Forest City Enterprises (FCEPP) 8-K Results of Operations and Financial Condition

Exhibit 99.1

Forest City Enterprises, Inc.

Supplemental Package

Three and Nine Months Ended October 31, 2005 and 2004

Forest City Enterprises, Inc. and Subsidiaries

Three and Nine Months Ended October 31, 2005 and 2004
Supplemental Package

NYSE: FCEA, FCEB

Index

Corporate Overview	2-3
Supplemental Operating Information
Occupancy Data	4
Comparable Net Operating Income (NOI)	5
Comparable NOI Detail	6-7
Reconciliation of NOI to Net Earnings	8-9
Lease Expirations Schedules	10-11
Schedules of Significant Tenants	12-13
Development Pipeline	14-16
Supplemental Financial Information
Mortgage Financings	17
Scheduled Maturities Table	18-19
Consolidated Balance Sheet Information	20-21
Consolidated Earnings Information	22-25
Investment in and Advances to Affiliates	26-27
Results of Operations Summary	27-30
Reconciliation of Net Earnings to EBDT	31-32
Summary of EBDT	33-46

This Supplemental Package, together with other statements and information publicly disseminated by the Company, contains 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. Such statements reflect management’s current views with respect to financial results related to future events and are based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial or otherwise, may differ from the results discussed in the forward-looking statements. Risk factors discussed on pages 5-12 of the Company’s Form 10-K for the year ended January 31, 2005 and other factors that might cause differences, some of which could be material, include, but are not limited to, real estate development and investment risks including lack of satisfactory financing, construction and lease-up delays and cost overruns, the effect of economic and market conditions on a nationwide basis as well as regionally in areas where the Company has a geographic concentration of properties, reliance on major tenants, the impact of terrorist acts, the Company’s substantial leverage and the ability to obtain and service debt, guarantees under the Company’s credit facility, the level and volatility of interest rates, continued availability of tax-exempt government financing, the sustainability of substantial operations at the subsidiary level, illiquidity of real estate investments, dependence on rental income from real property, conflicts of interest, financial stability of tenants within the retail industry, which may be impacted by competition and consumer spending, potential liability from syndicated properties, effects of uninsured loss, environmental liabilities, partnership risks, litigation risks, risks associated with an investment in a professional sports franchise, the rate revenue increases versus the rate of expense increases, as well as other risks listed from time to time in the Company’s reports filed with the United States Securities and Exchange Commission. The Company has no obligation to revise or update any forward-looking statements, other than imposed by law, as a result of future events or new information. Readers are cautioned not to place undue reliance on such forward-looking statements.

1

Forest City Enterprises, Inc. and Subsidiaries

Supplemental Operating Information

Corporate Overview

We principally engage in the ownership, development, management and acquisition of commercial and residential real estate throughout the United States. We operate through three strategic business units. The Commercial Group, our largest business unit, owns, develops, acquires and operates regional malls, specialty/urban retail centers, office buildings, hotels and mixed-use projects. The Residential Group owns, develops, acquires and operates residential rental property, including upscale and middle-market apartments, adaptive re-use developments and supported-living communities. New York City operations through our partnership with Forest City Ratner Companies are part of the Commercial Group or Residential Group depending on the nature of the operations. Real Estate Groups are the combined Commercial and Residential Groups. The Land Development Group acquires and sells both land and developed lots to residential, commercial and industrial customers. It also owns and develops land into master-planned communities and mixed-use projects. The Nets, a franchise of the National Basketball Association (“NBA”) in which we are an equity investor, is a reportable segment of the Company.

We have approximately $7.8 billion of assets in 25 states and the District of Columbia at October 31, 2005. Our core markets include New York City/Philadelphia metropolitan area, Denver, Boston, Greater Washington D.C./Baltimore metropolitan area and California. As a result of an ongoing effort to increase property concentration in the core markets, these markets now account for 72.5 percent of the cost of our portfolio at October 31, 2005. We have offices in Boston, Chicago, Denver, Los Angeles, New York City, San Francisco, Washington, D.C. and our corporate headquarters are in Cleveland, Ohio.

SUPPLEMENTAL FINANCIAL AND OPERATING INFORMATION

This supplemental package contains certain measures prepared in accordance with the generally accepted accounting principles (“GAAP”) under the full consolidation accounting method, and certain measures prepared under the pro-rata consolidation method, a non-GAAP measure. Along with net earnings, we use an additional measure, Earnings before Depreciation, Amortization and Deferred Taxes (“EBDT”), to report operating results. EBDT is a non-GAAP measure and may not be directly comparable to similarly-titled measures reported by other companies. The financial measures presented under the pro-rata consolidation method, comparable net operating income (“NOI”) and EBDT, provide supplemental information about our operations. Although these measures are not presented in accordance with GAAP, we believe they are necessary to understand our business and operating results, along with net earnings and other GAAP measures. Our investors can use these non-GAAP measures as supplementary information to evaluate our business. Our non-GAAP measures are not intended to be performance measures that should be regarded as alternatives to or more meaningful than, our GAAP measures.

Consolidation Methods

We present certain financial amounts under the pro-rata consolidation method because we believe this information is useful to investors as this method reflects the manner in which we operate our business. In line with industry practice, we have made a large number of investments in which our economic ownership is less than 100% as a means of procuring opportunities and sharing risk. Under the pro-rata consolidation method, we generally present our investments proportionate to our economic share of ownership. Under GAAP, the full consolidation method is used to report partnership assets and liabilities consolidated at 100% if deemed to be under our control or if we are deemed to be the primary beneficiary of the variable interest entity (“VIE”), even if our ownership is not 100%. We provide reconciliations from the full consolidation method to the pro-rata consolidation method throughout our supplemental package. Please refer to our property listing for the detail of our consolidated and non-consolidated properties in our Form 10-K for the year ended January 31, 2005 on pages 13-24.

EBDT

We believe that EBDT, along with net earnings, provides additional information about our core operations. While property dispositions, acquisitions or other factors can affect net earnings in the short-term, we believe EBDT presents a more consistent view of the overall financial performance of our business from period-to-period. EBDT is used by the chief operating decision maker and management to assess performance and resource allocations by strategic business unit and on a consolidated basis. EBDT is similar to Funds From Operations (“FFO”), a measure of performance used by publicly traded Real Estate Investment Trusts (“REIT”), but may not be directly comparable to similarly titled measures reported by other companies. (See pages 29-32 for additional discussion of EBDT as well as a reconciliation of EBDT to net earnings.)

Supplemental Operating Information

The operating information contained in this document includes: occupancy data, comparable NOI, reconciliation of NOI to net earnings, retail and office lease expirations, significant retail and office tenant listings, and our development pipeline. We believe this information will give interested parties a better understanding and more information about the operating performance of our Company. The term “comparable,” which is used throughout this document, is generally defined as including properties that were open and operated in both the three and nine months ended October 31, 2005 and 2004.

2

Forest City Enterprises, Inc. and Subsidiaries

Supplemental Operating Information

We believe occupancy rates, retail and office lease expirations, base rent, and significant retail and office tenant listings represent meaningful operating statistics about our Company. This information will give interested parties a better understanding and more information about the operating performance of our Company.

Comparable NOI is useful because it measures the performance of the same properties on a period-to-period basis and, along with EBDT (as discussed beginning on pages 29-30), is used to assess operating performance and resource allocation of our strategic business units. While property dispositions, acquisitions or other factors can impact net earnings in the short term, we believe comparable NOI gives a more consistent view of our overall performance from quarter-to-quarter and year-to-year. A reconciliation of net earnings, the most comparable financial measure calculated in accordance with GAAP, to NOI and reconciliation from NOI to comparable NOI are provided on pages 6-9 of this document. A reconciliation of NOI to net earnings for each strategic business unit can be found on pages 33-46.

Corporate Headquarters

Forest City Enterprises, Inc.
Terminal Tower
50 Public Square, Suite 1100
Cleveland, Ohio 44113

Annual Report on Form 10-K

A copy of the Annual Report on Form 10-K for the fiscal year ended January 31, 2005 as filed with the Securities and Exchange Commission can be found on our website or may be obtained without charge upon written request to:

Thomas T. Kmiecik
Assistant Treasurer
tomkmiecik@forestcity.net

Website

www.forestcity.net
The information contained on this website is not incorporated herein by reference and does not constitute a part of this supplemental package.

Investor Relations

Thomas G. Smith
Executive Vice President,
Chief Financial Officer and Secretary

Transfer Agent and Registrar

National City Bank
Stock Transfer Department
P.O. Box 92301
Cleveland, OH 44193-0900
(800) 622-6757
www.shareholder.inquiries@nationalcity.com

Stock Exchange Listing

NYSE: FCEA and FCEB

Dividend Reinvestment and Stock Purchase Plan

The Company offers its stockholders the opportunity to purchase additional shares of common stock through the Forest City Enterprises, Inc. Dividend Reinvestment and Stock Purchase Plan (the “Plan”) at 97% of current market value. A copy of the Plan prospectus and an enrollment card may be obtained by contacting National City Bank at (800) 622-6757.

3

Forest City Enterprises, Inc. and Subsidiaries

Supplemental Operating Information

Occupancy Data
October 31, 2005 and 2004

We analyze our occupancy percentages by each of our major product lines as follows:

										Average
	Occupancy			Average			Occupancy			Occupancy
	As of			Occupancy			As of			Year-to-Date
	October 31,			Year-to-Date			October 31,			October 31,
	2005			October 31, 2005			2004			2004
Retail
Comparable		93.3	%		92.9	%		92.3	%		92.1	%
Total		93.0	%		92.1	%		90.9	%		92.1	%
Office
Comparable		94.2	%		94.4	%		92.5	%		92.3	%
Total		92.6	%		92.7	%		92.5	%		92.1	%
Residential
Comparable		94.3	%		93.1	%		92.4	%		92.6	%
Total		91.8	%		89.8	%		92.2	%		90.0	%
Hotels
Comparable and Total					75.3	%					75.8	%
ADR				$	178.66					$	160.87

Retail and office occupancy as of October 31, 2005 and 2004 is based on square feet leased at the end of the fiscal quarter. Average Occupancy Year-to-Date as of October 31, 2005 and 2004 for retail and office is calculated by dividing the sum of leased square feet at the beginning and end of the period by two. Residential occupancy as of October 31, 2005 and 2004 represents total units occupied divided by total units available. Average residential occupancy year-to-date for 2005 and 2004 is calculated by dividing gross potential rent less vacancy by gross potential rent. Average Daily Rate (“ADR”) is calculated by dividing revenue by the number of rooms sold for the nine months ended October 31, 2005 and 2004.

4

Forest City Enterprises, Inc. and Subsidiaries

Supplemental Operating Information

We use NOI, along with EBDT as discussed on pages 2-3, to assess operating performance. Comparable NOI is defined as NOI from properties opened and operated in both the three and nine months ended October 31, 2005 and 2004. The schedules on pages 6-7 presents comparable NOI for each of our major product lines, as well as each strategic business unit under which those product lines operate. A reconciliation of NOI to the most comparable GAAP measure, net earnings, is presented on pages 8-9. A reconciliation of NOI to net earnings for each strategic business unit can be found on pages 33-46.

Comparable Net Operating Income (NOI) (% change over same period, prior year)

	Three Months Ended October 31,						Nine Months Ended October 31,
	2005						2005
	Full			Pro-Rata			Full			Pro-Rata
	Consolidation			Consolidation			Consolidation			Consolidation
Retail		2.1	%		1.1	%		2.8	%		2.5	%
Office		(4.8	)%		(3.6	)%		(1.0	)%		(0.6	)%
Hotel		34.2	%		20.2	%		27.5	%		16.2	%
Residential		3.8	%		4.2	%		3.0	%		3.6	%
Total		2.6	%		1.7	%		3.0	%		2.5	%

5

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

	Net Operating Income(dollars in thousands)
	Three Months Ended October 31, 2005														Three Months Ended October 31, 2004														% Change
						Plus														Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata			Full			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation			Consolidation			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)			(GAAP)			(Non-GAAP)
Commercial Group
Retail
Comparable	$	37,411		$	4,410	$	2,966		$	—		$	35,967		$	36,644		$	3,952	$	2,872		$	—		$	35,564			2.1	%		1.1	%
Total		45,276			4,196		2,966			—			44,046			39,194			2,423		3,204			(13	)		39,962
Office Buildings
Comparable		38,934			4,820		1,013			—			35,127			40,897			5,581		1,109			—			36,425			(4.8	)%		(3.6	)%
Total		40,311			4,620		778			—			36,469			40,402			5,742		1,158			380			36,198
Hotels
Comparable		12,424			3,447		445			—			9,422			9,261			2,039		615			—			7,837			34.2	%		20.2	%
Total		12,424			763		445			—			12,106			9,261			49		615			—			9,827
Earnings from Commercial Land Sales		6,395			227		—			—			6,168			143			—		—			—			143
Development Fees		1,052			421		—			—			631			1,453			581		—			—			872
Other		(382	)		1,981		229			—			(2,134	)		(934	)		136		(58	)		—			(1,128	)
Total Commercial Group
Comparable		88,769			12,677		4,424			—			80,516			86,802			11,572		4,596			—			79,826			2.3	%		0.9	%
Total		105,076			12,208		4,418			—			97,286			89,519			8,931		4,919			367			85,874
Residential Group
Apartments
Comparable		22,966			872		6,517			—			28,611			22,132			927		6,265			—			27,470			3.8	%		4.2	%
Total		25,466			1,315		7,397			(9	)		31,539			25,160			1,159		7,590			2,079			33,670
Total Real Estate Groups
Comparable		111,735			13,549		10,941			—			109,127			108,934			12,499		10,861			—			107,296			2.6	%		1.7	%
Total		130,542			13,523		11,815			(9	)		128,825			114,679			10,090		12,509			2,446			119,544
Land Development Group		22,323			961		(48	)		—			21,314			40,800			3,262		278			—			37,816
The Nets		(3,781	)		—		516			—			(3,265	)		(1,630	)		—		156			—			(1,474	)
Corporate Activities		(9,420	)		—		—			—			(9,420	)		(9,351	)		—		—			—			(9,351	)
Grand Total	$	139,664		$	14,484	$	12,283		$	(9	)	$	137,454		$	144,498		$	13,352	$	12,943		$	2,446		$	146,535

6

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

	Net Operating Income(dollars in thousands)
	Nine Months Ended October 31, 2005												Nine Months Ended October 31, 2004												% Change
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			(Non-GAAP)
Commercial Group
Retail
Comparable	$	114,349		$	13,583	$	8,812	$	—	$	109,578		$	111,194		$	13,048	$	8,776	$	—	$	106,922			2.8	%		2.5	%
Total		134,954			13,171		8,944		—		130,727			116,352			11,914		9,840		1,263		115,541
Office Buildings
Comparable		120,756			15,675		3,078		—		108,159			121,950			16,364		3,269		—		108,855			(1.0	)%		(0.6	)%
Total		128,131			16,600		2,792		—		114,323			119,739			17,513		3,236		2,227		107,689
Hotels
Comparable		26,840			7,177		1,432		—		21,095			21,045			4,748		1,862		—		18,159			27.5	%		16.2	%
Total		26,840			647		1,432		—		27,625			21,045			776		1,862		—		22,131
Earnings from Commercial Land Sales		37,970			2,326		—		—		35,644			491			—		—		—		491
Development Fees		7,714			3,085		—		—		4,629			19,641			7,856		—		—		11,785
Other		(7,929	)		3,526		278		—		(11,177	)		1,287			2,477		476		—		(714	)
Total Commercial Group
Comparable		261,945			36,435		13,322		—		238,832			254,189			34,160		13,907		—		233,936			3.1	%		2.1	%
Total		327,680			39,355		13,446		—		301,771			278,555			40,536		15,414		3,490		256,923
Residential Group
Apartments
Comparable		68,445			2,757		19,420		—		85,108			66,471			2,948		18,597		—		82,120			3.0	%		3.6	%
Total		75,947			3,792		23,092		1,627		96,874			74,542			3,444		21,481		6,974		99,553
Total Real Estate Groups
Comparable		330,390			39,192		32,742		—		323,940			320,660			37,108		32,504		—		316,056			3.0	%		2.5	%
Total		403,627			43,147		36,538		1,627		398,645			353,097			43,980		36,895		10,464		356,476
Land Development Group		69,818			3,576		191		—		66,433			74,070			4,974		671		—		69,767
The Nets		(16,997	)		—		1,992		—		(15,005	)		(1,630	)		—		156		—		(1,474	)
Corporate Activities		(25,723	)		—		—		—		(25,723	)		(23,454	)		—		—		—		(23,454	)
Grand Total	$	430,725		$	46,723	$	38,721	$	1,627	$	424,350		$	402,083		$	48,954	$	37,722	$	10,464	$	401,315

7

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Reconciliation of Net Operating Income (non-GAAP) to Net Earnings (GAAP)(in thousands):

	Three Months Ended October 31, 2005															Three Months Ended October 31, 2004
							Plus															Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata			Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation			Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	291,236		$	29,840		$	81,644		$	165		$	343,205		$	250,317		$	27,939		$	67,448		$	5,397		$	295,223
Exclude straight-line rent adjustment(1)		(3,245	)		—			—			—			(3,245	)		(4,915	)		—			—			(202	)		(5,117	)
Adjusted revenues		287,991			29,840			81,644			165			339,960			245,402			27,939			67,448			5,195			290,106
Operating expenses		175,354			15,892			49,633			274			209,369			148,693			17,127			39,402			2,807			173,775
Add back depreciation and amortization for non-Real Estate Groups(b)		198			—			597			—			795			288			—			37			—			325
Add back amortization of mortgage procurement costs for non-Real Estate Groups(d)		84			—			385			—			469			41			—			148			—			189
Exclude straight-line rent adjustment(2)		(2,045	)		—			—			—			(2,045	)		(1,942	)		—			—			9			(1,933	)
Adjusted operating expenses		173,591			15,892			50,615			274			208,588			147,080			17,127			39,587			2,816			172,356
Add interest income		5,080			536			58			100			4,702			28,907			2,536			156			67			26,594
Add equity in earnings of unconsolidated entities		16,113			—			(14,733	)		—			1,380			10,777			4			(8,582	)		—			2,191
Remove gain on disposition recorded on equity method		(2,526	)		—			2,526			—			—			—			—			—			—			—
Add back equity method depreciation and amortization expense (see below)		6,597			—			(6,597	)		—			—			6,492			—			(6,492	)		—			—
Net Operating Income		139,664			14,484			12,283			(9	)		137,454			144,498			13,352			12,943			2,446			146,535
Interest expense, including early extinguishment of debt		(70,270	)		(7,767	)		(12,283	)		(1,165	)		(75,951	)		(67,759	)		(6,422	)		(12,943	)		(1,862	)		(76,142	)
Gain on disposition of equity method rental properties(e)		2,526			—			—			—			2,526			—			—			—			—			—
Gain on disposition of rental properties and other investments		—			—			—			9,476			9,476			—			—			—			31,397			31,397
Provision for decline in real estate		(3,480	)		(1,360	)		—			—			(2,120	)		—			—			—			—			—
Depreciation and amortization — Real Estate Groups(a)		(43,810	)		(3,828	)		(6,294	)		—			(46,276	)		(36,902	)		(2,582	)		(6,211	)		(1,164	)		(41,695	)
Amortization of mortgage procurement costs — Real Estate Groups(c)		(3,480	)		(757	)		(303	)		—			(3,026	)		(3,723	)		(671	)		(281	)		(39	)		(3,372	)
Straight-line rent adjustment(1) + (2)		1,200			—			—			—			1,200			2,973			—			—			211			3,184
Equity method depreciation and amortization expense (see above)		(6,597	)		—			6,597			—			—			(6,492	)		—			6,492			—			—
Earnings before income taxes		15,753			772			—			8,302			23,283			32,595			3,677			—			30,989			59,907
Income tax provision		(7,171	)		—			—			(3,208	)		(10,379	)		(11,737	)		—			—			(12,239	)		(23,976	)
Earnings before minority interest and discontinued operations		8,582			772			—			5,094			12,904			20,858			3,677			—			18,750			35,931
Minority Interest		(772	)		(772	)		—			—			—			(3,677	)		(3,677	)		—			—			—
Earnings from continuing operations		7,810			—			—			5,094			12,904			17,181			—			—			18,750			35,931
Discontinued operations, net of tax and minority interest:
Operating earnings from Lumber Group		—			—			—			—			—			1,409			—			—			—			1,409
Operating loss from rental properties		(720	)		—			—			720			—			(229	)		—			—			229			—
Gain on disposition of rental properties		5,814			—			—			(5,814	)		—			18,979			—			—			(18,979	)		—
		5,094			—			—			(5,094	)		—			20,159			—			—			(18,750	)		1,409
Net earnings	$	12,904		$	—		$	—		$	—		$	12,904		$	37,340		$	—		$	—		$	—		$	37,340
(a)    Depreciation and amortization — Real Estate Groups	$	43,810		$	3,828		$	6,294		$	—		$	46,276		$	36,902		$	2,582		$	6,211		$	1,164		$	41,695
(b)    Depreciation and amortization — Non-Real Estate Groups		198			—			597			—			795			288			—			37			—			325
Total depreciation and amortization	$	44,008		$	3,828		$	6,891		$	—		$	47,071		$	37,190		$	2,582		$	6,248		$	1,164		$	42,020
(c)    Amortization of mortgage procurement costs — Real Estate Groups	$	3,480		$	757		$	303		$	—		$	3,026		$	3,723		$	671		$	281		$	39		$	3,372
(d)    Amortization of mortgage procurement costs — Non-Real Estate     Groups		84			—			385			—			469			41			—			148			—			189
Total amortization of mortgage procurement costs	$	3,564		$	757		$	688		$	—		$	3,495		$	3,764		$	671		$	429		$	39		$	3,561

(e) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 and therefore are reported in continuing operations when sold. For the three months ended October 31, 2005, one equity method investment was sold,Flower Park Plaza,resulting in a pre-tax gain on disposition of $2,526. This gain has been reported in Equity in Earnings of Unconsolidated Entities in the Company’s Consolidated Statement of Earnings and therefore is included in Earnings from Continuing Operations. For the three months ended October 31, 2004, there were no equity method investments sold.

8

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Reconciliation of Net Operating Income (non-GAAP) to Net Earnings (GAAP)(in thousands):

	Nine Months Ended October 31, 2005															Nine Months Ended October 31, 2004
							Plus															Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata			Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation			Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	911,550		$	94,263		$	231,690		$	3,209		$	1,052,186		$	750,928		$	107,607		$	200,554		$	20,658		$	864,533
Exclude straight-line rent adjustment(1)		(11,989	)		—			—			—			(11,989	)		(10,052	)		—			—			(849	)		(10,901	)
Adjusted revenues		899,561			94,263			231,690			3,209			1,040,197			740,876			107,607			200,554			19,809			853,632
Operating expenses		538,880			49,253			142,648			1,682			633,957			432,632			62,368			118,097			9,473			497,834
Add back depreciation and amortization for non-Real Estate Groups(b)		736			—			9,858			—			10,594			869			—			77			—			946
Add back amortization of mortgage procurement costs for non-Real Estate Groups(d)		286			—			453			—			739			140			—			266			—			406
Exclude straight-line rent adjustment(2)		(5,806	)		—			—			—			(5,806	)		(8,250	)		—			—			(5	)		(8,255	)
Adjusted operating expenses		534,096			49,253			152,959			1,682			639,484			425,391			62,368			118,440			9,468			490,931
Add interest income		18,819			1,713			505			100			17,711			36,843			3,715			116			123			33,367
Add equity in earnings of unconsolidated entities		46,029			—			(40,103	)		—			5,926			60,671			—			(55,661	)		—			5,010
Remove gain on disposition recorded on equity method		(21,023	)		—			21,023			—			—			(31,996	)		—			31,996			—			—
Add back provision for decline recorded on equity method		704			—			(704	)		—			—			—			—			—			—			—
Add back equity method depreciation and amortization expense (see below)		20,731			—			(20,731	)		—			—			21,080			—			(20,843	)		—			237
Net Operating Income		430,725			46,723			38,721			1,627			424,350			402,083			48,954			37,722			10,464			401,315
Interest expense, including early extinguishment of debt		(213,817	)		(23,030	)		(38,721	)		(2,236	)		(231,744	)		(183,126	)		(20,538	)		(37,722	)		(6,837	)		(207,147	)
Gain on disposition of equity method rental properties(e)		21,023			—			—			—			21,023			31,996			—			—			—			31,996
Gain on disposition of rental properties and other investments		606			—			—			9,476			10,082			—			—			—			52,037			52,037
Provision for decline in real estate		(6,100	)		(1,406	)		—			—			(4,694	)		—			—			—			—			—
Provision for decline in real estate of equity method rental properties		(704	)		—			—			—			(704	)		—			—			—			—			—
Depreciation and amortization — Real Estate Groups(a)		(129,647	)		(11,822	)		(19,825	)		(863	)		(138,513	)		(110,383	)		(6,653	)		(19,998	)		(4,321	)		(128,049	)
Amortization of mortgage procurement costs — Real Estate Groups(c)		(10,040	)		(2,302	)		(906	)		(15	)		(8,659	)		(10,633	)		(1,981	)		(845	)		(188	)		(9,685	)
Straight-line rent adjustment(1) + (2)		6,183			—			—			—			6,183			1,802			—			—			844			2,646
Equity method depreciation and amortization expense (see above)		(20,731	)		—			20,731			—			—			(21,080	)		—			20,843			—			(237	)
Earnings before income taxes		77,498			8,163			—			7,989			77,324			110,659			19,782			—			51,999			142,876
Income tax provision		(18,953	)		—			—			(3,087	)		(22,040	)		(36,854	)		—			—			(20,498	)		(57,352	)
Earnings before minority interest, discontinued operations and cumulative effect of change in accounting principle		58,545			8,163			—			4,902			55,284			73,805			19,782			—			31,501			85,524
Minority Interest		(8,163	)		(8,163	)		—			—			—			(19,782	)		(19,782	)		—			—			—
Earnings from continuing operations		50,382			—			—			4,902			55,284			54,023			—			—			31,501			85,524
Discontinued operations, net of tax and minority interest:
Operating earnings from Lumber Group		—			—			—			—			—			5,764			—			—			—			5,764
Operating earnings (loss) from rental properties		(912	)		—			—			912			—			44			—			—			(44	)		—
Loss on disposition of division of Lumber Group		—			—			—			—			—			(661	)		—			—			—			(661	)
Gain on disposition of rental properties		5,814			—			—			(5,814	)		—			31,457			—			—			(31,457	)		—
		4,902			—			—			(4,902	)		—			36,604			—			—			(31,501	)		5,103
Cumulative effect of change in accounting principle, net of tax		—			—			—			—			—			(11,261	)		—			—			—			(11,261	)
Net earnings	$	55,284		$	—		$	—		$	—		$	55,284		$	79,366		$	—		$	—		$	—		$	79,366
(a)    Depreciation and amortization — Real Estate Groups	$	129,647		$	11,822		$	19,825		$	863		$	138,513		$	110,383		$	6,653		$	19,998		$	4,321		$	128,049
(b)    Depreciation and amortization — Non-Real Estate Groups		736			—			9,858			—			10,594			869			—			77			—			946
Total depreciation and amortization	$	130,383		$	11,822		$	29,683		$	863		$	149,107		$	111,252		$	6,653		$	20,075		$	4,321		$	128,995
(c)    Amortization of mortgage procurement costs — Real Estate     Groups	$	10,040		$	2,302		$	906		$	15		$	8,659		$	10,633		$	1,981		$	845		$	188		$	9,685
(d)    Amortization of mortgage procurement costs — Non-Real Estate     Groups		286			—			453			—			739			140			—			266			—			406
Total amortization of mortgage procurement costs	$	10,326		$	2,302		$	1,359		$	15		$	9,398		$	10,773		$	1,981		$	1,111		$	188		$	10,091

(e) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 and therefore are reported in continuing operations when sold. For the nine months ended October 31, 2005, three equity method investments were sold includingFlower Park Plaza, ShowcaseandColony Place, resulting in a pre-tax gain on disposition of $21,023. For the nine months ended October 31, 2004, three equity method investments were sold includingChapel Hill Mall, Chapel Hill Suburban,andManhattan Town Center Mall, resulting in a pre-tax gain of $31,996 which is included in Equity in Earnings of Unconsolidated Entities in the Company’s Consolidated Statement of Earnings.

9

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Retail Lease Expirations
As of October 31, 2005

													AVERAGE
													BASE
	NUMBER OF		SQUARE FEET		PERCENTAGE			NET		PERCENTAGE			RENT PER
EXPIRATION	EXPIRING		OF EXPIRING		OF TOTAL			BASE RENT		OF TOTAL			SQUARE FEET
YEAR	LEASES		LEASES(3)		LEASED GLA(1)			EXPIRING(2)		BASE RENT			EXPIRING(3)
2005		65		148,882		1.48	%	$	3,400,452		1.82	%	$	27.81
2006		206		501,864		4.99			10,972,527		5.88			28.21
2007		169		586,511		5.83			9,288,253		4.98			21.58
2008		167		599,413		5.97			10,709,593		5.74			23.93
2009		224		765,031		7.61			12,695,316		6.81			23.50
2010		171		592,379		5.90			11,925,977		6.40			25.44
2011		246		1,074,860		10.70			25,347,007		13.59			28.59
2012		124		673,980		6.71			14,052,708		7.54			25.73
2013		140		599,067		5.96			14,869,386		7.97			27.88
2014		159		684,966		6.82			12,693,818		6.81			27.27
2015		130		636,882		6.34			14,671,029		7.87			26.70
Thereafter		96		3,184,549		31.69			45,859,941		24.59			18.80
Total		1,897		10,048,384		100.00	%	$	186,486,007		100.00	%	$	23.75

(1)	GLA = Gross Leasable Area.
(2)	Net base rent expiring is an operating statistic and is not comparable to rental revenue, a GAAP financial measure. The primary differences arise because net base rent is determined using the tenant’s contractual rental agreements at the Company’s ownership share of the base rental income from expiring leases as determined within the rent agreement and it does not include adjustments such as the impact of straight-line rent and contingent rental payments, which are not reasonably estimatable.
(3)	Square feet of expiring leases and average base rent per square feet are operating statistics that represent 100% of the square footage and base rental income per square foot from expiring leases.

10

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Office Lease Expirations
As of October 31, 2005

													AVERAGE
													BASE
	NUMBER OF		SQUARE FEET		PERCENTAGE			NET		PERCENTAGE			RENT PER
EXPIRATION	EXPIRING		OF EXPIRING		OF TOTAL			BASE RENT		OF TOTAL			SQUARE FEET
YEAR	LEASES		LEASES(3)		LEASED GLA(1)			EXPIRING(2)		BASE RENT			EXPIRING(3)
2005		26		171,856		2.05	%	$	2,846,247		1.51	%	$	22.36
2006		56		627,752		7.48			11,206,713		5.96			25.27
2007		51		385,644		4.59			6,680,575		3.55			22.93
2008		62		514,152		6.13			9,455,912		5.03			21.88
2009		42		371,403		4.43			7,741,615		4.11			25.44
2010		36		1,017,041		12.13			14,477,247		7.69			22.34
2011		10		231,177		2.76			6,878,975		3.66			31.39
2012		14		709,001		8.45			19,603,381		10.42			31.33
2013		17		695,574		8.29			14,493,767		7.70			24.87
2014		9		582,721		6.95			12,482,685		6.63			27.75
2015		3		92,939		1.11			2,332,747		1.24			25.91
Thereafter		30		2,988,665		35.63			79,977,803		42.50			31.63
Total		356		8,387,925		100.00	%	$	188,177,677		100.00	%	$	27.64

(1)	GLA = Gross Leasable Area.
(2)	Net base rent expiring is an operating statistic and is not comparable to rental revenue, a GAAP financial measure. The primary differences arise because net base rent is determined using the tenant’s contractual rental agreements at the Company’s ownership share of the base rental income from expiring leases as determined within the rent agreement and it does not include adjustments such as the impact of straight-line rent and contingent rental payments, which are not reasonably estimatable.
(3)	Square feet of expiring leases and average base rent per square feet are operating statistics that represent 100% of the square footage and base rental income per square foot from expiring leases.

11

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Schedule of Significant Retail Tenants
As of October 31, 2005

(Based on net base rent 1% or greater of the Company’s ownership share)

					PERCENTAGE
	NUMBER		LEASED		OF TOTAL
	OF		SQUARE		RETAIL
TENANT	LEASES		FEET		SQUARE FEET
Regal Entertainment Group		6		451,072		4.49	%
AMC Entertainment, Inc.		4		325,563		3.24
The Gap		23		289,509		2.88
The Home Depot		2		282,000		2.81
TJX Companies		8		272,554		2.71
The Limited		37		236,608		2.35
Dick’s Sporting Goods		3		226,408		2.25
Circuit City Stores, Inc.		5		164,842		1.64
Lowe’s Home Center, Inc.		1		151,273		1.51
Abercrombie & Fitch Stores, Inc.		21		142,266		1.42
Footlocker, Inc.		34		123,638		1.23
Pathmark Stores, Inc.		2		123,500		1.23
Ahold USA (Stop & Shop)		2		115,861		1.15
DSW Shoe Warehouse, Inc.		4		112,040		1.12
Subtotal		152		3,017,134		30.03
All Others		1,745		7,031,250		69.97
Total		1,897		10,048,384		100.00	%

12

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Schedule of Significant Office Tenants
As of October 31, 2005

(Based on net base rent 2% or greater of the Company’s ownership share)

			PERCENTAGE
			OF TOTAL
	LEASED		OFFICE
TENANT	SQUARE FEET		SQUARE FEET
City of New York		855,008		10.19	%
U.S. Government		749,016		8.93
Millennium Pharmaceuticals, Inc.		725,833		8.65
Morgan Stanley & Co.		444,685		5.30
Securities Industry Automation Corp.		428,786		5.11
Wellchoice, Inc.		392,514		4.68
Keyspan Energy		328,679		3.92
Forest City Enterprises, Inc.(1)		319,957		3.81
Bank of New York		317,572		3.79
Bear Stearns		275,244		3.28
Alkermes, Inc.		210,248		2.51
Partners Health Care System, Inc.		136,150		1.62
University of Pennsylvania		121,630		1.45
Subtotal		5,305,322		63.25
All Others		3,082,603		36.75
Total		8,387,925		100.00	%

(1) All intercompany rental income is eliminated in consolidation.

13

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Development Pipeline
October 31, 2005
2005 Openings and Acquisitions (8)

														Cost at FCE
				FCE Legal			Pro-Rata FCE %(i)			Cost at Full		Total Cost		Pro-Rata Share		Square Feet/
		Dev.(D)	Date Opened/	Ownership%(i)						Consolidation		at 100%		(Non-GAAP)(b)		Number of
Property	Location	Acq.(A)	Acquired	(1)			(2)			(GAAP)(a)		(3)		(2)X(3)		Units
												(in millions)
Retail Centers:
Saddle Rock Village	Aurora, CO	D	Q1-05/Q3-06		80.0	%		100.0	%	$	33.8	$	33.8	$	33.8		354,000
Short Pump Town Center Expansion	Richmond, VA	D	Q3-05		50.0	%		100.0	%		27.3		27.3		27.3		88,000
Simi Valley Town Center	Simi Valley, CA	D	Q3-05		85.0	%		100.0	%		149.0		149.0		149.0		660,000
										$	210.1	$	210.1	$	210.1		1,102,000
Office:
Ballston Common Office Center	Arlington, VA	A	Q2-05		50.0	%		100.0	%	$	63.0	$	63.0	$	63.0		176,000
Residential:
23 Sidney Street	Cambridge, MA	D	Q1-05		100.0	%		100.0	%	$	17.8	$	17.8	$	17.8		51
Metro 417(m)	Los Angeles, CA	D	Q2-05		75.0	%		100.0	%		78.3		78.3		78.3		277
100 Lansdowne Street	Cambridge, MA	D	Q3-05		100.0	%		100.0	%		66.2		66.2		66.2		203
Ashton Mill	Cumberland, RI	D	Q3-05		90.0	%		100.0	%		45.3		45.3		45.3		193
										$	207.6	$	207.6	$	207.6		724
Total 2005 Openings(b)										$	480.7	$	480.7	$	480.7
Residential Phased-In Unit(c)(e)																Opened in ’05 / Total
Newport Landing	Coventry, OH	D	2002-05		50.0	%		50.0	%	$	0.0	$	16.0	$	8.0		60/336
Arbor Glen	Twinsburg, OH	D	2004-07		50.0	%		50.0	%		0.0		18.4		9.2		48/288
Woodgate/Evergreen Farms	Olmsted Township, OH	D	2004-07		33.0	%		33.0	%		0.0		22.9		7.6		168 / 348
Total(b)(f)										$	0.0	$	57.3	$	24.8		276 / 972

See attached October 31, 2005 footnotes.

14

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Development Pipeline
October 31, 2005
Under Construction (13)

				FCE										Cost at FCE
				Legal			Pro-Rata			Cost at Full		Total Cost		Pro-Rata Share		Square Feet/
		Dev.(D)	Anticipated	Ownership%(i)			FCE %(i)			Consolidation		at 100%		(Non-GAAP)(b)		Number of
Property	Location	Acq.(A)	Opening	(1)			(2)			(GAAP)(a)		(3)		(2)X(3)		Units			Pre-Leased %
										(in millions)
Retail Centers:
Northfield at Stapleton(p)	Denver, CO	D	Q4-05/Q1-06/ Q3-06		95.0	%		97.4	%	$	176.7	$	176.7	$	172.1		1,117,000	(n)		60	%
San Francisco Centre-Emporium(c)(j)	San Francisco, CA	D	Q3-06		50.0	%		50.0	%		0.0		425.0		212.5		964,000	(o)		67	%
Bolingbrook South	Bolingbrook, IL	D	Q1-07		100.0	%		100.0	%		109.3		109.3		109.3		698,000			30	%
										$	286.0	$	711.0	$	493.9		2,779,000
Office:
Illinois Science and Technology Park(r)	Skokie, IL	A/D	Q3-06		100.0	%		100.0	%	$	77.5	$	77.5	$	77.5		673,000			0	%
Edgeworth Building	Richmond, VA	D	Q4-06		100.0	%		100.0	%		35.2		35.2		35.2		166,000			48	%
New York Times(c)	Manhattan, NY	D	Q2-07		28.0	%		40.0	%		0.0		415.0		166.0		734,000			0	%
										$	112.7	$	527.7	$	278.7		1,573,000
Residential:
Sterling Glen of Lynbrook(g)(k)	Lynbrook, NY	D	Q4-05		80.0	%		80.0	%	$	30.8	$	30.8	$	24.6		100
Met Lofts(c)	Los Angeles, CA	D	Q4-05		50.0	%		50.0	%		0.0		65.4		32.7		264
1255 S. Michigan (Central Station)	Chicago, IL	D	Q1-06		100.0	%		100.0	%		126.6		126.6		126.6		502
Sterling Glen of Roslyn(g)(l)	Roslyn, NY	D	Q2-06		40.0	%		80.0	%		73.2		73.2		58.6		158
Ohana Military Communities(c)(e)	Honolulu, HI	D	2005-2008		10.0	%		10.0	%		0.0		316.5		31.7		1,952
										$	230.6	$	612.5	$	274.2		2,976
																			Pre-Sold %
Condominiums:
1100 Wilshire(c)	Los Angeles, CA	D	Q1-06		50.0	%		50.0	%	$	0.0	$	118.2	$	59.1		228			66	%
3800 Wilshire(c)	Los Angeles, CA	D	Q3-06		50.0	%		50.0	%		0.0		153.3		76.7		238			0	%
										$	0.0	$	271.5	$	135.8		466
Total Under Construction(b)(h)										$	629.3	$	2,122.7	$	1,182.6
LESS: Above properties to be sold as condominiums										$	0.0	$	271.5	$	135.8
Under Construction less Condominiums										$	629.3	$	1,851.2	$	1,046.8
Residential Phased-In Units Under Construction:(c)(e)																Under Const./ Total
Arbor Glen	Twinsburg, OH	D	2004-07		50.0	%		50.0	%	$	0.0	$	18.4	$	9.2		96 / 288
Woodgate/Evergreen Farms	Olmsted Township, OH	D	2004-07		33.0	%		33.0	%		0.0		22.9		7.6		180 / 348
Pine Ridge Expansion	Willoughby Hills, OH	D	2005-06		50.0	%		50.0	%		0.0		16.4		8.2		162 / 162
Total(b)(q)										$	0.0	$	57.7	$	25.0		438 / 798

     See attached October 31, 2005 footnotes.

15

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Development Pipeline

October 31, 2005 Footnotes

(a)	Amounts are presented on the full consolidation method of accounting, a GAAP measure. Under full consolidation, costs are reported as consolidated at 100 percent if we are deemed to have control or to be the primary beneficiary of our investments in the variable interest entity (“VIE”).
(b)	Cost at pro-rata share represents Forest City’s share of cost, based on the Company’s pro-rata ownership of each property (a non-GAAP measure). Under the pro-rata consolidation method of accounting the Company determines its pro-rata share by multiplying its pro-rata ownership by the total cost of the applicable property.
(c)	Reported under the equity method of accounting. This method represents a GAAP measure for investments in which the Company is not deemed to have control or to be the primary beneficiary of our investments in a VIE.
(d)	Not used.
(e)	Phased-in openings. Costs are representative of the total project.
(f)	The difference between the full consolidation amount (GAAP) of $-0- of cost to the Company’s pro-rata share (a non-GAAP measure) of $24,800,000 of cost consists of the Company’s share of cost for unconsolidated investments of $24,800,000.
(g)	Supported-living property.
(h)	The difference between the full consolidation amount (GAAP) of $629,300,000 of cost to the Company’s pro-rata share (a non-GAAP measure) of $1,182,600,000 of cost consists of a reduction to full consolidation for minority interest of $25,400,000 of cost and the addition of its share of cost for unconsolidated investments of $578,700,000.
(i)	As is customary within the real estate industry, the Company invests in certain real estate projects through joint ventures. For these projects, the Company provides funding for certain of its partners’ equity contributions. The Company consolidates its investments in these projects in accordance with FIN No. 46 (R) at a consolidation percentage that is reflected in the Pro-Rata FCE % column. These advances entitle the Company to a preferred return on investment, which is payable from cash flows of each respective property. At the point the Company is no longer entitled to a preferred return on a particular joint venture because the partner’s advance has been repaid in full, the Company’s net assets will be adjusted to its intended ownership percentage (reflected in the FCE Legal Ownership % column) by recording a minority interest to reflect the amount of the partner’s claim on those net assets.
(j)	This project will also include an option to purchase the adjacent retail center totaling 508,000 square feet.
(k)	Formerly Tanglewood Crest.
(l)	Formerly Bryant Landing.
(m)	Formerly Subway Terminal.
(n)	Includes 39,000 square feet of office space.
(o)	Includes 235,000 square feet of office space.
(p)	Phased opening: Phase I opens Q4-05, Phase II opens Q1-06, Phase III opens Q3-06.
(q)	The difference between the full consolidation amount (GAAP) of $-0- of cost to the Company’s pro-rata share (a non-GAAP measure) of $25,000,000 of cost consists of Forest City’s share of cost for unconsolidated investments of $25,000,000.
(r)	Formerly Pfizer.

16

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Mortgage Financings

Our primary capital strategy seeks to isolate the financial risk at the property level to maximize returns on our equity capital. All of our mortgage debt is nonrecourse, including our construction loans. We operate as a C-corporation and retain substantially all of our internally generated cash flows. We recycle this cash flow, together with refinancing and property sale proceeds to fund new development and acquisitions that drive favorable returns for our shareholders. This strategy provides us with the necessary liquidity to take advantage of investment opportunities.

We use taxable and tax-exempt nonrecourse debt for our real estate projects. For those real estate projects financed with taxable debt, we generally seek long-term fixed rate financing for those real estate project loans which mature within the next 12 months as well as those real estate projects which are projected to open and achieve stabilized operations during that same time frame. For real estate projects financed with tax-exempt debt, we generally utilize variable rate debt. For construction loans, we generally pursue variable-rate financings with maturities ranging from two to five years.

We are actively working to extend the maturities and/or refinance the nonrecourse debt that is coming due in 2005 and 2006. During the nine months ended October 31, 2005, we completed the following financings:

					Plus Unconsolidated
			Less Minority		Investments at		Pro-Rata
Purpose of Financing	Full Consolidation		Interest		Pro-Rata		Consolidation
			(in thousands)
Refinancings	$	512,360	$	108,500	$	34,934	$	438,794
Development projects (commitment)/acquisitions		321,120		6,642		89,210		403,688
Loan extensions/additional fundings		89,122		5,568		7,764		91,318
	$	922,602	$	120,710	$	131,908	$	933,800

17

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Scheduled Maturities Table: Nonrecourse Mortgage Debt(dollars in thousands)
As of October 31, 2005

	Period Ending January 31,												Fiscal Year Ending January 31,
	2006												2007
							Plus												Plus
							Unconsolidated												Unconsolidated
	Full			Less Minority			Investments at			Pro-Rata			Full			Less Minority			Investments at			Pro-Rata
	Consolidation			Interest			Pro-Rata			Consolidation			Consolidation			Interest			Pro-Rata			Consolidation
Fixed:							��
Fixed-rate debt	$	17,962		$	2,765		$	21,948		$	37,145		$	325,144		$	17,671		$	20,242		$	327,715
Weighted average rate		6.92	%		7.31	%		5.71	%		6.18	%		6.81	%		6.92	%		7.76	%		6.86	%
UDAG		10,695			46			10,728			21,377			8,361			173			1,350			9,538
Weighted average rate		3.98	%		2.98	%		8.00	%		6.00	%		0.21	%		2.67	%		1.00	%		0.28	%
Total fixed-rate debt		28,657			2,811			32,676			58,522			333,505			17,844			21,592			337,253
Variable:
Variable-rate debt		123,648			6,806			35,487			152,329			347,163			91,674			69,823			325,312
Weighted average rate		6.28	%		5.77	%		6.61	%		6.38	%		6.46	%		6.86	%		6.34	%		6.32	%
Tax-Exempt		20,261			1			5,061			25,321			94,773			5,867			31,705			120,611
Weighted average rate		3.59	%		4.62	%		4.03	%		3.68	%		3.88	%		3.39	%		4.06	%		3.95	%
Total variable-rate debt		143,909			6,807			40,548			177,650			441,936			97,541			101,528			445,923
Total Nonrecourse Mortgage Debt	$	172,566		$	9,618		$	73,224		$	236,172		$	775,441		$	115,385		$	123,120		$	783,176
Weighted Average Rate		5.89	%		6.20	%		6.37	%		6.02	%		6.22	%		6.68	%		5.93	%		6.11	%

		Fiscal Year Ending January 31,												Fiscal Year Ending January 31,
		2008												2009
								Plus												Plus
								Unconsolidated												Unconsolidated
		Full			Less Minority			Investments at			Pro-Rata			Full			Less Minority			Investments at			Pro-Rata
	��	Consolidation			Interest			Pro-Rata			Consolidation			Consolidation			Interest			Pro-Rata			Consolidation
Fixed:
Fixed-rate debt		$	156,883		$	27,201		$	99,033		$	228,715		$	182,698		$	19,061		$	90,896		$	254,533
Weighted average rate			6.85	%		6.95	%		7.48	%		7.11	%		7.19	%		7.00	%		6.82	%		7.08	%
UDAG			728			180			—			548			726			188			948			1,486
Weighted average rate			2.56	%		2.74	%		—			2.50	%		2.50	%		2.80	%		—			0.87	%
Total fixed-rate debt			157,611			27,381			99,033			229,263			183,424			19,249			91,844			256,019
Variable:
Variable-rate debt			175,439			17,616			30,528			188,351			41,018			—			58,666			99,684
Weighted average rate			5.79	%		5.38	%		5.78	%		5.82	%		6.15	%		—			6.54	%		6.38	%
Tax-Exempt			127,670			2,400			2,594			127,864			16,000			—			—			16,000
Weighted average rate			4.18	%		4.23	%		2.70	%		4.15	%		4.25	%		—			—			4.25	%
Total variable-rate debt			303,109			20,016			33,122			316,215			57,018			—			58,666			115,684
Total Nonrecourse Mortgage Debt		$	460,720		$	47,397		$	132,155		$	545,478		$	240,442		$	19,249		$	150,510		$	371,703
Weighted Average Rate			5.70	%		6.21	%		6.99	%		5.97	%		6.80	%		6.96	%		6.67	%		6.74	%

18

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Scheduled Maturities Table: Nonrecourse Mortgage Debt(dollars in thousands)(continued)
As of October 31, 2005

	Fiscal Year Ending January 31,
	2010												Thereafter
							Plus												Plus
							Unconsolidated												Unconsolidated
	Full			Less Minority			Investments at			Pro-Rata			Full			Less Minority			Investments at			Pro-Rata
	Consolidation			Interest			Pro-Rata			Consolidation			Consolidation			Interest			Pro-Rata			Consolidation
Fixed:
Fixed-rate debt	$	253,020		$	57,815		$	97,375		$	292,580		$	2,408,169		$	307,643		$	235,150		$	2,335,676
Weighted average rate		7.07	%		7.44	%		7.08	%		7.00	%		6.29	%		6.57	%		6.17	%		6.24	%
UDAG		724			197			—			527			82,358			18,563			—			63,795
Weighted average rate		2.44	%		2.85	%		—			2.28	%		1.53	%		1.28	%		—			1.60	%
Total fixed-rate debt		253,744			58,012			97,375			293,107			2,490,527			326,206			235,150			2,399,471
Variable:
Variable-rate debt		2,097			—			9,483			11,580			64,249			—			53,029			117,278
Weighted average rate		5.41	%		—			5.16	%		5.21	%		5.48	%		—			5.61	%		5.54	%
Tax-Exempt		—			—			40,000			40,000			587,781			34,378			44,000			597,403
Weighted average rate		—			—			3.24	%		3.24	%		3.98	%		3.83	%		3.60	%		3.97	%
Total variable-rate debt		2,097			—			49,483			51,580			652,030			34,378			97,029			714,681
Total Nonrecourse Mortgage Debt	$	255,841		$	58,012		$	146,858		$	344,687		$	3,142,557		$	360,584		$	332,179		$	3,114,152
Weighted Average Rate		7.04	%		7.42	%		5.91	%		6.49	%		5.72	%		6.04	%		5.74	%		5.68	%

	Total
							Plus
							Unconsolidated
	Full			Less Minority			Investments at			Pro-Rata
	Consolidation			Interest			Pro-Rata			Consolidation
Fixed:
Fixed-rate debt	$	3,343,876		$	432,156		$	564,644		$	3,476,364
Weighted average rate		6.48	%		6.75	%		6.70	%		6.47	%
UDAG		103,592			19,347			13,026			97,271
Weighted average rate		1.69	%		1.34	%		6.69	%		2.43	%
Total fixed-rate debt		3,447,468			451,503			577,670			3,573,635
Variable:
Variable-rate debt		753,614			116,096			257,016			894,534
Weighted average rate		6.17	%		6.57	%		6.16	%		6.12	%
Tax-Exempt		846,485			42,646			123,360			927,199
Weighted average rate		4.00	%		3.79	%		3.60	%		3.95	%
Total variable-rate debt		1,600,099			158,742			380,376			1,821,733
Total Nonrecourse Mortgage Debt	$	5,047,567		$	610,245		$	958,046		$	5,395,368
Weighted Average Rate		5.92	%		6.34	%		6.16	%		5.91	%

19

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

As discussed on page 2, we present certain financial amounts under the pro-rata consolidation method (a non-GAAP measure). This information is useful to our investors because we believe that it more accurately reflects the manner in which we operate our business. This is because, in line with industry practice, we have a large number of investments in which our economic ownership is less than 100% as a means of procuring opportunities and sharing risk. The tables below present amounts for both full consolidation, a GAAP measure, and pro-rata consolidation, providing a reconciliation of the difference between the two methods. Under the pro-rata consolidation method, we present our partnership investments proportionate to our share of ownership for each line item of our consolidated financial statements. Under full consolidation, partnership assets and liabilities are reported as consolidated at 100% if deemed to be under our control or if we are deemed to be the primary beneficiary for our investments in a VIE. Partnership assets and liabilities are reported on the equity or cost method of accounting if we do not have control, or, in the case of investments in VIEs, the Company is not deemed the primary beneficiary.

Consolidated Balance Sheet Information — October 31, 2005 (unaudited)

							Plus
	Full						Unconsolidated			Pro-Rata
	Consolidation			Less Minority			Investments at			Consolidation
	(GAAP)			Interest			Pro-Rata			(Non-GAAP)
				(in thousands)
Assets
Real Estate
Completed rental properties	$	6,132,282		$	761,614		$	894,747		$	6,265,415
Projects under development		825,733			68,310			393,668			1,151,091
Land held for development or sale		99,120			3,038			103,742			199,824
Total Real Estate		7,057,135			832,962			1,392,157			7,616,330
Less accumulated depreciation		(965,475	)		(143,906	)		(263,983	)		(1,085,552	)
Real Estate, net		6,091,660			689,056			1,128,174			6,530,778
Cash and equivalents		117,831			19,731			15,818			113,918
Restricted cash		481,430			37,768			54,670			498,332
Notes and accounts receivable, net		233,514			48,127			(11,421	)		173,966
Investments in and advances to affiliates		402,182			—			(164,062	)		238,120
Other assets		486,814			32,896			97,982			551,900
Total Assets	$	7,813,431		$	827,578		$	1,121,161		$	8,107,014
Liabilities and Shareholders’ Equity
Liabilities
Mortgage debt, nonrecourse	$	5,047,567		$	610,245		$	958,046		$	5,395,368
Notes payable		73,912			15,675			70,486			128,723
Bank revolving credit facility		100,000			—			—			100,000
Senior and subordinated debt		599,400			—			—			599,400
Accounts payable and accrued expenses		653,466			93,189			92,629			652,906
Deferred income taxes		372,984			—			—			372,984
Total Liabilities		6,847,329			719,109			1,121,161			7,249,381
Minority Interest		108,469			108,469			—			—
Total Shareholders’ Equity		857,633			—			—			857,633
Total Liabilities and Shareholders’ Equity	$	7,813,431		$	827,578		$	1,121,161		$	8,107,014

20

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Balance Sheet Information — January 31, 2005 (unaudited)

							Plus
	Full						Unconsolidated			Pro-Rata
	Consolidation			Less Minority			Investments at			Consolidation
	(GAAP)			Interest			Pro-Rata			(Non-GAAP)
				(in thousands)
Assets
Real Estate
Completed rental properties	$	5,708,558		$	843,631		$	929,275		$	5,794,202
Projects under development		634,441			20,300			255,124			869,265
Land held for development or sale		94,907			3,577			93,755			185,085
Total Real Estate		6,437,906			867,508			1,278,154			6,848,552
Less accumulated depreciation		(865,562	)		(141,674	)		(255,221	)		(979,109	)
Real Estate, net		5,572,344			725,834			1,022,933			5,869,443
Cash and equivalents		276,492			24,090			11,956			264,358
Restricted cash		347,267			28,478			57,296			376,085
Notes and accounts receivable, net		212,868			51,127			854			162,595
Investments in and advances to affiliates		415,234			—			(166,337	)		248,897
Other assets		497,880			48,581			99,463			548,762
Total Assets	$	7,322,085		$	878,110		$	1,026,165		$	7,470,140
Liabilities and Shareholders’ Equity
Liabilities
Mortgage debt, nonrecourse	$	4,787,191		$	649,959		$	892,617		$	5,029,849
Notes payable		93,432			16,529			51,706			128,609
Bank revolving credit facility		—			—			—			—
Senior and subordinated debt		599,400			—			—			599,400
Accounts payable and accrued expenses		587,274			115,849			81,842			553,267
Deferred income taxes		354,490			—			—			354,490
Total Liabilities		6,421,787			782,337			1,026,165			6,665,615
Minority Interest		95,773			95,773			—			—
Total Shareholders’ Equity		804,525			—			—			804,525
Total Liabilities and Shareholders’ Equity	$	7,322,085		$	878,110		$	1,026,165		$	7,470,140

21

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information — Three Months Ended October 31, 2005 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
							(in thousands)
Revenues from real estate operations	$	291,236		$	29,840		$	81,644		$	165		$	343,205
Expenses
Operating expenses		175,354			15,892			49,633			274			209,369
Interest expense, including early extinguishment of debt		70,270			7,767			12,283			1,165			75,951
Amortization of mortgage procurement costs		3,564			757			688			—			3,495
Provision for decline in real estate		3,480			1,360			—			—			2,120
Depreciation and amortization		44,008			3,828			6,891			—			47,071
		296,676			29,604			69,495			1,439			338,006
Interest income		5,080			536			58			100			4,702
Equity in earnings of unconsolidated entities (Note 1)		16,113			—			(14,733	)		—			1,380
Gain on disposition of rental properties and other investments		—			—			2,526			9,476			12,002
Earnings before income taxes		15,753			772			—			8,302			23,283
Income tax expense (benefit)
Current		(1,640	)		—			—			(461	)		(2,101	)
Deferred		8,811			—			—			3,669			12,480
		7,171			—			—			3,208			10,379
Earnings before minority interest and discontinued operations		8,582			772			—			5,094			12,904
Minority interest		(772	)		(772	)		—			—			—
Earnings from continuing operations		7,810			—			—			5,094			12,904
Discontinued operations, net of tax:
Operating loss from rental properties		(720	)		—			—			720			—
Gain on disposition of rental properties		5,814			—			—			(5,814	)		—
		5,094			—			—			(5,094	)		—
Net earnings	$	12,904		$	—		$	—		$	—		$	12,904

Note 1) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets,” and therefore are reported in continuing operations when sold. For the three months ended October 31, 2005, one equity method investment was sold,Flower Park Plaza. A pre-tax gain of $2,526 ($1,550 net of tax) has been reported in equity in earnings of unconsolidated entities in the Consolidated Statement of Earnings, and therefore is included in Earnings from Continuing Operations.

22

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information — Nine Months Ended October 31, 2005 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
							(in thousands)
Revenues from real estate operations	$	911,550		$	94,263		$	231,690		$	3,209		$	1,052,186
Expenses
Operating expenses		538,880			49,253			142,648			1,682			633,957
Interest expense, including early extinguishment of debt		213,817			23,030			38,721			2,236			231,744
Amortization of mortgage procurement costs		10,326			2,302			1,359			15			9,398
Provision for decline in real estate		6,100			1,406			704			—			5,398
Depreciation and amortization		130,383			11,822			29,683			863			149,107
		899,506			87,813			213,115			4,796			1,029,604
Interest income		18,819			1,713			505			100			17,711
Equity in earnings of unconsolidated entities (Note 1)		46,029			—			(40,103	)		—			5,926
Gain on disposition of rental properties and other investments		606			—			21,023			9,476			31,105
Earnings before income taxes		77,498			8,163			—			7,989			77,324
Income tax expense (benefit)
Current		3,069			—			—			(498	)		2,571
Deferred		15,884			—			—			3,585			19,469
		18,953			—			—			3,087			22,040
Earnings before minority interest and discontinued operations		58,545			8,163			—			4,902			55,284
Minority interest		(8,163	)		(8,163	)		—			—			—
Earnings from continuing operations		50,382			—			—			4,902			55,284
Discontinued operations, net of tax:
Operating loss from rental properties		(912	)		—			—			912			—
Gain on disposition of rental properties		5,814			—			—			(5,814	)		—
		4,902			—			—			(4,902	)		—
Net earnings	$	55,284		$	—		$	—		$	—		$	55,284

Note 1) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets,” and therefore are reported in continuing operations when sold. For the nine months ended October 31, 2005, three equity method investments were sold,Flower Park Plaza, Colony PlaceandShowcase, resulting in a pre-tax gain on disposition of $21,023 ($12,900 net of tax). This gain has been reported in equity in earnings of unconsolidated entities in the Consolidated Statement of Earnings, and therefore is included in Earnings from Continuing Operations.

23

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information — Three Months Ended October 31, 2004 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
							(in thousands)
Revenues from real estate operations	$	250,317		$	27,939		$	67,448		$	5,397		$	295,223
Expenses
Operating expenses		148,693			17,127			39,402			2,807			173,775
Interest expense, including early extinguishment of debt		67,759			6,422			12,943			1,862			76,142
Amortization of mortgage procurement costs		3,764			671			429			39			3,561
Depreciation and amortization		37,190			2,582			6,248			1,164			42,020
		257,406			26,802			59,022			5,872			295,498
Interest income		28,907			2,536			156			67			26,594
Equity in earnings of unconsolidated entities (Note 1)		10,777			4			(8,582	)		—			2,191
Gain on disposition of rental properties		—			—			—			31,397			31,397
Earnings before income taxes		32,595			3,677			—			30,989			59,907
Income tax expense (benefit)
Current		(9,005	)		—			—			(324	)		(9,329	)
Deferred		20,742			—			—			12,563			33,305
		11,737			—			—			12,239			23,976
Earnings before minority interest and discontinued operations		20,858			3,677			—			18,750			35,931
Minority interest		(3,677	)		(3,677	)		—			—			—
Earnings from continuing operations(Note 1)		17,181			—			—			18,750			35,931
Discontinued operations, net of tax:
Operating earnings from Lumber Group		1,409			—			—			—			1,409
Operating loss from rental properties		(229	)		—			—			229			—
Gain on disposition of rental properties		18,979			—			—			(18,979	)		—
		20,159			—			—			(18,750	)		1,409
Net earnings	$	37,340		$	—		$	—		$	—		$	37,340

Note 1) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets,” and therefore are reported in continuing operations when sold. For the three months ended October 31, 2004, there were no equity method investments sold.

24

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information – Nine Months Ended October 31, 2004 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
							(in thousands)
Revenues from real estate operations	$	750,928		$	107,607		$	200,554		$	20,658		$	864,533
Expenses
Operating expenses		432,632			62,368			118,097			9,473			497,834
Interest expense, including early extinguishment of debt		183,126			20,538			37,722			6,837			207,147
Amortization of mortgage procurement costs		10,773			1,981			1,111			188			10,091
Depreciation and amortization		111,252			6,653			20,075			4,321			128,995
		737,783			91,540			177,005			20,819			844,067
Interest income		36,843			3,715			116			123			33,367
Equity in earnings of unconsolidated entities (Note 1)		60,671			—			(55,661	)		—			5,010
Gain on disposition of rental properties		—			—			31,996			52,037			84,033
Earnings before income taxes		110,659			19,782			—			51,999			142,876
Income tax expense (benefit)
Current		(10,118	)		—			—			116			(10,002	)
Deferred		46,972			—			—			20,382			67,354
		36,854			—			—			20,498			57,352
Earnings before minority interest, discontinued operations, and cumulative effect of change in accounting principle		73,805			19,782			—			31,501			85,524
Minority interest		(19,782	)		(19,782	)		—			—			—
Earnings from continuing operations(Note 1)		54,023			—			—			31,501			85,524
Discontinued operations, net of tax and minority interest:
Operating earnings from Lumber Group		5,764			—			—			—			5,764
Operating earnings from rental properties		44			—			—			(44	)		—
Loss on disposition of division of Lumber Group		(661	)		—			—			—			(661	)
Gain on disposition of rental properties		31,457			—			—			(31,457	)		—
		36,604			—			—			(31,501	)		5,103
Cumulative effect of change in accounting principle, net of tax		(11,261	)		—			—			—			(11,261	)
Net earnings	$	79,366		$	—		$	—		$	—		$	79,366

Note 1) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets,” and therefore are reported in continuing operations when sold. For the nine months ended October 31, 2004, three equity method investments were sold,Chapel Hill Mall, Chapel Hill Suburban,andManhattan Town Center Mall.A pre-tax gain of $31,996 ($19,341 net of tax) has been reported in equity in earnings of unconsolidated entities in the Consolidated Statement of Earnings, and therefore is included in Earnings from Continuing Operations.

25

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

The following schedules on pages 26-27 present information on investments in and advances to affiliates.

Investments in and Advances to Affiliates

Included in Investments in and Advances to Affiliates in the Consolidated Balance Sheet Information tables are unconsolidated investments in entities that we do not control or are not the primary beneficiary and that are accounted for under the equity method of accounting, as well as advances to partners and other affiliates.

Following is a reconciliation of members’ and partners’ equity to our carrying value in the accompanying Consolidated Balance Sheet Information:

	October 31,		January 31,
	2005		2005
	(in thousands)
Members’ and Partners’ equity, as below	$	617,079	$	619,670
Equity of other members and partners		453,017		453,333
Company’s investment in partnerships		164,062		166,337
Advances to partners and other affiliates(1)		238,120		248,897
Investments in and advances to affiliates	$	402,182	$	415,234

(1) As is customary within the real estate industry, the Company invests in certain projects through joint ventures. The Company provides funding for certain of its partners’ equity contributions. The most significant partnership for which the Company provides funding relates to Forest City Ratner Companies, representing the Commercial Group’s New York City operations and one unconsolidated project reported in the Residential Group. The Company consolidates the majority of its investments in these Commercial Group projects. The Company’s partner is the President and Chief Executive Officer of Forest City Ratner Companies and is the cousin to five executive officers of the Company. At October 31, 2005 and January 31, 2005, amounts advanced for projects on behalf of this partner, collateralized solely by each respective partnership interest were $55,862 and $63,213, respectively, of the $238,120 and $248,897 presented above for “Advances to partners and other affiliates.” These advances entitle the Company to a preferred return on and of the outstanding balances, which are payable solely from cash flows of each respective property, as well as a deficit restoration obligation provided by the partner.

Summarized financial information for the equity method investments is as follows:

	Combined (100%)						Pro-Rata Share
	(GAAP)						(Non-GAAP)
	October 31,			January 31,			October 31,			January 31,
	2005			2005			2005			2005
	(in thousands)						(in thousands)
Balance Sheet:
Completed rental properties	$	1,816,350		$	1,879,706		$	894,747		$	929,275
Projects under development		856,559			564,712			393,668			255,124
Land held for development or sale		194,038			177,080			103,742			93,755
Accumulated depreciation		(516,861	)		(497,566	)		(263,983	)		(255,221	)
Restricted cash		323,975			362,583			54,670			57,296
Other assets		515,708			542,567			102,379			112,273
Total Assets	$	3,189,769		$	3,029,082		$	1,285,223		$	1,192,502
Mortgage debt, nonrecourse	$	2,094,517		$	2,012,578		$	958,046		$	892,617
Other liabilities		478,173			396,834			163,115			133,548
Members’ and Partners’ equity		617,079			619,670			164,062			166,337
Total Liabilities and Members’/Partners’ Equity	$	3,189,769		$	3,029,082		$	1,285,223		$	1,192,502

26

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Investments in and Advances to Affiliates(continued)

	Combined (100%)						Pro-Rata Share
	(GAAP)						(non-GAAP)
Three Months Ended October 31,	2005			2004			2005			2004
				(in thousands)
Operations:
Revenues	$	169,052		$	140,565		$	81,644		$	67,448
Equity in earnings of unconsolidated entities on a pro-rata basis		—			—			1,380			2,191
Operating expenses		(101,352	)		(84,547	)		(49,633	)		(39,402	)
Interest expense		(24,747	)		(26,505	)		(12,283	)		(12,943	)
Depreciation and amortization		(16,239	)		(16,529	)		(7,579	)		(6,677	)
Interest income		214			2,340			58			156
Gain of disposition of operating properties(2)		4,094			—			2,526			—
Net Earnings (pre-tax)	$	31,022		$	15,324		$	16,113		$	10,773

	Combined (100%)						Pro-Rata Share
	(GAAP)						(non-GAAP)
Nine Months Ended October 31,	2005			2004			2005			2004
				(in thousands)
Operations:
Revenues	$	498,307		$	395,389		$	231,690		$	200,554
Equity in earnings of unconsolidated entities on a pro-rata basis		—			—			5,926			5,010
Operating expenses		(304,612	)		(230,080	)		(142,648	)		(118,097	)
Interest expense		(90,673	)		(75,477	)		(38,721	)		(37,722	)
Provision for decline in real estate		(704	)		—			(704	)		—
Depreciation and amortization		(74,494	)		(44,877	)		(31,042	)		(21,186	)
Interest income		7,164			2,977			505			116
Gain of disposition of operating properties(2)		85,802			61,427			21,023			31,996
Net Earnings (pre-tax)	$	120,790			109,359		$	46,029		$	60,671

(2) The following table shows the detail of gain on disposition of rental properties:

		Combined (100%)				Pro-Rata Share				Combined (100%)				Pro-Rata Share
		(GAAP)				(non-GAAP)				(GAAP)				(non-GAAP)
		Three Months Ended October 31,								Nine Months Ended October 31,
		2005		2004		2005		2004		2005		2004		2005		2004
		(in thousands)								(in thousands)
Flower Park Plaza (Apartments)	(Santa Ana, California)	$	4,094	$	—	$	2,526	$	—	$	4,094	$	—	$	2,526	$	—
Colony Place (Apartments)	(Fort Myers, Florida)		—		—		—		—		10,703		—		5,352		—
Showcase (Specialty Retail Center)	(Las Vegas, Nevada)		—		—		—		—		71,005		—		13,145		—
Chapel Hill Mall (Regional Mall)	(Akron, Ohio)		—		—		—		—		—		56,455		—		27,943
Chapel Hill Suburban (Specialty Retail Center)	(Akron, Ohio)		—		—		—		—		—		1,831		—		915
Manhattan Town Center Mall (Regional Mall)	(Manhattan, Kansas)		—		—		—		—		—		3,141		—		3,138
Total		$	4,094	$	—	$	2,526	$	—	$	85,802	$	61,427	$	21,023	$	31,996

Results of Operations

Net Earnings —Net earnings for the three months ended October 31, 2005 were $12,904,000 versus $37,340,000 for the three months ended October 31, 2004. This variance to prior year is primarily attributable to:

• Decrease of $18,979,000, net of tax and minority interest, related to the 2004 gains on disposition of three consolidated properties,Regency Towers, an apartment community located in Jackson, New Jersey,Pavilion,an office building located in San Jose, California andFlatbush Avenue, a specialty retail center in Brooklyn, New York;

27

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

• Decrease of $11,840,000, net of tax and minority interest, related to Stapleton Land, LLC’s retained interest in a trust. Of this amount, $11,811,000 was earned in 2004 but attributable to other comprehensive income (“OCI”) in previous fiscal years and deferred until 2004 under the cost recovery method;

• Increase in interest expense of $1,495,000, net of tax, as a result of the issuance of $150,000,000 senior notes in January of 2005;

• Decrease of $1,409,000 related to the Lumber Group net earnings in the third quarter of last year with no corresponding amount in the current quarter due to the sale of Lumber Group in November of 2004; and

• Increase in our current quarter loss of $1,335,000, net of tax, on our equity investment in the Nets, with third quarter 2004 results reflecting a shortened period as compared to the third quarter of 2005 due to the fact that the Nets investment closed on August 16, 2004.

These decreases were partially offset by the following increases:

• Increase of $5,814,000, net of tax, in earnings from the current quarter gains on disposition of two consolidated properties,Cherrywood VillageandRanchstone, apartment communities located in Denver, Colorado;

• Increase of $1,550,000, net of tax, related to the 2005 gain on disposition of the equity method propertyFlower Park Plaza, an apartment community located in Santa Ana, California;

• Increase of $4,649,000, net of tax and minority interest, related to land sales reported in the Land Development Group; and

• Increase of $3,760,000, net of tax and minority interest, in earnings from Commercial Group land sales primarily atSimi Valleyin Simi Valley, California, andWadsworthin Wadsworth, Ohio.

Net earnings for the nine months ended October 31, 2005 were $55,284,000 versus $79,366,000 for the nine months ended October 31, 2004. This variance to the prior year is primarily attributable to:

• Decrease of $31,457,000, net of tax and minority interest, related to the 2004 gains on disposition of five consolidated properties,Regency Towers,Woodlake, a 534-unit apartment community located in Silver Spring, Maryland,Pavilion, Flatbush Avenue, andHunting Park, a specialty retail center located in Philadelphia, Pennsylvania;

• Decrease of $6,441,000, net of tax, compared to the same period last year as a result of the 2005 dispositions of three equity method propertiesShowcase, a specialty retail center located in Las Vegas Nevada,Colony Place, an apartment community located in Fort Myers, Florida andFlower Park Plazaat a gain of $12,900,000, net of tax, which only partially offset prior year gains of $19,341,000, net of tax, due to the dispositions ofManhattan Town Center Mall, a regional mall located in Manhattan, Kansas,Chapel Hill Suburban, a specialty retail center located in Akron, Ohio andChapel Hill Mall, a regional mall located in Akron, Ohio;

• Decrease of $13,745,000, net of tax and minority interest, related to Stapleton Land, LLC’s retained interest in a trust. Of this amount, $12,445,000 was earned in 2004 but attributable to OCI in previous fiscal years and deferred until 2004 under the cost recovery method. The remaining amount of $1,300,000 was earned and recognized during the three months ended October 31, 2004;

• Increase of $9,443,000, net of tax, on our loss on our equity investment in the Nets which we did not own during the first half of 2004;

• Decrease of $4,284,000, net of tax and minority interest, related to our development fee revenue atTwelve MetroTech Centerin Brooklyn, New York that was recognized in the prior year and did not recur at the same level;

• Decrease of $5,764,000 related to the Lumber Group net earnings last year with no corresponding amount in the current year due to the sale of Lumber Group in November of 2004;

28

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

• Increase in interest expense of $4,486,000, net of tax, as a result of the issuance of $150,000,000 senior notes in January of 2005; and

• Increase of $1,856,000, net of tax, related to a write-off of a portion of our enterprise resource planning project.

These decreases were partially offset by the following increases:

• Increase of $21,722,000, net of tax and minority interest, related to the earnings from Commercial Group land sales primarily atSimi ValleyandWadsworth;

• Increase of $11,261,000, net of tax, related to the prior year charge for cumulative effect of change in accounting principle as a result of our implementation of FIN No. 46 (R) which did not recur;

• Increase of $10,616,000, net of tax and minority interest, related to land sales reported in the Land Development Group;

• Increase of approximately $10,000,000 related to a favorable change in our effective tax rate due to tax law changes in the State of Ohio resulting in a one-time reduction of deferred income taxes; and

• Increase of $5,814,000, net of tax, related to the 2005 gains on disposition of two consolidated residential properties,Cherrywood VillageandRanchstone.

Net Operating Income (NOI) from Real Estate Groups —NOI, a non-GAAP measure, is defined as revenues (excluding straight-line rent adjustments) less operating expenses (including depreciation and amortization for non-real estate groups) plus interest income plus equity in earnings of unconsolidated entities (excluding gain on disposition of equity method operating properties) plus equity method depreciation and amortization. We believe NOI provides us, as well as our investors, additional information about our core business operations and, along with earnings, is necessary to understand our business and operating results. Under the full consolidation method (GAAP), NOI from the combination of the Commercial Group and the Residential Group for the three months ended October 31, 2005 was $130,542,000 compared to $114,679,000 for the three months ended October 31, 2004, a 13.8% increase. NOI for the nine months ended October 31, 2005 was $403,627,000 versus $353,097,000 for the nine months ended October 31, 2004, a 14.3% increase. A reconciliation of NOI to the most comparable GAAP measure, net earnings, is presented on pages 8-9. A reconciliation of NOI to net earnings for each strategic business unit can be found on pages 33-46.

Management also analyzes property NOI using the pro-rata consolidation method because it provides operating data at our ownership share, and we publicly disclose and discuss our performance using this method of consolidation to complement our GAAP disclosures. Under the pro-rata consolidation method, NOI from the combination of the Commercial Group and the Residential Group for the three months ended October 31, 2005 was $128,825,000 compared to $119,544,000 for the three months ended October 31, 2004, a 7.8% increase. NOI from combination of the Commercial Group and the Residential Group for the nine months ended October 31, 2005 was $398,645,000 versus $356,476,000 for the nine months ended October 31, 2004, a 11.8% increase. This increase over the comparable period in the prior year is primarily attributable the gain on land sales in our Commercial Group of $35,644,000 in 2005, as well as NOI generated from new properties which include three residential communities, three office buildings and four retail centers opened during the year ended January 31, 2005. Comparable NOI increased 2.5% compared to an increase of 2.1% for the prior year. Comparable NOI for our retail portfolio is up 2.5% from the prior year and our residential portfolio has generated an increase of 3.6%.

EBDT— We use an additional measure, along with net earnings, to report our operating results. This non-GAAP measure, referred to as Earnings Before Depreciation, Amortization and Deferred Taxes (“EBDT”), is not a measure of operating results or cash flows from operations as defined by GAAP and may not be directly comparable to similarly-titled measures reported by other companies.

We believe that EBDT provides additional information about our core operations and, along with net earnings, is necessary to understand our operating results. EBDT is used by the chief operating decision maker and management in assessing operating performance and to consider capital requirements and allocation of resources by segment and on a consolidated basis. We believe EBDT is important to investors because it provides another method for the investor to measure our long-term operating performance as net earnings can vary from year to year due to property dispositions, acquisitions and other factors that have a short-term impact.

29

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

EBDT is defined as net earnings excluding the following items: i) gain (loss) on disposition of rental properties, divisions and other investments (net of tax); ii) the adjustment to recognize rental revenues and rental expense using the straight-line method; iii) non-cash charges from real estate operations of Forest City Rental Properties Corporation, a wholly-owned subsidiary of Forest City Enterprises, Inc., for depreciation, amortization, amortization of mortgage procurement costs and deferred income taxes; iv) provision for decline in real estate (net of tax); v) extraordinary items (net of tax); and vi) cumulative effect of change in accounting principle (net of tax). Unlike the real estate segments, EBDT for the Nets segment equals net earnings.

EBDT is reconciled to net earnings, the most comparable financial measure calculated in accordance with GAAP, below. The adjustment to recognize rental revenues and rental expenses on the straight-line method is excluded because it is management’s opinion that rental revenues and expenses should be recognized when due from the tenants or due to the landlord. We exclude depreciation and amortization expense related to real estate operations from EBDT because we believe the values of our properties, in general, have appreciated over time in excess of their original cost. Deferred taxes from real estate operations, which are the result of timing differences of certain net expense items deducted in a future year for federal income tax purposes, are excluded until the year in which they are reflected in our current tax provision. The provision for decline in real estate is excluded from EBDT because it varies from year to year based on factors unrelated to our overall financial performance and is related to the ultimate gain on dispositions of operating properties. Our EBDT may not be directly comparable to similarly-titled measures reported by other companies.

EBDT for the third quarter of 2005 was $64,300,000 or $0.63 per share, an $18,300,000 decrease, or 22.2% on a per share basis compared with third quarter 2004 EBDT of $82,600,000, or $0.81 per share. The decrease was primarily attributable to the receipt and recognition of the Stapleton financing income of $11,900,000 that was earned in previous fiscal years and deferred until 2004, a decrease in the Residential Group of $9,200,000 due to a decrease in the tax benefit as a result of fluctuations in taxable income of $5,200,000 and rent-up deficits at newly-opened properties, an increase in our interest expense as a result of our $150,000,000 senior note offering in January 2005 of $1,500,000, a decrease of $1,400,000 for Lumber Group representing EBDT in the third quarter of last year with no corresponding EBDT in 2005 and increased losses for the Nets of $1,300,000. These decreases were partially offset by decreased project write-offs of $4,300,000 and the sale of outlot land in our Commercial Group of $3,700,000.

On a year-to-date basis EBDT was $196,800,000 or $1.92 per share, an $11,900,000 decrease, or 6.3% on a per share basis versus the comparable period EBDT in 2004 of $208,700,000, or $2.05 per share. The decrease was primarily attributable to Stapleton financing income earned in prior years and recognized in 2004 of $12,400,000, a decrease in the Residential Group of $11,400,000 due to a decrease in the tax benefit as a result of fluctuations in taxable income of $2,600,000 and rent-up deficits on newly-opened properties, increased losses of $9,400,000 for The Nets which we did not own until August of 2004, a decrease of $5,800,000 for Lumber Group representing EBDT in 2004 with no corresponding EBDT in 2005, decreased development fee income related toTwelve MetroTechlocated in Brooklyn, New York of $4,300,000, and increased interest expense as a result of our $150,000,000 senior note offering in January 2005 of $4,500,000. These decreases were offset by the sale of outlot land, and a development project in our Commercial Group of $17,300,000, decreased project write-offs of $4,300,000, and the sale of land atTwelve MetroTechof $4,300,000 as well as land sales in our Land Development Group of $8,900,000.

Summary of EBDT— The information in the tables on pages 33-46 present amounts for both full consolidation and pro-rata consolidation, providing a reconciliation of the difference between the two methods, as well as reconciliation from NOI to EBDT to net earnings. Under the pro-rata consolidation method, we present our partnership investments proportionate to our pro-rata share for each line item of our consolidated financial statements. Under full consolidation, partnership assets and liabilities are reported as consolidated at 100% if deemed under our control or if we are deemed to be the primary beneficiary for investments in the VIEs, or on the equity method of accounting if we do not have control or are not the primary beneficiary for investments in VIEs.

30

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Reconciliation of Net Earnings to Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT)⁽²⁾

	Three Months Ended October 31,						Nine Months Ended October 31,
	2005			2004			2005			2004
	(in thousands)						(in thousands)
Net earnings	$	12,904		$	37,340		$	55,284			$	79,366
Depreciation and amortization — Real Estate Groups(5)		46,276			41,695			138,513				128,049
Depreciation and amortization — equity method investments(3)		—			—			—				237
Amortization of mortgage procurement costs — Real Estate Groups		3,026			3,372			8,659				9,685
Deferred income tax expense — Real Estate Groups(6)		12,906			34,540			17,892				65,949
Deferred income tax expense — Non Real-Estate Groups:(6)
Gain on disposition of other investments		—			—			174				—
Gain on disposition of Lumber Group		—			—			—				89
Current income tax expense on non-operating earnings:(6)
Gain on disposition of other investments		—			—			60				—
Gain on disposition included in discontinued operations		—			219			—				(140	)
Gain on disposition recorded on equity method		220			—			8,147				(209	)
Straight-line rent adjustment(4)		(1,200	)		(3,184	)		(6,183	)			(2,646	)
Provision for decline in real estate, net of minority interest		2,120			—			4,694				—
Provision for decline in real estate recorded on equity method		—			—			704				—
Gain on disposition recorded on equity method		(2,526	)		—			(21,023	)			(31,996	)
Gain on disposition of other investments		—			—			(606	)			—
Discontinued operations:(1)
Gain on disposition of rental properties		(9,476	)		(31,625	)		(9,476	)			(52,931	)
Loss on disposition of a division of Lumber Group		—			—			—				1,093
Minority interest — Gain on sale		—			228			—				894
Cumulative effect of change in accounting principle, net of tax		—			—			—				11,261
Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT)(2)	$	64,250		$	82,585		$	196,839			$	208,701

1)	Pursuant to the definition of a component of an entity of SFAS No. 144, assuming no significant continuing involvement, all earnings of properties and a division which have been sold or held for sale are reported as discontinued operations.
2)	The Company uses an additional measure, along with net earnings, to report its operating results. This measure, referred to as Earnings Before Depreciation, Amortization and Deferred Taxes (“EBDT”), is not a measure of operating results as defined by generally accepted accounting principles and may not be directly comparable to similarly-titled measures reported by other companies. The Company believes that EBDT provides additional information about its operations, and along with net earnings, is necessary to understand its operating results. EBDT is defined as net earnings excluding the following items: i) gain (loss) on disposition of operating properties, divisions and other investments (net of tax); ii) the adjustment to recognize rental revenues and rental expense using the straight-line method; iii) noncash charges from Forest City Rental Properties Corporation, a wholly-owned subsidiary of Forest City Enterprises, Inc., for depreciation, amortization (including amortization of mortgage procurement costs) and deferred income taxes; iv) provision for decline in real estate (net of tax); v) extraordinary items (net of tax); and vi) cumulative effect of change in accounting principle (net of tax).
3)	Amount represents depreciation expense for certain properties accounted for on the equity method of accounting under both full consolidation and pro-rata consolidation (a non-GAAP financial measure). See our discussion of pro-rata consolidation in the news release. See Investments in and Advances to Affiliates on pages 26-27 for discussion of these properties.
4)	The Company recognizes minimum rents on a straight-line basis over the term of the related lease pursuant to the provision of SFAS No. 13, “Accounting for Leases.” The straight-line rent adjustment is recorded as an increase or decrease to revenue from Forest City Rental Properties Corporation, a wholly-owned subsidiary of Forest City Enterprises, Inc., with the applicable offset to either accounts receivable or accounts payable, as appropriate.
5)	The following table provides detail of depreciation and amortization and amortization of mortgage procurement costs. The Company’s Real Estate Groups are owned by Forest City Rental Properties Corporation, a wholly-owned subsidiary engaged in the ownership, development, acquisition and management of real estate projects, including apartment complexes, regional malls and retail centers, hotels, office buildings and mixed-use facilities, as well as large land development projects.

	Depreciation and Amortization												Amortization of Mortgage Procurement Costs
	Three Months Ended						Nine Months Ended						Three Months Ended						Nine Months Ended
	Three Months Ended October 31,						Nine Months Ended October 31,						October 31,						October 31,
	2005			2004			2005			2004			2005			2004			2005			2004
Full Consolidation	$	44,008		$	37,190		$	130,383		$	111,252		$	3,564		$	3,764		$	10,326		$	10,773
Non-Real Estate Groups		(198	)		(288	)		(736	)		(869	)		(84	)		(41	)		(286	)		(140	)
Real Estate Groups Full Consolidation		43,810			36,902			129,647			110,383			3,480			3,723			10,040			10,633
Real Estate Groups related to minority interest		(3,828	)		(2,582	)		(11,822	)		(6,653	)		(757	)		(671	)		(2,302	)		(1,981	)
Real Estate Groups Equity Method		6,294			6,211			19,825			19,998			303			281			906			845
Real Estate Groups Discontinued Operations		—			1,164			863			4,321			—			39			15			188
Real Estate Groups Pro-Rata Consolidation	$	46,276		$	41,695		$	138,513		$	128,049		$	3,026		$	3,372		$	8,659		$	9,685

31

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Reconciliation of Net Earnings to Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT)⁽²⁾(continued)

(6) The following table provides detail of Income Tax Expense (Benefit):

			Three Months Ended October 31,						Nine Months Ended October 31,
			2005			2004			2005			2004
			(in thousands)						(in thousands)
(A	)	Operating earnings
		Current	$	(1,860	)	$	(9,005	)	$	(5,138	)	$	(9,909	)
		Deferred		8,875			20,742			17,820			34,108
				7,015			11,737			12,682			24,199
(B	)	Provision for decline in real estate
		Deferred		(819	)		—			(1,814	)		—
		Deferred-Equity method investment		—			—			(272	)		—
				(819	)		—			(2,086	)		—
(C	)	Gain on disposition of other investments
		Current — Non-Real Estate Groups		—			—			60			—
		Deferred — Real Estate Groups		—			—			174			—
				—			—			234			—
(D	)	Gain on disposition recorded on equity method
		Current		220			—			8,147			(209	)
		Deferred		755			—			(24	)		12,864
				975			—			8,123			12,655
		Subtotal (A) (B) (C) (D)
		Current		(1,640	)		(9,005	)		3,069			(10,118	)
		Deferred		8,811			20,742			15,884			46,972
		Income tax expense		7,171			11,737			18,953			36,854
(E	)	Discontinued operations — Rental Properties
		Operating earnings
		Current		(461	)		(543	)		(498	)		(265	)
		Deferred		7			364			(77	)		183
				(454	)		(179	)		(575	)		(82	)
		Gain on disposition of rental properties
		Current		—			219			—			381
		Deferred		3,662			12,199			3,662			20,199
				3,662			12,418			3,662			20,580
				3,208			12,239			3,087			20,498
		Subtotal (A) (B) (C) (D) (E)
		Current		(2,101	)		(9,329	)		2,571			(10,002	)
		Deferred		12,480			33,305			19,469			67,354
				10,379			23,976			22,040			57,352
(F	)	Discontinued operations — Lumber Group
		Operating earnings
		Current		—			2,289			—			4,212
		Deferred		—			(1,237	)		—			(117	)
				—			1,052			—			4,095
		Loss on disposition of a division of Lumber Group
		Current		—			—			—			(521	)
		Deferred		—			—			—			89
				—			—			—			(432	)
				—			1,052			—			3,663
		Subtotal (E)(F)		3,208			13,291			3,087			24,161
		Grand Total (A) (B) (C) (D) (E) (F)
		Current		(2,101	)		(7,040	)		2,571			(6,311	)
		Deferred		12,480			32,068			19,469			67,326
			$	10,379		$	25,028		$	22,040		$	61,015
		Recap of Grand Total:
		Real Estate Groups
		Current		1,147			(6,608	)		13,571			(3,222	)
		Deferred		12,906			34,540			17,892			65,949
				14,053			27,932			31,463			62,727
		Non-Real Estate Groups
		Current		(3,248	)		(432	)		(11,000	)		(3,089	)
		Deferred		(426	)		(2,472	)		1,577			1,377
				(3,674	)		(2,904	)		(9,423	)		(1,712	)
		Grand Total	$	10,379		$	25,028		$	22,040		$	61,015

32

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended October 31, 2005(in thousands)

	Commercial Group 2005														Residential Group 2005
						Plus															Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata			Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation			Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	217,285		$	24,623	$	23,440		$	—		$	216,102		$	56,184		$	3,813		$	30,672		$	165		$	83,208
Exclude straight-line rent adjustment		(3,202	)		—		—			—			(3,202	)		(43	)		—			—			—			(43	)
Adjusted revenues		214,083			24,623		23,440			—			212,900			56,141			3,813			30,672			165			83,165
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		117,070			12,709		13,659			—			118,020			37,303			2,486			17,546			274			52,637
Exclude straight-line rent adjustment		(2,045	)		—		—			—			(2,045	)		—			—			—			—			—
Adjusted operating expenses		115,025			12,709		13,659			—			115,975			37,303			2,486			17,546			274			52,637
Add interest income		1,067			294		(252	)		—			521			877			(12	)		218			100			1,207
											��
Add equity in earnings of unconsolidated entities		2,234			—		(2,394	)		—			(160	)		4,397			—			(4,593	)		—			(196	)
Remove gain on disposition recorded on equity method		—			—		—			—			—			(2,526	)		—			2,526			—			—
Add back equity method depreciation and amortization expense		2,717			—		(2,717	)		—			—			3,880			—			(3,880	)		—			—
Net operating income		105,076			12,208		4,418			—			97,286			25,466			1,315			7,397			(9	)		31,539
Interest expense, including early extinguishment of debt		44,255			5,904		4,418			—			42,769			13,943			1,807			7,397			1,165			20,698
Income tax expense (benefit)		1,823			—		—			—			1,823			(1,403	)		—			—			(461	)		(1,864	)
Minority interest in earnings before depreciation and amortization		6,304			6,304		—			—			—			(492	)		(492	)		—			—			—
Add: EBDT from discontinued operations		—			—		—			—			—			(713	)		—			—			713			—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	52,694		$	—	$	—		$	—		$	52,694		$	12,705		$	—		$	—		$	—		$	12,705
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	52,694		$	—	$	—		$	—		$	52,694		$	12,705		$	—		$	—		$	—		$	12,705
Depreciation and amortization — Real Estate Groups		(32,395	)		—		—			—			(32,395	)		(13,840	)		—			—			—			(13,840	)
Amortization of mortgage procurement costs — Real Estate Groups		(2,409	)		—		—			—			(2,409	)		(617	)		—			—			—			(617	)
Deferred taxes — Real Estate Groups		(6,388	)		—		—			—			(6,388	)		(91	)		—			—			7			(84	)
Straight-line rent adjustment		1,157			—		—			—			1,157			43			—			—			—			43
Gain on disposition of rental properties and other investments, net of tax		—			—		—			—			—			—			—			1,551			5,814			7,365
Provision for decline in real estate, net of tax and minority interest		—			—		—			—			—			(1,301	)		—			—			—			(1,301	)
Gain on disposition recorded on equity method, net of tax		—			—		—			—			—			1,551			—			(1,551	)		—			—
Discontinued operations, net of tax:
Deferred taxes — Real Estate Groups		—			—		—			—			—			7			—			—			(7	)		—
Gain on disposition of rental properties		—			—		—			—			—			5,814			—			—			(5,814	)		—
Net earnings	$	12,659		$	—	$	—		$	—		$	12,659		$	4,271		$	—		$	—		$	—		$	4,271

33

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended October 31, 2005(in thousands)(continued)

	Land Development Group 2005													The Nets 2005
						Plus													Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	17,767		$	1,404	$	25,005		$	—	$	41,368		$	—		$	—	$	2,527	$	—	$	2,527
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Adjusted revenues		17,767			1,404		25,005					41,368								2,527				2,527
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		11,392			697		13,580			—		24,275			—			—		5,830		—		5,830
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Adjusted operating expenses		11,392			697		13,580			—		24,275			—			—		5,830		—		5,830
Add interest income		2,685			254		40			—		2,471			—			—		52		—		52
Add equity in earnings of unconsolidated entities		13,263			—		(11,513	)		—		1,750			(3,781	)		—		3,767		—		(14	)
Remove gain on disposition recorded on equity method		—			—		—			—		—			—			—		—		—		—
Add back equity method depreciation and amortization expense		—			—		—			—		—			—			—		—		—		—
Net operating income		22,323			961		(48	)		—		21,314			(3,781	)		—		516		—		(3,265	)
Interest expense, including early extinguishment of debt		1,492			56		(48	)		—		1,388			—			—		516		—		516
Income tax expense (benefit)		5,446			—		—			—		5,446			(1,461	)		—		—		—		(1,461	)
Minority interest in earnings before depreciation and amortization		905			905		—			—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—		—			—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	14,480		$	—	$	—		$	—	$	14,480		$	(2,320	)	$	—	$	—	$	—	$	(2,320	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	14,480		$	—	$	—		$	—	$	14,480		$	(2,320	)	$	—	$	—	$	—	$	(2,320	)
Depreciation and amortization — Real Estate Groups		(41	)		—		—			—		(41	)		—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		(2,593	)		—		—			—		(2,593	)		—			—		—		—		—
Straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Gain on disposition of rental properties and other investments, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate, net of tax and minority interest		—			—		—			—		—			—			—		—		—		—
Gain on disposition recorded on equity method, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate recorded on equity method, net of tax		—			—		—			—		—			—			—		—		—		—
Discontinued operations, net of tax:
Deferred taxes — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Gain on disposition of rental properties		—			—		—			—		—			—			—		—		—		—
Net earnings	$	11,846		$	—	$	—		$	—	$	11,846		$	(2,320	)	$	—	$	—	$	—	$	(2,320	)

34

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended October 31, 2005(in thousands)(continued)

	Corporate Activities 2005												Total 2005
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	—	$	—	$	—		$	291,236		$	29,840	$	81,644		$	165		$	343,205
Exclude straight-line rent adjustment		—			—		—		—		—			(3,245	)		—		—			—			(3,245	)
Adjusted revenues		—			—		—		—		—			287,991			29,840		81,644			165			339,960
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		9,871			—		—		—		9,871			175,636			15,892		50,615			274			210,633
Exclude straight-line rent adjustment		—			—		—		—		—			(2,045	)		—		—			—			(2,045	)
Adjusted operating expenses		9,871			—		—		—		9,871			173,591			15,892		50,615			274			208,588
Add interest income		451			—		—		—		451			5,080			536		58			100			4,702
Add equity in earnings of unconsolidated entities		—			—		—		—		—			16,113			—		(14,733	)		—			1,380
Remove gain on disposition recorded on equity method		—			—		—		—		—			(2,526	)		—		2,526			—			—
Add back equity method depreciation and amortization expense		—			—		—		—		—			6,597			—		(6,597	)		—			—
Net operating income		(9,420	)		—		—		—		(9,420	)		139,664			14,484		12,283			(9	)		137,454
Interest expense, including early extinguishment of debt		10,580			—		—		—		10,580			70,270			7,767		12,283			1,165			75,951
Income tax expense (benefit)		(6,691	)		—		—		—		(6,691	)		(2,286	)		—		—			(461	)		(2,747	)
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			6,717			6,717		—			—			—
Add: EBDT from discontinued operations		—			—		—		—		—			(713	)		—		—			713			—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(13,309	)	$	—	$	—	$	—	$	(13,309	)	$	64,250		$	—	$	—		$	—		$	64,250
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(13,309	)	$	—	$	—	$	—	$	(13,309	)	$	64,250		$	—	$	—		$	—		$	64,250
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(46,276	)		—		—			—			(46,276	)
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(3,026	)		—		—			—			(3,026	)
Deferred taxes — Real Estate Groups		(243	)		—		—		—		(243	)		(9,315	)		—		—			7			(9,308	)
Straight-line rent adjustment		—			—		—		—		—			1,200			—		—			—			1,200
Gain on disposition of rental properties and other investments, net of tax		—			—		—		—		—			—			—		1,551			5,814			7,365
Provision for decline in real estate, net of tax and minority interest		—			—		—		—		—			(1,301	)		—		—			—			(1,301	)
Gain on disposition recorded on equity method, net of tax		—			—		—		—		—			1,551			—		(1,551	)		—			—
Discontinued operations, net of tax:
Deferred taxes — Real Estate Groups		—			—		—		—		—			7			—		—			(7	)		—
Gain on disposition of rental properties		—			—		—		—		—			5,814			—		—			(5,814	)		—
Net earnings	$	(13,552	)	$	—	$	—	$	—	$	(13,552	)	$	12,904		$	—	$	—		$	—		$	12,904

35

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Nine Months Ended October 31, 2005(in thousands)

	Commercial Group 2005													Residential Group 2005
						Plus														Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	670,822		$	77,711	$	73,309		$	—	$	666,420		$	163,487		$	11,499		$	91,247		$	3,209		$	246,444
Exclude straight-line rent adjustment		(11,960	)		—		—			—		(11,960	)		(29	)		—			—			—			(29	)
Adjusted revenues		658,862			77,711		73,309			—		654,460			163,458			11,499			91,247			3,209			246,415
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		358,678			38,945		41,023			—		360,756			107,765			7,721			51,128			1,682			152,854
Exclude straight-line rent adjustment		(5,806	)		—		—			—		(5,806	)		—			—			—			—			—
Adjusted operating expenses		352,872			38,945		41,023			—		354,950			107,765			7,721			51,128			1,682			152,854
Add interest income		3,328			589		(710	)		—		2,029			2,566			14			937			100			3,589
Add equity in earnings of unconsolidated entities		22,337			—		(22,105	)		—		232			13,301			—			(13,577	)		—			(276	)
Remove gain on disposition recorded on equity method		(13,145	)		—		13,145			—		—			(7,878	)		—			7,878			—			—
Add back provision for decline in real estate recorded on equity method		704			—		(704	)		—		—			—			—			—			—			—
Add back equity method depreciation and amortization expense		8,466			—		(8,466	)		—		—			12,265			—			(12,265	)		—			—
Net operating income		327,680			39,355		13,446			—		301,771			75,947			3,792			23,092			1,627			96,874
Interest expense, including early extinguishment of debt		137,644			18,637		13,446			—		132,453			38,380			4,090			23,092			2,236			59,618
Income tax expense (benefit)		9,083			—		—			—		9,083			(6,427	)		—			—			(498	)		(6,925	)
Minority interest in earnings before depreciation and amortization		20,718			20,718		—			—		—			(298	)		(298	)		—			—			—
Add: EBDT from discontinued operations		—			—		—			—		—			(111	)		—			—			111			—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	160,235		$	—	$	—		$	—	$	160,235		$	44,181		$	—		$	—		$	—		$	44,181
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	160,235		$	—	$	—		$	—	$	160,235		$	44,181		$	—		$	—		$	—		$	44,181
Depreciation and amortization — Real Estate Groups		(97,384	)		—		—			—		(97,384	)		(40,120	)		—			—			(863	)		(40,983	)
Amortization of mortgage procurement costs — Real Estate Groups		(6,695	)		—		—			—		(6,695	)		(1,949	)		—			—			(15	)		(1,964	)
Deferred taxes — Real Estate Groups		(11,823	)		—		—			—		(11,823	)		(744	)		—			—			(77	)		(821	)
Straight-line rent adjustment		6,154			—		—			—		6,154			29			—			—			—			29
Gain on disposition of rental properties and other investments, net of tax		—			—		8,064			—		8,064			—			—			4,836			5,814			10,650
Provision for decline in real estate, net of tax and minority interest		(920	)		—		(432	)		—		(1,352	)		(1,960	)		—			—			—			(1,960	)
Gain on disposition recorded on equity method, net of tax		8,064			—		(8,064	)		—		—			4,836			—			(4,836	)		—			—
Provision for decline in real estate recorded on equity method, net of tax		(432	)		—		432			—		—			—			—			—			—			—
Discontinued operations, net of tax:
Depreciation and amortization — Real Estate Groups		—			—		—			—		—			(863	)		—			—			863			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			(15	)		—			—			15			—
Deferred taxes — Real Estate Groups		—			—		—			—		—			(77	)		—			—			77			—
Gain on disposition of rental properties		—			—		—			—		—			5,814			—			—			(5,814	)		—
Net earnings	$	57,199		$	—	$	—		$	—	$	57,199		$	9,132		$	—		$	—		$	—		$	9,132

36

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Nine Months Ended October 31, 2005(in thousands)(continued)

	Land Development Group 2005													The Nets 2005
						Plus													Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	77,241		$	5,053	$	47,335		$	—	$	119,523		$	—		$	—	$	19,799	$	—	$	19,799
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Adjusted revenues		77,241			5,053		47,335			—		119,523			—			—		19,799		—		19,799
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		46,313			2,587		25,866			—		69,592			—			—		34,942		—		34,942
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Adjusted operating expenses		46,313			2,587		25,866			—		69,592			—			—		34,942		—		34,942
Add interest income		11,502			1,110		111			—		10,503			—			—		167		—		167
Add equity in earnings of unconsolidated entities		27,388			—		(21,389	)		—		5,999			(16,997	)		—		16,968		—		(29	)
Remove gain on disposition recorded on equity method		—			—		—			—		—			—			—		—		—		—
Add back provision for decline in real estate recorded on equity method		—			—		—			—		—			—			—		—		—		—
Add back equity method depreciation and amortization expense		—			—		—			—		—			—			—		—		—		—
Net operating income		69,818			3,576		191			—		66,433			(16,997	)		—		1,992		—		(15,005	)
Interest expense, including early extinguishment of debt		5,627			303		191			—		5,515			—			—		1,992		—		1,992
Income tax expense (benefit)		21,739			—		—			—		21,739			(6,569	)		—		—		—		(6,569	)
Minority interest in earnings before depreciation and amortization		3,273			3,273		—			—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—		—			—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	39,179		$	—	$	—		$	—	$	39,179		$	(10,428	)	$	—	$	—	$	—	$	(10,428	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	39,179		$	—	$	—		$	—	$	39,179		$	(10,428	)	$	—	$	—	$	—	$	(10,428	)
Depreciation and amortization — Real Estate Groups		(146	)		—		—			—		(146	)		—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		(1,633	)		—		—			—		(1,633	)		—			—		—		—		—
Straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Gain on disposition of rental properties and other investments, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate, net of tax and minority interest		—			—		—			—		—			—			—		—		—		—
Gain on disposition recorded on equity method, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate recorded on equity method, net of tax		—			—		—			—		—			—			—		—		—		—
Discontinued operations, net of tax:
Depreciation and amortization — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Gain on disposition of rental properties		—			—		—			—		—			—			—		—		—		—
Net earnings	$	37,400		$	—	$	—		$	—	$	37,400		$	(10,428	)	$	—	$	—	$	—	$	(10,428	)

37

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Nine Months Ended October 31, 2005(in thousands)(continued)

	Corporate Activities 2005												Total 2005
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	—	$	—	$	—		$	911,550		$	94,263	$	231,690		$	3,209		$	1,052,186
Exclude straight-line rent adjustment		—			—		—		—		—			(11,989	)		—		—			—			(11,989	)
Adjusted revenues		—			—		—		—		—			899,561			94,263		231,690			3,209			1,040,197
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		27,146			—		—		—		27,146			539,902			49,253		152,959			1,682			645,290
Exclude straight-line rent adjustment		—			—		—		—		—			(5,806	)		—		—			—			(5,806	)
Adjusted operating expenses		27,146			—		—		—		27,146			534,096			49,253		152,959			1,682			639,484
Add interest income		1,423			—		—		—		1,423			18,819			1,713		505			100			17,711
Add equity in earnings of unconsolidated entities		—			—		—		—		—			46,029			—		(40,103	)		—			5,926
Remove gain on disposition recorded on equity method		—			—		—		—		—			(21,023	)		—		21,023			—			—
Add back provision for decline in real estate recorded on equity method		—			—		—		—		—			704			—		(704	)		—			—
Add back equity method depreciation and amortization expense		—			—		—		—		—			20,731			—		(20,731	)		—			—
Net operating income		(25,723	)		—		—		—		(25,723	)		430,725			46,723		38,721			1,627			424,350
Interest expense, including early extinguishment of debt		32,166			—		—		—		32,166			213,817			23,030		38,721			2,236			231,744
Income tax expense (benefit)		(21,561	)		—		—		—		(21,561	)		(3,735	)		—		—			(498	)		(4,233	)
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			23,693			23,693		—			—			—
Add: EBDT from discontinued operations		—			—		—		—		—			(111	)		—		—			111			—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(36,328	)	$	—	$	—	$	—	$	(36,328	)	$	196,839		$	—	$	—		$	—		$	196,839
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(36,328	)	$	—	$	—	$	—	$	(36,328	)	$	196,839		$	—	$	—		$	—		$	196,839
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(137,650	)		—		—			(863	)		(138,513	)
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(8,644	)		—		—			(15	)		(8,659	)
Deferred taxes — Real Estate Groups		(2,063	)		—		—		—		(2,063	)		(16,263	)		—		—			(77	)		(16,340	)
Straight-line rent adjustment		—			—		—		—		—			6,183			—		—			—			6,183
Gain on disposition of rental properties and other investments, net of tax		372			—		—		—		372			372			—		12,900			5,814			19,086
Provision for decline in real estate, net of tax and minority interest		—			—		—		—		—			(2,880	)		—		(432	)		—			(3,312	)
Gain on disposition recorded on equity method, net of tax		—			—		—		—		—			12,900			—		(12,900	)		—			—
Provision for decline in real estate recorded on equity method, net of tax		—			—		—		—		—			(432	)		—		432			—			—
Discontinued operations, net of tax:
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(863	)		—		—			863			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(15	)		—		—			15			—
Deferred taxes — Real Estate Groups		—			—		—		—		—			(77	)		—		—			77			—
Gain on disposition of rental properties		—			—		—		—		—			5,814			—		—			(5,814	)		—
Net earnings	$	(38,019	)	$	—	$	—	$	—	$	(38,019	)	$	55,284		$	—	$	—		$	—		$	55,284

38

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended October 31, 2004(in thousands)

	Commercial Group 2004														Residential Group 2004
						Plus														Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	178,195		$	22,679	$	26,080		$	970		$	182,566		$	50,369		$	3,756	$	29,510		$	4,427		$	80,550
Exclude straight-line rent adjustment		(4,995	)		—		—			(202	)		(5,197	)		80			—		—			—			80
Adjusted revenues		173,200			22,679		26,080			768			177,369			50,449			3,756		29,510			4,427			80,630
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		96,068			13,823		14,634			422			97,301			32,680			2,613		16,022			2,385			48,474
Exclude straight-line rent adjustment		(1,942	)		—		—			9			(1,933	)		—			—		—			—			—
Adjusted operating expenses		94,126			13,823		14,634			431			95,368			32,680			2,613		16,022			2,385			48,474
Add interest income		3,672			71		(167	)		30			3,464			678			16		257			37			956
Add equity in earnings of unconsolidated entities		4,152			4		(3,739	)		—			409			2,842			—		(2,284	)		—			558
Add back equity method depreciation and amortization expense		2,621			—		(2,621	)		—			—			3,871			—		(3,871	)		—			—
Net operating income		89,519			8,931		4,919			367			85,874			25,160			1,159		7,590			2,079			33,670
Interest expense, including early extinguishment of debt		45,069			5,264		4,919			157			44,881			10,570			993		7,590			1,705			18,872
Income tax expense (benefit)		(8,003	)		—		—			(404	)		(8,407	)		(6,932	)		—		—			(139	)		(7,071	)
Minority interest in earnings before depreciation and amortization		3,667			3,667		—			—			—			166			166		—			—			—
Add: EBDT from discontinued operations		614			—		—			(614	)		—			513			—		—			(513	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	49,400		$	—	$	—		$	—		$	49,400		$	21,869		$	—	$	—		$	—		$	21,869
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	49,400		$	—	$	—		$	—		$	49,400		$	21,869		$	—	$	—		$	—		$	21,869
Depreciation and amortization — Real Estate Groups		(28,181	)		—		—			(183	)		(28,364	)		(12,309	)		—		—			(981	)		(13,290	)
Amortization of mortgage procurement costs — Real Estate Groups		(2,610	)		—		—			(27	)		(2,637	)		(723	)		—		—			(12	)		(735	)
Deferred taxes — Real Estate Groups		(13,545	)		—		—			(473	)		(14,018	)		(7,233	)		—		—			109			(7,124	)
Straight-line rent adjustment		3,053			—		—			211			3,264			(80	)		—		—			—			(80	)
Gain on disposition of rental properties and other investments, net of tax		—			—		—			3,631			3,631			—			—		—			15,348			15,348
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		(183	)		—		—			183			—			(981	)		—		—			981			—
Amortization of mortgage procurement costs — Real Estate Groups		(27	)		—		—			27			—			(12	)		—		—			12			—
Deferred taxes — Real Estate Groups		(473	)		—		—			473			—			109			—		—			(109	)		—
Straight-line rent adjustment		211			—		—			(211	)		—			—			—		—			—			—
Gain on disposition of rental properties		3,631			—		—			(3,631	)		—			15,348			—		—			(15,348	)		—
Net earnings	$	11,276		$	—	$	—		$	—		$	11,276		$	15,988		$	—	$	—		$	—		$	15,988

39

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended October 31, 2004(in thousands)(continued)

	Land Development Group 2004													Lumber Group 2004
						Plus												Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full		Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation		Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)		Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	21,749		$	1,504	$	11,838		$	—	$	32,083		$	—	$	—	$	—	$	—	$	—
Exclude straight-line rent adjustment		—			—		—			—		—			—		—		—		—		—
Adjusted revenues		21,749			1,504		11,838			—		32,083			—		—		—		—		—
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		10,914			691		7,391			—		17,614			—		—		—		—		—
Exclude straight-line rent adjustment		—			—		—			—		—			—		—		—		—		—
Adjusted operating expenses		10,914			691		7,391			—		17,614			—		—		—		—		—
Add interest income		24,552			2,449		20			—		22,123			—		—		—		—		—
Add equity in earnings of unconsolidated entities		5,413			—		(4,189	)		—		1,224			—		—		—		—		—
Add back equity method depreciation and amortization expense		—			—		—			—		—			—		—		—		—		—
Net operating income		40,800			3,262		278			—		37,816			—		—		—		—		—
Interest expense, including early extinguishment of debt		2,446			165		278			—		2,559			—		—		—		—		—
Income tax expense (benefit)		8,418			—		—			—		8,418			—		—		—		—		—
Minority interest in earnings before depreciation and amortization		3,097			3,097		—			—		—			—		—		—		—		—
Add: EBDT from discontinued operations		—			—		—			—		—			1,409		—		—		—		1,409
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	26,839		$	—	$	—		$	—	$	26,839		$	1,409	$	—	$	—	$	—	$	1,409
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	26,839		$	—	$	—		$	—	$	26,839		$	1,409	$	—	$	—	$	—	$	1,409
Depreciation and amortization — Real Estate Groups		(41	)		—		—			—		(41	)		—		—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—		—		—		—		—
Deferred taxes — Real Estate Groups		(5,558	)		—		—			—		(5,558	)		—		—		—		—		—
Straight-line rent adjustment		—			—		—			—		—			—		—		—		—		—
Gain on disposition of rental properties and other investments, net of tax		—			—		—			—		—			—		—		—		—		—
Gain on disposition recorded on equity method, net of tax		—			—		—			—		—			—		—		—		—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—			—		—			—		—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—		—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—			—		—			—		—		—		—		—
Straight-line rent adjustment		—			—		—			—		—			—		—		—		—		—
Gain on disposition of rental properties		—			—		—			—		—			—		—		—		—		—
Net earnings	$	21,240		$	—	$	—		$	—	$	21,240		$	1,409	$	—	$	—	$	—	$	1,409

40

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended October 31, 2004(in thousands)(continued)

	The Nets 2004												Corporate Activities 2004
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	20	$	—	$	20		$	4		$	—	$	—	$	—	$	4
Exclude straight-line rent adjustment		—			—		—		—		—			—			—		—		—		—
Adjusted revenues		—			—		20		—		20			4			—		—		—		4
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		—			—		1,540		—		1,540			9,360			—		—		—		9,360
Exclude straight-line rent adjustment		—			—		—		—		—			—			—		—		—		—
Adjusted operating expenses		—			—		1,540		—		1,540			9,360			—		—		—		9,360
Add interest income		—			—		46		—		46			5			—		—		—		5
Add equity in earnings of unconsolidated entities		(1,630	)		—		1,630		—		—			—			—		—		—		—
Add back equity method depreciation and amortization expense		—			—		—		—		—			—			—		—		—		—
Net operating income		(1,630	)		—		156		—		(1,474	)		(9,351	)		—		—		—		(9,351	)
Interest expense, including early extinguishment of debt		—			—		156		—		156			9,674			—		—		—		9,674
Income tax expense (benefit)		(645	)		—		—		—		(645	)		(3,078	)		—		—		—		(3,078	)
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—		—		—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(985	)	$	—	$	—	$	—	$	(985	)	$	(15,947	)	$	—	$	—	$	—	$	(15,947	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(985	)	$	—	$	—	$	—	$	(985	)	$	(15,947	)	$	—	$	—	$	—	$	(15,947	)
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—		—		—			4,359			—		—		—		4,359
Straight-line rent adjustment		—			—		—		—		—			—			—		—		—		—
Gain on disposition of rental properties and other investments, net of tax		—			—		—		—		—			—			—		—		—		—
Gain on disposition recorded on equity method, net of tax		—			—		—		—		—			—			—		—		—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Straight-line rent adjustment		—			—		—		—		—			—			—		—		—		—
Gain on disposition of rental properties		—			—		—		—		—			—			—		—		—		—
Net earnings	$	(985	)	$	—	$	—	$	—	$	(985	)	$	(11,588	)	$	—	$	—	$	—	$	(11,588	)

41

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended October 31, 2004(in thousands)(continued)

	Total 2004
						Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	250,317		$	27,939	$	67,448		$	5,397		$	295,223
Exclude straight-line rent adjustment		(4,915	)		—		—			(202	)		(5,117	)
Adjusted revenues		245,402			27,939		67,448			5,195			290,106
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		149,022			17,127		39,587			2,807			174,289
Exclude straight-line rent adjustment		(1,942	)		—		—			9			(1,933	)
Adjusted operating expenses		147,080			17,127		39,587			2,816			172,356
Add interest income		28,907			2,536		156			67			26,594
Add equity in earnings of unconsolidated entities		10,777			4		(8,582	)		—			2,191
Add back equity method depreciation and amortization expense		6,492			—		(6,492	)		—			—
Net operating income		144,498			13,352		12,943			2,446			146,535
Interest expense, including early extinguishment of debt		67,759			6,422		12,943			1,862			76,142
Income tax expense (benefit)		(10,240	)		—		—			(543	)		(10,783	)
Minority interest in earnings before depreciation and amortization		6,930			6,930		—			—			—
Add: EBDT from discontinued operations		2,536			—		—			(1,127	)		1,409
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	82,585		$	—	$	—		$	—		$	82,585
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	82,585		$	—	$	—		$	—		$	82,585
Depreciation and amortization — Real Estate Groups		(40,531	)		—		—			(1,164	)		(41,695	)
Amortization of mortgage procurement costs — Real Estate Groups		(3,333	)		—		—			(39	)		(3,372	)
Deferred taxes — Real Estate Groups		(21,977	)		—		—			(364	)		(22,341	)
Straight-line rent adjustment		2,973			—		—			211			3,184
Gain on disposition of rental properties and other investments, net of tax		—			—		—			18,979			18,979
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		(1,164	)		—		—			1,164			—
Amortization of mortgage procurement costs — Real Estate Groups		(39	)		—		—			39			—
Deferred taxes — Real Estate Groups		(364	)		—		—			364			—
Straight-line rent adjustment		211			—		—			(211	)		—
Gain on disposition of rental properties		18,979			—		—			(18,979	)		—
Net earnings	$	37,340		$	—	$	—		$	—		$	37,340

42

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Nine Months Ended October 31, 2004(in thousands)

	Commercial Group 2004														Residential Group 2004
						Plus														Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	534,234		$	92,296	$	76,908		$	6,165		$	525,011		$	145,608		$	10,927	$	87,965		$	14,493		$	237,139
Exclude straight-line rent adjustment		(10,200	)		—		—			(849	)		(11,049	)		148			—		—			—			148
Adjusted revenues		524,034			92,296		76,908			5,316			513,962			145,756			10,927		87,965			14,493			237,287
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		275,501			52,498		45,211			1,898			270,112			92,605			7,496		48,280			7,575			140,964
Exclude straight-line rent adjustment		(8,250	)		—		—			(5	)		(8,255	)		—			—		—			—			—
Adjusted operating expenses		267,251			52,498		45,211			1,893			261,857			92,605			7,496		48,280			7,575			140,964
Add interest income		4,886			738		(491	)		67			3,724			1,841			13		490			56			2,374
Add equity in earnings of unconsolidated entities		40,014			—		(38,920	)		—			1,094			7,338			—		(6,719	)		—			619
Remove gain on disposition recorded on equity method		(31,996	)		—		31,996			—			—			—			—		—			—			—
Add back equity method depreciation and amortization expense		8,868			—		(8,868	)		—			—			12,212			—		(11,975	)		—			237
Net operating income		278,555			40,536		15,414			3,490			256,923			74,542			3,444		21,481			6,974			99,553
Interest expense, including early extinguishment of debt		121,785			17,774		15,414			1,553			120,978			29,273			2,513		21,481			5,284			53,525
Income tax expense (benefit)		(4,708	)		—		—			(89	)		(4,797	)		(9,336	)		—		—			(176	)		(9,512	)
Minority interest in earnings before depreciation and amortization		22,762			22,762		—			—			—			931			931		—			—			—
Add: EBDT from discontinued operations		2,026			—		—			(2,026	)		—			1,866			—		—			(1,866	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	140,742		$	—	$	—		$	—		$	140,742		$	55,540		$	—	$	—		$	—		$	55,540
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	140,742		$	—	$	—		$	—		$	140,742		$	55,540		$	—	$	—		$	—		$	55,540
Depreciation and amortization — Real Estate Groups		(86,487	)		—		—			(814	)		(87,301	)		(37,487	)		—		—			(3,507	)		(40,994	)
Amortization of mortgage procurement costs — Real Estate Groups		(7,276	)		—		—			(138	)		(7,414	)		(2,221	)		—		—			(50	)		(2,271	)
Deferred taxes — Real Estate Groups		(22,472	)		—		—			(746	)		(23,218	)		(10,411	)		—		—			563			(9,848	)
Straight-line rent adjustment		1,950			—		—			844			2,794			(148	)		—		—			—			(148	)
Gain on disposition of rental properties and other investments, net of tax		—			—		—			4,322			4,322			—			—		—			27,135			27,135
Gain on disposition recorded on equity method, net of tax		19,341			—		—			—			19,341			—			—		—			—			—
Cumulative effect of change in accounting principle, net of tax		(477	)		—		—			—			(477	)		(10,784	)		—		—			—			(10,784	)
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		(814	)		—		—			814			—			(3,507	)		—		—			3,507			—
Amortization of mortgage procurement costs — Real Estate Groups		(138	)		—		—			138			—			(50	)		—		—			50			—
Deferred taxes — Real Estate Groups		(746	)		—		—			746			—			563			—		—			(563	)		—
Straight-line rent adjustment		844			—		—			(844	)		—			—			—		—			—			—
Loss on disposition of division of Lumber Group		—			—		—			—			—			—			—		—			—			—
Gain on disposition of rental properties		4,322			—		—			(4,322	)		—			27,135			—		—			(27,135	)		—
Net earnings	$	48,789		$	—	$	—		$	—		$	48,789		$	18,630		$	—	$	—		$	—		$	18,630

43

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Nine Months Ended October 31, 2004(in thousands)(continued)

	Land Development Group 2004													Lumber Group 2004
						Plus													Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated			Plus		Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)
Revenues from real estate operations	$	71,082		$	4,384	$	35,661		$	—	$	102,359		$	—		$	—	$	—		$	—	$	—
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—			—		—
Adjusted revenues		71,082			4,384		35,661			—		102,359			—			—		—			—		—
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		41,978			2,374		23,409			—		63,013			—			—		—			—		—
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—			—		—
Adjusted operating expenses		41,978			2,374		23,409			—		63,013			—			—		—			—		—
Add interest income		30,017			2,964		71			—		27,124			—			—		—			—		—
Add equity in earnings of unconsolidated entities		14,949			—		(11,652	)		—		3,297
Remove gain on disposition recorded on equity method		—			—		—			—		—			—			—		—			—		—
Add back equity method depreciation and amortization expense		—			—		—			—		—			—			—		—			—		—
																					��
Net operating income		74,070			4,974		671			—		69,767			—			—		—			—		—
Interest expense, including early extinguishment of debt		5,165			251		671			—		5,585			—			—		—			—		—
Income tax expense (benefit)		21,505			—		—			—		21,505			—			—		—			—		—
Minority interest in earnings before depreciation and amortization		4,723			4,723		—			—		—			—			—		—			—		—
Add: EBDT from discontinued operations		—			—		—			—		—			5,764			—		—			—		5,764
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	42,677		$	—	$	—		$	—	$	42,677		$	5,764		$	—	$	—		$	—	$	5,764
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	42,677		$	—	$	—		$	—	$	42,677		$	5,764		$	—	$	—		$	—	$	5,764
Depreciation and amortization — Real Estate Groups		9			—		—			—		9			—			—		—			—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—			—		—
Deferred taxes — Real Estate Groups		(3,998	)		—		—			—		(3,998	)		—			—		—			—		—
Straight-line rent adjustment		—			—		—			—		—			—			—		—			—		—
Gain on disposition of rental properties and other investments, net of tax		—			—		—			—		—			—			—		—			—		—
Gain on disposition recorded on equity method, net of tax		—			—		—			—		—			—			—		—			—		—
Cumulative effect of change in accounting principle, net of tax		—			—		—			—		—			—			—		—			—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—			—		—			—			—		—			—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—			—		—
Deferred taxes — Real Estate Groups		—			—		—			—		—			—			—		—			—		—
Straight-line rent adjustment		—			—		—			—		—			—			—		—			—		—
Loss on disposition of division of Lumber Group		—			—		—			—		—			(661	)		—		—			—		(661	)
Gain on disposition of rental properties		—			—		—			—		—			—			—		—			—		—
Net earnings	$	38,688		$	—	$	—		$	—	$	38,688		$	5,103		$	—	$	—		$	—	$	5,103

44

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Nine Months Ended October 31, 2004(in thousands)(continued)

	The Nets 2004												Corporate Activities 2004
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	20	$	—	$	20		$	4		$	—	$	—	$	—	$	4
Exclude straight-line rent adjustment		—			—		—		—		—			—			—		—		—		—
Adjusted revenues		—			—		20		—		20			4			—		—		—		4
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		—			—		1,540		—		1,540			23,557			—		—		—		23,557
Exclude straight-line rent adjustment		—			—		—		—		—			—			—		—		—		—
Adjusted operating expenses		—			—		1,540		—		1,540			23,557			—		—		—		23,557
Add interest income		—			—		46		—		46			99			—		—		—		99
Add equity in earnings of unconsolidated entities		(1,630	)		—		1,630		—		—			—			—		—		—		—
Remove gain on disposition recorded on equity method		—			—		—		—		—			—			—		—		—		—
Add back equity method depreciation and amortization expense		—			—		—		—		—			—			—		—		—		—
Net operating income		(1,630	)		—		156		—		(1,474	)		(23,454	)		—		—		—		(23,454	)
Interest expense, including early extinguishment of debt		—			—		156		—		156			26,903			—		—		—		26,903
Income tax expense (benefit)		(645	)		—		—		—		(645	)		(15,320	)		—		—		—		(15,320	)
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—		—		—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(985	)	$	—	$	—	$	—	$	(985	)	$	(35,037	)	$	—	$	—	$	—	$	(35,037	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(985	)	$	—	$	—	$	—	$	(985	)	$	(35,037	)	$	—	$	—	$	—	$	(35,037	)
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Amortization of mortgage procurement costs – Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—		—		—			4,178			—		—		—		4,178
Straight-line rent adjustment
Gain on disposition of rental properties and other investments, net of tax		—			—		—		—		—			—			—		—		—		—
Gain on disposition recorded on equity method, net of tax		—			—		—		—		—			—			—		—		—		—
Cumulative effect of change in accounting principle, net of tax		—			—		—		—		—			—			—		—		—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization – Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Amortization of mortgage procurement costs – Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Deferred taxes – Real Estate Groups		—			—		—		—		—			—			—		—		—		—
Straight-line rent adjustment		—			—		—		—		—			—			—		—		—		—
Loss on disposition of division of Lumber Group		—			—		—		—		—			—			—		—		—		—
Gain on disposition of rental properties		—			—		—		—		—			—			—		—		—		—
Net earnings	$	(985	)	$	—	$	—	$	—	$	(985	)	$	(30,859	)	$	—	$	—	$	—	$	(30,859	)

45

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Nine Months Ended October 31, 2004(in thousands)(continued)

	Total 2004
						Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	750,928		$	107,607	$	200,554		$	20,658		$	864,533
Exclude straight-line rent adjustment		(10,052	)		—		—			(849	)		(10,901	)
Adjusted revenues		740,876			107,607		200,554			19,809			853,632
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		433,641			62,368		118,440			9,473			499,186
Exclude straight-line rent adjustment		(8,250	)		—		—			(5	)		(8,255	)
Adjusted operating expenses		425,391			62,368		118,440			9,468			490,931
Add interest income		36,843			3,715		116			123			33,367
Add equity in earnings of unconsolidated entities		60,671			—		(55,661	)		—			5,010
Remove gain on disposition recorded on equity method		(31,996	)		—		31,996			—			—
Add back equity method depreciation and amortization expense		21,080			—		(20,843	)		—			237
Net operating income		402,083			48,954		37,722			10,464			401,315
Interest expense, including early extinguishment of debt		183,126			20,538		37,722			6,837			207,147
Income tax expense (benefit)		(8,504	)		—		—			(265	)		(8,769	)
Minority interest in earnings before depreciation and amortization		28,416			28,416		—			—			—
Add: EBDT from discontinued operations		9,656			—		—			(3,892	)		5,764
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	208,701		$	—	$	—		$	—		$	208,701
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	208,701		$	—	$	—		$	—		$	208,701
Depreciation and amortization — Real Estate Groups		(123,965	)		—		—			(4,321	)		(128,286	)
Amortization of mortgage procurement costs — Real Estate Groups		(9,497	)		—		—			(188	)		(9,685	)
Deferred taxes — Real Estate Groups		(32,703	)		—		—			(183	)		(32,886	)
Straight-line rent adjustment		1,802			—		—			844			2,646
Gain on disposition of rental properties and other investments, net of tax		—			—		—			31,457			31,457
Gain on disposition recorded on equity method, net of tax		19,341			—		—			—			19,341
Cumulative effect of change in accounting principle, net of tax		(11,261	)		—		—			—			(11,261	)
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		(4,321	)		—		—			4,321			—
Amortization of mortgage procurement costs — Real Estate Groups		(188	)		—		—			188			—
Deferred taxes — Real Estate Groups		(183	)		—		—			183			—
Straight-line rent adjustment		844			—		—			(844	)		—
Loss on disposition of division of Lumber Group		(661	)		—		—			—			(661	)
Gain on disposition of rental properties		31,457			—		—			(31,457	)		—
Net earnings	$	79,366		$	—	$	—		$	—		$	79,366

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