currently 0.55%) to LIBOR, which fluctuates in accordance with
changes in the Company's senior debt ratings. The Company's senior debt ratings
are currently A-/stable from Standard & Poors and Baa1/stable from Moody's
Investor Services. As part of the Credit Facility, the Company has a competitive
bid option where the Company may auction up to $250.0 million of its requested
borrowings to the bank group. This competitive bid option provides the Company
the opportunity to obtain pricing below the currently stated spread to LIBOR of
0.55%. As of December 31, 2003, there was $45.0 million outstanding under the
Credit Facility.
During October 2003, the Company obtained a $400.0 million unsecured bridge
facility that bears interest at LIBOR plus 0.55%. This loan is scheduled to
expire September 30, 2004 with an option to extend up to $150.0 million for an
additional year. The Company utilized these proceeds to partially fund the
Mid-Atlantic Realty Trust transaction. As of December 31, 2003, there was $329.0
million outstanding on this unsecured bridge facility.
Equity -
During June 2003, the Company redeemed all 2,000,000 outstanding depositary
shares of the Company's 8 1/2% Class B Cumulative Redeemable Preferred Stock,
par value $1.00 per share ("Class B Preferred Stock"), all 3,000,000 outstanding
depositary shares of the Company's 7 3/4% Class A Cumulative Redeemable
Preferred Stock, par value $1.00 per share ("Class A Preferred Stock") and all
4,000,000 outstanding depositary shares of the Company's 8 3/8% Class C
Cumulative Redeemable Preferred Stock, par value $1.00 per share ("Class C
Preferred Stock"), each at a redemption price of $25.00 per depositary share,
totaling $225.0 million, plus accrued dividends.
During June 2003, the Company issued 7,000,000 Depositary Shares (the "Class F
Depositary Shares"), each representing a one-tenth fractional interest in a
share of the Company's 6.65% Class F Cumulative Redeemable Preferred Stock, par
value $1.00 per share (the "Class F Preferred Stock"). Dividends on the Class F
Depositary Shares are cumulative and payable quarterly in arrears at the rate of
6.65% per annum based on the $25.00 per share initial offering price, or $1.6625
per annum. The Class F Depositary Shares are redeemable, in whole or part, for
cash on or after June 5, 2008 at the option of the Company, at a redemption
price of $25.00 per depositary share, plus any accrued and unpaid dividends
thereon. The Class F Depositary Shares are not convertible or exchangeable for
any other property or securities of the Company. Net proceeds from the sale of
the Class F Depositary Shares, totaling approximately $169.0 million (after
related transaction costs of $6.0 million) were used to redeem all of the
Company's Class B Preferred Stock and Class C Preferred Stock and to fund a
portion of the redemption of the Company's Class A Preferred Stock.
Additionally, during June 2003, the Company completed a primary public stock
offering of 2,070,000 shares of the Company's common stock. The net proceeds
from this sale of common stock, totaling approximately $76.0 million (after
related transaction costs of $0.7 million) were used for general corporate
purposes, including the acquisition of interests in real estate properties.
16
During September 2003, the Company completed a primary public stock offering of
2,760,000 shares of the Company's common stock. The net proceeds from this sale
of common stock, totaling approximately $112.7 million (after related
transaction costs of $1.0 million) were used for general corporate purposes,
including the acquisition of interests in real estate properties.
Hedging Activities -
During 2002 and 2003, the Company entered into various foreign currency forward
contracts and a cross currency swap aggregating approximately CAD $189.6 million
and MXN $381.8 million in connection with the Company's Canadian and Mexican
real estate investments and investment in stock of RioCan. During December 2003,
the Company sold a 50% interest in its Saltillo and Monterrey, Mexico
properties. In connection with this sale, the Company partially assigned to the
buyer a portion of its foreign currency forwards and cross currency swap
aggregating approximately MXN $156.9 million. At December 31, 2003, the
Company's remaining portion of these foreign currency forwards and cross
currency swap is approximately MXN $224.9 million, which fully hedges the
Company's remaining investment in these properties. (See Note 17 of the Notes to
Consolidated Financial Statements included in this annual report on Form 10-K.)
Exchange Listings
The Company's common stock and Class F Depositary Shares are traded on the NYSE
under the trading symbols "KIM" and "KIMprF", respectively. Trading of the Class
A, B and C Depositary Shares ceased in June 2003 in connection with the
Company's redemption of such shares.
Item 2. Properties
Real Estate Portfolio As of January 1, 2004, the Company's real estate
portfolio was comprised of interests in approximately 93.5 million square feet
of GLA (not including 26 property interests comprising 3.9 million square feet
of GLA related to the Preferred Equity program and 4.9 million square feet of
projected GLA for the ground-up development projects) in 594 neighborhood and
community shopping center properties, 37 retail store leases, 10 parcels of
undeveloped land and 28 projects under development, located in 41 states, Canada
and Mexico. The Company's portfolio includes a 43.3% interest in 70 shopping
center properties comprising approximately 14.6 million square feet of GLA
relating to KIR, a 50% interest in 31 shopping center properties comprising
approximately 7.3 million square feet of GLA relating to the RioCan Venture and
a 20% interest in 23 shopping center properties comprising approximately 3.5
million square feet of GLA relating to KROP. Neighborhood and community shopping
centers comprise the primary focus of the Company's current portfolio. As of
January 1, 2004, approximately 90.7% of the Company's neighborhood and community
shopping center space (excluding the KIR, KROP and Kimsouth portfolios) was
leased, and the average annualized base rent per leased square foot of the
portfolio was $8.79. As of January 1, 2004, the KIR, KROP and Kimsouth
portfolios were 97.7%, 98.2% and 80.2% leased, respectively, with an average
annualized base rent per leased square foot of $11.85, $12.49 and $8.63,
respectively.
The Company's neighborhood and community shopping center properties, generally
owned and operated through subsidiaries or joint ventures, had an average size
of approximately 148,000 square feet as of January 1, 2004. The Company
generally retains its shopping centers for long-term investment and consequently
pursues a program of regular physical maintenance together with major
renovations and refurbishing to preserve and increase the value of its
properties. These projects usually include renovating existing facades,
installing uniform signage, resurfacing parking lots and enhancing parking lot
lighting. During 2003, the Company capitalized approximately $6.2 million in
connection with these property improvements and expensed to operations
approximately $17.5 million.
The Company's neighborhood and community shopping centers are usually "anchored"
by a national or regional discount department store, supermarket or drugstore.
As one of the original participants in the growth of the shopping center
industry and one of the nation's largest owners and operators of shopping
centers, the Company has established close relationships with a large number of
major national and regional retailers. Some of the major national and regional
companies that are tenants in the Company's shopping center properties include
The Home Depot, Kmart Corporation, Kohl's, Royal Ahold, TJX Companies, Wal-Mart,
Great Atlantic & Pacific, Best Buy, Toys R' Us, and Bed Bath & Beyond.
17
A substantial portion of the Company's income consists of rent received under
long-term leases. Most of the leases provide for the payment of fixed base
rentals monthly in advance and for the payment by tenants of an allocable share
of the real estate taxes, insurance, utilities and common area maintenance
expenses incurred in operating the shopping centers. Although many of the leases
require the Company to make roof and structural repairs as needed, a number of
tenant leases place that responsibility on the tenant, and the Company's
standard small store lease provides for roof repairs to be reimbursed by the
tenant as part of common area maintenance. The Company's management places a
strong emphasis on sound construction and safety at its properties.
Approximately 1,918 of the Company's 6,820 leases also contain provisions
requiring the payment of additional rent calculated as a percentage of tenants'
gross sales above predetermined thresholds. Percentage Rents accounted for
approximately 1% of the Company's revenues from rental property for the year
ended December 31, 2003.
Minimum base rental revenues and operating expense reimbursements accounted for
approximately 99% of the Company's total revenues from rental property for the
year ended December 31, 2003. The Company's management believes that the base
rent per leased square foot for many of the Company's existing leases is
generally lower than the prevailing market-rate base rents in the geographic
regions where the Company operates, reflecting the potential for future growth.
For the period January 1, 2003 to December 31, 2003, the Company increased the
average base rent per leased square foot in its consolidated portfolio of
neighborhood and community shopping centers from $8.31 to $8.79, an increase of
$0.48. This increase primarily consists of (i) a $0.32 increase relating to the
net effect of acquisitions and dispositions, (ii) an $0.11 increase related to
the fluctuation in exchange rates related to the Canadian denominated leases,
and (iii) a $0.05 increase relating to new leases signed net of leases vacated.
The Company seeks to reduce its operating and leasing risks through geographic
and tenant diversity. No single neighborhood and community shopping center
accounted for more than 0.6% of the Company's total shopping center GLA or more
than 1.0% of total annualized base rental revenues as of December 31, 2003. The
Company's five largest tenants include The Home Depot, Kmart Corporation,
Kohl's, Royal Ahold and TJX Companies, which represent approximately 3.0%, 2.9%,
2.8%, 2.6% and 2.5%, respectively, of the Company's annualized base rental
revenues, including the proportionate share of base rental revenues from
properties in which the Company has less than a 100% economic interest. The
Company maintains an active leasing and capital improvement program that,
combined with the high quality of the locations, has made, in management's
opinion, the Company's properties attractive to tenants.
The Company's management believes its experience in the real estate industry and
its relationships with numerous national and regional tenants gives it an
advantage in an industry where ownership is fragmented among a large number of
property owners.
Retail Store Leases In addition to neighborhood and community shopping
centers, as of January 1, 2004, the Company had interests in retail store leases
totaling approximately 3.4 million square feet of anchor stores in 37
neighborhood and community shopping centers located in 20 states. As of January
1, 2004, approximately 86.0% of the space in these anchor stores had been sublet
to retailers that lease the stores under net lease agreements providing for
average annualized base rental payments of $4.07 per square foot. The average
annualized base rental payments under the Company's retail store leases to the
land owners of such subleased stores is approximately $2.60 per square foot. The
average remaining primary term of the retail store leases (and, similarly, the
remaining primary terms of the sublease agreements with the tenants currently
leasing such space) is approximately 4.5 years, excluding options to renew the
leases for terms which generally range from 5 to 25 years. The Company's
investment in retail store leases is included in the caption Other Real Estate
Investments on the Company's Consolidated Balance Sheets.
Ground-Leased Properties The Company has interests in 60 shopping center
properties that are subject to long-term ground leases where a third party owns
and has leased the underlying land to the Company (or an affiliated joint
venture) to construct and/or operate a shopping center. The Company or the joint
venture pays rent for the use of the land and generally is responsible for all
costs and expenses associated with the building and improvements. At the end of
these long-term leases, unless extended, the land together with all improvements
revert to the land owner.
Ground-Up Development Properties As of January 1, 2004, the Company, through
its wholly-owned taxable REIT subsidiary, KDI, has currently in progress 26
ground-up development projects located in nine states which are expected to be
sold upon completion. These projects had substantial pre-leasing prior to the
commencement of construction. As of January 1, 2004, the average annual base
rent per leased square foot for the KDI portfolio was $14.22 and the average
annual base rent per leased square foot for new leases executed in 2003 was
$15.24.
18
Undeveloped Land The Company owns certain unimproved land tracts and parcels
of land adjacent to certain of its existing shopping centers that are held for
possible expansion. At times, should circumstances warrant, the Company may
develop or dispose of these parcels.
The table on pages 20 to 27 sets forth more specific information with respect to
each of the Company's property interests.
Item 3. Legal Proceedings
The Company is not presently involved in any litigation nor to its knowledge is
any litigation threatened against the Company or its subsidiaries that, in
management's opinion, would result in any material adverse effect on the
Company's ownership, management or operation of its properties, or which is not
covered by the Company's liability insurance.
Item 4. Submission of Matters to a Vote of Security Holders
- ------------------------------------------------------------
None.
19
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
ALABAMA
BIRMINGHAM (4) 2003 JOINT VENTURE 21.4 85,000 100.0 TJ MAXX
FAIRFIELD 2000 FEE 8.7 86,566 100.0 TELETECH CUSTOM
HOOVER 2000 FEE 11.5 115,347 100.0 WAL-MART
MOBILE (9) 2002 JOINT VENTURE 52.6 525,505 67.5 KROGER
ALASKA
KENAI 2003 JOINT VENTURE 14.7 146,759 100.0 HOME DEPOT
ARIZONA
AVONDALE (4) 2003 JOINT VENTURE 17.3 21,000 100.0
FOUNTAIN HILLS (4) 2001 JOINT VENTURE 23.2 113,000 99.0 WALGREENS
GILBERT FIESTA (4) 2002 JOINT VENTURE 1.8 - -
GLENDALE (7) 1998 FEE 40.5 333,388 99.6 COSTCO
GLENDALE 1998 JOINT VENTURE 48.2 111,825 81.7 SEARS
MARANA 2003 FEE 18.2 191,008 100.0 LOWE'S HOME CENTER
MARICOPA (4) 2003 FEE 15.1 68,000 100.0 BASHAS'
MESA 1998 FEE 19.8 146,492 93.6 ROSS STORES
NORTH PHOENIX 1998 FEE 17.0 230,164 100.0 BURLINGTON COAT FACTORY
PEORIA (4) 2000 JOINT VENTURE 69.8 218,000 99.2 KOHLS
PHOENIX 1998 FEE 13.4 153,174 90.5 HOME DEPOT
PHOENIX 1998 FEE 26.6 333,382 61.3 COSTCO
PHOENIX 1997 FEE 17.5 131,621 88.3 SAFEWAY
TEMPE 1998 JOINT VENTURE 21.1 236,015 43.5 PETSMART
TEMPE (5) 1998 JOINT VENTURE 20.0 - -
TUCSON 2003 JOINT VENTURE 17.8 190,174 100.0 LOWE'S HOME CENTER
CALIFORNIA
ALHAMBRA 1998 FEE 18.4 174,996 100.0 COSTCO
ANAHEIM 1995 FEE 1.0 15,396 100.0
CARMICHAEL 1998 FEE 18.5 212,811 98.8 HOME DEPOT
CHULA VISTA 1998 FEE 31.3 329,245 100.0 COSTCO
COLMA (8) 2003 JOINT VENTURE 6.4 213,532 100.0 MARSHALLS
CORONA 1998 FEE 47.6 486,958 99.2 COSTCO
COVINA (7) 2000 GROUND LEASE (2054) 26.0 269,433 98.0 HOME DEPOT
DALY CITY 2002 FEE 25.6 439,600 84.4 BURLINGTON COAT FACTORY
EL CAJON 2003 JOINT VENTURE 11.8 120,711 100.0 KOHLS
FOLSOM 2003 JOINT VENTURE 10.8 108,225 100.0 KOHLS
LA MIRADA 1998 FEE 31.2 288,471 92.6 TOYS "R" US
MONTEBELLO (7) 2000 FEE 20.4 250,439 100.0 SEARS
MORGAN HILL 2003 JOINT VENTURE 10.3 103,362 100.0 HOME DEPOT
NOVATO 2003 FEE 11.3 125,462 100.0 SAFEWAY
OXNARD (7) 1998 FEE 14.4 171,580 100.0 TARGET
SAN DIEGO (7) 2000 FEE 11.2 117,410 100.0 LUCKY STORES
SAN RAMON (7) 1999 FEE 5.3 42,066 86.3 PETCO
SANTA ANA 1998 FEE 12.0 134,400 100.0 HOME DEPOT
SANTEE 2003 JOINT VENTURE 31.1 311,485 93.2 TJ MAXX
SANTEE 1998 FEE 10.4 103,903 98.8 OFFICE DEPOT
STOCKTON 1999 FEE 14.6 152,919 96.6 SUPER UNITED FURNITURE
TEMECULA (7) 1999 FEE 40.0 341,612 97.9 KMART
TORRANCE (7) 2000 FEE 26.7 266,917 97.0 HL TORRANCE
TUSTIN 2003 JOINT VENTURE 10.8 108,413 100.0 KMART
COLORADO
AURORA 1998 FEE 13.8 145,754 77.9 TJ MAXX
AURORA 1998 FEE 9.9 44,174 100.0
AURORA 1998 FEE 13.9 152,981 99.0 ALBERTSONS
COLORADO SPRINGS 1998 FEE 10.7 107,310 90.6 ALBERTSONS
DENVER 1998 FEE 1.5 18,405 100.0 SAV-A-LOT
ENGLEWOOD 1998 FEE 6.5 80,330 100.0 HOBBY LOBBY
FORT COLLINS 2000 FEE 11.8 117,862 89.8 KOHLS
GREENWOOD VILLAGE 2003 JOINT VENTURE 21.0 196,726 100.0 HOME DEPOT
LAKEWOOD 1998 FEE 7.6 82,581 95.0 SAFEWAY
CONNECTICUT
BRANFORD (7) 2000 FEE 19.2 191,574 98.5 KOHLS
ENFIELD (7) 2000 FEE 16.2 162,459 100.0 KOHLS
FARMINGTON 1998 FEE 16.9 184,572 95.3 SPORTS AUTHORITY
HAMDEN 1967 JOINT VENTURE 31.7 341,502 98.1 WAL-MART
NORTH HAVEN 1998 FEE 31.7 331,919 100.0 HOME DEPOT
WATERBURY 1993 FEE 13.1 137,943 100.0 RAYMOUR & FLANIGAN
DELAWARE
ELSMERE 1979 GROUND LEASE (2076) 17.1 114,530 100.0 VALUE CITY
DOVER (5) 1999 JOINT VENTURE 89.0 - -
MILFORD 2003 FEE 7.8 61,100 89.4 FOOD LION
WILMINGTON 2003 GROUND LEASE (2052) 25.9 165,805 100.0 SHOPRITE
FLORIDA
ALTAMONTE SPRINGS 1995 FEE 5.6 94,193 100.0 ORIENTAL MARKET
ALTAMONTE SPRINGS 1998 JOINT VENTURE 19.4 271,095 71.6 ALTAMANTE CINEMA 8
BOCA RATON 1967 FEE 9.9 73,549 100.0 WINN DIXIE
BOYNTON BEACH (7) 1999 FEE 18.0 197,362 99.7 BEALLS
BRADENTON 1968 JOINT VENTURE 6.2 30,938 100.0 GRAND CHINA BUFFET
BRADENTON 1998 FEE 19.6 162,997 95.8 PUBLIX
BRANDON (7) 2001 FEE 29.7 143,785 99.1 BED BATH & BEYOND
CORAL SPRINGS 1994 FEE 5.9 55,597 100.0 LINENS N THINGS
CORAL SPRINGS 1997 FEE 9.8 86,342 100.0 TJ MAXX
CORAL WAY 1992 JOINT VENTURE 8.7 87,305 100.0 WINN DIXIE
EAST ORLANDO 1971 GROUND LEASE (2068) 11.6 131,981 99.1 SPORTS AUTHORITY
FORT PIERCE 1970 JOINT VENTURE 14.8 210,460 99.0 KMART
HOLLYWOOD 2002 JOINT VENTURE 5.0 50,000 100.0 HOME GOODS
HOLLYWOOD (9) 2002 JOINT VENTURE 13.5 135,056 95.3 WINN DIXIE
HOMESTEAD 1972 GROUND LEASE (2018)/JOINT VENTURE 21.0 208,794 99.5 PUBLIX
JACKSONVILLE 2002 JOINT VENTURE 5.1 51,000 100.0 MICHAELS
JACKSONVILLE 1999 FEE 18.6 203,536 97.6 BURLINGTON COAT FACTORY
JACKSONVILLE (4) 2003 JOINT VENTURE 113.6 - -
JENSEN BEACH (9) 2002 JOINT VENTURE 19.8 197,731 94.9 HOME DEPOT
MAJOR LEASES
------------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- -----------------------------------------------------------------------------------------------------------------------------------
ALABAMA
BIRMINGHAM (4) 2014 2034 A.C. MOORE 2014 2029 PETSMART 2019 2039
FAIRFIELD 2009 2029
HOOVER 2025 2095
MOBILE (9) 2006 CIRCUIT CITY 2041 2041 MARSHALLS 2005 2012
ALASKA
KENAI 2018 2048
ARIZONA
AVONDALE (4)
FOUNTAIN HILLS (4) 2078 ROSS STORES 2015 2035
GILBERT FIESTA (4)
GLENDALE (7) 2011 2046 LEVITZ 2012 2032 STOOL & DINETTE 2004
GLENDALE 2006 2016 MICHAELS 2008 2018
MARANA 2019 2069
MARICOPA (4) 2024 2044
MESA 2005 HARKINS THEATRE 2005 2025 OUR HOME 2005 2015
NORTH PHOENIX 2013 2023 ULTIMATE ELECTRONICS 2015 2030 MICHAELS 2007 2022
PEORIA (4) 2024 2064 ROSS STORES 2014 2034 MICHAELS 2012 2032
PHOENIX 2020 2050 JO-ANN FABRICS 2010 2025
PHOENIX 2006 2041 RODEO 2005
PHOENIX 2009 2039
TEMPE 2011 2031 STAPLES 2005 2025 GUITAR CENTER 2007 2017
TEMPE (5)
TUCSON 2049 2049
CALIFORNIA
ALHAMBRA 2027 2057 COSTCO 2027 2057 JO-ANN FABRICS 2004 2019
ANAHEIM
CARMICHAEL 2008 2022 SPORTS AUTHORITY 2009 2024 LONGS DRUG 2013 2033
CHULA VISTA 2006 2041 NAVCARE 2009
COLMA (8) 2007 2012 NORDSTROM'S RACK 2007 2017 BED BATH & BEYOND 2011 2026
CORONA 2007 2042 HOME DEPOT 2010 2029 LEVITZ 2009 2029
COVINA (7) 2009 2034 STAPLES 2006 2011 PETSMART 2008 2028
DALY CITY 2012 2022 SAFEWAY 2004 2024 WALGREENS 2007
EL CAJON 2024 2053
FOLSOM 2018 2048
LA MIRADA 2012 2032 LA FITNESS 2012 2022 US POST OFFICE 2010 2020
MONTEBELLO (7) 2012 2062 TOYS "R" US 2018 2043 AMC THEATRES 2012 2032
MORGAN HILL 2024 2054
NOVATO 2008 2028 RITE AID 2008 2023 BIG LOTS 2005 2020
OXNARD (7) 2008 2013 FOOD 4 LESS 2008 24 HOUR FITNESS CENTER 2010 2020
SAN DIEGO (7) 2012 SPORTMART 2013
SAN RAMON (7) 2012 2022
SANTA ANA 2015 2035
SANTEE 2012 BED BATH & BEYOND 2013 PETSMART 2018
SANTEE 2006 2021 ROSS STORES 2009 2024 MICHAELS 2008 2018
STOCKTON 2009 2019 OFFICE DEPOT 2005 2015 COSTCO 2008 2033
TEMECULA (7) 2017 2032 FOOD 4 LESS 2010 2030 TRISTONE THEATRES 2008 2018
TORRANCE (7) 2011 2021 LINENS N THINGS 2010 2020 MARSHALLS 2009 2019
TUSTIN 2018 2048
COLORADO
AURORA 2007 2012 CLASSIC TREASURES 2007 SPACE AGE FEDERAL 2008
AURORA
AURORA 2007 2052 COOMERS CRAFTS 2006 CROWN LIQUORS 2005 2010
COLORADO SPRINGS 2004 2034 EL PASO COUNTY 2005
DENVER 2012 2027
ENGLEWOOD 2013 2023 OLD COUNTRY BUFFET 2009 2019
FORT COLLINS 2020 2070
GREENWOOD VILLAGE 2019 2069
LAKEWOOD 2007 2032
CONNECTICUT
BRANFORD (7) 2007 2022 SUPER FOODMART 2016 2038
ENFIELD (7) 2021 2041 WALDBAUMS 2014 2034
FARMINGTON 2018 2063 LINENS N THINGS 2016 2036 BORDERS BOOKS 2018 2063
HAMDEN 2019 2039 BON-TON 2012 BOB'S STORES 2016 2036
NORTH HAVEN 2009 2029 BJ'S 2006 2041 XPECT DISCOUNT 2008 2013
WATERBURY 2017 2037 STOP & SHOP 2013 2043
DELAWARE
ELSMERE 2008 2038
DOVER (5)
MILFORD 2014 2034
WILMINGTON 2014 2044 SPORTS AUTHORITY 2008 2023 RAYMOUR & FLANIGAN FURNITURE 2019 2044
FLORIDA
ALTAMONTE SPRINGS 2012 2022 THOMASVILLE HOME 2011 2021 PEARL ARTS N CRAFTS 2008 2018
ALTAMONTE SPRINGS 2008 LEATHER GALLERIES, THE 2009 2014 DSW SHOE WAREHOUSE 2012 2032
BOCA RATON 2008 2033
BOYNTON BEACH (7) 2006 2056 ALBERTSONS 2015 2040
BRADENTON 2009 2014
BRADENTON 2012 2032 TJ MAXX 2009 2019 JO-ANN FABRICS 2009 2024
BRANDON (7) 2005 2015 ROSS STORES 2010 2025 THOMASVILLE HOME 2010 2020
CORAL SPRINGS 2012 2027
CORAL SPRINGS 2007 2017 RAG SHOP 2006 2026 BLOCKBUSTER 2006 2016
CORAL WAY 2011 2036 DIAMONDS CRAFTS 2005 2014
EAST ORLANDO 2010 2020 OFFICE DEPOT 2005 2025 C-TOWN 2013 2028
FORT PIERCE 2006 2016 WINN DIXIE 2005 2027 AARON'S 2005 2010
HOLLYWOOD 2010 MICHAELS 2010
HOLLYWOOD (9) 2011 2036 DOLLAR MART PLUS 2, INC. 2007 2011 ECKERD 2006 2021
HOMESTEAD 2014 2034 MARSHALLS 2011 2026 OFFICEMAX 2013 2028
JACKSONVILLE 2013 HOME GOODS 2010
JACKSONVILLE 2008 2018 OFFICEMAX 2012 2032 TJ MAXX 2007 2017
JACKSONVILLE (4)
JENSEN BEACH (9) 2005 2030 PETSMART 2009 2029 RAG SHOP 2005 2020
20
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
JENSEN BEACH 1994 FEE 20.7 173,356 96.9 SERVICE MERCHANDISE
KEY LARGO (7) 2000 FEE 21.5 207,332 96.6 KMART
KISSIMMEE 1996 FEE 18.4 130,983 100.0 KASH N' KARRY
LAKELAND 2001 FEE 22.9 229,383 94.0 STEIN MART
LARGO 1968 FEE 12.0 149,472 86.1 WAL-MART
LARGO 1992 FEE 29.4 215,916 96.8 PUBLIX
LARGO 1993 FEE 6.6 59,730 82.7 ROCK N HORSE
LAUDERDALE LAKES 1968 JOINT VENTURE 10.0 115,341 96.9 SAVE-A-LOT
LAUDERHILL 1978 FEE 17.8 181,476 90.9 SMART & FINAL
LEESBURG 1969 GROUND LEASE (2017) 1.3 13,468 88.9
MARGATE 1993 FEE 34.1 260,752 98.0 PUBLIX
MELBOURNE 1968 GROUND LEASE (2071) 11.5 168,737 96.5 SUBMITTORDER CO
MELBOURNE 1994 FEE 13.8 131,851 75.7 TEGGE FURNISHINGS
MELBOURNE 1998 FEE 13.2 148,660 86.7 KROGER
MELBOURNE (9) 1987 JOINT VENTURE 11.9 118,828 86.0 PUBLIX
MIAMI 1968 FEE 8.2 104,968 99.9 KMART
MIAMI 1962 JOINT VENTURE 14.0 79,273 100.0 BABIES R US
MIAMI 1986 FEE 7.8 83,380 97.5 PUBLIX
MIAMI 1995 FEE 5.4 63,604 100.0 KIDS R US
MIAMI 1985 FEE 15.9 108,795 100.0 PUBLIX
MOUNT DORA 1997 FEE 12.4 118,150 100.0 KMART
OCALA 1997 FEE 27.2 254,459 89.1 KMART
ORANGE PARK 2003 JOINT VENTURE 5.0 50,299 100.0 BED BATH & BEYOND
ORLANDO 1968 FEE 12.0 131,646 96.6 BED BATH & BEYOND
ORLANDO (7) 2000 FEE 18.0 179,065 97.1 KMART
ORLANDO 1968 JOINT VENTURE 10.0 114,434 100.0 BALLY TOTAL FITNESS
ORLANDO 1968 GROUND LEASE (2047)/JOINT VENTURE 7.8 110,788 100.0 OFFICE FURNITURE
ORLANDO 1994 FEE 28.0 236,486 98.4 OLD TIME POTTERY
ORLANDO 1996 FEE 11.7 129,256 100.0 ROSS STORES
PALATKA 1970 FEE 8.9 82,730 58.3 BIG LOTS
PANAMA CITY (4) 2002 JOINT VENTURE 8.3 50,000 100.0 ROSS STORES
PENSACOLA (9) 2002 JOINT VENTURE 18.2 189,287 76.3 WINN DIXIE
PLANTATION 1974 JOINT VENTURE 4.6 60,414 100.0 BREAD OF LIFE
POMPANO BEACH 1968 JOINT VENTURE 6.6 66,838 100.0 RAMP 48
PORT RICHEY (7) 1998 FEE 14.3 103,294 91.8 CIRCUIT CITY
RIVIERA BEACH 1968 JOINT VENTURE 5.1 46,390 78.7 FURNITURE KINGDOM
SANFORD 1989 FEE 40.9 157,547 92.9 ROSS STORES
SARASOTA 1970 FEE 10.0 102,455 100.0 TJ MAXX
SARASOTA 1989 FEE 12.0 129,700 97.3 KASH N' KARRY
ST. PETERSBURG 1968 GROUND LEASE (2084)/JOINT VENTURE 9.0 118,979 86.6 KASH N' KARRY
TALLAHASSEE 1998 FEE 12.8 105,535 95.6 STEIN MART
TALLAHASSEE (4) 2000 GROUND LEASE (2085)/JOINT VENTURE 34.0 225,000 100.0 BED BATH & BEYOND
TAMPA 2003 JOINT VENTURE 7.5 75,297 100.0 AMERICAN SIGNATURE HOME
TAMPA 1997 FEE 16.3 127,837 95.1 STAPLES
TAMPA (7) 2001 FEE 73.0 335,593 96.4 BEST BUY
TAMPA (4) 2001 JOINT VENTURE 30.9 97,000 100.0 MARSHALLS
WEST PALM BEACH (9) 2002 JOINT VENTURE 11.9 119,443 90.8 WINN DIXIE
WEST PALM BEACH 1995 FEE 7.9 80,845 100.0 BABIES R US
WEST PALM BEACH 1967 JOINT VENTURE 7.6 77,286 100.0 WINN DIXIE
WINTER HAVEN 1973 JOINT VENTURE 13.9 92,428 88.9 BIG LOTS
GEORGIA
ATLANTA 1988 FEE 19.5 165,314 100.0 SCOTT ANTIQUES
AUGUSTA 1995 FEE 11.3 122,350 74.9 TJ MAXX
AUGUSTA (7) 2001 FEE 49.9 531,046 98.3 SPORTS AUTHORITY
GAINSVILLE 1993 JOINT VENTURE 12.6 142,468 100.0 FARMERS FURNITURE
MACON 1969 FEE 12.3 127,260 45.0 FREDS STORES
MARIETTA (9) 2002 GROUND LEASE (2048)/JOINT VENTURE 15.2 151,820 83.3 INGLES SUBLEASE
SAVANNAH 1993 FEE 22.2 187,076 99.1 BED BATH & BEYOND
SAVANNAH 1995 GROUND LEASE (2045) 9.5 88,325 100.0 MEDIA PLAY
SNELLVILLE (7) 2001 FEE 35.6 311,033 100.0 KOHLS
ILLINOIS
ADDISON 1968 GROUND LEASE (2066) 8.0 93,289 45.6 DINOREX
ALTON 1986 FEE 21.2 159,824 82.1 VALUE CITY
ARLINGTON HEIGHTS 1998 FEE 7.0 80,040 -
AURORA 1998 FEE 17.9 91,182 -
BATAVIA (7) 2002 FEE 31.7 272,416 98.6 KOHLS
BELLEVILLE 1987 GROUND LEASE (2057) 20.3 81,490 100.0 KMART
BLOOMINGTON 1972 FEE 16.1 188,250 100.0 SCHNUCK MARKETS
BLOOMINGTON 2003 JOINT VENTURE 11.0 73,951 97.5
BRADLEY 1996 FEE 5.4 80,535 100.0 CARSON PIRIE SCOTT
CALUMET CITY 1997 FEE 17.0 197,949 34.1 MARSHALLS
CARBONDALE 1997 GROUND LEASE (2052) 8.1 80,535 100.0 K'S MERCHANDISE
CHAMPAIGN (7) 2001 FEE 9.3 111,720 100.0 BEST BUY
CHAMPAIGN 1999 FEE 9.0 102,615 100.0 K'S MERCHANDISE
CHICAGO (6) 1997 FEE 13.4 109,441 -
CHICAGO 1997 GROUND LEASE (2040) 17.5 104,264 100.0 GOLDBLATT'S
CHICAGO 1997 FEE 6.0 86,894 100.0 KMART
CHICAGO 1988 FEE 6.4 95,951 -
COUNTRYSIDE 1997 GROUND LEASE (2053) 27.7 117,005 100.0 HOME DEPOT
CRESTWOOD 1997 GROUND LEASE (2051) 36.8 79,903 100.0 KMART
CRYSTAL LAKE 1998 FEE 6.1 80,390 100.0 HOBBY LOBBY
DOWNERS GROVE 1998 FEE 7.2 192,639 100.0 HOME DEPOT EXPO
DOWNERS GROVE 1999 FEE 24.8 144,670 97.2 DOMINICK'S
DOWNERS GROVE 1997 FEE 12.0 141,906 100.0 TJ MAXX
ELGIN 1972 FEE 18.7 186,432 94.6 ELGIN MALL
FAIRVIEW HEIGHTS 1986 GROUND LEASE (2050) 19.1 192,073 100.0 KMART
FOREST PARK 1997 GROUND LEASE (2021) 9.3 98,371 100.0 KMART
GENEVA 1996 FEE 8.2 104,688 100.0 GANDER MOUNTAIN
MATTESON 1997 FEE 17.0 157,852 96.3 SPORTMART
MOUNT PROSPECT 1997 FEE 16.8 192,789 98.4 KOHLS
MUNDELIEN 1991 FEE 7.6 89,692 100.0 BURLINGTON COAT FACTORY
NAPERVILLE 1997 FEE 9.0 102,327 100.0 BURLINGTON COAT FACTORY
MAJOR LEASES
---------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- --------------------------------------------------------------------------------------------------------------------------------
JENSEN BEACH 2010 2070 MARSHALLS 2005 2020
KEY LARGO (7) 2014 2064 PUBLIX 2009 2029 BEALLS OUTLET 2005 2011
KISSIMMEE 2006 2036 OFFICEMAX 2012 2027 JO-ANN FABRICS 2006 2016
LAKELAND 2006 2026 AMC THEATRES 2007 2017 ROSS STORES 2007 2012
LARGO 2007 2027
LARGO 2009 2029 AMC THEATRES 2011 2036 OFFICE DEPOT 2004 2019
LARGO 2006 2012
LAUDERDALE LAKES 2007 2017 THINK THRIFT 2007 2017
LAUDERHILL 2017 WORLD JEWELRY CENTER 2014 2024 BABIES R US 2004 2014
LEESBURG
MARGATE 2008 2028 OFFICE DEPOT 2005 2020 SAM ASH MUSIC 2006 2011
MELBOURNE 2010 2022 JO-ANN FABRICS 2006 2016 WALGREENS 2045
MELBOURNE 2005 2007 GOODWILL INDUSTRIES 2004 2010 SAVE-A-LOT 2013 2023
MELBOURNE 2004 2034 SERVICE MERCHANDISE 2005 2035 BED BATH & BEYOND 2013 2028
MELBOURNE (9) 2007 WALGREENS 2027
MIAMI 2009 2029 MILAM'S MARKET 2004 2008 WALGREENS 2009
MIAMI 2006 2021 FIRESTONE TIRE 2004 2009
MIAMI 2009 2029 WALGREENS 2018
MIAMI 2016 2021 PARTY CITY 2007 2017
MIAMI 2019 2039 WALGREENS 2058
MOUNT DORA 2013 2063
OCALA 2006 2021 BEST BUY 2019 2034 SERVICE MERCHANDISE 2007 2032
ORANGE PARK 2015 MICHAELS 2010
ORLANDO 2007 2022 BOOKS-A-MILLION 2006 2016 OFFICEMAX 2008 2023
ORLANDO (7) 2014 2064 PUBLIX 2012 2037
ORLANDO 2008 2018 HSN 2004 BEDDING & FURNITURE DISCOUNT 2009
ORLANDO 2008 VALUE THRIFT 2004
ORLANDO 2010 2020 SPORTS AUTHORITY 2011 2031 SAND LAKE THEATER 2008
ORLANDO 2008 2028 BIG LOTS 2009 WORLD GYM 2010 2020
PALATKA 2007 2017
PANAMA CITY (4) 2014 2034 BED BATH & BEYOND 2013 2028
PENSACOLA (9) 2012 2037 PARTY CITY 2013 2023 BEALLS OUTLET 2006 2016
PLANTATION 2009 2019 WHOLE FOODS 2009 2019
POMPANO BEACH 2004 2009
PORT RICHEY (7) 2011 2031 STAPLES 2006 2011 MICHAELS 2006
RIVIERA BEACH 2009 2014 GOODWILL INDUSTRIES 2005 2008
SANFORD 2012 2032 OFFICE DEPOT 2009 2019 ECKERD 2005 2025
SARASOTA 2007 2017 OFFICEMAX 2009 2024 FRANK'S NURSERY 2012 2032
SARASOTA 2020 2040 DG ACE HARDWARE 2008 2023 ANTHONY'S LADIES WEAR 2007 2017
ST. PETERSBURG 2017 2037 TJ MAXX 2007 2012 DOLLAR TREE 2007 2022
TALLAHASSEE 2008 2008 BEN FRANKLIN 2007 2022 SHOE STATION 2007 2012
TALLAHASSEE (4) 2017 2032 SPORTS AUTHORITY 2008 2034 MARSHALLS 2011 2021
TAMPA 2019 DSW SHOE WAREHOUSE 2018 2033
TAMPA 2008 2018 ROSS STORES 2007 2022 US POST OFFICE 2006 2021
TAMPA (7) 2016 2031 JO-ANN FABRICS 2016 2031 BED BATH & BEYOND 2015 2030
TAMPA (4) 2013 2028 PETCO 2012 2026
WEST PALM BEACH (9 2017 2042 WALGREENS 2018 2058
WEST PALM BEACH 2006 2021
WEST PALM BEACH 2010 2030
WINTER HAVEN 2005 2010 JO-ANN FABRICS 2006 2016 FAMILY DOLLAR 2007 2022
GEORGIA
ATLANTA 2005
AUGUSTA 2010 2015 ROSS STORES 2013 2033 RUGGED WEARHOUSE 2008 2018
AUGUSTA (7) 2012 2027 MANSOUR'S 2020 2040 BED BATH & BEYOND 2013 2028
GAINSVILLE 2008 2013 BIG LOTS 2012 OFFICE DEPOT 2004 2020
MACON 2009 2014
MARIETTA (9) 2004 2024
SAVANNAH 2013 2028 TJ MAXX 2005 2015 MARSHALLS 2007 2022
SAVANNAH 2006 2021 STAPLES 2015 2030 WEST MARINE 2004 2014
SNELLVILLE (7) 2022 2062 BELK'S STORE 2015 2035 LINENS N THINGS 2015 2030
ILLINOIS
ADDISON 2014 2024 $DOLLAR PALACE 2008 2013
ALTON 2008 2023
ARLINGTON HEIGHTS
AURORA
BATAVIA (7) 2019 2049 HOBBY LOBBY 2009 2019 LINENS N THINGS 2014 2029
BELLEVILLE 2024 2054
BLOOMINGTON 2014 2029 TOYS "R" US 2015 2045 BARNES & NOBLE 2005 2015
BLOOMINGTON
BRADLEY 2014 2034
CALUMET CITY 2008 BEST BUY 2012 2032
CARBONDALE 2012 2052
CHAMPAIGN (7) 2016 2031 DICK'S SPORTING GOODS 2016 2031 MICHAELS 2010 2025
CHAMPAIGN 2014 2034
CHICAGO (6)
CHICAGO 2005 2025 JB GRUBART 2005 2013 FASHION ISLAND 2005
CHICAGO 2024 2054
CHICAGO
COUNTRYSIDE 2023 2053
CRESTWOOD 2024 2051
CRYSTAL LAKE 2009 2019 DINOREX 2012 2022
DOWNERS GROVE 2022 2062 RHODES FURNITURE 2008 2018
DOWNERS GROVE 2009 2019 DOLLAR TREE 2008 2023 WALGREENS 2022
DOWNERS GROVE 2009 2024 BEST BUY 2016 2031
ELGIN 2013 2023 ELGIN FARMERS PRODUCTS 2010 2030
FAIRVIEW HEIGHTS 2024 2050 OFFICEMAX 2015 2025 WALGREENS 2010 2029
FOREST PARK 2021
GENEVA 2013 2028
MATTESON 2014 2029 MARSHALLS 2010 2025 LINENS N THINGS 2014 2029
MOUNT PROSPECT 2024 2054 HOBBY LOBBY 2016 2026 POOL-A-RAMA 2010 2017
MUNDELIEN 2018 2033
NAPERVILLE 2013 2033
21
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
NORRIDGE 1997 GROUND LEASE (2042) 11.7 116,914 100.0 KMART
OAKBROOK TERRACE 1997 FEE 15.6 164,903 100.0 HOME DEPOT
OAKLAWN 1997 FEE 15.4 165,337 100.0 KMART
ORLAND PARK 1998 FEE 7.8 166,000 100.0 RHODES FURNITURE
ORLAND PARK 1980 FEE 18.8 131,546 100.0 VALUE CITY
OTTAWA 1970 FEE 9.0 60,000 100.0 VALUE CITY
PEORIA 1997 GROUND LEASE (2031) 20.5 156,067 100.0 KMART
ROLLING MEADOWS 2003 FEE 3.7 37,225 100.0 FAIR LANES ROLLING MEADOWS
SCHAUMBURG 2003 JOINT VENTURE 63.0 629,605 90.0 GALYAN'S TRADING COMPANY
SCHAUMBURG 1998 FEE 7.3 167,690 100.0 RHODES FURNITURE
SKOKIE 1997 FEE 5.8 58,455 100.0 MARSHALLS
STREAMWOOD 1999 FEE 5.6 81,000 100.0 VALUE CITY
WAUKEGAN 1998 FEE 6.8 90,555 100.0 PICK N SAVE
WOODRIDGE 1998 FEE 13.1 161,272 90.7 HOLLYWOOD THEATRES
INDIANA
EVANSVILLE 1986 FEE 14.2 194,489 88.1 BURLINGTON COAT FACTORY
EVANSVILLE 1986 FEE 11.5 149,182 10.6
FELBRAM 1970 FEE 4.1 27,400 100.0 SAVE-A-LOT
GREENWOOD 1970 FEE 25.7 168,577 100.0 BABY SUPERSTORE
GRIFFITH 1997 GROUND LEASE (2054) 10.6 114,684 100.0 KMART
INDIANAPOLIS 1963 JOINT VENTURE 17.4 165,220 99.3 KROGER
INDIANAPOLIS 1986 FEE 20.6 185,589 98.1 TARGET
LAFAYETTE 1971 FEE 12.4 90,500 97.3 MENARD
LAFAYETTE 1997 FEE 24.3 183,440 53.7 PAYLESS SUPERMARKET
LAFAYETTE 1998 FEE 43.2 214,876 99.3 FAMOUS FOOTWEAR
MISHAWAKA 1998 FEE 7.5 82,100 100.0 K'S MERCHANDISE
SOUTH BEND 2003 JOINT VENTURE 25.7 257,155 92.6
SOUTH BEND 1999 FEE 1.8 81,668 100.0 MENARD
IOWA
CLIVE 1996 FEE 8.8 90,000 100.0 KMART
CLIVE (8) 2002 JOINT VENTURE 23.0 109,434 87.2 BABIES R US
DAVENPORT 1997 GROUND LEASE (2028) 9.1 91,035 100.0 KMART
DES MOINES 1999 FEE 23.0 156,506 73.6 BEST BUY
DUBUQUE 1997 GROUND LEASE (2019) 6.5 82,979 100.0 SHOPKO
SE DES MOINES 1996 FEE 9.6 111,847 100.0 HOME DEPOT
WATERLOO 1996 FEE 9.0 96,000 -
KANSAS
E. WICHITA (7) 1996 FEE 6.5 96,011 100.0 DICK'S SPORTING GOODS
OVERLAND PARK 1980 FEE 14.5 120,164 100.0 HOME DEPOT
W. WICHITA (7) 1996 FEE 8.1 96,319 100.0 SHOPKO
WICHITA (7) 1998 FEE 13.5 133,771 97.3 BEST BUY
KENTUCKY
BELLEVUE 1976 FEE 6.0 53,695 100.0 KROGER
FLORENCE 2003 FEE 8.2 99,578 97.8 DICK'S SPORTING GOODS
HINKLEVILLE 1998 GROUND LEASE (2039) 2.0 85,229 100.0 K'S MERCHANDISE
LEXINGTON 1993 FEE 35.8 258,713 100.0 BEST BUY
LOUISIANA
BATON ROUGE 1997 FEE 18.6 350,006 87.4 BURLINGTON COAT FACTORY
HARVEY (8) 2003 JOINT VENTURE 17.4 181,660 100.0 BEST BUY
HOUMA 1999 FEE 10.1 98,586 94.4 OLD NAVY
LAFAYETTE 1997 FEE 21.9 244,733 98.3 STEIN MART
NEW ORLEANS 1983 JOINT VENTURE 7.0 190,000 100.0 DILLARDS
MAINE
BANGOR 2001 FEE 8.6 86,422 100.0 BURLINGTON COAT FACTORY
MARYLAND
BALTIMORE 2003 FEE 4.2 44,170 90.0
BALTIMORE 2003 FEE 18.4 152,834 100.0 KMART
BALTIMORE 2003 FEE 10.6 115,450 92.6 SAFEWAY
BALTIMORE 2003 FEE 5.8 49,629 100.0 CORT FURNITURE RENTAL
BALTIMORE 2003 FEE 9.2 90,622 94.8 SUPER FRESH
BALTIMORE 2003 FEE 7.3 77,287 100.0 SUPER FRESH
BALTIMORE 2003 FEE 7.4 77,290 100.0 GIANT FOOD
BALTIMORE 2003 FEE 7.5 90,903 97.8 GIANT
BEL AIR 2003 FEE 19.7 121,363 100.0 SAFEWAY
BEL AIR 2003 FEE 2.7 26,900 79.2
CLINTON 2003 FEE 0.3 2,544 100.0
CLINTON 2003 GROUND LEASE (2069) 2.6 26,412 100.0 FAIR LANES CLINTON
COLUMBIA (8) 2002 JOINT VENTURE 7.6 73,299 100.0 OLD NAVY
COLUMBIA (8) 2002 JOINT VENTURE 5.9 58,662 100.0 PARTY PARTY PARTY
COLUMBIA (8) 2002 JOINT VENTURE 15.5 86,456 100.0 GIANT FOOD
COLUMBIA (8) 2002 JOINT VENTURE 16.3 100,505 100.0 GIANT FOOD
COLUMBIA (8) 2002 JOINT VENTURE 12.2 86,032 95.6 SAFEWAY
COLUMBIA (8) 2002 JOINT VENTURE 12.3 91,165 100.0 SAFEWAY
COLUMBIA 2002 FEE 7.3 52,291 100.0 GIANT FOOD
COLUMBIA 2002 FEE 2.5 23,835 98.5
COLUMBIA (8) 2002 JOINT VENTURE 7.0 87,597 100.0 SAFEWAY
COLUMBIA 2002 FEE 6.1 58,224 100.0 FOOD LION
COLUMBIA (8) 2002 JOINT VENTURE 15.2 101,707 100.0 GIANT FOOD
COLUMBIA 2002 JOINT VENTURE 5.0 50,000 100.0 MICHAELS
EASTON 2003 FEE 11.1 113,330 100.0 GIANT FOOD
ELLICOTT CITY 2003 FEE 31.8 139,898 100.0 SAFEWAY
GAITHERSBURG 1989 FEE 8.7 87,061 100.0 GREAT BEGINNINGS FURNITURE
GLEN BURNIE 1997 GROUND LEASE (2034) 6.0 60,173 100.0 ROOMSTORE
GLEN BURNIE 2003 FEE 21.9 249,746 100.0 LOWE'S HOME CENTER
GLEN BURNIE 2003 FEE 4.5 75,185 83.1 SEVERN GRAPHICS
GLEN BURNIE 2003 FEE 1.9 18,823 71.1
HAGERSTOWN 1973 FEE 10.5 117,718 91.3 AMES
HUNT VALLEY 2003 FEE 9.1 94,653 94.8 GIANT
LANDOVER 1993 FEE 23.3 232,903 100.0 RAYTHEON
LAUREL 1964 FEE 8.1 75,924 100.0 VILLAGE THRIFT
LAUREL 1972 FEE 10.0 81,550 -
LINTHICUM 2003 FEE 0.4 5,488 100.0
MAJOR LEASES
---------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- --------------------------------------------------------------------------------------------------------------------------------
NORRIDGE 2024 2042
OAKBROOK TERRACE 2024 2044 LINENS N THINGS 2017 2032 LOYOLA UNIV. MEDICAL CENTER 2006 2016
OAKLAWN 2024 2054 CHUCK E CHEESE 2007
ORLAND PARK 2008 2018 RHODES FURNITURE 2008 2018
ORLAND PARK 2015 2030
OTTAWA 2006 2011
PEORIA 2024 2031 MARSHALLS 2009 2024
ROLLING MEADOWS 2008 2013
SCHAUMBURG 2014 2039 CARSON PIRIE SCOTT 2021 2071 LOEWS THEATRE 2019 2039
SCHAUMBURG 2008 2018 RHODES FURNITURE 2008 2018
SKOKIE 2010 2025 OLD NAVY 2010 2015
STREAMWOOD 2015 2030
WAUKEGAN 2009 2029
WOODRIDGE 2012 2022 KOHLS 2010 2030 MCSPORTS 2006
INDIANA
EVANSVILLE 2007 2027 OFFICEMAX 2012 2027 MICHAELS 2005 2020
EVANSVILLE
FELBRAM 2006 2016
GREENWOOD 2006 2021 TOYS "R" US 2011 2056 TJ MAXX 2010 2010
GRIFFITH 2024 2054
INDIANAPOLIS 2026 2066 AJ WRIGHT 2012 2027 CVS 2021 2031
INDIANAPOLIS 2009 2029 DOLLAR TREE 2004 2014 RAINBOW SHOPS 2009 2019
LAFAYETTE 2006
LAFAYETTE 2004 2014 JO-ANN FABRICS 2010 2020 SMITH OFFICE EQUIPMENT 2008
LAFAYETTE 2011 2026 PETSMART 2012 2032 STAPLES 2011 2026
MISHAWAKA 2013 2023
SOUTH BEND
SOUTH BEND 2010 2030
IOWA
CLIVE 2021 2051
CLIVE (8) 2015 2040 JO-ANN FABRICS 2013 2023 DAVID'S BRIDAL 2011 2021
DAVENPORT 2024 2028
DES MOINES 2008 2023 OFFICEMAX 2008 2018 JO-ANN FABRICS 2007 2017
DUBUQUE 2018
SE DES MOINES 2020 2065
WATERLOO
KANSAS
E. WICHITA (7) 2018 2033 GORDMANS 2012 2032
OVERLAND PARK 2005 2050
W. WICHITA (7) 2018 2038
WICHITA (7) 2010 2025 TJ MAXX 2004 2019 MICHAELS 2005 2025
KENTUCKY
BELLEVUE 2005 2035
FLORENCE 2018 2033 LINEN'S AND THINGS 2018 2033 MCSWAIN CARPETS 2012 2017
HINKLEVILLE 2014 2039
LEXINGTON 2009 2024 BED BATH & BEYOND 2013 2038 TOYS "R" US 2013 2038
LOUISIANA
BATON ROUGE 2004 2024 STEIN MART 2006 2016 THE RUG GALLERY 2004 2009
HARVEY (8) 2017 2032 LINENS N THINGS 2012 2032 BARNES & NOBLE 2012 2022
HOUMA 2009 2014 OFFICEMAX 2013 2028 MICHAELS 2009 2019
LAFAYETTE 2005 2020 LINENS N THINGS 2009 2024 TJ MAXX 2009 2019
NEW ORLEANS 2011 2031
MAINE
BANGOR 2007 2032
MARYLAND
BALTIMORE
BALTIMORE 2005 2055 SALVO AUTO PARTS 2004 2019
BALTIMORE 2016 2046 RITE AID 2006 2026 FOOT LOCKER 2007
BALTIMORE 2012 2022
BALTIMORE 2020 2060 RITE AID 2007 2017
BALTIMORE 2021 2061
BALTIMORE 2006 2031
BALTIMORE 2026 2051
BEL AIR 2030 2060 CVS 2021 2041
BEL AIR
CLINTON
CLINTON 2006
COLUMBIA (8) 2008 2013
COLUMBIA (8) 2007 2012
COLUMBIA (8) 2009 2019
COLUMBIA (8) 2012 2022
COLUMBIA (8) 2006
COLUMBIA (8) 2018 2043
COLUMBIA 2007
COLUMBIA
COLUMBIA (8) 2018 2048
COLUMBIA 2018 2043
COLUMBIA (8) 2017 2027
COLUMBIA 2013 HOME GOODS 2011
EASTON 2024 2054 FASHION BUG 2005 2025
ELLICOTT CITY 2012 2042 PETCO 2006 2021
GAITHERSBURG 2011 2021 FURNITURE 4 LESS 2005 2010
GLEN BURNIE 2004
GLEN BURNIE 2019 2059 GIANT FOOD 2005 2025
GLEN BURNIE 2005 2012
GLEN BURNIE
HAGERSTOWN 2007 2017 SUPER SHOE 2006 2016 ADVANCE AUTO PARTS 2006 2011
HUNT VALLEY 2013 2033
LANDOVER 2007 2010
LAUREL 2004 2009 DOLLAR TREE 2010 2015 OLD COUNTRY BUFFET 2009 2019
LAUREL
LINTHICUM
22
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
LUTHERVILLE 2003 GROUND LEASE (2066) 12.9 122,289 100.0 METRO FOOD
LUTHERVILLE 2003 FEE 1.2 12,333 86.7
NORTH EAST 2003 FEE 17.5 80,190 100.0 FOOD LION
OWINGS MILLS 2003 FEE 11.0 116,303 95.9 GIANT FOOD
PASADENA 2003 GROUND LEASE (2030) 3.0 41,241 96.5
PERRY HALL 2003 FEE 15.7 204,770 77.2 BRUNSWICK BOWLING
PERRY HALL 2003 FEE 8.2 65,059 100.0 SUPER FRESH
TIMONIUM 2003 FEE 6.0 59,829 94.5 AMERICAN RADIOLOGY
TIMONIUM 2003 FEE 17.2 206,729 91.1
TOWSON 2003 FEE 8.7 82,280 100.0 LINENS N THINGS
WALDORF 2003 FEE 2.6 26,128 100.0 FAIR LANES WALDORF
WALDORF 2003 FEE 0.5 4,500 100.0
WOODSTOCK 2003 FEE 13.9 103,547 100.0 WEIS MARKETS
MASSACHUSETTS
FOXBOROUGH (7) 2000 FEE 11.9 118,844 94.2 STOP & SHOP
GREAT BARRINGTON 1994 FEE 14.1 131,235 98.5 KMART
PITTSFIELD 2003 FEE 13.0 72,014 100.0 STOP & SHOP
SHREWSBURY 1955 FEE 10.8 108,418 100.0 BOB'S STORES
MICHIGAN
CLARKSTON 1996 FEE 20.0 168,102 96.7 FARMER JACK
CLAWSON 1993 FEE 13.5 179,572 100.0 FARMER JACK
FARMINGTON 1993 FEE 2.8 96,983 100.0 DAMMAN HARDWARE
FLINT 1989 FEE 46.6 248,347 82.3 KESSEL FOOD MARKETS
KALAMAZOO 2002 JOINT VENTURE 60.0 339,975 64.3 HOBBY LOBBY
LIVONIA 1968 FEE 4.5 44,185 100.0 DAMMAN HARDWARE
MUSKEGON 1985 FEE 12.2 79,215 100.0 PLUMB'S FOOD
NORTON SHORES (4) 2003 JOINT VENTURE 37.1 26,000 100.0 SHOE CARNIVAL
NOVI 2003 JOINT VENTURE 6.0 60,000 100.0 MICHAELS
TAYLOR 1993 FEE 13.0 141,549 100.0 KOHLS
WALKER 1993 FEE 41.8 338,928 100.0 RUBLOFF DEVELOPMENT
MINNESOTA
MAPLE GROVE (7) 2001 FEE 63.0 466,401 100.0 BYLERLY'S
MAPLEWOOD (8) 2002 JOINT VENTURE 8.2 96,376 100.0 BEST BUY
MINNETONKA (7) 1998 FEE 12.1 120,220 100.0 TOYS "R" US
MISSISSIPPI
JACKSON 2002 JOINT VENTURE 5.0 50,000 100.0 MICHAELS
MISSOURI
BRIDGETON 1997 GROUND LEASE (2040) 27.3 101,592 100.0 KOHLS
CAPE GIRARDEAU 1997 GROUND LEASE (2060) 7.0 80,803 -
CREVE COEUR 1998 FEE 12.2 113,781 100.0 KOHLS
ELLISVILLE 1970 FEE 18.4 118,080 100.0 SHOP N SAVE
HAZELWOOD (3) 1970 FEE 16.8 149,230 16.3 WALGREENS
INDEPENDENCE 1985 FEE 21.0 184,870 100.0 KMART
JOPLIN 1998 FEE 12.6 155,416 100.0 GOODY'S FAMILY CLOTHING
JOPLIN (7) 1998 FEE 9.5 80,524 100.0 SHOPKO
KANSAS CITY 1997 FEE 17.8 150,381 82.3 HOME DEPOT
KIRKWOOD 1980 GROUND LEASE (2069) 19.8 254,638 100.0 HEMISPHERES
LEMAY 1974 GROUND LEASE (2073) 3.1 73,281 100.0 SHOP N SAVE
MANCHESTER (7) 1998 FEE 9.6 89,305 100.0 KOHLS
SPRINGFIELD 1994 FEE 41.5 282,360 97.6 BEST BUY
SPRINGFIELD 1986 GROUND LEASE (2087) 18.5 202,926 100.0 KMART
SPRINGFIELD (3) 2002 FEE 8.5 84,916 100.0 BED BATH & BEYOND
ST. CHARLES (5) 1998 FEE 36.9 8,000 100.0
ST. CHARLES 1999 GROUND LEASE (2039) 8.4 84,460 100.0 KOHLS
ST. LOUIS 1972 FEE 13.1 129,093 91.7 SHOP N SAVE
ST. LOUIS 1986 FEE 17.5 176,333 60.7 BURLINGTON COAT FACTORY
ST. LOUIS 1997 GROUND LEASE (2025) 19.7 193,875 96.7 HOME DEPOT
ST. LOUIS 1997 GROUND LEASE (2035) 37.7 174,967 98.4 KMART
ST. LOUIS 1997 GROUND LEASE (2040) 16.3 128,765 100.0 KMART
ST. PETERS 1997 FEE 14.8 154,533 98.4 HOBBY LOBBY
NEVADA
HENDERSON (4) 1999 JOINT VENTURE 32.1 99,000 100.0 LEVITZ
LAS VEGAS (7) 2000 FEE 22.9 234,496 98.5 RODEO DISCOUNT MALL
NEW HAMPSHIRE
NASHUA 2003 FEE 18.0 179,582 90.5 DSW SHOE WAREHOUSE
SALEM 1994 FEE 39.8 344,076 100.0 KOHLS
NEW JERSEY
BRIDGEWATER (7) 2001 FEE 15.8 370,545 100.0 BED BATH & BEYOND
CHERRY HILL 1985 JOINT VENTURE 18.6 124,750 92.3 SUPER G
CHERRY HILL 1996 GROUND LEASE (2035) 15.2 129,809 95.5 KOHLS
CHERRY HILL (8) 2003 FEE 48.0 209,185 100.0 KOHLS
CINNAMINSON 1996 FEE 13.7 121,852 36.1 ODD-JOB
DELRAN (7) 2000 FEE 16.1 161,128 37.3 EICKHOFF SUPERMARKETS
EAST WINDSOR 2002 FEE 34.8 242,729 99.3 TARGET
FRANKLIN 1998 FEE 14.9 138,364 90.4 EDWARDS
HOLMDEL 2002 FEE 29.7 296,807 73.2 A&P
LINDEN 2002 FEE 0.9 13,340 100.0 STRAUSS DISCOUNT AUTO
NORTH BRUNSWICK 1994 FEE 38.1 409,879 100.0 WAL-MART
PISCATAWAY 1998 FEE 9.6 97,348 98.0 SHOPRITE
PLAINFIELD (7) 1998 FEE 16.2 136,939 97.9 A&P
RIDGEWOOD 1994 FEE 2.7 24,280 100.0 FRESH FIELDS
WESTMONT 1994 FEE 17.4 192,254 87.8 SUPER FRESH
NEW MEXICO
ALBUQUERQUE 1998 FEE 4.7 37,735 85.1 SEARS HARDWARE
ALBUQUERQUE 1998 FEE 26.0 183,912 94.5 MOVIES WEST
ALBUQUERQUE 1974 FEE 4.8 59,722 98.0 PAGE ONE
NEW YORK
ALBANY 2003 FEE 17.9 135,831 93.7 PRICE CHOPPER
BRIDGEHAMPTON 1973 FEE 30.2 287,587 98.7 KMART
BRONX 1990 JOINT VENTURE 22.9 228,638 100.0 NATIONAL AMUSEMENTS
BROOKLYN (7) 2000 FEE 8.1 80,708 100.0 HOME DEPOT
BROOKLYN 2003 FEE 0.8 7,500 100.0
MAJOR LEASES
---------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- --------------------------------------------------------------------------------------------------------------------------------
LUTHERVILLE 2018 2038 CIRCUIT CITY 2010 2030 LOEHMANN'S 2005 2016
LUTHERVILLE
NORTH EAST 2018 2038
OWINGS MILLS 2020 2045 MERRITT ATHLETIC CLUB 2005 2015
PASADENA
PERRY HALL 2005 2010 FRANK'S NURSERY 2008 2013 RITE AID 2005 2035
PERRY HALL 2022 2062
TIMONIUM 2012 2027
TIMONIUM
TOWSON 2015 2025 COMPUSA 2014 2029 TWEETER ENTERTAINMENT 2014 2024
WALDORF 2007 2017
WALDORF
WOODSTOCK 2021 2041
MASSACHUSETTS
FOXBOROUGH (7) 2012 2022 OCEAN STATE JOB 2007 2022
GREAT BARRINGTON 2006 2016 PRICE CHOPPER 2016 2036
PITTSFIELD 2014 2044
SHREWSBURY 2018 2033 BED BATH & BEYOND 2012 2032 STAPLES 2006 2021
MICHIGAN
CLARKSTON 2015 2045 FRANK'S NURSERY 2011 2031 CVS 2005 2020
CLAWSON 2006 2016 FRANK'S NURSERY 2016 STAPLES 2011 2026
FARMINGTON 2015 2030 DOLLAR CASTLE 2005 2010 BARGAIN BOOKS 2004
FLINT 2014 2034 TOP ONE DISCOUNT 2005 HURLEY MEDICAL 2010 2020
KALAMAZOO 2013 2023 FRANK'S NURSERY 2007 2012 MARSHALLS 2010 2020
LIVONIA 2018 2033 CENTURY 21 2005 2010
MUSKEGON 2007 2022 JO-ANN FABRICS 2005 2012
NORTON SHORES (4) 2015 2025
NOVI 2016 HOME GOODS 2011
TAYLOR 2022 2042 BABIES R US 2017 2043 PARTY CONCEPTS 2007 2012
WALKER 2016 2051 KOHLS 2017 2037 LOEKS THEATRES 2007 2042
MINNESOTA
MAPLE GROVE (7) 2020 2035 BEST BUY 2015 2030 JO-ANN FABRICS 2010 2030
MAPLEWOOD (8) 2014 2029 FRANK'S NURSERY 2011 2031
MINNETONKA (7) 2016 2031 GOLFSMITH 2008 2018 OFFICEMAX 2006 2011
MISSISSIPPI
JACKSON 2014 HOME GOODS 2014
MISSOURI
BRIDGETON 2010 2020
CAPE GIRARDEAU
CREVE COEUR 2018 2038 CLUB FITNESS 2014 2024
ELLISVILLE 2005 2015 LAMPS & MORE 2005
HAZELWOOD (3) 2006
INDEPENDENCE 2024 2054 THE TILE SHOP 2014 2024 OFFICE DEPOT 2012 2032
JOPLIN 2010 2015 HASTINGS BOOKS 2009 2014 OFFICEMAX 2010 2025
JOPLIN (7) 2018 2038
KANSAS CITY 2005 2050
KIRKWOOD 2012 2022 HOBBY LOBBY 2014 2024 GART SPORTS 2014 2029
LEMAY 2008 ST. LOUIS SALES 2006 2011 DOLLAR GENERAL 2008
MANCHESTER (7) 2018 2038
SPRINGFIELD 2011 2026 JC PENNEY 2005 2015 TJ MAXX 2006 2021
SPRINGFIELD 2024 2054 OFFICE DEPOT 2005 2010 BARNES & NOBLE 2017 2047
SPRINGFIELD (3) 2013 2028 MARSHALLS 2012 2027 BORDERS BOOKS 2023 2038
ST. CHARLES (5)
ST. CHARLES 2019 2039
ST. LOUIS 2017 2082
ST. LOUIS 2004 2024 OFFICE DEPOT 2005 2015
ST. LOUIS 2024 2025 FRANK'S NURSERY 2005 2015 WEEKENDS ONLY 2004 2009
ST. LOUIS 2024 2035 ST. LOUIS DANCER'S ACADEMY 2006
ST. LOUIS 2024 2040
ST. PETERS 2013 2023 GART SPORTS 2014 2029 OFFICE DEPOT 2019
NEVADA
HENDERSON (4) 2013 2023 INTERIOR SURROUNDINGS 2008 2013
LAS VEGAS (7) 2023 2033 ALBERTSONS 2009 2019 FACTORY 2-U STORES 2009
NEW HAMPSHIRE
NASHUA 2011 2031 BED BATH & BEYOND 2007 2032 MICHAELS 2007 2027
SALEM 2008 2013 SHAWS SUPERMARKET 2008 2038 BOB'S STORES 2011 2021
NEW JERSEY
BRIDGEWATER (7) 2010 2030 BABIES R US 2014 2039 MARSHALLS 2009 2024
CHERRY HILL 2016 2036 DOLLAR TREE 2005 2015
CHERRY HILL 2016 2036 SEARS HARDWARE 2004 2013
CHERRY HILL (8) 2018 2068 WORLDWIDE WHOLESALE 2018 2033 BABIES R US 2013 2033
CINNAMINSON 2009 2014 ACME MARKETS 2047
DELRAN (7) 2006 2016 AMC THEATERS 2004 2014
EAST WINDSOR 2027 2067 GENUARDI'S 2026 2056 TJ MAXX 2011 2026
FRANKLIN 2010 2020 NEW YORK SPORTS CLUB 2006 2016
HOLMDEL 2013 2043 MARSHALLS 2013 2028 OFFICEMAX 2009 2024
LINDEN 2023 2033
NORTH BRUNSWICK 2018 2058 BURLINGTON COAT FACTORY 2008 2013 MARSHALLS 2012 2027
PISCATAWAY 2014 2024
PLAINFIELD (7) 2018 2058 SEARS HARDWARE 2008 2028 CVS 2018 2038
RIDGEWOOD 2015 2030
WESTMONT 2017 2081 SUPER FITNESS 2009 JO-ANN FABRICS 2010 2020
NEW MEXICO
ALBUQUERQUE 2006 2021
ALBUQUERQUE 2011 2021 ROSS STORES 2006 2021 VALLEY FURNITURE 2007 2017
ALBUQUERQUE 2008 2013 WALGREENS 2027
NEW YORK
ALBANY 2007 2027 BIG LOTS 2008 2018 ECKERD 2007 2022
BRIDGEHAMPTON 2019 2039 KING KULLEN 2015 2035 TJ MAXX 2007 2017
BRONX 2011 2036 WALDBAUMS 2011 2046 OFFICE OF HEARING 2007
BROOKLYN (7) 2022 2052 WALGREENS 2030
BROOKLYN
23
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
BROOKLYN 2003 FEE 1.0 10,000 100.0 GENOVESE
BUFFALO 1988 JOINT VENTURE 9.2 141,783 87.8 TOPS SUPERMARKET
BUFFALO 1988 JOINT VENTURE 12.0 150,798 20.0 BIG LOTS
BUFFALO, AMHERST 1988 JOINT VENTURE 7.5 101,066 100.0 TOPS SUPERMARKE
CENTEREACH 1993 JOINT VENTURE 40.7 380,119 95.3 WAL-MART
COMMACK 1998 GROUND LEASE (2085) 35.7 265,409 96.4 KING KULLEN
COPIAGUE (7) 1998 FEE 15.4 163,999 100.0 HOME DEPOT
FREEPORT (7) 2000 FEE 9.6 173,031 100.0 STOP & SHOP
GLEN COVE (7) 2000 FEE 2.7 49,346 87.8 STAPLES
HAMPTON BAYS 1989 FEE 8.2 70,990 100.0 MACY'S EAST
HEMPSTEAD (7) 2000 FEE 1.4 13,905 100.0 WALGREENS
LATHAM (7) 1999 FEE 60.3 616,130 99.3 SAMS CLUB
LITTLE NECK 2003 FEE 4.5 48,275 100.0
MANHASSET (3) 1999 FEE 9.6 273,943 66.6 FILENE'S
MERRICK (7) 2000 FEE 10.8 107,871 100.0 WALDBAUMS
MIDDLETOWN (7) 2000 FEE 10.1 80,000 100.0 BEST BUY
MUNSEY PARK (7) 2000 FEE 6.0 72,748 100.0 BED BATH & BEYOND
NANUET 1984 FEE 6.0 70,632 96.3 PREMIER FITNESS
OCEANSIDE 2003 FEE 0.2 1,856 100.0
PLAINVIEW 1969 GROUND LEASE (2070) 7.0 88,222 100.0 FAIRWAY STORES
POUGHKEEPSIE 1972 FEE 20.0 167,668 99.5 STOP & SHOP
RENSSELAER 2003 FEE 13.4 132,648 87.7 PRICE CHOPPER
ROCHESTER 1988 FEE 14.9 129,238 100.0 STAPLES
ROCHESTER 1988 FEE 12.8 17,995 100.0 STAPLES
ROCHESTER 1993 FEE 18.6 185,153 36.3 TOPS SUPERMARKET
STATEN ISLAND (7) 2000 FEE 14.4 177,118 100.0 TJ MAXX
STATEN ISLAND 1989 FEE 16.7 210,875 100.0 KMART
STATEN ISLAND 1997 GROUND LEASE (2072) 7.0 101,337 99.2 WALDBAUMS
SYOSSET 1967 FEE 2.5 32,124 88.6 NEW YORK SPORTS CLUB
YONKERS(7) 2000 GROUND LEASE (2047) 6.3 56,361 97.2 STAPLES
YONKERS 1995 FEE 4.4 43,560 100.0 SHOPRITE
NORTH CAROLINA
APEX (9) 2002 JOINT VENTURE 6.7 65,834 97.6 FOOD LION
CARY (7) 2001 FEE 38.6 315,797 100.0 BJ'S
CARY 1996 FEE 8.6 86,015 100.0 BED BATH & BEYOND
CARY 1998 FEE 10.9 102,787 95.7 LOWES
CARY (9) 2002 JOINT VENTURE 18.2 182,266 78.4 WELLSPRING
CARY (8) 2003 JOINT VENTURE 13.4 133,901 98.8 CARMIKE CINEMAS
CHARLOTTE 1968 FEE 13.5 110,300 94.0 MEDIA PLAY
CHARLOTTE 1993 FEE 14.0 139,269 92.6 BI-LO
CHARLOTTE 1986 GROUND LEASE (2048) 18.5 253,979 95.0 TOYS "R" US
DURHAM (7) 2002 FEE 39.5 408,292 100.0 WAL-MART
DURHAM (4) 2002 JOINT VENTURE 21.3 96,000 100.0 KROGER
DURHAM 1996 FEE 13.2 116,186 95.9 TJ MAXX
GASTONIA 1989 FEE 24.9 240,957 84.5 HOBBY LOBBY
GREENSBORO 1999 FEE 8.2 100,794 82.0 HOBBY LOBBY
GREENSBORO (7) 1998 FEE 4.4 41,387 100.0 STAPLES
LENOIR (9) 2002 JOINT VENTURE 14.4 144,239 72.4 BI-LO
PINEVILLE 2003 JOINT VENTURE 39.1 269,710 97.4 KMART
RALEIGH (9) 2002 GROUND LEASE (2049)/JOINT VENTURE 12.3 98,208 92.4 LOWES
RALEIGH 1993 FEE 35.9 374,306 75.1 BEST BUY
RALEIGH (4) 2001 JOINT VENTURE 24.4 47,000 100.0 MARQUEE CINEMAS
RALEIGH (4) 2001 JOINT VENTURE 8.0 - -
RALEIGH (4) 2003 JOINT VENTURE 36.4 47,000 100.0 FOOD LION
RALEIGH 2001 FEE 26.0 83,965 96.7 KROGER
RALEIGH (9) 2002 JOINT VENTURE 5.3 52,575 100.0 BOOKS-A-MILLION
RALEIGH (9) (6) 2002 JOINT VENTURE 15.2 152,273 88.8 FOOD LION
RALEIGH (9) 2002 JOINT VENTURE 12.6 124,520 93.2 RALEIGH ATHLETIC CLUB
RALEIGH 2002 FEE 10.3 101,965 96.9 HARRIS TEETER
WILSON (9) 2002 JOINT VENTURE 16.7 167,207 43.1 WINN DIXIE
WINSTON-SALEM 1969 FEE 13.2 137,433 97.8 HARRIS TEETER
OHIO
AKRON 1975 FEE 6.9 76,438 100.0 GIANT EAGLE
AKRON 1988 FEE 24.5 138,363 100.0 GABRIEL BROTHERS
AKRON 1988 FEE 12.6 149,054 -
AKRON 1988 GROUND LEASE (2012) 22.9 231,754 78.8 FIFTH AVENUE FLEA MARKET
BARBERTON 1972 FEE 10.0 118,826 73.9 GIANT EAGLE
BEAVERCREEK 1986 FEE 18.2 148,210 79.2 KROGER
BROOKLYN 1988 FEE 14.4 133,563 22.8 ALMOST FREE
BRUNSWICK 1975 FEE 20.0 171,223 92.6 KMART
CAMBRIDGE 1997 FEE 13.1 98,533 94.7 TRACTOR SUPPLY CO.
CANTON 1993 FEE 7.9 67,589 32.4 CINEMARK
CANTON 1972 FEE 19.6 172,596 91.6 BURLINGTON COAT FACTORY
CANTON 1988 FEE 9.2 99,267 -
CENTERVILLE 1988 FEE 15.2 120,498 100.0 BED BATH & BEYOND
CINCINNATI (7) 2000 FEE 36.7 378,901 98.1 WAL-MART
CINCINNATI 1988 FEE 11.6 224,883 100.0 LOWE'S HOME CENTER
CINCINNATI 1988 GROUND LEASE (2054) 8.8 121,242 100.0 BURLINGTON COAT FACTORY
CINCINNATI (3) 1988 FEE 29.2 321,675 81.7 HOBBY LOBBY
CINCINNATI 2000 FEE 8.8 88,317 100.0 HOBBY LOBBY
CINCINNATI 1999 FEE 16.7 89,742 98.9 BIGGS FOODS
CLEVELAND 1975 GROUND LEASE (2035) 9.4 69,383 70.3 ALDI
COLUMBUS (7) 2002 FEE 36.5 234,702 100.0 LOWE'S HOME CENTER
COLUMBUS 1988 FEE 12.4 191,089 100.0 KOHLS
COLUMBUS 1988 FEE 13.7 142,743 97.4 KOHLS
COLUMBUS 1988 FEE 17.9 129,008 100.0 KOHLS
COLUMBUS 1988 FEE 12.4 135,650 100.0 KOHLS
COLUMBUS 1988 FEE 12.5 99,262 100.0 SOUTHLAND EXPO
COLUMBUS (7) 1998 FEE 12.1 112,922 96.8 BORDERS BOOKS
COPLEY (8) 2003 JOINT VENTURE 9.4 525,841 99.5 INLAND I DELAWARE BUSINESS
DAYTON 1969 GROUND LEASE (2043) 22.8 163,131 81.6 BEST BUY
DAYTON 1984 FEE 32.1 213,728 90.0 VICTORIA'S SECRET
MAJOR LEASES
---------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- --------------------------------------------------------------------------------------------------------------------------------
BROOKLYN 2004
BUFFALO 2012 2037 FASHION BUG 2005 2024 DRESS BARN 2007 2022
BUFFALO 2007 2015
BUFFALO, AMHERST 2013 2033
CENTEREACH 2015 2044 BIG LOTS 2011 2021 MODELL'S 2009 2019
COMMACK 2017 2047 LINENS N THINGS 2018 2038 SPORTS AUTHORITY 2017 2037
COPIAGUE (7) 2011 2056 JACK LALANNE 2008 2018
FREEPORT (7) 2025 TOYS "R" US 2020 2040 MARSHALLS 2006 2016
GLEN COVE (7) 2014 2029 ANNIE SEZ 2011 2026
HAMPTON BAYS 2005 2025 GENOVESE 2006 2016
HEMPSTEAD (7) 2059
LATHAM (7) 2013 2043 WAL-MART 2013 2043 HOME DEPOT 2031 2071
LITTLE NECK
MANHASSET (3) 2006 2011 MANHASSET DIAGNOSTIC 2012 2027
MERRICK (7) 2013 2041 ANNIE SEZ 2006 2021 PARTY CITY 2012 2022
MIDDLETOWN (7) 2016 2031 LINENS N THINGS 2016 2031
MUNSEY PARK (7) 2007 2022 FRESH FIELDS 2011 2021
NANUET 2012 2022 TUESDAY MORNING 2007 2017
OCEANSIDE
PLAINVIEW 2017 2037
POUGHKEEPSIE 2020 2049 ODD LOTS 2007 2017
RENSSELAER 2018 2038 FASHION BUG 2005 2019
ROCHESTER 2010 2022 1180 JEFFERSON ROAD 2015 2025
ROCHESTER 2010 2027
ROCHESTER 2004 2024
STATEN ISLAND (7) 2005 2025 NATIONAL LIQUIDATORS 2010 2030 MICHAELS 2006 2031
STATEN ISLAND 2006 2011 PATHMARK 2011 2021
STATEN ISLAND 2006 2031
SYOSSET 2016 2021
YONKERS(7) 2014 2029
YONKERS 2008 2028
NORTH CAROLINA
APEX (9) 2018
CARY (7) 2020 2040 KOHLS 2022 2001 PETSMART 2016 2036
CARY 2005 2014 DICK'S CLOTHING & SPORTING 2014 2029
CARY 2017 2037 ECKERD 2007 2017
CARY (9) 2013 2028 BEYOND FITNESS 2011 2025 GREGORY'S 2008
CARY (8) 2017 2027 FOOD LION 2019 DOLLAR TREE 2009 2019
CHARLOTTE 2005 2020 TJ MAXX 2007 2017 CVS 2015 2035
CHARLOTTE 2009 2029 RUGGED WEARHOUSE 2008 2018 PARTY CITY 2004 2014
CHARLOTTE 2012 2042 K&G MEN'S COMPANY 2008 2018 OFFICEMAX 2009 2024
DURHAM (7) 2015 2035 BEST BUY 2011 2026 LINENS N THINGS 2011 2026
DURHAM (4) 2023 2053
DURHAM 2009 2014 JO-ANN FABRICS 2010 2020
GASTONIA 2013 2023 TOYS "R" US 2015 2045 BOOK EXPRESS 2006
GREENSBORO 2014 2024 USA BABY 2008 2013
GREENSBORO (7) 2011 2031 DAVID'S BRIDAL 2006 2026
LENOIR (9) 2014 2044 BELK'S STORE 2019 2029
PINEVILLE 2017 2067 STEIN MART 2007 2012 TJ MAXX 2008 2018
RALEIGH (9) 2021 2052
RALEIGH 2005 2020 MARSHALLS 2009 2014 OFFICEMAX 2011
RALEIGH (4) 2019 2029
RALEIGH (4)
RALEIGH (4) 2023 2043
RALEIGH 2019 2059
RALEIGH (9) 2006 2016
RALEIGH (9) (6) 2014 2034 BIG LOTS 2006 2016 KIMBRELL'S 2008
RALEIGH (9) 2006 2026 VERTICAL URGE 2010 2013
RALEIGH 2014 2034 ECKERD 2005 2015
WILSON (9) 2018
WINSTON-SALEM 2016 2041 DOLLAR TREE 2006 2016 SPORTSMAN'S SUPPLY 2008
OHIO
AKRON 2021 2041
AKRON 2005 2025 PAT CATANS CRAFTS 2013 ESSENCE BEAUTY MART 2008 2014
AKRON
AKRON 2005 PRIME BUSINESS SOLUTIONS 2006 2008 TIME WARNER CABLE 2005
BARBERTON 2027 2049
BEAVERCREEK 2018 2048 MOORES FITNESS 2007 2013 REVCO 2007 2027
BROOKLYN 2010
BRUNSWICK 2005 2050 GIANT EAGLE 2006 2031
CAMBRIDGE 2010 2020 KROGER 2004 2014
CANTON 2005
CANTON 2018 2043 TJ MAXX 2007 2017 PRICELESS KIDS 2007 2012
CANTON
CENTERVILLE 2017 2032 THE TILE SHOP 2014 2024 ODD-JOB 2007 2017
CINCINNATI (7) 2010 2040 THRIFTWAY 2006 2026 DICK'S SPORTING GOODS 2016 2031
CINCINNATI 2022 2052 CIRCUIT CITY 2008 2031 BIG LOTS 2009 2019
CINCINNATI 2005 2025 TOYS "R" US 2019 2044
CINCINNATI (3) 2012 2022 RHODES FURNITURE 2013 2023 TOYS "R" US 2016 2046
CINCINNATI 2011 2021 GOLD'S GYM 2017 2027
CINCINNATI 2008 2028
CLEVELAND 2004 2023
COLUMBUS (7) 2016 2046 KROGER 2017 2037
COLUMBUS 2011 2031 KROGER 2031 2071 TOYS "R" US 2015 2040
COLUMBUS 2011 2031 STAPLES 2010 2020
COLUMBUS 2011 2031 GRANT/RIVERSIDE HOSP 2011
COLUMBUS 2011 2031 CIRCUIT CITY 2019 2039
COLUMBUS 2006
COLUMBUS (7) 2018 2038 ZANY BRAINY 2007 2017 FRANNYS HALLMARK 2004 2014
COPLEY (8) 2017 2067 HOME DEPOT 2013 2063 DICK'S SPORTING GOODS 2020 2045
DAYTON 2004 2024 BIG LOTS 2008 2018 JO-ANN FABRICS 2007 2012
DAYTON 2004 2019 JO-ANN FABRICS 2006 2016 KROGER 2012 2038
24
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
DAYTON 1988 FEE 16.9 141,616 100.0 VALUE CITY
DAYTON 1988 FEE 11.2 116,374 100.0 VALUE CITY
HUBER HEIGHTS (7) 1999 FEE 40.0 318,468 98.6 ELDER BEERMAN
KENT 1988 GROUND LEASE (2013) 12.2 106,500 100.0 TOPS SUPERMARKET
LIMA 1986 FEE 18.1 193,633 96.3 RAYS SUPERMARKET
MENTOR 1987 FEE 20.6 103,910 100.0 GABRIEL BROTHERS
MENTOR 1988 FEE 25.0 271,259 85.2 GIANT EAGLE
MIAMISBURG 1999 FEE 0.6 12,600 47.6
MIDDLEBURG HEIGHTS 1988 FEE 8.2 104,342 51.5 GABRIEL BROTHERS
NORTH OLMSTEAD 1988 FEE 11.7 99,862 100.0 TOPS SUPERMARKET
ORANGE TOWNSHIP (4) 2001 FEE 19.8 14,000 100.0
SHARONVILLE 1977 GROUND LEASE (2076)/JOINT VENTURE 15.0 130,715 77.8 KROGER
SPRINGBORO PIKE 1985 FEE 13.0 120,522 100.0 RHODES FURNITURE
SPRINGDALE (7) 2000 FEE 22.0 243,047 89.7 WAL-MART
SPRINGFIELD 1988 FEE 14.3 131,628 100.0 KMART
UPPER ARLINGTON 1969 FEE 13.3 160,602 100.0 TJ MAXX
WESTERVILLE 1993 FEE 25.4 242,124 88.3 MARC'S
WICKLIFFE 1982 FEE 10.0 128,180 100.0 GABRIEL BROTHERS
WILLOUGHBY HILLS 1988 FEE 14.1 156,219 33.0 MARCS DRUGS
OKLAHOMA
MIDWEST CITY 1998 FEE 9.7 99,433 -
NORMAN (7) 2001 FEE 31.3 262,624 100.0 TOYS "R" US
OKLAHOMA CITY 1997 FEE 9.8 103,027 100.0 ACADEMY SPORTS
OKLAHOMA CITY 1998 FEE 19.8 232,635 99.2 HOME DEPOT
SOUTH TULSA 1996 FEE 8.8 100,190 4.1
PENNSLYVANIA
BETHLEHEM 2003 FEE 0.5 80,695 100.0 SUPER FRESH
BLUE BELL 1996 FEE 17.7 120,211 100.0 KOHLS
CARLISLE 2003 FEE 9.3 86,260 97.7 NELLS MARKET
CHAMBERSBURG 2003 FEE 5.5 121,593 99.0 GIANT
CHIPPEWA 2000 FEE 22.4 215,206 100.0 KMART
DUQUESNE 1993 FEE 8.8 69,733 100.0 PAT CATANS CRAFTS
EAGLEVILLE 1973 FEE 15.2 165,385 100.0 KMART
EAST NORRITON 1984 FEE 12.5 136,635 97.1 SHOPRITE
EAST STROUDSBURG 1973 FEE 15.3 168,506 100.0 KMART
EASTWICK 1997 FEE 3.4 36,511 92.6 MERCY HOSPITAL
EXTON 1990 FEE 6.1 60,685 100.0 ACME MARKETS
EXTON 1996 FEE 9.8 85,184 100.0 KOHLS
FEASTERVILLE 1996 FEE 4.6 86,575 100.0 VALUE CITY
GETTYSBURG 1986 FEE 2.3 30,706 93.8 GIANT FOOD
GREENSBURG 2002 JOINT VENTURE 5.0 50,000 100.0 TJ MAXX
HAMBURG 2001 FEE 1.5 15,400 100.0 LEHIGH VALLEY HEALTH
HARRISBURG 1972 FEE 17.0 175,917 100.0 GANDER MOUNTAIN
HARRISBURG 1972 FEE 11.7 154,896 42.2 BIG LOTS
HAVERTOWN 1996 FEE 9.0 80,938 100.0 KOHLS
LANDSDALE 1996 GROUND LEASE (2037) 1.4 84,470 100.0 KOHLS
MIDDLETOWN 1973 FEE 21.9 140,481 61.9 SHARP SHOPPER
MIDDLETOWN 1986 FEE 4.7 38,953 83.0 US POST OFFICE
MONROEVILLE 2003 FEE 13.7 142,900 100.0 BED BATH & BEYOND
MONTGOMERY (7) 2002 FEE 45.0 257,565 100.0 GIANT FOOD
NEW KENSINGTON 1986 FEE 12.5 106,624 100.0 GIANT EAGLE
PHILADELPHIA 1983 JOINT VENTURE 8.1 214,970 98.5 JC PENNEY
PHILADELPHIA 1995 JOINT VENTURE 22.6 277,123 98.8 SUPER FRESH
PHILADELPHIA 1996 FEE 6.3 82,345 100.0 KOHLS
PHILADELPHIA 1996 GROUND LEASE (2035) 6.8 133,309 100.0 KMART
POTTSTOWN 2003 FEE 0.3 161,727 96.5 GIANT FOOD
RICHBORO 1986 FEE 14.5 110,357 100.0 SUPER FRESH
SCOTT TOWNSHIP 2000 GROUND LEASE (2052) 6.9 69,288 100.0 WAL-MART
SHREWSBURY 2003 FEE 0.2 84,025 88.2 GIANT FOOD
SPRINGFIELD 1983 FEE 19.7 218,907 92.1 VALUE CITY
UPPER ALLEN 1986 FEE 6.0 59,470 96.2 GIANT FOOD
UPPER DARBY 1996 JOINT VENTURE 16.3 48,936 91.4 MERCY HOSPITAL
WAYNESBORO 2003 FEE 9.3 107,549 49.6 MARTIN'S
WEST MIFFLIN 1974 FEE 21.9 193,878 94.7 GIANT EAGLE
WEST MIFFLIN 1986 GROUND LEASE (2032) 8.3 84,279 94.0 AMES
WHITEHALL 1996 GROUND LEASE (2081) 6.0 84,524 100.0 KOHLS
YORK 1986 FEE 8.0 61,979 81.8 SUPERPETZ
YORK 1986 FEE 13.7 59,016 95.2 GIANT FOOD
YORK 1986 FEE 3.3 35,500 100.0 GIANT FOOD
RHODE ISLAND
CRANSTON 1998 FEE 11.0 129,907 92.2 BOB'S STORES
PROVIDENCE 2003 GROUND LEASE (2022)/JOINT VENTURE 13.0 70,235 100.0 STOP & SHOP
SOUTH CAROLINA
AIKEN (6) 1989 FEE 3.2 11,200 71.6
CHARLESTON 1978 FEE 17.6 169,813 89.3 STEIN MART
CHARLESTON 1995 FEE 17.2 186,740 99.1 TJ MAXX
CHARLESTON (8) 2003 JOINT VENTURE 15.7 136,276 89.6 BED BATH & BEYOND
CONWAY (9) 2002 JOINT VENTURE 5.4 54,124 100.0 FOOD LION
FLORENCE 1997 FEE 21.0 113,922 97.2 HAMRICKS
GREENVILLE 1997 FEE 20.4 148,490 91.2 RHODES FURNITURE
MT PLEASANT (9) 2002 JOINT VENTURE 11.6 115,740 96.9 WHOLE FOODS
NORTH CHARLESTON 2000 FEE 27.3 267,698 100.0 SPORTS AUTHORITY
ORANGEBURG (9) 2002 JOINT VENTURE 10.7 106,557 82.2 BI-LO
WALTERBORO (9) 2002 JOINT VENTURE 4.8 47,640 97.9 FOOD LION
TENNESSEE
CHATTANOOGA 2002 JOINT VENTURE 5.0 50,000 100.0 HOME GOODS
CHATTANOOGA 1973 GROUND LEASE (2074) 7.6 50,588 82.8
MADISON (7) 1999 FEE 21.1 189,299 99.5 SPORTS AUTHORITY
MADISON 1978 GROUND LEASE (2039) 14.5 184,506 70.6 OLD TIME POTTERY
MEMPHIS (7) 2001 FEE 3.9 40,000 100.0 BED BATH & BEYOND
MEMPHIS 2000 FEE 8.8 87,962 100.0 OLD TIME POTTERY
MEMPHIS 1991 FEE 14.7 167,243 96.2 TOYS "R" US
MAJOR LEASES
---------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- --------------------------------------------------------------------------------------------------------------------------------
DAYTON 2010 2020 CIRCUIT CITY 2018 2038 DOLLAR GENERAL 2004 2007
DAYTON 2010 2015 BUTTERNUT BREAD 2004
HUBER HEIGHTS (7) 2014 2044 KOHLS 2015 2035 MARSHALLS 2009 2024
KENT 2026 2096
LIMA 2011 2026 SEAWAY FOOD TOWN 2009 2024 JO-ANN FABRICS 2006 2011
MENTOR 2013 2028 BIG LOTS 2014 2034
MENTOR 2019 2029 BURLINGTON COAT FACTORY 2014 JO-ANN FABRICS 2009 2019
MIAMISBURG
MIDDLEBURG HEIGHTS 2014 2029
NORTH OLMSTEAD 2026 2096
ORANGE TOWNSHIP (4)
SHARONVILLE 2008 2028 GABRIEL BROTHERS 2012 2032
SPRINGBORO PIKE 2013 2028 OFFICEMAX 2007 DOLLAR TREE 2008 2018
SPRINGDALE (7) 2015 2045 HH GREGG 2012 2017 OFFICEMAX 2009 2024
SPRINGFIELD 2010 2030 HOBBY LOBBY 2010 2020
UPPER ARLINGTON 2011 2021 PEDDLERS VILLAGE 2008 CVS 2019 2039
WESTERVILLE 2013 2023 KOHLS 2016 2036 OFFICEMAX 2007 2022
WICKLIFFE 2008 2023 BIG LOTS 2005 2010 DOLLAR GENERAL 2004
WILLOUGHBY HILLS 2012 2017
OKLAHOMA
MIDWEST CITY
NORMAN (7) 2012 2042 ROSS STORES 2007 2027 BARNES & NOBLE 2012 2027
OKLAHOMA CITY 2013 2023
OKLAHOMA CITY 2014 2044 GORDMANS 2013 2033 BEST BUY 2008 2023
SOUTH TULSA
PENNSLYVANIA
BETHLEHEM 2018 2058
BLUE BELL 2016 2036 HOME GOODS 2013 2033
CARLISLE 2010 2020
CHAMBERSBURG 2010 2040 CVS 2006 2020
CHIPPEWA 2018 2068 HOME DEPOT 2018 2068
DUQUESNE 2005 RED, WHITE & BLUE 2005
EAGLEVILLE 2004 2019 SAFEWAY 2011 2025
EAST NORRITON 2017 2037 STAPLES 2008 2023 JO-ANN FABRICS 2007 2012
EAST STROUDSBURG 2007 2022 WEIS MARKETS 2005 2010
EASTWICK 2012 2022
EXTON 2015 2045
EXTON 2016 2036
FEASTERVILLE 2011 2026
GETTYSBURG 2005 2010
GREENSBURG 2010 MICHAELS 2010
HAMBURG 2016 2026
HARRISBURG 2013 2028 MEDIA PLAY 2011 2026 SUPERPETZ 2007 2022
HARRISBURG 2015 2045
HAVERTOWN 2016 2036
LANDSDALE 2012
MIDDLETOWN 2010 2015 ELECTRONICS INSTITUTE 2004 CVS 2008
MIDDLETOWN 2016 2026
MONROEVILLE 2019 2034 PETSMART 2019 2034 MICHAELS 2009 2029
MONTGOMERY (7) 2020 2050 BED BATH & BEYOND 2016 2030 COMPUSA 2014 2028
NEW KENSINGTON 2006 2026
PHILADELPHIA 2012 2037 TOYS "R" US 2007 2052
PHILADELPHIA 2022 2047 PETSMART 2006 2016 AMC THEATERS 2004 2023
PHILADELPHIA 2016 2036
PHILADELPHIA 2010 2035
POTTSTOWN 2014 2049 TRACTOR SUPPLY CO. 2012 2027 TJ MAXX 2004 2019
RICHBORO 2018 2058
SCOTT TOWNSHIP 2015 2052
SHREWSBURY 2023 2053
SPRINGFIELD 2013 2043 STAPLES 2008 2023 JO-ANN FABRICS 2006 2016
UPPER ALLEN 2010 2030 CVS 2008
UPPER DARBY 2012 2022 ALLEGHENY CHILD ACADEMY 2012 2022
WAYNESBORO 2005 2025
WEST MIFFLIN 2014 2039 KENNYWOOD AMUSEMENT 2005
WEST MIFFLIN 2007 2032
WHITEHALL 2016 2036
YORK 2004 2009 ECKERD 2004
YORK 2006 2026 CVS 2005 2020
YORK 2007 2017
RHODE ISLAND
CRANSTON 2008 2028 MARSHALLS 2011 2021
PROVIDENCE 2022 2072
SOUTH CAROLINA
AIKEN (6)
CHARLESTON 2006 2016 BY THE YARD 2006 2017 GCO CARPET 2012
CHARLESTON 2009 2014 OFFICE DEPOT 2006 2016 MARSHALLS 2006 2011
CHARLESTON (8) 2014 2034 COST PLUS 2014 2029
CONWAY (9) 2017 2037
FLORENCE 2006 2011 STAPLES 2010 2035 ATHLETE'S FOOT 2007 2017
GREENVILLE 2005 2020 BABIES R US 2007 2022
MT PLEASANT (9) 2024 2054 STAPLES 2012
NORTH CHARLESTON 2013 2033 TJ MAXX 2008 2013 MARSHALLS 2008 2013
ORANGEBURG (9) 2011 2031
WALTERBORO (9) 2018 2038
TENNESSEE
CHATTANOOGA 2010 MICHAELS 2017
CHATTANOOGA
MADISON (7) 2013 2028 BEST BUY 2014 2029 GOODY'S FAMILY CLOTHING 2010 2020
MADISON 2004 2006
MEMPHIS (7) 2012 2027
MEMPHIS 2010 2025
MEMPHIS 2017 2042 OFFICEMAX 2008 2028 MEMPHIS FEET 2015 2025
25
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
NASHVILLE (7) 1999 FEE 9.3 99,909 100.0 BEST BUY
NASHVILLE 1998 FEE 10.2 109,012 100.0 MARSHALLS
NASHVILLE 1986 FEE 16.9 172,135 100.0 STEIN MART
TEXAS
AMARILLO (7) 1997 FEE 9.3 343,989 96.7 HOME DEPOT
AMARILLO (7) 2003 JOINT VENTURE 10.6 142,747 96.0 ROSS STORES
ARLINGTON (8) 2002 JOINT VENTURE 6.3 75,248 100.0 TJ MAXX
ARLINGTON 1997 FEE 8.0 96,127 100.0 HOBBY LOBBY
AUSTIN (7) 1998 FEE 18.2 191,760 100.0 CIRCUIT CITY
AUSTIN 1998 FEE 15.4 157,852 98.6 HEB GROCERY
AUSTIN 2003 JOINT VENTURE 10.8 108,028 100.0 FRY'S ELECTRONICS
BAYTOWN 1996 FEE 8.7 86,240 100.0 HOBBY LOBBY
BEAUMONT (4) 2002 FEE 11.4 76,000 100.0 BED BATH & BEYOND
BURLESON (4) 2000 JOINT VENTURE 54.6 27,000 100.0
BURLESON (4) 2003 JOINT VENTURE 1.3 - -
DALLAS 2002 JOINT VENTURE 5.0 50,000 60.0 CONN'S
DALLAS (8) 2002 JOINT VENTURE 9.6 105,195 92.6 TOM THUMB
DALLAS 1969 JOINT VENTURE 75.0 - -
DALLAS (7) 1998 FEE 6.8 83,867 100.0 ROSS STORES
DUNCANVILLE 1996 FEE 6.8 96,500 -
EAST PLANO 1996 FEE 9.0 100,598 100.0 HOME DEPOT EXPO
FORT WORTH (4) 2003 JOINT VENTURE 45.5 - -
GARLAND (7) 1998 FEE 6.3 62,000 80.6 OFFICE DEPOT
GARLAND 1996 FEE 2.9 41,364 100.0 KROGER
GARLAND 1996 FEE 8.8 103,600 -
HOUSTON (8) 2002 FEE 8.7 95,032 98.6 MARSHALLS
HOUSTON (4) 2001 JOINT VENTURE 23.8 77,000 100.0 ROSS STORES
HOUSTON 1998 FEE 40.0 434,997 86.0 OSHMAN SPORTING
HOUSTON 1997 FEE 8.0 113,831 89.1 HEB PANTRY STORE
HOUSTON 1999 FEE 5.6 84,188 100.0 OFFICE DEPOT
HOUSTON (8) 2003 JOINT VENTURE 17.1 183,024 93.4 ROSS STORES
HOUSTON (4) 2003 JOINT VENTURE 30.0 - -
HOUSTON (7) 2002 FEE 54.0 585,901 94.3 LOEWS THEATRES
HOUSTON 1996 FEE 8.2 96,500 100.0 BURLINGTON COAT FACTORY
LAKE WORTH (4) 2003 2003 57.9 - -
LEWISVILLE 1998 FEE 11.2 74,837 91.2 BALLY TOTAL FITNESS
LEWISVILLE 1998 FEE 7.6 123,560 83.9 BABIES R US
LEWISVILLE 1998 FEE 9.4 93,668 65.4 DSW SHOE WAREHOUSE
LUBBOCK 1998 FEE 9.6 108,326 100.0 PETSMART
MESQUITE 1974 FEE 9.0 79,550 100.0 KROGER
MESQUITE 1998 FEE 30.0 209,836 83.2 BEST BUY
N. BRAUNFELS 2003 JOINT VENTURE 8.6 86,479 100.0 KOHLS
NORTH RICHLAND HILLS 1997 FEE 9.2 - -
PASADENA (7) 1999 FEE 15.1 169,203 100.0 PETSMART
PASADENA (7) 2001 FEE 24.6 241,172 96.3 BEST BUY
RICHARDSON (7) 1998 FEE 11.7 115,579 100.0 OFFICEMAX
SAN ANTONIO (4) 1999 FEE 10.8 129,000 95.8 HOBBY LOBBY
WOODLANDS (4) 2002 JOINT VENTURE 34.0 169,000 100.0 HEB GROCERY
UTAH
OGDEN 1967 FEE 11.4 142,628 100.0 COSTCO
VIRGINIA
BURKE 2003 OTH 12.5 125,830 99.3 SAFEWAY
COLONIAL HEIGHTS 1996 FEE 6.1 60,909 100.0 BLOOM BROS
FAIRFAX (7) 1998 FEE 37.0 323,262 100.0 HOME DEPOT
FREDERICKSBURG 2003 FEE 11.2 141,857 98.7 KMART
HARRISONBURG 1993 FEE 5.3 31,111 53.9 STAPLES
HARRISONBURG (9) 2002 JOINT VENTURE 14.0 139,956 51.4 FARMER JACK
HARRISONBURG 2003 FEE 12.3 150,404 92.5 KOHLS
MANASSAS 1997 FEE 13.5 117,525 100.0 SUPER FRESH
MANASSAS 2003 FEE 8.9 107,761 100.0 BURLINGTON COAT FACTORY
PETERSBURG (9) 2002 JOINT VENTURE 5.0 50,280 89.1 FOOD LION
RICHMOND 2002 FEE 8.5 84,683 100.0 BLOOM BROTHERS FURNITURE
RICHMOND 1995 FEE 11.5 128,612 100.0 BURLINGTON COAT FACTORY
ROANOKE (9) 2002 JOINT VENTURE 30.2 302,128 82.9 HEIRONIMUS
STERLING (8) 1995 JOINT VENTURE 38.1 361,375 100.0 TOYS "R" US
WOODBRIDGE 1973 GROUND LEASE (2072)/JOINT VENTURE 19.6 189,563 98.2 AMES
WOODBRIDGE (7) 1998 FEE 54.0 495,596 98.2 LOWE'S HOME CENTER
WOODBRIDGE 2003 FEE 27.6 316,626 92.3 LOWE'S HOME CENTER
WASHINGTON
BELLINGHAM (7) 1998 FEE 20.0 188,885 100.0 BON HOME STORE
FEDERAL WAY (7) 2000 FEE 17.0 200,126 100.0 ASSOCIATED GROCERY
LONGVIEW (4) 2003 JOINT VENTURE 50.6 156,000 100.0 ACE HARDWARE
MARYSVILLE (8) 2002 JOINT VENTURE 15.5 226,038 99.0 ALBERTSONS
SPOKANE (8) 2002 JOINT VENTURE 13.0 129,785 97.2 BED BATH & BEYOND
TUKWILA (7) 2003 JOINT VENTURE 46.7 467,496 100.0 THE BON MARCHE
VANCOUVER (4) 2003 JOINT VENTURE 38.9 - -
WEST VIRGINIA
CHARLES TOWN 1985 FEE 22.0 208,048 100.0 WAL-MART
MARTINSBURG 1986 FEE 6.0 43,212 100.0 GIANT FOOD
SOUTH CHARLESTON 1999 FEE 14.8 188,589 100.0 KROGER
WISCONSIN
RACINE 1988 FEE 14.2 157,150 92.6 PIGGLY WIGGLY
CANADA
ALBERTA
SHOPPES @ SHAWNESSEY 2002 JOINT VENTURE 16.30 163,000 100.0 ZELLERS
SHAWNESSY CENTRE 2002 JOINT VENTURE 30.61 306,059 100.0 FUTURE SHOP (BEST BUY)
BRENTWOOD 2002 JOINT VENTURE 31.23 312,311 99.3 CANADA SAFEWAY
SOUTH EDMONTON COMMON 2002 JOINT VENTURE 39.02 390,202 100.0 HOME OUTFITTERS
GRANDE PRAIRIE III 2002 JOINT VENTURE 6.34 63,413 100.0 MICHAELS
BRITISH COLUMBIA
TILLICUM 2002 JOINT VENTURE 41.14 411,393 97.9 ZELLERS
MAJOR LEASES
---------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- --------------------------------------------------------------------------------------------------------------------------------
NASHVILLE (7) 2014 2029 OFFICEMAX 2015 2035
NASHVILLE 2007 OFFICEMAX 2009 2019 OLD COUNTRY BUFFET 2006 2016
NASHVILLE 2005 2013 ASHLEY FURNITURE HOMESTORE 2012 2022 BED BATH & BEYOND 2013 2028
TEXAS
AMARILLO (7) 2019 2069 KOHLS 2025 2055 CIRCUIT CITY 2010 2035
AMARILLO (7) 2012 2037 BED BATH & BEYOND 2012 2032 JO-ANN FABRICS 2012 2032
ARLINGTON (8) 2011 2021
ARLINGTON 2008 2018
AUSTIN (7) 2017 2037 BABIES R US 2012 2027 WORLD MARKET 2011 2026
AUSTIN 2006 2026 DANCE SPACE 2006 2011
AUSTIN 2018 2048
BAYTOWN 2008 2018 ROSS STORES 2012 2032
BEAUMONT (4) 2013 2033 SHOE CARNIVAL 2013 2023
BURLESON (4)
BURLESON (4)
DALLAS 2013
DALLAS (8) 2017 2032
DALLAS
DALLAS (7) 2007 2017 OFFICEMAX 2009 2024 BIG LOTS 2012 2032
DUNCANVILLE
EAST PLANO 2024 2054
FORT WORTH (4)
GARLAND (7) 2006 2021 99 CENTS ONLY STORE 2009 2024
GARLAND 2005 2025
GARLAND
HOUSTON (8) 2008 2023 SUIT MART 2009 2014
HOUSTON (4) 2013 2033 PETCO 2014 2034
HOUSTON 2009 2024 HOBBY LOBBY 2012 2022 BED BATH & BEYOND 2009 2019
HOUSTON 2007 2027 PALAIS ROYAL 2007 2022
HOUSTON 2007 2022 METROPOLITAN FURNITURE 2013 2023 JUST FOR FEET 2013 2023
HOUSTON (8) 2013 2033 OFFICE DEPOT 2012 2032 OLD NAVY 2007 2022
HOUSTON (4)
HOUSTON (7) 2017 2047 HOBBY LOBBY 2016 2026 OSHMAN SPORTING 2017 2037
HOUSTON 2020 2035
LAKE WORTH (4)
LEWISVILLE 2007 2022 TALBOTS OUTLET 2007 2017
LEWISVILLE 2009 2027 BED BATH & BEYOND 2018 2033
LEWISVILLE 2008 2028 PETLAND 2009 2019
LUBBOCK 2015 2040 OFFICEMAX 2009 2029 BARNES & NOBLE 2010 2025
MESQUITE 2012 2037
MESQUITE 2009 2024 ASHLEY FURNITURE HOMESTORE 2007 2017 PETSMART 2007 2027
N. BRAUNFELS 2014 2064
NORTH RICHLAND HILL
PASADENA (7) 2015 2030 OFFICEMAX 2014 2029 MICHAELS 2009 2024
PASADENA (7) 2012 2027 ROSS STORES 2012 2032 MARSHALLS 2012 2027
RICHARDSON (7) 2011 2026 BALLY TOTAL FITNESS 2009 2019 NORTHERN STORES 2004 2014
SAN ANTONIO (4) 2018 2033 BEALLS 2014 2024
WOODLANDS (4) 2025 2045 BORDERS BOOKS 2024 2044
UTAH
OGDEN 2033 2073
VIRGINIA
BURKE 2020 2050 CVS 2021 2041
COLONIAL HEIGHTS 2008 BOOKS-A-MILLION 2008 2015
FAIRFAX (7) 2013 2033 COSTCO 2011 2046 SPORTS AUTHORITY 2008 2013
FREDERICKSBURG 2007 2032
HARRISONBURG 2004 2014
HARRISONBURG (9) 2007 2037 CVS 2007 2017
HARRISONBURG 2024 2064 TOYS "R" US 2010 2040
MANASSAS 2006 2026 JO-ANN FABRICS 2006 2011
MANASSAS 2009 2030 CVS/PEOPLES 2004 2014
PETERSBURG (9) 2011 2031
RICHMOND 2013 2023
RICHMOND 2006 2035
ROANOKE (9) 2004 2008 MICHAELS 2004 2019 MARSHALLS 2013 2033
STERLING (8) 2012 2037 MICHAELS 2011 2026 CIRCUIT CITY 2017 2037
WOODBRIDGE 2006 2021 CAMPOS FURNITURE 2004 CAMPOS FURNITURE 2006
WOODBRIDGE (7) 2012 2032 SHOPPERS FOOD 2009 2044 PETSMART 2009 2014
WOODBRIDGE 2023 2053 ARBY'S RESTAURANT 2025 2035
WASHINGTON
BELLINGHAM (7) 2012 2022 BEST BUY 2017 2032 BED BATH & BEYOND 2012 2027
FEDERAL WAY (7) 2015 2045 JO-ANN FABRICS 2010 2030 BARNES & NOBLE 2011 2026
LONGVIEW (4) 2014 2029 TRIANGLE DEVELOPMENT 2005 RITE AID 2006 2011
MARYSVILLE (8) 2022 2067 GOTTSCHALKS 2008 2018 JC PENNEY 2011 2046
SPOKANE (8) 2011 2026 ROSS STORES 2009 2019 RITE AID 2009 2039
TUKWILA (7) 2009 2019 BEST BUY 2016 2031 GART SPORTS 2014 2029
VANCOUVER (4)
WEST VIRGINIA
CHARLES TOWN 2017 2047 STAPLES 2008 2018
MARTINSBURG 2010 2030 CVS 2004 2008
SOUTH CHARLESTON 2008 2038 TJ MAXX 2006 2021 KRISPY KREME 2006 2026
WISCONSIN
RACINE 2015 2030 BIG LOTS 2005 2015 HOBO 2004 2014
CANADA
ALBERTA
SHOPPES @ SHAWNESSE 2011 2096
SHAWNESSY CENTRE 2009 2024 LINEN N THINGS 2015 2025 BUSINESS DEPOT (STAPLES) 2013 2028
BRENTWOOD 2007 2037 SEARS WHOLE HOME 2010 2020 LINEN N THINGS 2016 2031
SOUTH EDMONTON COMM 2016 2031 LONDON DRUGS 2020 2057 MICHAELS 2011 2026
GRANDE PRAIRIE III 2011 2031 WINNERS (TJ MAXX) 2011 2026 JYSK LINEN 2012 2022
BRITISH COLUMBIA
TILLICUM 2013 2098 SAFEWAY 2023 2053 WINNERS (TJ MAXX) 2008 2023
26
MAJOR LEASES
YEAR OWNERSHIP LAND LEASABLE PERCENT --------------------------
DEVELOPED INTEREST/ AREA AREA LEASED
LOCATION OR ACQUIRED (EXPIRATION)(2) (ACRES) (SQ. FT.) (1) TENANT NAME
- ----------------------------------------------------------------------------------------------------------------------------------
PRINCE GEORGE 2001 JOINT VENTURE 37.27 372,725 94.7 OVERWAITEE
STRAWBERRY HILL 2002 JOINT VENTURE 33.28 332,817 99.6 HOME DEPOT
MISSION 2001 JOINT VENTURE 25.65 256,547 97.6 OVERWAITEE
ABBOTSFORD 2002 JOINT VENTURE 19.86 198,574 95.4 ZELLERS
CLEARBROOK 2001 JOINT VENTURE 18.83 188,252 94.6 SAFEWAY
SURREY 2001 JOINT VENTURE 17.06 170,591 99.4 CANADA SAFEWAY
LANGLEY GATE 2002 JOINT VENTURE 15.18 151,802 100.0 SEARS
LANGLEY POWER CENTER 2003 JOINT VENTURE 22.83 228,314 100.0 WINNERS (TJ MAXX)
ONTARIO
SHOPPERS WORLD ALBION 2002 JOINT VENTURE 34.10 341,030 99.6 CANADIAN TIRE
SHOPPERS WORLD DANFORTH 2002 JOINT VENTURE 32.88 328,820 99.8 ZELLERS
THICKSON RIDGE 2002 JOINT VENTURE 32.29 322,904 100.0 WINNERS (TJ MAXX)
LINCOLN FIELDS 2002 JOINT VENTURE 28.68 286,791 96.9 WAL MART
404 TOWN CENTRE 2002 JOINT VENTURE 24.94 249,403 96.3 ZELLERS
SUDBURY 2002 JOINT VENTURE 23.43 234,299 100.0 FAMOUS PLAYERS
BOULEVARD CENTRE I 2002 JOINT VENTURE 21.74 217,446 99.5 ZELLERS
BOULEVARD CENTRE II 2002 JOINT VENTURE - - -
GREEN LANE CENTRE 2003 JOINT VENTURE 17.22 172,194 100.0 LINEN N THINGS
KENDALWOOD 2002 JOINT VENTURE 15.44 154,445 97.8 PRICE CHOPPER
LEASIDE 2002 JOINT VENTURE 13.30 133,035 100.0 CANADIAN TIRE
WALKER PLACE 2002 JOINT VENTURE 6.99 69,857 100.0 COMMISSO'S
RIOCAN GRAND PARK 2003 JOINT VENTURE 2.50 25,000 100.0 SHOPPERS DRUG MART
BOULEVARD III (4) 2002 JOINT VENTURE 4.86 - -
DUFFERIN (4) 2002 JOINT VENTURE 9.95 - -
BRAMPTON (4) 2003 JOINT VENTURE 11.14 - -
PRINCE EDWARD ISLAND
CHARLOTTETOWN 2002 JOINT VENTURE 38.97 389,704 97.5 ZELLERS
QUEBEC
GREENFIELD PARK 2002 JOINT VENTURE 37.47 374,693 92.0 WINNERS (TJ MAXX)
JACQUES CARTIER 2002 JOINT VENTURE 21.28 212,849 96.7 GUZZO CINEMA
CHATEAUGUAY 2002 JOINT VENTURE 21.16 211,573 98.4 SUPER C
MEXICO
SALTILLO PLAZA 2002 FEE 17.46 174,637 98.5 HEB
NUEVO LEON 2002 FEE 14.69 146,861 98.3 HEB
JUAREZ 2003 FEE 29.04 290,388 100.0 SORIANA
------------------
TOTAL 637 PROPERTY INTERESTS 10,287 90,084,405
------------------
ACQUISITIONS SUBSEQUENT TO DECEMBER 31, 2003 THROUGH FEBRUARY 5, 2004
MASSACHUSETTS
HYANNIS 2004 FEE 22.6 225,990 98.5 TOYS R US
MARLBOROUGH 2004 FEE 16.1 104,125 92.1 BEST BUY
TEXAS
TEMPLE 2004 JOINT VENTURE 26.8 274,786 87.4 HOBBY LOBBY
DISPOSITIONS SUBSEQUENT TO DECEMBER 31, 2003 THROUGH FEBRUARY 5, 2004
ILLINOIS
CHICAGO 1997 FEE 13.4 109,441 -
NORTH CAROLINA
RALEIGH 2002 JOINT VENTURE 15.2 152,273 88.8 FOOD LION
SOUTH CAROLINA
AIKEN 1989 FEE 3.2 11,200 71.6
RETAIL STORE LEASES (10) 1995/ 1997 LEASEHOLD 3,349,649
-----------------
GRAND TOTAL 673 PROPERTY INTERESTS 10,320 93,766,041 (11)
-----------------
MAJOR LEASES
----------------------------------------------------------------------------------------------------------
LEASE OPTION LEASE OPTION LEASE OPTION
LOCATION EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION TENANT NAME EXPIRATION EXPIRATION
- -----------------------------------------------------------------------------------------------------------------------------------
PRINCE GEORGE 2018 2028 THE BAY 2013 2083 LONDON DRUGS 2017 2027
STRAWBERRY HILL 2016 2016 CINEPLEX ODEON 2008 2018 WINNERS (TJ MAXX) 2009 2024
MISSION 2018 2028 FAMOUS PLAYERS 2010 2030 LONDON DRUGS 2019 2046
ABBOTSFORD 2017 2052 PETSMART 2013 2033 WINNERS (TJ MAXX) 2008 2023
CLEARBROOK 2007 2037 STAPLES 2012 2022 LANDMARK CINEMAS 2011 2021
SURREY 2011 2061 LONDON DRUGS 2011 2021
LANGLEY GATE 2008 2018 PETSMART 2008 2038 WINNERS (TJ MAXX) 2007 2017
LANGLEY POWER CENTER 2012 2027 MICHAELS 2011 2021 FUTURE SHOP (BEST BUY) 2012 2022
ONTARIO
SHOPPERS WORLD ALBION 2010 2025 FORTINO'S 2010 2030
SHOPPERS WORLD DANFORTH 2009 2029 DOMINION 2018 2028 BUSINESS DEPOT (STAPLES) 2015 2030
THICKSON RIDGE 2013 2022 FUTURE SHOP (BEST BUY) 2006 2016 SEARS WHOLE HOME 2012 2022
LINCOLN FIELDS 2010 2025 LOEB (GROUND) 2004 2019 CAA OTTAWA 2007 2015
404 TOWN CENTRE 2009 2024 A & P 2007 2027 NATIONAL GYM CLOTHING 2009 2014
SUDBURY 2019 2039 BUSINESS DEPOT (STAPLES) 2014 2029 CHAPTERS 2010 2030
BOULEVARD CENTRE I 2017 2046 WINNERS (TJ MAXX) 2008 2023 LOEB 2008
BOULEVARD CENTRE II
GREEN LANE CENTRE 2014 2029 MICHAELS 2013 2033 PETSMART 2008 2033
KENDALWOOD 2013 2038 VALUE VILLAGE 2008 2028 SHOPPERS DRUG MART 2011 2021
LEASIDE 2006 2036 FUTURE SHOP (BEST BUY) 2010 2025 PETSMART 2012 2037
WALKER PLACE 2012 2032
RIOCAN GRAND PARK 2018 2018
BOULEVARD III (4)
DUFFERIN (4)
BRAMPTON (4)
PRINCE EDWARD ISLAND
CHARLOTTETOWN 2019 2069 WINNERS (TJ MAXX) 2009 2019 WEST ROYALTY FITNESS 2010 2015
QUEBEC
GREENFIELD PARK 2005 2020 BUREAU EN GROS (STAPLES) 2007 2022 GUZZO CINEMA 2019 2039
JACQUES CARTIER 2010 2040 VALUE VILLAGE 2008 2028 IGA 2007 2022
CHATEAUGUAY 2008 2028 HART 2005 2025
MEXICO
SALTILLO PLAZA
NUEVO LEON
JUAREZ
TOTAL 637 PROPERTY INTERESTS
ACQUISITIONS SUBSEQUENT TO DECEMBER 31, 2003 THROUGH FEBRUARY 5, 2004
MASSACHUSETTS
HYANNIS 2019 HOME GOODS 2010 STARS MARKET 2018
MARLBOROUGH 2019 2034 DSW SHOE WAREHOUSE 2014 2034 BORDER GROUP 2019 2034
TEXAS
TEMPLE 2021 2036 ROSS STORES 2012 MARSHALLS 2011 2026
DISPOSITIONS SUBSEQUENT TO DECEMBER 31, 2003 THROUGH FEBRUARY 5, 2004
ILLINOIS
CHICAGO
NORTH CAROLINA
RALEIGH 2014 BIG LOTS 2006
SOUTH CAROLINA
AIKEN
RETAIL STORE LEASES (10) 1995/ 1997
GRAND TOTAL 673 PROPERTY INTERESTS
(1) PERCENT LEASED INFORMATION AS OF DECEMBER 31, 2003 OR DATE OF
ACQUISITION IF ACQUIRED SUBSEQUENT TO DECEMBER 31, 2003.
(2) THE TERM "JOINT VENTURE" INDICATES THAT THE COMPANY OWNS THE PROPERTY
IN CONJUNCTION WITH ONE OR MORE JOINT VENTURE PARTNERS. THE DATE
INDICATED IS THE EXPIRATION DATE OF ANY GROUND LEASE AFTER GIVING
AFFECT TO ALL RENEWAL PERIODS.
(3) DENOTES REDEVELOPMENT PROJECT.
(4) DENOTES GROUND-UP DEVELOPMENT PROJECT. THE SQUARE FOOTAGE SHOWN
REPRESENTS THE COMPLETED LEASEABLE AREA.
(5) DENOTES UNDEVELOPED LAND.
(6) SOLD OR TERMINATED SUBSEQUENT TO DECEMBER 31, 2003.
(7) DENOTES PROPERTY INTEREST IN KIMCO INCOME REIT ("KIR").
(8) DENOTES PROPERTY INTEREST IN KIMCO RETAIL OPPORTUNITY PORTFOLIO
("KROP").
(9) DENOTES PROPERTY INTEREST IN KIMSOUTH REALTY, INC.
(10) THE COMPANY HOLDS INTERESTS IN VARIOUS RETAIL STORE LEASES RELATED TO
THE ANCHOR STORE PREMISES IN NEIGHBORHOOD AND COMMUNITY SHOPPING
CENTERS.
(11) DOES NOT INCLUDE 3.9 MILLION SQUARE FEET RELATED TO THE PREFERRED
EQUITY PROGRAM AND 4.9 MILLION SQUARE FEET OF PROJECTED LEASEABLE AREA
RELATED TO THE GROUND-UP DEVELOPMENT PROJECTS.
27
Executive Officers of the Registrant
The following table sets forth information with respect to the executive
officers of the Company as of January 30, 2004.
Name Age Position Since
---- --- -------- -----
Milton Cooper 75 Chairman of the Board of 1991
Directors and Chief
Executive Officer
Michael J. Flynn 68 Vice Chairman of the 1996
Board of Directors and
President and Chief 1997
Operating Officer
David B. Henry 55 Vice Chairman of the 2001
Board of Directors and
Chief Investment Officer
Thomas A. Caputo 57 Executive Vice President 2000
Glenn G. Cohen 40 Vice President - 2000
Treasurer 1997
Raymond Edwards 41 Vice President - 2001
Retail Property Solutions
Jerald Friedman 59 President, KDI and 2000
Executive Vice President 1998
Bruce M. Kauderer 57 Vice President - Legal 1995
General Counsel and 1997
Secretary
Michael V. Pappagallo 45 Vice President - 1997
Chief Financial Officer
Michael J. Flynn has been President and Chief Operating Officer since January 2,
1997, Vice Chairman of the Board of Directors since January 2, 1996 and a
Director of the Company since December 1, 1991. Mr. Flynn was Chairman of the
Board and President of Slattery Associates, Inc. for more than five years prior
to joining the Company.
David B. Henry has been Chief Investment Officer since April 2001 and Vice
Chairman of the Board of Directors since May 2001. Mr. Henry served as the Chief
Investment Officer and Senior Vice President of General Electric's GE Capital
Real Estate business and Chairman of GE Capital Investment Advisors for more
than five years prior to joining the Company.
Thomas A. Caputo has been Executive Vice President of the Company since December
2000. Mr. Caputo was a principal with H & R Retail from January 2000 to December
2000. Mr. Caputo was a principal with the RREEF Funds, a pension advisor, for
more than five years prior to January 2000.
Glenn G. Cohen has been a Vice President of the Company since May 2000 and
Treasurer of the Company since June 1997. Mr. Cohen served as Director of
Accounting and Taxation of the Company from June 1995 to June 1997. Prior to
joining the Company in June 1995, Mr. Cohen served as Chief Operating Officer
and Chief Financial Officer for U.S. Balloon Manufacturing Co., Inc. from August
1993 to June 1995.
Raymond Edwards has been Vice President - Retail Property Solutions since July
2001. Prior to joining the Company in July 2001, Mr. Edwards was Senior Vice
President, Managing Director of SBC Group from 1998 to July 2001. SBC Group is a
privately held company that acquires and invests in assets of retail companies.
Previously, Mr. Edwards worked for 13 years at Keen Realty Consultants Inc.
responsible for the marketing and disposition of real estate for retail
operators including Caldor, Bonwit Teller, Alexander's and others.
Jerald Friedman has been President of the Company's KDI subsidiary since April
2000 and Executive Vice President of the Company since June 1998. Mr. Friedman
was Senior Executive Vice President and Chief Operating Officer of The Price
REIT, Inc. from January 1997 to June 1998. From 1994 through 1996, Mr. Friedman
was the Chairman and Chief Executive Officer of K & F Development Company, an
affiliate of The Price REIT, Inc.
28
Bruce M. Kauderer has been a Vice President of the Company since June 1995 and
since December 15, 1997, General Counsel and Secretary of the Company. Mr.
Kauderer was a founder of and partner with Kauderer & Pack P.C. from 1992 to
June 1995.
Michael V. Pappagallo has been a Vice President and Chief Financial Officer of
the Company since May 27, 1997. Mr. Pappagallo was Chief Financial Officer of GE
Capital's Commercial Real Estate Financial and Services business from September
1994 to May 1997 and held various other positions within GE Capital for more
than five years prior to joining the Company.
The executive officers of the Company serve in their respective capacities for
approximate one-year terms and are subject to re-election by the Board of
Directors, generally at the time of the Annual Meeting of the Board of Directors
following the Annual Meeting of Stockholders.
29
PART II
Item 5. Market for the Registrant's Common Equity and Related Shareholder
Matters
Market Information The following table sets forth the common stock offerings
completed by the Company during the three year period ended December 31, 2003.
The Company's common stock was sold for cash at the following offering prices
per share.
Offering Date Offering Price
------------- --------------
November 2001 $32.85
December 2001 $33.57
June 2003 $36.72
September 2003 $40.83
The table below sets forth, for the quarterly periods indicated, the high and
low sales prices per share reported on the NYSE Composite Tape for the Company's
common stock. The Company's common stock is traded under the trading symbol
"KIM".
Stock Price
-----------
Period High Low
------ ---- ----
2002:
First Quarter $33.50 $29.00
Second Quarter $33.87 $31.00
Third Quarter $33.20 $25.96
Fourth Quarter $32.08 $27.77
2003:
First Quarter $36.00 $30.25
Second Quarter $39.45 $34.47
Third Quarter $43.35 $37.21
Fourth Quarter $45.86 $40.26
Holders The number of holders of record of the Company's common stock, par
value $0.01 per share, was 1,224 as of January 30, 2004.
Dividends Since the IPO, the Company has paid regular quarterly dividends to
its stockholders.
Quarterly dividends at the rate of $0.52 per share were declared and paid on
January 2, 2002 and January 15, 2002, March 15, 2002 and April 15, 2002, June
17, 2002 and July 15, 2002, September 16, 2002 and October 15, 2002,
respectively. On October 28, 2002, the Company declared its dividend payable
during the first quarter of 2003 at an increased rate of $0.54 per share payable
on January 15, 2003 to shareholders of record as of January 2, 2003. Quarterly
dividends at the rate of $0.54 per share were declared and paid on March 17,
2003 and April 15, 2003, June 16, 2003 and July 15, 2003, September 15, 2003 and
October 15, 2003, respectively. On October 23, 2003, the Company declared its
dividend payable during the first quarter of 2004 at an increased rate of $0.57
per share payable on January 15, 2004 to the shareholders of record as of
January 2, 2004. This $0.57 per share dividend, if annualized, would equal $2.28
per share or an annual yield of approximately 4.9% based on the closing price of
$46.13 of the Company's common stock on the NYSE as of January 30, 2004.
The Company has determined that the $2.16 dividend per common share paid during
2003 represented 74% ordinary income, 14% capital gain and 12% return of capital
to its stockholders and the $2.08 dividend per common share paid during 2002
represented 96% ordinary income and 4% return of capital to its stockholders.
While the Company intends to continue paying regular quarterly dividends, future
dividend declarations will be at the discretion of the Board of Directors and
will depend on the actual cash flow of the Company, its financial condition,
capital requirements, the annual distribution requirements under the REIT
provisions of the Code and such other factors as the Board of Directors deems
relevant. The actual cash flow available to pay dividends will be affected by a
number of factors, including the revenues received from rental properties, the
operating expenses of the Company, the interest expense on its borrowings, the
ability of lessees to meet their obligations to the Company and any
unanticipated capital expenditures.
30
In addition to its common stock offerings, the Company has capitalized the
growth in its business through the issuance of unsecured fixed and floating-rate
medium-term notes, underwritten bonds, mortgage debt and construction loans,
convertible preferred stock and perpetual preferred stock. Borrowings under the
Company's revolving credit facilities have also been an interim source of funds
to both finance the purchase of properties and other investments and meet any
short-term working capital requirements. The various instruments governing the
Company's issuance of its unsecured public debt, bank debt, mortgage debt and
preferred stock impose certain restrictions on the Company with regard to
dividends, voting, liquidation and other preferential rights available to the
holders of such instruments. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and Notes 13 and 18 of the Notes
to Consolidated Financial Statements included in this annual report on Form
10-K.
The Company does not believe that the preferential rights available to the
holders of its Class F Preferred Stock, the financial covenants contained in its
public bond Indenture, as amended, bridge facility, or its revolving credit
agreement will have an adverse impact on the Company's ability to pay dividends
in the normal course to its common stockholders or to distribute amounts
necessary to maintain its qualification as a REIT.
The Company maintains a dividend reinvestment and direct stock purchase plan
(the "Plan") pursuant to which common and preferred stockholders and other
interested investors may elect to automatically reinvest their dividends to
purchase shares of the Company's common stock or, through optional cash
payments, purchase shares of the Company's common stock. The Company may, from
time to time, either (i) purchase shares of its common stock in the open market,
or (ii) issue new shares of its common stock, for the purpose of fulfilling its
obligations under the Plan.
Item 6. Selected Financial Data
The following table sets forth selected, historical consolidated financial data
for the Company and should be read in conjunction with the Consolidated
Financial Statements of the Company and Notes thereto and Management's
Discussion and Analysis of Financial Condition and Results of Operations
included in this annual report on Form 10-K.
The Company believes that the book value of its real estate assets, which
reflects the historical costs of such real estate assets less accumulated
depreciation, is not indicative of the current market value of its properties.
Historical operating results are not necessarily indicative of future operating
performance.
31
Year ended December 31, (2)
------------------------------------------------------------------------------
2003 2002 2001 2000 1999
---- ---- ---- ---- ----
(in thousands, except per share information)
Operating Data:
Revenues from rental property (1) $ 479,664 $ 432,777 $ 431,498 $ 423,623 $ 401,252
Interest expense(3) $ 102,709 $ 85,323 $ 87,005 $ 90,858 $ 83,479
Depreciation and amortization(3) $ 86,237 $ 70,894 $ 68,509 $ 66,375 $ 62,635
Gain on sale of development properties $ 17,495 $ 15,880 $ 13,418 $ - $ -
Gain on sale of operating properties(3) $ 3,177 $ - $ - $ 3,962 $ 1,552
Provision for income taxes $ 8,514 $ 12,904 $ 19,376 $ - $ -
Income from continuing operations $ 233,781 $ 234,242 $ 207,256 $ 187,897 $ 160,749
Income per common share, from continuing
operations:
Basic $ 2.10 $ 2.16 $ 2.01 $ 1.74 $ 1.48
Diluted $ 2.07 $ 2.14 $ 1.98 $ 1.73 $ 1.47
Weighted average number of shares of common stock:
Basic 107,092 104,458 96,317 92,688 90,709
Diluted 108,770 105,969 101,163 93,653 91,466
Cash dividends declared per common share $ 2.19 $ 2.10 $ 1.96 $ 1.81 $ 1.64
December 31,
------------------------------------------------------------------------------
2003 2002 2001 2000 1999
---- ---- ---- ---- ----
Balance Sheet Data:
Real estate, before accumulated depreciation $ 4,136,524 $ 3,398,971 $ 3,201,364 $ 3,114,503 $ 2,951,050
Total assets $ 4,603,925 $ 3,758,350 $ 3,387,342 $ 3,175,294 $ 3,011,297
Total debt $ 2,154,948 $ 1,576,982 $ 1,328,079 $ 1,325,663 $ 1,249,571
Total stockholders' equity $ 2,135,846 $ 1,908,800 $ 1,892,647 $ 1,708,285 $ 1,609,256
Cash flow provided by operations $ 308,632 $ 278,931 $ 287,444 $ 250,546 $ 237,153
Cash flow used for investing activities $ (642,365) $ (396,655) $ (157,193) $ (191,626) $ (205,219)
Cash flow (used for) provided by financing activities $ 346,059 $ 59,839 $ (55,501) $ (67,899) $ (47,778)
(1) Does not include (i) revenues from rental property relating to
unconsolidated joint ventures, (ii) revenues relating to the investment in
retail stores leases and (iii) revenues from properties included in discontinued
operations.
(2) All years have been adjusted to reflect the impact of operating properties
sold during 2003 and 2002 and properties classified as held for sale as of
December 31, 2003 which are reflected in discontinued operations in the
Consolidated Statements of Income.
(3) Does not include amounts reflected in Discontinued operations.
32
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations
The following discussion should be read in conjunction with the Consolidated
Financial Statements and Notes thereto included in this annual report on Form
10-K. Historical results and percentage relationships set forth in the
Consolidated Statements of Income contained in the Consolidated Financial
Statements, including trends which might appear, should not be taken as
indicative of future operations.
Executive Summary
Kimco Realty Corporation is one of the nation's largest publicly-traded owners
and operators of neighborhood and community shopping centers. As of February 5,
2004, the Company's portfolio was comprised of 699 property interests, including
620 shopping center properties (including 26 property interests relating to the
Company's Preferred Equity program), 36 retail store leases, 33 ground-up
development projects and ten undeveloped parcels of land, totaling approximately
102.6 million square feet of leasable space (including 3.9 million square feet
related to the Company's Preferred Equity program and 4.9 million square feet
projected for the ground-up development projects) located in 41 states, Canada
and Mexico.
The Company is self-administered and self-managed through present management,
which has owned and managed neighborhood and community shopping centers for over
40 years. The executive officers are engaged in the day-to-day management and
operation of real estate exclusively with the Company, with nearly all-operating
functions, including leasing, asset management, maintenance, construction,
legal, finance and accounting administered by the Company.
Additionally, in connection with the Tax Relief Extension Act of 1999 (the
"RMA"), which became effective January 1, 2001, the Company is now permitted to
participate in activities which it was precluded from previously in order to
maintain its qualification as a Real Estate Investment Trust ("REIT"), so long
as these activities are conducted in entities which elect to be treated as
taxable subsidiaries under the Code, subject to certain limitations. As such,
the Company, through its taxable REIT subsidiaries, is engaged in various retail
real estate related opportunities including (i) merchant building, through its
Kimco Developers, Inc. ("KDI") subsidiary, which is primarily engaged in the
ground-up development of neighborhood and community shopping centers and the
subsequent sale thereof upon completion (ii) retail real estate advisory and
disposition services which primarily focuses on leasing and disposition
strategies of retail real estate controlled by both healthy and distressed
and/or bankrupt retailers and (iii) acting as an agent or principal in
connection with tax deferred exchange transactions. The Company will consider
other investments through taxable REIT subsidiaries should suitable
opportunities arise.
The Company's strategy is to maintain a strong balance sheet while investing
opportunistically and selectively. The Company intends to continue to execute
its plan of delivering solid growth in earnings and dividends. As a result of
the improved 2003 performance, the Board of Directors increased the quarterly
dividend to $0.57 from $0.54 effective for the first quarter of 2004.
Critical Accounting Policies
The Consolidated Financial Statements of the Company include the accounts of the
Company, its wholly-owned subsidiaries and all partnerships in which the Company
has a controlling interest. The preparation of financial statements in
conformity with accounting principles generally accepted in the United States
requires management to make estimates and assumptions in certain circumstances
that affect amounts reported in the accompanying Consolidated Financial
Statements and related notes. In preparing these financial statements,
management has made its best estimates and assumptions that affect the reported
amounts of assets and liabilities. These estimates are based on, but not limited
to, historical results, industry standards and current economic conditions,
giving due consideration to materiality. The most significant assumptions and
estimates relate to revenue recognition and the recoverability of trade accounts
receivable, depreciable lives and valuation of real estate. Application of these
assumptions requires the exercise of judgment as to future uncertainties and, as
a result, actual results could differ from these estimates.
33
Revenue Recognition and Accounts Receivable
Base rental revenues from rental property are recognized on a straight-line
basis over the terms of the related leases. Certain of these leases also provide
for percentage rents based upon the level of sales achieved by the lessee. These
percentage rents are recorded once the required sales level is achieved. In
addition, leases typically provide for reimbursement to the Company of common
area maintenance, real estate taxes and other operating expenses. Operating
expense reimbursements are recognized as earned. Rental income may also include
payments received in connection with lease termination agreements.
The Company makes estimates of the uncollectability of its accounts receivable
related to base rents, expense reimbursements and other revenues. The Company
analyzes accounts receivable and historical bad debt levels, customer credit
worthiness and current economic trends when evaluating the adequacy of the
allowance for doubtful accounts. In addition, tenants in bankruptcy are analyzed
and estimates are made in connection with the expected recovery of pre-petition
and post-petition claims. The Company's reported net income is directly affected
by management's estimate of the collectability of accounts receivable.
Real Estate
Upon acquisition of operating real estate properties, the Company estimates the
fair value of acquired tangible assets (consisting of land, building and
improvements) and identified intangible assets and liabilities (consisting of
above and below-market leases, in-place leases and tenant relationships) and
assumed debt in accordance with Statement of Financial Accounting Standards No.
141, Business Combinations ("SFAS No. 141"). Based on these estimates, the
Company allocates the purchase price to the applicable assets and liabilities.
The Company utilized methods similar to those used by independent appraisers in
estimating the fair value of acquired assets and liabilities. The useful lives
of amortizable intangible assets are evaluated each reporting period with any
changes in estimated useful lives being accounted for over the revised remaining
useful life.
The Company's investments in real estate properties are carried at cost, less
accumulated depreciation and amortization. Expenditures for maintenance and
repairs are charged to operations as incurred. Significant renovations and
replacements, which improve and extend the life of the asset, are capitalized.
Depreciation and amortization are provided on the straight-line method over the
estimated useful lives of the assets, as follows:
Buildings 15 to 46 years
Fixtures, building and leasehold improvements Terms of leases or useful
(including certain identified intangible assets) lives, whichever is
shorter
The Company is required to make subjective assessments as to the useful lives of
its properties for purposes of determining the amount of depreciation to reflect
on an annual basis with respect to those properties. These assessments have a
direct impact on the Company's net income.
Real estate under development on the Company's Consolidated Balance Sheets
represent ground-up development projects which are held for sale upon
completion. These assets are carried at cost and no depreciation is recorded.
The cost of land and buildings under development include specifically
identifiable costs. The capitalized costs include pre-construction costs
essential to the development of the property, development costs, construction
costs, interest costs, real estate taxes, salaries and related costs and other
costs incurred during the period of development. The Company ceases cost
capitalization when the property is held available for occupancy upon
substantial completion of tenant improvements, but no later than one year from
the completion of major construction activity. If in management's opinion, the
estimated net sales price of these assets is less than the net carrying value,
an adjustment to the carrying value would be recorded to reflect the estimated
fair value of the property. A gain on the sale of these assets is generally
recognized using the full accrual method in accordance with the provisions of
Statement of Financial Accounting Standards No. 66, Accounting for Real Estate
Sales.
Long Lived Assets
On a periodic basis, management assesses whether there are any indicators that
the value of the real estate properties (including any related amortizable
intangible assets or liabilities) may be impaired. A property value is
considered impaired only if management's estimate of current and projected
operating cash flows (undiscounted and without interest charges) of the property
over its remaining useful life is less than the net carrying value of the
property. Such cash flow projections consider factors such as expected future
operating income, trend and prospects, as well as the effects of demand,
competition and other factors. To the extent impairment has occurred, the
carrying value of the property would be adjusted to an amount to reflect the
estimated fair value of the property.
34
When a real estate asset is identified by management as held for sale the
Company ceases depreciation of the asset and estimates the sales price of such
asset net of selling costs. If, in management's opinion, the net sales price of
the asset is less than the net book value of such asset, an adjustment to the
carrying value would be recorded to reflect the estimated fair value of the
property.
The Company is required to make subjective assessments as to whether there are
impairments in the value of its real estate properties, investments in joint
ventures and other investments. The Company's reported net income is directly
affected by management's estimate of impairments and/or valuation allowances.
Results of Operations
Comparison 2003 to 2002
Revenues from rental property increased $46.9 million or 10.8% to $479.7 million
for the year ended December 31, 2003, as compared with $432.8 million for the
year ended December 31, 2002. This net increase resulted primarily from the
combined effect of (i) the acquisition of 55 operating properties during 2003,
including 41 operating properties acquired in the Mid-Atlantic Merger, providing
revenues of $34.2 million for the year ended December 31, 2003, (ii) the full
year impact related to the 13 operating properties acquired in 2002 providing
incremental revenues of $16.6 million, and (iii) an overall increase in shopping
center portfolio occupancy to 90.7% at December 31, 2003 as compared to 87.8% at
December 31, 2002 and the completion of certain development and redevelopment
projects, providing incremental revenues of approximately $18.1 million as
compared to the corresponding year ended December 31, 2002, offset by (iv) a
decrease in revenues of approximately $8.4 million resulting from the bankruptcy
filing of Kmart Corporation ("Kmart") and subsequent rejection of leases, and
(v) sales of certain development properties and tenant buyouts resulting in a
decrease of revenues of approximately $13.6 million as compared to the preceding
year.
Rental property expenses including depreciation and amortization increased $25.7
million or 13.8% to $212.7 million for the year ended December 31, 2003 as
compared to $187.0 million for the preceding year. The rental property expense
components of operating and maintenance and depreciation and amortization
increased approximately $24.8 million or 21.5% for the year ended December 31,
2003 as compared with the year ended December 31, 2002. This increase is
primarily due to property acquisitions during 2003 and 2002 and increased snow
removal costs during 2003.
Income from other real estate investments increased $6.8 million to $22.8
million as compared to $16.0 million for the preceding year. This increase is
primarily due to increased investment in the Company's preferred equity program
contributing $4.6 million during 2003 as compared to $1.0 million in 2002,
contribution of $12.1 million from the Kimsouth investment resulting from the
disposition of 14 investment properties during 2003, offset by a decrease in
income of $7.8 million from the Montgomery Ward Asset Designation rights
transaction.
Management and other fee income increased approximately $3.2 million to $15.3
million for the year ended December 31, 2003 as compared to $12.1 million for
the year ended December 31, 2002. This increase is primarily due to (i)
increased management and acquisition fees resulting from the growth of the KROP
portfolio, (ii) increased management fees from KIR resulting from the growth of
the KIR portfolio, and (iii) increased property management activity providing
incremental fee income of approximately $1.1 million for the year ended December
31, 2003 as compared to the preceding year.
Interest expense increased $17.4 million or 20.4% to $102.7 million for the year
ended December 31, 2003, as compared with $85.3 million for the year ended
December 31, 2002. This increase is primarily due to an overall increase in
borrowings during the year ended December 31, 2003 as compared to the preceding
year, including additional borrowings and assumption of mortgage debt totaling
approximately $616.0 million in connection with the Mid-Atlantic Merger.
General and administrative expenses increased approximately $7.1 million for the
year ended December 31, 2003, as compared to the preceding calendar year. This
increase is primarily due to (i) increased staff levels related to the growth of
the Company, and (ii) other personnel related costs, associated with a
realignment of our regional operations.
35
During 2003, the Company reached agreement with certain lenders in connection
with three individual non-recourse mortgages encumbering three former Kmart
sites. The Company paid approximately $14.2 million in full satisfaction of
these loans which aggregated approximately $24.0 million. As a result of these
transactions, the Company recognized a gain on early extinguishment of debt of
approximately $9.7 million during 2003.
During December 2002, the Company reached agreement with certain lenders in
connection with four individual non-recourse mortgages encumbering four former
Kmart sites. The Company paid approximately $24.2 million in full satisfaction
of these loans which aggregated approximately $46.5 million. The Company
recognized a gain on early extinguishment of debt of approximately $22.3 million
for the year ended December 31, 2002.
As part of the Company's periodic assessment of its real estate properties with
regard to both the extent to which such assets are consistent with the Company's
long-term real estate investment objectives and the performance and prospects of
each asset, the Company determined in 2002, that its investment in four
operating properties, comprised of an aggregate 0.4 million square feet of GLA
with an aggregate net book value of approximately $23.8 million, may not be
fully recoverable. Based upon management's assessment of current market
conditions and the lack of demand for the properties, the Company has reduced
its potential holding period of these investments. As a result of the reduction
in the anticipated holding period, together with a reassessment of the projected
future operating cash flows of the properties and the effects of current market
conditions, the Company has determined that its investment in these assets was
not fully recoverable and has recorded an adjustment of property carrying value
aggregating approximately $12.5 million for the year ended December 31, 2002.
Approximately $1.5 million relating to the adjustment of property carrying value
for one of these properties is included in the caption Income from discontinued
operations on the Company's Consolidated Statements of Income.
Provision for income taxes decreased $4.4 million to $8.5 million for the year
ended December 31, 2003, as compared with $12.9 million for the year ended
December 31, 2002. This decrease is primarily due to less taxable income
provided by the Montgomery Ward Asset Designation Rights transaction in 2003 as
compared to 2002.
Equity in income of real estate joint ventures, net increased $4.6 million to
$42.3 million for the year ended December 31, 2003, as compared to $37.7 million
for the year ended December 31, 2002. This increase is primarily attributable to
the equity in income from the Kimco Income REIT joint venture investment, the
RioCan joint venture investment, and the KROP joint venture investment as
described below.
During 1998, the Company formed KIR, a limited partnership established to invest
in high quality retail properties financed primarily through the use of
individual non-recourse mortgages. The Company has a 43.3% non-controlling
limited partnership interest in KIR, which the Company manages, and accounts for
its investment in KIR under the equity method of accounting. Equity in income of
KIR increased $1.6 million to $19.8 million for the year ended December 31,
2003, as compared to $18.2 million for the preceding year. This increase is
primarily due to the Company's increased capital investment in KIR totaling
$13.0 million during 2003 and $23.8 million during 2002. The additional capital
investments received by KIR from the Company and its other institutional
partners were used to purchase additional shopping center properties throughout
calendar year 2003 and 2002.
During October 2001, the Company formed a joint venture (the "RioCan Venture")
with RioCan Real Estate Investment Trust ("RioCan", Canada's largest publicly
traded REIT measured by gross leasable area ("GLA")), in which the Company has a
50% non-controlling interest, to acquire retail properties and development
projects in Canada. As of December 31, 2003, the RioCan Venture consisted of 31
shopping center properties and three development projects with approximately 7.2
million square feet of GLA. The Company's equity in income from the RioCan
Venture increased approximately $3.4 million to $12.5 million for the year ended
December 31, 2003, as compared to $9.1 million for the preceding year.
During October 2001, the Company formed the Kimco Retail Opportunity Portfolio
("KROP"), a joint venture with GE Capital Real Estate ("GECRE") which the
Company manages and has a 20% non-controlling interest. The purpose of this
venture is to acquire established, high-growth potential retail properties in
the United States. As of December 31, 2003, KROP consisted of 23 shopping center
properties with approximately 3.5 million square feet of GLA. The Company's
equity in income from the KROP Venture increased approximately $1.0 million to
$2.0 million for the year ended December 31, 2003, as compared to $1.0 million
for the preceding year.
36
Minority interests in income of partnerships, net increased $5.5 million to $7.9
million as compared to $2.4 million for the preceding year. This increase is
primarily due to the full year effect of the acquisition of a shopping center
property acquired during October 2002, through a newly formed partnership by
issuing approximately 2.4 million downREIT units valued at $80 million. The
downREIT units are convertible at a ratio of 1:1 into the Company's common stock
and are entitled to a distribution equal to the dividend rate on the Company's
common stock multiplied by 1.1057.
During 2003, the Company disposed of, in separate transactions, (i) 10 operating
shopping center properties, for an aggregate sales price of approximately $119.1
million, including the assignment of approximately $1.7 million of mortgage debt
encumbering one of the properties, (ii) two regional malls for an aggregate
sales price of approximately $135.6 million, (iii) one out-parcel for a sales
price of approximately $8.1 million, (iv) transferred three operating properties
to KROP for a price of approximately $144.2 million which approximated their net
book value, (v) transferred an operating property to a newly formed joint
venture in which the Company has a non-controlling 10% interest for a price of
approximately $21.9 million which approximated its net book value and (vi)
terminated four leasehold positions in locations which a tenant in bankruptcy
had rejected its lease. These transactions resulted in net gains of
approximately $50.8 million.
For those property dispositions for which SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets ("SFAS No. 144") is applicable, the
operations and gain or loss on the sale of the property have been included in
the caption Discontinued operations on the Company's Consolidated Statements of
Income.
During 2003, the Company identified two operating properties, comprised of
approximately 0.2 million square feet of GLA, as "Held for Sale" in accordance
with SFAS No. 144. The book value of these properties, aggregating approximately
$19.5 million, net of accumulated depreciation of approximately $2.0 million,
exceeded their estimated fair value. The Company's determination of the fair
value of these properties, aggregating approximately $15.4 million, is based
upon contracts of sale with third parties less estimated selling costs. As a
result, the Company recorded an adjustment of property carrying values of $4.0
million. This adjustment is included, along with the related property operations
for the current and comparative years, in the caption Income from discontinued
operations on the Company's Consolidated Statements of Income.
During 2002, the Company identified two operating properties, comprised of
approximately 0.2 million square feet of GLA, as "Held for Sale" in accordance
with SFAS No. 144. The book value of these properties, aggregating approximately
$28.4 million, net of accumulated depreciation of approximately $2.9 million,
exceeded their estimated fair value. The Company's determination of the fair
value of these properties, aggregating approximately $7.9 million, is based upon
executed contracts of sale with third parties less estimated selling costs. As a
result, the Company recorded an adjustment of property carrying values of $20.5
million. This adjustment is included, along with the related property operations
for the current and comparative years, in the caption Income from discontinued
operations on the Company's Consolidated Statements of Income.
Effective January 1, 2001, the Company has elected taxable REIT subsidiary
status for its wholly-owned development subsidiary, KDI. KDI is primarily
engaged in the ground-up development of neighborhood and community shopping
centers and the subsequent sale thereof upon completion. During the year ended
December 31, 2003, KDI sold four projects and 26 out-parcels, in separate
transactions, for approximately $134.6 million. These sales resulted in pre-tax
gains of approximately $17.5 million.
During the year ended December 31, 2002, KDI sold four of its recently completed
projects and eight out-parcels, in separate transactions, for approximately
$128.7 million, including the assignment of approximately $17.7 million of
mortgage debt encumbering one of the properties which resulted in pre-tax
profits of $15.9 million.
Net income for the year ended December 31, 2003 was $307.9 million as compared
to $245.7 million for the year ended December 31, 2002. On a diluted per share
basis, net income increased $0.46 to $2.62 for the year ended December 31, 2003
as compared to $2.16 for the preceding year. This improved performance is
primarily attributable to (i) the acquisition of operating properties, including
the Mid-Atlantic Merger, during 2003 and 2002, (ii) significant leasing within
the portfolio which improved operating profitability, (iii) increased
contributions from KIR, the RioCan Venture and KROP, (iv) increased gains on
development sales from KDI, and (v) increased gains from operating property
sales of $50.8 million in 2003 as compared to $12.8 million in 2002. The 2003
improvement also includes the impact from gains on early extinguishment of debt
of $9.7 million in 2003 as compared to $22.3 million in 2002 and adjustments to
property carrying values of $4.0 million in 2003 and $33.0 million in 2002. The
2003 diluted per share results were decreased by a reduction in net income
available to common shareholders of $0.07 resulting from the deduction of
original issuance costs associated with the redemption of the Company's 7 3/4%
Class A, 8 1/2% Class B and 8 3/8% Class C Cumulative Redeemable Preferred
Stocks during the second quarter of 2003.
37
Comparison 2002 to 2001
Revenues from rental property increased $1.3 million or 0.3% to $432.8 million
for the year ended December 31, 2002, as compared with $431.5 million for the
year ended December 31, 2001. This net increase resulted primarily from the
combined effect of (i) the acquisition of 13 operating properties during 2002,
providing revenues of $5.1 million for the year ended December 31, 2002, (ii)
the full year impact related to the three operating properties acquired in 2001
providing incremental revenues of $2.3 million, and (iii) the completion of
certain development and redevelopment projects, tenant buyouts and new leasing
within the portfolio providing incremental revenues of approximately $20.5
million as compared to the corresponding year ended December 31, 2001, offset by
(iv) an overall decrease in shopping center portfolio occupancy to 87.8% at
December 31, 2002 as compared to 90.4% at December 31, 2001 due primarily to the
bankruptcy filing of Kmart Corporation ("Kmart") and Ames Department Stores,
Inc. ("Ames") and subsequent rejection of leases resulting in a decrease of
revenues of approximately $24.2 million as compared to the preceding year, and
(v) sales of certain shopping center properties throughout 2001 and 2002,
resulting in a decrease of revenues of approximately $2.4 million as compared to
the preceding year.
Rental property expenses, including depreciation and amortization, increased
$10.2 million or 5.8% to $187.0 million for the year ended December 31, 2002 as
compared to $176.8 million for the preceding year. The rental property expense
component of real estate taxes increased approximately $6.4 million or 11.8% for
the year ended December 31, 2002 as compared with the year ended December 31,
2001. This increase relates primarily to the payment of real estate taxes by the
Company on certain Kmart anchored locations where Kmart previously paid the real
estate taxes directly to the taxing authorities. The rental property expense
component of operating and maintenance increased approximately $1.7 million or
4.1% for the year ended December 31, 2002 as compared with the year ended
December 31, 2001. This increase is primarily due to property acquisitions
during 2002 and 2001, renovations within the portfolio and higher professional
fees relating to tenant bankruptcies.
Income from other real estate investments decreased $22.1 million to $16.0
million as compared to $38.1 million for the preceding year. This decrease is
primarily due to the decrease in income from the Montgomery Ward asset
designation rights transactions described below.
During March 2001, the Company, through a taxable REIT subsidiary, formed a real
estate joint venture (the "Ward Venture") in which the Company has a 50%
interest, for purposes of acquiring asset designation rights for substantially
all of the real estate property interests of the bankrupt estate of Montgomery
Ward LLC and its affiliates. These asset designation rights have provided the
Ward Venture the ability to direct the ultimate disposition of the 315 fee and
leasehold interests held by the bankrupt estate, of which 303 transactions were
completed as of December 31, 2002. During the year ended December 31, 2002, the
Ward Venture completed transactions for 32 properties. The pre-tax profits from
the Ward Venture decreased approximately $23.3 million to $11.3 million for the
year ended December 31, 2002 as compared to $34.6 million for the preceding
year.
Mortgage financing income increased $16.8 million to $19.4 million for the year
ended December 31, 2002 as compared to $2.6 million for the year ended December
31, 2001. This increase is primarily due to increased interest income earned
related to certain real estate lending activities during the year ended December
31, 2002.
Management and other fee income increased approximately $5.7 million to $12.1
million for the year ended December 31, 2002 as compared to $6.4 million for the
year ended December 31, 2001. This increase is primarily due to (i) a $0.6
million increase in management fees from KIR resulting from the growth of the
KIR portfolio, (ii) $2.1 million of management and acquisition fees relating to
the KROP joint venture activities during the year ended December 31, 2002 and
(iii) increased property management activity providing incremental fee income of
approximately $3.0 million.
Other income/(expense), net increased approximately $4.7 million to $2.5 million
for the year ended December 31, 2002 as compared to the preceding calendar year.
This increase is primarily due to pre-tax profits earned from the Company's
participation in ventures established to provide inventory liquidation services
to regional retailers in bankruptcy.
38
Interest expense decreased $1.7 million or 1.9% to $85.3 million for the year
ended December 31, 2002, as compared with $87.0 million for the year ended
December 31, 2001. This decrease is primarily due to reduced interest costs on
the Company's floating-rate revolving credit facilities and remarketed reset
notes which was partially offset by an increase in borrowings during the year
ended December 31, 2002, as compared to the preceding year.
General and administrative expenses increased approximately $3.3 million for the
year ended December 31, 2002, as compared to the preceding calendar year. This
increase is primarily due to higher costs related to the growth of the Company
including (i) increased senior management and staff levels, (ii) increased
system related costs and (iii) other personnel related costs.
The Company had previously encumbered certain Kmart sites with individual
non-recourse mortgages as part of its strategy to reduce its exposure to Kmart
Corporation. As a result of the Kmart bankruptcy filing in January 2002 and the
subsequent rejection of leases including leases at these encumbered sites, the
Company, during July 2002, had suspended debt services payments on these loans
and was actively negotiating with the respective lenders. During December 2002,
the Company reached agreement with certain lenders in connection with four of
these locations. The Company paid approximately $24.2 million in full
satisfaction of these loans which aggregated approximately $46.5 million. The
Company recognized a gain on early extinguishment of debt of approximately $22.3
million.
As part of the Company's periodic assessment of its real estate properties with
regard to both the extent to which such assets are consistent with the Company's
long-term real estate investment objectives and the performance and prospects of
each asset, the Company determined in 2002, that its investment in four
operating properties, comprised of an aggregate 0.4 million square feet of GLA
with an aggregate net book value of approximately $23.8 million, may not be
fully recoverable. Based upon management's assessment of current market
conditions and the lack of demand for the properties, the Company has reduced
its potential holding period of these investments. As a result of the reduction
in the anticipated holding period, together with a reassessment of the projected
future operating cash flows of the properties and the effects of current market
conditions, the Company has determined that its investment in these assets was
not fully recoverable and has recorded an adjustment of property carrying value
aggregating approximately $12.5 million, of which approximately $1.5 million is
included in the caption Income from discontinued operations on the Company's
Consolidated Statements of Income. Equity in income of real estate joint
ventures, net increased $16.0 million to $37.7 million for the year ended
December 31, 2002, as compared to $21.7 million for the year ended December 31,
2001. This increase is primarily attributable to the equity in income from the
Kimco Income REIT joint venture investment, the RioCan joint venture investment,
and the KROP joint venture investment as described below.
During 1998, the Company formed KIR, a limited partnership established to invest
in high quality retail properties financed primarily through the use of
individual non-recourse mortgages. The Company has a 43.3% non-controlling
limited partnership interest in KIR, which the Company manages, and accounts for
its investment in KIR under the equity method of accounting. Equity in income of
KIR increased $3.5 million to $18.2 million for the year ended December 31,
2002, as compared to $14.7 million for the preceding year. This increase is
primarily due to the Company's increased capital investment in KIR totaling
$23.8 million during 2002 and $30.8 million during 2001. The additional capital
investments received by KIR from the Company and its other institutional
partners were used to purchase additional shopping center properties throughout
calendar year 2002 and 2001.
During October 2001, the Company formed a joint venture (the "RioCan Venture")
with RioCan Real Estate Investment Trust ("RioCan", Canada's largest publicly
traded REIT measured by gross leasable area ("GLA")), in which the Company has a
50% non-controlling interest, to acquire retail properties and development
projects in Canada. As of December 31, 2002, the RioCan Venture consisted of 28
shopping center properties and four development projects with approximately 6.7
million square feet of GLA. The Company's equity in income from the RioCan
Venture increased approximately $8.7 million to $9.1 million for the year ended
December 31, 2002, as compared to $0.4 million for the preceding year.
During October 2001, the Company formed the Kimco Retail Opportunity Portfolio
("KROP"), a joint venture with GE Capital Real Estate ("GECRE") which the
Company manages and has a 20% non-controlling interest. The purpose of this
venture is to acquire established, high-growth potential retail properties in
the United States. As of December 31, 2002, KROP consisted of 15 shopping center
properties with approximately 1.5 million square feet of GLA. During the year
ended December 31, 2002, the Company's equity in income from KROP was
approximately $1.0 million.
39
Minority interests in income of partnerships, net increased $0.7 million to $2.4
million as compared to $1.7 million for the preceding year. This increase is
primarily due to the acquisition of a shopping center property acquired through
a newly formed partnership by issuing approximately 2.4 million downREIT units
valued at $80 million. The downREIT units are convertible at a ratio of 1:1 into
the Company's common stock and are entitled to a distribution equal to the
dividend rate on the Company's common stock multiplied by 1.1057.
During 2002, the Company identified two operating properties, comprised of
approximately 0.2 million square feet of GLA, as "Held for Sale" in accordance
with SFAS No. 144. The book value of these properties, aggregating approximately
$28.4 million, net of accumulated depreciation of approximately $2.9 million,
exceeded their estimated fair value. The Company's determination of the fair
value of these properties, aggregating approximately $7.9 million, is based upon
executed contracts of sale with third parties less estimated selling costs. As a
result, the Company recorded an adjustment of property carrying values of $20.5
million. This adjustment is included, along with the related property operations
for the current and comparative years, in the caption Income from discontinued
operations on the Company's Consolidated Statements of Income.
During 2002, the Company, (i) disposed of, in separate transactions, 12
operating properties for an aggregate sales price of approximately $74.5
million, including the assignment/repayment of approximately $22.6 million of
mortgage debt encumbering three of the properties and, (ii) terminated five
leasehold positions in locations where a tenant in bankruptcy had rejected its
lease. These dispositions resulted in net gains of approximately $12.8 million
for the year ended December 31, 2002. In accordance with SFAS No. 144,
Accounting for the Impairment or Disposal of Long-Lived Assets ("SFAS No. 144"),
the operations and net gain on disposition of these properties have been
included in the caption Discontinued operations on the Company's Consolidated
Statements of Income.
During 2001, the Company, in separate transactions, disposed of three operating
properties, including the sale of a property to KIR, and a portion of another
operating property comprising in the aggregate approximately 0.6 million square
feet of GLA. Cash proceeds from these dispositions aggregated approximately
$46.7 million, which resulted in a net gain of approximately $3.0 million. Cash
proceeds from the sale of the operating property in Elyria, OH totaling $5.8
million, together with an additional $7.1 million cash investment, were used to
acquire an exchange shopping center property located in Lakeland, FL during
August 2001.
Effective January 1, 2001, the Company has elected taxable REIT subsidiary
status for its wholly-owned development subsidiary ("KDI"). KDI is primarily
engaged in the ground-up development of neighborhood and community shopping
centers and the subsequent sale thereof upon completion. During the year ended
December 31, 2002, KDI sold four projects and eight out-parcels, in separate
transactions, for approximately $128.7 million, including the assignment of
approximately $17.7 million of mortgage debt encumbering one of the properties.
These sales resulted in pre-tax gains of approximately $15.9 million.
During the year ended December 31, 2001, KDI sold two of its recently completed
projects and five out-parcels, in separate transactions, for approximately $61.3
million, which resulted in pre-tax profits of $13.4 million.
Net income for the year ended December 31, 2002 was $245.7 million as compared
to $236.5 million for the year ended December 31, 2001, representing an increase
of $9.2 million. This increase reflects the combined effect of increased
contributions from the investments in KIR, KROP, the RioCan Venture and other
financing investments, reduced by lower income resulting from tenant
bankruptcies and subsequent rejection of leases and a decrease in profits from
the Ward Venture.
Tenant Concentrations
The Company seeks to reduce its operating and leasing risks through
diversification achieved by the geographic distribution of its properties,
avoiding dependence on any single property, and a large tenant base. At December
31, 2003, the Company's five largest tenants were The Home Depot, Kmart
Corporation, Kohl's, Royal Ahold, and TJX Companies, which represented
approximately 3.0%, 2.9%, 2.8%, 2.6% and 2.5%, respectively, of the Company's
annualized base rental revenues, including the proportionate share of base
rental revenues from properties in which the Company has less than a 100%
economic interest.
40
On January 14, 2003, Kmart announced it would be closing 326 locations relating
to its January 22, 2002 filing of protection under Chapter 11 of the U.S.
Bankruptcy Code. Nine of these locations (excluding the KIR portfolio which
includes three additional locations and Kimsouth which includes two additional
locations) are leased from the Company. The annualized base rental revenues from
these nine locations are approximately $4.3 million. As of December 31, 2003,
Kmart rejected its lease at eight of these locations representing approximately
$3.8 million of annualized base rental revenues. The Company has signed a lease
at three of these sites, terminated its ground lease at another site, sold two
properties and continues to negotiate leases with prospective tenants at the two
remaining sites.
Liquidity and Capital Resources
It is management's intention that the Company continually have access to the
capital resources necessary to expand and develop its business. As such, the
Company intends to operate with and maintain a conservative capital structure
with a level of debt to total market capitalization of 50% or less. As of
December 31, 2003 the Company's level of debt to total market capitalization was
30%. In addition, the Company intends to maintain strong debt service coverage
and fixed charge coverage ratios as part of its commitment to maintaining its
investment-grade debt ratings. The Company may, from time to time, seek to
obtain funds through additional equity offerings, unsecured debt financings
and/or mortgage/construction loan financings and other debt and equity
alternatives in a manner consistent with its intention to operate with a
conservative debt structure.
Since the completion of the Company's IPO in 1991, the Company has utilized the
public debt and equity markets as its principal source of capital for its
expansion needs. Since the IPO, the Company has completed additional offerings
of its public unsecured debt and equity, raising in the aggregate over $3.3
billion for the purposes of, among other things, repaying indebtedness,
acquiring interests in neighborhood and community shopping centers, funding
ground-up development projects, expanding and improving properties in the
portfolio and other investments.
The Company has a $500.0 million unsecured revolving credit facility, which is
scheduled to expire in August 2006. This credit facility has made available
funds to both finance the purchase of properties and other investments and meet
any short-term working capital requirements. As of December 31, 2003 there was
$45.0 million outstanding under this credit facility.
The Company also has a $400.0 million unsecured bridge facility, which is
scheduled to expire in September 2004, with an option to extend up to $150.0
million for an additional year. Proceeds from this facility were used to
partially fund the Mid-Atlantic Realty Trust transaction. (See Recent
Developments - Mid-Atlantic Realty Trust Merger and Notes 3 and 13 of the Notes
to Consolidated Financial Statements included in this annual report on Form
10-K.) As of December 31, 2003, there was $329.0 million outstanding on this
unsecured bridge facility.
The Company has a $300.0 million MTN program pursuant to which it may, from time
to time, offer for sale its senior unsecured debt for any general corporate
purposes, including (i) funding specific liquidity requirements in its business,
including property acquisitions, development and redevelopment costs and (ii)
managing the Company's debt maturities. (See Note 13 of the Notes to
Consolidated Financial Statements included in this annual report on Form 10-K.)
In addition to the public equity and debt markets as capital sources, the
Company may, from time to time, obtain mortgage financing on selected properties
and construction loans to partially fund the capital needs of KDI, the Company's
merchant building subsidiary. As of December 31, 2003, the Company had over 400
unencumbered property interests in its portfolio.
During May 2003, the Company filed a shelf registration statement on Form S-3
for up to $1.0 billion of debt securities, preferred stock, depositary shares,
common stock and common stock warrants. As of December 31, 2003, the Company had
$609.7 million available for issuance under this shelf registration statement.
In connection with its intention to continue to qualify as a REIT for federal
income tax purposes, the Company expects to continue paying regular dividends to
its stockholders. These dividends will be paid from operating cash flows which
are expected to increase due to property acquisitions, growth in operating
income in the existing portfolio and from other investments. Since cash used to
pay dividends reduces amounts available for capital investment, the Company
generally intends to maintain a conservative dividend payout ratio, reserving
such amounts as it considers necessary for the expansion and renovation of
shopping centers in its portfolio, debt reduction, the acquisition of interests
in new properties and other investments as suitable opportunities arise, and
such other factors as the Board of Directors considers appropriate. Cash
dividends paid increased to $246.3 million in 2003, compared to $235.6 million
in 2002 and $209.8 million in 2001.
41
Although the Company receives substantially all of its rental payments on a
monthly basis, it generally intends to continue paying dividends quarterly.
Amounts accumulated in advance of each quarterly distribution will be invested
by the Company in short-term money market or other suitable instruments.
The Company anticipates its capital commitment toward redevelopment projects
during 2004 will be approximately $50.0 million to $75.0 million. Additionally,
the Company anticipates its capital commitment toward ground-up development
during 2004 will be approximately $160.0 million to $200.0 million. The proceeds
from the sales of development properties and proceeds from construction loans in
2004 should be sufficient to fund the ground-up development capital
requirements.
The Company anticipates that cash flows from operations will continue to provide
adequate capital to fund its operating and administrative expenses, regular debt
service obligations and all dividend payments in accordance with REIT
requirements in both the short-term and long-term. In addition, the Company
anticipates that cash on hand, borrowings under its revolving credit facility,
issuance of equity and public debt, as well as other debt and equity
alternatives, will provide the necessary capital required by the Company. Cash
flows from operations as reported in the Consolidated Statements of Cash Flows
was $308.6 million for 2003, $278.9 million for 2002 and $287.4 million for
2001.
Contractual Obligations and Other Commitments
The Company has debt obligations relating to its revolving credit facility,
bridge facility, MTNs, senior notes, mortgages and construction loans with
maturities ranging from less than one year to 20 years. As of December 31, 2003,
the Company's total debt had a weighted average term to maturity of
approximately 4.3 years. In addition, the Company has non-cancelable operating
leases pertaining to its shopping center portfolio. As of December 31, 2003, the
Company has certain shopping center properties that are subject to long-term
ground leases where a third party owns and has leased the underlying land to the
Company to construct and/or operate a shopping center. In addition, the Company
has non-cancelable operating leases pertaining to its retail store lease
portfolio. The following table summarizes the Company's debt maturities and
obligations under non-cancelable operating leases as of December 31, 2003 (in
millions):
2004 2005 2006 2007 2008 Thereafter Total
---- ---- ---- ---- ---- ---------- -----
Long-Term Debt $570.4 $244.6 $198.1 $207.6 $143.1 $791.2 $2,155.0
Operating Leases
Ground Leases $ 11.3 $ 10.9 $ 10.2 $ 9.9 $ 8.9 $153.5 $ 204.7
Retail Store Leases $ 7.9 $ 7.7 $ 6.3 $ 4.4 $ 2.7 $ 2.8 $ 31.8
The Company has $50.0 million of unsecured senior notes, $135.0 million of
medium term notes and $47.7 million of construction loans maturing in 2004. In
addition, the Company's unsecured bridge facility, which is scheduled to expire
in September 2004, with an option to extend up to $150.0 million for an
additional year, had $329.0 million outstanding as of December 31, 2003. The
Company anticipates satisfying these maturities with a combination of operating
cash flows, its unsecured revolving credit facility and new debt financings.
The Company has issued letters of credit in connection with the
collateralization of tax-exempt mortgage bonds, completion guarantees for
certain construction projects, and guaranty of payment related to the Company's
insurance program. These letters of credit aggregate approximately $15.3
million.
Additionally, the RioCan Venture, an entity in which the Company holds a 50%
non-controlling interest, has a CAD $5.0 million (approximately USD $3.9
million) letter of credit facility. This facility is jointly guaranteed by
RioCan and the Company and has approximately CAD $3.1 million (approximately USD
$2.4 million) outstanding as of December 31, 2003 relating to various
development projects.
During 2003, the Company obtained construction financing on seven ground-up
development projects for an aggregate loan commitment amount of up to $152.2
million. As of December 31, 2003, the Company had 13 construction loans with
total commitments of up to $238.9 million of which $92.8 million had been funded
to the Company. These loans have maturities ranging from 3 to 34 months and
interest rates ranging from 2.87% to 5.00% at December 31, 2003.
42
Off-Balance Sheet Arrangements
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Unconsolidated Real Estate Joint Ventures
The Company has investments in various unconsolidated real estate joint ventures
with varying structures. These investments include the Company's 43.3%
non-controlling interest in KIR, the Company's 50% non-controlling interest in
the RioCan Venture, the Company's 20% non-controlling interest in KROP, and
varying interests in other real estate joint ventures. These joint ventures
operate either shopping center properties or are established for development
projects. Such arrangements are generally with third party institutional
investors, local developers and individuals. The properties owned by the joint
ventures are primarily financed with individual non-recourse mortgage loans.
Non-recourse mortgage debt is generally defined as debt whereby the lenders'
sole recourse with respect to borrower defaults is limited to the value of the
property collateralized by the mortgage. The lender generally does not have
recourse against any other assets owned by the borrower or any of the
constituent members of the borrower, except for certain specified exceptions
listed in the particular loan documents.
The KIR joint venture was established for the purpose of investing in high
quality real estate properties financed primarily with individual non-recourse
mortgages. The Company believes that these properties are appropriate for
financing with greater leverage than the Company traditionally uses. As of
December 31, 2003, KIR had interests in 70 properties comprising 14.6 million
square feet of GLA. As of December 31, 2003, KIR had obtained individual
non-recourse mortgage loans on 68 of these properties. These non-recourse
mortgage loans have maturities ranging from 2 to 15 years and rates ranging from
3.23% to 8.52%. As of December 31, 2003, the Company's pro-rata share of
non-recourse mortgages relating to the KIR joint venture was approximately
$506.8 million. The Company also has unfunded capital commitments to KIR in the
amount of approximately $42.9 million as of December 31, 2003. (See Note 8 of
the Notes to Consolidated Financial Statements included in this annual report on
Form 10-K.)
The RioCan Venture was established with RioCan Real Estate Investment Trust to
acquire properties and development projects in Canada. As of December 31, 2003,
the RioCan Venture consisted of 31 shopping center properties and three
development projects with approximately 7.2 million square feet of GLA. As of
December 31, 2003, the RioCan Venture had obtained individual, non-recourse
mortgage loans on 27 of these properties aggregating approximately CAD $590.6
million (USD $453.3 million). These non-recourse mortgage loans have maturities
ranging from five months to 11 years and rates ranging from 5.12% to 8.70%. As
of December 31, 2003 the Company's pro-rata share of non-recourse mortgage loans
relating to the RioCan Venture was approximately CAD $295.3 million (USD $226.7
million). (See Note 8 of the Notes to Consolidated Financial Statements included
in this annual report on Form 10-K.)
The Kimco Retail Opportunity Portfolio ("KROP"), a joint venture with GE Capital
Real Estate ("GECRE") was established to acquire high-growth potential retail
properties in the United States. As of December 31, 2003, KROP consisted of 23
shopping center properties with approximately 3.5 million square feet of GLA. As
of December 31, 2003, KROP had non-recourse mortgage loans totaling $295.1
million with fixed rates ranging from 4.25% to 8.64% and variable rates ranging
from LIBOR plus 1.8% to LIBOR plus 2.5%. KROP has entered into a series of
interest rate cap agreements to mitigate the impact of changes in interest rates
on its variable rate mortgage agreements. Such mortgage debt is collateralized
by the individual shopping center property and is payable in monthly
installments of principal and interest. At December 31, 2003 the weighted
average interest rate for all mortgage debt outstanding was 5.04% per annum. As
of December 31, 2003, the Company's pro-rata share of non-recourse mortgage
loans relating to the KROP joint venture was approximately $59.0 million.
Additionally, the Company along with its joint venture partner have provided
interim financing ("Short-term Notes") for all acquisitions without a mortgage
in place at the time of closing. As of December 31, 2003 KROP has outstanding
Short-term Notes of $16.8 million due each the Company and GECRE. These
short-term notes all have maturities of less than one year with rates ranging
from LIBOR plus 4.0% to LIBOR plus 5.25%. (See Note 8 of the Notes to
Consolidated Financial Statements included in this annual report on Form 10-K.)
The Company has various other unconsolidated real estate joint ventures with
ownership interests ranging from 4% to 50%. As of December 31, 2003, these
unconsolidated joint ventures had individual non-recourse mortgage loans
aggregating approximately $425.0 million. The Company's pro-rata share of these
non-recourse mortgages was approximately $187.0 million. (See Note 8 of the
Notes to Consolidated Financial Statements included in this annual report on
Form 10-K.)
43
Other Real Estate Investments
During November 2002, the Company, through its taxable REIT subsidiary, together
with Prometheus Southeast Retail Trust, completed the merger and privatization
of Konover Property Trust, which has been renamed Kimsouth Realty, Inc.,
("Kimsouth"). The Company acquired 44.5% of the common stock of Kimsouth, which
consisted primarily of 38 retail shopping center properties comprising
approximately 4.6 million square feet of GLA. Total acquisition value was
approximately $280.9 million including approximately $216.2 million in mortgage
debt. The Company's investment strategy with respect to Kimsouth includes
re-tenanting, repositioning and disposition of the properties. As a result of
this strategy, Kimsouth has sold 16 properties as of December 31, 2003. The
Kimsouth portfolio is comprised of 22 properties totaling 3.2 million square
feet of GLA as of December 31, 2003 with non-recourse mortgage debt of
approximately $137.0 million encumbering the properties. All mortgages payable
are collateralized by certain properties and are due in monthly installments. As
of December 31, 2003, interest rates range from 2.88% to 9.22% and the weighted
average interest rate for all mortgage debt outstanding was 5.71% per annum. As
of December 31, 2003, the Company's pro-rata share of non-recourse mortgage
loans relating to the Kimsouth portfolio was approximately $61.0 million.
During June 2002, the Company acquired a 90% equity participation interest in an
existing leveraged lease of 30 properties. The properties are leased under a
long-term bond-type net lease whose primary term expires in 2016, with the
lessee having certain renewal option rights. The Company's cash equity
investment was approximately $4.0 million. This equity investment is reported as
a net investment in leveraged lease in accordance with SFAS No. 13, Accounting
for Leases (as amended). The net investment in leveraged lease reflects the
original cash investment adjusted by remaining net rentals, estimated
unguaranteed residual value, unearned and deferred income, and deferred taxes
relating to the investment.
As of December 31, 2003, eight of these properties were sold whereby the
proceeds from the sales were used to paydown the mortgage debt by approximately
$18.7 million. As of December 31, 2003, the remaining 22 properties were
encumbered by third-party non-recourse debt of approximately $73.6 million that
is scheduled to fully amortize during the primary term of the lease from a
portion of the periodic net rents receivable under the net lease. As an equity
participant in the leveraged lease, the Company has no recourse obligation for
principal or interest payments on the debt, which is collateralized by a first
mortgage lien on the properties and collateral assignment of the lease.
Accordingly, this debt has been offset against the related net rental receivable
under the lease.
Effects of Inflation
Many of the Company's leases contain provisions designed to mitigate the adverse
impact of inflation. Such provisions include clauses enabling the Company to
receive payment of additional rent calculated as a percentage of tenants' gross
sales above pre-determined thresholds, which generally increase as prices rise,
and/or escalation clauses, which generally increase rental rates during the
terms of the leases. Such escalation clauses often include increases based upon
changes in the consumer price index or similar inflation indices. In addition,
many of the Company's leases are for terms of less than 10 years, which permits
the Company to seek to increase rents to market rates upon renewal. Most of the
Company's leases require the tenant to pay an allocable share of operating
expenses, including common area maintenance costs, real estate taxes and
insurance, thereby reducing the Company's exposure to increases in costs and
operating expenses resulting from inflation. The Company periodically evaluates
its exposure to short-term interest rates and foreign currency exchange rates
and will, from time to time, enter into interest rate protection agreements
and/or foreign currency hedge agreements which mitigate, but do not eliminate,
the effect of changes in interest rates on its floating-rate debt and
fluctuations in foreign currency exchange rates.
New Accounting Pronouncements
In January 2003, the Financial Accounting Standards Board ("FASB") issued
Interpretation No. 46, Consolidation of Variable Interest Entities ("FIN 46"),
the primary objective of which is to provide guidance on the identification of
entities for which control is achieved through means other than voting rights
("variable interest entities" or "VIEs") and to determine when and which
business enterprise should consolidate the VIE (the "primary beneficiary"). This
new model applies when either (i) the equity investors (if any) do not have a
controlling financial interest or (ii) the equity investment at risk is
insufficient to finance that entity's activities without additional financial
support. In addition, effective upon issuance, FIN 46 requires additional
disclosures by the primary beneficiary and other significant variable interest
holders. The provisions of FIN 46 apply immediately to VIE's created after
January 31, 2003. In October 2003, the FASB issued FASB Staff Position 46-6,
which deferred the effective date to December 31, 2003 for applying the
provisions of FIN 46 for interests held by public companies in all VIEs created
prior to February 1, 2003. Additionally, in December 2003, the FASB issued
Interpretation No. 46(R), Consolidation of Variable Interest Entities (revised
December 2003) ("FIN 46(R)"). The provisions of FIN 46(R) are effective as of
March 31, 2004 for all non-special purpose entity ("non-SPE") interests held by
public companies in all variable interest entities created prior to February 1,
2003. These deferral provisions did not defer the disclosure provisions of FIN
46(R).
44
The Company has evaluated its joint venture investments established after
January 31, 2003 and based upon its interpretation of FIN 46 and applied
judgment, the Company has determined that these joint venture investments are
not VIEs and are not required to be consolidated.
The Company continues to evaluate all of its investments in joint ventures
created prior to February 1, 2003 to determine whether any of these entities are
VIEs and whether the Company is considered to be the primary beneficiary or a
holder of a significant variable interest in the VIE. If it is determined that
certain of these entities are VIEs the Company will be required to consolidate
those entities in which the Company is the primary beneficiary or make
additional disclosures for entities in which the Company is determined to hold a
significant variable interest in the VIE as of March 31, 2004.
The Company's joint ventures and other real estate investments primarily consist
of co-investments with institutional and other joint venture partners in
neighborhood and community shopping center properties, consistent with its core
business. These joint ventures typically obtain non-recourse third party
financing on their property investments, thus contractually limiting the
Company's losses to the amount of its equity investment, and due to the lender's
exposure to losses, a lender typically will require a minimum level of equity in
order to mitigate their risk. The Company's exposure to losses associated with
its unconsolidated joint ventures is limited to its carrying value in these
investments. (See Notes 8 and 9 of the Notes to Consolidated Financial
Statements included in this annual report on Form 10-K.)
In April 2003, the FASB issued Statement of Financial Accounting Standards
("SFAS") No. 149, Amendment of Statement 133 on Derivative Instruments and
Hedging Activities ("SFAS No. 149"). This statement amends and clarifies
financial accounting and reporting for derivative instruments, including certain
derivative instruments embedded in other contracts and for hedging activities
under FASB Statement No. 133, Accounting for Derivative Instruments and Hedging
Activities. The provisions of this statement are effective for contracts entered
into or modified after June 30, 2003, and for hedging relationships designated
after June 30, 2003. The adoption of SFAS No. 149 did not have a material
adverse impact on the Company's financial position or results of operations.
In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity ("SFAS No.
150"). This statement establishes standards for how an issuer classifies and
measures certain financial instruments with characteristics of both liabilities
and equity. It requires that an issuer classify a financial instrument that is
within its scope as a liability (or an asset in some circumstances). The
provisions of this statement are effective for financial instruments entered
into or modified after May 31, 2003, and otherwise are effective at the
beginning of the first interim period beginning after June 15, 2003. On November
7, 2003, the FASB deferred the classification and measurement provisions of SFAS
No. 150 as they apply to certain mandatorily redeemable non-controlling
interests. This deferral is expected to remain in effect while these provisions
are further evaluated by the SFAS. As a result of this deferral, the adoption of
SFAS No. 150 did not have a material adverse impact on the Company's financial
position or results of operations.
At December 31, 2003, the estimated fair value of minority interests relating to
mandatorily redeemable non-controlling interests associated with finite-lived
subsidiaries of the Company is approximately $3.9 million. These finite-lived
subsidiaries have termination dates ranging from 2019 to 2027.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
As of December 31, 2003, the Company had approximately $558.2 million of
floating-rate debt outstanding including $45.0 million on its unsecured
revolving credit facility, $85 million of unsecured MTN's due August 2004 and
$329.0 million on its bridge facility due September 2004. The Company believes
the interest rate risk on its floating-rate debt is not material to the Company
or its overall capitalization.
45
As of December 31, 2003, the Company has Canadian investments totaling CAD
$189.2 million (approximately USD $145.2 million) comprised of a real estate
joint venture and marketable securities. In addition, the Company has Mexican
real estate investments of MXN $330.3 million (approximately USD $29.4 million).
The foreign currency exchange risk has been mitigated through the use of foreign
currency forward contracts (the "Forward Contracts") and a cross currency swap
(the "CC Swap") with major financial institutions. The Company is exposed to
credit risk in the event of non-performance by the counter-party to the Forward
Contracts and the CC Swap. The Company believes it mitigates its credit risk by
entering into the Forward Contracts and the CC Swap with major financial
institutions.
The Company has not, and does not plan to, enter into any derivative financial
instruments for trading or speculative purposes. As of December 31, 2003, the
Company had no other material exposure to market risk.
Item 8. Financial Statements and Supplementary Data
The response to this Item 8 is included as a separate section of this annual
report on Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
Item 9A. Controls and Procedures
The Company's management, with the participation of the Company's chief
executive officer and chief financial officer, has evaluated the effectiveness
of the Company's disclosure controls and procedures (as such term is defined in
Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) as of the end of the period covered by this
report. Based on such evaluation, the Company's chief executive officer and
chief financial officer have concluded that, as of the end of such period, the
Company's disclosure controls and procedures are effective in recording,
processing, summarizing and reporting, on a timely basis, information required
to be disclosed by the Company in the reports that it files or submits under the
Exchange Act.
There have not been any changes in the Company's internal control over financial
reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the
Exchange Act) during the fiscal year to which this report relates that have
materially affected, or are reasonable likely to materially affect, the
Company's internal control over financial reporting.
46
PART III
Item 10. Directors and Executive Officers of the Registrant
Incorporated herein by reference to the Company's definitive proxy statement to
be filed with respect to its Annual Meeting of Stockholders expected to be held
on May 20, 2004.
Information with respect to the Executive Officers of the Registrant follows
Part I, Item 4 of this annual report on Form 10-K.
Item 11. Executive Compensation
Incorporated herein by reference to the Company's definitive proxy statement to
be filed with respect to its Annual Meeting of Stockholders expected to be held
on May 20, 2004.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Incorporated herein by reference to the Company's definitive proxy statement to
be filed with respect to its Annual Meeting of Stockholders expected to be held
on May 20, 2004.
Item 13. Certain Relationships and Related Transactions
Incorporated herein by reference to the Company's definitive proxy statement to
be filed with respect to its Annual Meeting of Stockholders expected to be held
on May 20, 2004.
Item 14. Principal Accountant Fees and Services
Incorporated herein by reference to the Company's definitive proxy statement to
be filed with respect to its Annual Meeting of Stockholders expected to be held
on May 20, 2004.
47
PART IV
Item 15. Exhibits, Financial Statements, Schedules and Reports on Form 8-K
-----------------------------------------------------------------
(a) 1. Financial Statements - Form 10-K
The following consolidated financial information Report
is included as a separate section of this annual Page
report on Form 10-K.
Report of Independent Auditors 54
Consolidated Financial Statements
Consolidated Balance Sheets as of December 31, 2003
and 2002 55
Consolidated Statements of Income for the years
ended December 31, 2003, 2002 and 2001 56
Consolidated Statements of Comprehensive Income
for the years ended December 31, 2003, 2002 and 2001 57
Consolidated Statements of Stockholders' Equity
for the years ended December 31, 2003, 2002
and 2001 58
Consolidated Statements of Cash Flows for the years
ended December 31, 2003, 2002 and 2001 59
Notes to Consolidated Financial Statements 60
2. Financial Statement Schedules -
Schedule II - Valuation and Qualifying Accounts 90
Schedule III - Real Estate and Accumulated Depreciation 91
All other schedules are omitted since the required
information is not present or is not present in amounts
sufficient to require submission of the schedule.
3. Exhibits
The exhibits listed on the accompanying Index to
Exhibits are filed as part of this report. 49
(b) Reports on Form 8-K
A Current Report on Form 8-K dated October 1, 2003 was furnished under
Item 9 to announce the Company's completion of its acquisition of
Mid-Atlantic Realty Trust.
A Current Report on Form 8-K dated October 23, 2003 was furnished under
Item 12 and Item 9 relating to the announcement of the Company's third
quarter 2003 operating results.
A Current Report on Form 8-K dated November 10, 2003 was furnished
under Item 12 and Item 9 to announce the Company's updated financial
results for the three and nine months ended September 30, 2003
reflecting the FASB's deferral of certain provisions of SFAS No. 150.
48
INDEX TO EXHIBITS
Form 10-K
Exhibits Page
- -------- ----
2.1 -- Form of Plan of Reorganization of Kimco Realty Corporation
[Incorporated by reference to Exhibit 2.1 to the Company's
Registration Statement on Form S-11 No. 33-42588].
3.1 -- Articles of Amendment and Restatement of the Company, dated
August 4, 1994 [Incorporated by reference to Exhibit 3.1 to
the Company's Annual Report on Form 10-K for the year ended
December 31, 1994].
3.2 -- By-laws of the Company dated February 6, 2002, as amended.
[Incorporated by reference to Exhibit 3.2 to the 2001
Form 10-K]
3.3 -- Articles Supplementary relating to the 8 1/2% Class B
Cumulative Redeemable Preferred Stock, par value $1.00 per
share, of the Company, dated July 25, 1995. [Incorporated by
reference to Exhibit 3.3 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1995 (file #1-10899)
(the "1995 Form 10-K")].
3.4 -- Articles Supplementary relating to the 8 3/8% Class C
Cumulative Redeemable Preferred Stock, par value $1.00 per
share, of the Company, dated April 9, 1996 [Incorporated by
reference to Exhibit 3.4 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1996].
3.5 -- Articles Supplementary relating to the 7 1/2% Class D
Cumulative Convertible Preferred Stock, par value $1.00 per
share, of the Company, dated May 14, 1998 [Incorporated by
reference to the Company's and The Price REIT, Inc.'s Joint
Proxy/Prospectus on Form S-4 No. 333-52667].
3.6 -- Articles Supplementary relating to the 6.65% Class F
Cumulative Redeemable Preferred Stock, par value $1.00 per
share, of the Company, dated May 7, 2003 [Incorporated by
reference to the Company's filing on Form 8-A dated June 3,
2003].
4.1 -- Agreement of the Company pursuant to Item 601(b)(4)(iii)(A)
of Regulation S-K [Incorporated by reference to Exhibit 4.1 to
Amendment No. 3 to the Company's Registration Statement on
Form S-11 No. 33-42588].
4.2 -- Certificate of Designations [Incorporated by reference to
Exhibit 4(d) to Amendment No. 1 to the Registration Statement
on Form S-3 dated September 10, 1993 (the "Registration
Statement", Commission File No. 33-67552)].
4.3 -- Indenture dated September 1, 1993 between Kimco Realty
Corporation and Bank of New York (as successor to IBJ Schroder
Bank and Trust Company) [Incorporated by reference to Exhibit
4(a) to the Registration Statement].
4.4 -- First Supplemental Indenture, dated as of August 4, 1994.
[Incorporated by reference to Exhibit 4.6 to the 1995
Form 10-K.]
4.5 -- Second Supplemental Indenture, dated as of April 7, 1995
[Incorporated by reference to Exhibit 4(a) to the Company's
Current Report on Form 8-K dated April 7, 1995 (the "April
1995 8-K")].
49
INDEX TO EXHIBITS (continued)
Form 10-K
Exhibits Page
- -------- ----
4.6 -- Form of Medium-Term Note (Fixed Rate).
[Incorporated by reference to Exhibit 4.6 to the 2001
Form 10-K]
4.7 -- Form of Medium-Term Note (Floating Rate).
[Incorporated by reference to Exhibit 4.7 to the 2001
Form 10-K]
4.8 -- Form of Remarketed Reset Note [Incorporated by reference
to Exhibit 4(j) to the Company's Current Report on Form 8-K
dated March 26, 1999].
10.1 -- Form of Acquisition Option Agreement between the Company
and the subsidiary named therein [Incorporated by reference to
Exhibit 10.1 to Amendment No. 3 to the Company's Registration
Statement on Form S-11 No. 33-42588].
10.2 -- Management Agreement between the Company and KC Holdings, Inc.
[Incorporated by reference to Exhibit 10.2 to the Company's
Registration Statement on Form S-11 No. 33-47915].
10.3 -- Amended and Restated Stock Option Plan [Incorporated by
reference to Exhibit 10.3 to the 1995 Form 10-K].
10.4 -- Employment Agreement between Kimco Realty Corporation and
Michael J. Flynn, dated November 1, 1988 [Incorporated by
reference to Exhibit 10.4 to the 1998 Form 10-K].
10.5 -- Restricted Equity Agreement, Non-Qualified and Incentive
Stock Option Agreement, and Price Condition Non-Qualified and
Incentive Stock Option Agreement between Kimco Realty
Corporation and Michael J. Flynn, each dated November 1, 1995
[Incorporated by reference to Exhibit 10.5 to the 1995 Form
10-K].
10.6 -- Employment Agreement between Kimco Realty Corporation and
Michael V. Pappagallo, dated January 1, 2002 [Incorporated By
reference to Exhibit 10.6 to the 2001 Form 10-K].
10.7 -- Employment Agreement between Kimco Realty Corporation and
Jerald Friedman, dated January 13, 1998 [Incorporated by
Reference to Exhibit 10.10 to the Company's and the Price
REIT, Inc.'s Joint Proxy Statement/Prospectus on Form S-4 No.
333-52667].
10.8 -- First Amendment to Amended and Restated Executive Employment
Agreement between Kimco Realty Corporation and Jerald
Friedman, dated January 1, 2002. [Incorporated by reference to
Exhibit 10.8 to the 2001 Form 10-K]
10.9 -- Amended and Restated Stock Option Plan [Incorporated by
reference to the Company's and The Price REIT, Inc.'s Joint
Proxy/Prospectus on Form S-4 No. 333-52667].
10.10 -- Employment Agreement between Kimco Realty Corporation and
David B. Henry - the Company commenced a five-year employment
agreement with Mr. Henry pursuant to which Mr. Henry will
serve as Chief Investment Officer and has been nominated as
Vice Chairman of the Board of Directors [Incorporated by
reference to Exhibit 10.11 to the Company's Form 10-Q filed on
May 10, 2001].
10.11 -- Employment Agreement between Kimco Realty Corporation
and Raymond Edwards - the Company commenced a five-year
employment agreement with Mr. Edwards pursuant to which Mr.
Edwards will serve as a Vice President of the Company
[Incorporated by reference to Exhibit 10.11 to the 2002 Form
10-K].
50
INDEX TO EXHIBITS (continued)
Form 10-K
Exhibits Page
- -------- ----
10.12 -- $500,000,000 Credit Agreement dated as of June 3, 2003 among
Kimco Realty Corporation, the Several Lenders from Time to
Time Parties Hereto, JPMorgan Chase Bank as Issuing Lender,
Bank One, NA, Wachovia Bank, National Association as
Syndication Agents, UBS AG, Cayman Island Branch, The Bank of
Nova Scotia, New York Agency as Documentation Agents, The Bank
of New York, Eurohypo AG, New York Branch, Keybank National
Association, Merrill Lynch Bank, USA, Suntrust as Co-Agents
and JPMorgan Chase As Administrative Agent [Incorporated by
reference to Exhibit 10.11 to the Company's Form 10-Q filed on
August 11, 2003].
10.13 -- $400,000,000 Credit Agreement dated as of October 1, 2003
among Kimco Realty Corporation, the Several Lenders from Time
to Time Parties Hereto, Wachovia Bank, National Association
and the Bank of Nova Scotia, as Syndication Agents, Keybank
National Association as Documentation Agent, Bank One, NA as
Administrative Agent, Banc One Capital Markets, Inc. and
Scotia Capital as Co-Bookrunners And Co-Lead Arrangers
[Incorporated by reference to Exhibit 10.12 to the Company's
Form 10-Q filed on November 10, 2003].
*12.1 -- Computation of Ratio of Earnings to Fixed Charges. 99
*12.2 -- Computation of Ratio of Earnings to Combined Fixed Charges
and Preferred Stock Dividends. 100
*21.1 -- Subsidiaries of the Company 101
*23.1 -- Consent of PricewaterhouseCoopers LLP 109
*31.1 -- Certification of the Company's Chief Executive Officer,
Milton Cooper, pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002. 110
*31.2 -- Certification of the Company's Chief Financial Officer,
Michael V. Pappagallo, pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002. 111
*32.1 -- Certification of the Company's Chief Executive Officer Milton
Cooper, and the Company's Chief Financial Officer Michael V.
Pappagallo, pursuant to section 906 of the Sarbanes-Oxley Act
of 2002. 112
- ---------------------------------------
* Filed herewith.
51
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
KIMCO REALTY CORPORATION
(Registrant)
By: /s/ Milton Cooper
------------------------
Milton Cooper
Chief Executive Officer
Dated: March 9, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Signature Title Date
--------- ------ ----
/s/ Martin S. Kimmel Chairman (Emeritus) of March 9, 2004
--------------------------- the Board of Directors
Martin S. Kimmel
/s/ Milton Cooper Chairman of the Board March 9, 2004
--------------------------- of Directors and Chief
Milton Cooper Executive Officer
/s/ Michael J. Flynn Vice Chairman of the March 9, 2004
--------------------------- Board of Directors,
Michael J. Flynn President and
Chief Operating Officer
/s/ David B. Henry Vice Chairman of the March 9, 2004
--------------------------- Board of Directors and
David B. Henry Chief Investment Officer
/s/ Richard G. Dooley Director March 9, 2004
---------------------------
Richard G. Dooley
/s/ Joe Grills Director March 9, 2004
---------------------------
Joe Grills
/s/ F. Patrick Hughes Director March 9, 2004
---------------------------
F. Patrick Hughes
/s/ Frank Lourenso Director March 9, 2004
---------------------------
Frank Lourenso
/s/ Richard Saltzman Director March 9, 2004
---------------------------
Richard Saltzman
/s/ Michael V. Pappagallo Vice President - March 9, 2004
--------------------------- Chief Financial Officer
Michael V. Pappagallo
/s/ Glenn G. Cohen Vice President - March 9, 2004
--------------------------- Treasurer
Glenn G. Cohen
/s/ Paul Westbrook Director of Accounting March 9, 2004
---------------------------
Paul Westbrook
52
ANNUAL REPORT ON FORM 10-K
ITEM 8, ITEM 15 (a) (1) and (2)
INDEX TO FINANCIAL STATEMENTS
AND
FINANCIAL STATEMENT SCHEDULES
-------
FORM 10-K
Page No.
--------
KIMCO REALTY CORPORATION AND SUBSIDIARIES
Report of Independent Auditors 54
Consolidated Financial Statements and Financial Statement Schedules:
Consolidated Balance Sheets as of December 31, 2003 and 2002 55
Consolidated Statements of Income for the years ended
December 31, 2003, 2002 and 2001 56
Consolidated Statements of Comprehensive Income for the
years ended December 31, 2003, 2002 and 2001 57
Consolidated Statements of Stockholders' Equity
for the years ended December 31, 2003, 2002 and 2001 58
Consolidated Statements of Cash Flows for the years ended
December 31, 2003, 2002 and 2001 59
Notes to Consolidated Financial Statements 60
Financial Statement Schedules:
II. Valuation and Qualifying Accounts 90
III. Real Estate and Accumulated Depreciation 91
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors and Stockholders
of Kimco Realty Corporation:
In our opinion, the consolidated financial statements listed in the index
appearing under Item 15 (a)(1) present fairly, in all material respects, the
financial position of Kimco Realty Corporation and Subsidiaries (collectively,
the "Company") at December 31, 2003 and 2002, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2003 in conformity with accounting principles generally accepted
in the United States of America. In addition, in our opinion, the financial
statement schedules listed in the index appearing under Item 15 (a)(2) present
fairly, in all material respects, the information set forth therein when read in
conjunction with the related consolidated financial statements. These financial
statements and financial statement schedules are the responsibility of the
Company's management; our responsibility is to express an opinion on these
financial statements and financial statement schedules based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States of America, which require that we plan
and perform the audit to obtain reasonable assurance about 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, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
As discussed in Note 7 to the consolidated financial statements, effective
January 1, 2002 the Company adopted the provisions of Statement of Financial
Accounting Standards No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets," which requires that the results of operations, including any
gain or loss on sale, relating to real estate that has been disposed of or is
classified as held for sale after initial adoption be reported in discontinued
operations for all periods presented.
/s/ PricewaterhouseCoopers LLP
New York, New York
March 2, 2004
54
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share information)
December 31, December 31,
2003 2002
-------------- -------------
Assets:
Real Estate
Rental property
Land $ 664,069 $ 518,268
Building and improvements 3,166,857 2,666,626
----------- -----------
3,830,926 3,184,894
Less, accumulated depreciation and amortization 568,015 516,558
----------- -----------
3,262,911 2,668,336
Real estate under development 304,286 234,953
Undeveloped land parcels 1,312 1,312
----------- -----------
Real estate, net 3,568,509 2,904,601
Investment and advances in real estate joint ventures 487,394 390,484
Other real estate investments 113,085 99,542
Mortgages and other financing receivables 95,019 94,024
Cash and cash equivalents 48,288 35,962
Marketable securities 45,677 66,992
Accounts and notes receivable 57,080 56,484
Deferred charges and prepaid expenses 66,095 50,149
Other assets 122,778 60,112
----------- -----------
$ 4,603,925 $ 3,758,350
=========== ===========
Liabilities & Stockholders' Equity:
Notes payable $ 1,686,250 $ 1,302,250
Mortgages payable 375,914 230,760
Construction loans payable 92,784 43,972
Accounts payable and accrued expenses 92,239 94,784
Dividends payable 65,969 59,646
Other liabilities 55,006 24,198
----------- -----------
2,368,162 1,755,610
----------- -----------
Minority interests in partnerships 99,917 93,940
----------- -----------
Commitments and contingencies
Stockholders' Equity
Preferred stock, $1.00 par value, authorized 3,600,000 shares
Class A Preferred Stock, $1.00 par value, authorized 345,000 shares
Issued and outstanding 0 and 300,000 shares, respectively - 300
Aggregate liquidation preference $0 and $75,000, respectively
Class B Preferred Stock, $1.00 par value, authorized 230,000 shares
Issued and outstanding 0 and 200,000 shares, respectively - 200
Aggregate liquidation preference $0 and $50,000, respectively
Class C Preferred Stock, $1.00 par value, authorized 460,000 shares
Issued and outstanding 0 and 400,000 shares, respectively - 400
Aggregate liquidation preference $0 and $100,000, respectively
Class F Preferred Stock, $1.00 par value, authorized 700,000 shares
Issued and outstanding 700,000 and 0 shares, respectively 700 -
Aggregate liquidation preference $175,000 and $0, respectively
Common stock, $.01 par value, authorized 200,000,000 shares
Issued and outstanding 110,623,967 and 104,601,828 shares, respectively 1,106 1,046
Paid-in capital 2,147,286 1,984,820
Cumulative distributions in excess of net income (30,112) (85,367)
----------- -----------
2,118,980 1,901,399
Accumulated other comprehensive income 16,866 7,401
----------- -----------
2,135,846 1,908,800
----------- -----------
$ 4,603,925 $ 3,758,350
=========== ===========
The accompanying notes are an integral part of these consolidated financial
statements.
55
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share information)
Year Ended December 31,
-----------------------------------------
2003 2002 2001
--------- --------- ---------
Real estate operations:
- -----------------------
Revenues from rental property $ 479,664 $ 432,777 $ 431,498
--------- --------- ---------
Rental property expenses:
Rent 11,240 11,300 11,569
Real estate taxes 61,276 60,248 53,892
Operating and maintenance 53,979 44,525 42,784
--------- --------- ---------
126,495 116,073 108,245
--------- --------- ---------
353,169 316,704 323,253
Income from other real estate investments 22,828 16,038 38,113
Mortgage financing income 18,587 19,412 2,594
Management and other fee income 15,315 12,069 6,350
Depreciation and amortization (86,237) (70,894) (68,509)
--------- --------- ---------
323,662 293,329 301,801
--------- --------- ---------
Interest, dividends and other investment income 19,464 18,565 16,999
Other income/(expense), net (3,792) 2,532 (2,176)
--------- --------- ---------
15,672 21,097 14,823
--------- --------- ---------
Interest expense (102,709) (85,323) (87,005)
General and administrative expenses (38,657) (31,605) (28,336)
Gain on early extinguishment of debt 2,921 19,033 -
Adjustment of property carrying values - (11,000) -
--------- --------- ---------
200,889 205,531 201,283
Provision for income taxes (1,516) (6,552) (14,009)
Equity in income of real estate joint ventures, net 42,276 37,693 21,664
Minority interests in income of partnerships, net (7,868) (2,430) (1,682)
--------- --------- ---------
Income from continuing operations 233,781 234,242 207,256
--------- --------- ---------
Discontinued operations:
Income from discontinued operating properties 10,023 7,928 18,191
Gain on early extinguishment of debt 6,760 3,222 -
Adjustment of property carrying values (4,016) (22,030) -
Gain on disposition of operating properties 47,657 12,778 -
--------- --------- ---------
Income from discontinued operations 60,424 1,898 18,191
--------- --------- ---------
Gain on sale of operating properties 3,177 - 3,040
Gain on sale of development properties
net of tax of $6,998, $6,352 and $5,367, respectively 10,497 9,528 8,051
--------- --------- ---------
Net Income 307,879 245,668 236,538
Original issuance costs associated with the redemption
of preferred stock (7,788) - -
Preferred stock dividends (14,669) (18,437) (24,553)
--------- --------- ---------
Net income available to common shareholders $ 285,422 $ 227,231 $ 211,985
========= ========= =========
Per common share:
Income from continuing operations:
-Basic $ 2.10 $ 2.16 $ 2.01
========= ========= =========
-Diluted $ 2.07 $ 2.14 $ 1.98
========= ========= =========
Net income :
-Basic $ 2.67 $ 2.18 $ 2.20
========= ========= =========
-Diluted $ 2.62 $ 2.16 $ 2.16
========= ========= =========
The accompanying notes are an integral part of these consolidated financial
statements.
56
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Years Ended December 31, 2003, 2002 and 2001
(in thousands)
2003 2002 2001
--------- --------- ---------
Net income $ 307,879 $ 245,668 $ 236,538
--------- --------- ---------
Other comprehensive income:
Change in unrealized gain/(loss) on marketable securities 3,798 (4,456) 8,784
Change in unrealized gain on interest rate swaps 620 3,264 (3,884)
Change in unrealized gain on warrants 4,319 1,524 2,410
Change in unrealized gain/(loss) on foreign currency hedge agreements (15,465) 195 -
Foreign currency translation adjustment 16,193 (436) -
--------- --------- ---------
Other comprehensive income 9,465 91 7,310
--------- --------- ---------
Comprehensive income $ 317,344 $ 245,759 $ 243,848
========= ========= =========
The accompanying notes are an integral part of these consolidated financial
statements.
57
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
For the Years Ended December 31, 2003, 2002, and 2001
(in thousands, except per share information)
Cumulative
Preferred Stock Common Stock Distributions
----------------- ----------------- Paid in in Excess
Issued Amount Issued Amount Capital of Net Income
---------------------------------------------------------------------
Balance, January 1, 2001 1,318 $ 1,318 94,717 $ 947 $ 1,819,130 $(113,110)
Net income 236,538
Dividends ($1.96 per common share; $1.9375, $2.125,
$2.0938, and $1.8409 per Class A, Class B, Class
C, and Class D Depositary Share, respectively) (216,559)
Issuance of common stock 3,906 40 122,103
Exercise of common stock options 1,694 17 34,919
Conversion of Class D Preferred Stock to common stock (326) (326) 3,036 30 290
Other comprehensive income
----- ------- ------- ------- ------------ -----------
Balance, December 31, 2001 992 992 103,353 1,034 1,976,442 (93,131)
Net income 245,668
Dividends ($2.10 per common share; $1.9375, $2.125 and
$2.0938 per Class A, Class B, and Class C Depositary
Share, respectively) (237,904)
Issuance of common stock 80 1 2,523
Exercise of common stock options 308 3 5,771
Collection of notes receivable
Conversion of Class D Preferred Stock to common stock (92) (92) 861 8 84
Other comprehensive income
----- ------- ------- ------- ------------ -----------
Balance, December 31, 2002 900 900 104,602 1,046 1,984,820 (85,367)
Net income 307,879
Dividends ($2.19 per common share; $1.0979, $1.3399,
$1.3610, and $1.016 per Class A, Class B, Class C and
Class F Depositary Share, respectively) (252,624)
Issuance of common stock 4,944 49 192,703
Exercise of common stock options 1,078 11 25,777
Redemption of Class A, B and C preferred stock (900) (900) (224,100)
Issuance of Class F Preferred Stock 700 700 168,086
Other comprehensive income
----- ------- ------- ------- ------------ -----------
Balance, December 31, 2003 700 $ 700 110,624 $ 1,106 $ 2,147,286 $ (30,112)
===== ======= ======= ======= ============ ===========
Accumulated Total
Other Comprehensive Stockholders'
Income Equity
----------------------------------------
Balance, January 1, 2001 $ - $ 1,708,285
Net income 236,538
Dividends ($1.96 per common share; $1.9375, $2.125,
$2.0938, and $1.8409 per Class A, Class B, Class
C, and Class D Depositary Share, respectively) (216,559)
Issuance of common stock 122,143
Exercise of common stock options 34,936
Conversion of Class D Preferred Stock to common stock (6)
Other comprehensive income 7,310 7,310
-------- -----------
Balance, December 31, 2001 7,310 1,892,647
Net income 245,668
Dividends ($2.10 per common share; $1.9375, $2.125 and
$2.0938 per Class A, Class B, and Class C Depositary
Share, respectively) (237,904)
Issuance of common stock 2,524
Exercise of common stock options 5,774
Collection of notes receivable
Conversion of Class D Preferred Stock to common stock -
Other comprehensive income 91 91
-------- -----------
Balance, December 31, 2002 7,401 1,908,800
Net income 307,879
Dividends ($2.19 per common share; $1.0979, $1.3399,
$1.3610, and $1.016 per Class A, Class B, Class C and
Class F Depositary Share, respectively) (252,624)
Issuance of common stock 192,752
Exercise of common stock options 25,788
Redemption of Class A, B and C preferred stock (225,000)
Issuance of Class F Preferred Stock 168,786
Other comprehensive income 9,465 9,465
-------- -----------
Balance, December 31, 2003 $ 16,866 $ 2,135,846
======== ===========
The accompanying notes are an integral part of these consolidated financial
statements.
58
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Year Ended December 31,
-----------------------------------------
2003 2002 2001
--------- --------- ---------
Cash flow from operating activities:
Net income $ 307,879 $ 245,668 $ 236,538
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 89,068 76,674 74,209
Adjustment of property carrying values 4,016 33,031 -
Gain on sale of development properties (17,495) (15,879) (13,418)
Gain on sale of operating properties (50,834) (12,778) (3,040)
Gain on early extinguishment of debt (9,681) (22,255) -
Minority interests in income of partnerships, net 7,868 2,430 1,682
Equity in income of real estate joint ventures, net (42,276) (37,693) (21,664)
Income from other real estate investments (19,976) (13,222) (33,518)
Distributions from unconsolidated investments 67,712 40,275 36,377
Change in accounts and notes receivable (596) (6,938) (1,956)
Change in accounts payable and accrued expenses (2,545) 12,612 3,607
Change in other operating assets and liabilities (24,508) (22,994) 8,627
--------- --------- ---------
Net cash flow provided by operating activities 308,632 278,931 287,444
--------- --------- ---------
Cash flow from investing activities:
Acquisition of and improvements to operating real estate (917,403) (244,750) (63,809)
Acquisition of and improvements to real estate under development (187,877) (113,450) (107,364)
Investment in marketable securities (23,680) (39,183) (29,070)
Proceeds from sale of marketable securities 62,744 49,396 36,427
Investments and advances to real estate joint ventures (152,997) (157,427) (63,302)
Reimbursements of advances to real estate joint ventures 93,729 16,665 -
Redemption of minority interests in real estate partnerships (4,729) - (7,133)
Other real estate investments (52,818) (69,288) (24,824)
Reimbursements of advances to other real estate investments 13,264 1,179 24,824
Investment in mortgage loans receivable (64,652) (123,242) (36,099)
Collection of mortgage loans receivable 41,529 89,053 5,952
Proceeds from sale of mortgage loan receivable 36,723 - -
Proceeds from sale of operating properties 423,237 84,139 46,766
Proceeds from sale of development properties 90,565 108,209 61,921
Other - 2,044 (1,482)
--------- --------- ---------
Net cash flow used for investing activities (642,365) (396,655) (157,193)
--------- --------- ---------
Cash flow from financing activities:
Principal payments on debt, excluding
normal amortization of rental property debt (18,326) (30,689) (4,587)
Principal payments on rental property debt (5,813) (5,931) (5,126)
Principal payments on construction loan financings (40,644) (801) -
Proceeds from mortgage/construction loan financings 110,816 67,773 51,230
Borrowings under revolving credit facilities 195,000 269,000 10,000
Repayment of borrowings under revolving credit facilities (190,000) (229,000) (55,000)
Proceeds from issuance of unsecured senior notes 250,000 337,000 -
Repayment of unsecured senior notes (200,000) (110,000) -
Proceeds from senior term loan 400,000 - -
Repayment of senior term loan (71,000) - -
Payment of unsecured obligation - (11,300) -
Dividends paid (246,301) (235,602) (209,785)
Proceeds from issuance of stock 387,327 9,389 157,767
Redemption of preferred stock (225,000) - -
--------- --------- ---------
Net cash flow provided by (used for) financing activities 346,059 59,839 (55,501)
--------- --------- ---------
Change in cash and cash equivalents 12,326 (57,885) 74,750
Cash and cash equivalents, beginning of year 35,962 93,847 19,097
--------- --------- ---------
Cash and cash equivalents, end of year $ 48,288 $ 35,962 $ 93,847
========= ========= =========
Interest paid during the year (net of capitalized interest
of $8,887, $9,089 and $7,924, respectively) $ 97,215 $ 83,977 $ 81,092
========= ========= =========
Income taxes paid during the year $ 15,901 $ 12,035 $ 24,888
========= ========= =========
The accompanying notes are an integral part of these consolidated financial
statements.
59
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies:
Business
Kimco Realty Corporation (the "Company" or "Kimco"), its subsidiaries,
affiliates and related real estate joint ventures are engaged
principally in the operation of neighborhood and community shopping
centers which are anchored generally by discount department stores,
supermarkets or drugstores. The Company also provides property
management services for shopping centers owned by affiliated
entities, various real estate joint ventures and unaffiliated third
parties.
Additionally, in connection with the Tax Relief Extension Act of 1999
(the "RMA"), which became effective January 1, 2001, the Company is
now permitted to participate in activities which it was precluded
from previously in order to maintain its qualification as a Real
Estate Investment Trust ("REIT"), so long as these activities are
conducted in entities which elect to be treated as taxable
subsidiaries under the Internal Revenue Code, subject to certain
limitations. As such, the Company, through its taxable REIT
subsidiaries, is engaged in various retail real estate related
opportunities including (i) merchant building, through its Kimco
Developers, Inc. ("KDI") subsidiary, which is primarily engaged in
the ground-up development of neighborhood and community shopping
centers and the subsequent sale thereof upon completion, (ii)
retail real estate advisory and disposition services which
primarily focuses on leasing and disposition strategies of retail
real estate controlled by both healthy and distressed and/or
bankrupt retailers, and (iii) acting as an agent or principal in
connection with tax deferred exchange transactions.
The Company seeks to reduce its operating and leasing risks through
diversification achieved by the geographic distribution of its
properties, avoiding dependence on any single property, and a large
tenant base. At December 31, 2003, the Company's single largest
neighborhood and community shopping center accounted for only 1.0%
of the Company's annualized base rental revenues and only 0.6% of
the Company's total shopping center gross leasable area ("GLA"). At
December 31, 2003, the Company's five largest tenants were The Home
Depot, Kmart Corporation, Kohl's, Royal Ahold and TJX Companies,
which represented approximately 3.0%, 2.9%, 2.8%, 2.6% and 2.5%,
respectively, of the Company's annualized base rental revenues,
including the proportionate share of base rental revenues from
properties in which the Company has less than a 100% economic
interest.
The principal business of the Company and its consolidated subsidiaries
is the ownership, development, management and operation of retail
shopping centers, including complementary services that capitalize
on the Company's established retail real estate expertise. The
Company does not distinguish or group its operations on a
geographical basis for purposes of measuring performance.
Accordingly, the Company believes it has a single reportable
segment for disclosure purposes in accordance with accounting
principles generally accepted in the United States of America.
Principles of Consolidation and Estimates
The accompanying Consolidated Financial Statements include the accounts
of the Company, its subsidiaries, all of which are wholly-owned,
and all partnerships in which the Company has a controlling
interest. All intercompany balances and transactions have been
eliminated in consolidation.
Accounting principles generally accepted in the United States of
America ("GAAP") require the Company's management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities
and the reported amounts of revenues and expenses during a
reporting period. The most significant assumptions and estimates
relate to the valuation of real estate, depreciable lives, revenue
recognition and the collectability of trade accounts receivable.
Application of these assumptions requires the exercise of judgment
as to future uncertainties and, as a result, actual results could
differ from these estimates.
60
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Real Estate
Real estate assets are stated at cost, less accumulated depreciation
and amortization. If there is an event or a change in circumstances
that indicates that the basis of a property (including any related
amortizable intangible assets or liabilities) may not be
recoverable, then management will assess any impairment in value by
making a comparison of (i) the current and projected operating cash
flows (undiscounted and without interest charges) of the property
over its remaining useful life and (ii) the net carrying amount of
the property. If the current and projected operating cash flows
(undiscounted and without interest charges) are less than the
carrying value of the property, the carrying value would be
adjusted to an amount to reflect the estimated fair value of the
property.
When a real estate asset is identified by management as held for sale,
the Company ceases depreciation of the asset and estimates the
sales price, net of selling costs. If, in management's opinion, the
net sales price of the asset is less than the net book value of the
asset, an adjustment to the carrying value would be recorded to
reflect the estimated fair value of the property.
Upon acquisition of real estate operating properties, the Company
estimates the fair value of acquired tangible assets (consisting of
land, building and improvements) and identified intangible assets
and liabilities (consisting of above and below-market leases,
in-place leases and tenant relationships) and assumed debt in
accordance with Statement of Financial Accounting Standards
("SFAS") No. 141, Business Combinations ("SFAS No. 141"). Based on
these estimates, the Company allocates the purchase price to the
applicable assets and liabilities.
The Company utilized methods similar to those used by independent
appraisers in estimating the fair value of acquired assets and
liabilities. The fair value of the tangible assets of an acquired
property considers the value of the property "as-if-vacant". The
fair value reflects the depreciated replacement cost of the
permanent assets, with no trade fixtures included.
In allocating the purchase price to identified intangible assets and
liabilities of an acquired property, the value of above-market and
below-market leases are estimated based on the present value of the
difference between the contractual amounts to be paid pursuant to
the leases and management's estimate of the market lease rates and
other lease provisions (i.e. expense recapture, base rental
changes, etc.) measured over a period equal to the estimated
remaining term of the lease. The capitalized above-market or
below-market intangible is amortized to rental income over the
estimated remaining term of the respective leases.
In determining the value of in-place leases, management considers
current market conditions and costs to execute similar leases in
arriving at an estimate of the carrying costs during the expected
lease-up period from vacant to existing occupancy. In estimating
carrying costs, management includes real estate taxes, insurance,
other operating expenses and estimates of lost rental revenue
during the expected lease-up periods and costs to execute similar
leases including leasing commissions, legal and other related costs
based on current market demand. In estimating the value of tenant
relationships, management considers the nature and extent of the
existing tenant relationship, the expectation of lease renewals,
growth prospects, and tenant credit quality, among other factors.
The value assigned to in-place leases and tenant relationships are
amortized over the estimated remaining term of the leases. If a
lease were to be terminated prior to its scheduled expiration, all
unamortized costs relating to that lease would be written off.
Depreciation and amortization are provided on the straight-line method
over the estimated useful lives of the assets, as follows:
Buildings 15 to 46 years
Fixtures, building and leasehold improvements Terms of leases or useful
(including certain identified intangible assets) lives, whichever is shorter
Expenditures for maintenance and repairs are charged to operations as
incurred. Significant renovations and replacements, which improve
and extend the life of the asset, are capitalized. The useful lives
of amortizable intangible assets are evaluated each reporting
period with any changes in estimated useful lives being accounted
for over the revised remaining useful life.
61
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Real Estate Under Development
Real estate under development represents the ground-up development of
neighborhood and community shopping centers which are held for sale
upon completion. These properties are carried at cost and no
depreciation is recorded on these assets. The cost of land and
buildings under development include specifically identifiable
costs. The capitalized costs include pre-construction costs
essential to the development of the property, development costs,
construction costs, interest costs, real estate taxes, salaries and
related costs and other costs incurred during the period of
development. The Company ceases cost capitalization when the
property is held available for occupancy upon substantial
completion of tenant improvements, but no later than one year from
the completion of major construction activity. If in management's
opinion, the net sales price of these assets is less than the net
carrying value, the carrying value would be written down to an
amount to reflect the estimated fair value of the property.
Investments in Unconsolidated Joint Ventures
The Company accounts for its investments in unconsolidated joint
ventures under the equity method of accounting as the Company
exercises significant influence, but does not control these
entities. These investments are recorded initially at cost and
subsequently adjusted for equity in earnings and cash contributions
and distributions.
On a periodic basis, management assesses whether there are any
indicators that the value of the Company's investments in
unconsolidated joint ventures may be impaired. An investment's
value is impaired only if management's estimate of the fair value
of the investment is less than the carrying value of the
investment. To the extent impairment has occurred, the loss shall
be measured as the excess of the carrying amount of the investment
over the estimated fair value of the investment.
Marketable Securities
The Company classifies its existing marketable equity securities as
available-for-sale in accordance with the provisions of SFAS No.
115, Accounting for Certain Investments in Debt and Equity
Securities. These securities are carried at fair market value, with
unrealized gains and losses reported in stockholders' equity as a
component of Accumulated other comprehensive income ("OCI"). Gains
or losses on securities sold are based on the specific
identification method.
All debt securities are classified as held-to-maturity because the
Company has the positive intent and ability to hold the securities
to maturity. Held-to-maturity securities are stated at amortized
cost, adjusted for amortization of premiums and accretion discounts
to maturity.
Deferred Leasing and Financing Costs
Costs incurred in obtaining tenant leases and long-term financing,
included in deferred charges and prepaid expenses in the
accompanying Consolidated Balance Sheets, are amortized over the
terms of the related leases or debt agreements, as applicable.
Revenue Recognition and Accounts Receivable
Base rental revenues from rental property are recognized on a
straight-line basis over the terms of the related leases. Certain
of these leases also provide for percentage rents based upon the
level of sales achieved by the lessee. These percentage rents are
recorded once the required sales level is achieved. Rental income
may also include payments received in connection with lease
termination agreements. In addition, leases typically provide for
reimbursement to the Company of common area maintenance costs, real
estate taxes and other operating expenses. Operating expense
reimbursements are recognized as earned.
The Company makes estimates of the uncollectability of its accounts
receivable related to base rents, expense reimbursements and other
revenues. The Company analyzes accounts receivable and historical
bad debt levels, customer credit worthiness and current economic
trends and evaluating the adequacy of the allowance for doubtful
accounts. In addition, tenants in bankruptcy are analyzed and
estimates are made in connection with the expected recovery of
pre-petition and post-petition claims. The Company's reported net
income is directly affected by management's estimate of the
collectability of accounts receivable.
62
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Income Taxes
The Company and its subsidiaries file a consolidated federal income tax
return. The Company has made an election to qualify, and believes
it is operating so as to qualify, as a REIT for federal income tax
purposes. Accordingly, the Company generally will not be subject to
federal income tax, provided that distributions to its stockholders
equal at least the amount of its REIT taxable income as defined
under Section 856 through 860 of the Internal Revenue Code, as
amended (the "Code").
In connection with the RMA, which became effective January 1, 2001,
the Company is now permitted to participate in certain activities
which it was previously precluded from in order to maintain its
qualification as a REIT, so long as these activities are conducted
in entities which elect to be treated as taxable subsidiaries under
the Code. As such, the Company is subject to federal and state
income taxes on the income from these activities.
Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for the
estimated future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases and operating loss
and tax credit carry-forwards. Deferred tax assets and liabilities
are measured using enacted tax rates in effect for the year in
which those temporary differences are expected to be recovered or
settled.
Foreign Currency Translation and Transactions
Assets and liabilities of our foreign operations are translated using
year-end exchange rates, and revenues and expenses are translated
using exchange rates as determined throughout the year. Gains or
losses resulting from translation are included in OCI, as a
separate component of the Company's stockholders' equity. Gains or
losses resulting from foreign currency transactions are translated
to local currency at the rates of exchange prevailing at the dates
of the transactions. The effect of the transaction's gain or loss
is included in the caption Other income/(expense), net in the
Consolidated Statements of Income.
Derivative / Financial Instruments
Effective January 1, 2001, the Company adopted Statement of Financial
Accounting Standards No. 133, Accounting for Derivative Instruments
and Hedging Activities ("SFAS No. 133"), as amended by SFAS No. 149
in April 2003 to clarify accounting and reporting for derivative
instruments. SFAS No. 133 establishes accounting and reporting
standards for derivative instruments. This accounting standard
requires the Company to measure derivative instruments at fair
value and to record them in the Consolidated Balance Sheet as an
asset or liability, depending on the Company's rights or
obligations under the applicable derivative contract. In addition,
the fair value adjustments will be recorded in either stockholders'
equity or earnings in the current period based on the designation
of the derivative. The effective portions of changes in fair value
of cash flow hedges are reported in OCI and are subsequently
reclassified into earnings when the hedged item affects earnings.
Changes in the fair value of foreign currency hedges that are
designated and effective as net investment hedges are included in
the cumulative translation component of OCI in accordance with SFAS
No. 52 to the extent they are economically effective and are
subsequently reclassified to earnings when the hedged investments
are sold or otherwise disposed of. The changes in fair value of
derivative instruments which are not designated as hedging
instruments and the ineffective portions of hedges are recorded in
earnings for the current period.
The Company utilizes derivative financial instruments to reduce
exposure to fluctuations in interest rates, foreign currency
exchange rates and market fluctuation on equity securities. The
Company has established policies and procedures for risk assessment
and the approval, reporting and monitoring of derivative financial
instrument activities. The Company has not, and does not plan to
enter into financial instruments for trading or speculative
purposes. Additionally, the Company has a policy of only entering
into derivative contracts with major financial institutions. The
principal financial instruments used by the Company are interest
rate swaps, foreign currency exchange forward contracts, cross
currency swaps and warrant contracts. In accordance with the
provisions of SFAS No. 133, these derivative instruments were
designated and qualified as cash flow, fair value or foreign
currency hedges (see Note 17).
63
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Earnings Per Share
On October 24, 2001, the Company's Board of Directors declared a
three-for-two split (the "Stock Split") of the Company's common
stock which was effected in the form of a stock dividend paid on
December 21, 2001 to stockholders of record on December 10, 2001.
All share and per share data included in the accompanying
Consolidated Financial Statements and Notes thereto have been
adjusted to reflect this Stock Split.
The following table sets forth the reconciliation of earnings and the
weighted average number of shares used in the calculation of basic
and diluted earnings per share (amounts presented in thousands,
except per share data):
2003 2002 2001
---- ---- ----
Computation of Basic Earnings Per Share:
Income from continuing operations $ 233,781 $ 234,242 $ 207,256
Gain on sale of operating properties 3,177 - 3,040
Gain on sale of development properties, net of provision
for income tax 10,497 9,528 8,051
Original issuance costs associated with the redemption of
preferred stock (7,788) - -
Preferred Stock Dividends (14,669) (18,437) (24,553)
--------- --------- ---------
Income from continuing operations applicable to common
shares 224,998 225,333 193,794
Income from discontinued operations 60,424 1,898 18,191
--------- --------- ---------
Net income applicable to common shares $ 285,422 $ 227,231 $ 211,985
========= ========= =========
Weighted average common shares outstanding 107,092 104,458 96,317
========= ========= =========
Basic Earnings Per Share:
Income from continuing operations $ 2.10 $ 2.16 $ 2.01
Income from discontinued operations 0.57 0.02 0.19
--------- --------- ---------
Net income $ 2.67 $ 2.18 $ 2.20
========= ========= =========
Computation of Diluted Earnings Per Share:
Income from continuing operations applicable to common
shares $ 224,998 $ 225,333 $ 193,794
Dividends on Class D Convertible Preferred Stock - - 6,115
Dividends on convertible downREIT units (a) 1,423 -
--------- --------- ---------
Income from continuing operations for diluted earnings
per share 224,998 226,756 199,909
Income from discontinued operations 60,424 1,898 18,191
--------- --------- ---------
Net income for diluted earnings per share
$ 285,422 $ 228,654 $ 218,100
========= ========= =========
64
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Weighted average common shares outstanding - Basic 107,092 104,458 96,317
Effect of dilutive securities:
Stock options 1,678 999 1,139
Assumed conversion of Class D Preferred stock to common
stock - 4 3,707
Assumed conversion of downREIT units - 508 -
--------- --------- ---------
Shares for diluted earnings per share 108,770 105,969 101,163
========= ========= =========
2003 2002 2001
--------- --------- ---------
Diluted Earnings Per Share:
Income from continuing operations $ 2.07 $ 2.14 $ 1.98
Income from discontinued operations 0.55 0.02 0.18
--------- --------- ---------
Net income $ 2.62 $ 2.16 $ 2.16
========= ========= =========
(a) In 2003, the effect of the assumed conversion of downREIT units had
an anti-dilutive effect upon the calculation of Income from
continuing operations per share. Accordingly, the impact of such
conversion has not been included in the determination of diluted
earnings per share calculations.
The Company maintains a stock option plan (the "Plan") for which prior
to January 1, 2003, the Company accounted for under the intrinsic
value-based method of accounting prescribed by Accounting
Principles Board ("APB") Opinion No. 25, Accounting for Stock
Issued to Employees, and related interpretations including FASB
Interpretation No. 44, Accounting for Certain Transactions
involving Stock Compensation (an interpretation of APB Opinion No.
25). Effective January 1, 2003, the Company adopted the prospective
method provisions of SFAS No. 148, Accounting for Stock-Based
Compensation - Transition and Disclosure an Amendment of FASB
Statement No. 123 ("SFAS No. 148"), which will apply the
recognition provisions of FASB Statement No. 123, Accounting for
Stock-Based Compensation ("SFAS No. 123") to all employee awards
granted, modified or settled after January 1, 2003. Awards under
the Company's Plan generally vest ratably over a three-year term
and expire ten years from the date of grant. Therefore, the cost
related to stock-based employee compensation included in the
determination of net income is less than that which would have been
recognized if the fair value based method had been applied to all
awards since the original effective date of SFAS No. 123. The
following table illustrates the effect on net income and earnings
per share if the fair value based method had been applied to all
outstanding stock awards in each period (amounts presented in
thousands, expect per share data):
Year Ended December 31,
-----------------------------------------------------
2003 2002 2001
--------- --------- ---------
Net income, as reported $ 307,879 $ 245,668 $ 236,538
Add: Stock based employee compensation
expense included in reported net
Income 148 - -
Deduct: Total stock based employee
Compensation expense determined
under fair value based method
for all awards (3,095) (3,153) (2,702)
--------- --------- ---------
Pro Forma Net Income - Basic $ 304,932 $ 242,515 $ 233,836
========= ========= =========
Earnings Per Share
Basic - as reported $ 2.67 $ 2.18 $ 2.20
========= ========= =========
Basic - pro forma $ 2.64 $ 2.15 $ 2.17
========= ========= =========
Net income for diluted earnings per share $ 285,422 $ 228,654 $ 218,100
Add: Stock based employee compensation
expense included in reported net
Income 148 - -
Deduct: Total stock based employee
Compensation expense determined
under fair value based method
for all awards (3,095) (3,153) (2,702)
--------- --------- ---------
Pro Forma Net Income - Diluted $ 282,475 $ 225,501 $ 215,398
========= ========= =========
Earnings Per Share
Diluted - as reported $ 2.62 $ 2.16 $ 2.16
========= ========= =========
Diluted - pro forma $ 2.60 $ 2.13 $ 2.13
========= ========= =========
65
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
These pro forma adjustments to net income and net income per diluted
common share assume fair values of each option grant estimated
using the Black-Scholes option pricing formula. The more
significant assumptions underlying the determination of such fair
values for options granted during 2003, 2002 and 2001 include: (i)
weighted average risk-free interest rates of 2.84%, 3.06% and
4.85%, respectively; (ii) weighted average expected option lives of
3.80 years, 4.1 years and 5.5 years, respectively; (iii) weighted
average expected volatility of 15.26%, 16.12% and 15.76%,
respectively, and (iv) weighted average expected dividend yield of
6.25%, 6.87% and 6.74%, respectively. The per share weighted
average fair value at the dates of grant for options awarded during
2003, 2002 and 2001 was $2.35, $1.50 and $1.98, respectively.
New Accounting Pronouncements
In January 2003, the Financial Accounting Standards Board ("FASB")
issued Interpretation No. 46, Consolidation of Variable Interest
Entities ("FIN 46"), the primary objective of which is to provide
guidance on the identification of entities for which control is
achieved through means other than voting rights ("variable interest
entities" or "VIEs") and to determine when and which business
enterprise should consolidate the VIE (the "primary beneficiary").
This new model applies when either (i) the equity investors (if
any) do not have a controlling financial interest or (ii) the
equity investment at risk is insufficient to finance that entity's
activities without additional financial support. In addition,
effective upon issuance, FIN 46 requires additional disclosures by
the primary beneficiary and other significant variable interest
holders. The provisions of FIN 46 apply immediately to VIE's
created after January 31, 2003. In October 2003, the FASB issued
FASB Staff Position 46-6, which deferred the effective date to
December 31, 2003 for applying the provisions of FIN 46 for
interests held by public companies in all VIE's created prior to
February 1, 2003. Additionally, in December 2003, the FASB issued
Interpretation No. 46(R), Consolidation of Variable Interest
Entities (revised December 2003) ("FIN 46(R)"). The provisions of
FIN 46(R) are effective as of March 31, 2004 for all non-special
purpose entity ("non-SPE") interests held by public companies in
all variable interest entities created prior to February 1, 2003.
These deferral provisions did not defer the disclosure provisions
of FIN 46(R).
The Company has evaluated its joint venture investments established
after January 31, 2003 and based upon its interpretation of FIN 46
and applied judgment, the Company has determined that these joint
venture investments are not VIEs and are not required to be
consolidated.
The Company continues to evaluate all of its investments in joint
ventures created prior to February 1, 2003 to determine whether any
of these entities are VIEs and whether the Company is considered to
be the primary beneficiary or a holder of a significant variable
interest in the VIE. If it is determined that certain of these
entities are VIEs, the Company will be required to consolidate
these entities in which the Company is the primary beneficiary or
make additional disclosures for entities in which the Company is
determined to hold a significant variable interest in the VIE as of
March 31, 2004.
The Company's joint ventures and other real estate investments
primarily consist of co-investments with institutional and other
joint venture partners in neighborhood and community shopping
center properties, consistent with its core business. These joint
ventures typically obtain non-recourse third party financing on
their property investments, thus contractually limiting the
Company's losses to the amount of its equity investment; and due to
the lender's exposure to losses, a lender typically will require a
minimum level of equity in order to mitigate their risk. The
Company's exposure to losses associated with its unconsolidated
joint ventures is limited to its carrying value in these
investments.
66
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
In April 2003, the FASB issued SFAS No. 149, Amendment of Statement
133 on Derivative Instruments and Hedging Activities ("SFAS No.
149"). This statement amends and clarifies financial accounting and
reporting for derivative instruments, including certain derivative
instruments embedded in other contracts and for hedging activities
under SFAS No. 133. The provisions of this statement are effective
for contracts entered into or modified after June 30, 2003, and for
hedging relationships designated after June 30, 2003. The adoption
of SFAS No. 149 did not have a material adverse impact on the
Company's financial position or results of operations.
In May 2003, the FASB issued SFAS No. 150, Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and
Equity ("SFAS No. 150"). This statement establishes standards for
how an issuer classifies and measures certain financial instruments
with characteristics of both liabilities and equity. It requires
that an issuer classify a financial instrument that is within its
scope as a liability (or an asset in some circumstances). The
provisions of this statement are effective for financial
instruments entered into or modified after May 31, 2003, and
otherwise are effective at the beginning of the first interim
period beginning after June 15, 2003. On November 7, 2003, the FASB
deferred the classification and measurement provisions of SFAS No.
150 as they apply to certain mandatorily redeemable non-controlling
interests. This deferral is expected to remain in effect while
these provisions are further evaluated by the FASB. As a result of
this deferral, the adoption of SFAS No. 150 did not have a material
adverse impact on the Company's financial position or results of
operations.
At December 31, 2003, the estimated fair value of minority interests
relating to mandatorily redeemable non-controlling interests
associated with finite-lived subsidiaries of the Company is
approximately $3.9 million. These finite-lived subsidiaries have
termination dates ranging from 2019 to 2027.
Reclassifications
Certain reclassifications of prior years' amounts have been made to
conform with the current year presentation.
2. Real Estate:
The Company's components of Rental property consist of the following
(in thousands):
December 31,
----------------------------
2003 2002
----------- ------------
Land $ 664,069 $ 518,268
Buildings and improvements
Buildings 2,743,112 2,527,975
Building improvements 51,042 22,849
Tenant improvements 338,205 98,367
Fixtures & leasehold improvements 14,627 17,435
Other rental property, net (1) 19,871 -
----------- ---------
3,830,926 3,184,894
Accumulated depreciation and amortization (568,015) (516,558)
------------ ----------
Total $ 3,262,911 $ 2,668,336
=========== ===========
(1) At December 31, 2003, Other rental property, net consisted of (i)
intangible assets including, $33,007 of in-place leases, $12,913
of tenant relationships and $12,892 of above-market leases and
(ii) an intangible liability consisting of $38,941 of
below-market leases.
3. Mid-Atlantic Realty Trust Merger:
During June 2003, the Company and Mid-Atlantic Realty Trust
("Mid-Atlantic") entered into a definitive merger agreement whereby
Mid-Atlantic would merge with and into a wholly-owned subsidiary of
the Company (the "Merger" or "Mid-Atlantic Merger"). The Merger
required the approval of holders of 66 2/3% of Mid-Atlantic's
outstanding shares. Subject to certain conditions, limited partners
in Mid-Atlantic's operating partnership were offered the same cash
consideration for each outstanding unit and offered the opportunity
(in lieu of cash) to exchange their interests for preferred units
in the operating partnership upon the closing of the transaction.
67
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
The shareholders of Mid-Atlantic approved the Merger on September 30,
2003, and the closing occurred October 1, 2003. Mid-Atlantic
shareholders received cash consideration of $21.051 per share. In
addition, more than 99.0% of the limited partners in Mid-Atlantic's
operating partnership elected to have their partnership units
redeemed for cash consideration equal to $21.051 per unit.
The transaction had a total value of approximately $700.0 million
including the assumption of approximately $216.0 million of debt.
The Company funded the transaction with available cash, a new
$400.0 million bridge facility and funds from its existing
revolving credit facility.
In connection with the Merger, the Company acquired interests in 41
operating shopping centers, one regional mall, two shopping centers
under development and eight other commercial assets. The properties
have a gross leasable area of approximately 5.7 million square feet
of which approximately 95.0% of the stabilized square footage is
currently leased. The Company also acquired approximately 80.0
acres of undeveloped land. The properties are located primarily in
Maryland, Virginia, New York, Pennsylvania, Massachusetts and
Delaware. The Company has tentative agreements for a number of the
properties to be allocated to its strategic co-investment programs.
For financial reporting purposes the Merger was accounted for under
the purchase method of accounting in accordance with SFAS No. 141,
Business Combinations ("SFAS No. 141").
During December 2003, the Company disposed of the one regional mall and
the adjacent annex acquired in the Merger located in Bel Air, MD
for a sales price of approximately $71.0 million, which
approximated its net book value.
4. Property Acquisitions, Developments and Other Investments:
Operating Properties -
During the years 2003, 2002 and 2001 the Company acquired operating
properties, in separate transactions, at aggregate costs of
approximately $293.9 million, $258.7 million, and $21.1 million,
respectively.
Ground-Up Development Properties -
Effective January 1, 2001, the Company elected taxable REIT subsidiary
status for its wholly-owned development subsidiary, Kimco
Developers, Inc. ("KDI"). KDI is primarily engaged in the ground-up
development of neighborhood and community shopping centers and the
subsequent sale thereof upon completion.
During the years 2003, 2002 and 2001 certain subsidiaries and
affiliates of the Company expended approximately $208.9 million,
$148.6 million, and $119.4 million, respectively, in connection
with the purchase of land and construction costs related to its
ground-up development projects.
Other Investments -
During October 2002, the Company purchased from various joint venture
partners, the remaining interest in a property located in
Harrisburg, PA for an aggregate purchase price of $0.5 million.
This property is now 100% owned by the Company.
These property acquisitions and other investments have been funded
principally through the application of proceeds from the Company's
public unsecured debt issuances, equity offerings and proceeds from
mortgage and construction financings.
5. Dispositions of Real Estate:
During 2003, the Company disposed of, in separate transactions, (i) 10
operating properties, for an aggregate sales price of approximately
$119.1 million, including the assignment of approximately $1.7
million of mortgage debt encumbering one of the properties, (ii)
two regional malls for an aggregate sales price of approximately
$135.6 million including the Bel Air, MD property referred to
above, (iii) one out-parcel for a sales price of approximately $8.1
million, (iv) transferred three operating properties to KROP, as
defined below, for a price of approximately $144.2 million which
approximated their net book value, (v) transferred an operating
property to a newly formed joint venture in which the Company has a
10% non-controlling interest for a price of approximately $21.9
million which approximated its net book value and (vi) terminated
four leasehold positions in locations where a tenant in bankruptcy
had rejected its lease. These transactions resulted in net gains of
approximately $50.8 million.
68
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2002, the Company, (i) disposed of, in separate transactions, 12
operating properties for an aggregate sales price of approximately
$74.5 million, including the assignment/repayment of approximately
$22.6 million of mortgage debt encumbering three of the properties
and (ii) terminated five leasehold positions in locations where a
tenant in bankruptcy had rejected its lease. These transactions
resulted in net gains of approximately $12.8 million.
During 2003, KDI sold four of its recently completed projects and 26
out-parcels, in separate transactions, for approximately $134.6
million, which resulted in the recognition of pre-tax gains of
approximately $17.5 million.
During 2002, KDI sold four of its recently completed projects and eight
out-parcels for approximately $128.7 million including the
assignment of approximately $17.7 million in mortgage debt
encumbering one of the properties. The sales resulted in pre-tax
gains of approximately $15.9 million.
6. Adjustment of Property Carrying Values:
As part of the Company's periodic assessment of its real estate
properties with regard to both the extent to which such assets are
consistent with the Company's long-term real estate investment
objectives and the performance and prospects of each asset the
Company determined in 2002 that its investment in four operating
properties comprised of an aggregate 0.4 million square feet of GLA
with an aggregate net book value of approximately $23.8 million,
may not be fully recoverable. Based upon management's assessment of
current market conditions and lack of demand for the properties,
the Company reduced its anticipated holding period of these
investments. As a result of the reduction in the anticipated
holding period, together with a reassessment of the potential
future operating cash flows of the properties and the effects of
current market conditions, the Company determined that its
investment in these assets was not fully recoverable and recorded
an adjustment of property carrying values aggregating approximately
$12.5 million in 2002, of which approximately $1.5 million is
included in the caption Income from discontinued operations on the
Company's Consolidated Statements of Income.
7. Discontinued Operations and Assets Held for Sale:
In August 2001, the FASB issued Statement of Financial Accounting
Standards No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets ("SFAS 144"). SFAS 144 established criteria
beyond that previously specified in Statement of Financial
Accounting Standards No. 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of
("SFAS 121"), to determine when a long-lived asset is classified as
held for sale, and it provides a single accounting model for the
disposal of long-lived assets. SFAS 144 was effective beginning
January 1, 2002. In accordance with SFAS 144, the Company now
reports as discontinued operations assets held for sale (as defined
by SFAS 144) as of the end of the current period and assets sold
subsequent to January 1, 2002. All results of these discontinued
operations, are included in a separate component of income on the
Consolidated Statements of Income under the caption Discontinued
operations. This change has resulted in certain reclassifications
of 2003, 2002 and 2001 financial statement amounts.
69
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
The components of Income from discontinued operations for each of the
three years in the period ended December 31, 2003 are shown below.
These include the results of operations through the date of each
respective sale for properties sold during 2003 and 2002 and a full
year of operations for those assets classified as held for sale as
of December 31, 2003, (in thousands):
2003 2002 2001
------- ---------- ---------
Discontinued Operations:
Revenues from rental property $ 16,945 $ 27,328 $ 37,117
Rental property expenses (4,283) (10,979) (10,161)
--------- ----------- ----------
Income from property operations 12,662 16,349 26,956
Depreciation of rental property (2,830) (5,780) (5,699)
Other income/(expense) 191 (2,641) (3,066)
-------- ----------- ----------
Income from discontinued operating properties 10,023 7,928 18,191
Gain on early extinguishment of debt 6,760 3,222 -
Adjustment of property carrying values (4,016) (22,030) -
Gain on disposition of operating properties 47,657 12,778 -
-------- ----------- ----------
Income from discontinued operations $ 60,424 $ 1,898 $ 18,191
======== =========== ==========
During December 2003, the Company identified two operating properties,
comprised of approximately 0.2 million square feet of GLA, as "Held
for Sale" in accordance with SFAS 144. The book value of these
properties, aggregating approximately $19.4 million, net of
accumulated depreciation of approximately $2.1 million, exceeded
their estimated fair value. The Company's determination of the fair
value of these properties, aggregating approximately $15.4 million,
is based upon contracts of sale with third parties less estimated
selling costs. As a result, the Company recorded an adjustment of
property carrying values of approximately $4.0 million. This
adjustment is included, along with the related property operations
for the current and comparative years, in the caption Income from
discontinued operations on the Company's Consolidated Statements of
Income.
During 2003, the Company reached agreement with certain lenders in
connection with three individual non-recourse mortgages encumbering
three former Kmart sites. The Company paid approximately $14.2
million in full satisfaction of these loans which aggregated
approximately $24.0 million. As a result of these transactions, the
Company recognized a gain on early extinguishment of debt of
approximately $9.7 million during 2003, of which $6.8 million is
included in Income from discontinued operations.
During November 2002, the Company disposed of an operating property
located in Chicago, IL. Net proceeds from this sale of
approximately $8.0 million were accepted by a lender in full
satisfaction of an outstanding mortgage loan of approximately $11.5
million. As a result of this transaction, the Company recognized a
gain of early extinguishment of debt of approximately $3.2 million.
During 2002, the Company identified two operating properties, comprised
of approximately 0.2 million square feet of GLA, as "Held for Sale"
in accordance with SFAS No. 144. The book value of these
properties, aggregating approximately $28.4 million, net of
accumulated depreciation of approximately $2.9 million, exceeded
their estimated fair value. The Company's determination of the fair
value of these properties, aggregating approximately $7.9 million,
is based upon executed contracts of sale with third parties less
estimated selling costs. As a result, the Company recorded an
adjustment of property carrying values of $20.5 million.
8. Investment and Advances in Real Estate Joint Ventures:
Kimco Income REIT ("KIR") -
During 1998, the Company formed KIR, an entity that was established for
the purpose of investing in high quality real estate properties
financed primarily with individual non-recourse mortgages. These
properties include, but are not limited to, fully developed
properties with strong, stable cash flows from credit-worthy
retailers with long-term leases. The Company originally held a
99.99% limited partnership interest in KIR. Subsequent to KIR's
formation, the Company sold a significant portion of its original
interest to an institutional investor and admitted three other
limited partners. As of December 31, 2003, KIR has received total
capital commitments of $569.0 million, of which the Company
subscribed for $247.0 million and the four limited partners
subscribed for $322.0 million. As of December 31, 2003, the Company
has a 43.3% non-controlling limited partnership interest in KIR.
70
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2003, the limited partners in KIR contributed $30.0 million
towards their respective capital commitments, including $13.0
million by the Company. As of December 31, 2003, KIR had unfunded
capital commitments of $99.0 million, including $42.9 million from
the Company.
The Company's equity in income from KIR for the years ended December
31, 2003, 2002 and 2001 was approximately $19.8 million, $18.2
million and $14.7 million, respectively.
In addition, KIR entered into a master management agreement with the
Company, whereby, the Company will perform services for fees
related to management, leasing, operations, supervision and
maintenance of the joint venture properties. For the years ended
December 31, 2003, 2002 and 2001, the Company (i) earned management
fees of approximately $2.9 million, $2.5 million and $1.9 million,
respectively, (ii) received reimbursement of administrative fees of
approximately $0.4 million, $1.0 million and $1.4 million,
respectively, and (iii) earned leasing commissions of approximately
$0.5 million, $0.8 million and $0.3 million, respectively.
During 2003, KIR purchased two shopping center properties, in separate
transactions, aggregating approximately 0.6 million square feet of
GLA for approximately $103.5 million.
During 2003, KIR disposed of two out-parcels in Las Vegas, NV, for an
aggregate sales price of approximately $1.4 million, which
approximated their net book value.
During 2003, KIR obtained individual non-recourse, non-cross
collateralized fixed-rate ten year mortgages aggregating $78.0
million on two of its previously unencumbered properties with rates
ranging from 5.54% to 5.82% per annum. The net proceeds were used
to satisfy the outstanding balance on the secured credit facility
and partially fund the acquisition of various shopping center
properties.
During September 2003, KIR elected to terminate its secured revolving
credit facility. This facility was scheduled to expire in November
2003 and had $5.0 million outstanding at the time of termination,
which was paid in full. At December 31, 2002, there was $15.0
million outstanding under this facility.
During 2002, KIR purchased five shopping center properties, in separate
transactions, aggregating approximately 1.8 million square feet of
GLA for approximately $213.5 million, including the assumption of
approximately $63.1 million of mortgage debt encumbering two of the
properties.
During July 2002, KIR disposed of a shopping center property in Aurora,
IL for an aggregate sales price of approximately $2.4 million,
which represented the approximate book value of the property.
During 2002, KIR obtained individual non-recourse, non-cross
collateralized fixed-rate ten year mortgages aggregating
approximately $170.3 million on seven of its previously
unencumbered properties with rates ranging from 5.95% to 7.38% per
annum. The net proceeds were used to finance the acquisition of
various shopping center properties.
As of December 31, 2003, the KIR portfolio was comprised of 70
shopping center properties aggregating approximately 14.6 million
square feet of GLA located in 21 states.
RioCan Investments -
During October 2001, the Company formed a joint venture (the "RioCan
Venture") with RioCan Real Estate Investment Trust ("RioCan") in
which the Company has a 50% non-controlling interest, to acquire
retail properties and development projects in Canada. The
acquisition and development projects are to be sourced and managed
by RioCan and are subject to review and approval by a joint
oversight committee consisting of RioCan management and the
Company's management personnel. Capital contributions will only be
required as suitable opportunities arise and are agreed to by the
Company and RioCan.
71
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2003, the RioCan Venture acquired a shopping center property
comprising approximately 0.2 million square feet of GLA for a price
of approximately CAD $42.6 (approximately USD $29.0 million)
including the assumption of approximately CAD $28.7 (approximately
USD $19.6 million) of mortgage debt. Additionally during 2003, the
RioCan Venture acquired, in a single transaction, four parcels of
land adjacent to an existing property for a purchase price of
approximately CAD $18.7 million (approximately USD $14.2 million).
This property was subsequently encumbered with non-recourse
mortgage debt of approximately CAD $16.3 million (approximately USD
$12.4 million).
As of December 31, 2003, the RioCan Venture was comprised of 31
operating properties and three development properties consisting of
approximately 7.2 million square feet of GLA.
Kimco / G.E. Joint Venture ("KROP")
During 2001, the Company formed a joint venture (the "Kimco Retail
Opportunity Portfolio" or "KROP") with GE Capital Real Estate
("GECRE"), in which the Company has a 20% non-controlling interest
and manages the portfolio. The purpose of this joint venture is to
acquire established high growth potential retail properties in the
United States. Total capital commitments to KROP from GECRE and the
Company are for $200.0 million and $50.0 million, respectively, and
such commitments are funded proportionately as suitable
opportunities arise and are agreed to by GECRE and the Company.
During 2003, GECRE and the Company contributed approximately $45.6
million and $11.4 million, respectively, towards their capital
commitments. As of December 31, 2003, KROP had unfunded capital
commitments of $144.3 million, including $28.9 million by the
Company. Additionally, GECRE and the Company provided short-term
interim financing for all acquisitions made by KROP without a
mortgage in place at the time of acquisition. All such financing
bears interest at rates ranging from LIBOR plus 4.0% to LIBOR plus
5.25% and have maturities of less than one year. KROP had
outstanding short-term interim financing due to GECRE and the
Company totaling $16.8 million each as of December 31, 2003
and $17.3 million each as of December 31, 2002.
During 2003, KROP purchased eight shopping centers, in separate
transactions, aggregating 1.9 million square feet of GLA for
approximately $250.2 million, including the assumption of
approximately $6.5 million of mortgage debt encumbering one of the
properties.
During December 2003, KROP disposed of a portion of a shopping center
in Columbia, MD, for an aggregate sales price of approximately $2.8
million, which approximated the book value of the property.
During 2002, KROP purchased 16 shopping centers aggregating 1.6 million
square feet of GLA for approximately $177.8 million, including the
assumption of approximately $29.5 million of mortgage debt
encumbering three of the properties.
During October 2002, KROP disposed of a shopping center in Columbia, MD
for an aggregate sales price of approximately $2.9 million, which
resulted in a gain of approximately $0.7 million.
During 2003, KROP obtained individual non-recourse, non-cross
collateralized fixed rate mortgages aggregating approximately $89.3
million on three of its previously unencumbered properties with
rates ranging from 4.25% to 5.92% and terms ranging from five to
ten years.
During 2003, KROP obtained individual non-recourse, non-cross
collateralized variable-rate five year mortgages aggregating
approximately $35.6 million on five of its previously unencumbered
properties with rates ranging from LIBOR plus 2.2% to LIBOR plus
2.5%. In order to mitigate the risks of interest rate fluctuations
associated with these variable rate obligations, KROP entered into
interest rate cap agreements for the notional values of these
mortgages.
72
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2002, KROP obtained a cross-collateralized mortgage with a
five-year term aggregating $73.0 million on eight properties with
an interest rate of LIBOR plus 1.8%. Upon the sale of one of the
collateralized properties, $1.9 million was repaid during 2002. In
order to mitigate the risks of interest rate fluctuations
associated with this variable rate obligation, KROP entered into an
interest rate cap agreement for the notional value of this
mortgage.
As of December 31, 2003, the KROP portfolio was comprised of 23
shopping center properties aggregating approximately 3.5 million
square feet of GLA located in 12 states.
Other Real Estate Joint Ventures -
The Company and its subsidiaries have investments in and advances to
various other real estate joint ventures. These joint ventures are
engaged primarily in the operation of shopping centers which are
either owned or held under long-term operating leases.
During June 2003, the Company acquired a former Service Merchandise
property located in Novi, MI, through a joint venture, in which the
Company has a 42.5% non-controlling interest. The property was
acquired for a purchase price of approximately $4.1 million.
During June 2003, the Company acquired a property located in South
Bend, IN, through a joint venture in which the Company has a 37.5%
non-controlling interest. The property was acquired for an
aggregate purchase price of approximately $4.9 million.
During July 2003, the Company acquired a property located in Pineville,
NC, through a joint venture, in which the Company has a 20%
non-controlling interest. The property was acquired for a purchase
price of approximately $27.3 million, including $19.3 million of
non-recourse mortgaged debt encumbering the property.
During August 2003, the Company acquired a property located in
Shaumburg, IL, through a joint venture in which the Company has a
45% non-controlling interest. The property was purchased for an
aggregate purchase price of approximately $66.6 million.
Simultaneous with the acquisition, the venture obtained a $51.6
million non-recourse mortgage at a floating interest rate of LIBOR
plus 2.25%.
During December 2003, the Company, in a single transaction, sold a
50.0% interest in each of its properties located in Saltillo and
Monterrey, Mexico for an aggregate sales price of approximately MXN
$240.4 million (USD $21.4 million) which approximated 50.0% of
their aggregate carrying value. As a result, the Company has a 50%
non-controlling interest in these properties and accounts for the
investment under the equity method of accounting.
Additionally, during the year ended December 31, 2003, the Company
acquired 11 properties, in separate transactions, through various
joint ventures in which the Company has a 50% non-controlling
interest. These properties were acquired for an aggregate purchase
price of approximately $113.3 million, including $40.5 million of
non-recourse debt encumbering six of the properties.
During 2002, the Company acquired seven former Service Merchandise
locations, in separate transactions, through a venture in which the
Company has a 42.5% non-controlling interest. These properties were
purchased for an aggregate purchase price of approximately $20.9
million.
During July 2002, the Company acquired a property located in Kalamazoo,
MI, through a joint venture in which the Company has a 50%
non-controlling interest. The property was purchased for an
aggregate purchase price of approximately $6.0 million.
During December 2002, the Company acquired an out-parcel of an existing
property located in Tampa, FL, through a joint venture in which the
Company has a 50% non-controlling interest. The property was
purchased for an aggregate purchase price of approximately $4.9
million.
73
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Additionally, during 2002, the Company, in separate transactions,
disposed of two operating properties through a joint venture in
which the Company has a 50% non-controlling interest. The
properties were located in Tempe, AZ and Glendale, AZ and sold for
approximately $19.2 million and $1.7 million, respectively.
The Company accounts for its investments in unconsolidated real estate
joint ventures under the equity method of accounting.
Summarized financial information for the recurring operations of these
real estate joint ventures, is as follows (in millions):
December 31,
2003 2002
---- ----
Assets:
Real estate, net $3,313.0 $2,511.8
Other assets 156.2 132.5
-------- --------
$3,469.2 $2,644.3
======== ========
Liabilities and Partners' Capital:
Notes Payable $ 33.6 $ 49.6
Mortgages payable 2,343.7 1,720.6
Other liabilities 107.2 116.6
Minority Interest 10.8 10.8
Partners' capital 973.9 746.7
-------- --------
$3,469.2 $2,644.3
======== ========
Year Ended December 31,
2003 2002 2001
------ ------ ------
Revenues from rental property $433.5 $314.8 $209.4
------ ------ ------
Operating expenses (121.9) (78.2) (52.9)
Interest (140.1) (108.0) (74.5)
Depreciation and amortization (68.0) (41.6) (31.0)
Other, net (9.3) (4.5) (3.0)
------ ------ -------
(339.3) (232.3) (161.4)
------ ------ -------
Net income $ 94.2 $ 82.5 $48.0
====== ====== ======
Other liabilities in the accompanying Consolidated Balance Sheets
include accounts with certain real estate joint ventures totaling
approximately $11.0 million and $5.3 million at December 31, 2003
and 2002, respectively. The Company and its subsidiaries have
varying equity interests in these real estate joint ventures, which
may differ from their proportionate share of net income or loss
recognized in accordance with generally accepted accounting
principles.
The Company's maximum exposure to losses associated with its
unconsolidated joint ventures is limited to its carrying value in
these investments. As of December 31, 2003 and 2002, the Company's
carrying value in these investments approximated $487.4 million and
$390.5 million, respectively.
9. Other Real Estate Investments:
Ward Venture -
During March 2001, through a taxable REIT subsidiary, the Company
formed a real estate joint venture, (the "Ward Venture") in which
the Company has a 50% interest, for purposes of acquiring asset
designation rights for substantially all of the real estate
property interests of the bankrupt estate of Montgomery Ward LLC
and its affiliates. These asset designation rights have provided
the Ward Venture the ability to direct the ultimate disposition of
the 315 fee and leasehold interests held by the bankrupt estate.
The asset designation rights expired in August 2002 for the
leasehold positions and expire in December 2004 for the fee owned
locations. During the marketing period, the Ward Venture will be
responsible for all carrying costs associated with the properties
until the property is designated to a user. As of December 31,
2003, there were five properties which continue to be marketed.
74
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2003, the Ward Venture completed transactions on seven
properties, and the Company recognized pre-tax profits of
approximately $3.5 million.
During 2002, the Ward Venture completed transactions on 32 properties,
and the Company recognized pre-tax profits from the Ward Venture of
approximately $11.3 million.
Leveraged Lease -
During June 2002, the Company acquired a 90% equity participation
interest in an existing leveraged lease of 30 properties. The
properties are leased under a long-term bond-type net lease whose
primary term expires in 2016, with the lessee having certain
renewal option rights. The Company's cash equity investment was
approximately $4.0 million. This equity investment is reported as a
net investment in leveraged lease in accordance with SFAS No. 13,
Accounting for Leases (as amended).
During 2002, four of these properties were sold whereby the proceeds
from the sales were used to paydown the mortgage debt by
approximately $9.6 million.
During 2003, an additional four properties were sold whereby the
proceeds from the sales were used to paydown the mortgage debt by
approximately $9.1 million. As of December 31, 2003, the remaining
22 properties were encumbered by third-party non-recourse debt of
approximately $73.6 million that is scheduled to fully amortize
during the primary term of the lease from a portion of the periodic
net rents receivable under the net lease.
As an equity participant in the leveraged lease, the Company has no
recourse obligation for principal or interest payments on the debt,
which is collateralized by a first mortgage lien on the properties
and collateral assignment of the lease. Accordingly, this
obligation has been offset against the related net rental
receivable under the lease.
At December 31, 2003 and 2002 the Company's net investment in leveraged
lease consists of the following (in millions):
2003 2002
---- ----
Remaining net rentals $81.9 $94.8
Estimated unguaranteed residual value 59.2 65.2
Non-recourse mortgage debt (73.6) (86.0)
Unearned and deferred income (63.6) (70.0)
------ ------
Net investment in leveraged lease $ 3.9 $ 4.0
===== =====
Kmart Venture -
During July 2002, the Company formed the Kmart Venture in which the
Company has a controlling interest for purposes of acquiring asset
designation rights for 54 former Kmart locations. The total
commitment to Kmart by the Kmart Venture, prior to the profit
sharing arrangement commencing, was approximately $43.0 million. As
of December 31, 2003, the Kmart Venture completed the designation
of all properties and has funded the total commitment of
approximately $43.0 million to Kmart.
In addition, the profit sharing arrangement commenced with the Company
recognizing pre-tax profits of approximately $0.6 million.
Kimsouth -
During November 2002, the Company, through its taxable REIT subsidiary,
together with Prometheus Southeast Retail Trust, completed the
merger and privatization of Konover Property Trust, which has been
renamed Kimsouth Realty, Inc., ("Kimsouth"). The Company acquired
44.5% of the common stock of Kimsouth, which consisted primarily of
38 retail shopping center properties comprising approximately 4.6
million square feet of GLA. Total acquisition value was
approximately $280.9 million including approximately $216.2 million
in assumed mortgage debt. The Company's investment strategy with
respect to Kimsouth includes re-tenanting, repositioning and
disposition of the properties.
75
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2003, Kimsouth disposed of 14 shopping center properties, in
separate transactions, for an aggregate sales price of
approximately $84.0 million, including the assignment of
approximately $18.4 million of mortgage debt encumbering six of the
properties. During 2003, the Company recognized pre-tax profits
from the Kimsouth investment of approximately $12.1 million.
During December 2002, Kimsouth sold its joint venture interest in a
property to its joint venture partner for net proceeds of
approximately $4.6 million and disposed of another property for net
proceeds of approximately $2.9 million.
Selected financial information for Kimsouth is as follows (in
millions):
December 31,
2003 2002
---- ----
Assets:
Operating real estate, net $125.7 $282.3
Real estate held for sale 95.5 9.4
Other assets 20.8 28.9
------ ------
$242.0 $320.6
====== ======
Liabilities and Stockholders' Equity:
Mortgages payable $137.0 $185.0
Other liabilities 3.6 3.6
Stockholders' equity 101.4 132.0
------ ------
$242.0 $320.6
====== ======
Year Ended December 31,
2003 2002
---- ----
Revenues from Rental Property $ 11.4 $ 17.6
Operating expenses (3.8) (5.3)
Interest (9.7) (7.8)
Depreciation and amortization (4.3) (6.6)
Other, net (0.1) (8.6)
------- -------
Loss from continuing operations (6.5) (10.7)
Income from discontinued operations 19.9 4.1
------ ------
Net income/(loss) $ 13.4 $ (6.6)
====== =======
As of December 31, 2003, the Kimsouth portfolio was comprised of 22
properties aggregating approximately 3.2 million square feet of GLA
located in six states.
Preferred Equity Capital -
During 2002, the Company established a preferred equity program, which
provides capital to developers and owners of shopping centers.
During 2002, the Company provided, in separate transactions, an
aggregate of approximately $25.6 million in investment capital to
developers and owners of nine shopping centers. During 2003, the
Company provided, in separate transactions, an aggregate of
approximately $45.5 million in investment capital to developers and
owners of 14 shopping centers. Additionally during 2003, the
Company received full payment plus incentive payments related to
two preferred equity investments. As of December 31, 2003, the
Company's net investment under the preferred equity program was
$66.4 million relating to 21 shopping centers. For the year ended
December 31, 2003 and 2002, the Company earned approximately $4.6
million and $1.0 million, respectively, from these investments.
Investment in Retail Store Leases -
The Company has interests in various retail store leases relating to
the anchor store premises in neighborhood and community shopping
centers. These premises have been sublet to retailers who lease the
stores pursuant to net lease agreements. Income from the investment
in these retail store leases during the years ended December 31,
2003, 2002 and 2001 was approximately $0.3 million, $0.8 million
and $3.2 million, respectively. These amounts represent sublease
revenues during the years ended December 31, 2003, 2002 and 2001 of
approximately $12.3 million, $13.9 million and $16.8 million,
respectively, less related expenses of $10.6 million, $11.7 million
and $12.2 million, respectively, and an amount, which in
management's estimate, reasonably provides for the recovery of the
investment over a period representing the expected remaining term
of the retail store leases. The Company's future minimum revenues
under the terms of all noncancellable tenant subleases and future
minimum obligations through the remaining terms of its retail store
leases, assuming no new or renegotiated leases are executed for
such premises, for future years are as follows (in millions): 2004,
$11.0 and $7.9; 2005, $10.3 and $7.7; 2006, $8.9 and $6.3; 2007,
$6.6 and $4.4; 2008, $3.9 and $2.7; and thereafter, $4.5 and $2.8,
respectively.
76
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
10. Mortgages and Other Financing Receivables:
During June 2003, the Company provided a five-year $3.5 million loan to
Grass America, Inc. ("Grass America") at an interest rate of 12.25%
per annum collateralized by certain real estate interests of Grass
America. The Company receives principal and interest payments on a
monthly basis.
During December 2003, the Company provided a four-year $8.25 million
term loan to Spartan Stores, Inc. ("Spartan") at a fixed rate of
16% per annum. This loan is collateralized by the real estate
interests of Spartan with the Company receiving principal and
interest payments monthly.
During December 2003, the Company, through a taxable REIT subsidiary,
acquired a $24.0 million participation interest in 12% senior
secured notes of the FRI-MRD Corporation ("FRI-MRD") for $13.3
million. These notes, which are currently non-performing, are
collateralized by certain equity interests and a note receivable of
a FRI-MRD subsidiary.
During March 2002, the Company provided a $50.0 million ten-year loan
to Shopko Stores, Inc., at an interest rate of 11.0% per annum
collateralized by 15 properties. The Company receives principal and
interest payments on a monthly basis. During January 2003, the
Company sold a $37.0 million participation interest in this loan to
an unaffiliated third party. The interest rate of the $37.0 million
participation interest is a variable rate based on LIBOR plus
3.50%. The Company continues to act as the servicer for the full
amount of the loan.
During 2003, the Company provided, in separate transactions, an
aggregate $16.2 million of additional mortgage financing of which
$11.5 million has been repaid. These loans have maturities
generally ranging from 3 to 30 years and accrue interest at rates
ranging from 7% to 12%.
During March 2002, the Company provided a $15.0 million three-year loan
to Gottchalks, Inc., at an interest rate of 12.0% per annum
collateralized by three properties. The Company receives principal
and interest payments on a monthly basis. As of December 31, 2003,
the outstanding loan balance was approximately $13.3 million.
During May 2002, in connection with Frank's Nursery & Crafts, Inc.
("Franks") emergence from Chapter 11 under the U.S. Bankruptcy
Code, the Company received approximately 4.3 million shares of
Frank's common stock in settlement of its pre-petition claim. The
Company also provided exit financing in the form of a $15.0 million
three-year term loan at a fixed interest rate of 10.25% per annum
collateralized by 40 real estate interests. Simultaneously, the
Company provided an additional $17.5 million revolving loan, also
at an interest rate of 10.25% per annum. Interest is payable
quarterly in arrears. As of December 31, 2003, the aggregate
outstanding loan balance was approximately $32.5 million. As an
inducement to make these loans, Frank's issued the Company
approximately 4.4 million warrants with an exercise price of $1.15
per share and 5.0 million warrants with an exercise price of $2.00
per share. During 2003, the Company had written down the remaining
carrying value of its equity investment in Frank's common stock and
fully reserved the value of Frank's warrants with a corresponding
adjustment in OCI.
During September 2002, a $27.5 million loan to Ames Department Stores,
Inc. ("AMES"), was restructured as a two-year $100.0 million
secured revolving loan of which the Company has a 40% interest.
This revolving loan is collateralized by all of Ames' real estate
interests. The loan bears interest at 8.5% per annum and provides
for contingent interest upon the successful disposition of the Ames
properties. There was no outstanding balance on the revolving loan
at December 31, 2003.
11. Cash and Cash Equivalents:
Cash and cash equivalents (demand deposits in banks, commercial paper
and certificates of deposit with original maturities of three
months or less) includes tenants' security deposits, escrowed funds
and other restricted deposits approximating $0.1 million at
December 31, 2003 and 2002.
77
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Cash and cash equivalent balances may, at a limited number of banks and
financial institutions, exceed insurable amounts. The Company
believes it mitigates its risks by investing in or through major
financial institutions. Recoverability of investments is dependent
upon the performance of the issuers.
12. Marketable Securities:
The amortized cost and estimated fair values of securities
available-for-sale and held-to-maturity at December 31, 2003 and
2002 are as follows (in thousands):
December 31, 2003
---------------------------------------------------------------
Gross Gross
Amortized Unrealized Unrealized Estimated
Cost Gains Losses Fair Value
--------- ---------- ---------- ------------
Available-for-sale:
Equity securities $18,513 $ 9,063 $ (272) $27,304
Held-to-maturity:
Other debt securities 18,373 2,926 (30) 21,269
------- ------- ------- -------
Total marketable securities $36,886 $11,989 $ (302) $48,573
======= ======= ======= =======
December 31, 2002
---------------------------------------------------------------
Gross Gross
Amortized Unrealized Unrealized Estimated
Cost Gains Losses Fair Value
--------- ---------- ---------- ------------
Available-for-sale:
Equity securities $38,875 $ 5,038 $ (873) $43,040
Held-to-maturity:
Other debt securities 23,952 2,002 (26) 25,928
------- ------- ------- -------
Total marketable securities $62,827 $ 7,040 $ (899) $68,968
======= ======= ======= =======
As of December 31, 2003, the contractual maturities of Other debt
securities classified as held-to-maturity are as follows: within
one year, $2.7 million; after one year through five years, $0.0;
after five years through 10 years, $12.1 million and after 10
years, $3.6 million. Actual maturities may differ from contractual
maturities as issuers may have the right to prepay debt obligations
with or without prepayment penalties.
13. Notes Payable:
The Company has implemented a medium-term notes ("MTN") program
pursuant to which it may, from time to time, offer for sale its
senior unsecured debt for any general corporate purposes, including
(i) funding specific liquidity requirements in its business,
including property acquisitions, development and redevelopment
costs, and (ii) managing the Company's debt maturities.
As of December 31, 2003, a total principal amount of $757.25 million,
in senior fixed-rate MTNs had been issued under the MTN program
primarily for the acquisition of neighborhood and community
shopping centers, the expansion and improvement of properties in
the Company's portfolio and the repayment of certain debt
obligations of the Company. These fixed-rate notes have maturities
ranging from ten months to ten years as of December 31, 2003 and
bear interest at rates ranging from 3.95% to 7.91%. Interest on
these fixed-rate senior unsecured notes is payable semi-annually in
arrears.
78
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During May 2003, the Company issued $50.0 million of fixed-rate
unsecured senior notes under its MTN program. This fixed rate MTN
matures in May 2010 and bears interest at 4.62% per annum, payable
semi-annually in arrears. The proceeds from this MTN issuance were
used to partially fund the redemption of the Company's $75 million
7 3/4% Class A Cumulative Redeemable Preferred Stock.
During August 2003, the Company issued $100.0 million of fixed rate
unsecured senior notes under its MTN program. This fixed rate MTN
matures in August 2008 and bears interest at 3.95% per annum,
payable semi-annually in arrears. The proceeds from this MTN
issuance were used to redeem all $100.0 million of the Company's
remarketed reset notes maturing August 18, 2008 bearing interest at
LIBOR plus 1.25%.
During October 2003, the Company issued $100.0 million of fixed rate
unsecured senior notes under its MTN program. This fixed rate MTN
matures in October 2013 and bears interest at 5.19% per annum,
payable semi-annually in arrears. The proceeds from this MTN
issuance were used for the repayment of the Company's 6.5% $100.0
million fixed-rate unsecured senior notes that matured October 1,
2003.
During July 2002, the Company issued an aggregate $102.0 million of
unsecured debt under its MTN program. These issuances consisted of
(i) an $85.0 million floating-rate MTN which matures in August 2004
and bears interest at LIBOR plus 0.50% per annum and (ii) a $17.0
million fixed-rate MTN which matures in July 2012 and bears
interest at 5.98% per annum. The proceeds from these MTN issuances
were used toward the repayment of a $110.0 million floating-rate
MTN which matured in August 2002. In addition, the Company entered
into an interest rate swap agreement on the $85.0 million
floating-rate MTN which effectively fixed the interest rate at
2.3725% per annum until November 2003. During 2003, the Company
elected not to renew the interest rate swap on the $85.0 million
MTN. At December 31, 2003, the rate on this MTN was 1.66% per
annum.
During November 2002, the Company issued $35.0 million of 4.961%
fixed-rate Senior Notes due 2007 (the "2007 Notes"). Interest on
the 2007 Notes is payable semi-annually in arrears. Net proceeds
from the issuance totaling approximately $34.9 million, after
related transaction costs of approximately $0.1 million, were
primarily used to repay outstanding borrowings on the Company's
unsecured credit facilities.
Also, during November 2002, the Company issued $200.0 million of 6%
fixed-rate Senior Notes due 2012 (the "2012 Notes"). Interest on
the 2012 Notes is payable semi-annually in arrears. The Notes were
sold at 99.79% of par value. Net proceeds from the issuance
totaling approximately $198.3 million, after related transaction
costs of approximately $1.3 million, were primarily used to repay
outstanding borrowings on the Company's unsecured credit
facilities.
As of December 31, 2003, the Company has a total principal amount of
$470.0 million, in fixed-rate unsecured senior notes. These
fixed-rate notes have maturities ranging six months to ten years as
of December 31, 2003, and bear interest at rates ranging from 4.96%
to 7.50%. Interest on these fixed-rate senior unsecured notes is
payable semi-annually in arrears.
During June 2003, the Company established a $500.0 million unsecured
revolving credit facility (the "Credit Facility") with a group of
banks, which is scheduled to expire in August 2006. This Credit
Facility replaced the Company's $250.0 million unsecured revolving
credit facility. Under the terms of the Credit Facility, funds may
be borrowed for general corporate purposes, including the funding
of (i) property acquisitions, (ii) development and redevelopment
costs, and (iii) any short-term working capital requirements.
Interest on borrowings under the Credit Facility accrues at a
spread (currently 0.55%) to LIBOR, and fluctuates in accordance
with changes in the Company's senior debt ratings. The Company's
senior debt ratings are currently A-/stable from Standard & Poors
and Baa1/stable from Moody's Investor Services. As part of this
Credit Facility, the Company has a competitive bid option where the
Company may auction up to $250.0 million of its requested
borrowings to the bank group. This competitive bid option provides
the Company the opportunity to obtain pricing below the currently
stated spread to LIBOR of 0.55%. A facility fee of 0.15% per annum
is payable quarterly in arrears. Pursuant to the terms of the
Credit Facility, the Company, among other things, is (i) subject to
maintaining certain maximum leverage ratios on both unsecured
senior corporate debt and minimum unencumbered asset and equity
levels, and (ii) restricted from paying dividends in amounts that
exceed 90% of funds from operations, as defined. As of December 31,
2003, there was $45.0 million outstanding under this Credit
Facility.
79
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During October 2003, the Company obtained a $400.0 million unsecured
bridge facility that bears interest at LIBOR plus 0.55%. This loan
is scheduled to expire September 30,2004 with an option to extend
up to $150.0 million for an additional year. The Company utilized
these proceeds to partially fund the Mid-Atlantic Realty Trust
transaction. Pursuant to the terms of this facility, the Company is
subject to the same covenants and requirements as the $500.0
million Credit Facility described above. As of December 31, 2003,
there was $329.0 million outstanding on this unsecured bridge
facility.
In accordance with the terms of the Indenture, as amended, pursuant to
which the Company's senior, unsecured notes have been issued, the
Company is (a) subject to maintaining certain maximum leverage
ratios on both unsecured senior corporate and secured debt, minimum
debt service coverage ratios and minimum equity levels, and (b)
restricted from paying dividends in amounts that exceed by more
than $26.0 million the funds from operations, as defined, generated
through the end of the calendar quarter most recently completed
prior to the declaration of such dividend; however, this dividend
limitation does not apply to any distributions necessary to
maintain the Company's qualification as a REIT providing the
Company is in compliance with its total leverage limitations.
During July 2002, the Company established an additional $150.0 million
unsecured revolving credit facility. During December 2002, the
Company paid down the outstanding balance and terminated this
facility.
The scheduled maturities of all unsecured senior notes payable as of
December 31, 2003 are approximately as follows (in millions): 2004,
$514.0; 2005, $200.25; 2006, $130.0; 2007, $195.0; 2008, $100.0 and
thereafter, $547.0.
14. Mortgages Payable:
During October 2003, in connection with the Mid-Atlantic Merger, the
Company assumed approximately $181.7 million of individual
non-recourse mortgages encumbering twenty properties, including an
aggregate premium of $24.6 million related to the fair value
adjustment of these mortgages in accordance with SFAS No. 141. As
of December 31, 2003, the aggregate outstanding balance of these
mortgages was $180.9 million with the Company realizing a $0.8
million reduction in interest expense related to the amortization
of the mortgage premium.
As part of the Company's strategy to reduce its exposure to Kmart
Corporation, the Company had previously encumbered certain Kmart
sites with individual non-recourse mortgages. As a result of the
Kmart bankruptcy filing in January 2002 and the subsequent
rejection of leases including these encumbered sites, the Company,
during July 2002, had suspended debt service payments on these
loans and began active negotiations with the respective lenders.
During 2003, the Company reached agreement with certain lenders in
connection with three individual non-recourse mortgages encumbering
three former Kmart sites. The Company paid approximately $14.2
million in full satisfaction of these loans which aggregated
approximately $24.0 million. As a result of these transactions, the
Company recognized a gain on early extinguishment of debt of
approximately $9.7 million during 2003, of which $6.8 million is
included in Income from discontinued operations.
During December 2002, the Company reached agreement with certain
lenders in connection with four former Kmart sites. The Company
paid approximately $24.2 million in full satisfaction of the loans
encumbering these properties which aggregated $46.5 million and the
Company recognized a gain on early extinguishment of debt of
approximately $22.3 million.
Mortgages payable, collateralized by certain shopping center properties
and related tenants' leases, are generally due in monthly
installments of principal and/or interest which mature at various
dates through 2023. Interest rates range from approximately 6.10%
to 9.75% (weighted average interest rate of 7.85% as of December
31, 2003). The scheduled maturities of all mortgages payable as of
December 31, 2003, are approximately as follows (in millions):
2004, $8.7; 2005, $14.2; 2006, $53.1; 2007, $12.6; 2008, $43.1 and
thereafter, $244.2.
80
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
One of the Company's properties is encumbered by approximately $6.4
million in floating-rate, tax-exempt mortgage bond financing. The
rate on this bond is reset annually, at which time bondholders have
the right to require the Company to repurchase the bonds. The
Company has engaged a remarketing agent for the purpose of offering
for resale the bonds in the event it is tendered to the Company.
All bonds tendered for redemption in the past have been remarketed
and the Company has arrangements, including letters of credit, with
banks to both collateralize the principal amount and accrued
interest on such bonds and to fund any repurchase obligations.
15. Construction Loans Payable:
During 2003, the Company obtained construction financing on seven
ground-up development projects for an aggregate loan commitment
amount of up to $152.2 million, of which approximately $45.6
million was funded for the year ended December 31, 2003. As of
December 31, 2003, the Company had a total of thirteen construction
loans with total commitments of up to $238.9 million of which $92.8
million had been funded. These loans have maturities ranging from 3
to 34 months and variable interest rates ranging from 2.87% to
5.00% at December 31, 2003. These construction loans are
collateralized by the respective projects and associated tenants'
leases. The scheduled maturities of all construction loans payable
as of December 31, 2003 are approximately as follows (in millions):
2004, $47.7; 2005, $30.1 and 2006, $15.0.
16. Fair Value Disclosure of Financial Instruments:
All financial instruments of the Company are reflected in the
accompanying Consolidated Balance Sheets at amounts which, in
management's estimation based upon an interpretation of available
market information and valuation methodologies reasonably
approximate their fair values except those listed below for which
fair values are reflected. The valuation method used to estimate
fair value for fixed rate debt is based on discounted cash flow
analyses. The fair values for marketable securities are based on
published or securities dealers' estimated market values. Such fair
value estimates are not necessarily indicative of the amounts that
would be realized upon disposition of the Company's financial
instruments. The following are financial instruments for which the
Company's estimate of fair value differs from the carrying amounts
(in thousands):
December 31,
----------------------------------------------------------------------
2003 2002
------------------------------- ------------------------------
Carrying Estimated Carrying Estimated
Amounts Fair Value Amounts Fair Value
----------- ----------- ----------- ------------
Marketable Securities $ 45,677 $ 48,573 $ 66,992 $ 68,968
Notes Payable $ 1,686,250 $ 1,756,834 $ 1,302,250 $ 1,353,884
Mortgages Payable $ 375,914 $ 421,123 $ 230,760 $ 282,361
17. Financial Instruments - Derivatives and Hedging:
The Company is exposed to the effect of changes in interest rates,
foreign currency exchange rate fluctuations and market value
fluctuations of equity securities. The Company limits these risks
by following established risk management policies and procedures
including the use of derivatives.
The principal financial instruments currently used by the Company are
interest rate swaps, foreign currency exchange forward contracts,
cross currency swaps and warrant contracts. The Company, from time
to time, hedges the future cash flows of its floating-rate debt
instruments to reduce exposure to interest rate risk principally
through interest rate swaps with major financial institutions. The
Company had interest-rate swap agreements on its $85.0 million
floating-rate MTN and on its $100.0 million floating-rate
remarketed reset notes, which were designated and qualified as cash
flow hedges of the variability in floating-rate interest payments
on the hedged debt. The Company determined that these swap
agreements were highly effective in offsetting future variable
interest cash flows related to the Company's debt portfolio.
81
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
The swap agreement relating to the Company's $100.0 million
floating-rate remarketed reset notes matured in August 2003. This
agreement was not renewed as the Company elected to pay-off its
outstanding $100.0 million floating-rate remarketed reset notes
during August 2003.
The swap agreement relating to the Company's $85.0 million
floating-rate MTN matured in November 2003. The Company has elected
not to renew this contract.
For the years ended December 31, 2003 and 2002, the change in the fair
value of the interest rate swaps was $0.6 million and $3.3 million,
respectively, which was recorded in OCI, a component of
stockholders' equity, with a corresponding liability reduction for
the same amount.
As of December 31, 2003, the Company had foreign currency forward
contracts designated as hedges of its Canadian investments in real
estate aggregating approximately CAD $184.6 million. In addition,
the Company had foreign currency forward contracts and a cross
currency swap with an aggregate notional amount of approximately
$381.8 million pesos ("MXN") (approximately USD $34.0 million)
designated as hedges of its Mexican real estate investments. In
December 2003, the Company sold 50% of its Mexican investments and
assigned approximately MXN $156.9 million of the MXN hedges in
connection with the sale of the underlying investments that were
being hedged. At December 31, 2003, the Company had remaining
Mexican net investment hedges outstanding with a notional amount of
approximately MXN $224.9 million.
The Company has designated these foreign currency agreements as net
investment hedges of the foreign currency exposure of its net
investment in Canadian and Mexican real estate operations. The
Company believes these agreements are highly effective in reducing
the exposure to fluctuations in exchange rates. As such, gains and
losses on these net investment hedges were reported in the same
manner as a translation adjustment in accordance with SFAS No. 52,
Foreign Currency Translation. During 2003, $25.1 million of
unrealized losses and $0.2 million of unrealized gains were
included in the cumulative translation adjustment relating to the
Company's net investment hedges of its Canadian and Mexican
investments.
During 2001, the Company acquired warrants to purchase the common stock
of a Canadian REIT. The Company has designated the warrants as a
cash flow hedge of the variability in expected future cash outflows
upon purchasing the common stock. The Company has determined the
hedged cash outflow is probable and expected to occur prior to the
expiration date of the warrants. The Company has determined that
the warrants are fully effective.
For the year ended December 31, 2003, the change in fair value of the
warrants resulted in an unrealized gain of approximately $6.0
million, which was recorded in OCI with a corresponding increase in
Other assets for the same amount.
The following table summarized the notional values and fair values of
the Company's derivative financial instruments as of December 31,
2003:
Fair Value
Hedge Type Notional Value Rate Maturity (in millions)
---------- -------------- ---- -------- -------------
Warrants - cash flow 2,500,000 shares of CAD 9/06 $8.3
common stock $11.02
Foreign currency forwards - net CAD $184.6 million 1.4013 - 1/05 - 7/06 ($23.8)
investment 1.6194
Foreign currency forwards - net MXN $142.5 million 11.838 - 10/04 ($0.5)
investment 12.615 11/04
MXN cross currency swap MXN $82.4 million 7.227 10/07 ($0.2)
- net investment
Foreign currency forwards - fair value CAD $5.0 million 1.5918 4/05 ($0.6)
82
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
As of December 31, 2003, these derivative instruments were reported at
their fair value as other liabilities of $25.1 million and other
assets of $8.3 million. The Company does not expect to reclassify
to earnings any of the current balance during the next 12 months.
18. Preferred Stock, Common Stock and DownREIT Unit Transactions:
At December 31, 2002, the Company had outstanding 3,000,000 Depositary
Shares (the "Class A Depositary Shares"), each such Class A
Depositary Share representing a one-tenth fractional interest of a
share of the Company's 7-3/4% Class A Cumulative Redeemable
Preferred Stock, par value $1.00 per share (the "Class A Preferred
Stock"), 2,000,000 Depositary Shares (the "Class B Depositary
Shares"), each such Class B Depositary Share representing a
one-tenth fractional interest of a share of the Company's 8-1/2%
Class B Cumulative Redeemable Preferred Stock, par value $1.00 per
share (the "Class B Preferred Stock") and 4,000,000 Depositary
Shares (the "Class C Depositary Shares"), each such Class C
Depositary Share representing a one-tenth fractional interest of a
share of the Company's 8-3/8% Class C Cumulative Redeemable
Preferred Stock, par value $1.00 per share (the "Class C Preferred
Stock").
During June 2003, the Company redeemed all 2,000,000 outstanding
depositary shares of the Company's Class B Preferred Stock, all
3,000,000 outstanding depositary shares of the Company's Class A
Preferred Stock and all 4,000,000 outstanding depositary shares of
the Company's Class C Preferred Stock, each at a redemption price
of $25.00 per depositary share, totaling $225.0 million, plus
accrued dividends. In accordance with Emerging Issues Task Force
("EITF") D-42, the Company deducted from the calculation of net
income available to common shareholders original issuance costs of
approximately $7.8 million associated with the redemption of the
Class A Preferred Stock, Class B Preferred Stock and Class C
Preferred Stock.
During June 2003, the Company issued 7,000,000 Depositary Shares (the
"Class F Depositary Shares"), each such Class F Depositary Share
representing a one-tenth fractional interest of a share of the
Company's 6.65% Class F Cumulative Redeemable Preferred Stock, par
value $1.00 per share (the "Class F Preferred Stock"). Dividends on
the Class F Depositary Shares are cumulative and payable quarterly
in arrears at the rate of 6.65% per annum based on the $25.00 per
share initial offering price, of $1.6625 per annum. The Class F
Depositary Shares are redeemable, in whole or part, for cash on or
after June 5, 2008 at the option of the Company, at a redemption
price of $25.00 per depositary share, plus any accrued and unpaid
dividends thereon. The Class F Depositary Shares are not
convertible or exchangeable for any other property or securities of
the Company. Net proceeds from the sale of the Class F Depositary
Shares, totaling approximately $169.0 million (after related
transaction costs of $6.0 million) were used to redeem all of the
Company's Class B Preferred Stock and Class C Preferred Stock and
to fund a portion of the redemption of the Company's Class A
Preferred Stock.
Voting Rights - As to any matter on which the Class F Preferred Stock,
("Preferred Stock") may vote, including any action by written
consent, each share of Preferred Stock shall be entitled to 10
votes, each of which 10 votes may be directed separately by the
holder thereof. With respect to each share of Preferred Stock, the
holder thereof may designate up to 10 proxies, with each such proxy
having the right to vote a whole number of votes (totaling 10 votes
per share of Preferred Stock). As a result, each Class F Depositary
Share is entitled to one vote.
Liquidation Rights - In the event of any liquidation, dissolution or
winding up of the affairs of the Company, the Preferred Stock
holders are entitled to be paid, out of the assets of the Company
legally available for distribution to its stockholders, a
liquidation preference of $250.00 per share ($25.00 per Class F
Depositary Share), plus an amount equal to any accrued and unpaid
dividends to the date of payment, before any distribution of assets
is made to holders of the Company's common stock or any other
capital stock that ranks junior to the Preferred Stock as to
liquidation rights.
During June 2003, the Company completed a primary public stock offering
of 2,070,000 shares of the Company's common stock. The net proceeds
from this sale of common stock, totaling approximately $76.0
million (after related transaction costs of $0.7 million) were used
for general corporate purposes, including the acquisition of
interests in real estate properties.
83
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During September 2003, the Company completed a primary public stock
offering of 2,760,000 shares of the Company's common stock. The net
proceeds from this sale of common stock, totaling approximately
$112.7 million (after related transaction costs of $1.0 million)
were used for general corporate purposes, including the acquisition
of interests in real estate properties.
During October 2002, the Company acquired an interest in a shopping
center property located in Daly City, CA valued at $80.0 million
through the issuance of approximately 2.4 million downREIT units
(the "Units") which are convertible at a ratio of 1:1 into the
Company's common stock. The downREIT unit holder has the right to
convert the Units anytime after one year. In addition, the Company
has the right to mandatorily require a conversion after ten years.
If at the time of conversion the common stock price for the 20
previous trading days is less than $33.57 per share the unit holder
would be entitled to additional shares, however, the maximum number
of additional shares is limited to 251,966 based upon a floor
common stock price of $30.36. The Company has the option to settle
the conversion in cash. Dividends on the Units are paid quarterly
at the rate of the Company's common stock dividend multiplied by
1.1057. The value of the units is included in Minority interests in
partnerships on the accompanying Consolidated Balance Sheets.
19. Supplemental schedule of non-cash investing/financing activities:
The following schedule summarizes the non-cash investing and financing
activities of the Company for the years ended December 31, 2003,
2002 and 2001 (in thousands):
2003 2002 2001
---- ---- ----
Acquisition of real estate interests by assumption of
mortgage debt $ 180,893 $ 3,477 $ 17,220
Acquisition of real estate interest by issuance of
convertible downREIT units
$ - $ 80,000 $ -
Acquisition of real estate through purchase of
partnership interests $ - $ 6,638 $ -
Investment in real estate joint ventures by issuance
of stock and contribution of property
$ - $ - $ 3,420
Disposition of real estate interests by assignment of
mortgage debt $ 23,068 $ 28,747 $ -
Proceeds held in escrow from sale of real estate
interests $ 41,194 $ 5,433 $ -
Notes received upon disposition of real estate
interests $ 14,490 $ - $ 400
Notes received upon exercise of stock options
$ 100 $ 555 $ 850
Declaration of dividends paid in succeeding period
$ 65,969 $ 59,646 $ 57,345
20. Transactions with Related Parties:
The Company, along with its joint venture partner provided KROP
short-term interim financing for all acquisitions by KROP for which
a mortgage was not in place at the time of closing. All such
financing had maturities of less than one year and bears interest
at rates ranging from LIBOR plus 4.0% to LIBOR plus 5.25% and LIBOR
plus 4.0% and LIBOR plus 4.5% for the years ended December 31, 2003
and 2002, respectively. KROP had outstanding short-term interim
financing due to GECRE and the Company totaling $16.8 million each
as of December 31, 2003 and $17.3 million each as of December 31,
2002. The Company earned $1.0 million and $0.8 million during 2003
and 2002, respectively, related to such interim financing.
84
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
The Company provides management services for shopping centers owned
principally by affiliated entities and various real estate joint
ventures in which certain stockholders of the Company have economic
interests. Such services are performed pursuant to management
agreements which provide for fees based upon a percentage of gross
revenues from the properties and other direct costs incurred in
connection with management of the centers.
Reference is made to Notes 8 and 9 for additional information
regarding transactions with related parties.
21. Commitments and Contingencies:
The Company and its subsidiaries are primarily engaged in the operation
of shopping centers which are either owned or held under long-term
leases which expire at various dates through 2087. The Company and
its subsidiaries, in turn, lease premises in these centers to
tenants pursuant to lease agreements which provide for terms
ranging generally from 5 to 25 years and for annual minimum rentals
plus incremental rents based on operating expense levels and
tenants' sales volumes. Annual minimum rentals plus incremental
rents based on operating expense levels comprised approximately 99%
of total revenues from rental property for each of the three years
ended December 31, 2003, 2002 and 2001, respectively.
The future minimum revenues from rental property under the terms of all
noncancellable tenant leases, assuming no new or renegotiated
leases are executed for such premises, for future years are
approximately as follows (in millions): 2004, $381.7; 2005, $352.2;
2006, $315.3; 2007, $280.5; 2008, $239.6 and thereafter, $1,477.2.
Minimum rental payments under the terms of all noncancellable operating
leases pertaining to its shopping center portfolio for future years
are approximately as follows (in millions): 2004, $11.3; 2005,
$10.9; 2006, $10.2; 2007, $9.9; 2008, $8.9 and thereafter, $153.5.
The Company has issued letters of credit in connection with the
collateralization of tax-exempt mortgage bonds, completion
guarantees for certain construction projects, and guaranty of
payment related to the Company's insurance program. These letters
of credit aggregate approximately $15.3 million.
Additionally, the RioCan Venture, an entity in which the Company holds
a 50% non-controlling interest, has a CAD $5.0 million
(approximately USD $3.9 million) letter of credit facility. This
facility is jointly guaranteed by RioCan and the Company and has
approximately CAD $3.1 million (approximately USD $2.4 million)
outstanding as of December 31, 2003 relating to various development
projects.
During 2003, the limited partners in KIR, an entity in which the
Company holds a 43.3% non-controlling interest, contributed $30.0
million towards their respective capital commitments, including
$13.0 million by the Company. As of December 31, 2003, KIR had
unfunded capital commitments of $99.0 million, including $42.9
million from the Company.
22. Incentive Plans:
The Company maintains a stock option plan (the "Plan") pursuant to
which a maximum 18,500,000 shares of the Company's common stock may
be issued for qualified and non-qualified options. Options granted
under the Plan generally vest ratably over a three-year term,
expire ten years from the date of grant and are exercisable at the
market price on the date of grant, unless otherwise determined by
the Board in its sole discretion. In addition, the Plan provides
for the granting of certain options to each of the Company's
non-employee directors (the "Independent Directors") and permits
such Independent Directors to elect to receive deferred stock
awards in lieu of directors' fees.
85
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Information with respect to stock options under the Plan for the years
ended December 31, 2003, 2002 and 2001 is as follows:
Weighted Average
Exercise Price
Shares Per Share
------ ---------
Options outstanding, December 31, 2000 5,538,795 $22.44
Exercised (1,694,227) $20.62
Granted 2,119,175 $30.71
Forfeited (54,390) $25.76
----------
Options outstanding, December 31, 2001 5,909,353 $25.90
Exercised (307,831) $18.76
Granted 1,562,525 $31.27
Forfeited (61,974) $27.99
----------
Options outstanding, December 31, 2002 7,102,073 $27.37
Exercised (1,078,203) $23.92
Granted 1,621,438 $43.34
Forfeited (89,503) $31.16
----------
Options outstanding, December 31, 2003 7,555,805 $31.24
=========
Options exercisable -
December 31, 2001 2,369,288 $21.98
========= ======
December 31, 2002 3,298,417 $24.06
========= ======
December 31, 2003 3,619,774 $26.47
========= ======
The exercise prices for options outstanding as of December 31, 2003
range from $14.78 to $44.36 per share. The weighted average
remaining contractual life for options outstanding as of December
31, 2003 was approximately 7.7 years. Options to purchase
5,109,883, 1,731,321 and 3,293,846 shares of the Company's common
stock were available for issuance under the Plan at December 31,
2003, 2002 and 2001, respectively.
The Company maintains a 401(k) retirement plan covering substantially
all officers and employees which permits participants to defer up
to the maximum allowable amount determined by the Internal Revenue
Service of their eligible compensation. This deferred compensation,
together with Company matching contributions which generally equal
employee deferrals up to a maximum of 5% of their eligible
compensation, is fully vested and funded as of December 31, 2003.
Company contributions to the plan were approximately $0.8 million,
$0.7 million and $0.7 million for the years ended December 31,
2003, 2002 and 2001, respectively.
23. Income Taxes:
The Company elected to qualify as a REIT in accordance with the Code
commencing with its taxable year which began January 1, 1992. To
qualify as a REIT, the Company must meet a number of organizational
and operational requirements, including a requirement that it
currently distribute at least 90% of its adjusted REIT taxable
income to its stockholders. It is management's intention to adhere
to these requirements and maintain the Company's REIT status. As a
REIT, the Company generally will not be subject to corporate
federal income tax, provided that distributions to its stockholders
equal at least the amount of its REIT taxable income as defined
under the Code. If the Company fails to qualify as a REIT in any
taxable year, it will be subject to federal income taxes at regular
corporate rates (including any applicable alternative minimum tax)
and may not be able to qualify as a REIT for four subsequent
taxable years. Even if the Company qualifies for taxation as a
REIT, the Company is subject to certain state and local taxes on
its income and property and federal income and excise taxes on its
undistributed taxable income. In addition, taxable income from
non-REIT activities managed through taxable REIT subsidiaries is
subject to federal, state and local income taxes.
Reconciliation between GAAP Net Income and Federal Taxable Income:
The following table reconciles GAAP net income to taxable income for
the years ended December 31, 2003, 2002 and 2001 (in thousands):
86
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
2003 2002 2001
(Estimated) (Actual) (Actual)
----------- -------- --------
GAAP net income $307,879 $245,668 $236,538
Less: GAAP net income of taxable REIT subsidiaries (12,814) (23,573) (29,063)
--------- --------- ---------
GAAP net income from REIT operations (Note 1) 295,065 222,095 207,475
Net book depreciation in excess of tax depreciation (40,781) 4,132 3,612
Deferred and prepaid rents (6,000) (5,944) (6,647)
Exercise of non-qualified stock options (11,900) (2,151) (15,354)
Book/tax differences from investments in real estate
joint ventures (10,838) (18,994) (3,206)
Book/tax difference on sale of real property (30,432) (13,346) 3,864
Book adjustment to property carrying values 4,016 33,030 -
Other book/tax differences, net (3,600) 11,719 8,999
--------- -------- --------
Adjusted taxable income subject to 90% dividend
requirements $195,530 $230,541 $198,743
======== ======== ========
Note 1 - All adjustments to "GAAP net income from REIT operations" are
net of amounts attributable to minority interest and taxable REIT
subsidiaries.
Reconciliation between Cash Dividends Paid and Dividends Paid
Deductions (in thousands):
Cash dividends paid exceeded the dividends paid deduction for the year
ended December 31, 2003 and amounted to $246,301. For the years
ended December 31, 2002 and 2001, cash dividends paid were equal to
the dividends paid deduction and amounted to $235,602 and $209,785,
respectively.
Characterization of Distributions:
The following characterizes distributions paid for the years ended
December 31, 2003, 2002 and 2001 (in thousands):
2003 2002 2001
---- ---- ----
Preferred Dividends
Ordinary income $13,169 84% $17,935 96% $26,253 100%
Capital gain 2,451 16% 764 4% - -
-------- ---- -------- ---- -------- ----
$15,620 100% $18,699 100% $26,253 100%
-------- -------- --------
Common Dividends
Ordinary income $171,071 74% $208,040 96% $174,380 95%
Capital gain 31,840 14% 8,863 4% - -
Return of capital 27,770 12% - - 9,152 5%
-------- ----- -------- ---- -------- ----
$230,681 100% $216,903 100% $183,532 100%
-------- -------- --------
Total dividends
distributed $246,301 $235,602 $209,785
======== ======== ========
Taxable REIT Subsidiaries ("TRS"):
Commencing January 1, 2001, the Company is subject to federal, state
and local income taxes on the income from its TRS activities.
Income taxes have been provided for on the asset and liability method
as required by Statement of Financial Accounting Standards No. 109,
Accounting for Income Taxes. Under the asset and liability method,
deferred income taxes are recognized for the temporary differences
between the financial reporting basis and the tax basis of the TRS
assets and liabilities.
The Company's TRS income and provision for income taxes for the years
ended December 31, 2003, 2002 and 2001, are summarized as follows
(in thousands):
87
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
2003 2002 2001
---- ---- ----
Net income before income taxes $21,328 $36,477 $48,439
------- ------- -------
Less provision for income taxes:
Federal 7,104 10,538 15,682
State and local 1,410 2,366 3,694
------ ------- -------
Total tax provision 8,514 12,904 19,376
------ ------- -------
TRS net income $12,814 $23,573 $29,063
======= ======= =======
Deferred tax assets of approximately $11.0 million and $4.4 million and
deferred tax liabilities of approximately $7.5 million and $1.7
million are included in the caption Other assets and Other
liabilities on the accompanying Consolidated Balance Sheets at
December 31, 2003 and 2002, respectively. These deferred tax assets
and liabilities relate primarily to differences in the timing of
the recognition of income/(loss) between GAAP and tax basis of
accounting of (i) real estate joint ventures, (ii) other real
estate investments and (iii) other deductible temporary
differences.
The income tax provision differs from the amount computed by applying
the statutory federal income tax rate to taxable income before
income taxes as follows (in thousands):
2003 2002 2001
---- ---- ----
Federal provision at statutory tax
rate (35%) $7,465 $12,767 $16,954
State and local taxes, net of federal
benefit 1,049 2,010 2,422
Other - (1,873) -
------ -------- -------
$8,514 $12,904 $19,376
====== ======= =======
24. Supplemental Financial Information:
The following represents the results of operations, expressed in
thousands except per share amounts, for each quarter during years
2003 and 2002:
2003 (Unaudited)
------------------------------------------------------------
Mar. 31 June 30 Sept. 30 Dec. 31
------- ------- -------- -------
Revenues from rental property(1) $119,651 $114,988 $118,450 $126,575
Net income $70,961 $61,346 $91,504 $84,068
Net income per common share:
Basic $.63 $.47 $.82 $.73
Diluted $.63 $.46 $.80 $.72
2002 (Unaudited)
------------------------------------------------------------
Mar. 31 June 30 Sept. 30 Dec. 31
------- ------- -------- -------
Revenues from rental property(1) $107,574 $107,911 $105,937 $111,355
Net income $60,894 $61,055 $60,756 $62,963
Net income per common share:
Basic $.54 $.54 $.54 $.56
Diluted $.53 $.54 $.53 $.56
(1) All periods have been adjusted to reflect the impact of
operating properties sold during 2003 and 2002, and properties
classified as held for sale as of December 31, 2003 which are
reflected in the caption Discontinued operations on the
accompanying Consolidated Statements of Income.
Accounts and notes receivable in the accompanying Consolidated Balance
Sheets are net of estimated unrecoverable amounts of approximately
$9.7 million and $5.8 million at December 31, 2003 and 2002,
respectively.
88
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
25. Pro Forma Financial Information (Unaudited):
As discussed in Notes 3, 4 and 5, the Company and certain of its
subsidiaries acquired and disposed of interests in certain
operating properties during 2003. The pro forma financial
information set forth below is based upon the Company's historical
Consolidated Statements of Income for the years ended December 31,
2003 and 2002, adjusted to give effect to these transactions as of
January 1, 2002.
The pro forma financial information is presented for informational
purposes only and may not be indicative of what actual results of
operations would have been had the transactions occurred on January
1, 2002, nor does it purport to represent the results of operations
for future periods. (Amounts presented in millions, except per
share figures.)
Years ended December 31,
2003 2002
---- ----
Revenues from rental property $530.3 $510.5
Net income $260.4 $269.0
Net income per common share:
Basic $2.22 $2.29
===== =====
Diluted $2.19 $2.27
===== =====
89
KIMCO REALTY CORPORATION AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
For Years Ended December 31, 2003, 2002 and 2001
(in thousands)
Balance at Adjustments to Balance at
Beginning of Charged to valuation end of
Period expenses accounts Deductions period
----------------- --------------- ------------------ ------------------ ----------------
Year Ended December 31, 2003
Allowance for uncollectable
accounts
$5,750 $5,800 $ - ($1,900) $9,650
----------------- --------------- ------------------ ------------------ ----------------
Year Ended December 31, 2002
Allowance for uncollectable
accounts
$4,300 $2,750 $ - ($1,300) $5,750
----------------- --------------- ------------------ ------------------ ----------------
Year Ended December 31, 2001
Allowance for uncollectable
accounts
$4,000 $3,400 $ - ($3,100) $4,300
----------------- --------------- ------------------ ------------------ ----------------
90
KIMCO REALTY CORPORATION AND SUBSIDIARIES
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2003
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
INVERNESS HEIGHTS
MARKET $2,494,000 $ - $ 3,775,429 $ 2,494,000 $ 3,775,429 $ 6,269,429
FAIRFIELD SHOPPING
CENTER 529,247 2,137,493 191,059 529,247 2,328,552 2,857,799
HOOVER 279,106 7,735,873 - 279,106 7,735,873 8,014,979
AVONDALE FIESTA 2,370,000 - 335,225 1,836,809 868,416 2,705,225
FOUR PEAKS PLAZA 3,150,780 - 15,238,151 3,015,887 15,373,044 18,388,931
GILBERT FIESTA
DEVELOPMENT 1,683,843 - (1,225,050) 449,313 9,480 458,793
KIMCO MESA 679,
INC. AZ 2,915,000 11,686,291 914,588 2,915,000 12,600,879 15,515,879
MARICOPA FIESTA 2,858,753 - 1,558,719 2,858,753 1,558,719 4,417,472
METRO SQUARE 4,101,017 16,410,632 491,895 4,101,017 16,902,527 21,003,544
PEORIA CROSSING 7,212,588 - 25,542,231 6,592,835 26,161,984 32,754,819
HAYDEN PLAZA NORTH 2,015,726 4,126,509 4,983,587 2,015,726 9,110,096 11,125,822
PHOENIX, COSTCO 5,324,501 21,269,943 213,315 5,324,501 21,483,258 26,807,759
PHOENIX 2,450,341 9,802,046 291,881 2,450,341 10,093,927 12,544,268
ALHAMBRA, COSTCO 4,995,639 19,982,557 - 4,995,639 19,982,557 24,978,196
MADISON PLAZA 5,874,396 23,476,190 72,166 5,874,396 23,548,356 29,422,752
CHULA VISTA, COSTCO 6,460,743 25,863,153 2,067,978 6,460,743 27,931,131 34,391,874
CORONA HILLS, COSTCO 13,360,965 53,373,453 711,720 13,360,965 54,085,173 67,446,138
LA MIRADA
THEATRE CENTER 8,816,741 35,259,965 5,800 8,816,741 35,265,765 44,082,506
THE CENTRE 3,403,724 13,625,899 42,660 3,403,724 13,668,559 17,072,283
SANTA ANA, HOME DEPOT 4,592,364 18,345,257 - 4,592,364 18,345,257 22,937,621
SANTEE TOWN CENTER 2,252,812 9,012,256 778,545 2,252,812 9,790,801 12,043,613
WESTLAKE SHOPPING
CENTER 16,174,307 64,818,562 850,530 16,174,307 65,669,092 81,843,399
VILLAGE ON THE PARK 2,194,463 8,885,987 203,886 2,194,463 9,089,873 11,284,336
AURORA QUINCY 1,148,317 4,608,249 176,871 1,148,317 4,785,120 5,933,437
AURORA EAST BANK 1,500,568 6,180,103 139,219 1,500,568 6,319,322 7,819,890
SPRING CREEK
COLORADO 1,423,260 5,718,813 26,244 1,423,260 5,745,057 7,168,317
DENVER WEST
38TH STREET 161,167 646,983 - 161,167 646,983 808,150
ENGLEWOOD PHAR MOR 805,837 3,232,650 18,800 805,837 3,251,450 4,057,287
FORT COLLINS 1,253,497 7,625,278 - 1,253,497 7,625,278 8,878,775
HERITAGE WEST 1,526,576 6,124,074 101,887 1,526,576 6,225,961 7,752,537
WEST FARM SHOPPING
CENTER 5,805,969 23,348,024 173,962 5,805,969 23,521,986 29,327,955
N.HAVEN, HOME DEPOT 7,704,968 30,797,640 225,056 7,704,968 31,022,696 38,727,664
WATERBURY 2,253,078 9,017,012 274,246 2,253,078 9,291,258 11,544,336
ELSMERE - 3,185,642 - - 3,185,642 3,185,642
DOVER 122,741 66,738 - 122,741 66,738 189,479
MILFORD COMMONS 964,948 3,171,336 - 964,948 3,171,336 4,136,285
BRANDYWINE COMMONS 4,863,568 15,984,316 - 4,863,568 15,984,316 20,847,884
ALTAMONTE SPRINGS 770,893 3,083,574 167,155 770,893 3,250,729 4,021,622
BOCA RATON 573,875 2,295,501 1,097,481 573,875 3,392,982 3,966,857
BRADENTON 125,000 299,253 333,571 125,000 632,824 757,824
BAYSHORE GARDENS,
BRADENTON FL 2,901,000 11,738,955 350,110 2,901,000 12,089,065 14,990,065
CORAL SPRINGS 710,000 2,842,907 3,204,985 710,000 6,047,892 6,757,892
CORAL SPRINGS 1,649,000 6,626,301 157,502 1,649,000 6,783,803 8,432,803
EAST ORLANDO 491,676 1,440,000 2,879,632 1,007,882 3,803,426 4,811,308
FERN PARK 225,000 902,000 2,752,630 225,000 3,654,630 3,879,630
REGENCY PLAZA 2,410,000 9,671,160 169,799 2,410,000 9,840,959 12,250,959
SHOPPES AT AMELIA
CONCOURSE 7,600,000 - 127,357 7,600,000 127,357 7,727,357
KISSIMMEE 1,328,536 5,296,652 1,767,960 1,328,536 7,064,612 8,393,148
LAUDERDALE LAKES 342,420 2,416,645 2,866,599 342,420 5,283,244 5,625,664
MERCHANTS WALK 2,580,816 10,366,090 368,803 2,580,816 10,734,892 13,315,709
LARGO 293,686 792,119 1,154,515 293,686 1,946,634 2,240,320
LEESBURG - 171,636 173,537 - 345,173 345,173
LARGO EAST BAY 2,832,296 11,329,185 1,121,122 2,832,296 12,450,307 15,282,603
LAUDERHILL 1,002,733 2,602,415 10,530,161 1,774,443 12,360,866 14,135,309
MELBOURNE - 1,754,000 2,920,178 - 4,674,178 4,674,178
GROVE GATE 365,893 1,049,172 1,139,954 365,893 2,189,126 2,555,019
NORTH MIAMI 732,914 4,080,460 10,754,642 732,914 14,835,102 15,568,016
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
INVERNESS HEIGHTS
MARKET $ - $ 6,269,429 $ 1,021,674 2003(C)
FAIRFIELD SHOPPING
CENTER 196,849 2,660,950 - 2000(A)
HOOVER 793,596 7,221,383 - 1999(A)
AVONDALE FIESTA - 2,705,225 1,241,430 2003(C)
FOUR PEAKS PLAZA - 18,388,931 8,008,661 2001(C)
GILBERT FIESTA
DEVELOPMENT - 458,793 - 2001(C)
KIMCO MESA 679,
INC. AZ 1,775,882 13,739,997 - 1998(A)
MARICOPA FIESTA - 4,417,472 2,496,344 2003(C)
METRO SQUARE 2,354,027 18,649,517 - 1998(A)
PEORIA CROSSING - 32,754,819 14,771,480 2000(C)
HAYDEN PLAZA NORTH 892,095 10,233,727 - 1998(A)
PHOENIX, COSTCO 3,022,240 23,785,519 - 1998(A)
PHOENIX 1,570,403 10,973,865 7,495,685 1997(A)
ALHAMBRA, COSTCO 2,831,757 22,146,439 - 1998(A)
MADISON PLAZA 3,316,679 26,106,073 - 1998(A)
CHULA VISTA, COSTCO 3,775,147 30,616,727 - 1998(A)
CORONA HILLS, COSTCO 7,583,405 59,862,733 - 1998(A)
LA MIRADA
THEATRE CENTER 4,976,644 39,105,862 - 1998(A)
THE CENTRE 1,443,354 15,628,929 7,739,844 1999(A)
SANTA ANA, HOME DEPOT 2,580,313 20,357,308 - 1998(A)
SANTEE TOWN CENTER 1,209,091 10,834,522 - 1998(A)
WESTLAKE SHOPPING
CENTER 1,941,605 79,901,794 - 2002(A)
VILLAGE ON THE PARK 1,386,276 9,898,061 - 1998(A)
AURORA QUINCY 712,105 5,221,331 2,428,536 1998(A)
AURORA EAST BANK 946,947 6,872,944 - 1998(A)
SPRING CREEK
COLORADO 868,855 6,299,462 - 1998(A)
DENVER WEST
38TH STREET 98,132 710,019 - 1998(A)
ENGLEWOOD PHAR MOR 491,784 3,565,503 1,138,878 1998(A)
FORT COLLINS 749,494 8,129,281 2,921,172 2000(A)
HERITAGE WEST 937,243 6,815,294 - 1998(A)
WEST FARM SHOPPING
CENTER 3,260,856 26,067,099 13,044,337 1998(A)
N.HAVEN, HOME DEPOT 4,336,001 34,391,663 - 1998(A)
WATERBURY 2,374,198 9,170,139 - 1993(A)
ELSMERE 2,843,951 341,691 - 1979(C)
DOVER - 189,479 - 2003(A)
MILFORD COMMONS 34,069 4,102,216 - 2003(A)
BRANDYWINE COMMONS 129,751 20,718,132 - 2003(A)
ALTAMONTE SPRINGS 634,908 3,386,714 - 1995(A)
BOCA RATON 1,040,160 2,926,698 - 1992(A)
BRADENTON 388,458 369,365 - 1968(C)
BAYSHORE GARDENS,
BRADENTON FL 1,718,187 13,271,878 - 1998(A)
CORAL SPRINGS 1,168,911 5,588,981 - 1994(A)
CORAL SPRINGS 1,041,717 7,391,085 - 1997(A)
EAST ORLANDO 1,931,418 2,879,890 - 1971(C)
FERN PARK 1,795,872 2,083,758 - 1968(C)
REGENCY PLAZA 1,017,434 11,233,525 8,671,846 1999(A)
SHOPPES AT AMELIA
CONCOURSE - 7,727,357 - 2003(C)
KISSIMMEE 1,337,734 7,055,413 - 1996(A)
LAUDERDALE LAKES 3,508,502 2,117,162 - 1968(C)
MERCHANTS WALK 623,567 12,692,142 - 2001(A)
LARGO 1,620,019 620,300 - 1968(C)
LEESBURG 224,520 120,652 - 1969(C)
LARGO EAST BAY 4,098,961 11,183,642 - 1992(A)
LAUDERHILL 5,667,807 8,467,502 - 1974(C)
MELBOURNE 1,856,886 2,817,293 - 1968(C)
GROVE GATE 1,562,771 992,248 - 1968(C)
NORTH MIAMI 5,264,743 10,303,273 - 1985(A)
91
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
MILLER ROAD 1,138,082 4,552,327 1,531,207 1,138,082 6,083,534 7,221,616
MARGATE 2,948,530 11,754,120 2,602,207 2,948,530 14,356,327 17,304,857
MELBOURNE 715,844 2,878,374 961,470 715,844 3,839,844 4,555,688
MT. DORA 1,011,000 4,062,890 116,171 1,011,000 4,179,061 5,190,061
ORLANDO 923,956 3,646,904 1,862,607 1,172,119 5,261,348 6,433,467
RENAISSANCE CENTER 9,104,379 36,540,873 3,928,942 9,104,379 40,469,815 49,574,194
SAND LAKE 3,092,706 12,370,824 1,182,395 3,092,706 13,553,219 16,645,925
ORLANDO 560,800 2,268,112 2,727,234 580,030 4,976,116 5,556,146
OCALA 1,980,000 7,927,484 3,409,972 1,980,000 11,337,456 13,317,456
POMPANO BEACH 97,169 874,442 1,234,339 97,169 2,108,781 2,205,950
PALATKA 130,844 556,658 1,046,540 130,844 1,603,198 1,734,042
PANAMA CITY 1,962,500 - 4,703,953 1,962,500 4,703,953 6,666,453
ST. PETERSBURG - 917,360 786,647 - 1,704,007 1,704,007
TUTTLE BEE SARASOTA 254,961 828,465 1,738,002 254,961 2,566,467 2,821,428
SOUTH EAST SARASOTA 1,283,400 5,133,544 3,405,338 1,440,264 8,382,018 9,822,282
SANFORD 1,832,732 9,523,261 5,498,867 1,832,732 15,022,128 16,854,860
STUART 2,109,677 8,415,323 436,777 2,109,677 8,852,100 10,961,777
SOUTH MIAMI 1,280,440 5,133,825 2,554,710 1,280,440 7,688,535 8,968,975
TALLAHASSEE - 2,431,659 23,506,501 - 25,938,160 25,938,160
TAMPA, FLORIDA 3,054,280 - 8,932,812 3,054,280 8,932,812 11,987,092
TAMPA 2,820,000 11,283,189 1,422,292 2,820,000 12,705,481 15,525,481
VILLAGE COMMONS S.C. 2,192,331 8,774,158 432,183 2,192,331 9,206,341 11,398,672
WEST PALM BEACH 550,896 2,298,964 582,219 550,896 2,881,183 3,432,079
THE SHOPS AT
WEST MELBOURNE 2,200,000 8,829,541 2,281,164 2,200,000 11,110,705 13,310,705
JONESBORO RD. &I-285 468,118 1,872,473 53,114 468,118 1,925,587 2,393,705
AUGUSTA 1,482,564 5,928,122 1,785,371 1,482,564 7,713,493 9,196,057
MACON 262,700 1,487,860 1,562,098 349,326 2,963,332 3,312,658
SAVANNAH 2,052,270 8,232,978 676,374 2,052,270 8,909,352 10,961,622
SAVANNAH 652,255 2,616,522 385,802 652,255 3,002,324 3,654,579
CLIVE 500,525 2,002,101 - 500,525 2,002,101 2,502,626
SOUTHDALE SHOPPING
CENTER 1,720,330 6,916,294 793,477 1,720,330 7,709,770 9,430,100
DES MOINES 500,525 2,559,019 37,079 500,525 2,596,098 3,096,623
DUBUQUE - 2,152,476 - - 2,152,476 2,152,476
WATERLOO 500,525 2,002,101 4,162 500,525 2,006,263 2,506,788
ADDISON - 753,343 1,446,475 - 2,199,818 2,199,818
ALTON, BELTLINE HWY 329,532 1,987,981 59,934 329,532 2,047,915 2,377,447
AURORA, N. LAKE 2,059,908 9,531,721 - 2,059,908 9,531,721 11,591,629
KRC ARLINGTON HEIGHT 1,983,517 9,178,272 (5,250,000) 1,983,517 3,928,272 5,911,789
BLOOMINGTON 805,521 2,222,353 5,155,864 805,521 7,378,217 8,183,738
BELLEVILLE,
WESTFIELD PLAZA - 5,372,253 - - 5,372,253 5,372,253
BRADLEY 500,422 2,001,687 - 500,422 2,001,687 2,502,109
CALUMET CITY 1,479,217 8,815,760 63,363 1,479,217 8,879,123 10,358,340
COUNTRYSIDE - 4,770,671 35,625 - 4,806,296 4,806,296
CARBONDALE - 500,000 - - 500,000 500,000
CHICAGO - 2,687,046 56,256 - 2,743,302 2,743,302
CHAMPAIGN, NEIL ST. 230,519 1,285,460 49,327 230,519 1,334,787 1,565,306
ELSTON 1,010,375 5,692,211 - 1,010,375 5,692,211 6,702,586
S. CICERO - 1,541,560 149,203 - 1,690,763 1,690,763
CRYSTAL LAKE, NW HWY 179,964 1,025,811 270,416 180,269 1,295,922 1,476,191
BUTTERFIELD SQUARE 1,601,960 6,637,926 299,681 1,603,277 6,936,290 8,539,567
DOWNERS PARK PLAZA 2,510,455 10,164,494 242,902 2,510,455 10,407,396 12,917,851
DOWNER GROVE 811,778 4,322,956 1,664,058 811,778 5,987,014 6,798,792
ELGIN 842,555 2,108,674 1,829,451 842,555 3,938,125 4,780,680
FOREST PARK - 2,335,884 - - 2,335,884 2,335,884
FAIRVIEW HTS,
BELLVILLE RD. - 11,866,880 1,781,567 - 13,648,447 13,648,447
GENEVA 500,422 12,917,712 14,927 500,422 12,932,639 13,433,061
MATTERSON 950,515 6,292,319 9,419,747 950,515 15,712,066 16,662,581
MT. PROSPECT 1,017,345 6,572,176 2,456,590 1,017,345 9,028,766 10,046,111
MUNDELIEN, S. LAKE 1,127,720 5,826,129 42,333 1,129,634 5,866,548 6,996,182
NORRIDGE - 2,918,315 - - 2,918,315 2,918,315
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
MILLER ROAD 4,422,647 2,798,968 - 1986(A)
MARGATE 3,400,420 13,904,437 - 1993(A)
MELBOURNE 785,236 3,770,452 - 1994(A)
MT. DORA 641,613 4,548,448 - 1997(A)
ORLANDO 1,310,752 5,122,716 - 1995(A)
RENAISSANCE CENTER 5,967,944 43,606,251 - 1998(A)
SAND LAKE 3,242,470 13,403,454 - 1994(A)
ORLANDO 707,751 4,848,395 - 1996(A)
OCALA 1,436,813 11,880,643 - 1997(A)
POMPANO BEACH 1,197,657 1,008,293 - 1968(C)
PALATKA 688,777 1,045,265 - 1970(C)
PANAMA CITY - 6,666,453 5,288,222 2002(C)
ST. PETERSBURG 695,350 1,008,657 - 1968(C)
TUTTLE BEE SARASOTA 1,600,241 1,221,187 - 1970(C)
SOUTH EAST SARASOTA 2,587,919 7,234,364 - 1989(A)
SANFORD 4,960,109 11,894,750 - 1989(A)
STUART 2,114,739 8,847,038 - 1994(A)
SOUTH MIAMI 1,483,973 7,485,002 - 1995(A)
TALLAHASSEE - 25,938,160 21,500,000 2000(C)
TAMPA, FLORIDA - 11,987,092 - 2001(C)
TAMPA 2,098,873 13,426,608 - 1997(A)
VILLAGE COMMONS S.C. 1,151,816 10,246,855 - 1998(A)
WEST PALM BEACH 529,331 2,902,748 - 1995(A)
THE SHOPS AT
WEST MELBOURNE 1,363,921 11,946,784 - 1998(A)
JONESBORO RD. &I-285 854,365 1,539,340 - 1988(A)
AUGUSTA 1,271,556 7,924,501 - 1995(A)
MACON 1,527,745 1,784,913 - 1969(C)
SAVANNAH 2,265,657 8,695,965 - 1993(A)
SAVANNAH 582,351 3,072,228 - 1995(A)
CLIVE 406,410 2,096,216 - 1996(A)
SOUTHDALE SHOPPING
CENTER 912,228 8,517,873 4,658,834 1999(A)
DES MOINES 508,473 2,588,150 - 1996(A)
DUBUQUE 340,365 1,812,111 - 1997(A)
WATERLOO 406,410 2,100,378 - 1996(A)
ADDISON 1,273,852 925,966 - 1968(C)
ALTON, BELTLINE HWY 652,463 1,724,984 - 1998(A)
AURORA, N. LAKE 1,322,614 10,269,015 - 1998(A)
KRC ARLINGTON HEIGHT 1,121,758 4,790,031 - 1998(A)
BLOOMINGTON 3,584,237 4,599,500 - 1972(C)
BELLEVILLE,
WESTFIELD PLAZA 746,013 4,626,240 - 1998(A)
BRADLEY 464,803 2,037,306 - 1996(A)
CALUMET CITY 1,328,544 9,029,796 - 1997(A)
COUNTRYSIDE 724,718 4,081,578 - 1997(A)
CARBONDALE 64,103 435,897 - 1997(A)
CHICAGO 426,114 2,317,188 - 1997(A)
CHAMPAIGN, NEIL ST. 163,636 1,401,670 - 1998(A)
ELSTON 790,262 5,912,324 - 1997(A)
S. CICERO 269,468 1,421,295 - 1997(A)
CRYSTAL LAKE, NW HWY 153,303 1,322,887 - 1998(A)
BUTTERFIELD SQUARE 1,017,629 7,521,938 - 1998(A)
DOWNERS PARK PLAZA 1,305,408 11,612,443 - 1999(A)
DOWNER GROVE 812,517 5,986,275 - 1997(A)
ELGIN 2,110,650 2,670,030 - 1972(C)
FOREST PARK 374,123 1,961,761 - 1997(A)
FAIRVIEW HTS,
BELLVILLE RD. 1,680,618 11,967,829 - 1998(A)
GENEVA 1,922,379 11,510,682 9,529,670 1996(A)
MATTERSON 1,005,648 15,656,933 - 1997(A)
MT. PROSPECT 1,086,800 8,959,311 - 1997(A)
MUNDELIEN, S. LAKE 808,137 6,188,045 - 1998(A)
NORRIDGE 461,680 2,456,635 - 1997(A)
92
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
NAPERVILLE 669,483 4,464,998 70,678 669,483 4,535,676 5,205,159
OTTAWA 137,775 784,269 361,788 137,775 1,146,057 1,283,832
ORLAND SQUARE 1,601,960 6,425,253 8,021 1,603,564 6,431,670 8,035,234
ORLAND PARK, S. HARLEM 476,972 2,764,775 973,253 476,972 3,738,028 4,215,000
OAK LAWN 1,530,111 8,776,631 100,280 1,530,111 8,876,911 10,407,022
OAKBROOK TERRACE 1,527,188 8,679,108 2,932,327 1,527,188 11,611,435 13,138,623
PEORIA - 5,081,290 1,315,822 - 6,397,112 6,397,112
FREESTATE BOWL 343,723 1,129,198 - 343,723 1,129,198 1,472,921
SKOKIE - 2,276,360 9,488,383 2,628,440 9,136,303 11,764,743
KRC STREAMWOOD 181,962 1,057,740 181,885 181,962 1,239,625 1,421,587
WOODGROVE FESTIVAL 5,049,149 20,822,993 1,427,208 5,049,149 22,250,201 27,299,350
WAUKEGAN 203,427 1,161,847 37,012 203,772 1,198,514 1,402,286
PLAZA EAST 1,236,149 4,944,597 2,808,586 1,140,849 7,848,483 8,989,332
PLAZA WEST 808,435 3,210,187 624,109 808,435 3,834,296 4,642,731
FELBRAM 72,971 302,579 428,712 72,971 731,291 804,262
GREENWOOD 423,371 1,883,421 1,573,783 423,371 3,457,204 3,880,575
GRIFFITH - 2,495,820 (19,188) - 2,476,632 2,476,632
INDIANAPOLIS 447,600 3,607,193 2,421,883 447,600 6,029,076 6,476,676
LAFAYETTE 230,402 1,305,943 158,525 230,402 1,464,468 1,694,870
LAFAYETTE 812,810 3,252,269 1,096,559 812,810 4,348,828 5,161,638
KIMCO LAFAYETTE
MARKET PLACE 4,184,000 16,752,165 197,152 4,184,000 16,949,317 21,133,317
KRC MISHAWAKA 895 378,088 1,999,079 642 378,730 1,999,079 2,377,809
SOUTH BEND, S. HIGH ST. 183,463 1,070,401 196,858 183,463 1,267,259 1,450,722
OVERLAND PARK 1,183,911 6,335,308 142,374 1,185,906 6,475,687 7,661,593
BELLEVUE 405,217 1,743,573 138,965 405,217 1,882,538 2,287,755
TURFWAY CROSSING 2,459,874 12,532,320 - 2,459,874 12,532,320 14,992,194
LEXINGTON 1,675,031 6,848,209 5,020,794 1,551,079 11,992,955 13,544,034
PADUCAH MALL, KY - 1,047,281 (123,196) - 924,085 924,085
BATON ROUGE 3,813,873 15,260,609 1,106,214 3,813,873 16,366,823 20,180,696
KIMCO HOUMA 274, LLC 1,980,000 7,945,784 111,866 1,980,000 8,057,650 10,037,650
LAFAYETTE 2,115,000 8,508,218 8,749,742 3,678,274 15,694,685 19,372,960
GREAT BARRINGTON 642,170 2,547,830 6,977,863 751,124 9,416,739 10,167,863
DEL ALBA 3,163,534 10,456,153 - 3,163,534 10,456,153 13,619,687
SHREWSBURY
SHOPPING CENTER 1,284,168 5,284,853 4,496,351 1,284,168 9,781,203 11,065,371
CLUB CENTRE
AT PIKESVILLE 1,630,003 5,354,041 12,532,320 1,630,003 5,354,041 6,984,043
FULLERTON PLAZA 2,618,771 8,606,702 10,456,153 2,618,771 8,606,702 11,225,473
GREENBRIER 7,700,000 20,204,386 12,532,320 7,700,000 20,204,386 27,904,386
HARFORD BUSINESS PARK 307,278 1,010,280 10,456,153 307,278 1,010,280 1,317,558
INGLESIDE 5,361,167 17,559,576 - 5,361,167 17,559,576 22,920,744
ROLLING ROAD PLAZA 1,931,564 6,348,068 12,532,320 1,931,564 6,348,068 8,279,631
ROSEDALE PLAZA 2,927,954 9,611,987 10,456,153 2,927,954 9,611,987 12,539,941
SECURITY SQUARE 4,440,048 14,559,678 12,532,320 4,440,048 14,559,678 18,999,726
WILKENS BELTWAY PLAZA 3,495,347 9,510,155 10,456,153 3,495,347 9,510,155 13,005,502
WILKENS OFFICE I 728,978 2,331,383 - 728,978 2,331,383 3,060,361
WILKENS OFFICE II 830,525 2,656,145 12,532,320 830,525 2,656,145 3,486,670
WILKENS OFFICE III 317,074 1,014,050 10,456,153 317,074 1,014,050 1,331,124
YORK ROAD PLAZA 4,545,332 14,913,514 - 4,545,332 14,913,514 19,458,846
PULASKI INDUSTRIAL PARK 2,755,963 - - 2,755,963 - 2,755,963
HARFORD INDUSTRIAL PARK 2,755,863 - - 2,755,863 - 2,755,863
WILDE LAKE 1,468,038 5,869,862 16,649 1,468,038 5,886,511 7,354,548
LYNX LANE 1,019,035 4,091,894 33,241 1,019,035 4,125,135 5,144,170
OAKLAND MILLS 667,165 2,663,081 - 667,165 2,663,081 3,330,246
CLINTON BANK BUILDING 141,964 466,369 10,456,153 141,964 466,369 608,334
CLINTON BOWL 39,779 130,716 - 39,779 130,716 170,496
ENCHANTED FOREST 12,500,000 18,890,448 12,532,320 12,500,000 18,890,448 31,390,448
SHOPPES AT EASTON 3,912,673 12,859,457 10,456,153 3,912,673 12,859,457 16,772,130
VILLAGES AT URBANA 3,190,074 6,067 - 3,190,074 6,067 3,196,141
GAITHERSBURG 244,890 6,787,534 197,041 244,890 6,984,575 7,229,465
GLEN BURNIE - 1,000,000 - - 1,000,000 1,000,000
ARUNDEL PLAZA 5,358,071 13,193,129 12,532,320 5,358,071 13,193,129 18,551,199
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
NAPERVILLE 656,092 4,549,067 - 1997(A)
OTTAWA 948,295 335,537 - 1970(C)
ORLAND SQUARE 983,421 7,051,814 - 1998(A)
ORLAND PARK, S. HARLEM 419,052 3,795,948 - 1998(A)
OAK LAWN 1,349,109 9,057,912 14,632,890 1997(A)
OAKBROOK TERRACE 1,350,807 11,787,816 - 1997(A)
PEORIA 910,391 5,486,721 - 1997(A)
FREESTATE BOWL 18,188 1,454,733 - 2003(A)
SKOKIE 642,135 11,122,608 8,454,211 1997(A)
KRC STREAMWOOD 150,043 1,271,543 - 1998(A)
WOODGROVE FESTIVAL 3,019,250 24,280,100 - 1998(A)
WAUKEGAN 146,737 1,255,549 - 1998(A)
PLAZA EAST 1,328,325 7,661,008 - 1995(A)
PLAZA WEST 675,544 3,967,187 - 1995(A)
FELBRAM 502,303 301,959 - 1970(C)
GREENWOOD 1,899,649 1,980,926 - 1970(C)
GRIFFITH 381,512 2,095,120 - 1997(A)
INDIANAPOLIS 3,789,661 2,687,015 - 1986(A)
LAFAYETTE 1,197,997 496,872 - 1971(C)
LAFAYETTE 699,985 4,461,653 - 1997(A)
KIMCO LAFAYETTE
MARKET PLACE 2,369,128 18,764,189 - 1998(A)
KRC MISHAWAKA 895 276,753 2,101,056 - 1998(A)
SOUTH BEND, S. HIGH ST. 150,080 1,300,642 - 1998(A)
OVERLAND PARK 845,755 6,815,837 - 1998(A)
BELLEVUE 1,697,973 589,782 - 1976(A)
TURFWAY CROSSING 98,620 14,893,574 - 2003(A)
LEXINGTON 2,976,612 10,567,422 - 1993(A)
PADUCAH MALL, KY 213,844 710,241 - 1998(A)
BATON ROUGE 2,508,177 17,672,518 - 1997(A)
KIMCO HOUMA 274, LLC 857,164 9,180,486 - 1999(A)
LAFAYETTE 2,159,626 17,213,334 - 1997(A)
GREAT BARRINGTON 1,541,658 8,626,205 - 1994(A)
DEL ALBA 81,191 13,538,497 7,898,381 2003(A)
SHREWSBURY
SHOPPING CENTER 668,412 10,396,959 - 2000(A)
CLUB CENTRE
AT PIKESVILLE 68,973 6,915,070 5,541,966 2003(A)
FULLERTON PLAZA 51,296 11,174,178 - 2003(A)
GREENBRIER 191,272 27,713,114 14,104,510 2003(A)
HARFORD BUSINESS PARK 36,273 1,281,285 - 2003(A)
INGLESIDE 176,919 22,743,824 15,110,724 2003(A)
ROLLING ROAD PLAZA 86,187 8,193,444 - 2003(A)
ROSEDALE PLAZA 72,237 12,467,704 7,967,499 2003(A)
SECURITY SQUARE 104,906 18,894,820 12,032,580 2003(A)
WILKENS BELTWAY PLAZA 113,599 12,891,903 - 2003(A)
WILKENS OFFICE I 38,579 3,021,783 - 2003(A)
WILKENS OFFICE II 43,953 3,442,718 - 2003(A)
WILKENS OFFICE III 16,780 1,314,344 - 2003(A)
YORK ROAD PLAZA 116,114 19,342,732 8,594,695 2003(A)
PULASKI INDUSTRIAL PARK - 2,755,963 - 2003(A)
HARFORD INDUSTRIAL PARK - 2,755,863 - 2003(A)
WILDE LAKE 263,228 7,091,320 - 2002(A)
LYNX LANE 183,075 4,961,095 - 2002(A)
OAKLAND MILLS 119,297 3,210,949 - 2002(A)
CLINTON BANK BUILDING 10,428 597,906 - 2003(A)
CLINTON BOWL 4,464 166,031 - 2003(A)
ENCHANTED FOREST 256,970 31,133,478 - 2003(A)
SHOPPES AT EASTON 81,830 16,690,300 - 2003(A)
VILLAGES AT URBANA - 3,196,141 - 2003(A)
GAITHERSBURG 710,858 6,518,607 - 1999(A)
GLEN BURNIE 76,923 923,077 - 2000(A)
ARUNDEL PLAZA 119,353 18,431,847 12,489,722 2003(A)
93
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
GLEN BURNIE VILLAGE 1,576,884 5,214,397 10,456,153 1,576,884 5,214,397 6,791,281
LITTLE GLEN 382,073 1,255,291 - 382,073 1,255,291 1,637,363
HAGERSTOWN 541,389 2,165,555 1,010,343 541,389 3,175,898 3,717,287
SHAWAN PLAZA 4,500,000 21,859,285 - 4,500,000 21,859,285 26,359,285
NEW RIDGE 1,318,416 - - 1,318,416 - 1,318,416
LAUREL 349,562 1,398,250 939,535 349,562 2,337,785 2,687,347
LAUREL 274,580 1,100,968 (3,820) 274,580 1,097,148 1,371,728
LARGO/LANDOVER 982,266 27,223,105 17,631 982,266 27,240,737 28,223,003
LUTHERVILLE STATION 4,500,000 15,501,140 12,532,320 4,500,000 15,501,140 20,001,140
ORCHARD SQUARE
MEDICAL OFFICE 1,193,858 3,914,500 10,456,153 1,193,858 3,914,500 5,108,358
SOUTHWEST MIXED
USE PROPERTY 403,034 1,325,126 - 403,034 1,325,126 1,728,160
NORTH EAST STATION 1,888,211 6,205,792 10,456,153 1,888,211 6,205,792 8,094,003
NEW TOWN VILLAGE 4,800,000 24,605,177 - 4,800,000 24,605,177 29,405,177
PERRY HALL 3,733,309 12,245,774 12,532,320 3,733,309 12,245,774 15,979,083
PERRY HALL
SUPER FRESH 3,411,024 11,210,238 10,456,153 3,411,024 11,210,238 14,621,262
NORTHWOOD
INDUSTRIAL PARK 1,045,491 - 10,456,154 1,045,491 - 1,045,491
RADCLIFFE @ TOWSON 4,200,000 20,137,496 - 4,200,000 20,137,496 24,337,496
TIMONIUM CROSSING 3,488,677 11,470,792 10,456,153 3,488,677 11,470,792 14,959,469
TIMONIUM
SHOPPING CENTER 6,000,000 24,282,998 - 6,000,000 24,282,998 30,282,998
WALDORF BOWL 225,099 739,362 - 225,099 739,362 964,461
WALDORF FIRESTONE 73,127 240,625 10,456,153 73,127 240,625 313,752
WAVERLY WOODS 4,818,548 15,796,561 - 4,818,548 15,796,561 20,615,108
BANGOR, ME 403,833 1,622,331 93,752 403,833 1,716,083 2,119,916
CLAWSON 1,624,771 6,578,142 2,634,964 1,624,771 9,213,106 10,837,877
WHITE LAKE 2,300,050 9,249,607 1,389,807 2,300,050 10,639,414 12,939,464
FARMINGTON 1,098,426 4,525,723 2,082,904 1,098,426 6,608,627 7,707,053
FLINT 984,338 8,053,218 602,467 984,338 8,667,600 9,651,938
LIVONIA 178,785 925,818 645,865 178,785 1,571,683 1,750,468
MUSKEGON 391,500 958,500 813,805 391,500 1,772,305 2,163,805
LAKE CROSSING 5,064,943 - - 5,064,943 5,661,869 10,726,812
TAYLOR 1,451,397 5,806,263 235,289 1,451,397 6,041,552 7,492,949
WALKER 3,682,478 14,730,060 1,849,480 3,682,478 16,579,540 20,262,018
BRIDGETON - 2,196,834 - - 2,196,834 2,196,834
CREVE COEUR,
WOODCREST/OLIVE 1,044,598 5,475,623 502,705 960,813 6,062,112 7,022,926
CRYSTAL CITY, MI - 234,378 - - 234,378 234,378
CAPE GIRARDEAU - 2,242,469 - - 2,242,469 2,242,469
HAZELWOOD, MO - - 324,258 - 324,258 324,258
INDEPENDENCE,
NOLAND DR. 1,728,367 8,951,101 57,226 1,731,300 9,005,394 10,736,694
NORTH POINT
SHOPPING CENTER 1,935,380 7,800,746 167,922 1,935,380 7,968,668 9,904,048
KIRKWOOD - 9,704,005 7,183,333 - 16,887,338 16,887,338
KANSAS CITY 574,777 2,971,191 246,276 574,777 3,217,467 3,792,244
LEMAY 125,879 503,510 245,339 125,879 748,849 874,728
GRAVOIS 1,032,416 4,455,514 10,418,245 1,032,416 14,873,759 15,906,175
ST. CHARLES-UNDER-
DEVELOPED LAND, MO 431,960 - 758,855 431,960 758,855 1,190,815
SPRINGFIELD 2,745,595 10,985,778 4,567,016 2,904,022 15,394,367 18,298,389
KMART PARCEL 905,674 3,666,386 4,922,621 905,674 8,589,007 9,494,681
KRC ST. CHARLES - 550,204 - - 550,204 550,204
ST. LOUIS,
CHRISTY BLVD. 809,087 4,430,514 892,293 809,087 5,322,807 6,131,894
OVERLAND - 4,928,677 161,877 - 5,090,554 5,090,554
ST. LOUIS - 5,756,736 216,173 - 5,972,909 5,972,909
ST. LOUIS - 2,766,644 43,298 - 2,809,942 2,809,942
ST. PETERS 1,182,194 7,423,459 5,636,695 1,182,194 13,060,154 14,242,348
SPRINGFIELD,
GLENSTONE AVE. - 608,793 1,591,352 - 2,200,145 2,200,145
CHARLOTTE 919,251 3,570,981 1,036,008 919,251 4,606,989 5,526,240
CHARLOTTE 1,783,400 7,139,131 383,767 1,783,400 7,522,898 9,306,298
TYVOLA RD. - 4,736,345 1,912,767 - 6,649,112 6,649,112
CROSSROADS PLAZA 767,864 3,098,881 - 767,864 3,098,881 3,866,744
KIMCO CARY 696, INC. 2,180,000 8,756,865 383,993 2,256,799 9,064,059 11,320,858
HOPE VALLEY FARMS 3,977,412 - 8,396,843 3,579,498 8,794,757 12,374,254
DURHAM 1,882,800 7,551,576 1,130,056 1,882,800 8,681,632 10,564,432
LANDMARK STATION S.C. 1,200,000 4,808,785 120,291 1,200,000 4,929,076 6,129,076
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
GLEN BURNIE VILLAGE 100,300 6,690,981 - 2003(A)
LITTLE GLEN 27,404 1,609,960 - 2003(A)
HAGERSTOWN 1,966,480 1,750,807 - 1973(C)
SHAWAN PLAZA 239,308 26,119,977 14,381,403 2003(A)
NEW RIDGE - 1,318,416 - 2003(A)
LAUREL 605,545 2,081,802 - 1995(A)
LAUREL 923,915 447,813 - 1972(C)
LARGO/LANDOVER 2,792,415 25,430,588 - 1999(A)
LUTHERVILLE STATION 127,110 19,874,030 - 2003(A)
ORCHARD SQUARE
MEDICAL OFFICE 56,713 5,051,645 2,909,374 2003(A)
SOUTHWEST MIXED
USE PROPERTY 67,605 1,660,555 - 2003(A)
NORTH EAST STATION 52,420 8,041,582 - 2003(A)
NEW TOWN VILLAGE 230,482 29,174,695 13,083,020 2003(A)
PERRY HALL 147,354 15,831,729 6,039,755 2003(A)
PERRY HALL
SUPER FRESH 67,513 14,553,749 - 2003(A)
NORTHWOOD
INDUSTRIAL PARK - 1,045,491 - 2003(A)
RADCLIFFE @ TOWSON 223,362 24,114,134 - 2003(A)
TIMONIUM CROSSING 154,581 14,804,888 6,081,662 2003(A)
TIMONIUM
SHOPPING CENTER 463,017 29,819,981 11,154,139 2003(A)
WALDORF BOWL 10,134 954,327 - 2003(A)
WALDORF FIRESTONE 2,874 310,878 - 2003(A)
WAVERLY WOODS 149,257 20,465,852 13,620,453 2003(A)
BANGOR, ME 86,735 2,033,182 - 2001(A)
CLAWSON 2,077,190 8,760,686 - 1993(A)
WHITE LAKE 1,931,680 11,007,784 - 1996(A)
FARMINGTON 1,466,711 6,240,342 - 1993(A)
FLINT 3,482,094 6,169,844 - 2000(A)
LIVONIA 579,337 1,171,131 - 1968(C)
MUSKEGON 1,354,982 808,823 - 1985(A)
LAKE CROSSING - 10,726,812 - 2003(C)
TAYLOR 1,534,811 5,958,138 - 1993(A)
WALKER 3,997,277 16,264,741 - 1993(A)
BRIDGETON 352,088 1,844,746 - 1997(A)
CREVE COEUR,
WOODCREST/OLIVE 818,682 6,204,243 - 1998(A)
CRYSTAL CITY, MI 31,111 203,267 - 1997(A)
CAPE GIRARDEAU 347,533 1,894,936 - 1997(A)
HAZELWOOD, MO 32,257 292,001 - 1971(C)
INDEPENDENCE,
NOLAND DR. 1,247,080 9,489,614 - 1998(A)
NORTH POINT
SHOPPING CENTER 1,024,881 8,879,166 7,124,760 1998(A)
KIRKWOOD 1,379,675 15,507,662 - 1998(A)
KANSAS CITY 490,528 3,301,716 - 1997(A)
LEMAY 540,627 334,101 - 1974(C)
GRAVOIS 4,590,679 11,315,496 - 1972(C)
ST. CHARLES-UNDER-
DEVELOPED LAND, MO 54,436 1,136,379 - 1998(A)
SPRINGFIELD 3,049,843 15,248,546 - 1994(A)
KMART PARCEL 258,475 9,236,206 3,163,588 2002(A)
KRC ST. CHARLES 70,539 479,665 - 1998(A)
ST. LOUIS,
CHRISTY BLVD. 584,897 5,546,997 - 1998(A)
OVERLAND 820,862 4,269,692 - 1997(A)
ST. LOUIS 963,559 5,009,350 - 1997(A)
ST. LOUIS 441,541 2,368,401 - 1997(A)
ST. PETERS 1,148,781 13,093,567 - 1997(A)
SPRINGFIELD,
GLENSTONE AVE. 183,599 2,016,546 - 1998(A)
CHARLOTTE 956,447 4,569,793 - 1995(A)
CHARLOTTE 1,916,759 7,389,539 - 1993(A)
TYVOLA RD. 4,367,494 2,281,619 - 1986(A)
CROSSROADS PLAZA 277,838 3,588,906 - 2000(A)
KIMCO CARY 696, INC. 1,295,527 10,025,331 - 1998(A)
HOPE VALLEY FARMS - 12,374,254 7,596,360 2002(C)
DURHAM 1,623,115 8,941,316 - 1996(A)
LANDMARK STATION S.C. 526,580 5,602,496 - 1999(A)
94
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
GASTONIA 2,467,696 9,870,785 1,041,564 2,467,696 10,912,349 13,380,045
HILLSBOROUGH CROSSING 2,750,820 - - 2,750,820 - 2,750,820
RALEIGH 5,208,885 20,885,792 2,124,607 5,208,885 23,010,399 28,219,284
WAKEFIELD COMMONS II 6,506,450 - 891,764 5,998,650 1,399,564 7,398,214
WAKEFIELD CROSSINGS 3,413,932 - (2,353,710) 825,006 235,217 1,060,223
EDGEWATER PLACE 3,150,000 - 6,331,691 3,150,000 6,331,691 9,481,691
WAKEFIELD COMMONS 1,240,000 5,015,595 31,120 1,240,000 5,046,715 6,286,715
SUTTON SQUARE 3,310,690 - 49,396 3,311,940 13,293,656 16,605,596
WINSTON-SALEM 540,667 719,655 4,988,159 540,667 5,707,814 6,248,481
WEBSTER SQUARE 5,885,087 20,351,967 4,094,468 5,885,087 24,446,435 30,331,522
ROCKINGHAM 2,660,915 10,643,660 10,048,902 2,660,915 20,692,562 23,353,477
BRIDGEWATER NJ 1,982,481 (3,666,959) 3,443,995 1,982,481 5,200,423 7,182,904
CHERRY HILL 2,417,583 6,364,094 1,057,869 2,417,583 7,421,963 9,839,546
MARLTON PIKE - 4,318,534 - - 4,318,534 4,318,534
CINNAMINSON 652,123 2,608,491 1,381,927 652,123 3,990,418 4,642,541
FRANKLIN TOWNE
CENTER 4,903,113 19,608,193 76,632 4,903,113 19,684,825 24,587,938
HILLSBOROUGH 11,886,809 - (6,880,755) 5,006,054 - 5,006,054
HOLMDEL TOWNE
CENTER 10,824,624 43,301,494 190,857 10,824,624 43,492,351 54,316,975
STRAUSS DISCOUNT
AUTO 1,225,294 91,203 1,418,208 1,228,794 1,505,911 2,734,705
NORTH BRUNSWICK 3,204,978 12,819,912 12,855,289 3,204,978 25,675,201 28,880,179
PISCATAWAY TOWN
CENTER 3,851,839 15,410,851 108,895 3,851,839 15,519,746 19,371,585
RIDGEWOOD 450,000 2,106,566 982,954 450,000 3,089,520 3,539,520
WESTMONT 601,655 2,404,604 9,687,180 601,655 12,091,784 12,693,439
SYCAMORE PLAZA 1,404,443 5,613,270 56,400 1,404,443 5,669,670 7,074,113
PLAZA PASEO
DEL-NORTE 4,653,197 18,633,584 373,675 4,653,197 19,007,259 23,660,456
JUAN TABO,
ALBUQUERQUE 1,141,200 4,566,817 296,800 1,141,200 4,863,617 6,004,817
COLONIE PLAZA 1,794,122 5,896,341 - 1,794,122 5,896,341 7,690,463
BRIDGEHAMPTON 1,811,752 3,107,232 22,498,471 1,811,752 25,605,703 27,417,455
TWO GUYS
AUTO GLASS 105,497 436,714 - 105,497 436,714 542,211
GENOVESE
DRUG STORE 564,097 2,268,768 - 564,097 2,268,768 2,832,865
KING KULLEN PLAZA 5,968,082 23,243,404 737,288 5,968,082 23,980,692 29,948,774
HAMPTON BAYS 1,495,105 5,979,320 113,495 1,495,105 6,092,815 7,587,920
HENRIETTA 1,075,358 6,635,486 1,597,189 1,075,358 8,232,675 9,308,033
IRONDEQUOIT 213,617 546,101 1,004,064 213,617 1,550,165 1,763,782
DOUGLASTON
SHOPPING CENTER 3,033,190 12,179,993 - 3,033,190 12,179,993 15,213,183
ROSLYN SAVINGS BANK 244,064 981,225 - 244,064 981,225 1,225,289
MANHASSET VENTURE LLC 4,567,003 19,165,808 11,701,020 4,567,003 30,866,828 35,433,831
NANUET 798,932 2,361,900 2,786,008 798,932 5,147,908 5,946,840
AMERICAN MUFFLER SHOP 76,056 325,567 - 76,056 325,567 401,624
PLAINVIEW 263,693 584,031 9,644,772 263,693 10,228,803 10,492,496
POUGHKEEPSIE 876,548 4,695,659 12,592,263 876,548 17,287,922 18,164,470
COLUMBIA PLAZA 2,800,041 9,202,247 - 2,800,041 9,202,247 12,002,288
SYOSSET, NY 106,655 76,197 673,299 - 749,496 749,496
STATEN ISLAND 2,280,000 9,027,951 4,854,148 2,280,000 13,882,099 16,162,099
STATEN ISLAND 2,940,000 11,811,964 586,017 2,940,000 12,397,981 15,337,981
WEST GATES 1,784,718 9,721,970 (2,043,308) 1,784,718 7,678,662 9,463,380
YONKERS 871,977 3,487,909 - 871,977 3,487,909 4,359,886
AKRON WATERLOO 437,277 1,912,222 4,113,885 437,277 6,026,107 6,463,384
WEST MARKET ST. 560,255 3,909,430 210,155 560,255 4,119,585 4,679,840
ROMIG ROAD 855,713 5,472,635 7,781 855,713 5,480,416 6,336,129
AKRON, OH - 2,491,079 64,934 - 2,556,013 2,556,013
BARBERTON 505,590 1,948,135 1,511,962 505,590 3,460,097 3,965,687
BRUNSWICK 771,765 6,058,560 632,524 771,765 6,691,084 7,462,849
BEAVERCREEK 635,228 3,024,722 2,800,398 635,228 5,825,120 6,460,348
MEMPHIS AVE 696,495 4,048,722 - 696,495 4,048,722 4,745,218
CANTON HILLS 500,980 2,020,274 1,199,309 500,980 3,219,583 3,720,563
CANTON 792,985 1,459,031 4,482,484 792,985 5,941,515 6,734,500
CAMBRIDGE - 1,848,195 885,408 473,060 2,260,543 2,733,603
MORSE RD. 835,386 2,097,600 2,725,135 835,386 4,822,735 5,658,121
HAMILTON RD. 856,178 2,195,520 3,756,686 856,178 5,952,206 6,808,384
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
GASTONIA 3,909,439 9,470,606 - 1989(A)
HILLSBOROUGH CROSSING - 2,750,820 - 2003(A)
RALEIGH 5,242,129 22,977,155 - 1993(A)
WAKEFIELD COMMONS II - 7,398,214 5,392,976 2001(C)
WAKEFIELD CROSSINGS - 1,060,223 - 2001(C)
EDGEWATER PLACE - 9,481,691 4,417,984 2003(C)
WAKEFIELD COMMONS 343,486 5,943,229 - 2001(C)
SUTTON SQUARE 351,024 16,254,572 - 2003(A)
WINSTON-SALEM 1,868,805 4,379,676 - 1969(C)
WEBSTER SQUARE 1,029,110 29,302,412 - 2003(A)
ROCKINGHAM 3,970,657 19,382,820 - 1994(A)
BRIDGEWATER NJ 1,107,813 6,075,092 - 1998(C)
CHERRY HILL 3,918,872 5,920,673 6,425,000 1985(C)
MARLTON PIKE 812,032 3,506,502 - 1996(A)
CINNAMINSON 447,748 4,194,792 - 1996(A)
FRANKLIN TOWNE
CENTER 2,772,406 21,815,532 12,024,220 1998(A)
HILLSBOROUGH - 5,006,054 - 2001(C)
HOLMDEL TOWNE
CENTER 1,112,667 53,204,308 - 2002(A)
STRAUSS DISCOUNT
AUTO 6,366 2,728,339 - 2002(A)
NORTH BRUNSWICK 5,032,590 23,847,589 - 1994(A)
PISCATAWAY TOWN
CENTER 2,183,170 17,188,415 - 1998(A)
RIDGEWOOD 581,194 2,958,327 - 1993(A)
WESTMONT 1,879,439 10,813,999 - 1994(A)
SYCAMORE PLAZA 796,099 6,278,014 1,676,015 1998(A)
PLAZA PASEO
DEL-NORTE 2,645,310 21,015,146 - 1998(A)
JUAN TABO,
ALBUQUERQUE 648,117 5,356,701 - 1998(A)
COLONIE PLAZA 68,932 7,621,531 - 2003(A)
BRIDGEHAMPTON 8,561,043 18,856,412 - 1972(C)
TWO GUYS
AUTO GLASS 8,297 533,913 - 2003(A)
GENOVESE
DRUG STORE 43,544 2,789,321 - 2003(A)
KING KULLEN PLAZA 3,899,965 26,048,809 - 1998(A)
HAMPTON BAYS 2,709,758 4,878,163 - 1989(A)
HENRIETTA 2,158,195 7,149,837 - 1993(A)
IRONDEQUOIT 495,468 1,268,314 - 1993(A)
DOUGLASTON
SHOPPING CENTER 234,095 14,979,087 - 2003(A)
ROSLYN SAVINGS BANK 18,840 1,206,449 - 2003(A)
MANHASSET VENTURE LLC 2,026,091 33,407,741 - 1999(A)
NANUET 2,059,485 3,887,355 - 1984(A)
AMERICAN MUFFLER SHOP 6,117 395,506 - 2003(A)
PLAINVIEW 3,047,131 7,445,366 - 1969(C)
POUGHKEEPSIE 5,101,831 13,062,639 - 1972(C)
COLUMBIA PLAZA 68,103 11,934,185 - 2003(A)
SYOSSET, NY 112,302 637,194 - 1990(C)
STATEN ISLAND 5,194,146 10,967,952 - 1989(A)
STATEN ISLAND 1,868,579 13,469,402 3,076,898 1997(A)
WEST GATES 2,549,291 6,914,089 - 1993(A)
YONKERS 750,866 3,609,020 - 1998(A)
AKRON WATERLOO 1,980,637 4,482,747 - 1975(C)
WEST MARKET ST. 1,896,135 2,783,705 - 1999(A)
ROMIG ROAD 2,399,877 3,936,252 - 1999(A)
AKRON, OH 913,241 1,642,773 - 1999(A)
BARBERTON 1,904,346 2,061,341 - 1972(C)
BRUNSWICK 5,529,418 1,933,431 - 1975(C)
BEAVERCREEK 3,618,189 2,842,159 - 1986(A)
MEMPHIS AVE 1,861,420 2,883,797 - 1999(A)
CANTON HILLS 659,205 3,061,358 - 1993(A)
CANTON 3,037,025 3,697,474 - 1972(C)
CAMBRIDGE 1,683,315 1,050,288 - 1973(C)
MORSE RD. 2,060,944 3,597,177 - 1988(A)
HAMILTON RD. 2,391,337 4,417,047 - 1988(A)
95
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
OLENTANGY RIVER RD. 764,517 1,833,600 2,258,091 764,517 4,091,691 4,856,208
W. BROAD ST. 982,464 3,929,856 3,117,677 969,804 7,060,193 8,029,997
RIDGE ROAD 1,285,213 4,712,358 9,318,089 1,285,213 14,030,447 15,315,660
GLENWAY AVE 530,243 3,788,189 527,010 530,243 4,315,198 4,845,441
SPRINGDALE 3,205,653 14,619,732 5,358,223 3,205,653 19,977,955 23,183,608
EVERHARD RD 633,046 3,729,612 - 633,046 3,729,612 4,362,658
SOUTH HIGH ST. 602,421 2,737,004 22,343 602,421 2,759,347 3,361,768
GLENWAY CROSSING 699,359 3,112,047 849,796 699,359 3,961,843 4,661,202
HIGHLAND RIDGE PLAZA 1,540,000 6,178,398 141,991 1,540,000 6,320,389 7,860,389
SHILOH SPRING RD. - 1,735,836 1,937,453 - 3,673,289 3,673,289
OAKCREEK 1,245,870 4,339,637 4,047,657 1,245,870 8,387,294 9,633,164
SALEM AVE. 665,314 347,818 5,413,585 665,314 5,761,403 6,426,717
KETTERING 1,190,496 4,761,984 671,539 1,190,496 5,433,523 6,624,019
KENT, OH 6,254 3,028,914 - 6,254 3,028,914 3,035,168
KENT 2,261,530 - - 2,261,530 - 2,261,530
LIMA 695,121 3,080,479 795,668 695,121 3,876,147 4,571,268
MENTOR 503,981 2,455,926 1,189,489 503,981 3,645,415 4,149,396
MIDDLEBURG HEIGHTS 639,542 3,783,096 1,761,840 639,542 5,544,935 6,184,477
MENTOR ERIE COMMONS 2,234,474 9,648,000 4,612,982 2,234,474 14,260,982 16,495,456
MALLWOODS CENTER 294,232 - (496,786) 294,232 1,184,543 1,478,775
NORTH OLMSTED 626,818 3,712,045 35,000 626,818 3,747,045 4,373,862
ORANGE OHIO 4,800,143 - 2,308,415 3,771,137 3,337,422 7,108,559
SPRINGBORO PIKE 1,854,527 2,572,518 2,686,223 1,854,527 5,258,741 7,113,268
SPRINGFIELD 842,976 3,371,904 1,489,623 842,976 4,861,527 5,704,503
UPPER ARLINGTON 504,256 2,198,476 8,373,633 1,255,544 9,820,821 11,076,365
WICKLIFFE 610,991 2,471,965 1,390,343 610,991 3,862,308 4,473,299
CHARDON ROAD 481,167 5,947,751 50,724 481,167 5,998,474 6,479,642
WESTERVILLE 1,050,431 4,201,616 7,654,134 1,050,431 11,855,750 12,906,181
EDMOND 477,036 3,591,493 8,900 477,036 3,600,393 4,077,429
MIDWEST CITY 1,435,506 7,370,459 (3,397,576) 1,437,930 3,970,459 5,408,389
CENTENNIAL PLAZA 4,650,634 18,604,307 1,107,365 4,650,634 19,711,672 24,362,306
TULSA 500,950 2,002,508 11,500 500,950 2,014,008 2,514,958
TULSA - - 131,399 - 131,399 131,399
CHIPPEWA 2,881,525 11,526,101 91,020 2,881,525 11,617,121 14,498,646
SAUCON VALLEY SQUARE 3,609,206 11,830,713 - 3,609,206 11,830,713 15,439,919
CARNEGIE - 3,298,908 17,747 - 3,316,655 3,316,655
CENTER SQUARE 731,888 2,927,551 523,159 731,888 3,450,710 4,182,598
STONEHEDGE SQUARE 2,797,183 9,167,352 - 2,797,183 9,167,352 11,964,534
WAYNE AVENUE PLAZA 3,758,796 12,336,771 - 3,758,796 12,336,771 16,095,567
WEST MIFFLIN 475,815 1,903,231 724,416 475,815 2,627,647 3,103,462
EAST STROUDSBURG 1,050,000 2,372,628 1,075,684 1,050,000 3,448,312 4,498,312
EXTON 176,666 4,895,360 - 176,666 4,895,360 5,072,026
EXTON 731,888 2,927,551 - 731,888 2,927,551 3,659,439
EASTWICK 889,001 2,762,888 2,386,166 889,001 5,539,713 6,428,714
FEASTERVILLE 520,521 2,082,083 38,692 520,521 2,120,775 2,641,296
GETTYSBURG 74,626 671,630 101,519 74,626 773,149 847,775
HARRISBURG, PA 452,888 6,665,238 1,674,028 452,888 8,339,266 8,792,154
SIMPSON FERRY 658,346 6,908,711 316,435 658,346 7,225,146 7,883,491
HAMBURG 439,232 - 2,023,428 494,982 1,967,677 2,462,660
HAVERTOWN 731,888 2,927,551 - 731,888 2,927,551 3,659,439
OLMSTED 167,337 2,815,856 444,283 167,337 3,260,139 3,427,476
MIDDLETOWN 207,283 1,174,603 447,331 207,283 1,621,934 1,829,217
HOLIDAY CENTER 5,662,465 18,112,629 - 5,662,465 18,112,629 23,775,094
NORRISTOWN 686,134 2,664,535 3,374,215 774,084 5,950,800 6,724,884
NEW KENSINGTON 521,945 2,548,322 676,040 521,945 3,224,362 3,746,307
PHILADELPHIA 731,888 2,927,551 - 731,888 2,927,551 3,659,439
GALLERY,
PHILADELPHIA PA - - 258,931 - 258,931 258,931
POTTSTOWN PLAZA 3,535,364 11,619,579 - 3,535,364 11,619,579 15,154,944
RICHBORO 788,761 3,155,044 11,736,134 976,439 14,703,500 15,679,939
SPRINGFIELD 919,998 4,981,589 1,612,375 919,998 6,593,964 7,513,962
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
OLENTANGY RIVER RD. 2,146,063 2,710,145 - 1988(A)
W. BROAD ST. 2,787,716 5,242,281 - 1988(A)
RIDGE ROAD 2,155,159 13,160,501 - 1992(A)
GLENWAY AVE 1,880,912 2,964,529 - 1999(A)
SPRINGDALE 6,633,152 16,550,456 - 1992(A)
EVERHARD RD 1,595,288 2,767,370 - 1999(A)
SOUTH HIGH ST. 1,493,287 1,868,481 - 1999(A)
GLENWAY CROSSING 289,878 4,371,324 - 2000(A)
HIGHLAND RIDGE PLAZA 656,991 7,203,398 - 1999(A)
SHILOH SPRING RD. 2,373,754 1,299,535 - 1969(C)
OAKCREEK 4,051,540 5,581,624 - 1984(A)
SALEM AVE. 2,074,603 4,352,114 - 1988(A)
KETTERING 2,442,064 4,181,955 - 1988(A)
KENT, OH 1,089,887 1,945,281 - 1999(A)
KENT - 2,261,530 - 1995(A)
LIMA 822,238 3,749,029 - 1995(A)
MENTOR 1,568,544 2,580,852 - 1987(A)
MIDDLEBURG HEIGHTS 1,666,542 4,517,935 - 1999(A)
MENTOR ERIE COMMONS 4,898,092 11,597,364 - 1988(A)
MALLWOODS CENTER 35,435 1,443,339 - 1999(C)
NORTH OLMSTED 1,594,422 2,779,441 - 1999(A)
ORANGE OHIO - 7,108,559 - 2001(C)
SPRINGBORO PIKE 3,073,795 4,039,473 - 1985(C)
SPRINGFIELD 1,772,656 3,931,847 - 1988(A)
UPPER ARLINGTON 5,054,541 6,021,824 - 1969(C)
WICKLIFFE 756,896 3,716,403 - 1995(A)
CHARDON ROAD 2,100,113 4,379,529 - 1999(A)
WESTERVILLE 3,500,704 9,405,477 - 1988(A)
EDMOND 542,184 3,535,245 - 1997(A)
MIDWEST CITY 939,380 4,469,009 - 1998(A)
CENTENNIAL PLAZA 2,654,501 21,707,805 9,042,814 1998(A)
TULSA 406,948 2,108,010 - 1996(A)
TULSA 18,061 113,338 - 1997(A)
CHIPPEWA 1,166,407 13,332,239 11,691,397 2000(A)
SAUCON VALLEY SQUARE 95,501 15,344,418 9,533,821 2003(A)
CARNEGIE 340,170 2,976,485 - 1999(A)
CENTER SQUARE 550,481 3,632,118 - 1996(A)
STONEHEDGE SQUARE 95,823 11,868,711 6,196,696 2003(A)
WAYNE AVENUE PLAZA 137,129 15,958,438 9,566,627 2003(A)
WEST MIFFLIN 612,031 2,491,431 - 1993(A)
EAST STROUDSBURG 2,311,126 2,187,186 - 1973(C)
EXTON 502,089 4,569,938 - 1999(A)
EXTON 550,481 3,108,958 - 1996(A)
EASTWICK 989,016 5,439,698 4,698,582 1997(A)
FEASTERVILLE 381,935 2,259,361 - 1996(A)
GETTYSBURG 702,827 144,948 - 1986(A)
HARRISBURG, PA 3,910,481 4,881,673 - 2002(A)
SIMPSON FERRY 2,744,171 5,139,321 - 2000(A)
HAMBURG 88,293 2,374,366 2,618,713 2000(C)
HAVERTOWN 550,481 3,108,958 - 1996(A)
OLMSTED 2,540,403 887,073 - 1973(C)
MIDDLETOWN 1,152,161 677,056 - 1986(A)
HOLIDAY CENTER 40,636 23,734,458 - 2003(A)
NORRISTOWN 3,334,199 3,390,685 - 1984(A)
NEW KENSINGTON 2,732,802 1,013,505 - 1986(A)
PHILADELPHIA 550,481 3,108,958 - 1996(A)
GALLERY,
PHILADELPHIA PA 5,923 253,008 - 1996(A)
POTTSTOWN PLAZA 101,600 15,053,344 - 2003(A)
RICHBORO 5,051,493 10,628,446 - 1986(A)
SPRINGFIELD 3,941,615 3,572,347 - 1983(A)
96
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
SHREWSBURY 3,245,475 11,068,862 - 3,245,475 11,068,862 14,314,337
UPPER ALLEN 445,743 1,782,972 173,253 445,743 1,956,225 2,401,968
UPPER DARBY 231,821 927,286 4,813,997 231,821 5,670,033 5,901,854
WEST MIFFLIN HILLS 636,366 3,199,729 7,038,936 636,366 10,238,665 10,875,031
WEST MIFFLIN 1,468,341 - - 1,468,341 - 1,468,341
WHITEHALL - 5,195,577 9,231 - 5,204,808 5,204,808
WAYNE HEIGHTS 786,298 2,584,269 - 786,298 2,584,269 3,370,568
EASTERN BLVD. 412,016 1,876,962 615,039 412,016 2,492,001 2,904,017
E. PROSPECT ST. 604,826 2,755,314 324,031 604,826 3,079,345 3,684,171
W. MARKET ST. 188,562 1,158,307 - 188,562 1,158,307 1,346,869
MARSHALL PLAZA,
CRANSTON RI 1,886,600 7,575,302 408,786 1,886,600 7,984,088 9,870,688
AIKEN 183,901 1,087,979 69,601 183,901 1,157,580 1,341,481
CHARLESTON 730,164 3,132,092 4,651,878 730,164 7,783,970 8,514,134
CHARLESTON 1,744,430 6,986,094 4,130,753 1,744,430 11,116,847 12,861,277
FLORENCE 1,465,661 6,011,013 85,458 1,465,661 6,096,471 7,562,132
GREENVILLE 2,209,812 8,850,864 145,281 2,209,812 8,996,145 11,205,957
NORTH CHARLESTON 744,093 2,974,990 37,915 744,093 3,012,905 3,756,998
N. CHARLESTON 2,965,748 11,895,294 743,004 2,965,748 12,638,298 15,604,046
MADISON - 4,133,904 2,016,634 - 6,150,538 6,150,538
HICKORY RIDGE
COMMONS 596,347 2,545,033 7,624 596,347 2,552,656 3,149,004
TROLLEY STATION 3,303,682 13,218,740 55,985 3,303,682 13,274,725 16,578,407
MARKET PLACE
AT RIVERGATE 2,574,635 10,339,449 614,173 2,574,635 10,953,622 13,528,257
RIVERGATE, TN 3,038,561 12,157,408 2,772,124 3,038,561 14,929,532 17,968,093
CENTER OF THE
HILLS, TX 2,923,585 11,706,145 304,976 2,923,585 12,011,121 14,934,706
ARLINGTON 3,160,203 2,285,377 - 3,160,203 2,285,377 5,445,580
DOWLEN CENTER 2,244,581 - 6,711,140 2,244,581 6,711,140 8,955,721
BURLESON 10,191,584 810,314 (3,147,550) 4,837,454 3,016,895 7,854,349
BAYTOWN 500,422 2,431,651 208,430 500,422 2,640,081 3,140,503
SOUTH TOWN PLAZA 5,553,000 - - 3,709,462 1,694,560 5,404,022
CORPUS CHRISTI, TX - 944,562 3,207,999 - 4,152,561 4,152,561
DALLAS 1,299,632 5,168,727 4,652,572 1,299,632 9,821,299 11,120,931
DUNCANVILLE 500,414 2,001,656 - 500,414 2,001,656 2,502,070
MONTGOMERY PLAZA 8,500,000 - - 8,500,000 1,005,268 9,505,268
GARLAND 210,286 845,845 - 210,286 845,845 1,056,131
GARLAND 500,414 2,001,656 - 500,414 2,001,656 2,502,070
SPRING CYPRESS, TX 2,261,557 - 7,646,795 2,261,557 7,646,795 9,908,352
CENTER AT BAYBROOK 6,941,017 27,727,491 60,255 6,941,017 27,787,746 34,728,763
HARRIS COUNTY 1,843,000 7,372,420 885,401 2,003,260 8,097,561 10,100,821
SHARPSTOWN COURT 1,560,010 6,245,807 214,917 1,560,010 6,460,724 8,020,734
CYPRESS TOWNE CENTER 6,033,932 - (1,465,857) 4,091,774 476,301 4,568,075
SHOPS AT VISTA RIDGE 3,257,199 13,029,416 75,901 3,257,199 13,105,317 16,362,516
VISTA RIDGE PLAZA 2,926,495 11,716,483 1,610,381 2,926,495 13,326,864 16,253,359
VISTA RIDGE PHASE II 2,276,575 9,106,300 18,600 2,276,575 9,124,900 11,401,475
SOUTH PLAINES
PLAZA, TX 1,890,000 7,577,145 83,854 1,890,000 7,661,000 9,551,000
LAKE WORTH
TOWNE CROSSING 11,750,000 - - 10,362,265 287,201 10,649,466
MESQUITE 520,340 2,081,356 724,043 520,340 2,805,399 3,325,739
MESQUITE TOWN CENTER 3,757,324 15,061,644 1,018,941 3,757,324 16,080,585 19,837,909
N. RICHLAND HILLS 1,000,000 - 80,837 1,065,837 15,000 1,080,837
NEW BRAUNSFELS 840,000 3,360,000 - 840,000 3,360,000 4,200,000
FORUM AT OLYMPIA
PARKWAY 1,829,102 - 11,026,910 1,512,390 18,167,893 19,680,283
PLANO 500,414 2,830,835 - 500,414 2,830,835 3,331,249
WEST OAKS 500,422 2,001,687 26,291 500,422 2,027,978 2,528,400
MARKET STREET
AT WOODLANDS 10,920,168 - 19,004,874 10,920,168 19,004,874 29,925,042
OGDEN 213,818 855,275 3,186,956 874,898 4,042,231 4,917,129
BURKE TOWN PLAZA 3,547,274 11,658,112 - 3,547,274 11,658,112 15,205,386
COLONIAL HEIGHTS 125,376 3,476,073 10,220 125,376 3,486,293 3,611,669
SPOTSYLVANIA
CROSSING 3,116,847 9,267,319 - 3,116,847 9,267,319 12,384,166
HARRISONBURG 69,885 1,938,239 - 69,885 1,938,239 2,008,123
SKYLINE VILLAGE 2,319,115 8,203,325 - 2,319,115 8,203,325 10,522,440
MANASSAS 1,788,750 7,162,661 171,273 1,788,750 7,333,934 9,122,684
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
SHREWSBURY 61,109 14,253,229 - 2003(A)
UPPER ALLEN 1,703,316 698,652 - 1986(A)
UPPER DARBY 879,477 5,022,377 3,691,743 1996(A)
WEST MIFFLIN HILLS 5,120,836 5,754,194 - 1973(C)
WEST MIFFLIN - 1,468,341 - 1986(A)
WHITEHALL 976,947 4,227,861 - 1996(A)
WAYNE HEIGHTS 20,600 3,349,967 - 2003(A)
EASTERN BLVD. 1,786,294 1,117,723 - 1987(A)
E. PROSPECT ST. 2,649,001 1,035,169 - 1986(A)
W. MARKET ST. 1,071,917 274,952 - 1986(A)
MARSHALL PLAZA,
CRANSTON RI 1,153,707 8,716,982 - 1998(A)
AIKEN 515,547 825,934 - 1989(A)
CHARLESTON 2,461,485 6,052,649 - 1978(C)
CHARLESTON 1,883,105 10,978,171 - 1995(A)
FLORENCE 971,912 6,590,220 - 1997(A)
GREENVILLE 1,358,210 9,847,747 - 1997(A)
NORTH CHARLESTON 263,471 3,493,527 2,049,497 2000(A)
N. CHARLESTON 1,717,240 13,886,805 - 1997(A)
MADISON 3,873,160 2,277,377 - 1978(C)
HICKORY RIDGE
COMMONS 226,806 2,922,198 - 2000(A)
TROLLEY STATION 1,782,321 14,796,087 10,796,971 1998(A)
MARKET PLACE
AT RIVERGATE 1,466,819 12,061,438 - 1998(A)
RIVERGATE, TN 1,761,629 16,206,464 - 1998(A)
CENTER OF THE
HILLS, TX 1,646,210 13,288,496 - 1998(A)
ARLINGTON 360,075 5,085,505 - 1997(A)
DOWLEN CENTER - 8,955,721 6,093,549 2002(C)
BURLESON - 7,854,349 - 2000(C)
BAYTOWN 477,784 2,662,719 - 1996(A)
SOUTH TOWN PLAZA - 5,404,022 - 2003(C)
CORPUS CHRISTI, TX 254,254 3,898,308 - 1997(A)
DALLAS 8,594,085 2,526,846 - 1969(C)
DUNCANVILLE 406,317 2,095,753 - 1996(A)
MONTGOMERY PLAZA - 9,505,268 - 2003(C)
GARLAND 165,998 890,133 - 1996(A)
GARLAND 406,317 2,095,753 - 1996(A)
SPRING CYPRESS, TX - 9,908,352 - 2001(C)
CENTER AT BAYBROOK 3,894,729 30,834,034 - 1998(A)
HARRIS COUNTY 1,280,962 8,819,859 - 1997(A)
SHARPSTOWN COURT 792,012 7,228,722 5,762,074 1999(A)
CYPRESS TOWNE CENTER - 4,568,075 - 2003(C)
SHOPS AT VISTA RIDGE 1,847,412 14,515,104 17,904,103 1998(A)
VISTA RIDGE PLAZA 1,717,034 14,536,325 - 1998(A)
VISTA RIDGE PHASE II 1,206,049 10,195,426 - 1998(A)
SOUTH PLAINES
PLAZA, TX 1,125,415 8,425,585 5,251,279 1998(A)
LAKE WORTH
TOWNE CROSSING - 10,649,466 - 2003(C)
MESQUITE 561,156 2,764,583 - 1995(A)
MESQUITE TOWN CENTER 2,152,695 17,685,215 - 1998(A)
N. RICHLAND HILLS - 1,080,837 - 1997(A)
NEW BRAUNSFELS 43,077 4,156,923 - 2003(A)
FORUM AT OLYMPIA
PARKWAY 494 19,679,789 - 1999(C)
PLANO 520,602 2,810,647 - 1996(A)
WEST OAKS 406,431 2,121,969 - 1996(A)
MARKET STREET
AT WOODLANDS - 29,925,042 2,797,014 2002(C)
OGDEN 1,072,041 3,845,087 - 1967(C)
BURKE TOWN PLAZA 96,305 15,109,081 - 2003(A)
COLONIAL HEIGHTS 358,281 3,253,389 - 1999(A)
SPOTSYLVANIA
CROSSING 106,828 12,277,338 - 2003(A)
HARRISONBURG 198,794 1,809,329 - 1999(A)
SKYLINE VILLAGE 146,084 10,376,356 4,100,084 2003(A)
MANASSAS 1,162,515 7,960,169 - 1997(A)
97
INITIAL COST
BUILDING AND SUBSEQUENT BUILDINGS AND
PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS TOTAL
---------- ---- ----------- -------------- ----------- ------------ -----
SUDLEY TOWNE PLAZA 2,065,432 6,781,763 - 2,065,432 6,781,763 8,847,196
RICHMOND 82,544 2,289,288 280,600 82,544 2,569,889 2,652,432
RICHMOND 670,500 2,751,375 - 670,500 2,751,375 3,421,875
SMOKETOWN PLAZA 7,300,000 14,336,886 - 7,300,000 14,336,886 21,636,886
TRIANGLE MALL 9,203,517 7,376,483 (5,887,084) 5,513,791 5,179,125 10,692,916
HAZEL DELL
TOWNE CENTER 9,340,819 - 3,604,337 9,340,819 3,604,337 12,945,156
RACINE 1,403,082 5,612,330 1,568,880 1,403,082 7,181,210 8,584,292
CHARLES TOWN 602,000 3,725,871 10,476,410 602,000 14,202,281 14,804,281
MARTINSBURG 242,634 1,273,828 628,937 242,634 1,902,765 2,145,399
RIVERWALK PLAZA 2,708,290 10,841,674 122,749 2,708,290 10,964,423 13,672,713
JUAREZ RETAIL CENTER 1,938,422 7,919,548 101,038 1,938,422 8,020,587 9,959,009
BALANCE OF PORTFOLIO 205,631 4,492,127 29,272,596 3,630,773 35,085,396 38,716,169
----------------------------------------------
$785,934,642 $3,350,589,251 $4,136,523,893
==============================================
TOTAL COST, DATE OF
ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C)
PROPERTIES DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A)
---------- ------------ ------------ ------------- --------------
SUDLEY TOWNE PLAZA 51,410 8,795,785 - 2003(A)
RICHMOND 87,860 2,564,573 - 1999(A)
RICHMOND 422,487 2,999,388 - 1995(A)
SMOKETOWN PLAZA 133,701 21,503,185 - 2003(A)
TRIANGLE MALL - 10,692,916 12,158,466 2003(C)
HAZEL DELL
TOWNE CENTER - 12,945,156 - 2003(C)
RACINE 2,938,940 5,645,352 - 1988(A)
CHARLES TOWN 5,632,295 9,171,986 - 1985(A)
MARTINSBURG 1,539,173 606,226 - 1986(A)
RIVERWALK PLAZA 1,362,430 12,310,283 7,792,961 1999(A)
JUAREZ RETAIL CENTER - 9,959,009 - 2003(A)
BALANCE OF PORTFOLIO 13,469,785 25,246,384 - VARIOUS
---------------------------------------------------------------
$568,015,445 $ 3,568,508,448 $ 468,697,788
===============================================================
Depreciation and amortization are provided on the straight-line method over the
estimated useful lives of the assets as follows:
Buildings....................................................15 to 46 years
Fixtures, building and leasehold improvements.................Terms of leases or useful lives, whichever is shorter
(including certain identified intangible assets)
The aggregate cost for Federal income tax purposes was approximately $ 4.0
billion at December 31, 2003.
The changes in total real estate assets for the years ended December 31, 2003,
2002 and 2001 are as follows:
-----------------------------------------------------
2003 2002 2001
-----------------------------------------------------
Balance, beginning of period ....................... $ 3,421,159,067 $ 3,201,363,929 $ 3,111,707,470
Acquisitions ..................................... 1,103,993,301 287,379,293 61,622,301
Improvements ..................................... 182,351,801 154,638,211 134,094,630
Transfers from (to) unconsolidated joint ventures. (237,421,088) 22,603,592 (38,139,367)
Sales ............................................ (312,228,077) (200,957,621) (60,388,331)
Assets held for sale ............................. (17,315,557) (10,837,674) --
Adjustment of property carrying values ........... (4,015,554) (33,030,663) --
Adjustment for fully depreciated assets .......... -- -- (7,532,774)
-----------------------------------------------------
Balance, end of period ............................. $ 4,136,523,893 $ 3,421,159,067 $ 3,201,363,929
=====================================================
The changes in accumulated depreciation for the years ended December 31, 2003,
2002, and 2001 are as follows:
-----------------------------------------------
2003 2002 2001
-----------------------------------------------
Balance, beginning of period ..................... $ 516,558,123 $ 452,877,433 $ 391,945,913
Charged to accumulated depreciation .............. -- -- 3,445,686
Depreciation for year .......................... 82,590,580 72,791,420 69,901,342
Transfers from (to) unconsolidated joint ventures (4,124,181) 3,575,220 (1,810,541)
Sales .......................................... (24,979,281) (9,771,567) (3,072,193)
Assets held for sale ........................... (2,029,796) (2,914,382.25) --
Adjustment for fully depreciated assets ........ -- -- (7,532,774)
-----------------------------------------------
Balance, end of period ........................... $ 568,015,445 $ 516,558,123 $ 452,877,433
===============================================
98