[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 2007
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from __________ to __________
Commission file number1-10899
Kimco Realty Corporation
(Exact name of registrant as specified in its charter)
Maryland
13-2744380
(State of incorporation)
(I.R.S. Employer Identification No.)
3333 New Hyde Park Road, New Hyde Park, NY 11042-0020
(Address of principal executive offices - zip code)
(516) 869-9000
(Registrant’s telephone number, including area code)
Securities Registered pursuant to Section 12(b) of the Act:
Title of each class
Name of each exchange on which registered
Common Stock, par value $.01 per share.
New York Stock Exchange
Depositary Shares, each representing one-tenth of a share of 6.65% Class F Cumulative Redeemable Preferred Stock, par value $1.00 per share.
New York Stock Exchange
Depositary Shares, each representing one-hundredth of a share of 7.75% Class G Cumulative Redeemable Preferred Stock, par value $1.00 per share.
New York Stock Exchange
Securities Registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes
[ X ]
No
[ ]
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
[ X ]
No
[ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the Registrant’s knowledge, in the definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ X ]
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12-b of the Exchange Act.
Large Accelerated Filer
[ X ]
Accelerated Filer
[ ]
Non-accelerated Filer
[ ]
Smaller Reporting Company
[ ]
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes
[ ]
No
[ X ]
The aggregate market value of the voting stock held by non-affiliates of the Registrant was approximately $8.4 billion based upon the closing price on the New York Stock Exchange for such stock on June 29, 2007.
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the Registrant's classes of common stock, as of the latest practicable date.
252,857,002 shares as of February 21, 2008.
Page 1 of 198
DOCUMENTS INCORPORATED BY REFERENCE
Part III incorporates certain information by reference to the Registrant's definitive proxy statement to be filed with respect to the Annual Meeting of Stockholders expected to be held on May 13, 2008.
Index to Exhibits begins on page 61.
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TABLE OF CONTENTS
Item No.
Form 10-K Report Page
PART I
1.
Business
4
1A.
Risk Factors
13
1B.
Unresolved Staff Comments
18
2.
Properties
18
3.
Legal Proceedings
20
4.
Submission of Matters to a Vote of Security Holders
20
Executive Officers of the Registrant
35
PART II
5.
Market for the Registrant’s Common Equity and Related Shareholder Matters
36
6.
Selected Financial Data
37
7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
39
7A.
Quantitative and Qualitative Disclosures About Market Risk
54
8.
Financial Statements and Supplementary Data
55
9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
55
9A.
Controls and Procedures
55
9B.
Other Information
56
PART III
10.
Directors and Executive Officers of the Registrant
59
11.
Executive Compensation
59
12.
Security Ownership of Certain Beneficial Owners and Management
59
13.
Certain Relationships and Related Transactions
59
14.
Principal Accountant Fees and Services
59
PART IV
15.
Exhibits, Financial Statements, Schedules and Reports on Form 8-K
60
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PART I
FORWARD-LOOKING STATEMENTS
This annual report on Form 10-K, together with other statements and information publicly disseminated by Kimco Realty Corporation (the "Company" or "Kimco") contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project" or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company’s control and which could materially affect actual results, performances or achievements. Factors which may cause actual results to differ materially from current expectations include, but are not limited to, (i) general economic and local real estate conditions, (ii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or general downturn in their business, (iii) financing risks, such as the inability to obtain equity, debt or other sources of financing on favorable terms, (iv) changes in governmental laws and regulations, (v) the level and volatility of interest rates and foreign currency exchange rates, (vi) the availability of suitable acquisition opportunities and (vii) increases in operating costs. Accordingly, there is no assurance that the Company’s expectations will be realized.
SHARE SPLIT
As of August 23, 2005, the Company effected a two-for-one split (the "Stock Split") of the Company’s common stock in the form of a stock dividend paid to stockholders of record on August 8, 2005. All common share and per common share data included in this annual report on Form 10-K and the accompanying Consolidated Financial Statements and Notes thereto have been adjusted to reflect this Stock Split.
Item 1. Business
General
Kimco Realty Corporation, a Maryland corporation, is one of the nation's largest owners and operators of neighborhood and community shopping centers. The terms "Kimco", the "Company", "we", "our" and "us" each refer to Kimco Realty Corporation and our subsidiaries unless the context indicates otherwise. The Company is a self-administered real estate investment trust ("REIT") and its management has owned and operated neighborhood and community shopping centers for over 45 years. The Company has not engaged, nor does it expect to retain, any REIT advisors in connection with the operation of its properties. As of December 31, 2007, the Company had interests in 1,973 properties, totaling approximately 183 million square feet of gross leasable area ("GLA") located in 45 states, Canada, Mexico, Puerto Rico and Chile. The Company’s ownership interests in real estate consist of its consolidated portfolio and in portfolios where the Company owns an economic interest, such as properties in the Company’s investment management programs, where the Company partners with institutional investors and also retains management (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K). The Company believes its portfolio of neighborhood and community shopping center properties is the largest (measured by GLA) currently held by any publicly traded REIT.
The Company's executive offices are located at 3333 New Hyde Park Road, New Hyde Park, New York 11042-0020 and its telephone number is (516) 869-9000. Unless the context indicates otherwise, the term the "Company" as used herein is intended to include all subsidiaries of the Company.
The Company’s web site is located athttp://www.kimcorealty.com. The information contained on our web site does not constitute part of this Annual Report on Form 10-K. On the Company’s web site you can obtain, free of charge, a copy of our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and
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amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act of 1934, as amended, as soon as reasonably practicable after we file such material electronically with, or furnish it to, the Securities and Exchange Commission (the "SEC").
History
The Company began operations through its predecessor, The Kimco Corporation, which was organized in 1966 upon the contribution of several shopping center properties owned by its principal stockholders. In 1973, these principals formed the Company as a Delaware corporation, and in 1985, the operations of The Kimco Corporation were merged into the Company. The Company completed its initial public stock offering (the "IPO") in November 1991, and commencing with its taxable year which began January 1, 1992, elected to qualify as a REIT in accordance with Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the "Code"). In 1994, the Company reorganized as a Maryland corporation.
The Company's growth through its first 15 years resulted primarily from the ground-up development and construction of its shopping centers. By 1981, the Company had assembled a portfolio of 77 properties that provided an established source of income and positioned the Company for an expansion of its asset base. At that time, the Company revised its growth strategy to focus on the acquisition of existing shopping centers and creating value through the redevelopment and re-tenanting of those properties. As a result of this strategy, a majority of the operating shopping centers added to the Company’s portfolio since 1981 have been through the acquisition of existing shopping centers.
During 1998, the Company, through a merger transaction, completed the acquisition of The Price REIT, Inc., a Maryland corporation, (the "Price REIT"). Prior to the merger, Price REIT was a self-administered and self-managed equity REIT that was primarily focused on the acquisition, development, management and redevelopment of large retail community shopping center properties concentrated in the western part of the United States. In connection with the merger, the Company acquired interests in 43 properties, located in 17 states. With the completion of the Price REIT merger, the Company expanded its presence in certain western states including Arizona, California and Washington. In addition, Price REIT had strong ground-up development capabilities. These development capabilities, coupled with the Company’s own construction management expertise, provide the Company the ability to pursue ground-up development opportunities on a selective basis.
Also during 1998, the Company formed Kimco Income REIT ("KIR"), an entity in which the Company held a 99.99% limited partnership interest. KIR was established for the purpose of investing in high-quality properties financed primarily with individual non-recourse mortgages. The Company believed that these properties were appropriate for financing with greater leverage than the Company traditionally used. At the time of formation, the Company contributed 19 properties to KIR, each encumbered by an individual non-recourse mortgage. During 1999, KIR sold a significant interest in the partnership to institutional investors, thus establishing the Company’s investment management program. The Company holds a 45.0% non-controlling limited partnership interest in KIR and accounts for its investment in KIR under the equity method of accounting. (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
The Company has expanded its investment management program through the establishment of other various institutional joint venture programs in which the Company has non-controlling interests ranging generally from 5% to 45%. The Company’s largest joint venture, Kimco Prudential Joint Venture ("KimPru"), was formed in 2006, in connection with the Pan Pacific Retail Properties Inc. ("Pan Pacific") merger transaction, with Prudential Real Estate Investors ("PREI"), which holds approximately $3.6 billion in assets. The Company earns management fees, acquisition fees, disposition fees and promoted interests based on value creation. As of December 31, 2007, the Company’s assets under management were valued at approximately $14.0 billion, comprising 441 properties. (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
In connection with the Tax Relief Extension Act of 1999 (the "RMA") which became effective January 1, 2001, the Company is permitted to participate in activities from which it was previously precluded in order to maintain its qualification as a REIT, so long as these activities are conducted in entities which elect to be treated as taxable subsidiaries under the Code, subject to certain limitations. As such, the Company, through its taxable REIT subsidiaries, is engaged in various retail real estate related opportunities, including (i) merchant building through its
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wholly-owned taxable REIT subsidiaries, including Kimco Developers, Inc. ("KDI"), which are primarily engaged in the ground-up development of neighborhood and community shopping centers and subsequent sale thereof upon completion (see Recent Developments - Ground-Up Development), (ii) retail real estate advisory and disposition services, which primarily focus on leasing and disposition strategies for real estate property interests of both healthy and distressed retailers and (iii) acting as an agent or principal in connection with tax-deferred exchange transactions. The Company will consider other investments through taxable REIT subsidiaries should suitable opportunities arise.
The Company has continued its geographic expansion with investments in Canada, Mexico, Puerto Rico and Chile. During October 2001, the Company formed the RioCan Venture ("RioCan Venture") with RioCan Real Estate Investment Trust ("RioCan", Canada’s largest publicly traded REIT measured by GLA) in which the Company has a 50% non-controlling interest, to acquire retail properties and development projects in Canada. The Company accounts for this investment under the equity method of accounting. The Company has expanded its presence in Canada with the establishment of other joint venture arrangements. During 2002, the Company, along with various strategic co-investment partners, began acquiring operating and development properties located in Mexico. During 2006, the Company acquired interests in shopping center properties located in Puerto Rico through joint ventures in which the Company holds controlling ownership interests. During 2007, the Company acquired an interest in four shopping center properties located in Chile through a joint venture in which the Company holds a non-controlling ownership interest. (See Notes 3 and 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
In addition, the Company continues to capitalize on its established expertise in retail real estate by establishing other ventures in which the Company owns a smaller equity interest and provides management, leasing and operational support for those properties. The Company also provides preferred equity capital for real estate entrepreneurs and provides real estate capital and advisory services to both healthy and distressed retailers. The Company also makes selective investments in secondary market opportunities where a security or other investment is, in management’s judgment, priced below the value of the underlying assets.
Investment and Operating Strategy
The Company's investment objective has been to increase cash flow, current income and, consequently, the value of its existing portfolio of properties and to seek continued growth through (i) the strategic re-tenanting, renovation and expansion of its existing centers and (ii) the selective acquisition of established income-producing real estate properties and properties requiring significant re-tenanting and redevelopment, primarily in neighborhood and community shopping centers in geographic regions in which the Company presently operates. The Company has and will continue to consider investments in other real estate sectors and in geographic markets where it does not presently operate should suitable opportunities arise.
The Company's neighborhood and community shopping center properties are designed to attract local area customers and typically are anchored by a discount department store, a supermarket or a drugstore tenant offering day-to-day necessities rather than high-priced luxury items. The Company may either purchase or lease income-producing properties in the future and may also participate with other entities in property ownership through partnerships, joint ventures or similar types of co-ownership. Equity investments may be subject to existing mortgage financing and/or other indebtedness. Financing or other indebtedness may be incurred simultaneously or subsequently in connection with such investments. Any such financing or indebtedness would have priority over the Company’s equity interest in such property. The Company may make loans to joint ventures in which it may or may not participate.
In addition to property or equity ownership, the Company provides property management services for fees relating to the management, leasing, operation, supervision and maintenance of real estate properties.
While the Company has historically held its properties for long-term investment and accordingly has placed strong emphasis on its ongoing program of regular maintenance, periodic renovation and capital improvement, it is possible that properties in the portfolio may be sold, in whole or in part, as circumstances warrant, subject to REIT qualification rules.
The Company seeks to reduce its operating and leasing risks through diversification achieved by the geographic distribution of its properties and a large tenant base. As of December 31, 2007, the Company's single largest
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neighborhood and community shopping center accounted for only 1.7% of the Company's annualized base rental revenues and only 0.8% of the Company’s total shopping center GLA. At December 31, 2007, the Company’s five largest tenants were The Home Depot, TJX Companies, Sears Holdings, Kohl’s and Wal-Mart, which represent approximately 3.2%, 2.8%, 2.3%, 2.0% and 1.9%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
In connection with the RMA, which became effective January 1, 2001, the Company has expanded its investment and operating strategy to include new real estate-related opportunities which the Company was precluded from previously in order to maintain its qualification as a REIT. As such, the Company has established a merchant building business through its wholly owned taxable REIT subsidiaries, which make selective acquisitions of land parcels for the ground-up development primarily of neighborhood and community shopping centers and subsequent sale thereof upon completion. Additionally, the Company has developed a business which specializes in providing capital, real estate advisory services and disposition services of real estate controlled by both healthy and distressed and/or bankrupt retailers. These services may include assistance with inventory and fixture liquidation in connection with going-out-of-business sales. The Company may participate with other entities in providing these advisory services through partnerships, joint ventures or other co-ownership arrangements. The Company, as a regular part of its investment strategy, will continue to actively seek investments for its taxable REIT subsidiaries.
The Company emphasizes equity real estate investments including preferred equity investments, but may, at its discretion, invest in mortgages, other real estate interests and other investments. The mortgages in which the Company may invest may be either first mortgages, junior mortgages or other mortgage-related securities. The Company provides mortgage financing to retailers with significant real estate assets, in the form of leasehold interests or fee-owned properties, where the Company believes the underlying value of the real estate collateral is in excess of its loan balance. In addition, the Company will acquire debt instruments at a discount in the secondary market where the Company believes the asset value of the enterprise is greater than the current value.
The Company may legally invest in the securities of other issuers, for the purpose, among others, of exercising control over such entities, subject to the gross income and asset tests necessary for REIT qualification. The Company may, on a selective basis, acquire all or substantially all securities or assets of other REITs or similar entities where such investments would be consistent with the Company’s investment policies. In any event, the Company does not intend that its investments in securities will require it to register as an "investment company" under the Investment Company Act of 1940.
The Company has authority to offer shares of capital stock or other senior securities in exchange for property and to repurchase or otherwise reacquire its common stock or any other securities and may engage in such activities in the future. At all times, the Company intends to make investments in such a manner as to be consistent with the requirements of the Code to qualify as a REIT unless, because of circumstances or changes in the Code (or in Treasury Regulations), the Board of Directors determines that it is no longer in the best interests of the Company to qualify as a REIT.
Capital Strategy and Resources
The Company intends to operate with and maintain a conservative capital structure with a level of debt to total market capitalization of approximately 50% or less. As of December 31, 2007, the Company’s level of debt to total market capitalization was 30%. In addition, the Company intends to maintain strong debt service coverage and fixed charge coverage ratios as part of its commitment to maintaining its investment-grade debt ratings. It is management's intention that the Company continually have access to the capital resources necessary to expand and develop its business. Accordingly, the Company may, from time-to-time, seek to obtain funds through additional common and preferred equity offerings, unsecured debt financings and/or mortgage/construction loan financings and other capital alternatives in a manner consistent with its intention to operate with a conservative debt structure.
Since the completion of the Company's IPO in 1991, the Company has utilized the public debt and equity markets as its principal source of capital for its expansion needs. Since the IPO, the Company has completed additional offerings of its public unsecured debt and equity, raising in the aggregate over $5.7 billion. Proceeds from public capital market
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activities have been used for repaying indebtedness, acquiring interests in neighborhood and community shopping centers, funding ground-up development projects, expanding and improving properties in the portfolio and other investments, among other things. The Company also has revolving credit facilities totaling approximately $1.8 billion available for general corporate purposes. At December 31, 2007 the Company had approximately $282.2 million outstanding on the facilities. In March 2006, the Company was added to the S & P 500 Index, an index containing the stock of 500 Large Cap companies, most of which are U.S. corporations. For further discussion regarding capital strategy and resources, see Management’s Discussion and Analysis of Results of Operations and Financial Condition - Financing Activities.
Competition
As one of the original participants in the growth of the shopping center industry and one of the nation's largest owners and operators of neighborhood and community shopping centers, the Company has established close relationships with a large number of major national and regional retailers and maintains a broad network of industry contacts. Management is associated with and/or actively participates in many shopping center and REIT industry organizations. Notwithstanding these relationships, there are numerous regional and local commercial developers, real estate companies, financial institutions and other investors who compete with the Company for the acquisition of properties and other investment opportunities and in seeking tenants who will lease space in the Company’s properties.
Operating Practices
Nearly all operating functions, including leasing, legal, construction, data processing, maintenance, finance and accounting, are administered by the Company from its executive offices in New Hyde Park, New York and supported by the Company’s regional offices. The Company believes it is critical to have a management presence in its principal areas of operation and accordingly, the Company maintains regional offices in various cities throughout the United States. As of December 31, 2007, a total of 682 persons are employed at the Company's executive and regional offices.
The Company's regional offices are generally staffed by a regional business leader and the operating personnel necessary to both function as local representatives for leasing and promotional purposes, to complement the corporate office’s administrative and accounting efforts and to ensure that property inspection and maintenance objectives are achieved. The regional offices are important in reducing the time necessary to respond to the needs of the Company's tenants. Leasing and maintenance personnel from the corporate office also conduct regular inspections of each shopping center.
As of December 31, 2007, the Company also employs a total of 44 persons at several of its larger properties in order to more effectively administer its maintenance and security responsibilities.
Qualification as a REIT
The Company has elected, commencing with its taxable year which began January 1, 1992, to qualify as a REIT under the Code. If, as the Company believes, it is organized and operates in such a manner so as to qualify and remain qualified as a REIT under the Code, the Company generally will not be subject to federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under the Code.
In connection with the RMA, the Company’s taxable subsidiaries may participate in activities from which the Company was previously precluded, subject to certain limitations. The primary activities of the Company’s taxable REIT subsidiaries during 2007 included, but were not limited to, (i) the ground-up development of shopping center properties and subsequent sale thereof upon completion (see Recent Developments - Ground-Up Development), (ii) real estate advisory and disposition services, including the Company’s investment in Albertson’s described below and (iii) acting as an agent or principal in connection with tax deferred exchange transactions. The Company was subject to federal and state income taxes on the income from these activities.
Recent Developments
The following describes the Company’s significant transactions completed during the year ended December 31, 2007. (See Notes 3, 4 and 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
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Operating Properties - -
Acquisitions - -
During 2007, the Company acquired, in separate transactions, 43 operating properties, comprising an aggregate 3.6 million square feet of GLA for an aggregate purchase price of approximately $1.0 billion, including the assumption of approximately $114.3 million of non-recourse mortgage debt encumbering nine of the properties.
Dispositions - -
During 2007, the Company (i) disposed of six operating properties and completed partial sales of three operating properties, in separate transactions, for an aggregate sales price of approximately $40.0 million, which resulted in an aggregate net gain of approximately $6.4 million, after income tax of approximately $1.6 million, and (ii) transferred one operating property, which was acquired in the first quarter of 2007, to a joint venture in which the Company holds a 15% non-controlling ownership interest for an aggregate price of approximately $4.5 million, which represented the net book value.
Additionally, during 2007, two consolidated joint ventures in which the Company had preferred equity investments disposed of, in separate transactions, their respective properties for an aggregate sales price of approximately $66.5 million. As a result of these capital transactions, the Company received approximately $22.1 million of profit participation, before minority interest of approximately $5.6 million. This profit participation has been recorded as income from other real estate investments and is reflected in Income from discontinued operating properties in the Company’s Consolidated Statements of Income.
Redevelopments -
The Company has an ongoing program to reformat and re-tenant its properties to maintain or enhance its competitive position in the marketplace. During 2007, the Company substantially completed the redevelopment and re-tenanting of various operating properties. The Company expended approximately $70.1 million in connection with these major redevelopments and re-tenanting projects during 2007. The Company is currently involved in redeveloping several other shopping centers in the existing portfolio. The Company anticipates its capital commitment toward these and other redevelopment projects will be approximately $90.0 million to $110.0 million during 2008.
Ground-Up Development -
The Company is engaged in ground-up development projects which consist of (i) merchant building through the Company’s wholly-owned taxable REIT subsidiaries, which develop neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) U.S. ground-up development projects which will be held as long-term investments by the Company and (iii) various ground-up development projects located in Mexico for long-term investment (see Recent Developments - International Real Estate Investments and Note 3 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K). The ground-up development projects generally have significant pre-leasing prior to the commencement of construction. As of December 31, 2007, the Company had in progress a total of 60 ground-up development projects including 27 merchant building projects, nine U.S. ground-up development projects, and 24 ground-up development projects located throughout Mexico.
Merchant Building -
As of December 31, 2007, the Company had in progress 27 merchant building projects located in 13 states. During 2007, the Company expended approximately $269.6 million in connection with the purchase of land and construction costs related to these projects and those sold during 2007. As part of the Company’s ongoing analysis of its merchant building projects, the Company has determined that for two of its projects, located in Jacksonville, FL and Anchorage, AK, the recoverable value will not exceed their estimated cost. This is primarily due to adverse changes in local market conditions and the uncertainty of those conditions in the future. As a result, the Company has recorded an aggregate pre-tax adjustment of property carrying value on these projects for the year ended December 31, 2007, of $8.5 million, representing the excess of the carrying values of the projects over their estimated fair values.
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The Company anticipates its capital commitment toward its merchant building projects will be approximately $200.0 million to $250.0 million during 2008. The proceeds from the sale of completed ground-up development projects during 2008, proceeds from construction loans and availability under the Company’s revolving lines of credit are expected to be sufficient to fund these anticipated capital requirements.
Acquisitions -
During 2007, the Company acquired six land parcels, in separate transactions, for an aggregate purchase price of approximately $69.8 million. The estimated project costs for these newly acquired parcels are approximately $95.2 million with completion dates ranging from October 2008 to June 2010.
During 2007, the Company obtained individual construction loans on five merchant building projects and assumed one loan in connection with the acquisition of a merchant building project. Additionally, the Company repaid construction loans on three merchant building projects. At December 31, 2007, total loan commitments on the Company’s 15 outstanding construction loans aggregated approximately $360.3 million of which approximately $245.9 million has been funded. These loans have scheduled maturities ranging from one month to 33 months (excluding any extension options which may be available to the Company) and bear interest at rates ranging from 6.78% to 7.48% at December 31, 2007.
Dispositions -
During 2007, the Company sold, in separate transactions, (i) four of its recently completed merchant building projects, (ii) 26 out-parcels, (iii) 74.3 acres of undeveloped land and (iv) completed partial sales of two projects, for an aggregate total proceeds of approximately $310.5 million and received approximately $3.3 million of proceeds from completed earn-out requirements on previously sold projects. These sales resulted in pre-tax gains of approximately $40.1 million.
U.S. Long-Term Investment Projects - -
During 2007, the Company expended approximately $7.7 million in connection with the purchase of undeveloped land in Union, NJ, which will be developed into a 0.2 million square foot retail center and approximately $21.5 million in connection with the purchase of three redevelopment properties located in Bronx, NY, which will be redeveloped into mixed-use residential/retail centers aggregating 0.1 million square feet.
As of December 31, 2007, the Company had in progress a total of nine U.S. long-term investment projects. The Company anticipates its capital commitment toward these projects will be approximately $60.0 million to $80.0 million during 2008. The proceeds from construction loans and availability under the Company’s revolving lines of credit are expected to be sufficient to fund these anticipated capital requirements.
Kimsouth -
During June 2006, Kimsouth, a consolidated taxable REIT subsidiary in which the Company holds a 92.5% controlling interest, contributed approximately $51.0 million to fund its 15% non-controlling interest in a newly formed joint venture with an investment group to acquire a portion of Albertson’s Inc. To maximize investment returns, the investment group’s strategy with respect to this joint venture, includes refinancing, selling selected stores and enhancing operations at the remaining stores. During 2007, this joint venture completed the disposition of certain operating stores and a refinancing of the remaining assets in the joint venture. As a result of these transactions Kimsouth received cash distributions of approximately $148.6 million. Kimsouth has a remaining capital commitment obligation to fund up to an additional $15.0 million for general purposes. Due to this remaining capital commitment, $15.0 million is included in Other liabilities in the Company’s Consolidated Balance Sheets.
During 2007, Kimsouth’s income from the Albertson’s joint venture aggregated approximately $49.6 million, net of income tax. This amount includes (i) an operating loss of approximately $15.1 million, net of an income tax benefit of approximately $10.1 million, (ii) distribution in excess of Kimsouth’s investment of approximately $10.4 million, net
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of income tax expense of approximately $6.9 million and (iii) an extraordinary gain of approximately $54.3 million, net of income tax expense of approximately $36.2 million, resulting from purchase price allocation adjustments. Additionally, the Company reduced the valuation allowance that was applied against the Kimsouth net operating losses ("NOLs") resulting in an income tax benefit of approximately $31.2 million. (See Notes 3 and 22 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
Additionally, during the year ended December 31, 2007, the Albertson’s joint venture acquired two operating properties for approximately $20.3 million, including the assumption of $18.5 million in non-recourse mortgage debt.
Investment and Advances in Real Estate Joint Ventures -
The Company has various institutional and non-institutional joint venture programs in which the Company has various non-controlling interests which are accounted for under the equity method of accounting. (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
Acquisitions -
During 2007, the Company acquired, in separate transactions, 171 operating properties, through joint ventures in which the Company has various non-controlling interests for an aggregate purchase price of approximately $1.7 billion, including the assumption of approximately $867.1 million of non-recourse mortgage debt encumbering 158 of the properties and $177.5 million in proceeds from unsecured credit facilities obtained by two of the joint ventures. The Company’s aggregate investment in these joint ventures was approximately $235.8 million.
Dispositions -
During 2007, joint ventures in which the Company has non-controlling interests disposed of, in separate transactions, (i) 44 properties for an aggregate sales price of approximately $1.3 billion resulting in an aggregate gain of approximately $145.0 million, of which the Company’s share was approximately $56.6 million and (ii) two vacant parcels of land for an aggregate sales price of $6.7 million, which represented their net book value.
Additionally, during 2007, joint ventures in which the Company has non-controlling interests transferred 17 operating properties for an aggregate sales price of approximately $825.2 million, including approximately $427.1 million of non-recourse mortgage debt, to newly formed joint ventures in which the Company holds 15% non-controlling ownership interests and manages. As a result of these transactions, the Company recognized profit participation of approximately $3.7 million and deferred its share of the gain related to its remaining ownership interest in the properties.
Also, during 2007, joint ventures in which the Company has non-controlling interests sold six operating properties to the Company for a sales price of approximately $151.9 million including the assumption of $50.3 million in non-recourse mortgage debt. The Company’s share of the gain related to these transactions has been deferred.
International Real Estate Investments -
Canadian Investments - -
During 2007, the Company acquired, in separate transactions, two operating properties located in Canada, through newly formed joint ventures in which the Company has non-controlling interests. These properties were acquired for an aggregate purchase price of approximately CAD $23.0 million (approximately USD $21.2 million). The Company’s aggregate investment in these joint ventures was approximately CAD $11.5 million (approximately USD $10.7 million).
During 2007, the Company provided, through five separate Canadian preferred equity investments, an aggregate of approximately CAD $28.0 million (approximately USD $27.6 million) to developers and owners of 17 real estate properties.
The Company generated equity in income from its unconsolidated Canadian investments in real estate joint ventures of approximately $22.5 million and $21.1 million during 2007 and 2006, respectively. In addition, income from other unconsolidated Canadian real estate investments was approximately $35.1 million and $13.9 million during 2007 and 2006, respectively.
11
Mexican Investments -
During 2007, the Company acquired, in separate transactions, 18 operating properties located in various cities throughout Mexico, comprising an aggregate 0.8 million square feet of GLA for an aggregate purchase price of approximately 1.0 billion Mexican Pesos ("MXP") (approximately USD $90.4 million). (See Note 3 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
During 2007, the Company transferred in separate transactions, 50% of its 100% interest in seven projects located in Juarez, Tecamac, Mexicali, Cuaulta, Ciudad Del Carmen, Tijuana and Rosarito, Mexico to a joint venture partner for approximately $48.3 million, which approximated their carrying values. As a result of these transactions, the Company has deconsolidated these entities and now accounts for its investments under the equity method of accounting.
During 2007, the Company acquired, in separate transactions, nine land parcels located in various cities throughout Mexico, for an aggregate purchase price of approximately MXP 1.1 billion (approximately USD $94.8 million). Seven of these land parcels will be developed into retail centers aggregating approximately 2.8 million square feet of GLA with a total estimated aggregate project cost of approximately MXP 2.3 billion (approximately USD $210.2 million).
During 2007, the Company acquired, through a newly formed joint venture in which the Company has a controlling ownership interest, a 0.3 million square foot development project in Neuvo Vallarta, Mexico, for a purchase price of approximately MXP 119.5 million (approximately USD $11.0 million). Total estimated project costs are approximately USD $28.3 million.
During 2007, the Company acquired, through a newly formed joint venture in which the Company has a non-controlling interest, a 0.1 million square foot development project in Mexico, for a purchase price of MXP 48.6 million (approximately USD $4.4 million). Total estimated project costs are approximately USD $14.4 million.
During 2007, the Company acquired, in separate transactions, 21 operating properties located in various cities throughout Mexico, through joint ventures in which the Company has non-controlling interests. These properties were acquired for an aggregate purchase price of approximately MXP 1.4 billion (approximately USD $128.7 million). The Company’s aggregate investment in these joint ventures was approximately MXP 701.5 million (approximately USD $64.4 million).
The Company recognized equity in income from its unconsolidated Mexican investments in real estate joint ventures of approximately $5.2 million and $11.8 million during 2007 and 2006, respectively.
The Company’s revenues from its consolidated Mexican subsidiaries aggregated approximately $8.5 million and $2.4 million during 2007 and 2006, respectively.
Chilean Investments - -
During April 2007, the Company acquired four operating properties located in Santiago, Chile, through a newly formed joint venture in which the Company has a non-controlling interest. These properties were acquired for an aggregate purchase price of approximately 8.7 billion Chilean Pesos ("CLP") (approximately USD $16.5 million), including the assumption of CLP 5.9 billion (approximately USD $11.1 million) of non-recourse mortgage debt. The Company’s aggregate investment in this joint venture is approximately CLP 1.6 billion (approximately USD $3.0 million). The Company recognized equity in income from this investment of approximately $0.1 million during 2007.
Other Real Estate Investments -
Preferred Equity Capital -
The Company maintains a Preferred Equity program, which provides capital to developers and owners of real estate properties. During 2007, the Company provided in separate transactions, an aggregate of approximately $103.6 million in investment capital to developers and owners of 61 real estate properties, including the Canadian investments described above. As of December 31, 2007, the Company’s net investment under the Preferred Equity program was
12
approximately $484.1 million relating to 258 properties. For the year ended December 31, 2007, the Company earned approximately $63.5 million, including $30.5 million of profit participation earned from 18 capital transactions from these investments.
Additionally, during July 2007, the Company invested approximately $81.7 million of preferred equity capital in a portfolio comprised of 403 net leased properties which are divided into 30 master leased pools with each pool leased to individual corporate operators. These properties consist of a diverse array of free-standing restaurants, fast food restaurants, convenience and auto parts stores. As of December 31, 2007 these properties were encumbered by third party loans aggregating approximately $433.0 million with interest rates ranging from 5.08% to 10.47% with a weighted average interest rate of 9.3% and maturities ranging from 1.4 years to 15.2 years.
Mortgages and Other Financing Receivables-
During 2007, the Company provided financing to six borrowers for an aggregate amount of up to approximately $96.9 million, of which $62.2 million was outstanding as of December 31, 2007. As of December 31, 2007, the Company has 30 loans with total commitments of up to $185.0 million of which approximately $152.4 million has been funded. Availability under the Company’s revolving credit facilities are expected to be sufficient to fund these commitments. (See Note 9 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
Financing Transactions -
For discussion regarding financing transactions relating to the Company’s unsecured notes, credit facilities, non-recourse mortgage debt, construction loans and preferred stock issuance, see Management’s Discussion and Analysis of Results of Operations and Financial Condition - Financing Activities and Contractual Obligations and Other Commitments. (See Notes 11, 12, 13 and 17 of the Notes to Consolidated Financial Statement included in this annual report on Form 10-K.)
Exchange Listings
The Company's common stock, Class F Depositary Shares and Class G Depositary Shares are traded on the NYSE under the trading symbols "KIM", "KIMprF" and “KIMprG”, respectively.
Item 1A. Risk Factors
We are subject to certain business risks including, among other factors, the following:
Loss of our tax status as a real estate investment trust could have significant adverse consequences to us and the value of our securities.
We have elected to be taxed as a REIT for federal income tax purposes under the Code. We currently intend to operate so as to qualify as a REIT and believe that our current organization and method of operation complies with the rules and regulations promulgated under the federal income tax code to enable us to qualify as a REIT.
Qualification as a REIT involves the application of highly technical and complex federal income tax code provisions for which there are only limited judicial and administrative interpretations. The determination of various factual matters and circumstances not entirely within our control may affect our ability to qualify as a REIT. New legislation, regulations, administrative interpretations or court decisions could significantly change the tax laws with respect to qualification as a REIT, the federal income tax consequences of such qualification or the desirability of an investment in a REIT relative to other investments. There can be no assurance that we have qualified or will continue to qualify as a REIT for tax purposes.
If we lose our REIT status, we will face serious tax consequences that will substantially reduce the funds available to pay dividends to stockholders. If we fail to qualify as a REIT:
·
we would not be allowed a deduction for distributions to stockholders in computing our taxable income and would be subject to federal income tax at regular corporate rates;
·
we could be subject to the federal alternative minimum tax and possibly increased state and local taxes;
13
·
unless we were entitled to relief under statutory provisions, we could not elect to be subject to tax as a REIT for four taxable years following the year during which we were disqualified; and
·
we would not be required to make distributions to stockholders.
As a result of all these factors, our failure to qualify as a REIT could impair our ability to expand our business and raise capital, and could adversely affect the value of our securities.
Adverse market conditions and competition may impede our ability to generate sufficient income to pay expenses and maintain properties.
The economic performance and value of our properties is subject to all of the risks associated with owning and operating real estate including:
·
changes in the national, regional and local economic climate;
·
local conditions, including an oversupply of, or a reduction in demand for, space in properties like those that we own;
·
the attractiveness of our properties to tenants;
·
the ability of tenants to pay rent;
·
competition from other available properties;
·
changes in market rental rates;
·
the need to periodically pay for costs to repair, renovate and re-let space;
·
changes in operating costs, including costs for maintenance, insurance and real estate taxes;
·
the fact that the expenses of owning and operating properties are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from the properties; and
·
changes in laws and governmental regulations, including those governing usage, zoning, the environment and taxes.
Downturns in the retailing industry likely will have a direct impact on our performance.
Our properties consist primarily of community and neighborhood shopping centers and other retail properties. Our performance therefore is linked to economic conditions in the market for retail space generally. The market for retail space could in the future be adversely affected by:
·
weakness in the national, regional and local economies;
·
the adverse financial condition of some large retailing companies;
·
ongoing consolidation in the retail sector;
·
the excess amount of retail space in a number of markets; and
·
increasing consumer purchases through catalogues and the internet.
Failure by any anchor tenant with leases in multiple locations to make rental payments to us because of a deterioration of its financial condition or otherwise, could impact our performance.
14
Our performance depends on our ability to collect rent from tenants. At any time, our tenants may experience a downturn in their business that may significantly weaken their financial condition. As a result, our tenants may delay a number of lease commencements, decline to extend or renew leases upon expiration, fail to make rental payments when due, close stores or declare bankruptcy. Any of these actions could result in the termination of the tenants’ leases and the loss of rental income attributable to the terminated leases. In addition, lease terminations by an anchor tenant or a failure by that anchor tenant to occupy the premises could result in lease terminations or reductions in rent by other tenants in the same shopping centers under the terms of some leases. In that event, we may be unable to re-lease the vacated space at attractive rents or at all. The occurrence of any of the situations described above, particularly if it involves a substantial tenant with leases in multiple locations, could impact our performance.
We may be unable to collect balances due from tenants in bankruptcy.
A tenant that files for bankruptcy protection may not continue to pay us rent. A bankruptcy filing by or relating to one of our tenants or a lease guarantor would bar all efforts by us to collect pre-bankruptcy debts from the tenant or the lease guarantor, or their property, unless the bankruptcy court permits us to do so. A tenant or lease guarantor bankruptcy could delay our efforts to collect past due balances under the relevant leases and could ultimately preclude collection of these sums. If a lease is rejected by a tenant in bankruptcy, we would have only a general unsecured claim for damages. As a result, it is likely that we would recover substantially less than the full value of any unsecured claims it holds, if at all.
We may be unable to sell our real estate property investments when appropriate or on favorable terms.
Real estate property investments are illiquid and generally cannot be disposed of quickly. In addition, the federal tax code imposes restrictions on a REIT’s ability to dispose of properties that are not applicable to other types of real estate companies. Therefore, we may not be able to vary its portfolio in response to economic or other conditions promptly or on favorable terms.
We may acquire or develop properties or acquire other real estate related companies and this may create risks.
We may acquire or develop properties or acquire other real estate related companies when we believe that an acquisition or development is consistent with our business strategies. We may not succeed in consummating desired acquisitions or in completing developments on time or within budget. We face competition in pursuing these acquisition or development opportunities that could increase our costs. When we do pursue a project or acquisition, we may not succeed in leasing newly developed or acquired properties at rents sufficient to cover the costs of acquisition or development and operations. Difficulties in integrating acquisitions may prove costly or time-consuming and could divert management’s attention. Acquisitions or developments in new markets or industries where we do not have the same level of market knowledge may result in poorer than anticipated performance. We may also abandon acquisition or development opportunities that it has begun pursuing and consequently fail to recover expenses already incurred and have devoted management time to a matter not consummated. Furthermore, our acquisitions of new properties or companies will expose us to the liabilities of those properties or companies, some of which we may not be aware at the time of acquisition. In addition, development of our existing properties presents similar risks.
There is a lack of operating history with respect to our recent acquisitions and development of properties and we may not succeed in the integration or management of additional properties.
These properties may have characteristics or deficiencies currently unknown to us that affect their value or revenue potential. It is also possible that the operating performance of these properties may decline under our management. As we acquire additional properties, we will be subject to risks associated with managing new properties, including lease-up and tenant retention. In addition, our ability to manage our growth effectively will require us to successfully integrate our new acquisitions into our existing management structure. We may not succeed with this integration or effectively manage additional properties. Also, newly acquired properties may not perform as expected.
We do not have exclusive control over our joint venture and preferred equity investments, such that we are unable to ensure that our objectives will be pursued.
15
We have invested in some cases as a co-venturer or partner in properties instead of owning directly. In these investments, we do not have exclusive control over the development, financing, leasing, management and other aspects of these investments. As a result, the co-venturer or partner might have interests or goals that are inconsistent with us, take action contrary to our interests or otherwise impede our objectives. The co-venturer or partner also might become insolvent or bankrupt.
We may not be able to recover our investments in our joint venture or preferred equity investments, which may result in losses to us.
Our joint venture and preferred equity investments generally own real estate properties for which the economic performance and value is subject to all the risks associated with owning and operating real estate as described above.
We have significant international operations that carry additional risks.
We invest in, and conduct operations outside the United States. The risks we face in international business operations include, but are not limited to:
·
currency risks, including currency fluctuations;
·
unexpected changes in legislative and regulatory requirements;
·
potential adverse tax burdens;
·
burdens of complying with different permitting standards, labor laws and a wide variety of foreign laws;
·
obstacles to the repatriation of earnings and cash;
·
regional, national and local political uncertainty;
·
economic slowdown and/or downturn in foreign markets;
·
difficulties in staffing and managing international operations; and
·
reduced protection for intellectual property in some countries.
Each of these risks might impact our cash flow or impair our ability to borrow funds, which ultimately could adversely affect our business, financial condition, operating results and cash flows.
We may be unable to obtain financing through the debt and equities market, which may have a material adverse effect on our growth strategy, our results of operations, and our financial condition.
Market conditions may make it difficult to obtain financing, and we cannot assure you that we will be able to obtain additional debt or equity financing or that we will be able to obtain it on favorable terms. The inability to obtain financing could have negative effects on our business, such as:
·
We could have difficulty acquiring or developing properties, which could materially adversely affect our business strategy;
·
Our liquidity could be adversely affected;
·
We may be unable to repay or refinance our indebtedness;
·
We may need to make higher interest and principal payments or sell some of our assets on unfavorable terms to fund our indebtedness; and
·
We may need to issue additional capital stock, which could further dilute the ownership of our existing shareholders.
Financial covenants to which we are subject may restrict our operating and acquisition activities.
Our revolving credit facilities and the indentures under which our senior unsecured debt is issued contain certain financial and operating covenants, including, among other things, certain coverage ratios, as well as limitations on our ability to incur debt, make dividend payments, sell all or substantially all of our assets and engage in mergers and consolidations and certain acquisitions. These covenants may restrict our ability to pursue certain business initiatives or certain acquisition transactions that might otherwise be advantageous. In addition, failure to meet any of the financial covenants could cause an event of default under and/or accelerate some or all of our indebtedness, which would have a material adverse effect on us.
We may be subject to environmental regulations.
Under various federal, state, and local laws, ordinances and regulations, we may be considered an owner or operator of real property and may be responsible for paying for the disposal or treatment of hazardous or toxic substances released on or in our property, as well as certain other potential costs which could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). This liability may be imposed whether or not we knew about, or was responsible for, the presence of hazardous or toxic substances.
We face competition in leasing or developing properties.
16
We face competition in the acquisition, development, operation and sale of real property from others engaged in real estate investment. Some of these competitors have greater financial resources than us. This results in competition for the acquisition of properties for tenants who lease or consider leasing space in our existing and subsequently acquired properties and for other real estate investment opportunities.
Changes in market conditions could adversely affect the market price of our publicly traded securities.
As with other publicly traded securities, the market price of our publicly traded securities depends on various market conditions, which may change from time-to-time. Among the market conditions that may affect the market price of our publicly traded securities are the following:
·
the extent of institutional investor interest in us;
·
the reputation of REITs generally and the reputation of REITs with portfolios similar to us;
·
the attractiveness of the securities of REITs in comparison to securities issued by other entities (including securities issued by other real estate companies);
·
our financial condition and performance;
·
the market’s perception of our growth potential and potential future cash dividends;
·
an increase in market interest rates, which may lead prospective investors to demand a higher distribution rate in relation to the price paid for our shares; and
·
general economic and financial market conditions.
We may not be able to recover our investments in marketable securities or mortgage receivables, which may result in losses to us.
Our investments in marketable securities are subject to specific risks relating to the particular issuer of the securities, including the financial condition and business outlook of the issuer, which may result in losses to us. Marketable securities are generally unsecured and may also be subordinated to other obligations of the issuer. As a result, investments in marketable securities are subject to risks of:
·
limited liquidity in the secondary trading market;
·
substantial market price volatility resulting from changes in prevailing interest rates;
·
subordination to the prior claims of banks and other senior lenders to the issuer;
·
the possibility that earnings of the issuer may be insufficient to meet its debt service and distribution obligations; and
·
the declining creditworthiness and potential for insolvency of the issuer during periods of rising interest rates and economic downturn.
These risks may adversely affect the value of outstanding marketable securities and the ability of the issuers to make distribution payments.
We invest in mortgage receivables. Our investments in mortgage receivables normally are not insured or otherwise guaranteed by any institution or agency. In the event of a default by a borrower it may be necessary for us to foreclose our mortgage or engage in costly negotiations. Delays in liquidating defaulted mortgage loans and repossessing and selling the underlying properties could reduce our investment returns. Furthermore, in the event of default, the actual value of the property securing the mortgage may decrease. A decline in real estate values will adversely affect the value of our loans and the value of the mortgages securing our loans.
17
Our mortgage receivables may be or become subordinated to mechanics' or materialmen's liens or property tax liens. In these instances we may need to protect a particular investment by making payments to maintain the current status of a prior lien or discharge it entirely. In these cases, the total amount we recover may be less than our total investment, resulting in a loss. In the event of a major loan default or several loan defaults resulting in losses, our investments in mortgage receivables would be materially and adversely affected.
Item 1B. Unresolved Staff Comments
None
Item 2. Properties
Real Estate Portfolio As of December 31, 2007, the Company's real estate portfolio was comprised of interests in approximately 154.6 million square feet of GLA in 1,391 operating properties primarily consisting of neighborhood and community shopping centers, and 19 retail store leases located in 45 states, Canada, Mexico, Puerto Rico and Chile. This 154.6 million square feet of GLA does not include 17 properties under development comprising 2.5 million square feet of GLA related to the Preferred Equity program, 30 property interest comprising 0.6 million square feet of GLA related to FNC Realty, 401 property interests comprising 2.3 million square feet of GLA related to a net lease portfolio, 55 property interest comprising 2.8 million square feet of GLA related to the NewKirk Portfolio and 20.5 million square feet of planned GLA for 60 ground-up development projects. The Company’s portfolio includes interests ranging from 5% to 50% in 471 shopping center properties comprising approximately 72.4 million square feet of GLA relating to the Company’s investment management programs and other joint ventures. Neighborhood and community shopping centers comprise the primary focus of the Company's current portfolio. As of December 31, 2007, the Company’s total shopping center portfolio, representing 100% of total GLA of 124.0 million from 886 properties, was approximately 96.3% leased.
The Company's neighborhood and community shopping center properties, which are generally owned and operated through subsidiaries or joint ventures, had an average size of approximately 140,000 square feet as of December 31, 2007. The Company generally retains its shopping centers for long-term investment and consequently pursues a program of regular physical maintenance together with major renovations and refurbishing to preserve and increase the value of its properties. These projects usually include renovating existing facades, installing uniform signage, resurfacing parking lots and enhancing parking lot lighting. During 2007, the Company capitalized approximately $9.1 million in connection with these property improvements and expensed to operations approximately $19.7 million.
The Company's neighborhood and community shopping centers are usually "anchored" by a national or regional discount department store, supermarket or drugstore. As one of the original participants in the growth of the shopping center industry and one of the nation's largest owners and operators of shopping centers, the Company has established close relationships with a large number of major national and regional retailers. Some of the major national and regional companies that are tenants in the Company's shopping center properties include The Home Depot, TJX Companies, Sears Holdings, Kohl’s, Wal-Mart, Best Buy, Linens N Things, Royal Ahold, Bed Bath and Beyond, and Costco.
A substantial portion of the Company's income consists of rent received under long-term leases. Most of the leases provide for the payment of fixed-base rentals monthly in advance and for the payment by tenants of an allocable share of the real estate taxes, insurance, utilities and common area maintenance expenses incurred in operating the shopping centers. Although many of the leases require the Company to make roof and structural repairs as needed, a number of tenant leases place that responsibility on the tenant, and the Company's standard small store lease provides for roof repairs to be reimbursed by the tenant as part of common area maintenance. The Company's management places a strong emphasis on sound construction and safety at its properties.
Approximately 24.3% of the Company's leases also contain provisions requiring the payment of additional rent calculated as a percentage of tenants’ gross sales above predetermined thresholds. Percentage rents accounted for less than 1% of the Company's revenues from rental property for the year ended December 31, 2007.
Minimum base rental revenues and operating expense reimbursements accounted for approximately 99% of the Company's total revenues from rental property for the year ended December 31, 2007. The Company's management believes that the base rent per leased square foot for many of the Company's existing leases is generally lower than the prevailing market-rate base rents in the geographic regions where the Company operates, reflecting the potential for future growth.
18
For the period January 1, 2007 to December 31, 2007, the Company increased the average base rent per leased square foot in its consolidated portfolio of neighborhood and community shopping centers from $9.86 to $10.30, an increase of $0.44. This increase primarily consists of (i) a $0.25 increase relating to acquisitions, (ii) a $0.07 increase relating to dispositions or the transfer of properties to various joint venture entities and (iii) a $0.12 increase relating to new leases signed net of leases vacated and rent step-ups within the portfolio. As of December 31, 2007, the Company’s consolidated portfolio was 95.9% leased.
The Company seeks to reduce its operating and leasing risks through geographic and tenant diversity. No single neighborhood and community shopping center accounted for more than 0.8% of the Company's total shopping center GLA or more than 1.7% of total annualized base rental revenues as of December 31, 2007. The Company’s five largest tenants at December 31, 2007, were The Home Depot, TJX Companies, Sears Holdings, Kohl’s and Wal-Mart, which represent approximately 3.2%, 2.8%, 2.3%, 2.0% and 1.9%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest. The Company maintains an active leasing and capital improvement program that, combined with the high quality of the locations, has made, in management's opinion, the Company's properties attractive to tenants.
The Company's management believes its experience in the real estate industry and its relationships with numerous national and regional tenants gives it an advantage in an industry where ownership is fragmented among a large number of property owners.
Retail Store Leases In addition to neighborhood and community shopping centers, as of December 31, 2007, the Company had interests in retail store leases totaling approximately 1.8 million square feet of anchor stores in 19 neighborhood and community shopping centers located in 13 states. As of December 31, 2007, approximately 97.4% of the space in these anchor stores had been sublet to retailers that lease the stores under net lease agreements providing for average annualized base rental payments of $4.09 per square foot. The average annualized base rental payments under the Company’s retail store leases to the landowners of such subleased stores are approximately $2.54 per square foot. The average remaining primary term of the retail store leases (and, similarly, the remaining primary term of the sublease agreements with the tenants currently leasing such space) is approximately two years, excluding options to renew the leases for terms which generally range from five years to 20 years. The Company’s investment in retail store leases is included in the caption Other real estate investments on the Company’s Consolidated Balance Sheets.
Ground-Leased Properties The Company has interests in 79 shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land to the Company (or an affiliated joint venture) to construct and/or operate a shopping center. The Company or the joint venture pays rent for the use of the land and generally is responsible for all costs and expenses associated with the building and improvements. At the end of these long-term leases, unless extended, the land together with all improvements revert to the landowner.
Ground-Up Development Properties The Company is engaged in ground-up development projects which consists of (i) merchant building through the Company’s wholly-owned taxable REIT subsidiaries, which develop neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) U.S. ground-up development projects which will be held as long-term investments by the Company and (iii) various ground-up development projects located in Mexico for long-term investment (see Recent Developments - International Real Estate Investments and Note 3 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K). The ground-up development projects generally have significant pre-leasing prior to the commencement of the construction. As of December 31, 2007, the Company had in progress a total of 60 ground-up development projects including 27 merchant building projects, nine U.S. ground-up development projects and 24 ground-up development projects located throughout Mexico.
As of December 31, 2007, the Company had in progress 27 merchant building projects located in 13 states, which are expected to be sold upon completion. These projects had significant pre-leasing prior to the commencement of construction. As of December 31, 2007, the average annual base rent per leased square foot for the merchant building portfolio was $16.48 and the average annual base rent per leased square foot for new leases executed in 2007 was $18.19.
Undeveloped Land The Company owns certain unimproved land tracts and parcels of land adjacent to certain of its existing shopping centers that are held for possible expansion. At times, should circumstances warrant, the Company may develop or dispose of these parcels.
19
The table on pages 21 through 33 sets forth more specific information with respect to each of the Company's property interests.
Item 3. Legal Proceedings
The Company is not presently involved in any litigation nor, to its knowledge, is any litigation threatened against the Company or its subsidiaries that, in management's opinion, would result in any material adverse effect on the Company's ownership, management or operation of its properties taken as a whole, or which is not covered by the Company's liability insurance.
Item 4. Submission of Matters to a Vote of Security Holders
None.
20
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
ALABAMA
HOOVER
2000
FEE
11.5
115,347
100.0
WAL-MART
2025
2095
HOOVER (4)
2007
JOINT VENTURE
163.9
20,000
100.0
MOBILE (12)
1986
JOINT VENTURE
48.8
319,164
90.9
ACADEMY SPORTS & OUTDOORS
2021
2031
ROSS DRESS FOR LESS
2015
2035
MARSHALLS
2010
2017
ALASKA
ANCHORAGE (4)
2006
JOINT VENTURE
24.6
98,000
100.0
MICHAELS
2017
2037
BED BATH & BEYOND
2018
2038
OLD NAVY
2012
2018
KENAI
2003
JOINT VENTURE
14.7
146,759
100.0
HOME DEPOT
2018
2048
ARIZONA
GLENDALE
2007
FEE
16.5
96,337
98.0
MOR FURNITURE FOR LESS
2016
MICHAELS
2013
2018
ANNA'S LINENS
2015
2025
GLENDALE (7)
1998
JOINT VENTURE
40.5
333,388
98.9
COSTCO
2011
2046
FLOOR & DECOR
2015
2025
LEVITZ
2008
GLENDALE (9)
2004
FEE
6.4
70,428
100.0
SAFEWAY
2016
2046
MARANA
2003
FEE
18.2
191,008
100.0
LOWE'S HOME CENTER
2019
2069
MESA
1998
FEE
19.8
144,617
85.1
ROSS DRESS FOR LESS
2010
2015
CINE MANIA
2014
2019
BLACK ANGUS
2010
2015
MESA (4)
2005
GROUND LEASE (2078)/ JOINT VENTURE
6.1
1,004,000
100.0
WAL-MART
2027
2077
BASS PRO SHOPS
2027
2057
HOME DEPOT
2028
2058
MESA (9)
2004
FEE
29.4
307,375
84.4
SPORTS AUTHORITY
2016
2046
CIRCUIT CITY
2016
2036
MICHAELS
2010
2025
NORTH PHOENIX
1998
FEE
17.0
230,164
100.0
BURLINGTON COAT FACTORY
2013
2023
GUITAR CENTER
2017
2027
MICHAELS
2012
2022
PHOENIX
1998
JOINT VENTURE
1.6
16,410
100.0
CHAPMAN BMW
2016
2031
PHOENIX
1998
FEE
13.4
153,180
98.1
HOME DEPOT
2020
2050
JO-ANN FABRICS
2010
2025
PHOENIX (3)
1998
FEE
26.6
339,342
90.1
COSTCO
2011
2041
PHOENIX RANCH MARKET
2021
2041
FAMSA
2022
2032
PHOENIX
1997
FEE
17.5
131,621
97.0
SAFEWAY
2014
2039
TRADER JOE'S
2014
2029
PHOENIX (6)
2006
FEE
9.4
94,379
66.7
DOLLAR TREE
2012
2017
SURPRISE (4)
2004
JOINT VENTURE
94.4
-
-
SURPRISE (4)
2004
JOINT VENTURE
19.0
6,000
100.0
TUCSON
2003
JOINT VENTURE
17.8
190,174
100.0
LOWE'S HOME CENTER
2019
2069
CALIFORNIA
ALHAMBRA
1998
FEE
18.4
195,455
100.0
COSTCO
2027
2057
COSTCO
2027
2057
JO-ANN FABRICS
2009
2019
ANAHEIM
1995
FEE
1.0
15,396
100.0
NORTHGATE GONZALEZ MARKETS
2022
2032
ANAHEIM (6)
2006
FEE
36.1
347,350
92.5
MERVYN'S
2012
2022
GIGANTE
2023
2033
OFFICEMAX
2011
2026
ANAHEIM (6)
2006
FEE
19.1
184,613
93.9
RALPHS
2016
2046
RITE AID
2016
2025
DOLLAR STORE
2009
2014
ANAHEIM (6)
2006
FEE
8.5
105,085
97.2
STATER BROTHERS
2011
2026
CVS
2012
2022
ANGEL'S CAMP (6)
2006
FEE
5.1
77,967
96.1
SAVE MART
2022
2048
RITE AID
2011
2031
ANTELOPE (6)
2006
FEE
13.1
119,998
89.8
FOOD MAXX
2008
2022
GOODWILL INDUSTRIES
2014
2029
BAKERSFIELD (6)
2006
FEE
1.2
14,115
91.5
BELLFLOWER (6)
2006
GROUND LEASE (2032)
9.1
113,511
100.0
STATER BROTHERS
2012
2022
STAPLES
2012
CALSBAD (6)
2006
FEE
21.1
160,928
98.2
MARSHALLS
2013
2018
DOLLAR TREE
2013
2023
KIDS 'R' US
2018
2027
CARMICHAEL
1998
FEE
18.5
210,306
100.0
HOME DEPOT
2013
2022
SPORTS AUTHORITY
2009
2024
LONGS DRUGS
2013
2033
CHICO
2006
FEE
1.3
19,560
87.3
CHICO
2007
FEE
26.5
264,680
97.5
FOOD MAXX
2009
2024
ASHLEY FURNITURE HOMESTORE
2009
2019
BED, BATH & BEYOND
2014
2029
CHICO (8)
2007
JOINT VENTURE
7.3
69,812
100.0
RALEY'S
2024
2039
CHINO (6)
2006
FEE
33.0
341,577
93.3
LA CURACAO
2021
2041
ROSS DRESS FOR LESS
2013
2033
DD'S DISCOUNT
2016
2036
CHINO (6)
2006
FEE
13.1
168,264
100.0
DOLLAR TREE
2008
2023
PETSMART
2012
2027
RITE AID
2010
2020
CHINO HILLS
2005
FEE
7.3
73,352
91.3
STATER BROTHERS
2022
2052
CHINO HILLS (6)
2006
FEE
11.8
128,082
71.9
CHULA VISTA
1998
FEE
34.3
356,335
99.7
COSTCO
2029
2079
WAL-MART
2025
2086
NAVCARE
2009
COLMA (8)
2006
JOINT VENTURE
6.4
213,532
97.8
MARSHALLS
2012
NORDSTROM RACK
2017
BED BATH & BEYOND
2011
2026
CORONA
1998
FEE
47.6
487,048
96.6
COSTCO
2012
2042
HOME DEPOT
2010
2029
LEVITZ
2009
2029
CORONA
2007
FEE
12.3
148,815
97.0
VONS
2013
2038
PETSMART
2009
2034
ANNA'S LINENS
2012
2027
COVINA (7)
2000
GROUND LEASE (2054)/ JOINT VENTURE
26.0
269,433
90.8
HOME DEPOT
2009
2034
STAPLES
2011
PETSMART
2008
2028
CUPERTINO
2006
FEE
11.5
114,533
88.1
99 RANCH MARKET
2012
2027
DALY CITY (3)
2002
FEE
25.6
554,120
95.2
HOME DEPOT
2026
2056
BURLINGTON COAT FACTORY
2012
2022
SAFEWAY
2009
2024
DOWNEY (6)
2006
GROUND LEASE (2009)
9.8
114,722
100.0
A WORLD OF DECOR
2009
DUBLIN (6)
2006
FEE
12.4
154,728
100.0
ORCHARD SUPPLY HARDWARE
2011
MARSHALLS
2010
2025
ROSS DRESS FOR LESS
2013
2023
EL CAJON
2003
JOINT VENTURE
10.9
128,343
100.0
KOHL'S
2024
2053
MICHAELS
2015
2035
EL CAJON (9)
2004
FEE
10.4
98,474
98.3
RITE AID
2018
2043
ROSS DRESS FOR LESS
2014
2024
PETCO
2009
2014
ELK GROVE
2006
FEE
2.3
30,130
100.0
ELK GROVE
2006
FEE
0.8
7,880
100.0
ELK GROVE (6)
2006
FEE
8.1
120,970
100.0
BEL AIR MARKET
2025
2050
CARL'S JR.
2020
2034
ELK GROVE (6)
2006
FEE
5.0
34,015
90.2
ENCINITAS (6)
2006
FEE
9.1
119,738
84.7
ALBERTSONS
2011
2031
ESCONDIDO (6)
2006
FEE
23.1
231,157
98.3
LA FITNESS
2017
VONS
2009
2014
CVS
2009
2034
FAIR OAKS (6)
2006
FEE
9.6
98,625
92.3
RALEY'S
2011
2021
FOLSOM
2003
JOINT VENTURE
9.5
108,255
100.0
KOHL'S
2018
2048
FREMONT (6)
2007
JOINT VENTURE
51.7
504,666
96.0
SAFEWAY
2025
2050
BED BATH & BEYOND
2010
2025
MARSHALLS
2015
2030
FREMONT (6)
2006
FEE
11.9
131,239
99.1
ALBERTSONS
2013
2038
LONGS DRUGS
2011
2021
BALLY TOTAL FITNESS
2009
2029
FRESNO (6)
2006
FEE
9.9
102,581
91.4
SAVE MART
2014
2034
RITE AID
2014
2044
FRESNO (9)
2004
FEE
10.8
121,107
100.0
BED BATH & BEYOND
2010
2025
SPORTMART
2013
2023
ROSS DRESS FOR LESS
2011
2031
FULLERTON (6)
2006
GROUND LEASE (2042)
20.3
270,647
95.2
TOYS'R 'US/CHUCK E.CHEESE
2017
2042
AMC THEATRES
2012
2037
GARDENA (6)
2006
FEE
6.5
65,987
100.0
TAWA MARKET
2010
2020
RITE AID
2015
2035
GRANITE BAY (6)
2006
FEE
11.5
140,184
88.9
RALEY'S
2018
2033
GRASS VALLEY (6)
2006
FEE
30.0
217,519
95.0
RALEY'S
2018
JCPENNEY
2008
2033
COURTHOUSE ATHLETIC CLUB
2009
2014
HACIENDA HEIGHTS (6)
2006
FEE
12.1
135,012
90.3
ALBERTSONS
2016
2071
VIVO DANCE
2012
HAYWARD (6)
2006
FEE
8.1
80,911
100.0
99 CENTS ONLY STORES
2010
2025
BIG LOTS
2011
2021
HUNTINGTON BEACH (6)
2006
FEE
12.0
148,756
99.0
VONS
2016
2036
CVS
2015
2030
JACKSON
2007
FEE
9.2
67,665
100.0
RALEY'S
2024
2049
LA MIRADA
1998
FEE
31.2
261,782
100.0
TOYS "R" US
2012
2032
U.S. POSTAL SERVICE
2010
2020
MOVIES 7 DOLLAR THEATRE
2008
2018
LA VERNE (6)
2006
GROUND LEASE (2059)
20.1
227,575
98.8
TARGET
2009
2034
VONS
2010
2055
LAGUNA HILLS
2007
JOINT VENTURE
16.0
160,000
100.0
MACY'S
2014
2050
LINCOLN (8)
2007
JOINT VENTURE
13.1
119,559
98.8
SAFEWAY
2026
2066
LONGS DRUG STORES
2027
2057
LIVERMORE (6)
2006
FEE
8.1
104,363
96.2
ROSS DRESS FOR LESS
2009
2024
RICHARD CRAFTS
2008
2018
BIG 5 SPORTING GOODS
2012
2022
LOS ANGELES (6)
2006
GROUND LEASE (2070)
0.0
169,744
99.1
KMART
2012
2018
SUPERIOR MARKETS
2023
2038
CVS
2011
2016
LOS ANGELES (6)
2006
GROUND LEASE (2050)
14.6
165,195
95.3
RALPHS/FOOD 4 LESS
2011
2037
FACTORY 2-U
2011
2016
RITE AID
2010
2025
MANTECA
2006
FEE
1.1
19,455
94.4
MANTECA (6)
2006
FEE
7.2
96,393
96.6
PAK 'N' SAVE
2013
BIG 5 SPORTING GOODS
2018
MERCED
2006
FEE
1.6
27,350
81.4
MODESTO (6)
2006
FEE
17.9
214,772
96.7
GOTTSCHALKS
2013
2027
RALEY'S
2009
2024
GOTTSCHALKS
2012
2026
MONTEBELLO (7)
2000
JOINT VENTURE
25.4
251,489
99.4
SEARS
2012
2062
TOYS "R" US
2018
2043
AMC THEATRES
2012
2032
MORAGA (6)
2006
FEE
33.7
163,975
92.1
TJ MAXX
2011
2026
LONGS DRUGS
2010
2035
U.S. POSTAL SERVICE
2011
2031
MORGAN HILL
2003
JOINT VENTURE
8.1
103,362
100.0
HOME DEPOT
2024
2054
NAPA
2006
GROUND LEASE (2070)/ JOINT VENTURE
34.5
349,530
100.0
TARGET
2020
2040
HOME DEPOT
2018
2040
RALEY'S
2020
2045
NORTHRIDGE
2005
FEE
9.3
158,812
100.0
DSW SHOE WAREHOUSE
2016
2028
LINENS N THINGS
2013
2028
GELSON'S MARKET
2017
2027
NOVATO (6)
2003
FEE
11.3
133,862
97.8
SAFEWAY
2025
2060
RITE AID
2008
2023
BIG LOTS
2010
2020
OCEANSIDE (6)
2006
FEE
42.7
366,775
97.6
STEIN MART
2009
2024
ROSS DRESS FOR LESS
2009
2014
BARNES & NOBLE
2013
2028
OCEANSIDE (6)
2006
GROUND LEASE (2048)
9.5
92,378
87.1
TRADER JOE'S
2016
2026
LAMPS PLUS
2011
OCEANSIDE (6)
2006
FEE
10.2
88,363
92.2
VONS
2008
LONGS DRUGS
2013
2033
ORANGEVALE (6)
2006
FEE
17.3
160,811
96.4
ALBERTSONS
2024
2064
LONGS DRUGS
2022
2052
U.S. POSTAL SERVICE
2012
OXNARD (7)
1998
JOINT VENTURE
14.4
171,580
100.0
TARGET
2013
FOOD 4 LESS
2013
24 HOUR FITNESS
2010
2020
PACIFICA (11)
2004
JOINT VENTURE
13.6
168,871
96.3
SAFEWAY
2018
2038
ROSS DRESS FOR LESS
2010
2020
RITE AID
2021
PACIFICA (6)
2006
FEE
7.5
104,281
96.1
ALBERTSONS
2008
2032
RITE AID
2012
2042
21
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
PLEASANTON
2007
JOINT VENTURE
17.5
175,000
100.0
MACY'S
2012
2040
PORTERVILLE (6)
2006
FEE
8.1
81,010
93.2
SAVE MART
2010
2030
COUNTY OF TULARE
2025
2045
POWAY
2005
FEE
8.3
121,977
93.5
STEIN MART
2013
2028
HOME GOODS
2014
2034
OFFICE DEPOT
2013
2028
RANCHO CUCAMONGA (6)
2006
GROUND LEASE (2042)
17.1
308,846
96.7
FOOD 4 LESS
2014
2034
SPORTS CHALET
2010
2020
AMIGO'S FLOORING MONSTER
2015
2040
RANCHO CUCAMONGA (6)
2006
FEE
5.2
56,019
100.0
CVS
2011
2026
RANCHO MIRAGE (6)
2006
FEE
16.9
165,156
89.7
VONS
2010
2039
LONGS DRUGS
2010
2029
RED BLUFF
2006
FEE
4.6
23,200
100.0
REDDING
2006
FEE
1.8
21,876
89.0
REDWOOD CITY (9)
2004
FEE
6.4
49,429
100.0
ORCHARD SUPPLY HARDWARE
2009
2029
RIVERSIDE
2007
FEE
5.0
86,108
100.0
BURLINGTON COAT FACTORY
2009
2028
ROSEVILLE (8)
2007
JOINT VENTURE
9.0
81,171
100.0
SAFEWAY
2030
2060
ROSEVILLE (9)
2004
FEE
20.3
188,493
99.3
SPORTS AUTHORITY
2016
2031
LINENS N THINGS
2012
2027
ROSS DRESS FOR LESS
2013
2028
SACRAMENTO (6)
2006
FEE
23.1
189,043
96.5
SD MART
2014
2024
SEAFOOD CITY
2018
2033
BIG 5 SPORTING GOODS
2012
2022
SACRAMENTO (6)
2006
FEE
13.2
120,893
91.5
UNITED ARTISTS THEATRE
2016
2028
24 HOUR FITNESS
2012
2027
SAN DIEGO
2007
JOINT VENTURE
22.6
225,919
100.0
NORDSTROM
2017
2037
SAN DIEGO
2007
FEE
13.4
49,080
100.0
SAN DIEGO (6)
2006
GROUND LEASE (2023)
16.4
210,621
100.0
CIRCUIT CITY
2010
2020
TJ MAXX
2010
2015
CVS
2013
2023
SAN DIEGO (7)
2000
JOINT VENTURE
11.2
117,410
100.0
ALBERTSONS
2012
SPORTMART
2013
SAN DIEGO (8)
2007
JOINT VENTURE
5.9
59,414
98.4
SAN DIEGO (8)
2007
JOINT VENTURE
12.8
57,406
100.0
SAN DIEGO (9)
2004
FEE
42.1
411,375
100.0
COSTCO
2014
2044
PRICE SELF STORAGE
2035
CHARLOTTE RUSSE
2009
2019
SAN DIEGO (9)
2004
FEE
5.9
35,000
100.0
CLAIM JUMPER
2013
2023
SAN DIMAS (6)
2006
FEE
13.4
154,020
98.7
OFFICEMAX
2011
2026
ROSS DRESS FOR LESS
2013
2023
PETCO
2012
2027
SAN JOSE (6)
2006
FEE
16.8
183,180
97.3
WAL-MART
2011
2041
WALGREENS
2030
SAN LEANDRO (6)
2006
FEE
6.2
95,255
100.0
ROSS DRESS FOR LESS
2018
MICHAELS
2008
2013
SAN LUIS OBISPO
2005
FEE
17.6
174,428
96.3
VON'S
2017
2042
MICHAELS
2008
2028
CVS
2017
2047
SAN RAMON (7)
1999
JOINT VENTURE
5.3
41,913
100.0
PETCO
2012
2022
SANTA ANA
1998
FEE
12.0
134,400
100.0
HOME DEPOT
2015
2035
SANTA CLARITA (6)
2006
FEE
14.1
96,662
84.2
ALBERTSONS
2012
2042
SANTA ROSA
2005
FEE
3.6
41,565
97.0
ACE HARDWARE
2009
2019
SANTEE
2003
JOINT VENTURE
44.5
311,439
99.2
24 HOUR FITNESS
2017
BED BATH & BEYOND
2012
2017
TJ MAXX
2012
2027
SIGNAL HILL (9)
2004
FEE
15.0
181,250
97.3
HOME DEPOT
2014
2034
PETSMART
2009
2024
STOCKTON
1999
FEE
14.6
152,919
87.2
SUPER UNITED FURNITURE
2009
2019
COSTCO
2013
2033
TEMECULA (6)
2006
FEE
17.9
139,130
98.6
ALBERTSONS
2015
2035
LONGS DRUGS
2016
2041
TEMECULA (7)
1999
JOINT VENTURE
40.0
342,336
97.4
KMART
2017
2032
FOOD 4 LESS
2010
2030
TRISTONE THEATRES
2013
2018
TEMECULA (9)
2004
FEE
47.4
345,113
99.4
WAL-MART
2028
2058
KOHL'S
2023
2043
ROSS DRESS FOR LESS
2014
2034
TORRANCE (6)
2007
JOINT VENTURE
6.8
67,504
89.2
ACE HARDWARE
2013
2023
COOKIN' STUFF
2012
TORRANCE (7)
2000
JOINT VENTURE
26.7
266,847
100.0
HL TORRANCE
2011
2021
LINENS N THINGS
2010
2020
MARSHALLS
2009
2019
TRUCKEE
2006
FEE
3.2
26,553
88.8
TRUCKEE (8)
2007
GROUND LEASE (2016)/ JOINT VENTURE
4.9
41,149
97.1
TULARE (6)
2006
FEE
6.9
119,412
87.7
SAVE MART
2011
2031
RITE AID
2011
2041
DOLLAR TREE
2013
TURLOCK (6)
2006
FEE
10.1
111,612
100.0
RALEY'S
2018
2033
OUCHINA BUFFET
2014
2024
TUSTIN
2007
JOINT VENTURE
68.6
685,983
98.8
AMC THEATERS
2039
WHOLE FOODS MARKET
2027
TJ MAXX
2017
TUSTIN
2003
JOINT VENTURE
9.1
108,413
100.0
KMART
2018
2048
TUSTIN (6)
2006
FEE
15.7
209,996
98.0
VONS
2021
2041
RITE AID
2009
2029
KRAGEN AUTO PARTS
2011
2016
TUSTIN (6)
2006
FEE
12.9
138,348
98.0
RALPHS
2013
2023
LONGS DRUGS
2022
2032
MICHAELS
2013
UKIAH (6)
2006
FEE
11.1
110,565
100.0
RALEY'S
2016
2031
UPLAND (6)
2006
FEE
22.5
271,867
97.2
HOME DEPOT
2009
2029
PAVILIONS
2008
2043
STAPLES
2008
2028
VALENCIA (6)
2006
FEE
13.6
143,333
98.2
RALPHS
2023
2053
LONGS DRUGS
2008
2023
VALLEJO (6)
2006
FEE
14.2
150,766
97.1
RALEY'S
2017
2032
24 HOUR FITNESS
2008
2013
AARON RENTS
2013
2023
VALLEJO (6)
2006
FEE
6.8
66,000
100.0
SAFEWAY
2015
2045
VISALIA
2007
JOINT VENTURE
13.7
137,426
100.0
REGAL SEQUOIA MALL 12
2016
MARSHALLS
2010
BED BATH & BEYOND
2011
VISALIA (6)
2006
FEE
4.2
46,460
96.2
CHUCK E CHEESE
2008
2013
VISTA (6)
2006
FEE
12.0
136,672
90.4
ALBERTSONS
2011
2016
CVS
2010
2025
WALNUT CREEK (6)
2006
FEE
3.2
114,733
100.0
CENTURY THEATRES
2023
2053
COST PLUS
2014
2024
WESTMINSTER (6)
2006
FEE
16.4
208,660
97.6
PAVILIONS
2017
2047
NEW WORLD AUDIO/VIDEO
2013
WINDSOR (6)
2006
GROUND LEASE (2054)
13.1
127,047
97.1
SAFEWAY
2014
2054
LONGS DRUGS
2018
2048
WINDSOR (6)
2006
FEE
9.8
107,769
98.7
RALEY'S
2012
2027
21ST CENTURY HEALTH CLUB
2008
2017
YREKA (6)
2006
FEE
14.0
127,148
98.9
RALEY'S
2014
2029
JCPENNEY
2011
DOLLAR TREE
2013
COLORADO
AURORA
1998
FEE
13.8
154,536
80.8
ROSS DRESS FOR LESS
2017
2037
TJ MAXX
2012
SPACE AGE FEDERAL
2016
2026
AURORA
1998
FEE
9.9
44,174
89.2
AURORA
1998
FEE
13.9
152,282
85.7
ALBERTSONS
2011
2051
DOLLAR TREE
2012
2027
CROWN LIQUORS
2015
COLORADO SPRINGS
1998
FEE
10.7
107,310
76.0
RANCHO LIBORIO
2017
2042
DENVER
1998
FEE
1.5
18,405
100.0
SAVE-A-LOT
2012
2027
ENGLEWOOD
1998
FEE
6.5
80,330
93.5
HOBBY LOBBY
2013
2023
OLD COUNTRY BUFFET
2009
2019
FORT COLLINS
2000
FEE
11.6
115,862
100.0
KOHL'S
2020
2070
GUITAR CENTER
2017
2027
GREELEY (13)
2005
JOINT VENTURE
14.4
138,818
100.0
BED BATH & BEYOND
2016
2036
MICHAELS
2015
2035
CIRCUIT CITY
2016
2031
GREENWOOD VILLAGE
2003
JOINT VENTURE
21.0
196,726
100.0
HOME DEPOT
2019
2069
LAKEWOOD
1998
FEE
7.6
82,581
88.7
SAFEWAY
2012
2032
PUEBLO
2006
JOINT VENTURE
3.3
-
-
CONNECTICUT
BRANFORD (7)
2000
JOINT VENTURE
19.1
190,738
98.6
KOHL'S
2012
2022
SUPER FOODMART
2016
2038
DERBY (3)
2005
JOINT VENTURE
20.7
144,532
100.0
ENFIELD (7)
2000
JOINT VENTURE
14.9
148,517
100.0
KOHL'S
2021
2041
BEST BUY
2016
2031
FARMINGTON
1998
FEE
16.9
184,572
100.0
SPORTS AUTHORITY
2018
2063
LINENS N THINGS
2016
2036
BORDERS BOOKS
2018
2063
HAMDEN
1967
JOINT VENTURE
31.7
376,616
100.0
WAL-MART
2019
2039
BON-TON
2012
BOB'S STORES
2016
2036
NORTH HAVEN
1998
FEE
31.7
331,919
100.0
HOME DEPOT
2009
2029
BJ'S
2011
2041
XPECT DISCOUNT
2008
2013
WATERBURY
1993
FEE
13.1
137,943
100.0
RAYMOUR & FLANIGAN FURNITURE
2017
2037
STOP & SHOP
2013
2043
DELAWARE
ELSMERE
1979
GROUND LEASE (2076)
17.1
112,610
100.0
VALUE CITY
2008
2038
WILMINGTON (11)
2004
GROUND LEASE (2052)/ JOINT VENTURE
25.9
165,805
100.0
SHOPRITE
2014
2044
SPORTS AUTHORITY
2008
2023
RAYMOUR & FLANIGAN
2019
2044
FLORIDA
ALTAMONTE SPRINGS
1995
FEE
5.6
94,193
100.0
ORIENTAL MARKET
2012
2022
THOMASVILLE HOME
2011
2021
PEARL ARTS N CRAFTS
2008
2018
ALTAMONTE SPRINGS
1998
FEE
19.4
233,817
100.0
BAER'S FURNITURE
2024
2034
LEATHER GALLERIES
2009
2014
DSW SHOE WAREHOUSE
2012
2032
BOCA RATON
1967
FEE
9.9
73,549
97.5
WINN DIXIE
2008
2033
BONITA SPRINGS (8)
2006
JOINT VENTURE
7.9
79,676
94.3
PUBLIX
2022
2052
BOYNTON BEACH (7)
1999
JOINT VENTURE
18.0
194,028
100.0
BEALLS
2011
2056
ALBERTSONS
2015
2040
BRADENTON
1968
JOINT VENTURE
6.2
30,938
86.1
GRAND CHINA BUFFET
2009
2014
BRADENTON
1998
FEE
19.6
162,997
96.5
PUBLIX
2012
2032
TJ MAXX
2009
2019
JO-ANN FABRICS
2009
2024
BRANDON (7)
2001
JOINT VENTURE
29.7
143,785
100.0
BED BATH & BEYOND
2010
2020
ROSS DRESS FOR LESS
2010
2025
THOMASVILLE HOME
2010
2020
CAPE CORAL (8)
2006
JOINT VENTURE
12.5
125,110
98.5
PUBLIX
2022
2052
ROSS DRESS FOR LESS
2013
2033
STAPLES
2008
2033
CAPE CORAL (8)
2006
JOINT VENTURE
4.2
42,030
96.8
CLEARWATER
2005
FEE
20.7
207,071
95.2
HOME DEPOT
2023
2068
JO-ANN FABRICS
2014
2034
STAPLES
2014
2034
CORAL SPRINGS
1994
FEE
5.9
55,597
100.0
LINENS N THINGS
2012
2027
CORAL SPRINGS
1997
FEE
9.8
86,342
100.0
TJ MAXX
2012
2017
PARTY SUPERMARKET
2011
2016
CORAL WAY
1992
JOINT VENTURE
8.7
87,305
100.0
WINN DIXIE
2011
2036
STAPLES
2016
2031
CUTLER RIDGE
1998
JOINT VENTURE
3.8
37,640
100.0
POTAMKIN CHEVROLET
2015
2050
22
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
DELRAY BEACH (8)
2006
JOINT VENTURE
5.1
50,906
97.6
PUBLIX
2025
2055
EAST ORLANDO
1971
GROUND LEASE (2068)
11.6
131,981
98.1
SPORTS AUTHORITY
2010
2020
OFFICE DEPOT
2010
2025
C-TOWN
2013
2028
FERN PARK
1968
FEE
12.0
83,382
86.2
BOOKS-A-MILLION
2008
2016
OFFICEMAX
2008
2023
FORT LAUDERDALE (9)
2004
FEE
22.9
229,034
100.0
REGAL CINEMAS
2017
2057
OFFICE DEPOT
2011
2026
JUST FOR SPORTS
2017
2023
FORT MEYERS (8)
2006
JOINT VENTURE
7.4
74,286
90.7
PUBLIX
2023
2053
HIALEAH
1998
JOINT VENTURE
2.4
23,625
100.0
POTAMKIN CHEVROLET
2015
2050
HOLLYWOOD
2002
JOINT VENTURE
5.0
50,000
100.0
HOME GOODS
2010
2025
MICHAELS
2010
2030
HOLLYWOOD (9)
2004
FEE
98.9
871,723
98.6
HOME DEPOT
2019
2069
KMART
2019
2069
BJ'S
2019
2069
HOLLYWOOD (9)
2004
FEE
10.5
141,097
90.0
AZOPHARMA CONTRACT SERVICES
2011
2017
TRADER PUBLISHING COMPANY
2008
MANTECH SYSTEMS INT'L
2008
2013
HOMESTEAD
1972
GROUND LEASE (2093)/ JOINT VENTURE
21.4
209,214
100.0
PUBLIX
2014
2034
MARSHALLS
2011
2026
OFFICEMAX
2013
2028
JACKSONVILLE
2002
JOINT VENTURE
5.1
51,002
100.0
MICHAELS
2013
2033
HOME GOODS
2010
2020
JACKSONVILLE
1999
FEE
18.6
205,696
100.0
BURLINGTON COAT FACTORY
2013
2018
OFFICEMAX
2012
2032
TJ MAXX
2012
2017
JACKSONVILLE (4)
2005
JOINT VENTURE
149.2
111,000
100.0
JACKSONVILLE (8)
2006
JOINT VENTURE
7.3
72,840
88.5
PUBLIX
2053
JENSEN BEACH
1994
FEE
20.7
173,491
94.4
SERVICE MERCHANDISE
2010
2070
MARSHALLS
2010
2020
BEALLS
2008
2013
JENSEN BEACH (12)
2006
JOINT VENTURE
19.8
197,731
76.1
HOME DEPOT
2025
2030
HALLOWEEN EXPRESS
2008
KEY LARGO (7)
2000
JOINT VENTURE
21.5
207,332
96.9
KMART
2014
2064
PUBLIX
2009
2029
BEALLS OUTLET
2008
2011
KISSIMMEE
1996
FEE
18.4
90,840
81.2
OFFICEMAX
2012
2027
DOCKSIDE IMPORT
2008
LAKELAND
2001
FEE
22.9
196,635
97.2
STEIN MART
2011
2026
ROSS DRESS FOR LESS
2012
MARSHALLS
2011
LAKELAND
2006
FEE
9.0
86,022
100.0
SPORTS AUTHORITY
2011
2026
LAKELAND SQUARE 10 THEATRE
2010
2020
CHUCK E CHEESE
2016
2026
LARGO
1968
FEE
12.0
149,472
100.0
WAL-MART
2012
2027
ALDI
2018
2038
LARGO
1992
FEE
29.4
215,916
96.7
PUBLIX
2009
2029
AMC THEATRES
2011
2036
OFFICE DEPOT
2009
2019
LARGO
1993
FEE
6.6
56,668
41.0
LAUDERDALE LAKES
1968
JOINT VENTURE
10.0
115,341
98.2
SAVE-A-LOT
2012
2017
THINK THRIFT
2012
2017
LAUDERHILL
1978
FEE
18.1
181,416
90.5
STAPLES
2017
2037
BABIES R US
2009
2014
99CENT STUFF
2008
2018
LEESBURG
1969
GROUND LEASE (2017)
1.3
13,468
88.9
MARGATE
1993
FEE
34.1
233,193
100.0
PUBLIX
2008
2028
SAM ASH MUSIC
2011
OFFICE DEPOT
2010
2025
MELBOURNE
1968
GROUND LEASE (2071)
11.5
168,737
99.3
SUBMITTORDER CO
2010
2022
WALGREENS
2045
GOODWILL INDUSTRIES
2012
MELBOURNE
1998
FEE
13.2
144,439
95.9
JO-ANN FABRICS
2016
2031
BED BATH & BEYOND
2013
2028
MARSHALLS
2010
MERRITT ISLAND (8)
2006
JOINT VENTURE
6.0
60,103
100.0
PUBLIX
2023
2053
MIAMI
1968
FEE
8.2
104,908
100.0
HOME DEPOT
2029
2059
MILAM'S MARKET
2008
WALGREENS
2009
MIAMI
1962
JOINT VENTURE
14.0
79,273
89.9
BABIES R US
2011
2021
FIRESTONE TIRE
2008
MIAMI
1986
FEE
7.8
83,380
98.7
PUBLIX
2009
2029
WALGREENS
2018
MIAMI
1998
JOINT VENTURE
2.9
29,166
100.0
LEHMAN TOYOTA
2015
2050
MIAMI
1998
JOINT VENTURE
1.7
17,117
100.0
LEHMAN TOYOTA
2015
2050
MIAMI
1998
JOINT VENTURE
8.7
86,900
100.0
POTAMKIN CHEVROLET
2015
2050
MIAMI
2007
FEE
33.4
349,926
100.0
PUBLIX
2011
2031
LINENS 'N THINGS
2015
2030
OFFICE DEPOT
2010
2015
MIAMI
1995
FEE
5.4
63,604
100.0
PETCO
2016
2021
PARTY CITY
2012
2017
MIAMI (8)
2007
JOINT VENTURE
7.5
59,880
95.8
PUBLIX
2027
2062
MIAMI (8)
2006
JOINT VENTURE
6.4
63,595
100.0
PUBLIX
2023
2053
MIAMI (9)
2004
FEE
31.2
402,801
96.9
KMART
2012
2042
EL DORADO FURNITURE
2017
2032
SYMS
2011
2041
MIDDLEBURG (4)
2005
JOINT VENTURE
37.1
24,000
100.0
MILTON (4)
2007
JOINT VENTURE
2.3
-
-
MIRAMAR (4)
2005
JOINT VENTURE
36.7
44,000
100.0
MOUNT DORA
1997
FEE
12.4
120,430
100.0
KMART
2013
2063
NORTH LAUDERDALE (6)
2007
JOINT VENTURE
28.9
250,209
98.2
HOME DEPOT
2019
2049
CHANCELLOR ACADEMY
2011
2016
PUBLIX
2011
2031
NORTH MIAMI BEACH
1985
FEE
15.9
108,795
100.0
PUBLIX
2019
2039
WALGREENS
2058
OCALA (3)
1997
FEE
27.2
260,435
92.9
KMART
2011
2021
BEST BUY
2019
2034
SERVICE MERCHANDISE
2012
2032
ORANGE PARK
2003
JOINT VENTURE
5.0
50,299
100.0
BED BATH & BEYOND
2015
2025
MICHAELS
2010
2030
ORLANDO
1968
JOINT VENTURE
10.0
114,434
86.9
BALLY TOTAL FITNESS
2008
2018
HSN
2009
JO-ANN FABRICS
2008
2011
ORLANDO (3)
1968
GROUND LEASE (2047)/JOINT VENTURE
7.8
45,360
100.0
TACO BELL
2027
2047
ORLANDO
1994
FEE
28.0
204,930
100.0
OLD TIME POTTERY
2010
2020
SPORTS AUTHORITY
2011
2031
USA BABY
2013
2018
ORLANDO
1996
FEE
11.7
132,856
100.0
ROSS DRESS FOR LESS
2008
2028
BIG LOTS
2009
2014
OFFICEMAX
2014
2034
ORLANDO (7)
2000
JOINT VENTURE
18.0
179,065
100.0
KMART
2014
2064
PUBLIX
2012
2037
ORLANDO (9)
2004
FEE
14.0
154,356
93.9
MARSHALLS
2013
2028
OFF BROADWAY SHOES
2013
2023
GOLFSMITH GOLF CENTER
2014
2024
OVIEDO (8)
2006
JOINT VENTURE
7.8
78,179
94.3
PUBLIX
2020
2050
PENSACOLA (4)
2007
JOINT VENTURE
3.4
-
-
PLANTATION
1974
JOINT VENTURE
4.6
60,414
95.6
BREAD OF LIFE
2009
2019
WHOLE FOODS MARKET
2009
2019
POMPANO BEACH
1968
JOINT VENTURE
6.6
66,613
96.4
SAVE-A-LOT
2015
2030
POMPANO BEACH
2007
JOINT VENTURE
10.3
103,173
100.0
KMART
2012
2017
POMPANO BEACH (13)
2004
JOINT VENTURE
18.6
140,312
90.8
WINN DIXIE
2018
2043
CVS
2020
2040
PORT RICHEY (7)
1998
JOINT VENTURE
14.3
91,235
70.2
CIRCUIT CITY
2011
2031
STAPLES
2011
2026
RIVIERA BEACH
1968
JOINT VENTURE
5.1
46,390
92.2
FURNITURE KINGDOM
2009
2014
GOODWILL INDUSTRIES
2008
SANFORD
1989
FEE
40.9
195,688
96.6
ARBY'S
2027
2047
ROSS DRESS FOR LESS
2012
2032
OFFICE DEPOT
2009
2019
SARASOTA
1970
FEE
10.0
102,455
100.0
TJ MAXX
2012
2017
OFFICEMAX
2009
2024
DOLLAR TREE
2012
2032
SARASOTA
1989
FEE
12.0
129,700
96.6
SWEETBAY
2020
2040
ACE HARDWARE
2013
2023
ANTHONY'S LADIES WEAR
2012
2017
SARASOTA (8)
2006
JOINT VENTURE
6.5
65,320
91.7
PUBLIX
2063
ST. AUGUSTINE
2005
JOINT VENTURE
1.5
62,000
91.9
HOBBY LOBBY
2019
2032
ST. PETERSBURG
1968
GROUND LEASE (2084)/ JOINT VENTURE
9.0
118,574
100.0
KASH N' KARRY
2017
2037
TJ MAXX
2012
2014
DOLLAR TREE
2012
2022
TALLAHASSEE
1998
FEE
12.8
105,655
75.9
STEIN MART
2018
2033
SHOE STATION
2008
2012
TAMPA
1997/ 2004
FEE
23.9
205,634
100.0
AMERICAN SIGNATURE HOME
2019
2044
DSW SHOE WAREHOUSE
2018
2033
STAPLES
2013
2018
TAMPA
2004
FEE
22.4
186,676
100.0
LOWE'S HOME CENTER
2026
2066
TAMPA (13)
2007
JOINT VENTURE
10.0
100,200
94.9
PUBLIX
2011
2026
TAMPA (7)
2001
JOINT VENTURE
73.0
340,460
94.3
BEST BUY
2016
2031
JO-ANN FABRICS
2016
2031
BED BATH & BEYOND
2015
2030
WEST PALM BEACH
1967/ 1984
JOINT VENTURE
8.0
81,073
100.0
WINN DIXIE
2010
2030
WEST PALM BEACH
1995
FEE
7.9
79,904
93.4
BABIES R US
2011
2021
WEST PALM BEACH (9)
2004
FEE
33.0
357,537
93.5
KMART
2018
2068
WINN DIXIE
2019
2049
LINENS N THINGS
2010
2025
WINTER HAVEN
1973
JOINT VENTURE
13.9
95,188
98.7
BIG LOTS
2010
2020
JO-ANN FABRICS
2011
2016
BUDDY'S HOME FURNISHINGS
2015
2025
YULEE (4)
2003
JOINT VENTURE
82.1
46,000
100.0
GEORGIA
ALPHARETTA
2007
FEE
13.1
130,515
96.6
KROGER
2020
2050
ATLANTA
2007
FEE
31.0
354,214
90.4
DAYS INN
2014
2034
KROGER
2021
2056
GOODYEAR TIRE
2010
2030
ATLANTA (13)
2007
JOINT VENTURE
10.1
175,835
100.0
MARSHALLS
2014
2034
BEST BUY
2014
2029
LINENS' N THINGS
2014
2024
AUGUSTA
1995
FEE
11.3
112,537
89.3
TJ MAXX
2010
2015
ROSS DRESS FOR LESS
2013
2033
RUGGED WEARHOUSE
2008
2018
AUGUSTA (7)
2001
JOINT VENTURE
52.6
531,815
99.4
ASHLEY FURNTIURE HOMESTORE
2009
2019
GOODY'S FAMILY CLOTHING
2014
2029
COMPUSA
2013
2028
DULUTH (8)
2006
JOINT VENTURE
7.8
78,025
100.0
WHOLE FOODS MARKET
2027
2057
SAVANNAH
1993
FEE
22.2
187,076
97.2
BED BATH & BEYOND
2013
2028
TJ MAXX
2010
2015
MARSHALLS
2013
2022
SAVANNAH (3)
1995
GROUND LEASE (2045)
8.5
80,378
87.4
STAPLES
2015
2030
SAVANNAH
2007
FEE
17.9
197,967
93.8
LINENS 'N THINGS
2016
2031
ROSS DRESS FOR LESS
2016
2036
COST PLUS
2016
2031
SNELLVILLE (7)
2001
JOINT VENTURE
35.6
311,033
93.9
KOHL'S
2022
2062
BELK
2015
2035
LINENS N THINGS
2015
2030
VALDOSTA
2004
JOINT VENTURE
17.5
175,396
100.0
LOWE'S HOME CENTER
2019
2069
HAWAII
KIHEI
2006
FEE
4.6
17,897
94.7
IDAHO
NAMPA (4)
2005
JOINT VENTURE
70.9
-
-
ILLINOIS
ALTON
1986
FEE
21.2
131,188
100.0
VALUE CITY
2008
2023
AURORA
1998
FEE
17.9
91,182
100.0
CERMAK PRODUCE AURORA
2022
2042
23
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
AURORA (8)
2005
JOINT VENTURE
34.7
361,984
72.5
BEST BUY
2011
2026
VALUE CITY FURNITURE
2009
2019
GOLFSMITH
2016
2031
BATAVIA (7)
2002
JOINT VENTURE
31.7
272,410
100.0
KOHL'S
2019
2049
HOBBY LOBBY
2009
2019
LINENS N THINGS
2014
2029
BELLEVILLE
1987
GROUND LEASE (2057)
20.3
100,160
100.0
KMART
2024
2054
WESTFIELD PLAZA ASSOCIATES
2008
2052
BLOOMINGTON
1972
FEE
16.1
188,250
100.0
SCHNUCK MARKETS
2014
2029
TOYS "R" US
2015
2045
BARNES & NOBLE
2010
2015
BLOOMINGTON
2003
JOINT VENTURE
11.0
73,951
100.0
JEWEL-OSCO
2014
2039
BRADLEY
1996
FEE
5.4
80,535
100.0
CARSON PIRIE SCOTT
2014
2034
CALUMET CITY
1997
FEE
17.0
159,647
98.1
MARSHALLS
2014
2029
BEST BUY
2012
2032
BED BATH & BEYOND
2014
2024
CHAMPAIGN
1999
FEE
9.0
112,000
63.1
HOBBY LOBBY
2017
2027
CHAMPAIGN (7)
2001
JOINT VENTURE
9.3
111,720
100.0
BEST BUY
2016
2031
DICK'S SPORTING GOODS
2016
2031
MICHAELS
2010
2025
CHICAGO
1997
GROUND LEASE (2040)
17.5
102,011
100.0
BURLINGTON COAT FACTORY
2020
2035
RAINBOW SHOPS
2011
2021
BEAUTY ONE
2010
2015
CHICAGO
1997
FEE
6.0
86,894
100.0
KMART
2024
2054
COUNTRYSIDE
1997
FEE
27.7
117,005
100.0
HOME DEPOT
2023
2053
CRESTWOOD
1997
GROUND LEASE (2051)
36.8
79,903
100.0
SEARS
2024
2051
CRYSTAL LAKE
1998
FEE
6.1
80,390
72.5
HOBBY LOBBY
2009
2019
DINOREX
2012
2022
DOWNERS GROVE
1998
GROUND LEASE (2062)
5.0
100,000
100.0
HOME DEPOT EXPO
2022
2062
DOWNERS GROVE
1999
FEE
24.8
144,770
98.2
DOMINICK'S
2009
2019
DOLLAR TREE
2013
2023
WALGREENS
2022
DOWNERS GROVE
1997
FEE
12.0
141,906
100.0
TJ MAXX
2009
2024
BEST BUY
2015
2030
BEST BUY
2012
2032
ELGIN
1972
FEE
18.7
186,432
100.0
ELGIN MALL
2013
2023
ELGIN FARMERS PRODUCTS
2010
2030
AARON SALES
2012
2022
FAIRVIEW HEIGHTS
1986
GROUND LEASE (2054)
19.1
192,073
100.0
KMART
2024
2054
OFFICEMAX
2015
2025
WALGREENS
2010
2029
FOREST PARK
1997
GROUND LEASE (2021)
9.3
98,371
100.0
KMART
2021
GENEVA
1996
FEE
8.2
110,188
100.0
GANDER MOUNTAIN
2013
2028
KILDEER (8)
2006
JOINT VENTURE
23.3
167,477
98.6
BED BATH & BEYOND
2012
2032
CIRCUIT CITY
2017
2042
OLD NAVY
2011
2016
MATTESON
1997
FEE
17.0
157,885
100.0
SPORTMART
2014
2029
MARSHALLS
2010
2025
LINENS N THINGS
2014
2029
MOUNT PROSPECT
1997
FEE
16.8
192,547
100.0
KOHL'S
2024
2054
HOBBY LOBBY
2016
2026
POOL-A-RAMA
2011
2018
MUNDELIEN
1991
FEE
7.6
89,692
100.0
BURLINGTON COAT FACTORY
2018
2033
NAPERVILLE
1997
FEE
9.0
102,327
100.0
BURLINGTON COAT FACTORY
2013
2033
NORRIDGE
1997
GROUND LEASE (2047)
11.7
116,914
100.0
KMART
2012
2047
OAK LAWN
1997
FEE
15.4
176,037
100.0
KMART
2024
2054
CHUCK E CHEESE
2016
2026
OAKBROOK TERRACE
1983/ 1997
GROUND LEASE (2049)
16.7
176,263
100.0
HOME DEPOT
2024
2044
LINENS N THINGS
2017
2032
LOYOLA MEDICAL CENTER
2011
2016
ORLAND PARK
1997
FEE
18.8
131,546
100.0
VALUE CITY
2015
2030
OTTAWA
1970
FEE
9.0
60,000
100.0
VALUE CITY
2012
2022
PEORIA
1997
GROUND LEASE (2031)
20.5
156,067
100.0
KMART
2009
MARSHALLS
2009
2024
ROCKFORD
2007
FEE
8.9
89,047
100.0
BEST BUY
2016
2031
LINENS N THINGS
2016
2031
ROLLING MEADOWS
2003
FEE
3.7
37,225
100.0
FAIR LANES ROLLING MEADOWS
2013
SCHAUMBURG
2003
JOINT VENTURE
63.0
628,294
98.8
GALYAN'S TRADING COMPANY
2013
2038
CARSON PIRIE SCOTT
2021
2071
LOEWS THEATRES
2019
2039
SCHAUMBURG
1998
JOINT VENTURE
7.3
-
-
SKOKIE
1997
FEE
5.8
58,455
100.0
MARSHALLS
2010
2025
OLD NAVY
2010
2015
STREAMWOOD
1999
FEE
5.6
81,000
100.0
VALUE CITY
2015
2030
WAUKEGAN
1998
FEE
6.8
90,555
100.0
PICK N SAVE
2009
2029
WOODRIDGE
1998
FEE
13.1
161,272
94.1
WOODGROVE THEATERS, INC
2012
2022
KOHL'S
2010
2030
MCSPORTS
2008
INDIANA
EVANSVILLE
1986
FEE
14.2
192,933
82.8
BURLINGTON COAT FACTORY
2012
2027
OFFICEMAX
2012
2027
FAMOUS FOOTWEAR
2010
2025
GREENWOOD
1970
FEE
25.7
168,577
96.8
BABY SUPERSTORE
2011
2021
TOYS "R" US
2011
2056
TJ MAXX
2010
2015
GRIFFITH
1997
FEE
10.6
114,684
100.0
KMART
2024
2054
INDIANAPOLIS
1963
JOINT VENTURE
17.4
165,255
100.0
KROGER
2026
2066
AJ WRIGHT
2012
2027
CVS
2021
2031
LAFAYETTE
1971
FEE
12.4
90,500
100.0
KROGER
2026
2056
LAFAYETTE
1997
FEE
24.3
238,288
84.0
HOME DEPOT
2026
2056
JO-ANN FABRICS
2010
2020
SMITH OFFICE EQUIPMENT
2008
LAFAYETTE
1998
FEE
43.2
214,876
85.2
SPECIALTY RETAIL CONCEPTS, LLC
2008
PETSMART
2012
2032
STAPLES
2011
2026
MISHAWAKA
1998
FEE
7.5
82,100
-
SOUTH BEND (3)
1997
JOINT VENTURE
14.6
145,992
97.1
BED BATH & BEYOND
2015
2040
DSW SHOE WAREHOUSE
2020
2035
PETSMART
2015
2030
SOUTH BEND
1999
FEE
1.8
81,668
100.0
MENARD
2010
2030
IOWA
CLIVE
1996
FEE
8.8
90,000
100.0
KMART
2021
2051
COUNCIL BLUFFS (4)
2006
JOINT VENTURE
56.2
112,000
100.0
DAVENPORT
1997
GROUND LEASE (2028)
9.1
91,035
100.0
KMART
2024
2028
DES MOINES
1999
FEE
23.0
149,059
80.1
BEST BUY
2008
2023
OFFICEMAX
2013
2018
PETSMART
2017
2042
DUBUQUE
1997
GROUND LEASE (2019)
6.5
82,979
100.0
SHOPKO
2018
2019
SOUTHEAST DES MOINES
1996
FEE
9.6
111,847
100.0
HOME DEPOT
2020
2065
WATERLOO
1996
FEE
9.0
104,074
100.0
HOBBY LOBBY
2014
2024
TJ MAXX
2014
2024
SHOE CARNIVAL
2015
2025
EAST WICHITA (7)
1996
JOINT VENTURE
6.5
96,011
100.0
DICK'S SPORTING GOODS
2018
2033
GORDMANS
2012
2032
OVERLAND PARK
2006
FEE
14.5
120,164
100.0
HOME DEPOT
2010
2050
WEST WICHITA (7)
1996
JOINT VENTURE
8.1
96,319
100.0
SHOPKO
2018
2038
WICHITA (7)
1998
JOINT VENTURE
13.5
133,771
100.0
BEST BUY
2010
2025
TJ MAXX
2010
2020
MICHAELS
2010
2025
KENTUCKY
BELLEVUE
1976
FEE
6.0
53,695
100.0
KROGER
2010
2035
FLORENCE (11)
2004
JOINT VENTURE
8.2
99,578
95.0
DICK'S SPORTING GOODS
2018
2033
LINENS N THINGS
2018
2033
MCSWAIN CARPETS
2012
2017
HINKLEVILLE
1998
GROUND LEASE (2039)
2.0
85,229
-
K'S MERCHANDISE
2014
2039
LEXINGTON
1993
FEE
35.8
235,143
90.6
BEST BUY
2009
2024
BED BATH & BEYOND
2013
2038
TOYS "R" US
2013
2038
LOUISIANA
BATON ROUGE
1997
FEE
18.6
349,907
96.7
BURLINGTON COAT FACTORY
2009
2024
STEIN MART
2011
2016
K&G MEN'S COMPANY
2017
2032
BATON ROUGE
2005
JOINT VENTURE
9.4
67,755
90.5
WAL-MART
2024
2034
HARVEY
2003
JOINT VENTURE
17.4
181,660
100.0
BEST BUY
2017
2032
LINENS N THINGS
2012
2032
BARNES & NOBLE
2012
2022
HOUMA
1999
FEE
10.1
98,586
100.0
OLD NAVY
2009
2014
OFFICEMAX
2013
2028
MICHAELS
2009
2019
LAFAYETTE
1997
FEE
21.9
244,733
98.9
STEIN MART
2010
2020
LINENS N THINGS
2009
2024
TJ MAXX
2009
2019
MAINE
BANGOR
2001
FEE
8.6
86,422
100.0
BURLINGTON COAT FACTORY
2012
2032
S. PORTLAND
2007
FEE
12.5
98,401
95.7
DSW SHOE WAREHOUSE
2012
2027
DOLLAR TREE
2015
2025
GUITAR CENTER
2016
2026
MARYLAND
BALTIMORE (10)
2007
JOINT VENTURE
18.4
152,834
100.0
KMART
2010
2055
SALVO AUTO PARTS
2009
2019
BALTIMORE (10)
2007
JOINT VENTURE
10.6
112,722
100.0
SAFEWAY
2016
2046
RITE AID
2011
2026
DOLLAR TREE
2013
2028
BALTIMORE (10)
2007
JOINT VENTURE
7.3
77,287
100.0
SUPER FRESH
2021
2061
BALTIMORE (11) (3)
2004
JOINT VENTURE
7.6
79,815
100.0
GIANT FOOD
2016
2031
BALTIMORE (12)
2005
JOINT VENTURE
10.7
90,830
98.2
GIANT FOOD
2011
2036
BALTIMORE (13)
2004
JOINT VENTURE
7.5
90,903
98.9
GIANT FOOD
2026
2051
BALTIMORE (8)
2005
JOINT VENTURE
5.8
49,629
96.8
CORT FURNITURE RENTAL
2012
2022
BEL AIR (13)
2004
FEE
19.7
115,927
100.0
SAFEWAY
2030
2060
CVS
2021
2041
CLARKSVILLE (10)
2007
JOINT VENTURE
15.2
105,907
100.0
GIANT FOOD
2017
2027
CLINTON
2003
GROUND LEASE (2024)
2.6
2,544
100.0
CLINTON
2003
GROUND LEASE (2069)
2.6
-
-
COLUMBIA
2002
JOINT VENTURE
5.0
50,000
100.0
MICHAELS
2013
2033
HOME GOODS
2011
2021
COLUMBIA
2002
FEE
7.3
32,075
100.0
COLUMBIA
2002
FEE
2.5
23,835
100.0
DAVID'S NATURAL MARKET
2014
2019
COLUMBIA (10)
2007
JOINT VENTURE
12.2
41,494
98.2
COLUMBIA (13)
2005
JOINT VENTURE
0.7
6,780
100.0
COLUMBIA (8)
2006
JOINT VENTURE
12.3
91,165
100.0
SAFEWAY
2018
2043
COLUMBIA (8)
2006
JOINT VENTURE
16.4
100,803
94.0
GIANT FOOD
2012
2022
COLUMBIA (8)
2006
JOINT VENTURE
7.3
73,299
100.0
OLD NAVY
2013
24
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
EASTON (11)
2004
JOINT VENTURE
11.1
113,330
100.0
GIANT FOOD
2024
2054
FASHION BUG
2012
ELLICOTT CITY (11)
2004
JOINT VENTURE
31.8
143,548
99.0
SAFEWAY
2012
2042
PETCO
2011
2021
ELLICOTT CITY (6)
2007
JOINT VENTURE
42.5
433,467
100.0
TARGET
2016
2046
KOHL'S
2018
2038
SAFEWAY
2016
2046
ELLICOTT CITY (8)
2006
JOINT VENTURE
15.5
86,456
99.1
GIANT FOOD
2009
2019
GAITHERSBURG
1989
FEE
8.7
88,277
100.0
GREAT BEGINNINGS FURNITURE
2011
2021
FURNITURE 4 LESS
2010
GAITHERSBURG (6)
2007
JOINT VENTURE
6.6
71,329
100.0
RUGGED WEARHOUSE
2013
2018
HANCOCK FABRICS
2011
2016
OLD COUNTRY BUFFET
2011
2021
GLEN BURNIE (13)
2004
JOINT VENTURE
21.9
249,746
100.0
LOWE'S HOME CENTER
2019
2059
GIANT FOOD
2015
2025
HAGERSTOWN
1973
FEE
10.5
116,985
100.0
ZEYNA FURNITURE
2018
2028
SUPER SHOE
2011
2016
ALDI
2016
2031
HUNT VALLEY
2003
FEE
9.1
94,653
98.7
GIANT FOOD
2013
2033
LAUREL
1964
FEE
8.1
75,924
100.0
VILLAGE THRIFT STORE
2010
DOLLAR TREE
2010
2015
OLD COUNTRY BUFFET
2009
2019
LAUREL
1972
FEE
10.0
81,550
100.0
ROOMSTORE
2009
2014
LINTHICUM
2003
FEE
0.6
1,926
100.0
LUTHERVILLE (12)
2004
JOINT VENTURE
1.7
-
-
NORTH EAST (10)
2007
JOINT VENTURE
17.5
80,190
100.0
FOOD LION
2018
2038
OWINGS MILLS (13)
2004
JOINT VENTURE
11.0
116,303
94.7
GIANT FOOD
2020
2045
MERRITT ATHLETIC CLUB
2010
2015
PASADENA
2003
GROUND LEASE (2030)
2.7
38,727
97.2
PERRY HALL
2003
FEE
15.7
173,975
87.5
BRUNSWICK (LEISERV)BOWLING
2010
RITE AID
2010
2035
ACE HARDWARE
2016
2031
PERRY HALL (11)
2004
JOINT VENTURE
8.2
65,059
100.0
SUPER FRESH
2022
2062
TIMONIUM (3)
2003
FEE
17.2
109,940
100.0
STAPLES
2020
2045
TIMONIUM (10)
2007
JOINT VENTURE
6.0
59,799
91.8
AMERICAN RADIOLOGY
2012
2027
TOWSON (11)
2004
JOINT VENTURE
8.7
84,280
100.0
LINENS N THINGS
2015
2025
COMPUSA
2014
2029
TWEETER ENTERTAINMENT
2014
2024
TOWSON (13) (3)
2004
JOINT VENTURE
43.1
672,526
100.0
WAL-MART
2020
2005
TARGET
2009
2049
SUPER FRESH
2019
2049
WALDORF
2003
FEE
2.6
26,128
100.0
FAIR LANES WALDORF
2012
2017
WALDORF
2003
FEE
0.0
4,500
100.0
MASSACHUSETTS
GREAT BARRINGTON
1994
FEE
14.1
131,235
100.0
KMART
2011
2016
PRICE CHOPPER
2016
2036
HYANNIS (11)
2004
JOINT VENTURE
22.6
225,634
95.5
SHAW'S SUPERMARKET
2018
2028
TOYS "R" US
2019
2029
HOME GOODS
2010
2020
MARLBOROUGH
2004
JOINT VENTURE
16.1
104,125
100.0
BEST BUY
2019
2034
DSW SHOE WAREHOUSE
2014
2034
BORDERS BOOKS
2019
2034
PITTSFIELD (11)
2004
JOINT VENTURE
13.0
72,014
100.0
STOP & SHOP
2014
2044
QUINCY (13)
2005
JOINT VENTURE
8.0
80,510
100.0
SHAW'S SUPERMK
2009
2034
BROOKS PHARMACY
2017
2047
SHREWSBURY
1955
FEE
12.2
108,418
100.0
BOB'S STORES
2018
2033
BED BATH & BEYOND
2012
2032
STAPLES
2011
2021
STURBRIDGE (8)
2006
JOINT VENTURE
23.1
231,197
100.0
STOP & SHOP
2019
2049
MARSHALLS
2011
2026
LINENS N THINGS
2017
2032
MICHIGAN
CLARKSTON
1996
FEE
20.0
148,973
90.8
FARMER JACK
2015
2045
OFFICE DEPOT
2016
2031
CVS
2010
2020
CLAWSON (3)
1993
FEE
13.5
130,424
83.3
STAPLES
2011
2026
RITE AID
2026
2046
FARMINGTON
1993
FEE
2.8
96,915
89.5
OFFICE DEPOT
2016
2031
ACE HARDWARE
2017
2027
FITNESS 19
2015
2025
KALAMAZOO
2002
JOINT VENTURE
60.0
261,334
100.0
HOBBY LOBBY
2013
2023
VALUE CITY FURNITURE
2020
2040
MARSHALLS
2010
2030
LIVONIA
1968
FEE
4.5
33,121
100.0
CVS
2033
2083
FITNESS 19
2017
2027
MUSKEGON
1985
FEE
12.2
79,215
100.0
PLUMB'S FOOD
2012
2022
NOVI
2003
JOINT VENTURE
6.0
60,000
100.0
MICHAELS
2016
2036
HOME GOODS
2011
2026
TAYLOR
1993
FEE
13.0
141,549
100.0
KOHL'S
2022
2042
BABIES R US
2017
2043
PARTY AMERICA
2009
TROY (13)
2005
JOINT VENTURE
24.0
223,041
95.8
WAL-MART
2021
2051
MARSHALLS
2012
2027
WALKER
1993
FEE
41.8
338,928
100.0
RUBLOFF DEVELOPMENT
2016
2051
KOHL'S
2017
2037
LOEKS THEATRES
2012
2042
MINNESOTA
ARBOR LAKES
2006
FEE
44.4
463,634
100.0
LOWE'S HOME CENTER
2025
2075
DICK'S SPORTING GOODS
2017
2037
CIRCUIT CITY
2017
2037
HASTINGS (6)
2007
JOINT VENTURE
10.2
97,535
98.5
CUB FOODS
2023
2053
MAPLE GROVE (7)
2001
JOINT VENTURE
63.0
466,325
99.4
BYERLY'S
2020
2035
BEST BUY
2015
2030
JO-ANN FABRICS
2010
2030
MINNETONKA (7)
1998
JOINT VENTURE
12.1
120,231
94.3
TOYS "R" US
2016
2031
GOLFSMITH GOLF CENTER
2013
2018
OFFICEMAX
2011
MISSISSIPPI
HATTIESBURG (4)
2004
JOINT VENTURE
50.3
266,000
100.0
ASHLEY FURNITURE HOMESTORE
2016
2026
ROSS DRESS FOR LESS
2016
2041
BED BATH & BEYOND
2016
2041
HATTIESBURG (4)
2007
JOINT VENTURE
3.5
11,000
100.0
JACKSON
2002
JOINT VENTURE
5.0
50,000
100.0
MICHAELS
2014
2034
HOME GOODS
2014
2024
MISSOURI
BRIDGETON
1997
GROUND LEASE (2040)
27.3
101,592
100.0
KOHL'S
2010
2020
CRYSTAL CITY
1997
GROUND LEASE (2032)
10.1
100,724
100.0
KMART
2024
2032
ELLISVILLE
1970
FEE
18.4
118,080
100.0
SHOP N SAVE
2017
2032
2ND WIND EXERCISE EQUIPMENT
2011
2016
INDEPENDENCE
1985
FEE
21.0
184,870
100.0
KMART
2024
2054
THE TILE SHOP
2014
2024
OFFICE DEPOT
2012
2032
JOPLIN
1998
FEE
12.6
155,416
100.0
GOODY'S FAMILY CLOTHING
2010
2015
HASTINGS BOOKS
2009
2014
OFFICEMAX
2010
2025
JOPLIN (7)
1998
JOINT VENTURE
9.5
80,524
100.0
SHOPKO
2018
2038
KANSAS CITY
1997
FEE
17.8
150,381
100.0
HOME DEPOT
2010
2050
THE LEATHER COLLECTION
2013
2019
KIRKWOOD
1990
GROUND LEASE (2069)
19.8
249,104
100.0
HOBBY LOBBY
2014
2024
HEMISPHERES
2014
2024
GART SPORTS
2014
2029
LEMAY
1974
FEE
9.8
77,527
98.5
SHOP N SAVE
2020
2065
DOLLAR GENERAL
2008
MANCHESTER (7)
1998
JOINT VENTURE
9.6
89,305
100.0
KOHL'S
2018
2038
SPRINGFIELD
1994
FEE
41.5
277,590
92.6
BEST BUY
2011
2026
JCPENNEY
2010
2015
TJ MAXX
2011
2021
SPRINGFIELD
2002
FEE
8.5
84,916
100.0
BED BATH & BEYOND
2013
2028
MARSHALLS
2012
2027
BORDERS BOOKS
2023
2038
SPRINGFIELD
1986
GROUND LEASE (2087)
18.5
203,384
100.0
KMART
2024
2054
OFFICE DEPOT
2010
PACE-BATTLEFIELD, LLC
2017
2047
ST. CHARLES
1998
FEE
36.9
8,000
100.0
ST. CHARLES
1999
GROUND LEASE (2039)
8.4
84,460
100.0
KOHL'S
2019
2039
ST. LOUIS
1998
FEE
11.4
113,781
100.0
KOHL'S
2018
2038
CLUB FITNESS
2014
2024
ST. LOUIS
1972
FEE
13.1
129,093
96.3
SHOP N SAVE
2017
2082
ST. LOUIS
1986
FEE
17.5
176,273
100.0
BURLINGTON COAT FACTORY
2009
2024
BIG LOTS
2015
2030
OFFICE DEPOT
2009
2019
ST. LOUIS
1997
GROUND LEASE (2056)
19.7
169,982
89.2
HOME DEPOT
2026
2056
OFFICE DEPOT
2015
2025
ST. LOUIS
1997
GROUND LEASE (2035)
37.7
172,165
100.0
KMART
2024
2035
K&G MEN'S COMPANY
2017
2027
ST. LOUIS
1997
GROUND LEASE (2040)
16.3
128,765
100.0
KMART
2024
2040
ST. PETERS
1997
GROUND LEASE (2094)
14.8
175,121
98.6
HOBBY LOBBY
2014
2024
GART SPORTS
2014
2029
OFFICE DEPOT
2019
NEBRASKA
OMAHA (4)
2005
JOINT VENTURE
57.7
141,000
100.0
MARSHALLS
2016
2036
LINENS N THINGS
2017
2032
OFFICEMAX
2017
2032
NEVADA
CARSON CITY (6)
2006
FEE
9.4
114,258
88.8
RALEY'S
2012
2027
ELKO (6)
2006
FEE
31.3
170,756
96.5
RALEY'S
2017
2032
BUILDERS MART
2011
2016
CINEMA 4 THEATRES
2012
HENDERSON (4)
1999
JOINT VENTURE
32.1
161,000
100.0
LEVITZ
2013
2023
BIG LOTS
2016
2036
SAVERS
2016
2036
HENDERSON (6)
2006
FEE
10.5
130,773
82.3
ALBERTSONS
2009
2039
LAS VEGAS (6)
2006
FEE
34.8
362,758
96.5
WAL-MART
2012
2037
COLLEENS CLASSICS
2010
24 HOUR FITNESS
2012
2022
LAS VEGAS (6)
2006
FEE
34.5
333,236
90.1
VONS
2011
2041
CARPETS-N-MORE
2015
2025
TJ MAXX
2010
2020
LAS VEGAS (6)
2006
FEE
21.1
228,279
98.6
UA THEATRES
2017
2037
LINENS N' THINGS
2012
2027
OFFICEMAX
2012
2032
LAS VEGAS (6)
2006
FEE
16.4
169,160
92.4
FOOD 4 LESS
2011
2036
HOLLYWOOD VIDEO
2011
2016
LAS VEGAS (6)
2006
FEE
16.1
160,842
79.8
SPORTS AUTHORITY
2008
2018
OFFICEMAX
2011
2021
DOLLAR DISCOUNT CENTER
2015
2025
LAS VEGAS (6)
2006
FEE
9.4
111,245
90.1
VONS
2009
2034
DOLLAR TREE
2011
2016
CYCLE GEAR
2010
LAS VEGAS (6)
2006
FEE
7.0
77,650
98.7
ALBERTSONS
2021
2046
RENO
2006
FEE
2.7
31,710
92.2
RENO
2006
FEE
3.1
36,627
66.0
RENO (6)
2006
FEE
10.4
142,604
97.8
SAK 'N SAVE
2022
2052
WENDY'S
2008
2023
RENO (6)
2006
FEE
12.3
113,376
94.7
SCOLARI'S WAREHOUSE MARKET
2021
RENO (8)
2007
JOINT VENTURE
15.5
120,004
95.0
RALEY'S
2022
2037
SHELL OIL
2012
2022
RENO (8)
2007
JOINT VENTURE
13.2
104,319
98.8
RALEY'S
2030
2060
RENO (8)
2007
JOINT VENTURE
14.5
146,501
99.0
BED BATH & BEYOND
2015
2030
WILD OATS MARKETS
2023
2038
BORDERS BOOKS
2014
2034
SPARKS
2002
FEE
10.3
119,601
100.0
SAFEWAY
2028
2058
LONGS DRUG STORES
2054
SPARKS (8)
2007
JOINT VENTURE
10.3
113,743
94.7
RALEY'S
2023
2038
WINNEMUCCA (6)
2006
FEE
4.8
65,424
100.0
RALEY'S
2015
2035
25
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
NEW HAMPSHIRE
NASHUA (11)
2004
JOINT VENTURE
18.2
182,348
97.3
DSW SHOE WAREHOUSE
2011
2031
BED BATH & BEYOND
2012
2032
MICHAELS
2012
2027
NEW LONDON
2005
FEE
9.5
106,470
100.0
HANNAFORD BROS.
2025
2050
FIRST COLONIAL
2008
2028
MACKENNA'S
2012
2017
SALEM
1994
FEE
39.8
344,076
100.0
KOHL'S
2013
SHAW'S SUPERMARKET
2008
2038
BOB'S STORES
2011
2021
NEW JERSEY
CHERRY HILL (10)
2007
JOINT VENTURE
48.0
209,185
100.0
KOHL'S
2018
2068
WORLDWIDE WHOLESALE FLOOR
2018
2033
BABIES R US
2013
2033
EDGEWATER (6)
2007
JOINT VENTURE
45.7
423,315
95.7
TARGET
2022
2042
PATHMARK
2016
2041
TJ MAXX
2012
2022
MOORESTOWN (9)
2004
GROUND LEASE (2066)/ JOINT VENTURE
22.7
201,351
100.0
LOWE'S HOME CENTER
2026
2066
SPORTS AUTHORITY
2013
2033
BALLY TOTAL FITNESS
2012
2022
WAYNE (9)
2004
FEE
19.2
331,528
100.0
COSTCO
2009
2044
LACKLAND STORAGE
2012
2032
SPORTS AUTHORITY
2012
2032
BRIDGEWATER (7)
2001
JOINT VENTURE
16.6
378,567
100.0
BED BATH & BEYOND
2010
2030
MARSHALLS
2009
2024
COSTCO
2019
2049
DELRAN (7)
2000
JOINT VENTURE
10.5
77,583
100.0
PETSMART
2016
2026
OFFICE DEPOT
2016
2026
SLEEPY'S
2012
2022
DELRAN (7)
2005
JOINT VENTURE
9.5
37,679
45.4
BAYONNE
2004
FEE
0.6
23,901
100.0
DOLLAR TREE
2014
CHERRY HILL
1985
JOINT VENTURE
18.6
124,750
100.0
STOP & SHOP
2016
2036
RETROFITNESS
2013
2020
CHERRY HILL
1996
GROUND LEASE (2036)
15.2
129,809
100.0
KOHL'S
2016
2036
PLANET FITNESS
2017
2027
CINNAMINSON
1996
FEE
13.7
121,852
84.1
VF OUTLET
2009
2019
ACME MARKETS
2047
EAST WINDSOR
2002
FEE
34.8
249,029
98.8
TARGET
2027
2067
GENUARDI'S
2026
2056
TJ MAXX
2011
2026
HOLMDEL (3)
2007
FEE
30.0
300,011
93.2
A&P
2013
2043
MARSHALLS
2013
2028
LA FITNESS
2021
2036
HOLMDEL
2007
FEE
23.5
234,557
100.0
LINENS N THINGS
2018
2033
BEST BUY
2018
2033
MICHAELS
2013
2033
HILLSBOROUGH
2005
JOINT VENTURE
5.0
55,552
100.0
KMART
2012
2047
LINDEN
2002
FEE
0.9
13,340
100.0
STRAUSS DISCOUNT AUTO
2023
2033
NORTH BRUNSWICK
1994
FEE
38.1
409,879
100.0
WAL-MART
2018
2058
BURLINGTON COAT FACTORY
2012
MARSHALLS
2012
2027
PISCATAWAY
1998
FEE
9.6
97,348
100.0
SHOPRITE
2014
2024
RIDGEWOOD
1994
FEE
2.7
24,280
100.0
FRESH FIELDS
2015
2030
WESTMONT
1994
FEE
17.4
192,254
74.8
SUPER FRESH
2017
2081
SUPER FITNESS
2009
JO-ANN FABRICS
2012
UNION COUNTY (4)
2007
JOINT VENTURE
22.0
90,000
100.0
NEW MEXICO
LAS CRUCES
2006
JOINT VENTURE
3.9
-
-
ALBUQUERQUE
1998
FEE
4.7
37,442
100.0
PETSMART
2017
2037
ALBUQUERQUE
1998
FEE
26.0
183,796
97.2
MOVIES WEST
2011
2021
ROSS DRESS FOR LESS
2011
2021
VALLEY FURNITURE
2008
2017
ALBUQUERQUE
1998
FEE
4.8
59,722
88.9
PAGE ONE
2008
2013
WALGREENS
2027
NEW YORK
HARRIMAN (8)
2007
JOINT VENTURE
52.9
227,939
100.0
KOHL'S
2023
2003
LINENS N THINGS
2013
2028
STAPLES
2013
2028
FARMINGDALE (8)
2006
JOINT VENTURE
56.5
415,469
99.2
HOME DEPOT
2030
2075
DAVE & BUSTER'S
2010
2025
BED BATH & BEYOND
2014
2034
NESCONSET (9)
2004
FEE
5.9
55,580
100.0
LEVITZ
2014
2034
WESTBURY (9)
2004
FEE
30.1
398,602
100.0
COSTCO
2009
2043
WAL-MART
2019
2069
MARSHALLS
2009
2024
BROOKLYN (7)
2000
JOINT VENTURE
5.1
80,708
100.0
HOME DEPOT
2022
2051
WALGREENS
2030
COPIAGUE (7)
1998
JOINT VENTURE
15.4
163,999
100.0
HOME DEPOT
2011
2056
BALLY TOTAL FITNESS
2008
2018
HEMPSTEAD (7)
2000
JOINT VENTURE
1.4
13,905
100.0
WALGREENS
2059
FREEPORT (7)
2000
JOINT VENTURE
9.6
173,031
93.9
STOP & SHOP
2025
TOYS "R" US
2020
2040
MARSHALLS
2011
2016
GLEN COVE (7)
2000
JOINT VENTURE
3.0
49,346
100.0
STAPLES
2014
2029
ANNIE SEZ
2011
2026
LATHAM (7)
1999
JOINT VENTURE
89.4
616,130
99.7
SAM'S CLUB
2013
2043
WAL-MART
2013
2043
HOME DEPOT
2031
2071
MUNSEY PARK (7)
2000
JOINT VENTURE
6.0
72,748
100.0
BED BATH & BEYOND
2012
2022
WHOLE FOODS
2011
2021
MERRICK (7)
2000
JOINT VENTURE
7.8
107,871
89.6
WALDBAUMS
2013
2041
ANNIE SEZ
2011
2021
PARTY CITY
2012
2022
MIDDLETOWN (7)
2000
JOINT VENTURE
10.1
80,000
100.0
BEST BUY
2016
2031
LINENS N THINGS
2016
2031
STATEN ISLAND (7)
2000
JOINT VENTURE
14.4
190,131
100.0
TJ MAXX
2010
2025
NATIONAL WHOLESALE
2010
2030
MICHAELS
2011
2031
AMHERST
1988
JOINT VENTURE
7.5
101,066
100.0
TOPS SUPERMARKET
2013
2033
BUFFALO
1988
JOINT VENTURE
9.2
141,466
92.1
TOPS SUPERMARKET
2012
2037
PETSMART
2017
2032
FASHION BUG
2010
2025
BRONX
1990
JOINT VENTURE
19.5
228,638
100.0
NATIONAL AMUSEMENTS
2011
2036
WALDBAUMS
2011
2046
OFFICE OF HEARING
2008
LEVITTOWN
2006
JOINT VENTURE
4.7
47,214
100.0
FILENE'S BASEMENT
2021
DSW SHOE WAREHOUSE
2021
2036
BRIDGEHAMPTON
1973
FEE
30.2
287,587
98.3
KMART
2019
2039
KING KULLEN
2015
2035
TJ MAXX
2012
2017
BROOKLYN
2003
FEE
0.2
7,500
100.0
BROOKLYN
2003
FEE
0.4
10,000
100.0
RITE AID
2019
BROOKLYN
2004
FEE
0.2
29,671
100.0
DUANE READE
2014
BROOKLYN
2004
FEE
2.9
41,076
100.0
DUANE READE
2014
PC RICHARD & SON
2018
2028
BAYRIDGE
2004
FEE
0.5
21,106
100.0
DUANE READE
2014
BELLMORE
2004
FEE
1.4
24,802
100.0
RITE AID
2014
BRONX
2005
FEE
0.1
3,720
100.0
BROOKLYN
2005
FEE
0.2
5,200
100.0
BAYSHORE
2006
FEE
15.9
176,622
100.0
BEST BUY
2016
2031
TOYS "R" US
2013
2043
OFFICE DEPOT
2011
2026
COMMACK
1998
GROUND LEASE (2085)
35.7
265,409
97.4
KING KULLEN
2017
2047
LINENS N THINGS
2018
2038
SPORTS AUTHORITY
2017
2037
CENTEREACH
1993
JOINT VENTURE
40.7
377,584
98.9
WAL-MART
2015
2044
BIG LOTS
2011
2021
MODELL'S
2019
2029
CENTEREACH
2006
FEE
10.5
107,693
95.2
PATHMARK
2020
2050
ACE HARDWARE
2017
2027
COMMACK
2007
FEE
2.5
24,617
42.6
ELMONT
2004
FEE
1.8
27,078
100.0
DUANE READE
2014
ELMONT
2007
JOINT VENTURE
1.3
12,900
100.0
CVS
2033
2040
FRANKLIN SQUARE
2004
FEE
1.4
17,864
100.0
DUANE READE
2014
FLUSHING
2007
FEE
2.2
22,416
100.0
FRUIT VALLEY PRODUCE
2011
HAMPTON BAYS
1989
FEE
8.2
70,990
100.0
MACY'S
2015
2025
HICKSVILLE
2004
FEE
2.5
35,581
70.5
DUANE READE
2014
HUNTINGTON
2007
FEE
0.9
9,900
100.0
HOLTSVILLE
2007
FEE
0.8
1,595
100.0
JAMAICA
2005
FEE
0.3
5,770
100.0
JERICHO
2007
FEE
6.4
64,137
90.3
WHOLE FOODS MARKET
2025
2040
JERICHO
2007
FEE
5.7
57,013
100.0
MARSHALLS
2009
2019
JERICHO
2007
GROUND LEASE (2045)
0.2
2,085
100.0
JERICHO
2007
FEE
2.5
105,851
100.0
MILLERIDGE INN
2022
2042
LITTLE NECK
2003
FEE
3.8
48,275
100.0
LAURELTON
2005
FEE
0.2
7,435
100.0
MANHASSET
1999
FEE
9.6
188,608
100.0
FILENE'S
2011
LINENS N THINGS
2016
2026
KING KULLEN
2024
2052
MASPETH
2004
FEE
1.1
22,500
100.0
DUANE READE
2014
NORTH MASSAPEQUA
2004
GROUND LEASE (2033)
2.0
29,610
100.0
DUANE READE
2014
MANHATTAN
2005
FEE
0.2
9,566
100.0
MINEOLA
2007
FEE
2.7
26,780
79.5
CVS
2011
2026
OCEANSIDE
2003
FEE
0.3
-
-
PLAINVIEW
1969
GROUND LEASE (2070)
7.0
88,222
100.0
FAIRWAY STORES
2017
2037
POUGHKEEPSIE
1972
FEE
20.0
167,668
98.2
STOP & SHOP
2020
2049
BIG LOTS
2012
2017
QUEENS VILLAGE
2005
FEE
0.5
14,649
100.0
STRAUSS DISCOUNT AUTO
2015
2025
SYOSSET
1967
FEE
2.5
32,124
100.0
NEW YORK SPORTS CLUB
2016
2021
STATEN ISLAND
1989
FEE
16.7
210,825
100.0
KMART
2011
PATHMARK
2011
2021
STATEN ISLAND
1997
GROUND LEASE (2072)
7.0
101,337
100.0
WALDBAUMS
2011
2031
STATEN ISLAND
2006
FEE
23.9
356,779
97.9
KMART
2012
2017
PATHMARK
2012
2037
TOYS "R" US
2015
STATEN ISLAND
2005
FEE
5.5
47,270
100.0
STAPLES
2008
2018
ROCHESTER
1993/ 1988
FEE
18.6
185,153
32.0
TOPS SUPERMARKET
2009
2024
WHITE PLAINS
2004
FEE
2.5
24,577
98.8
DUANE READE
2014
YONKERS
1995
FEE
4.1
43,560
100.0
SHOPRITE
2013
2028
YONKERS
2005
FEE
0.9
10,329
100.0
STRAUSS DISCOUNT AUTO
2015
2025
26
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
CENTRAL ISLIP (4)
2004
GROUND LEASE (2101)/ JOINT VENTURE
11.8
52,000
100.0
EAST NORTHPORT (4)
2005
GROUND LEASE (2052)/ JOINT VENTURE
4.0
-
-
HARLEM (4)
2007
JOINT VENTURE
1.9
-
-
BRONX (4)
2007
JOINT VENTURE
0.7
-
-
BRONX (4)
2007
JOINT VENTURE
0.4
-
-
NEW YORK (4)
2007
JOINT VENTURE
0.6
-
-
NORTH CAROLINA
CARY (7)
2001
JOINT VENTURE
40.3
315,797
100.0
BJ'S
2020
2040
KOHL'S
2022
2001
PETSMART
2016
2036
DURHAM (7)
2002
JOINT VENTURE
39.5
408,292
100.0
WAL-MART
2015
2035
BEST BUY
2011
2026
LINENS N THINGS
2011
2026
PINEVILLE (13)
2003
JOINT VENTURE
39.1
269,710
98.5
KMART
2017
2067
STEIN MART
2012
TJ MAXX
2013
2018
CHARLOTTE
1968
FEE
13.5
62,300
100.0
TJ MAXX
2012
2017
CVS
2015
2035
CHARLOTTE
1993
FEE
14.0
139,269
94.2
BI-LO
2009
2029
RUGGED WEARHOUSE
2013
2018
DECORATORS WAREHOUSE
2012
2022
CHARLOTTE
1986
GROUND LEASE (2048)
18.4
233,800
100.0
ROSS DRESS FOR LESS
2015
2035
K&G MEN'S COMPANY
2008
2018
OFFICEMAX
2009
2024
CARY
1996
FEE
10.6
86,015
100.0
BED BATH & BEYOND
2010
2014
DICK'S SPORTING GOODS
2014
2029
CARY
1998
FEE
10.9
102,787
75.9
LOWES FOOD
2017
2037
DURHAM
1996
FEE
13.2
116,186
95.2
TJ MAXX
2009
2014
JO-ANN FABRICS
2010
2020
FRANKLIN
1998
JOINT VENTURE
2.6
26,326
100.0
BILL HOLT FORD
2016
2041
MORRISVILLE
2007
FEE
24.2
169,901
99.4
CARMIKE CINEMAS
2017
2027
FOOD LION
2019
2039
STEIN MART
2017
2037
MOORSEVILLE
2007
FEE
29.3
172,599
88.1
BEST BUY
2018
2038
BED BATH & BEYOND
2018
2038
STAPLES
2022
2037
RALEIGH
1993
FEE
35.9
362,945
90.2
GOLFSMITH GOLF & TENNIS
2017
2027
BED BATH & BEYOND
2016
2036
ROSS DRESS FOR LESS
2016
2036
WINSTON-SALEM
1969
FEE
13.2
137,433
96.5
HARRIS TEETER
2016
2041
DOLLAR TREE
2011
2016
SPORTSMAN'S SUPPLY
2008
KNIGHTDALE (4)
2005
JOINT VENTURE
29.2
201,000
100.0
ROSS DRESS FOR LESS
2017
2037
BED BATH & BEYOND
2017
2037
MICHAELS
2016
2036
RALEIGH (4)
2006
JOINT VENTURE
8.8
9,000
100.0
RALEIGH (4)
2003
JOINT VENTURE
35.4
93,000
100.0
FOOD LION
2023
2043
ACE HARDWARE
2022
2037
OHIO
CINCINNATI (7)
2000
JOINT VENTURE
36.7
410,010
92.7
WAL-MART
2010
2040
HOBBY LOBBY
2015
2025
DICK'S SPORTING GOODS
2016
2031
COLUMBUS (7)
2002
JOINT VENTURE
36.5
254,152
97.2
LOWE'S HOME CENTER
2016
2046
KROGER
2017
2037
COLUMBUS (7)
1998
JOINT VENTURE
12.1
112,862
89.2
BORDERS BOOKS
2018
2038
PIER 1 IMPORTS
2012
2017
FRANNYS HALLMARK
2009
2014
HUBER HEIGHTS (7)
1999
JOINT VENTURE
40.0
318,468
100.0
ELDER BEERMAN
2014
2044
KOHL'S
2015
2035
MARSHALLS
2009
2024
SPRINGDALE (7)
2000
JOINT VENTURE
22.0
253,510
73.5
WAL-MART
2015
2045
HH GREGG
2012
2017
DAVID'S BRIDAL
2009
2019
AKRON
1975
FEE
6.9
75,866
100.0
GIANT EAGLE
2021
2041
AKRON
1988
FEE
24.5
138,363
100.0
GABRIEL BROTHERS
2010
2025
PAT CATANS CRAFTS
2013
ESSENCE BEAUTY MART
2014
BARBERTON
1972
FEE
10.0
101,801
96.7
GIANT EAGLE
2027
2052
BRUNSWICK
1975
FEE
20.0
171,223
97.7
KMART
2010
2050
MARC'S
2017
2027
BEAVERCREEK
1986
FEE
18.2
97,307
98.2
KROGER
2018
2048
REVCO
2008
2027
CANTON
1972
FEE
19.6
172,419
87.1
BURLINGTON COAT FACTORY
2018
2043
TJ MAXX
2012
2017
HOMETOWN BUFFET
2010
2020
CAMBRIDGE
1997
FEE
13.1
78,065
93.3
TRACTOR SUPPLY CO.
2010
2020
COLUMBUS
1988
FEE
12.4
191,089
100.0
KOHL'S
2011
2031
KROGER
2031
2071
TOYS R US
2015
2040
COLUMBUS
1988
FEE
13.7
142,743
100.0
KOHL'S
2011
2031
STAPLES
2010
2020
COLUMBUS
1988
FEE
17.9
129,008
96.0
KOHL'S
2011
2031
GRANT METHODIST HOSPITAL
2011
CENTERVILLE
1988
FEE
15.2
125,058
100.0
BED BATH & BEYOND
2017
2032
THE TILE SHOP
2014
2024
HOME 2 HOME
2013
2018
COLUMBUS
1988
FEE
12.4
135,650
100.0
KOHL'S
2011
2031
CIRCUIT CITY
2019
2039
CINCINNATI
1988
FEE
11.6
223,731
99.3
LOWE'S HOME CENTER
2022
2052
BIG LOTS
2009
2019
AJ WRIGHT
2014
2034
CINCINNATI
1988
GROUND LEASE (2054)
8.8
121,242
100.0
TOYS "R" US
2019
2044
CINCINNATI
1988
FEE
29.2
308,277
100.0
HOBBY LOBBY
2012
2022
TOYS R US
2016
2046
HAVERTY'S
2019
2034
CINCINNATI
2000
FEE
8.8
88,317
100.0
HOBBY LOBBY
2011
2021
GOLD'S GYM
2017
2027
CINCINNATI
1999
FEE
16.7
89,742
92.1
BIGGS FOODS
2008
2028
DAYTON
1969
FEE
22.8
163,131
81.6
BEST BUY
2008
2028
BIG LOTS
2013
2018
JO-ANN FABRICS
2012
DAYTON
1984
FEE
32.1
213,853
88.5
VICTORIA'S SECRET
2009
2019
KROGER
2012
2038
CARDINAL FITNESS
2017
2027
TROTWOOD
1988
FEE
16.9
141,616
100.0
VALUE CITY
2010
2020
DOLLAR GENERAL
2012
DAYTON
1988
FEE
11.2
116,374
88.3
VALUE CITY
2010
2015
KENT
1988/ 1991
FEE
17.6
106,500
100.0
TOPS SUPERMARKET
2026
2096
MENTOR
1987
FEE
20.6
103,910
100.0
GABRIEL BROTHERS
2013
2028
BIG LOTS
2014
2034
MIDDLEBURG HEIGHTS
1988
FEE
8.2
104,342
100.0
GABRIEL BROTHERS
2014
2029
MENTOR
1988
FEE
25.0
235,577
95.9
GIANT EAGLE
2019
2029
BURLINGTON COAT FACTORY
2014
JO-ANN FABRICS
2009
2019
MIAMISBURG
1999
FEE
0.6
6,000
57.5
NORTH OLMSTEAD
1988
FEE
11.7
99,862
100.0
TOPS SUPERMARKET
2026
2096
SHARONVILLE
1977
GROUND LEASE (2076)/JOINT VENTURE
15.0
121,105
92.6
GABRIEL BROTHERS
2012
2032
KROGER
2008
2028
UNITED ART AND EDUCATION
2016
2026
UPPER ARLINGTON
1969
FEE
13.3
160,702
78.6
TJ MAXX
2011
2021
HONG KONG BUFFET
2011
2016
CVS
2019
2039
WESTERVILLE
1993/ 1988
FEE
25.4
222,077
100.0
KOHL'S
2016
2036
MARC'S
2015
2025
OFFICEMAX
2014
2024
WICKLIFFE
1982
FEE
10.0
128,180
95.6
GABRIEL BROTHERS
2013
2028
BIG LOTS
2010
DOLLAR GENERAL
2008
WILLOUGHBY HILLS
1988
FEE
14.1
157,424
100.0
VF OUTLET
2012
2022
MARCS DRUGS
2012
2017
OKLAHOMA
OKLAHOMA CITY
1997
FEE
9.8
103,027
100.0
ACADEMY SPORTS & OUTDOORS
2014
2024
OKLAHOMA CITY
1998
FEE
19.8
233,797
100.0
HOME DEPOT
2014
2044
GORDMANS
2013
2033
BEST BUY
2013
2023
SOUTH TULSA
1996
FEE
0.4
4,090
100.0
OREGON
MEDFORD (6)
2006
FEE
30.1
335,043
94.5
SEARS
2014
2044
TINSELTOWN
2017
2037
24 HOUR FITNESS
2015
2026
GRESHAM (6)
2006
FEE
25.6
264,765
90.5
G.I. JOE'S
2037
2087
PETSMART
2013
2028
ROSS DRESS FOR LESS
2018
HILLSBORO (6)
2006
FEE
20.0
260,954
97.8
SAFEWAY
2014
2044
STAPLES
2013
RITE AID
2014
2044
CLACKAMAS (6)
2007
JOINT VENTURE
23.7
236,672
100.0
GART SPORTS
2014
2034
NORDSTROM RACK
2008
2018
OLD NAVY
2010
HILLSBORO (6)
2006
FEE
20.0
210,992
88.2
SAFEWAY
2010
2045
RITE AID
2010
2040
TRADER JOE'S
2017
2032
GRESHAM (6)
2006
FEE
0.3
208,276
97.6
WILD OATS MARKETS
2020
2033
OFFICE DEPOT
2012
2017
BIG LOTS
2012
2017
MILWAUKIE (6)
2006
GROUND LEASE (2041)
16.3
185,859
94.6
ALBERTSONS
2013
RITE AID
2015
JO-ANN FABRICS
2008
2018
HERMISTON (6)
2006
GROUND LEASE (2046)
14.2
150,396
90.3
SAFEWAY
2008
2038
BIG LOTS
2013
2018
DOLLAR TREE
2011
2021
CANBY (6)
2006
FEE
9.1
115,701
98.3
SAFEWAY
2023
2083
RITE AID
2014
2044
CANBY ACE HARDWARE
2015
2030
PORTLAND (6)
2006
FEE
10.6
115,057
97.3
SAFEWAY
2017
2047
DOLLAR TREE
2012
2017
PORTLAND (6)
2006
FEE
1.5
112,755
84.5
STAPLES
2015
2030
WALGREENS
2021
2060
ALBANY (6)
2006
FEE
13.3
109,891
100.0
RITE AID
2008
2053
BIG LOTS
2008
2023
DOLLAR TREE
2008
2020
HOOD RIVER (6)
2006
FEE
8.3
108,554
95.1
ROSAUERS
2021
2039
WALGREENS
2032
2052
DOLLAR TREE
2011
2021
GRESHAM (6)
2006
FEE
0.7
107,583
100.0
FOOD 4 LESS
2009
2019
CASCADE ATHLETIC CLUB
2008
2018
TROUTDALE (6)
2006
FEE
9.8
98,137
55.7
LAMBS THRIFTWAY
2021
2031
SPRINGFIELD (6)
2006
FEE
8.7
96,027
96.1
SAFEWAY
2008
2043
GRESHAM (6)
2006
FEE
8.0
92,872
84.1
DOLLAR TREE
2011
2021
VOLUNTEERS OF AMERICA
2012
2017
PORTLAND (6)
2006
FEE
2.1
38,363
98.3
QFC
2019
2044
ALBANY
2006
JOINT VENTURE
3.8
22,700
100.0
GROCERY OUTLET
2016
2030
PENNSYLVANIA
MONROEVILLE (8)
2005
FEE
13.7
143,200
94.4
PETSMART
2019
2034
BED BATH & BEYOND
2020
2034
MICHAELS
2009
2029
HORSHAM (8)
2005
JOINT VENTURE
8.3
75,206
97.6
GIANT FOOD
2022
2052
CARLISLE (8)
2005
JOINT VENTURE
12.2
90,289
88.4
GIANT FOOD
2016
2046
PITTSBURGH (6)
2007
JOINT VENTURE
19.3
133,697
84.0
ECKERD
2013
2018
MONTGOMERY (7)
2002
JOINT VENTURE
45.0
257,565
100.0
GIANT FOOD
2020
2050
BED BATH & BEYOND
2016
2030
COMPUSA
2014
2028
POTTSTOWN (12)
2004
JOINT VENTURE
15.7
161,727
95.5
GIANT FOOD
2014
2049
TRACTOR SUPPLY CO.
2012
2027
TJ MAXX
2009
2019
SHREWSBURY (13)
2004
JOINT VENTURE
21.2
94,706
100.0
GIANT FOOD
2023
2053
PITTSBURGH (13)
2007
JOINT VENTURE
37.0
166,786
94.5
LINENS N THINGS
2016
2030
TJ MAXX
2010
2020
STAPLES
2015
2030
GREENSBURG
2002
JOINT VENTURE
5.0
50,000
100.0
TJ MAXX
2010
2020
MICHAELS
2010
2020
WHITEHALL
2005
JOINT VENTURE
15.1
151,418
100.0
GIANT FOOD
2014
BARNES & NOBLE
2011
PARTY CITY
2010
ARDMORE
2007
FEE
18.8
320,367
96.1
MACY'S
2012
2032
BANANA REPUBLIC
2008
2013
27
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
PITTSBURGH
2004
GROUND LEASE (2095)
46.8
467,927
100.0
CHIPPEWA
2000
FEE
22.4
215,206
100.0
KMART
2018
2068
HOME DEPOT
2018
2068
SCOTT TOWNSHIP
2000
GROUND LEASE (2052)
6.9
69,288
100.0
WAL-MART
2032
2052
BLUE BELL
1996
FEE
17.7
120,211
100.0
KOHL'S
2016
2036
HOME GOODS
2013
2033
CHAMBERSBURG
2007
FEE
12.9
131,623
97.9
GIANT FOOD
2040
2040
WINE & SPIRITS SHOPPE
2011
2016
CHAMBERSBURG
2006
FEE
37.3
271,411
98.2
KOHL'S
2028
2058
GIANT FOOD
2027
2067
MICHAELS
2017
2037
EAST STROUDSBURG
1973
FEE
15.3
168,506
100.0
KMART
2012
2022
WEIS MARKETS
2008
EAGLEVILLE
1973
FEE
15.2
165,385
93.4
KMART
2009
2024
GENUARDI'S
2011
2025
EXTON
1990
FEE
6.1
60,685
100.0
ACME MARKETS
2015
2045
EXTON
1996
FEE
9.8
85,184
100.0
KOHL'S
2016
2036
EASTWICK
1997
FEE
3.4
36,511
100.0
MERCY HOSPITAL
2017
2022
FEASTERVILLE
1996
FEE
4.6
86,575
100.0
VALUE CITY
2011
2026
GETTYSBURG
1986
FEE
2.4
14,584
100.0
RITE AID
2026
2046
HARRISBURG
1972
FEE
17.0
175,917
100.0
GANDER MOUNTAIN
2013
2028
AMERICAN SIGNATURE
2022
2032
SUPERPETZ
2012
2021
HAMBURG
2001
FEE
3.0
15,400
100.0
LEHIGH VALLEY HEALTH
2016
2026
HAVERTOWN
1996
FEE
9.0
80,938
100.0
KOHL'S
2016
2036
LANDSDALE
1996
GROUND LEASE (2037)
1.4
84,470
100.0
KOHL'S
2012
MORRISVILLE
1996
FEE
14.4
2,437
0.0
EAST NORRITON
1984
FEE
12.5
131,794
94.3
SHOPRITE
2022
2037
STAPLES
2008
JO-ANN FABRICS
2012
NEW KENSINGTON
1986
FEE
12.5
108,950
100.0
GIANT EAGLE
2016
2033
PHILADELPHIA (3)
1983
JOINT VENTURE
8.1
195,440
100.0
JCPENNEY
2012
2037
TOYS "R" US
2012
2052
PHILADELPHIA
1998
JOINT VENTURE
7.5
75,303
100.0
NORTHEAST AUTO OUTLET
2015
2050
PHILADELPHIA (3)
1995
JOINT VENTURE
22.6
211,947
94.3
SUPER FRESH
2022
2047
PETSMART
2011
2016
PEP BOYS
2009
2014
PHILADELPHIA
1996
FEE
6.3
82,345
100.0
KOHL'S
2016
2036
PHILADELPHIA
1996
GROUND LEASE (2035)
6.8
133,309
100.0
KMART
2010
2035
PHILADELPHIA
2005
FEE
0.4
9,343
100.0
PHILADELPHIA
2006
JOINT VENTURE
18.0
294,309
98.0
SEARS
2019
2039
RICHBORO
1986
FEE
14.5
107,957
100.0
SUPER FRESH
2018
2058
SPRINGFIELD
1983
FEE
19.7
212,188
90.9
VALUE CITY
2013
2043
STAPLES
2013
2023
UPPER DARBY
1996
JOINT VENTURE
16.3
4,808
0.0
WEST MIFFLIN
1986
FEE
8.3
84,279
100.0
BIG LOTS
2012
2032
WHITEHALL
1996
GROUND LEASE (2081)
6.0
84,524
100.0
KOHL'S
2016
2036
YORK
1986
FEE
13.7
58,244
95.2
SAVE-A-LOT
2014
2029
ADVANCE AUTO PARTS
2012
2017
YALE ELECTRIC
2010
2011
YORK
1986
FEE
3.3
35,500
100.0
GIANT FOOD
2012
2017
PUERTO RICO
BAYAMON
2001
FEE
16.5
186,400
97.6
AMIGO SUPERMARKET
2027
2047
OFFICEMAX
2015
2030
CHUCK E CHEESE
2013
2023
CAGUAS
2006
FEE
44.9
576,348
95.9
COSTCO
2026
2046
SAM'S CLUB
2019
2070
OFFICEMAX
2010
2025
CAROLINA
2006
FEE
51.3
570,610
98.2
HOME DEPOT
2026
2046
KMART
2019
2069
OFFICEMAX
2010
2025
MAYAGUEZ
2006
FEE
32.5
348,593
99.0
HOME DEPOT
2026
2046
SAM'S CLUB
2019
2069
CARIBBEAN CINEMA
2028
2038
MANATI
2006
FEE
6.7
69,640
95.7
GRANDE SUPERMARKET
2009
PONCE
2006
FEE
12.1
192,701
95.1
2000 CINEMA CORP.
2032
2052
SUPERMERCADOS MAXIMO
2026
2046
DAVID'S BRIDAL
2011
2021
TRUJILLO ALTO
1979
FEE
20.1
199,513
100.0
KMART
2009
2054
PUEBLO SUPERMARKET
2014
2024
FARMACIAS EL AMAL
2015
RHODE ISLAND
CRANSTON
1998
FEE
11.0
129,907
89.0
BOB'S STORES
2013
2028
MARSHALLS
2011
2021
PROVIDENCE
2003
GROUND LEASE (2072)/JOINT VENTURE
17.0
71,735
86.5
STOP & SHOP
2022
2072
SOUTH CAROLINA
GREENVILLE (9)
2004
FEE
31.8
295,928
95.4
INGLES MARKETS
2021
2076
GOODY'S FAMILY CLOTHING
2010
2025
TJ MAXX
2010
2025
CHARLESTON
1978
FEE
17.6
171,735
98.1
STEIN MART
2011
2016
FLOOR IT NOW
2012
TUESDAY MORNING
2015
2021
CHARLESTON
1995
FEE
17.2
186,740
98.7
TJ MAXX
2009
2014
OFFICE DEPOT
2011
2016
MARSHALLS
2011
FLORENCE
1997
FEE
21.0
113,922
81.8
HAMRICKS
2011
STAPLES
2010
2035
DOLLAR TREE
2013
2018
GREENVILLE
1997
FEE
20.4
148,532
94.9
STEVE & BARRY'S UNIVERSITY
2014
2021
BABIES R US
2012
2022
NORTH CHARLESTON
2000/ 1997
FEE
27.2
266,588
96.2
SPORTS AUTHORITY
2013
2033
CIRCUIT CITY
2019
2029
MARSHALLS
2013
TENNESSEE
MEMPHIS (6)
2007
JOINT VENTURE
5.5
55,297
80.0
MADISON (7)
1999
JOINT VENTURE
21.1
189,401
97.4
DICK'S SPORTING GOODS
2017
2032
BEST BUY
2014
2029
GOODY'S FAMILY CLOTHING
2010
2020
MEMPHIS (7)
2001
JOINT VENTURE
3.9
40,000
100.0
BED BATH & BEYOND
2012
2027
NASHVILLE (7)
1999
JOINT VENTURE
9.3
99,909
88.3
BEST BUY
2014
2029
OFFICEMAX
2015
2035
CHATTANOOGA
2002
JOINT VENTURE
5.0
50,000
100.0
HOME GOODS
2010
2020
MICHAELS
2017
2037
CHATTANOOGA
1973
GROUND LEASE (2074)
7.6
50,588
89.6
SAVE-A-LOT
2009
2014
MADISON
1978
GROUND LEASE (2039)
14.5
175,593
99.5
OLD TIME POTTERY
2013
2023
WAL-MART
2014
2039
MEMPHIS
2000
FEE
8.8
87,962
100.0
OLD TIME POTTERY
2010
2025
MEMPHIS
1991
FEE
14.7
167,243
87.8
TOYS "R" US
2017
2042
OFFICEMAX
2008
2028
KIDS R US
2019
2044
MADISON
2004/ 2005
FEE
25.4
240,318
94.2
JO-ANN FABRICS
2009
2024
CIRCUIT CITY
2009
2039
TJ MAXX
2010
2020
NASHVILLE
1998
FEE
10.2
109,012
88.2
TREES N TRENDS
2013
2018
OAK FACTORY OUTLET
2012
OLD COUNTRY BUFFET
2011
2016
NASHVILLE
1986
FEE
16.9
172,135
97.5
STEIN MART
2008
2013
ASHLEY FURNITURE
2012
2022
BED BATH & BEYOND
2013
2028
BELLEVUE (4)
2006
JOINT VENTURE
21.3
65,000
100.0
PUBLIX
2027
2057
TEXAS
ALLEN
2006
JOINT VENTURE
2.1
21,162
100.0
CREME DE LA CREME
2026
2046
AMARILLO (7)
1997
JOINT VENTURE
9.3
343,875
99.6
HOME DEPOT
2019
2069
KOHL'S
2025
2055
CIRCUIT CITY
2010
2035
AMARILLO (7)
2003
JOINT VENTURE
10.6
142,647
98.0
ROSS DRESS FOR LESS
2012
2037
BED BATH & BEYOND
2012
2032
JO-ANN FABRICS
2012
2032
ARLINGTON
1997
FEE
8.0
96,127
100.0
HOBBY LOBBY
2013
2018
AUSTIN
1998
FEE
15.4
157,852
94.8
HEB GROCERY
2011
2026
BROKERS NATIONAL LIFE
2013
AUSTIN
2003
JOINT VENTURE
10.8
108,028
100.0
FRY'S ELECTRONICS
2018
2048
AUSTIN (6)
2007
JOINT VENTURE
20.9
209,393
96.7
BED BATH & BEYOND
2011
2021
ROSS DRESS FOR LESS
2013
2023
TJ MAXX
2012
2017
AUSTIN (6)
2007
JOINT VENTURE
20.8
138,422
100.0
RANDALLS FOOD & DRUGS
2009
2019
AUSTIN (6)
2007
JOINT VENTURE
4.6
45,791
100.0
PRIMITIVES
2012
2017
JO-ANN FABRICS
2010
AUSTIN (7)
1998
JOINT VENTURE
18.2
191,760
77.6
CIRCUIT CITY
2017
2037
BABIES R US
2012
2027
WORLD MARKET
2011
2026
BAYTOWN
1996
FEE
8.7
91,177
100.0
HOBBY LOBBY
2008
2018
ROSS DRESS FOR LESS
2012
2032
BROWNSVILLE (4)
2005
JOINT VENTURE
27.6
198,000
100.0
MERVYN'S
2026
2046
TJ MAXX
2016
2036
MICHAELS
2017
2032
COLLEYVILLE
2006
JOINT VENTURE
2.0
20,188
100.0
CREME DE LA CREME
2026
2046
COPPELL
2006
JOINT VENTURE
2.0
20,425
100.0
CREME DE LA CREME
2026
2046
CORPUS CHRISTI
1997
GROUND LEASE (2065)
12.5
125,454
100.0
BEST BUY
2016
2030
ROSS DRESS FOR LESS
2011
2030
BED BATH & BEYOND
2018
2033
DALLAS
1969
JOINT VENTURE
75.0
-
-
BIG TOWN BOWLANES
2022
DALLAS (6)
2007
JOINT VENTURE
12.1
171,988
89.9
WHOLE FOODS MARKET
2009
2039
ULTA 3
2008
2018
DALLAS (7)
1998
JOINT VENTURE
6.8
83,867
100.0
ROSS DRESS FOR LESS
2012
2017
OFFICEMAX
2009
2024
BIG LOTS
2012
2032
EAST PLANO
1996
FEE
9.0
100,598
100.0
HOME DEPOT EXPO
2024
2054
FORT WORTH (4)
2003
JOINT VENTURE
45.5
228,000
100.0
MARSHALLS
2015
2035
ROSS DRESS FOR LESS
2017
2042
OFFICE DEPOT
2021
2041
FRISCO (4)
2006
JOINT VENTURE
38.7
163,000
100.0
HOBBY LOBBY / MARDELS
2027
2047
SPROUTS FARMERS MARKET
2022
2042
GRAND PRAIRIE (4)
2006
JOINT VENTURE
55.6
171,000
100.0
24 HOUR FITNESS
2022
2047
MARSHALLS
2017
2037
PETCO
2017
2027
HARRIS COUNTY (8)
2005
JOINT VENTURE
11.4
144,055
100.0
BEST BUY
2015
2035
LINENS N THINGS
2015
2030
BARNES & NOBLE
2014
2029
HOUSTON
1997
FEE
8.0
113,831
60.5
PALAIS ROYAL
2017
2022
HOUSTON
1999
FEE
5.6
84,188
100.0
OFFICE DEPOT
2012
2022
METROPOLITAN FURNITURE
2013
2023
EXCLUSIVE FURNITURE
2017
2022
HOUSTON
1996
FEE
8.2
96,500
100.0
BURLINGTON COAT FACTORY
2019
2034
HOUSTON (13)
2006
JOINT VENTURE
23.2
237,634
97.0
TJ MAXX
2015
2035
ROSS DRESS FOR LESS
2016
2036
BED BATH & BEYOND
2016
2041
HOUSTON (4)
2005
JOINT VENTURE
6.5
2,000
100.0
HOUSTON (8)
2006
FEE
32.0
350,398
92.8
MARSHALLS
2011
2026
BED BATH & BEYOND
2012
2032
OFFICEMAX
2014
2034
LEWISVILLE
1998
FEE
11.2
74,837
60.3
TALBOTS OUTLET
2009
2017
LEWISVILLE
1998
FEE
7.6
123,560
90.0
BABIES R US
2009
2027
BED BATH & BEYOND
2018
2033
BROYHILL HOME COLLECTIONS
2015
2025
28
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
LEWISVILLE
1998
FEE
9.4
93,668
71.2
DSW SHOE WAREHOUSE
2008
2028
PETLAND
2009
2019
LUBBOCK
1998
FEE
9.6
108,326
100.0
PETSMART
2015
2040
OFFICEMAX
2009
2029
BARNES & NOBLE
2010
2025
MESQUITE
1974
FEE
9.0
79,550
100.0
KROGER
2012
2037
MESQUITE
2006
FEE
15.0
209,766
96.2
BEST BUY
2009
2024
ASHLEY FURNITURE
2012
2017
PETSMART
2009
2026
N. BRAUNFELS
2003
JOINT VENTURE
8.6
86,479
100.0
KOHL'S
2014
2064
NORTH CONROE (13)
2006
JOINT VENTURE
28.7
266,998
100.0
FINGERS FURNITURE
2022
2042
TJ MAXX
2016
2036
ROSS DRESS FOR LESS
2017
2037
NORTH FORT WORTH (4)
2007
JOINT VENTURE
180.5
-
-
PASADENA (7)
1999
JOINT VENTURE
15.1
169,190
100.0
PETSMART
2015
2030
OFFICEMAX
2014
2029
MICHAELS
2009
2024
PASADENA (7)
2001
JOINT VENTURE
24.6
240,907
100.0
BEST BUY
2012
2027
ROSS DRESS FOR LESS
2012
2032
MARSHALLS
2012
2027
PLANO
2005
FEE
14.9
149,343
100.0
HOME DEPOT
2027
2057
RICHARDSON (7)
1998
JOINT VENTURE
11.7
115,579
79.5
OFFICEMAX
2011
2026
BALLY TOTAL FITNESS
2009
2019
FOX & HOUND
2012
2022
SOUTHLAKE
2007
FEE
3.7
37,447
96.7
TEMPLE (8)
2005
JOINT VENTURE
27.5
274,786
91.2
HOBBY LOBBY
2021
2036
ROSS DRESS FOR LESS
2012
2037
GOODY'S FAMILY CLOTHING
2011
2021
WEBSTER
2006
FEE
40.0
397,899
97.8
HOBBY LOBBY
2017
2027
OSHMAN SPORTING
2009
2024
BEL FURNITURE
2010
2015
WOODLANDS (4)
2002
JOINT VENTURE
34.0
479,000
100.0
BORDERS BOOKS
2024
2044
CINEMARK
2020
2040
TOMMY BAHAMA'S
2015
2030
UTAH
OGDEN
1967
FEE
11.4
142,628
100.0
COSTCO
2033
2073
VERMONT
MANCHESTER
2004
FEE
9.5
53,483
97.1
PRICE CHOPPERS
2011
VIRGINIA
BURKE (11)
2004
GROUND LEASE (2076)/ JOINT VENTURE
12.5
124,148
100.0
SAFEWAY
2020
2050
CVS
2021
2041
COLONIAL HEIGHTS
1996
FEE
6.1
60,909
100.0
BLOOM BROTHERS FURNITURE
2008
BOOKS-A-MILLION
2008
DUMFRIES (13)
2005
JOINT VENTURE
0.2
1,702
100.0
FAIRFAX (4)
2007
FEE
3.0
29,000
100.0
FAIRFAX (6)
2007
JOINT VENTURE
10.1
101,332
100.0
WALGREEN'S
2021
2041
TJ MAXX
2014
2024
FAIRFAX (7)
1998
JOINT VENTURE
37.0
323,262
100.0
HOME DEPOT
2013
2033
COSTCO
2011
2046
SPORTS AUTHORITY
2008
2013
FREDERICKSBURG (13)
2005
JOINT VENTURE
3.3
33,179
100.0
CIRCUIT CITY
2018
2038
FREDERICKSBURG (13)
2005
JOINT VENTURE
3.2
32,000
100.0
BASSETT FURNITURE
2019
2039
FREDERICKSBURG (13)
2005
JOINT VENTURE
1.1
11,097
100.0
NTB TIRES
2017
2037
FREDERICKSBURG (13)
2005
JOINT VENTURE
1.1
10,578
100.0
CHUCK E CHEESE
2014
2024
FREDERICKSBURG (13)
2005
JOINT VENTURE
1.0
10,125
100.0
CVS
2022
2042
FREDERICKSBURG (13)
2005
JOINT VENTURE
1.0
10,125
100.0
CVS
2019
2039
FREDERICKSBURG (13)
2005
JOINT VENTURE
1.0
10,125
100.0
SHONEY'S
2023
FREDERICKSBURG (13)
2005
JOINT VENTURE
1.0
10,002
100.0
CRACKER BARREL
2014
2034
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.8
8,027
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.8
8,000
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.8
7,993
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.7
7,256
100.0
FREDERICKSBURG (13)
2005
FEE
0.7
7,241
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.7
7,200
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.7
7,200
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.7
7,000
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.7
6,818
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.6
6,100
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.6
6,000
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.6
5,892
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.6
5,540
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.5
5,126
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.5
5,020
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.5
4,842
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.5
4,828
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.5
4,800
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.4
4,352
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.4
4,261
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.4
3,822
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.4
3,650
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.3
3,076
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.3
3,028
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.3
3,000
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.3
3,000
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.3
2,909
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.2
2,454
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.2
2,170
100.0
FREDERICKSBURG (13)
2005
JOINT VENTURE
0.2
1,762
100.0
HARRISONBURG (10) (3)
2007
JOINT VENTURE
19.0
187,534
93.7
KOHL'S
2024
2064
MARTIN'S
2027
2067
LEESBURG (6)
2007
JOINT VENTURE
27.9
316,586
100.0
SHOPPERS FOOD
2015
2060
STEIN MART
2011
2031
ROSS DRESS FOR LESS
2013
2023
MANASSAS
1997
FEE
13.5
117,525
93.7
SUPER FRESH
2011
2026
JO-ANN FABRICS
2011
MANASSAS (8)
2005
JOINT VENTURE
8.9
107,233
100.0
BURLINGTON COAT FACTORY
2009
2030
AUTOZONE
2010
2025
PENTAGON CITY (9)
2004
FEE
16.8
330,467
97.9
COSTCO
2009
2044
MARSHALLS
2010
2025
BEST BUY
2009
2024
RICHMOND
2002
FEE
8.5
84,683
100.0
BLOOM BROTHERS FURNITURE
2013
2023
RICHMOND
1995
FEE
11.5
128,612
100.0
BURLINGTON COAT FACTORY
2010
2035
RICHMOND (13)
2005
JOINT VENTURE
0.3
3,060
100.0
ROANOKE
2004
FEE
7.7
81,789
100.0
DICK'S SPORTING GOODS
2019
2034
CIRCUIT CITY
2020
2040
ROANOKE (10)
2007
JOINT VENTURE
35.7
301,689
96.2
MICHAELS
2009
2019
MARSHALLS
2013
2033
ROSS DRESS FOR LESS
2016
2036
STAFFORD (13)
2005
JOINT VENTURE
9.9
101,042
100.0
GIANT FOOD
2027
2072
STAPLES
2017
2032
PETCO SUPPLIES & FISH
2012
2027
STAFFORD (13)
2005
JOINT VENTURE
0.7
7,310
100.0
STAFFORD (13)
2005
JOINT VENTURE
0.4
4,400
100.0
STAFFORD (13)
2005
JOINT VENTURE
1.2
4,211
100.0
STAFFORD (8)
2005
JOINT VENTURE
30.8
331,730
100.0
SHOPPERS FOOD
2023
2053
TJ MAXX
2016
2036
ROSS DRESS FOR LESS
2015
2035
STERLING (12)
2003
JOINT VENTURE
38.1
361,043
100.0
TOYS "R" US
2012
2037
MICHAELS
2011
2026
CIRCUIT CITY
2017
2037
STERLING (8)
2006
JOINT VENTURE
103.3
737,503
99.6
WAL-MART
2021
2091
LOWE'S HOME CENTER
2021
2061
SAM'S CLUB
2021
2091
WOODBRIDGE
1973
GROUND LEASE (2072)/JOINT VENTURE
19.6
150,793
100.0
CAMPOS FURNITURE
2009
SALVATION ARMY
2009
2014
WEDGEWOOD ANTIQUES
2008
WOODBRIDGE (7)
1998
JOINT VENTURE
54.0
494,048
99.8
LOWE'S
2012
2032
SHOPPERS FOOD
2009
2044
BEST BUY
2010
2025
WASHINGTON
AUBURN
2007
FEE
13.7
171,032
99.1
ALBERTSONS
2018
2038
OFFICE DEPOT
2009
2029
RITE AID
2008
2028
BELLEVUE (3)
2004
JOINT VENTURE
41.6
393,428
100.0
TARGET
2012
2037
NORDSTROM RACK
2012
2032
SAFEWAY
2012
2027
BELLINGHAM (6)
2006
FEE
30.5
376,023
98.9
KMART
2009
2049
COST CUTTERS
2009
2044
JO-ANN FABRICS
2010
2025
BELLINGHAM (7)
1998
JOINT VENTURE
20.0
188,885
97.8
MACY'S
2012
2022
BEST BUY
2017
2032
BED BATH & BEYOND
2012
2027
FEDERAL WAY (7)
2000
JOINT VENTURE
17.0
200,126
94.1
QFC
2015
2045
JO-ANN FABRICS
2010
2030
BARNES & NOBLE
2011
2026
KENT (6)
2006
FEE
23.1
86,909
98.3
ROSS DRESS FOR LESS
2011
2026
KENT (6)
2006
FEE
7.2
69,090
98.3
RITE AID
2015
2035
LAKE STEVENS (6)
2006
FEE
18.6
216,132
88.2
SAFEWAY
2032
2077
G.I. JOE'S
2018
2038
MCDONALD'S
2013
2038
MILL CREEK (6)
2006
FEE
12.4
113,641
96.1
SAFEWAY
2015
2045
PENNZOIL
2018
OLYMPIA (6)
2006
FEE
15.0
167,117
93.7
ALBERTSONS
2008
2043
ROSS DRESS FOR LESS
2010
2015
OLYMPIA (6)
2006
FEE
6.7
69,212
73.4
BARNES & NOBLE
2010
2015
PETCO
2013
2023
SEATTLE (6)
2006
GROUND LEASE (2083)
3.2
146,819
84.9
SAFEWAY
2012
2037
PRUDENTIAL NW REALTY
2009
2018
BARTELL DRUGS
2012
2022
SILVERDALE (6)
2006
GROUND LEASE (2059)
14.7
170,406
100.0
SAFEWAY
2024
2059
JO-ANN FABRICS
2012
2032
RITE AID
2011
2041
SILVERDALE (6)
2006
FEE
5.1
67,287
93.8
ROSS DRESS FOR LESS
2016
2026
29
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
SPOKANE (8)
2005
JOINT VENTURE
8.3
129,785
100.0
BED BATH & BEYOND
2011
2026
ROSS DRESS FOR LESS
2009
2019
RITE AID
2009
2039
TACOMA (6)
2006
FEE
14.5
134,839
100.0
TJ MAXX
2019
GALAXY THEATRES
2008
2018
OFFICE DEPOT
2012
TUKWILA (7)
2003
JOINT VENTURE
45.9
459,071
100.0
THE BON MARCHE'
2009
2019
BEST BUY
2016
2031
GART SPORTS
2014
2029
VANCOUVER (6)
2006
FEE
6.3
69,790
95.4
SUPERMAX
2016
2026
HI SCHOOL PHARMACY
2012
2017
WEST VIRGINIA
CHARLES TOWN
1985
FEE
22.0
208,888
97.4
WAL-MART
2017
2047
STAPLES
2016
HUNTINGTON
1993
FEE
19.5
2,400
100.0
SOUTH CHARLESTON
1999
FEE
14.8
147,865
94.3
KROGER
2011
2041
TJ MAXX
2011
2021
CANADA
ALBERTA
SHOPPES @ SHAWNESSEY
2002
JOINT VENTURE
16.3
162,988
100.0
ZELLERS
2011
2096
SHAWNESSY CENTRE
2002
JOINT VENTURE
30.6
306,010
100.0
FUTURE SHOP (BEST BUY)
2009
2024
LINEN N THINGS
2015
2025
BUSINESS DEPOT (STAPLES)
2013
2028
BRENTWOOD
2002
JOINT VENTURE
31.2
311,574
98.5
CANADA SAFEWAY
2008
2032
SEARS WHOLE HOME
2010
2020
LINEN N THINGS
2016
2031
SOUTH EDMONTON COMMON
2002
JOINT VENTURE
42.9
428,745
100.0
HOME OUTFITTERS
2016
2031
LONDON DRUGS
2020
2057
MICHAELS
2011
2026
GRANDE PRAIRIE III
2002
JOINT VENTURE
6.3
63,413
100.0
MICHAELS
2011
2031
WINNERS (TJ MAXX)
2011
2026
JYSK LINEN
2012
2022
BRITISH COLUMBIA
TILLICUM
2002
JOINT VENTURE
47.3
472,528
99.1
ZELLERS
2013
2098
SAFEWAY
2023
2053
WINNERS (TJ MAXX)
2008
2023
PRINCE GEORGE
2001
JOINT VENTURE
37.3
372,725
96.3
OVERWAITEE
2018
2028
THE BAY
2013
2083
LONDON DRUGS
2017
2027
STRAWBERRY HILL
2002
JOINT VENTURE
33.8
337,931
100.0
HOME DEPOT
2016
2041
CINEPLEX ODEON
2014
2024
WINNERS (TJ MAXX)
2009
2024
MISSION
2001
JOINT VENTURE
27.1
271,462
99.4
OVERWAITEE
2018
2028
FAMOUS PLAYERS
2010
2030
LONDON DRUGS
2019
2046
ABBOTSFORD
2002
JOINT VENTURE
22.0
219,713
99.0
ZELLERS
2052
2082
PETSMART
2013
2033
WINNERS (TJ MAXX)
2008
2023
CLEARBROOK
2001
JOINT VENTURE
18.8
188,253
100.0
SAFEWAY
2008
2037
STAPLES
2012
2022
LANDMARK CINEMAS
2011
2021
SURREY
2001
JOINT VENTURE
17.1
170,725
100.0
CANADA SAFEWAY
2011
2061
LONDON DRUGS
2011
2021
LANGLEY POWER CENTER
2003
JOINT VENTURE
22.8
228,314
100.0
WINNERS (TJ MAXX)
2012
2027
MICHAELS
2011
2021
FUTURE SHOP (BEST BUY)
2012
2022
LANGLEY GATE
2002
JOINT VENTURE
15.2
151,802
100.0
SEARS
2008
2018
PETSMART
2008
2038
WINNERS (TJ MAXX)
2008
2017
ONTARIO
THICKSON RIDGE
2002
JOINT VENTURE
36.3
363,039
100.0
WINNERS (TJ MAXX)
2013
2023
FUTURE SHOP (BEST BUY)
2011
2016
SEARS WHOLE HOME
2012
2022
SHOPPERS WORLD ALBION
2002
JOINT VENTURE
38.0
380,295
100.0
CANADIAN TIRE
2014
2029
FORTINO'S
2010
2030
SHOPPERS WORLD DANFORTH
2002
JOINT VENTURE
32.8
328,198
99.6
ZELLERS
2009
2029
DOMINION
2018
2028
BUSINESS DEPOT (STAPLES)
2015
2030
LINCOLN FIELDS
2002
JOINT VENTURE
29.0
289,869
94.2
WAL MART
2010
2025
LOEB (GROUND)
2009
2024
CAA OTTAWA
2008
2015
404 TOWN CENTRE
2002
JOINT VENTURE
24.4
244,379
98.0
ZELLERS
2009
2024
A & P
2008
2027
NATIONAL GYM CLOTHING
2019
2024
SUDBURY
2002
JOINT VENTURE
23.4
234,299
100.0
FAMOUS PLAYERS
2019
2039
BUSINESS DEPOT (STAPLES)
2014
2024
CHAPTERS
2010
2030
SUDBURY
2004
JOINT VENTURE
17.0
169,524
100.0
WINNERS (TJ MAXX)
2015
2030
LINEN N THINGS
2016
2031
MICHAELS
2015
2035
CLARKSON CROSSING
2004
JOINT VENTURE
21.3
213,051
100.0
CANADIAN TIRE
2023
2043
A & P
2023
2048
GREEN LANE CENTRE
2003
JOINT VENTURE
16.0
160,195
100.0
LINEN N THINGS
2014
2029
MICHAELS
2013
2033
PETSMART
2014
2039
KENDALWOOD
2002
JOINT VENTURE
15.6
156,274
93.7
PRICE CHOPPER
2013
2038
VALUE VILLAGE
2008
2028
SHOPPERS DRUG MART
2011
2021
LEASIDE
2002
JOINT VENTURE
13.3
133,035
100.0
CANADIAN TIRE
2011
2036
FUTURE SHOP (BEST BUY)
2011
2021
PETSMART
2012
2037
DONALD PLAZA
2002
JOINT VENTURE
9.1
91,462
95.9
WINNERS (TJ MAXX)
2008
2023
ST. LAURANT
2002
JOINT VENTURE
12.6
125,984
100.0
ZELLERS
2017
2046
LOEB
2008
2023
BOULEVARD CENTRE III
2004
JOINT VENTURE
8.3
82,961
100.0
FOOD BASICS
2025
2055
RIOCAN GRAND PARK
2003
JOINT VENTURE
11.9
118,637
100.0
SHOPPERS DRUG MART
2018
2038
WINNERS (TJ MAXX)
2014
2024
BUSINESS DEPOT (STAPLES)
2011
2021
WALKER PLACE
2002
JOINT VENTURE
7.0
69,857
98.1
COMMISSO'S
2012
2032
SCARBOROUGH
2005
JOINT VENTURE
2.3
20,506
100.0
AGINCOURT NISSAN LIMITED
2020
SCARBOROUGH
2005
JOINT VENTURE
1.8
13,433
100.0
MORNINGSIDE NISSAN LIMITED
2020
TORONTO
2007
JOINT VENTURE
0.5
46,986
100.0
TRANSWORLD FINE CARS
2027
WINDSOR
2007
JOINT VENTURE
6.6
58,147
100.0
PERFORMANCE FORD SALES, INC.
2027
MARKETPLACE TORONTO
2002
JOINT VENTURE
17.1
171,088
99.6
WINNERS (TJ MAXX)
2014
2029
MARK'S WORK WEARHOUSE
2015
2025
SEARS APPLIANCE
2015
2025
PRINCE EDWARD ISLAND
CHARLOTTETOWN
2002
JOINT VENTURE
39.4
393,636
99.3
ZELLERS
2019
2079
WINNERS (TJ MAXX)
2009
2019
WEST ROYALTY FITNESS
2010
2015
QUEBEC
GREENFIELD PARK
2002
JOINT VENTURE
36.4
364,003
100.0
WINNERS (TJ MAXX)
2011
2021
BUREAU EN GROS (STAPLES)
2008
2022
GUZZO CINEMA
2019
2039
JACQUES CARTIER
2002
JOINT VENTURE
21.2
211,502
94.4
GUZZO CINEMA
2010
2040
VALUE VILLAGE
2008
2028
IGA
2012
2022
CHATEAUGUAY
2002
JOINT VENTURE
21.1
211,345
99.0
SUPER C
2008
2028
HART
2015
2025
CHILE
SANTIAGO
2007
JOINT VENTURE
2.8
27,715
78.5
SANTIAGO
2007
JOINT VENTURE
5.0
50,492
89.9
SANTIAGO
2007
JOINT VENTURE
1.3
13,487
87.1
SANTIAGO
2007
JOINT VENTURE
0.7
6,684
100.0
MEXICO
BAJA CALIFORNIA
MEXICALI
2006
FEE
12.1
121,271
99.5
CINEPOLIS
2020
MEXICALI (4)
2006
JOINT VENTURE
10.3
103,000
100.0
WAL-MART
2022
ROSARITO (4)
2007
JOINT VENTURE
41.4
147,000
100.0
HOME DEPOT
2023
CINEPOLIS
2023
TIJUANA (4)
2005
JOINT VENTURE
38.7
380,000
100.0
WAL-MART
2021
MM CINEMA
2016
COPELL
2016
TIJUANA (4)
2007
JOINT VENTURE
12.3
84,000
100.0
COMERCIAL MEXICANA
TIJUANA (4)
2007
JOINT VENTURE
50.5
165,000
100.0
WAL-MART
CINEPOLIS
2024
BAJA CALIFORNIA SUR
LOS CABOS (4)
2007
FEE
24.8
-
-
CAMPECHE
CIUDAD DEL CARMEN (4)
2007
JOINT VENTURE
24.7
81,000
100.0
CHEDRAUI GROCERY
2024
CHIAPAS
TAPACHULA (4)
2007
FEE
29.7
124,000
100.0
WAL-MART
2024
CHIHUAHUA
JUAREZ
2003
JOINT VENTURE
23.8
238,135
89.8
SORIANA
2008
JUAREZ (4)
2006
JOINT VENTURE
11.8
118,000
100.0
WAL-MART
2027
COAHUILA
CIUDAD ACUNA
2007
FEE
3.2
31,699
95.6
SABINAS
2007
FEE
1.0
10,147
100.0
SALTILLO (4)
2005
FEE
25.8
266,000
100.0
HEB
2020
SALTILLO PLAZA
2002
JOINT VENTURE
17.4
173,766
97.7
HEB
2042
DURANGO
DURANGO
2007
FEE
1.2
11,911
100.0
GUERRERO
ACAPULCO
2005
FEE
40.7
407,321
99.7
WAL-MART
2019
HIDALGO
PACHUCA (4)
2005
JOINT VENTURE
13.7
138,000
100.0
HOME DEPOT
2021
PACHUCA (4)
2005
FEE
11.2
141,000
100.0
WAL-MART
2024
JALISCO
GUADALAJARA
2005
JOINT VENTURE
13.0
129,705
83.7
WAL-MART
2026
GUADALAJARA
2006
FEE
10.0
99,717
100.0
CINEPOLIS
2019
ZARA
2011
GUADALAJARA (4)
2005
JOINT VENTURE
24.0
521,000
100.0
WAL-MART
2025
CINEPOLIS
2022
GUADALAJARA (4)
2006
FEE
17.0
170,000
100.0
WAL-MART
2021
CINEPOLIS
2024
LAGOS DE MORENO
2007
FEE
1.6
15,645
100.0
PUERTO VALLARTA
2006
JOINT VENTURE
8.6
85,874
87.6
SORIANA
2021
MEXICO
HUEHUETOCA
2004
JOINT VENTURE
17.0
170,266
95.3
WAL-MART
2014
30
LOCATION
YEAR DEVELOPED OR ACQUIRED
OWNERSHIP INTEREST/ (EXPIRATION)(2)
LAND AREA (ACRES)
LEASABLE AREA SQ. FT.)
PERCENT LEASED (1)
MAJOR LEASES
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
TENANT NAME
LEASE EXPIRATION
OPTION EXPIRATION
HUEHUETOCA (4)
2007
FEE
7.9
16,000
100.0
COPPEL
2023
TECAMAC (4)
2006
JOINT VENTURE
8.2
82,000
100.0
WAL-MART
2023
MEXICO CITY
INTERLOMAS
2007
JOINT VENTURE
24.6
246,132
98.6
GAMEWORKS
2011
ZARA
2018
IXTAPALUCA
2007
FEE
1.4
13,702
100.0
MEXICO CITY
2005
FEE
0.7
30,723
88.4
TLALNEPANTLA
2005
JOINT VENTURE
14.7
398,911
94.6
WAL-MART
2026
MORELOS
CUAUTLA (4)
2006
JOINT VENTURE
23.3
233,000
100.0
WAL-MART
2023
NAYARIT
NEUVO VALLARTA (4)
2007
FEE
19.7
129,000
100.0
WAL-MART
NUEVO LEON
ESCOBEDO (4)
2006
JOINT VENTURE
23.6
236,000
100.0
HEB
2042
MONTERREY
2002
JOINT VENTURE
26.3
262,937
95.4
HEB
2042
MONTERREY (4)
2006
FEE
19.7
197,000
100.0
HEB
2047
OAXACA
TUXTEPEC
2005
JOINT VENTURE
9.3
92,801
99.0
WAL-MART
2025
TUXTEPEC (4)
2007
JOINT VENTURE
10.0
30,000
100.0
MM CINEMA
QUERETARO
SAN JUAN DEL RIO (4)
2006
FEE
8.4
84,000
100.0
WAL-MART
QUINTANA ROO
CANCUN
2004
FEE
9.1
91,130
100.0
WAL-MART
2018
CANCUN
2007
FEE
26.7
266,816
93.0
SUBURBIA
CINEPOLIS
SAN LUIS POTOSI
SAN LUIS
2004
JOINT VENTURE
12.1
121,334
97.6
HEB
2019
SONORA
LOS MOCHIS (4)
2007
FEE
9.9
89,000
100.0
WAL-MART
TAMAULIPAS
ALTAMIRA
2007
FEE
2.4
24,479
100.0
MATAMOROS
2007
FEE
15.4
153,537
99.8
CINEPOLIS
2014
GIGANTE
2009
OFFICE DEPOT
2015
MATAMOROS
2007
FEE
1.1
10,900
100.0
MATAMOROS
2007
FEE
1.1
10,835
100.0
NUEVO LAREDO
2007
FEE
0.9
8,565
100.0
NUEVO LAREDO
2007
FEE
1.1
10,760
100.0
NUEVO LAREDO (4)
2006
FEE
11.0
110,000
100.0
WAL-MART
REYNOSA
2004
JOINT VENTURE
39.1
391,372
96.9
HEB
2029
REYNOSA
2007
FEE
11.5
115,093
100.0
GIGANTE
2012
REYNOSA
2007
FEE
1.0
9,684
100.0
REYNOSA
2007
FEE
1.5
14,741
100.0
RIO BRAVO
2007
FEE
1.0
9,673
100.0
TAMPICO
2007
FEE
1.6
16,162
100.0
VERACRUZ
MINATITLAN
2007
FEE
2.0
19,847
100.0
TOTAL 946 SHOPPING CENTER PROPERTY INTERESTS
14,862
131,695,110
US PREFERRED EQUITY INVESTMENTS (RETAIL ASSETS ONLY)
TOTAL 170 PREFERRED EQUITY INTERESTS (RETAIL ASSETS ONLY)
1,656
12,469,808
LAND HOLDINGS
ARIZONA
MESA (5)
2005
JOINT VENTURE
6.5
-
-
CHANDLER (5)
2004
JOINT VENTURE
22.9
-
-
MARANA (5)
2006
JOINT VENTURE
158.9
-
-
NORTH CAROLINA
RALEIGH (5)
2001
JOINT VENTURE
4.0
-
-
OHIO
ORANGE TOWNSHIP (5)
2001
FEE
12.2
-
-
OREGON
MCMINNVILLE (5)
2006
JOINT VENTURE
90.5
-
-
MEXICO
SINALOA
MAZALTAN (5)
2007
JOINT VENTURE
36.0
-
-
NUEVO LEON
APODACA (5)
2007
JOINT VENTURE
22.3
-
-
OTHER REAL ESTATEMENT INVESTMENTS
RETAIL STORE LEASES (14)
1995/ 1997
LEASEHOLD
-
1,766,994
97.4
AI PORTFOLIO (VARIOUS CITIES)
2005
JOINT VENTURE
175.8
7,674,988
97.7
NON-RETAIL 265 ASSETS
VARIOUS
VARIOUS
222.4
9,708,998
100.0
GRAND TOTAL 1487 PROPERTY INTERESTS
16,916.9
163,315,898 (15)
33
(1)
PERCENT LEASED INFORMATION AS OF DECEMBER 31, 2007 OR DATE OF ACQUISITION IF ACQUIRED SUBSEQUENT TO DECEMBER 31, 2007
(2)
THE TERM "JOINT VENTURE" INDICATES THAT THE COMPANY OWNS THE PROPERTY IN CONJUNCTION WITH ONE OR MORE JOINT VENTURE PARTNERS.
THE DATE INDICATED IS THE EXPIRATION DATE OF ANY GROUND LEASE AFTER GIVING AFFECT TO ALL RENEWAL PERIODS.
(3)
DENOTES REDEVELOPMENT PROJECT.
(4)
DENOTES GROUND-UP DEVELOPMENT PROJECT. THE SQUARE FOOTAGE SHOWN REPRESENTS THE COMPLETED LEASEABLE AREA.
(5)
DENOTES LAND HOLDINGS.
(6)
DENOTES PROPERTY INTEREST IN KIMPRU.
(7)
DENOTES PROPERTY INTEREST IN KIMCO INCOME REIT ("KIR").
(8)
DENOTES PROPERTY INTEREST IN KIMCO RETAIL OPPORTUNITY PORTFOLIO ("KROP").
(9)
DENOTES PROPERTY INTEREST IN KIMSOUTH REALTY, INC.
(10)
DENOTES PROPERTY INTEREST IN KIMCO INCOME FUND I.
(11)
DENOTES PROPERTY INTEREST IN PL REALTY LLC.
(12)
DENOTES PROPERTY INTEREST IN OTHER INSTITUTIONAL PROGRAMS.
(13)
DENOTES PROPERTY INTEREST IN UBS.
(14)
THE COMPANY HOLDS INTERESTS IN 19 RETAIL STORE LEASES RELATED TO THE ANCHOR STORE PREMISES IN NEIGHBORHOOD AND COMMUNITY SHOPPING CENTERS.
(15)
DOES NOT INCLUDE 30 FNC REALTY PROPERTIES COMPRISED OF 578K SQUARE FEET, 55 NEWKIRK PROPERTIES CONSISTING OF 2.8 MILLION SQUARE FEET, 401 NET LEASED
PROPERTIES WITH 2.3 MILLION SQUARE FEET AND 14.4 MILLION SQUARE FEET OF PROJECTED LEASEABLE AREA RELATED TO THE GROUND-UP DEVELOPMENT PROJECTS.
34
Executive Officers of the Registrant
The following table sets forth information with respect to the executive officers of the Company as of February 27, 2008.
Name
Age
Position
Since
Milton Cooper
78
Chairman of the Board of Directors and
1991
Chief Executive Officer
Michael J. Flynn
72
Vice Chairman of the Board of Directors and
1996
President and Chief Operating Officer
1997
David B. Henry
59
Vice Chairman of the Board of Directors and
Chief Investment Officer
2001
Thomas A. Caputo
61
Executive Vice President
2000
Glenn G. Cohen
44
Vice President -
2000
Treasurer
1997
Raymond Edwards
45
Vice President -
2001
Retail Property Solutions
Jerald Friedman
63
President, KDI and
2000
Executive Vice President
1998
Bruce M. Kauderer (1)
61
Vice President - Legal
1995
General Counsel and Secretary
1997-2007
Michael V. Pappagallo
48
Executive Vice President -
2005
Chief Financial Officer
1997
(1)
Effective January 1, 2008, Mr. Kauderer retired as Vice President - Legal, General Counsel and Secretary.
The executive officers of the Company serve in their respective capacities for approximately one-year terms and are subject to re-election by the Board of Directors, generally at the time of the Annual Meeting of the Board of Directors following the Annual Meeting of Stockholders.
35
PART II
Item 5. Market for the Registrant's Common Equity and Related Shareholder Matters
Market Information The following sets forth the common stock offerings completed by the Company during the three-year period ended December 31, 2007. The Company’s common stock was sold for cash at the following offering price per share:
Offering Date
Offering Price
March 2006
$40.80
The table below sets forth, for the quarterly periods indicated, the high and low sales prices per share reported on the NYSE Composite Tape and declared dividends per share for the Company’s common stock. The Company’s common stock is traded on the New York Stock Exchange under the trading symbol "KIM".
Stock Price
Period
High
Low
Dividends
2007:
First Quarter
$53.60
$43.59
$0.360
Second Quarter
$50.36
$36.92
$0.360
Third Quarter
$47.58
$33.74
$0.400
Fourth Quarter
$47.69
$34.74
$0.400 (a)
2006:
First Quarter
$42.00
$32.02
$0.330
Second Quarter
$40.57
$34.20
$0.330
Third Quarter
$43.15
$36.18
$0.360
Fourth Quarter
$47.13
$42.13
$0.360 (b)
(a)
Paid on January 15, 2008, to stockholders of record on January 2, 2008.
(b)
Paid on January 16, 2007, to stockholders of record on January 2, 2007.
Holders The number of holders of record of the Company's common stock, par value $0.01 per share, was 3,442 as of January 31, 2008.
Dividends Since the IPO, the Company has paid regular quarterly dividends to its stockholders. While the Company intends to continue paying regular quarterly dividends, future dividend declarations will be at the discretion of the Board of Directors and will depend on the actual cash flow of the Company, its financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code and such other factors as the Board of Directors deems relevant. The Company is required by the Internal Revenue Code of 1986, as amended, to distribute at least 90% of its REIT taxable income. The actual cash flow available to pay dividends will be affected by a number of factors, including the revenues received from rental properties, the operating expenses of the Company, the interest expense on its borrowings, the ability of lessees to meet their obligations to the Company and any unanticipated capital expenditures.
The Company has determined that the $1.48 dividend per common share paid during 2007 represented 56% ordinary income, 35% in capital gains and a 9% return of capital to its stockholders. The $1.35 dividend per common share paid during 2006 represented 66% ordinary income, 28% in capital gains and a 6% return of capital to its stockholders.
In addition to its common stock offerings, the Company has capitalized the growth in its business through the issuance of unsecured fixed and floating-rate medium-term notes, underwritten bonds, mortgage debt and construction loans, convertible preferred stock and perpetual preferred stock. Borrowings under the Company's revolving credit facilities have also been an interim source of funds to both finance the purchase of properties and other investments and meet any short-term working capital requirements. The various instruments governing the Company's issuance of its unsecured public debt, bank debt, mortgage debt and preferred stock impose certain restrictions on the Company with regard to dividends, voting, liquidation and other preferential rights available to the holders of such instruments. See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Notes 11 and 17 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.
36
The Company does not believe that the preferential rights available to the holders of its Class F Preferred Stock and Class G Preferred Stock, the financial covenants contained in its public bond indentures, as amended, or its revolving credit agreements will have an adverse impact on the Company's ability to pay dividends in the normal course to its common stockholders or to distribute amounts necessary to maintain its qualification as a REIT.
The Company maintains a dividend reinvestment and direct stock purchase plan (the "Plan") pursuant to which common and preferred stockholders and other interested investors may elect to automatically reinvest their dividends to purchase shares of the Company’s common stock or, through optional cash payments, purchase shares of the Company’s common stock. The Company may, from time-to-time, either (i) purchase shares of its common stock in the open market or (ii) issue new shares of its common stock for the purpose of fulfilling its obligations under the Plan.
Total Stockholder Return Performance The following performance chart compares, over the five years ended December 31, 2007, the cumulative total stockholder return on the Company’s common stock with the cumulative total return of the S&P 500 Index and the cumulative total return of the NAREIT Equity REIT Total Return Index (the "NAREIT Equity Index") prepared and published by the National Association of Real Estate Investment Trusts ("NAREIT"). Equity real estate investment trusts are defined as those which derive more than 75% of their income from equity investments in real estate assets. The NAREIT Equity Index includes all tax qualified equity real estate investment trusts listed on the New York Stock Exchange, American Stock Exchange or the NASDAQ National Market System. Stockholder return performance, presented quarterly for the five years ended December 31, 2007, is not necessarily indicative of future results. All stockholder return performance assumes the reinvestment of dividends.
Item 6. Selected Financial Data
The following table sets forth selected, historical, consolidated financial data for the Company and should be read in conjunction with the Consolidated Financial Statements of the Company and Notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in this annual report on Form 10-K.
The Company believes that the book value of its real estate assets, which reflects the historical costs of such real estate assets less accumulated depreciation, is not indicative of the current market value of its properties. Historical operating results are not necessarily indicative of future operating performance.
37
Year ended December 31, (2)
2007
2006
2005
2004
2003
(in thousands, except per share information)
Operating Data:
Revenues from rental property (1)
$
681,553
$
587,547
$
501,569
$
488,021
$
446,096
Interest expense (3)
$
213,674
$
170,677
$
126,432
$
105,898
$
101,351
Depreciation and amortization (3)
$
189,650
$
139,263
$
100,517
$
94,651
$
78,817
Gain on sale of development properties (4)
$
40,099
$
37,276
$
33,636
$
16,835
$
17,495
Gain on transfer/sale of operating properties, net (3)
$
2,708
$
2,460
$
2,833
$
-
$
3,177
Benefit for income taxes (5)
$
30,346
$
-
$
-
$
-
$
-
Provision for income taxes (6)
$
-
$
17,253
$
10,989
$
8,320
$
8,514
Income from continuing operations (7)
$
361,934
$
345,309
$
324,894
$
273,393
$
234,195
Income per common share, from continuing
operations:
Basic
$
1.36
$
1.39
$
1.38
$
1.17
$
0.99
Diluted
$
1.33
$
1.36
$
1.36
$
1.15
$
0.97
Weighted average number of shares of common
stock:
Basic
252,129
239,552
226,641
222,859
214,184
Diluted
257,058
244,615
230,868
227,143
217,540
Cash dividends declared per common share
$
1.52
$
1.38
$
$1.27
$
1.16
$
1.10
December 31,
2007
2006
2005
2004
2003
Balance Sheet Data:
$
7,325,035
$
6,001,319
$
4,560,406
$
4,092,222
$
4,174,664
Real estate, before accumulated depreciation
$
9,097,816
$
7,869,280
$
5,534,636
$
4,749,597
$
4,641,092
Total assets
$
4,216,415
$
3,587,243
$
2,691,196
$
2,118,622
$
2,154,948
Total debt
$
3,894,574
$
3,366,959
$
2,387,214
$
2,236,400
$
2,135,846
Total stockholders' equity
Cash flow provided by operations
$
665,989
$
455,569
$
410,797
$
365,176
$
308,632
Cash flow used for investing activities
$
(1,507,611)
$
(246,221)
$
(716,015)
$
(299,597)
$
(637,636)
Cash flow provided by (used for) financing activities
$
$584,056
$
59,444
$
343,271
$
(75,647)
$
341,330
(1)
Does not include (i) revenues from rental property relating to unconsolidated joint ventures, (ii) revenues relating to the investment in retail stores leases and (iii) revenues from properties included in discontinued operations.
(2)
All years have been adjusted to reflect the impact of operating properties sold during the years ended December 31, 2007, 2006, 2005, 2004 and 2003 and properties classified as held for sale as of December 31, 2007, which are reflected in discontinued operations in the Consolidated Statements of Income.
(3)
Does not include amounts reflected in discontinued operations.
(4)
Amounts exclude income taxes
(5)
Does not include amounts reflected in discontinued operations and extraordinary gain. Amounts include income taxes related to gain on sale of development properties, gain on transfer/sale of operating properties, and adjustment for property carrying value.
(6)
Amounts include income taxes related to gain on sale of development properties and gain on transfer/sale of operating properties.
(7)
Amounts include gain on transfer/sale of operating properties, net of tax.
38
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in this annual report on Form 10-K. Historical results and percentage relationships set forth in the Consolidated Statements of Income contained in the Consolidated Financial Statements, including trends which might appear, should not be taken as indicative of future operations.
Executive Summary
Kimco Realty Corporation is one of the nation’s largest publicly-traded owners and operators of neighborhood and community shopping centers. As of December 31, 2007, the Company had interests in 1,973 properties totaling approximately 183 million square feet of GLA located in 45 states, Canada, Mexico, Puerto Rico and Chile.
The Company is self-administered and self-managed through present management, which has owned and managed neighborhood and community shopping centers for over 45 years. The executive officers are engaged in the day-to-day management and operation of real estate exclusively with the Company, with nearly all operating functions, including leasing, asset management, maintenance, construction, legal, finance and accounting, administered by the Company.
In connection with the Tax Relief Extension Act of 1999 (the "RMA"), which became effective January 1, 2001, the Company is permitted to participate in activities which it was precluded from previously in order to maintain its qualification as a Real Estate Investment Trust ("REIT"), so long as these activities are conducted in entities which elect to be treated as taxable subsidiaries under the Code, subject to certain limitations. As such, the Company, through its taxable REIT subsidiaries, is engaged in various retail real estate-related opportunities including (i) merchant building, through its wholly owned taxable REIT subsidiaries, which are primarily engaged in the ground-up development of neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) retail real estate advisory and disposition services, which primarily focus on leasing and disposition strategies of retail real estate controlled by both healthy and distressed and/or bankrupt retailers and (iii) acting as an agent or principal in connection with tax deferred exchange transactions. The Company will consider other investments through taxable REIT subsidiaries should suitable opportunities arise.
In addition, the Company continues to capitalize on its established expertise in retail real estate by establishing other ventures in which the Company owns a smaller equity interest and provides management, leasing and operational support for those properties. The Company also provides preferred equity capital for real estate entrepreneurs and provides real estate capital and advisory services to both healthy and distressed retailers. The Company also makes selective investments in secondary market opportunities where a security or other investment is, in management’s judgment, priced below the value of the underlying real estate.
The Company’s strategy is to maintain a strong balance sheet while investing opportunistically and selectively. The Company intends to continue to execute its plan of delivering solid growth in earnings and dividends. As a result of the improved 2007 performance, the Board of Directors increased the quarterly dividend per common share to $0.40 from $0.36, effective for the third quarter of 2007.
Critical Accounting Policies
The Consolidated Financial Statements of the Company include the accounts of the Company, its wholly-owned subsidiaries and all entities in which the Company has a controlling interest including where the Company has been determined to be a primary beneficiary of a variable interest entity in accordance with the provisions and guidance of Interpretation No. 46 (R), Consolidation of Variable Interest Entities, or meets certain criteria of a sole general partner or managing member in accordance with Emerging Issues Task Force ("EITF") Issue 04-5, Investor’s Accounting for an Investment in a Limited Partnership when the Investor is the Sole General Partner and the Limited Partners have Certain Rights ("EITF 04-5"). The Company applies these provisions to each of its joint venture investments to determine whether the cost, equity or consolidation method of accounting is appropriate. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions in certain circumstances that affect amounts reported in the accompanying Consolidated Financial Statements and related notes. In preparing these financial
39
statements, management has made its best estimates and assumptions that affect the reported amounts of assets and liabilities. These estimates are based on, but not limited to, historical results, industry standards and current economic conditions, giving due consideration to materiality. The most significant assumptions and estimates relate to revenue recognition and the recoverability of trade accounts receivable, depreciable lives, valuation of real estate, joint venture investments and realizability of deferred tax assets. Application of these assumptions requires the exercise of judgment as to future uncertainties, and, as a result, actual results could materially differ from these estimates.
Revenue Recognition and Accounts Receivable
Base rental revenues from rental property are recognized on a straight-line basis over the terms of the related leases. Certain of these leases also provide for percentage rents based upon the level of sales achieved by the lessee. These percentage rents are recorded once the required sales level is achieved. Operating expense reimbursements are recognized as earned. Rental income may also include payments received in connection with lease termination agreements. In addition, leases typically provide for reimbursement to the Company of common area maintenance, real estate taxes and other operating expenses.
The Company makes estimates of the uncollectability of its accounts receivable related to base rents, expense reimbursements and other revenues. The Company analyzes accounts receivable and historical bad debt levels, customer credit-worthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. In addition, tenants in bankruptcy are analyzed and estimates are made in connection with the expected recovery of pre-petition and post-petition claims. The Company’s reported net income is directly affected by management’s estimate of the collectability of accounts receivable.
Real Estate
The Company’s investments in real estate properties are stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to operations as incurred. Significant renovations and replacements, which improve and extend the life of the asset, are capitalized.
Upon acquisition of operating real estate properties, the Company estimates the fair value of acquired tangible assets (primarily consisting of land, building, building improvements and tenant improvements) and identified intangible assets and liabilities (primarily consisting of above and below-market leases, in-place leases and tenant relationships), assumed debt and redeemable units issued in accordance with Statement of Financial Accounting Standards ("SFAS") No. 141, Business Combinations. Based on these estimates, the Company allocates the purchase price to the applicable assets and liabilities. The Company utilizes methods similar to those used by independent appraisers in estimating the fair value of acquired assets and liabilities. The useful lives of amortizable intangible assets are evaluated each reporting period with any changes in estimated useful lives being accounted for over the revised remaining useful life.
Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets, as follows:
Buildings and building improvements
15 to 50 years
Fixtures, leasehold and tenant improvements
Terms of leases or useful lives, whichever is shorter
(including certain identified intangible assets)
The Company is required to make subjective assessments as to the useful lives of its properties for purposes of determining the amount of depreciation to reflect on an annual basis with respect to those properties. These assessments have a direct impact on the Company’s net income.
Real estate under development on the Company’s Consolidated Balance Sheets represents ground-up development of neighborhood and community shopping center projects which are subsequently sold upon completion and projects which the Company may hold as long-term investments. These assets are carried at cost. The cost of land and buildings under development includes specifically identifiable costs. The capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, salaries and related costs of personnel directly involved and other costs incurred during the period of development. The Company ceases cost capitalization when the property is held available for occupancy upon substantial completion of tenant improvements, but no later than one year from the
40
completion of major construction activity. If, in management’s opinion, the estimated net sales price of these assets is less than the net carrying value, an adjustment to the carrying value would be recorded to reflect the estimated fair value of the property. A gain on the sale of these assets is generally recognized using the full accrual method in accordance with the provisions of SFAS No. 66, Accounting for Real Estate Sales.
Investments in Unconsolidated Joint Ventures
The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting as the Company exercises significant influence, but does not control, these entities. These investments are recorded initially at cost and subsequently adjusted for cash contributions and distributions. Earnings for each investment are recognized in accordance with each respective investment agreement and where applicable, based upon an allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period.
The Company’s joint ventures and other real estate investments primarily consist of co-investments with institutional and other joint venture partners in neighborhood and community shopping center properties, consistent with its core business. These joint ventures typically obtain non-recourse third-party financing on their property investments, thus contractually limiting the Company’s exposure to losses to the amount of its equity investment, and due to the lender’s exposure to losses, a lender typically will require a minimum level of equity in order to mitigate its risk. The Company’s exposure to losses associated with its unconsolidated joint ventures is primarily limited to its carrying value in these investments.
On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment’s value is impaired only if management’s estimate of the fair value of the investment is less than the carrying value of the investment and such difference is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the estimated fair value of the investment.
Long Lived Assets
On a periodic basis, management assesses whether there are any indicators that the value of the real estate properties (including any related amortizable intangible assets or liabilities) may be impaired. A property value is considered impaired only if management’s estimate of current and projected operating cash flows (undiscounted and without interest charges) of the property over its remaining useful life is less than the net carrying value of the property. Such cash flow projections consider factors such as expected future operating income, trends, and prospects, as well as the effects of demand, competition and other factors. To the extent impairment has occurred, the carrying value of the property would be adjusted to an amount to reflect the estimated fair value of the property.
When a real estate asset is identified by management as held for sale, the Company ceases depreciation of the asset and estimates the sales price of such asset net of selling costs. If, in management’s opinion, the net sales price of the asset is less than the net book value of such asset, an adjustment to the carrying value would be recorded to reflect the estimated fair value of the property.
The Company is required to make subjective assessments as to whether there are impairments in the value of its real estate properties, investments in joint ventures and other investments. The Company’s reported net income is directly affected by management’s estimate of impairments and/or valuation allowances.
Results of Operations
Comparison 2007 to 2006
2007
2006
Increase/ (Decrease)
% change
(all amounts in thousands)
Revenues from rental property (1)
$ 681.6
$ 587.5
$ 94.1
16.0%
Rental property expenses: (2)
Rent
$ 12.1
$ 11.5
$ 0.6
5.2%
Real estate taxes
83.6
74.6
9.0
12.1%
Operating and maintenance
90.0
72.7
17.3
23.8%
$ 185.7
$ 158.8
$ 26.9
16.9%
Depreciation and amortization (3)
$ 189.7
$ 139.3
$ 50.4
36.2%
41
(1)
Revenues from rental property increased primarily from the combined effect of (i) the acquisition of operating properties during 2006 and 2007, providing incremental revenues of approximately $85.5 million, (ii) an overall occupancy increase from the consolidated shopping center portfolio to 95.9% at December 31, 2007, as compared to 95.1% at December 31, 2006, due to growth in rental rates from renewing expiring leases, the completion of certain redevelopment and development projects and tenant buyouts providing incremental revenues of approximately $14.6 million for the year ended December 31, 2007 as compared to the corresponding period in 2006, offset by (iii) a decrease in revenues of approximately $6.0 million for the year ended December 31, 2007 as compared to the corresponding period in 2006, resulting from the transfer of operating properties to various unconsolidated joint venture entities, and the sale of certain properties during 2007 and 2006.
(2)
Rental property expenses increased primarily due to operating property acquisitions during 2007 and 2006 which were partially offset by operating property dispositions including those transferred to various joint venture entities.
(3)
Depreciation and amortization increased primarily due to operating property acquisitions during 2007 and 2006 which were partially offset by operating property dispositions including those transferred to various joint venture entities.
Mortgage and other financing income decreased $4.6 million to $14.2 million for the year ended December 31, 2007, as compared to $18.8 million for the corresponding period in 2006. This decrease is primarily due to the recognition of accretion income of approximately $6.2 million, resulting from the early prepayment of a mortgage receivable in 2006 partially offset by an overall increase in interest income on mortgage receivables entered into in 2007 and 2006.
Management and other fee income increased approximately $14.2 million for the year ended December 31, 2007, as compared to the corresponding period in 2006. This increase is primarily due to increased property management fees and other transaction related fees related to the growth in the Company’s co-investment programs.
General and administrative expenses increased approximately $26.6 million for the year ended December 31, 2007, as compared to the corresponding period in 2006. This increase is primarily due to personnel-related costs, primarily due to growth within the Company’s co-investment programs and the overall continued growth of the Company.
Interest, dividends and other investment income decreased approximately $24.9 million for the year ended December 31, 2007, as compared to the corresponding period in 2006. This decrease is primarily due to a decrease in realized gains resulting from the sale of certain marketable securities during 2007 as compared to the corresponding period in 2006.
Other (expense)/income, net decreased approximately $19.5 million to $10.6 million of an expense for the year ended December 31, 2007, as compared to $8.9 million in income for the corresponding period in 2006. This decrease is primarily due to (i) the receipt of fewer shares during 2007 as compared to 2006 of Sears Holding Corp. common stock received as partial settlement of Kmart pre-petition claims and (ii) an increase in Canadian withholding charges on profit participation proceeds received during 2007 relating to capital transactions from a Canadian preferred equity investment.
Interest expense increased approximately $43.0 million for the year ended December 31, 2007, as compared to the corresponding period in 2006. This increase is due to higher interest rates and higher outstanding levels of debt during the year ended December 31, 2007, as compared to the same period in 2006.
Benefit for income taxes increased $48.9 million for the year ended December 31, 2007, as compared to the corresponding period in 2006. This increase is primarily due to the reduction of approximately $31.2 million of NOL valuation allowance and a tax benefit of approximately $10.1 million from operating losses recognized in connection with the Albertson’s investment.
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Equity in income of real estate joint ventures, net increased $67.8 million to $173.4 million for the year ended December 31, 2007, as compared to $105.5 million for the corresponding period in 2006. This increase is primarily the result of (i) an increase in equity in income from the Kimco Realty Opportunity Portfolio ("KROP") joint venture investment primarily resulting from profit participation of approximately $39.3 million and gains on sale/transfer of operating properties during 2007 of which the Company’s share of gains were $12.8 million for the year ended December 31, 2007, (ii) an increase in equity in income from the Kimco Income Opportunity Portfolio ("KIR") joint venture investment primarily resulting from gains on sale of operating properties during 2007 of which the Company’s share of gains was $20.7 million for the year ended December 31, 2007 and (iii) the Company’s growth of its various other real estate joint ventures due to additional capital investments for the acquisition of additional operating properties by the ventures throughout 2007 and 2006, partially offset by net operating losses and excess cash distribution from the Albertson’s joint venture of approximately $7.9 million during 2007.
During 2007, the Company sold, in separate transactions, (i) four recently completed merchant building projects, (ii) 26 out-parcels, (iii) 74.3 acres of undeveloped land and (iv) completed partial sales of two projects, for aggregate total proceeds of approximately $310.5 million and approximately $3.3 million of proceeds from completed earn-out requirements on previously sold projects. These transactions resulted in gains of approximately $24.1 million, after income taxes of $16.0 million.
As part of the Company’s ongoing analysis of its merchant building projects, the Company has determined that for two of its projects, located in Jacksonville, FL and Anchorage, AK, the recoverable value will not exceed their estimated cost. This is primarily due to adverse changes in local market conditions and the uncertainty of those conditions in the future. As a result, the Company has recorded an aggregate pre-tax adjustment of property carrying value on these projects for the year ended December 31, 2007, of $8.5 million, representing the excess of the carrying value of the projects over their estimated fair value.
During 2006, the Company sold six recently completed merchant building projects, its partnership interest in one project and 30 out-parcels, in separate transactions, for approximately $260.0 million. These sales resulted in gains of approximately $25.1 million, after income taxes of $12.2 million. These gains exclude approximately $1.1 million of gain relating to one project, which was deferred due to the Company’s continued ownership interest.
During 2007, the Company (i) disposed of six operating properties and completed partial sales of three operating properties, in separate transactions, for an aggregate sales price of approximately $40.0 million, which resulted in an aggregate net gain of approximately $6.4 million, after income tax of approximately $1.6 million and (ii) transferred one operating property, which was acquired in the first quarter of 2007, to a joint venture in which the Company holds a 15% non-controlling ownership interest for an aggregate price of approximately $4.5 million, which represented the net book value.
Additionally, during 2007, two consolidated joint ventures in which the Company had preferred equity investments disposed of, in separate transactions, their respective properties for an aggregate sales price of approximately $66.5 million. As a result of these capital transactions, the Company received approximately $22.1 million of profit participation, before minority interest of approximately $5.6 million. This profit participation has been recorded as income from other real estate investments and is reflected in Income from discontinued operating properties in the Company’s Consolidated Statements of Income.
During 2006, the Company disposed of (i) 28 operating properties and one ground lease for an aggregate sales price of $270.5 million, which resulted in an aggregate net gain of approximately $71.7 million, net of income taxes of $2.8 million relating to the sale of two properties, and (ii) transferred five operating properties, to joint ventures in which the Company has 20% non-controlling interests for an aggregate price of approximately $95.4 million, which resulted in a gain of approximately $1.4 million from one transferred property.
Net income for the year ended December 31, 2007 was $442.8 million or $1.65 on a diluted per share basis as compared to $428.3 million or $1.70 on a diluted per share basis for the corresponding period in 2006. This change is primarily attributable to (i) an increase in revenues from rental properties primarily due to acquisitions of operating properties during 2007 and 2006, (ii) an increase in equity in income of real estate joint ventures achieved from profit participation and gains on sale of joint venture operating properties and additional capital investments in the Company’s joint venture programs for the acquisition of additional operating properties throughout 2007 and 2006,
43
(iii) earnings of $75.5 million related to the Albertson’s investment monetization, partially offset by, (iv) a decrease in income resulting from the sale of certain marketable securities during the corresponding period in 2006 and (v) a decrease in gains on sale of operating properties in 2007 as compared to 2006.
Comparison 2006 to 2005
2006
2005
Increase/ (Decrease)
% change
(amounts in thousands)
Revenues from rental property (1)
$ 587.5
$ 501.6
$ 85.9
17.1%
Rental property expenses: (2)
Rent
$ 11.5
$ 10.0
$ 1.5
15.0%
Real estate taxes
74.6
64.1
10.5
16.4%
Operating and maintenance
72.7
58.2
14.5
24.9%
$ 158.8
$ 132.3
$ 26.5
20.0%
Depreciation and amortization (3)
$ 139.3
$ 100.5
$ 38.8
38.6%
(1)
Revenues from rental property increased primarily from the combined effect of (i) the acquisition of operating properties during 2006 and 2005, providing incremental revenues for the year ended December 31, 2006 of approximately $72.3 million, (ii) an overall increase in shopping center portfolio occupancy to 95.1% at December 31, 2006, as compared to 94.6% at December 31, 2005 and the completion of certain redevelopment and development projects providing incremental revenues of approximately $33.6 million for the year ended December 31, 2006 as compared to the corresponding period in 2005, offset by (iii) a decrease in revenues of approximately $20.0 million for the year ended December 31, 2006, as compared to the corresponding period in 2005, resulting from the transfer of operating properties to various unconsolidated joint venture entities, tenant buyouts, and the sale of certain properties during 2005 and 2006.
(2)
Rental property expenses increased primarily due to operating property acquisitions during 2006 and 2005 which were partially offset by operating property dispositions including those transferred to various joint venture entities.
(3)
Depreciation and amortization increased primarily due to operating property acquisitions during 2006 and 2005 which were partially offset by operating property dispositions including those transferred to various joint venture entities.
Mortgage and other financing income decreased $8.8 million to $18.8 million for the year ended December 31, 2006, as compared to $27.6 million for the corresponding period in 2005. This decrease is primarily due to the recognition in 2005 of a prepayment fee of $14.0 million received by the Company relating to the early repayment by Shopko of its outstanding loan with the Company, offset by accretion income of approximately $6.2 million received in 2006, resulting from an early prepayment of a mortgage receivable in June 2006, which had been acquired at a discount.
Management and other fee income increased approximately $10.2 million for the year ended December 31, 2006, as compared to the corresponding period in 2005. This increase is primarily due to incremental fees earned from the Kimsouth portfolio and growth in the Company’s other co-investment programs.
General and administrative expenses increased approximately $20.8 million for the year ended December 31, 2006, as compared to the corresponding period in 2005. This increase is primarily due to personnel-related costs including the non-cash expensing of stock options granted and the overall continued growth of the Company.
Interest, dividends and other investment income increased approximately $27.5 million for the year ended December 31, 2006, as compared to the corresponding period in 2005. This increase is primarily due to greater realized gains on the sale of certain marketable securities and increased interest and dividend income as a result of higher cash balances and the growth in the marketable securities portfolio during 2006 as compared to 2005.
Interest expense increased $44.2 million for the year ended December 31, 2006, as compared to the corresponding period in 2005. This increase is due to higher interest rates and higher outstanding levels of debt during this period as compared to the same period in the preceding year.
44
Income from other real estate investments increased $20.3 million to $77.1 million for the year ended December 31, 2006, as compared to $56.8 million for the corresponding period in 2005. This increase is primarily due to (i) increased investment in the Company’s Preferred Equity program which contributed $40.1 million for the year ended December 31, 2006, including $12.2 million of profit participation earned from 16 capital transactions, as compared to $32.8 million for the corresponding period in 2005, including $12.6 million of profit participation earned from six capital transactions and (ii) pre-tax profits of $7.9 million from the transfer of two properties from Kimsouth to a joint venture in which the Company has an 18% non-controlling interest. These profits exclude amounts that have been deferred as a result of the Company’s continued ownership interest.
Equity in income of real estate joint ventures, net increased $28.1 million to $105.5 million for the year ended December 31, 2006, as compared to $77.5 million for the corresponding period in 2005. This increase is primarily attributable to (i) increase in equity in income from the KROP joint venture primarily resulting from profit participation of approximately $22.2 million and gains from the sale of nine operating properties, one land parcel and one out-parcel during 2006 of which the Company’s share of gains was $9.9 million for the year ended December 31, 2006, and (ii) the Company’s growth of its various other real estate joint ventures. The Company has made additional capital investments in these and other joint ventures for the acquisition of additional shopping center properties by the ventures throughout 2006 and 2005.
During 2006, the Company sold six recently completed merchant building projects, its partnership interest in one project and 30 out-parcels, in separate transactions, for approximately $260.0 million. These sales resulted in gains of approximately $25.1 million, after income taxes of $12.2 million. These gains exclude approximately $1.1 million of gain relating to one project, which was deferred due to the Company’s continued ownership interest.
During 2005, the Company sold, in separate transactions, 41 out-parcels and six recently completed merchant building projects for approximately $264.1 million. These sales provided gains of approximately $22.8 million, after income taxes of approximately $10.8 million.
During 2006, the Company disposed of (i) 28 operating properties and one ground lease for an aggregate sales price of $270.5 million, which resulted in an aggregate net gain of approximately $71.7 million, net of income taxes of $2.8 million relating to the sale of two properties, and (ii) transferred five operating properties, to joint ventures in which the Company has 20% non-controlling interests for an aggregate price of approximately $95.4 million, which resulted in a gain of approximately $1.4 million from one transferred property.
During 2005, the Company disposed of, in separate transactions, (i) 20 operating properties for an aggregate sales price of approximately $93.3 million, (ii) transferred three operating properties to KROP for an aggregate price of approximately $49.0 million and (iii) transferred 52 operating properties to various joint ventures in which the Company has non-controlling interests ranging from 15% to 50% for an aggregate price of approximately $183.1 million. For the year ended December 31, 2005, these transactions resulted in gains of approximately $31.9 million and a loss on sale/transfer from four of the properties for $5.2 million.
Net income for the year ended December 31, 2006 was $428.3 million. Net income for the year ended December 31, 2005 was $363.6 million. On a diluted per share basis, net income improved $0.18 to $1.70 for the year ended December 31, 2006, as compared to $1.52 for the corresponding period in 2005. These increases are attributable to (i) an increase in revenues from rental properties primarily due to acquisitions in 2006 and 2005, (ii) increased income from other real estate investments primarily due to increased investments in the Company’s Preferred Equity program, (iii) an increase in equity in income of real estate joint ventures achieved from profit participation and gains on sale of joint venture operating properties and additional capital investment in the Company’s joint venture programs for the acquisition of additional operating properties throughout 2006 and 2005, (iv) increased gains on sales of operating properties in 2006 and (v) increased income contributed from the marketable securities portfolio in 2006 as compared to 2005, partially offset by, (vi) an increase in interest expense due to higher interest rates and increased borrowings during 2006.
45
Tenant Concentrations
The Company seeks to reduce its operating and leasing risks through diversification achieved by the geographic distribution of its properties, avoiding dependence on any single property, and a large tenant base. At December 31, 2007, the Company’s five largest tenants were The Home Depot, TJX Companies, Sears Holdings, Kohl’s and Wal-Mart, which represented approximately 3.2%, 2.8%, 2.3%, 2.0% and 1.9%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
Liquidity and Capital Resources
The Company’s capital resources include access to liquidity in the capital markets, mortgage and construction loan financing and immediate access to unsecured revolving credit facilities with aggregate bank commitments of approximately $1.8 billion.
The Company’s cash flow activities are summarized as follows (in millions):
Year Ended December 31,
2007
2006
2005
Net cash flow provided by operating activities
$ 666.0
$ 455.6
$ 410.8
Net cash flow used for investing activities
$ (1,507.6)
$ (246.2)
$ (716.0)
Net cash flow provided by financing activities
$ 584.1
$ 59.4
$ 343.3
Operating Activities
Cash flows provided from operating activities for the year ended December 31, 2007 were approximately $666.0 million, as compared to approximately $455.6 million for the comparable period in 2006. The increase of approximately $210.4 million is primarily attributable to increased cash flows due to (i) the acquisition of properties during 2007 and 2006, (ii) an increase in revenues from rental properties due to an overall occupancy increase from the consolidated shopping center portfolio, growth in rental rates from lease renewals and the completion of certain re-development and development projects and (iii) an increase in distributions from joint ventures primarily received from the Company’s investment in KROP resulting from the distribution of profit participation proceeds and distributions from the Albertson's investment.
The Company anticipates that cash flows from operating activities will continue to provide adequate capital to fund its operating and administrative expenses, regular debt service obligations and all dividend payments in accordance with REIT requirements in both the short term and long term. In addition, the Company anticipates that cash on hand, borrowings under its revolving credit facilities, issuance of equity and public debt, as well as other debt and equity alternatives, will provide the necessary capital required by the Company. Net cash flow provided by operating activities for the year ended December 31, 2007, was primarily attributable to (i) cash flow from the diverse portfolio of rental properties, (ii) the acquisition of operating properties during 2007 and 2006, (iii) new leasing, expansion and re-tenanting of core portfolio properties and (iv) growth in the Company’s joint venture and Preferred Equity programs.
Investing Activities
Cash flows used for investing activities for the year ended December 31, 2007 were approximately $1.5 billion, as compared to approximately $246.2 million for the comparable period in 2006. This increase in cash utilization of $1.3 billion resulted primarily from an increase in acquisition of and improvements to operating real estate and real estate under development and a decrease in proceeds received from transferred operating/development properties, partially offset by reimbursements of advances to real estate joint ventures received in 2007 as compared to 2006.
Acquisitions and Redevelopments
During the year ended December 31, 2007, the Company expended approximately $1.0 billion towards acquisition of and improvements to operating real estate. (See Note 3 of the Notes to the Consolidated Financial Statements included in this annual report on Form 10-K.)
46
The Company has an ongoing program to reformat and re-tenant its properties to maintain or enhance its competitive position in the marketplace. During the year ended December 31, 2007, the Company expended approximately $70.1 million in connection with these major redevelopments and re-tenanting projects. The Company anticipates its capital commitment toward these and other redevelopment projects during 2008 will be approximately $90.0 million to $110.0 million. The funding of these capital requirements will be provided by cash flow from operating activities and availability under the Company’s revolving lines of credit.
Investments and Advances to Real Estate Joint Ventures
During the year ended December 31, 2007, the Company expended approximately $413.2 million for investments and advances to real estate joint ventures and received approximately $293.5 million from reimbursements of advances to real estate joint ventures. (See Note 7 of the Notes to the Consolidated Financial Statements included in this annual report on Form 10-K.)
Ground-up Development
The Company is engaged in ground-up development projects which consist of (i) merchant building through the Company’s wholly-owned taxable REIT subsidiaries, which develop neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) U.S. ground-up development projects which will be held as long-term investments by the Company and (iii) various ground-up development projects located in Mexico for long-term investment (see Recent Developments - International Real Estate Investments and Note 3 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K). The ground-up development projects generally have significant pre-leasing prior to the commencement of construction. As of December 31, 2007, the Company had in progress a total of 60 ground-up development projects including 27 merchant building projects, nine U.S. ground-up development projects, and 24 ground-up development projects located throughout Mexico.
During the year ended December 31, 2007, the Company expended approximately $640.9 million in connection with the purchase of land and construction costs related to these projects and those sold during 2007. The Company anticipates its capital commitment during 2008 toward these and other development projects will be approximately $200.0 million to $250.0 million. The proceeds from the sales of completed ground-up development projects, proceeds from construction loans and availability under the Company’s revolving lines of credit are expected to be sufficient to fund these anticipated capital requirements.
Dispositions and Transfers
During the year ended December 31, 2007, the Company received net proceeds of approximately $359.2 million relating to the sale of various operating properties and ground-up development projects and approximately $69.9 million from the transfer of operating properties to various joint ventures. (See Notes 3 and 7 of the Notes to the Consolidated Financial Statements included in this annual report on Form 10-K.)
Financing Activities
Cash flows provided from financing activities for the year ended December 31, 2007 were approximately $584.1 million, as compared to approximately $59.4 million for the comparable period in 2006. This increase of approximately $524.7 million resulted primarily from (i) an increase in borrowings under the Company’s revolving credit facilities in 2007 due to increased investment activity during 2007, (ii) an increase in proceeds from mortgage/construction loan financing and (iii) a decrease in the repayment of borrowings under the revolving credit facilities in 2007 as compared to 2006, partially offset by an increase in dividends paid.
It is management’s intention that the Company continually has access to the capital resources necessary to expand and develop its business. As such, the Company intends to operate with and maintain a conservative capital structure with a level of debt to total market capitalization of 50% or less. As of December 31, 2007, the Company’s level of debt to total market capitalization was 30%. In addition, the Company intends to maintain strong debt service coverage and fixed charge coverage ratios as part of its commitment to maintaining its investment-grade debt ratings. The Company may, from time-to-time, seek to obtain funds through additional common and preferred equity offerings, unsecured debt financings and/or mortgage/construction loan financings and other capital alternatives in a manner consistent with its intention to operate with a conservative debt structure.
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Since the completion of the Company’s IPO in 1991, the Company has utilized the public debt and equity markets as its principal source of capital for its expansion needs. Since the IPO, the Company has completed additional offerings of its public unsecured debt and equity, raising in the aggregate over $5.7 billion. Proceeds from public capital market activities have been used for the purposes of, among other things, repaying indebtedness, acquiring interests in neighborhood and community shopping centers, funding ground-up development projects, expanding and improving properties in the portfolio and other investments. In March 2006, the Company was added to the S & P 500 Index, an index containing the stock of 500 Large Cap corporations, most of which are U.S. corporations.
During October 2007, the Company established a new $1.5 billion unsecured U.S. revolving credit facility (the "U.S. Credit Facility") with a group of banks, which is scheduled to expire in October 2011. This credit facility, which replaced the Company’s $850.0 million unsecured U.S. revolving facility, which was scheduled to expire in July 2008, has made available funds to finance general corporate purposes, including (i) property acquisitions, (ii) investments in the Company’s institutional management programs, (iii) development and redevelopment costs and (iv) any short-term working capital requirements. Interest on borrowings under the U.S. Credit Facility accrues at LIBOR plus 0.375% and fluctuates in accordance with changes in the Company’s senior debt ratings. As part of this U.S. Credit Facility, the Company has a competitive bid option whereby the Company may auction up to $750.0 million of its requested borrowings to the bank group. This competitive bid option provides the Company the opportunity to obtain pricing below the currently stated spread. A facility fee of 0.125% per annum is payable quarterly in arrears. As part of the U.S. Credit Facility, the Company has a $200.0 million sub-limit which provides it the opportunity to borrow in alternative currencies such as Pounds Sterling, Japanese Yen or Euros. Pursuant to the terms of the U.S. Credit Facility, the Company, among other things, is subject to covenants requiring the maintenance of (i) maximum leverage ratios on both secured and unsecured debt and (ii) minimum interest and fixed coverage ratios. As of December 31, 2007, there was approximately $259.0 million outstanding under this credit facility, of which approximately $9.0 million (approximately 4.5 million Pounds Sterling) was outstanding under the alternative currency sub-limit.
The Company also has a three-year CAD $250.0 million unsecured credit facility with a group of banks. This facility bore interest at the CDOR Rate, as defined, plus 0.45%, and was scheduled to expire in March 2008. During October 2007, the facility was amended to modify the covenant package to conform to the Company’s U.S. Credit Facility. The facility was further amended in January 2008, to extend the maturity date to 2011, with an additional one-year extension option, at a reduced rate of CDOR plus 0.375%, subject to change in accordance with the Company’s senior debt ratings. Proceeds from this facility are used for general corporate purposes, including the funding of Canadian denominated investments. As of December 31, 2007, there was no outstanding balance under this credit facility.
Additionally, the Company has a three-year MXP 500.0 million unsecured revolving credit facility. This facility bears interest at the TIIE Rate, as defined therein, plus 1.00%, subject to change in accordance with the Company’s senior debt ratings, and is scheduled to mature in May 2008 with an additional one-year extension option. Proceeds from this facility are used to fund peso denominated investments. As of December 31, 2007, there was MXP 250.0 million (approximately USD $22.9 million) outstanding under this credit facility.
The Company is currently negotiating a five-year fixed rate MXP 1.0 billion term loan. Proceeds from this loan will be used to pay the outstanding balance on the MXP 500.0 million unsecured revolving credit facility and for funding Mexican denominated investments.
During August 2007, the Company obtained a $200.0 million unsecured term loan that bore interest at LIBOR plus 0.325%. The term loan was scheduled to mature on December 14, 2007. The Company utilized these proceeds to partially repay the outstanding balance on the Company’s U.S. Credit Facility. The term loan was fully repaid in October 2007.
The Company has a Medium Term Notes ("MTN") program pursuant to which it may, from time-to-time, offer for sale its senior unsecured debt for any general corporate purposes, including (i) funding specific liquidity requirements in its business, including property acquisitions, development and redevelopment costs and (ii) managing the Company’s debt maturities. (See Note 11 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
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During April 2007, the Company issued $300.0 million of ten-year Senior Unsecured Notes at an interest rate of 5.70% per annum payable semi-annually in arrears. These notes were sold at 99.984% of par value. Net proceeds from the issuance were approximately $297.8 million, after related transaction costs of approximately $2.2 million. The proceeds from this issuance were primarily used to repay a portion of the outstanding balance under the Company’s U.S. Credit Facility and for general corporate purposes. These notes were issued in conjunction with a fourth supplemental indenture, which removed the financial covenant requirements for this issuance and future offerings under the indenture as amended.
During the year ended December 31, 2007, the Company repaid the following senior unsecured notes: (i) its $30.0 million 7.46% fixed rate notes, which matured on May 20, 2007, (ii) its $55.0 million 5.75% fixed rate notes, which matured on June 29, 2007, (iii) its $20.0 million 6.96% fixed rate notes which matured on July 16, 2007, (iv) its $50.0 million 7.86% fixed rate notes, which matured on November 1, 2007, (v) its $50.0 million 7.90% fixed rate notes, which matured on December 7, 2007 and (vi) its $10.0 million 6.70% fixed rate notes, which matured on December 14, 2007. Additionally, the Company repaid its $35.0 million 4.96% fixed rate Senior Unsecured Notes, which matured on November 30, 2007.
In addition to the public equity and debt markets as capital sources, the Company may, from time-to-time, obtain mortgage financing on selected properties and construction loans to partially fund the capital needs of its ground-up development projects. As of December 31, 2007, the Company had over 390 unencumbered property interests in its portfolio.
During 2007, the Company (i) obtained an aggregate of approximately $285.8 million of non-recourse mortgage debt on 12 operating properties, (ii) assumed approximately $83.7 million of individual non-recourse mortgage debt relating to the acquisition of eight operating properties, including approximately $2.5 million of fair value debt adjustments and (iii) paid off approximately $81.6 million of individual non-recourse mortgage debt that encumbered 11 operating properties.
During 2007, the Company obtained individual construction loans on five merchant building projects and assumed one loan in connection with the acquisition of a merchant building project. Additionally, the Company repaid construction loans on three merchant building projects. As of December 31, 2007, the Company had a total of 15 construction loans with commitments of up to $360.3 million of which approximately $245.9 million has been funded. These loans had scheduled maturities ranging from one month to 33 months (excluding any extension options which may be available to the Company) and bear interest at rates ranging from 6.78% to 7.48% at December 31, 2007.
During May 2006, the Company filed a shelf registration statement on Form S-3ASR, which is effective for a term of three-years, for the unlimited future offerings, from time-to-time, of debt securities, preferred stock, depositary shares, common stock and common stock warrants.
During October 2007, the Company issued 18,400,000 Depositary Shares (the "Class G Depositary Shares"), after the exercise of an over-allotment option, each representing a one-hundredth fractional interest in a share of the Company’s 7.75% Class G Cumulative Redeemable Preferred Stock, par value $1.00 per share (the "Class G Preferred Stock"). Dividends on the Class G Depositary Shares are cumulative and payable quarterly in arrears at the rate of 7.75% per annum based on the $25.00 per share initial offering price, or $1.9375 per annum. The Class G Depositary Shares are redeemable, in whole or part, for cash on or after October 10, 2012, at the option of the Company, at a redemption price of $25.00 per depositary share, plus any accrued and unpaid dividends thereon. The Class G Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. Net proceeds from the sale of the Class G Depositary Shares, totaling approximately $444.5 million (after related transaction costs of $15.5 million) were used for general corporate purposes, including funding property acquisitions, investments in the Company’s institutional management programs and other investment activities. The Company also used a portion of the proceeds to partially repay amounts outstanding under its U.S. Credit Facility.
During 2007, the Company received approximately $38.1 million through employee stock option exercises and the dividend reinvestment program.
In connection with its intention to continue to qualify as a REIT for federal income tax purposes, the Company expects to continue paying regular dividends to its stockholders. These dividends will be paid from operating cash flows, which are expected to increase due to property acquisitions, growth in operating income in the existing portfolio and
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from other investments. Since cash used to pay dividends reduces amounts available for capital investment, the Company generally intends to maintain a conservative dividend payout ratio, reserving such amounts as it considers necessary for the expansion and renovation of shopping centers in its portfolio, debt reduction, the acquisition of interests in new properties and other investments as suitable opportunities arise and such other factors as the Board of Directors considers appropriate. Cash dividends paid increased to $384.5 million in 2007, compared to $332.6 million in 2006 and $293.3 million in 2005.
Although the Company receives substantially all of its rental payments on a monthly basis, it generally intends to continue paying dividends quarterly. Amounts accumulated in advance of each quarterly distribution will be invested by the Company in short-term money market or other suitable instruments. The Company’s Board of Directors declared a quarterly dividend of $0.40 per common share payable to shareholders of record on January 2, 2008, which was paid on January 15, 2008.
Contractual Obligations and Other Commitments
The Company has debt obligations relating to its revolving credit facilities, MTNs, senior notes, mortgages and construction loans with maturities ranging from less than one year to 28 years. As of December 31, 2007, the Company’s total debt had a weighted average term to maturity of approximately 5.5 years. In addition, the Company has non-cancelable operating leases pertaining to its shopping center portfolio. As of December 31, 2007, the Company has 79 shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land to the Company to construct and/or operate a shopping center. In addition, the Company has 19 non-cancelable operating leases pertaining to its retail store lease portfolio. The following table summarizes the Company’s debt maturities and obligations under non-cancelable operating leases as of December 31, 2007 (in millions):
2008
2009
2010
2011
2012
Thereafter
Total
Long-Term Debt, including interest (1)(2)
$742.9
$523.6
$500.7
$817.0
$405.8
$2,448.4
$5,438.4
Operating Leases
Ground Leases
$ 11.4
$ 10.9
$ 9.0
$ 6.7
$ 6.0
$115.6
$ 159.6
Retail Store Leases
$ 3.9
$ 3.7
$ 3.6
$ 3.1
$ 2.0
$ 1.3
$ 17.6
(1)
maturities utilized do not reflect extension options, which range from six months to two years.
(2)
for loans which have interest at floating rates, future interest expense was calculated using the rate as of December 31, 2007.
The Company has $100.0 million of medium term notes, $25.3 million of senior unsecured notes, $84.4 million of mortgage debt and $260.9 million of construction loans scheduled to mature in 2008. The Company anticipates satisfying these maturities with a combination of operating cash flows, its unsecured revolving credit facilities, new debt issuances and the sale of completed ground-up development projects.
The Company has issued letters of credit in connection with completion and repayment guarantees for construction loans encumbering certain of the Company’s ground-up development projects and guaranty of payment related to the Company’s insurance program. These letters of credit aggregate approximately $30.7 million.
In June 2006, the FASB issued Financial Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"), which clarifies the accounting for uncertainty in income taxes recognized in a company’s financial statements in accordance with FASB Statement No. 109, "Accounting for Income Taxes". The interpretation prescribes a recognition threshold and measurement attribute criteria for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The interpretation also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.
The Company adopted the provisions of FIN 48 on January 1, 2007. The Company does not have any material unrecognized tax benefits, therefore the adoption of FIN 48 did not have a material impact on the Company’s financial position or results of operations.
During June 2007, the Company entered into a joint venture, in which the Company has a non-controlling ownership interest, and acquired all of the common stock of InTown Suites Management, Inc. This investment was funded with approximately $186.0 million of new
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cross-collateralized non-recourse mortgage debt with a fixed interest rate of 5.59%, encumbering 35 properties, a $153.0 million three-year unsecured credit facility, which bears interest at LIBOR plus 0.325% and is guaranteed by the Company and the assumption of $278.6 million cross-collateralized non-recourse mortgage debt with fixed interest rates ranging from 5.19% to 5.89%, encumbering 86 properties. The joint venture partner has pledged its equity interest for any guaranty payment the Company is obligated to pay. The outstanding balance on the three-year unsecured credit facility was $149.0 million as of December 31, 2007. The joint venture obtained an interest rate swap at 5.37% on $128.0 million of this debt. The swap is designated as a cash flow hedge and as such adjustments are recorded in Other comprehensive income.
During 2007, the Company entered into a joint venture, in which the Company has a non-controlling ownership interest, to acquire a property in Houston, Texas. This investment was funded with a $24.5 million one-year unsecured credit facility with an additional one-year extension option, which bears interest at LIBOR plus 0.375% and is guaranteed by the Company. The outstanding balance on this credit facility as of December 31, 2007 was $24.5 million.
During April 2007, the Company entered into a joint venture, in which the Company has a 50% non-controlling ownership interest to acquire a property in Visalia, CA. Subsequent to this acquisition the joint venture obtained a three-year $6.0 million three-year promissory note which bears interest at LIBOR plus 0.75%, and has an extension option of two-years. This loan is jointly and severally guaranteed by the Company and the joint venture partner. As of December 31, 2007, the outstanding balance on this loan was $6.0 million.
The KimPru joint ventures, entities in which the Company holds a 15% non-controlling interest, with Prudential Real Estate Investors ("PREI") through three separate accounts managed by PREI obtained a $1.2 billion two-year credit facility provided by a consortium of banks and guaranteed by the Company. PREI guaranteed reimbursement to the Company of 85% of any guaranty payment the Company is obligated to make. As of December 31, 2007, there was $702.5 million outstanding under this credit facility, which bears interest at LIBOR plus 0.45% and is scheduled to mature in October 2008.
During 2006, an entity in which the Company has a preferred equity investment, located in Montreal, Canada, obtained a non-recourse construction loan, which is collateralized by the respective land and project improvements. Additionally, the Company has provided a guaranty to the lender and the developer partner has provided an indemnity to the Company for 25% of all debt. As of December 31, 2007, there was CAD $72.6 million (approximately USD $74.0 million) outstanding on this construction loan.
In connection with the construction of its development projects and related infrastructure, certain public agencies require performance and surety bonds be posted to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of December 31, 2007, there were approximately $90.4 million bonds outstanding.
Additionally, the RioCan Venture, an entity in which the Company holds a 50% non-controlling interest, has a CAD $7.0 million (approximately USD $7.1 million) letter of credit facility. This facility is jointly guaranteed by RioCan and the Company and had approximately CAD $5.5 million (approximately USD $5.6 million) outstanding as of December 31, 2007, relating to various development projects.
During 2005, an entity in which the Company has a preferred equity investment obtained a CAD $22.5 million (approximately USD $22.9 million) credit facility to finance the construction of a 0.1 million square foot shopping center property located in Kamloops, B.C. This facility bears interest at Royal Bank Prime Rate ("RBP") plus 0.5% per annum and is scheduled to mature in March 2008. The Company and its partner in this entity each have a limited and several guarantee of CAD $7.5 million (approximately USD $7.6 million) on this facility. As of December 31, 2007, there was CAD $21.1 million (approximately USD $21.5 million) outstanding on this facility.
During 2005, PL Retail, a joint venture in which the Company holds a 15% non-controlling interest, entered into a $39.5 million unsecured revolving credit facility, which bears interest at LIBOR plus 0.45% and was scheduled to mature in February 2008. During 2008, the loan was extended to February 2009. This facility is guaranteed by the Company and the joint venture partner has guaranteed reimbursement to the Company of 85% of any guaranty payment the Company is obligated to make. As of December 31, 2007, there was $24.6 million outstanding under this facility.
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Additionally, during 2005, the Company acquired three operating properties and one land parcel, through joint ventures, in which the Company holds 50% non-controlling interests. Subsequent to these acquisitions, the joint ventures obtained four individual one-year loans aggregating $20.4 million with interest rates ranging from LIBOR plus 0.50% to LIBOR plus 0.55%. During 2007, one of these properties was sold for a sales price of approximately $10.5 million, including the pay down of $5.0 million of debt. During 2007, two of these term loans were extended until May 2008 and one was extended until October 2008. As of December 31, 2007, there was an aggregate of $15.4 million outstanding on these loans. These loans are jointly and severally guaranteed by the Company and the joint venture partner.
Off-Balance Sheet Arrangements
Merchant Building Joint Ventures
At December 31, 2007, the Company has two merchant building projects through unconsolidated joint ventures in which the Company has 50% non-controlling interests. One project is financed with a $113.0 million ten-year permanent note, which bears interest at a rate of 5.55% per annum. The other project is financed with a term loan, which is 50% guaranteed by the Company, with a commitment of up to $28.0 million of which $28.0 million was outstanding as of December 31, 2007. This loan bears interest at LIBOR plus 1.55%, or 6.78% at December 31, 2007, and is scheduled to mature in September 2008.
Unconsolidated Real Estate Joint Ventures
The Company has investments in various unconsolidated real estate joint ventures with varying structures. These joint ventures operate either shopping center properties or are established for development projects. Such arrangements are generally with third-party institutional investors, local developers and individuals. The properties owned by the joint ventures are primarily financed with individual non-recourse mortgage loans. Non-recourse mortgage debt is generally defined as debt whereby the lenders’ sole recourse with respect to borrower defaults is limited to the value of the property collateralized by the mortgage. The lender generally does not have recourse against any other assets owned by the borrower or any of the constituent members of the borrower, except for certain specified exceptions listed in the particular loan documents (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K). These investments include the following joint ventures:
Venture
Kimco Ownership Interest
Number of Properties
Total GLA (in thousands)
Non- Recourse Mortgage Payable (in millions)
Recourse Notes Payable (in millions)
Number of Encumbered Properties
Average Interest Rate
Weighted Average Term (months)
KimPru (c)
15.00%
127
19,837
$2,085.5
$702.5(b)
92
5.66%
70.1
KIR (d)
45.00%
63
13,117
$1,018.7
$ -
61
6.96%
41.4
PL Retail (e)
15.00%
22
5,578
$ 658.2
$ 24.6(b)
22
6.17%
26.0
KUBS (f)
17.89%(a)
43
6,166
$ 770.2
$ -
43
5.70%
89.2
RioCan Venture (g)
50.00%
35
8,199
$ 763.9
$ -
35
6.12%
67.0
(a) Ownership % is a blended rate.
(b) See Contractual Obligations and Other Commitments regarding guarantees by the Company and its joint venture partners.
(c) Represents the Company’s joint ventures with Prudential Real Estate Investors.
(d) Represents the Kimco Income REIT, formed in 1998.
(e) Represents the Company’s joint venture formed from the acquisition of the Price Legacy Corporation.
(f) Represents the Company’s joint ventures with UBS Wealth Management North American Property Fund Limited.
(g) Represents the Company’s joint venture with RioCan Real Estate Investment Trust.
The Company has various other unconsolidated real estate joint ventures with varying structures. As of December 31, 2007, these unconsolidated joint ventures had individual non-recourse mortgage loans aggregating approximately $2.9 billion. The Company’s share of these non-recourse mortgages was approximately $707.7 million. (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.)
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Other Real Estate Investments
The Company maintains a Preferred Equity program, which provides capital to developers and owners of real estate properties. The Company accounts for its preferred equity investments under the equity method of accounting. As of December 31, 2007, the Company’s net investment under the Preferred Equity Program was approximately $484.1 million relating to 258 properties. As of December 31, 2007, these preferred equity investment properties had individual non-recourse mortgage loans aggregating approximately $1.7 billion. Due to the Company’s preferred position in these investments, the Company’s share of each investment is subject to fluctuation and is dependent upon property cash flows. The Company’s maximum exposure to losses associated with its preferred equity investments is primarily limited to its invested capital.
Additionally, during July 2007, the Company invested approximately $81.7 million of preferred equity capital in a portfolio comprised of 403 net leased properties which are divided into 30 master leased pools with each pool leased to individual corporate operators. These properties consist of a diverse array of free-standing restaurants, fast food restaurants, convenience and auto parts stores. As of December 31, 2007 these properties were encumbered by third party loans aggregating approximately $433.0 million with interest rates ranging from 5.08% to 10.47% with a weighted average interest rate of 9.3% and maturities ranging from 1.4 years to 15.2 years.
During June 2002, the Company acquired a 90% equity participation interest in an existing leveraged lease of 30 properties. The properties are leased under a long-term bond-type net lease whose primary term expires in 2016, with the lessee having certain renewal option rights. The Company’s cash equity investment was approximately $4.0 million. This equity investment is reported as a net investment in leveraged lease in accordance with SFAS No. 13, Accounting for Leases (as amended). The net investment in leveraged lease reflects the original cash investment adjusted by remaining net rentals, estimated unguaranteed residual value, unearned and deferred income and deferred taxes relating to the investment.
As of December 31, 2007, 18 of these properties were sold, whereby the proceeds from the sales were used to pay down the mortgage debt by approximately $32.1 million. As of December 31, 2007, the remaining 12 properties were encumbered by third-party non-recourse debt of approximately $48.8 million that is scheduled to fully amortize during the primary term of the lease from a portion of the periodic net rents receivable under the net lease. As an equity participant in the leveraged lease, the Company has no recourse obligation for principal or interest payments on the debt, which is collateralized by a first mortgage lien on the properties and collateral assignment of the lease. Accordingly, this debt has been offset against the related net rental receivable under the lease.
Effects of Inflation
Many of the Company's leases contain provisions designed to mitigate the adverse impact of inflation. Such provisions include clauses enabling the Company to receive payment of additional rent calculated as a percentage of tenants' gross sales above pre-determined thresholds, which generally increase as prices rise, and/or escalation clauses, which generally increase rental rates during the terms of the leases. Such escalation clauses often include increases based upon changes in the consumer price index or similar inflation indices. In addition, many of the Company's leases are for terms of less than 10 years, which permits the Company to seek to increase rents to market rates upon renewal. Most of the Company's leases require the tenant to pay an allocable share of operating expenses, including common area maintenance costs, real estate taxes and insurance, thereby reducing the Company's exposure to increases in costs and operating expenses resulting from inflation. The Company periodically evaluates its exposure to short-term interest rates and foreign currency exchange rates and will, from time-to-time, enter into interest rate protection agreements and/or foreign currency hedge agreements which mitigate, but do not eliminate, the effect of changes in interest rates on its floating-rate debt and fluctuations in foreign currency exchange rates.
New Accounting Pronouncements
In September 2006, the FASB issued Statement of Financial Accounting Standards ("SFAS") No. 157, Fair Value Measurement ("SFAS No. 157"), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurement. This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007. During February 2008, the FASB issued a Staff Position that will (i) partially defer the effective date of SFAS No. 157 for one year for certain nonfinancial assets and nonfinancial liabilities and (ii) remove certain leasing transactions from the scope of SFAS No. 157. The impact of adopting SFAS No. 157 is not expected to have a material impact on the Company’s financial position or results of operations.
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In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities ("SFAS No. 159"). SFAS No. 159 permits entities to choose to measure many financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS No. 159 is effective for fiscal years beginning after November 15, 2007. The impact of SFAS No. 159 is not expected to have a material impact on the Company’s financial position or results of operations.
In June 2007, the AICPA issued Statement of Position 07-1, Clarification of the Scope of the Audit and Accounting Guide for Investment Companies and Accounting by Parent Companies and Equity Method Investors for Investments in Investment Companies (“SOP 07-1”). SOP 07-1 sets forth more stringent criteria for qualifying as an investment company than does the predecessor Audit Guide. In addition, SOP 07-1 establishes new criteria for a parent company or equity method investor to retain investment company accounting in their consolidated financial statements. Investment companies record all their investments at fair value with changes in value reflected in earnings. SOP 07-1 was to be effective for the Company’s 2008 fiscal year, however, in October 2007 the FASB agreed to propose an indefinite delay, and, in February 2008, the FASB issued a final Staff Position to indefinitely delay the effective date of SOP 07-1.
In December 2007, the FASB issued SFAS No. 141 (revised 2007), Business Combinations ("SFAS No. 141(R)"). The objective of this statement is to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial reports about a business combination and its effects. To accomplish that, this Statement establishes principles and requirements for how the acquirer: (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree, (ii) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase and (iii) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This statement applies prospectively to business combinations for which the acquisition date is on or after the first annual reporting period beginning on or after December 15, 2008. An entity may not apply it before that date. The Company is currently assessing the impact the adoption of SFAS No. 141(R) would have on the Company’s financial position and results of operations.
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements, an Amendment of ARB No. 51("SFAS No. 160"). A noncontrolling interest, sometimes called a minority interest, is the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. The objective of this statement is to improve the relevance, comparability, and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards that require: (i) the ownership interests in subsidiaries held by parties other than the parent be clearly identified, labeled, and presented in the consolidated statement of financial position within equity, but separate from the parent’s equity, (ii) the amount of consolidated net income attributable to the parent and to the non-controlling interest be clearly identified and presented on the face of the consolidated statement of income, (iii) changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary be accounted for consistently and requires that they be accounted for similarly, as equity transactions, (iv) when a subsidiary is deconsolidated, any retained noncontrolling equity investment in the former subsidiary be initially measured at fair value, the gain or loss on the deconsolidation of the subsidiary is measured using the fair value of any noncontrolling equity investment rather than the carrying amount of that retained investment and (v) entities provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. This statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Earlier adoption is prohibited. The Company is currently assessing the impact the adoption of SFAS No. 160 would have on the Company’s financial position and results of operations.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
The Company’s primary market risk exposure is interest rate risk. The following table presents the Company’s aggregate fixed rate and variable rate domestic and foreign debt obligations outstanding as of December 31, 2007, with corresponding weighted-average interest rates sorted by maturity date. The information is presented in U.S. dollar equivalents, which is the Company’s reporting currency. The instruments’ actual cash flows are denominated in U.S. dollars, Canadian dollars and Mexican pesos as indicated by geographic description ($USD equivalent in millions).
54
2008
2009
2010
2011
2012
2013+
Total
Fair Value
U.S. Dollar Denominated
Secured Debt
Fixed Rate
$ 84.4
$ 60.7
$ 18.0
$ 45.1
$ 52.8
$ 435.2
$ 696.2
$ 682.1
Average Interest Rate
7.18%
7.04%
8.47%
7.43%
7.26%
6.20%
6.61%
Variable Rate
$ 260.9
$ 73.1
$ 54.1
$ -
$ -
$ 0.4
$ 388.5
$ 388.5
Average Interest Rate
6.00%
6.69%
6.70%
-
-
7.25%
5.71%
Unsecured Debt
Fixed Rate
$ 125.3
$ 180.0
$ 76.1
$ 360.3
$ 217.0
$ 1,528.1
$ 2,486.8
$ 2,454.9
Average Interest Rate
4.61%
6.98%
5.54%
6.35%
6.00%
5.47%
5.71%
Variable Rate
$ 2.4
$ -
$ 6.5
$ 259.0
$ -
$ -
$ 267.9
$ 267.9
Average Interest Rate
6.25%
-
7.52%
5.28%
-
-
5.35%
Canadian Dollar Denominated
Unsecured Debt
Fixed Rate
$ -
$ -
$ 151.8
$ -
$ -
$ 202.4
$ 354.2
$ 349.4
Average Interest Rate
-
-
4.45%
-
-
5.18%
4.87%
Mexican Pesos Denominated
Unsecured Debt
Variable Rate
$ 22.9
$ -
$ -
$ -
$ -
$ -
$ 22.9
$ 22.9
Average Interest Rate
8.92%
-
-
-
-
-
8.92%
Based on the Company’s variable-rate debt balances, interest expense would have increased by approximately $6.8 million in 2007 if short-term interest rates were 1.0% higher.
As of December 31, 2007, the Company had (i) Canadian investments totaling CAD $476.8 million (approximately USD $482.5 million) comprised of real estate joint venture investments and marketable securities, (ii) Mexican real estate investments of approximately MXP 8.0 billion (approximately USD $734.8 million) and (iii) Chilean real estate investments of approximately 1.6 billion Chilean Pesos ("CLP") (approximately USD $3.0 million). The foreign currency exchange risk has been partially mitigated through the use of local currency denominated debt. The Company has not, and does not plan to, enter into any derivative financial instruments for trading or speculative purposes. As of December 31, 2007, the Company had no other material exposure to market risk.
Item 8. Financial Statements and Supplementary Data
The response to this Item 8 is included as a separate section of this annual report on Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company’s management, with the participation of the Company’s chief executive officer and chief financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the
55
"Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the Company’s chief executive officer and chief financial officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective.
Changes in Internal Control over Financial Reporting
There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth fiscal quarter to which this report relates that have materially affected, or are reasonable likely to materially affect, the Company’s internal control over financial reporting.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the framework in Internal Control-Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2007.
The effectiveness of our internal control over financial reporting as of December 31, 2007 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein.
Item 9B. Other Information
Amendments to Articles of Incorporation or Bylaws.
On February 27, 2008, the Company's Board of Directors amended and restated the Company's bylaws, effective upon adoption. The full text of the Company's amended and restated bylaws is set forth in Exhibit 3.2 to this 10-K and is incorporated into this Item 9B by reference. The following summarizes these amendments.
Voting Requirements for Election of Directors
·
Previously, the bylaws provided that a plurality vote was sufficient to elect directors. As amended, Article II, Section 5 of the bylaws provides that, except in an election in which the number of nominees for director exceeds the number of directors to be elected, each director must be elected by a majority of the votes cast in person or by proxy at any meeting that includes the election of directors and at which a quorum is present.
·
For purposes of the election of directors, a majority of the votes cast means the affirmative vote of a majority of the total votes cast “for” and “against” such nominee. Votes cast do not include “abstentions” and any “broker non-votes.”
·
In an election in which the number of nominees for director exceeds the number of directors to be elected, directors will continue to be elected by a plurality of the votes cast.
Director Resignations
·
If an incumbent director fails to receive the requisite vote in an election, the bylaws require (1) the director to offer to resign from the Board, (2) the Nominating and Corporate Governance Committee of the Board to make a recommendation to the Board as to whether the Board should accept the resignation and (3) the Board to consider the recommendation of the Committee and to publicly disclose its decision regarding the resignation, and the reasons for its decision within 90 days after the date on which the results of the election were certified.
56
·
The Committee, in making its recommendation, and the Board, in making its decision, may each consider any factors or other information that it considers to be relevant. The director whose resignation is being considered may not participate in the recommendation of the Committee or the decision of the Board, except in the event that no nominee for director receives the vote required in the bylaws for election.
·
If an incumbent director's resignation is not accepted by the Board, the director will continue to serve until the next annual meeting of the stockholders and until his or her successor is duly elected and qualifies, or his or her earlier death, resignation, retirement or removal.
·
If a director's resignation is accepted by the Board, or if a non-incumbent nominee for director is not elected, the Board may fill any resulting vacancy in accordance with the bylaws.
Advance Notice Provisions
·
Article II, Section 12 was added to include advance notice provisions for stockholder nominations for director and stockholder business proposals at annual and special stockholder meetings. The advance notice period for annual stockholder meetings synchronizes the advance notice timing under the bylaws with the federal proxy rules. For annual stockholders meetings, the bylaws generally provide that such advance notice shall be delivered to the Secretary at the principal executive office of the Company not earlier than the 150th day nor later than 5:00 p.m., Eastern Time, on the 120th day prior to the first anniversary of the date of the proxy statement for the preceding year's annual meeting.
·
For special meetings of stockholders, stockholders must notify the Secretary of the Company of director nominations (if the Board has determined that directors will be elected at such special meeting) and other stockholder proposals not earlier than the 120th day prior to such special meeting and not later than 5:00 p.m., Eastern Time, on the later of the 90th day prior to such special meeting or the tenth day following the first public announcement of the date of the special meeting.
·
Additionally, the amended bylaws require certain information to be provided by the stockholder making a nomination or proposal, including information about the nominee or proposal, persons controlling or acting in concert with such stockholder and information about any hedging activities engaged in by them. The amended bylaws also establish procedures for the verification of information provided by the stockholder making the proposal.
Other Bylaw Amendments
·
Article II, Section 3 was added to establish procedures and requirements for stockholders to call a special meeting of stockholders, including, among other things, addressing issues relating to (1) who may call a special meeting of stockholders, (2) the fixing of a record date for determining stockholders entitled to request a special meeting and stockholders entitled to notice of and to vote at the meeting and (3) setting the time, date and place of special stockholders meetings.
·
Article II, Section 4 was amended to provide that (1) the chairman of a meeting of stockholders will have the power to adjourn the meeting and (2) a stockholders meeting may be adjourned without further notice (other than a statement at the meeting) to a date not more than 120 days after the original record date.
·
Article II, Section 7 was amended to (1) provide that a minor irregularity in providing notice of a stockholders meeting will not affect the validity of the meeting, (2) clarify that any business of the Company may be transacted at an annual meeting without being specifically designated in the notice while business transacted at a special meeting must be disclosed in the notice of the special meeting and (3) provide that the Company may postpone or cancel a meeting by making a public announcement.
·
Article II, Section 8 was amended to provide a more comprehensive list of the powers of the chairman in the conduct of the meeting, including, among other things, complying with state and local laws concerning safety and security.
57
·
Article II, Section 10 was added to (1) clarify the procedures for voting stock registered in the name of the Company and other business entities and (2) provide for a procedure by which a stockholder may certify that shares of stock are held for the account of another person.
·
Article II, Section 11 was added to provide for the appointment and powers of inspectors at stockholders meetings.
·
Article III, Section 4 was amended to provide that, when a vacancy on the Board of Directors results from an increase in the number of directors, a majority of the entire Board may fill the vacancy. Any other vacancy on the Board may be filled by a majority of the remaining directors, whether or not sufficient to constitute a quorum.
·
Article III, Section 5 was added to provide for the holding of regular meetings of the Board without notice other than a resolution setting the time and place for the meetings.
·
Article III, Section 9 was amended to clarify that, if enough directors have withdrawn from a meeting to leave less than a quorum but the meeting is not adjourned, the action of the majority of the number of directors necessary to constitute a quorum is the action of the Board, unless a greater proportion is required by applicable law, the charter or another provision of the bylaws.
·
Article III, Section 10 was added to more fully describe the procedures for choosing the chairman and secretary of Board meetings.
·
Article III, Section 11 was amended to permit unanimous Board consent via electronic transmission.
·
Article III, Section 13 was amended to provide compensation to the directors who are not officers of the Corporation based on an annual sum for their service on the Board of Directors and its committees.
·
Article III, Section 14 was added to clarify that directors and officers may rely on information prepared or presented by others whom the director or officer reasonably believes to be reliable and competent in the matters presented.
·
Article III, Section 15 was added to clarify the power of the Board and stockholders to ratify prior actions or inactions by the Company, including matters questioned in litigation.
·
Article III, Section 16 was added to provide for procedural flexibility in the event of an emergency.
·
Article IV, Sections 1-2 were added to (1) authorize the Board to delegate any of its powers to a committee, except as prohibited by law and (2) clarify Board committee meeting procedures with respect to notice, quorum and voting.
·
Article V was amended to clarify that reimbursement of expenses may be in advance of final disposition of a proceeding and that a director or officer who is threatened to be made a party to a proceeding is entitled to indemnification and advance of expenses. Article V was also amended to clarify that rights to indemnification and expense advance provided in the bylaws are not exclusive of other indemnification rights or expense advance.
·
Article VII, Section 1 was amended to expand the list of permitted officers.
·
Article VII, Section 5 was added to provide that any officer or agent of the Company may be removed, with or without cause, by the Board if in its judgment the best interests of the Company would be served thereby, but such removal will be without prejudice to the contract rights, if any, of the person so removed. Article VII, Section 5 was also amended to clarify procedures for the resignation of an officer.
·
Article VII, Section 7 was amended to clarify that, in the absence of a Chief Executive Officer, the President will be the CEO.
·
Article VII, Section 11 was amended to delete legacy provisions concerning the giving of bonds by the Treasurer.
·
Article VIII, Sections 1-3 were added to (1) provide that a stockholder is not entitled to a stock certificate and (2) make updates in accordance with the New York Stock Exchange's recently adopted Direct Registration System eligibility requirements.
·
In addition to the bylaw amendments summarized above, the Board also added and amended other sections of the Company's bylaws.
58
PART III
Item 10. Directors and Executive Officers of the Registrant
Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 13, 2008.
Information with respect to the Executive Officers of the Registrant follows Part I, Item 4 of this annual report on Form 10-K.
On June 13, 2007, the Company’s Chief Executive Officer submitted to the New York Stock Exchange (the "NYSE") the annual certification required by Section 303A.12 (a) of the NYSE Company Manual. In addition, the Company has filed with the Securities and Exchange Commission as exhibits to this Form 10-K the certifications, required pursuant to Section 302 of the Sarbanes-Oxley Act, of its Chief Executive Officer and Chief Financial Officer relating to the quality of its public disclosure.
Item 11. Executive Compensation
Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 13, 2008.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 13, 2008.
Item 13. Certain Relationships and Related Transactions
Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 13, 2008.
Item 14. Principal Accountant Fees and Services
Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 13, 2008.
59
PART IV
Item 15.
Exhibits, Financial Statements, Schedules and Reports on Form 8-K
(a)
1.
Financial Statements –
The following consolidated financial information is included as a separate section of this annual report on Form 10-K.
Form10-K Report Page
Report of Independent Registered Public Accounting Firm
68
Consolidated Financial Statements
Consolidated Balance Sheets as of December 31, 2007 and 2006
69
Consolidated Statements of Income for the years ended December 31, 2007, 2006 and 2005
70
Consolidated Statements of Comprehensive Income for the years ended December 31, 2007, 2006 and 2005
71
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2007, 2006 and 2005
72
Consolidated Statements of Cash Flows for the years ended December 31, 2007, 2006 and 2005
73
Notes to Consolidated Financial Statements
74
2.
Financial Statement Schedules - -
Schedule II - -
Valuation and Qualifying Accounts
123
Schedule III -
Real Estate and Accumulated Depreciation
124
Schedule IV -
Mortgage Loans on Real Estate
132
All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule.
3.
Exhibits -
The exhibits listed on the accompanying Index to Exhibits are filed as part of this report.
61
60
INDEX TO EXHIBITS
Exhibits
Form 10-K Page
2.1 –
Form of Plan of Reorganization of Kimco Realty Corporation [Incorporated by reference to Exhibit 2.1 to the Company's Registration Statement on Form S-11 No. 33-42588].
2.2 –
Agreement and Plan of Merger by and between Kimco Realty Corporation, KRC CT Acquisition Limited Partnership, KRC PC Acquisition Limited Partnership, Pan Pacific Retail Properties, Inc., CT Operating Partnership L.P., and Western/PineCreek, Ltd. dated July 9, 2006. [Incorporated by reference to Exhibit 2.1 to the Company’s Form 10-Q filed July 28, 2006].
2.3 –
Amendment No. 1 to Agreement and Plan of Merger, dated as of October 30, 2006, by and between Kimco Realty Corporation, KRC CT Acquisition Limited Partnership, KRC PC Acquisition Limited Partnership, Pan Pacific Retail Properties, Inc., CT Operating Partnership L.P., and Western/PineCreek, Ltd. [Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K dated November 3, 2006].
3.1 –
Articles of Amendment and Restatement of the Company, dated August 4, 1994 [Incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 1994].
*3.2 –
Amended and Restated By-laws of the Company dated February 27, 2008.
133
3.3 –
Reserved
3.4 –
Reserved
3.5 –
Articles Supplementary relating to the 6.65% Class F Cumulative Redeemable Preferred Stock, par value $1.00 per share, of the Company, dated May 7, 2003 [Incorporated by reference to the Company’s filing on Form 8-A dated June 3, 2003].
3.6 –
Articles Supplementary relating to the 7.75% Class G Cumulative Redeemable Preferred Stock, par value $1.00 per share, of the Company, dated October 2, 2007 [Incorporated by reference to the Company’s filing on Form 8-A12B dated October 9, 2007].
4.1 –
Agreement of the Company pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K [Incorporated by reference to Exhibit 4.1 to Amendment No. 3 to the Company's Registration Statement on Form S-11 No. 33-42588].
4.2 –
Certificate of Designations [Incorporated by reference to Exhibit 4(d) to Amendment No. 1 to the Registration Statement on Form S-3 dated September 10, 1993 (the "Registration Statement", Commission File No. 33-67552)].
61
INDEX TO EXHIBITS (continued)
Exhibits
Form 10-K Page
4.3 –
Indenture dated September 1, 1993, between Kimco Realty Corporation and Bank of New York (as successor to IBJ Schroder Bank and Trust Company) [Incorporated by reference to Exhibit 4(a) to the Registration Statement].
4.4 –
First Supplemental Indenture, dated as of August 4, 1994. [Incorporated by reference to Exhibit 4.6 to the 1995 Form 10-K.]
4.5 –
Second Supplemental Indenture, dated as of April 7, 1995 [Incorporated by reference to Exhibit 4(a) to the Company's Current Report on Form 8-K dated April 7, 1995 (the "April 1995 8-K")].
4.6 –
Form of Medium-Term Note (Fixed Rate) [Incorporated by reference to Exhibit 4.6 to the 2001 Form 10-K].
4.7 –
Form of Medium-Term Note (Floating Rate) [Incorporated by reference to Exhibit 4.7 to the 2001 Form 10-K].
4.8 –
Indenture dated April 1, 2005, between Kimco North Trust III, Kimco Realty Corporation, as Guarantor and BNY Trust Company of Canada, as Trustee [Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated April 21, 2005].
4.9 –
Third Supplemental Indenture dated as of June 2, 2006. [Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated June 5, 2006].
4.10 –
Fifth Supplemental Indenture, dated as of October 31, 2006, among Kimco Realty Corporation, Pan Pacific Retail Properties, Inc. and Bank of New York Trust Company, N.A., as trustee [Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated November 3, 2006].
4.11 –
First Supplemental Indenture, dated as of October 31, 2006, among Kimco Realty Corporation, Pan Pacific Retail Properties, Inc. and Bank of New York Trust Company, N.A., as trustee [Incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K dated November 3, 2006].
4.12 –
First Supplemental Indenture, dated as of June 2, 2006, among Kimco North Trust III, Kimco Realty Corporation, as Guarantor and BNY Trust Company of Canada, as trustee.[Incorporated by reference to Exhibit 4.12 to the 2006 Form 10-K].
4.13 –
Second Supplemental Indenture, dated as of August 16, 2006, among Kimco North Trust III, Kimco Realty Corporation, as Guarantor and BNY Trust Company of Canada, as trustee.[Incorporated by reference to Exhibit 4.13 to the 2006 Form 10-K].
10.1 –
Management Agreement between the Company and KC Holdings, Inc. [Incorporated by reference to Exhibit 10.2 to the Company’s Registration Statement on Form S-11 No. 33-47915].
10.2 –
Amended and Restated Stock Option Plan [Incorporated by reference to Exhibit 10.3 to the 1995 Form 10-K].
10.3 –
Employment Agreement between Kimco Realty Corporation and Michael J. Flynn, dated November 1, 1998[Incorporated by reference to Exhibit 10.4 to the 1998 Form 10-K]
62
INDEX TO EXHIBITS (continued)
Exhibits
Form 10-K Page
10.4 –
Restricted Equity Agreement, Non-Qualified and Incentive Stock Option Agreement, and Price Condition Non-Qualified and Incentive Stock Option Agreement between Kimco Realty Corporation and Michael J. Flynn, each dated November 1, 1995 [Incorporated by reference to Exhibit 10.5 to the 1995 Form 10-K].
10.5 –
Employment Agreement between Kimco Realty Corporation and Michael J. Flynn, dated July 21, 2004 [Incorporated by reference to Exhibit 10.14 to the Company’s Form 10-Q filed on November 5, 2004].
10.6 –
Employment Agreement between Kimco Realty Corporation and Michael V. Pappagallo, dated January 1, 2002 [Incorporated by reference to Exhibit 10.6 to the 2001 Form 10-K].
10.7 –
Employment Agreement between Kimco Realty Corporation and Jerald Friedman, dated January 13, 1998 [Incorporated by reference to Exhibit 10.10 to the Company’s and the Price REIT, Inc.’s Joint Proxy Statement/Prospectus on Form S-4 No. 333-52667].
10.8 –
First Amendment to Amended and Restated Executive Employment Agreement between Kimco Realty Corporation and Jerald Friedman, dated January 1, 2002 [Incorporated by reference to Exhibit 10.8 to the 2001 Form 10-K].
10.9 –
The 1998 Equity Participation Plan [Incorporated by reference to the Company’s and The Price REIT, Inc.’s Joint Proxy/Prospectus on Form S-4 No. 333-52667].
10.10 –
Employment Agreement between Kimco Realty Corporation and David B. Henry the Company commenced a five-year employment agreement with Mr. Henry pursuant to which Mr. Henry will serve as Chief Investment Officer and has been nominated as Vice Chairman of the Board of Directors [Incorporated by reference to Exhibit 10.11 to the Company’s Form 10-Q filed on May 10, 2001].
10.11 –
Employment Agreement between Kimco Realty Corporation and David B. Henry, dated July 26, 2004 [Incorporated by reference to Exhibit 10.14 to the Company’s Form 10-Q filed on November 5, 2004].
10.12 –
$500,000,000 Credit Agreement dated as of June 3, 2003, among Kimco Realty Corporation, the Several Lenders from Time to Time Parties Hereto, JPMorgan Chase Bank as Issuing Lender, Bank One, NA, Wachovia Bank, National Association as Syndication Agents, UBS AG, Cayman Island Branch, The Bank of Nova Scotia, New York Agency as Documentation Agents, The Bank of New York, Eurohypo AG, New York Branch, Keybank National Association, Merrill Lynch Bank, USA, Suntrust as Co-Agents and JPMorgan Chase as Administrative Agent [Incorporated by reference to Exhibit 10.11 to the Company’s Form 10-Q filed on August 11, 2003].
10.13 –
$400,000,000 Credit Agreement dated as of October 1, 2003, among Kimco Realty Corporation, the Several Lenders from Time to Time Parties Hereto, Wachovia Bank, National Association and the Bank of Nova Scotia, as Syndication Agents, Keybank National Association as Documentation Agent, Bank One, NA, as Administrative Agent, Banc One Capital Markets, Inc. and Scotia Capital as Co-Bookrunners and Co-Lead Arrangers [Incorporated by reference to Exhibit 10.12 to the Company’s Form 10-Q filed on November 10, 2003].
63
INDEX TO EXHIBITS (continued)
Exhibits
Form 10-K Page
10.14 –
CAD $150,000,000 Credit Agreement dated September 21, 2004, among Kimco North Trust I, North Trust II, North Trust III, North Trust V, North Trust VI, Kimco North Loan Trust IV, Kimco Realty Corporation, the Several Lenders from Time to Time Parties Hereto, Royal Bank of Canada, as Issuing Lender and Administrative Agent, The Bank of Nova Scotia and Bank of America, N.A., as Syndication Agents, Canadian Imperial Bank of Commerce as Documentation Agent and RBC Capital Markets, as Bookrunner and Lead Arranger [Incorporated by reference to Exhibit 10.14 to the Company’s Current Report on Form 8-K dated September 21, 2004].
10.17 –
Amendment and Restated 1998 Equity Participation Plan [Incorporated by reference to Exhibit 10.17 to the Company’s 2004 Form 10-K].
10.18 –
CAD $250,000,000 Amended and Restated Credit Facility dated March 31, 2005, with Royal Bank of Canada, as Issuing Lender and Administrative Agent and various lenders [Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 31, 2005].
10.19 –
$850,000,000 Amended and Restated Unsecured Revolving Credit Facility dated July 26, 2005, with JPMorgan Chase Bank NA, as Issuing Lender and Administrative Agent and various lenders [Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated July 26, 2005].
10.20 –
Employment Agreement between Kimco Realty Corporation and Jerald Friedman, dated September 21, 2005 [Incorporated by reference to Exhibit 10.16 to the Company’s Form 10-Q filed on November 4, 2005].
10.21 –
CAD $250,000,000 Amended and Restated Credit Facility dated January 25, 2006, with Royal Bank of Canada, as Issuing Lender and Administrative Agent and various lenders.
10.22 –
$1.2 billion Credit Agreement, dated as of October 30, 2006, among PK Sale LLC, as borrower, PRK Holdings I LLC, PRK Holdings II LLC and PK Holdings III LLC, as guarantors, Kimco Realty Corporation, as guarantor, the lenders party hereto from time to time, JP Morgan Chase Bank, N.A., as Administrative Agent and Bank of America, N.A., as Co-Syndication Agents, Scotia Banc, Inc. and Wells Fargo Bank, National Association as Co-Documentation Agents, The Royal Bank of Scotland, PLC, Sumitomo Mitsui Banking Corporation, and West LB AG, New York Branch as Co-Managing Agents, and The Bank of New York, Mizuho Corporate Bank (USA), Royal Bank of Canada, and U.S. Bank, National Association, as Co-Agents [Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated November 3, 2006].
10.23 –
$1.5 billion Credit Agreement, dated as of October 25, 2007, among Kimco Realty Corporation, the subsidiaries of Kimco from time to time parties thereto, the several banks, financial institutions and other entities from time to time parties thereto, Bank of America, N.A., the Bank of Nova Scotia, New York Agency, and Wachovia Bank, National Association, as Syndication Agents, UBS Securities LLC, Deutsche Bank Securities, Inc., Royal Bank of Canada and the Royal Bank of Scotland PLC, as Documentation Agents, the Bank of Tokyo-Mitsubishi UFJ, Ltd., Citicorp North America, Inc., Merrill Lynch Bank USA, Morgan Stanley Bank, Regions Bank, Sumitomo Mitsui Banking Corporation and U.S. Bank National Association, as Managing Agents, The Bank of New York, Barclays Bank PLC, Eurohypo AG New York Branch, Suntrust Bank and Wells Fargo Bank National Association, as Co-Agents, and JPMorgan Chase Bank, N.A., as Administrative Agent for the lenders thereunder. [Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated October 25, 2007].
64
INDEX TO EXHIBITS (continued)
Exhibits
Form 10-K Page
10.24 –
Employment Agreement between Kimco Realty Corporation and David B. Henry, dated March 8, 2007. [Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 21, 2007].
*10.25 –
CAD $250,000,000 Amended and Restated Credit Facility dated January 11, 2008, with Royal Bank of Canada as Issuing lender and Administrative Agent and various lenders.
154
*10.26 –
Employment Agreement between Kimco Realty Corporation and Michael J. Flynn dated October 15, 2007.
170
*12.1 –
Computation of Ratio of Earnings to Fixed Charges
182
*12.2 –
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends
183
*21.1 –
Subsidiaries of the Company
184
*23.1 –
Consent of PricewaterhouseCoopers LLP
195
*31.1 –
Certification of the Company’s Chief Executive Officer, Milton Cooper, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
196
*31.2 –
Certification of the Company’s Chief Financial Officer, Michael V. Pappagallo, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
197
*32.1 –
Certification of the Company’s Chief Executive Officer, Milton Cooper, and the Company’s Chief Financial Officer, Michael V. Pappagallo, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
198
______________
*
Filed herewith.
65
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
KIMCO REALTY CORPORATION
(Registrant)
By:
/s/ Milton Cooper
Milton Cooper
Chief Executive Officer
Dated:
February 27, 2008
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.
Signature
Title
Date
/s/ Martin S. Kimmel
Chairman (Emeritus) of
February 27, 2008
Martin S. Kimmel
the Board of Directors
/s/ Milton Cooper
Chairman of the Board
of Directors and
February 27, 2008
Milton Cooper
Chief Executive Officer
/s/ Michael J. Flynn
Vice Chairman of the Board of Directors,
February 27, 2008
Michael J. Flynn
President and Chief Operating Officer
/s/ David B. Henry
Vice Chairman of the Board of Directors
February 27, 2008
David B. Henry
and Chief Investment Officer
/s/ Richard G. Dooley
Director
February 27, 2008
Richard G. Dooley
/s/ Joe Grills
Director
February 27, 2008
Joe Grills
/s/ F. Patrick Hughes
Director
February 27, 2008
F. Patrick Hughes
/s/ Frank Lourenso
Director
February 27, 2008
Frank Lourenso
/s/ Richard Saltzman
Director
February 27, 2008
Richard Saltzman
/s/ Michael V. Pappagallo
Executive Vice President -
February 27, 2008
Michael V. Pappagallo
Chief Financial Officer
/s/ Glenn G. Cohen
Vice President -
February 27, 2008
Glenn G. Cohen
Treasurer
/s/ Paul Westbrook
Director of Accounting
February 27, 2008
Paul Westbrook
66
ANNUAL REPORT ON FORM 10-K
ITEM 8, ITEM 15 (a) (1) and (2)
INDEX TO FINANCIAL STATEMENTS
AND
FINANCIAL STATEMENT SCHEDULES
Form10-K Page
KIMCO REALTY CORPORATION AND SUBSIDIARIES
Report of Independent Registered Public Accounting Firm
68
Consolidated Financial Statements and Financial Statement Schedules:
Consolidated Balance Sheets as of December 31, 2007 and 2006
69
Consolidated Statements of Income for the years ended December 31, 2007, 2006 and 2005
70
Consolidated Statements of Comprehensive Income for the years ended December 31, 2007, 2006 and 2005
71
Consolidated Statements of Stockholders' Equity for the years ended December 31, 2007, 2006 and 2005
72
Consolidated Statements of Cash Flows for the years ended December 31, 2007, 2006 and 2005
73
Notes to Consolidated Financial Statements
74
Financial Statement Schedules:
II.
Valuation and Qualifying Accounts
123
III.
Real Estate and Accumulated Depreciation
124
IV.
Mortgage Loans on Real Estate
132
67
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
of Kimco Realty Corporation:
In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of Kimco Realty Corporation and its Subsidiaries (collectively, the "Company") at December 31, 2007 and 2006, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2007, in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedules listed in the index appearing under Item 15(a)(2)present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2007, based on criteria established inInternal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these financial statements and financial statement schedules, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included under Item 9A. Our responsibility is to express opinions on these financial statements, on the financial statement schedules, and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ PricewaterhouseCoopers LLP
New York, New York
February 27, 2008
68
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share information)
December 31,
December 31,
2007
2006
Assets:
Real Estate
Rental property
Land
$ 1,262,879
$ 978,819
Building and improvements
4,917,750
3,984,518
6,180,629
4,963,337
Less, accumulated depreciation and amortization
977,444
806,670
5,203,185
4,156,667
Real estate under development
1,144,406
1,037,982
Real estate, net
6,347,591
5,194,649
Investments and advances in real estate joint ventures
1,246,917
1,067,918
Other real estate investments
615,016
451,731
Mortgages and other financing receivables
153,847
162,669
Cash and cash equivalents
87,499
345,065
Marketable securities
212,988
202,659
Accounts and notes receivable
88,017
83,418
Deferred charges and prepaid expenses
121,690
95,163
Other assets
224,251
266,008
Total assets
$ 9,097,816
$ 7,869,280
Liabilities & Stockholders' Equity:
Notes payable
$ 3,131,765
$ 2,748,345
Mortgages payable
838,736
567,917
Construction loans payable
245,914
270,981
Accounts payable and accrued expenses
161,526
163,668
Dividends payable
112,052
93,222
Other liabilities
265,090
232,946
Total liabilities
4,755,083
4,077,079
Minority interests
448,159
425,242
Commitments and contingencies
Stockholders' equity:
Preferred Stock , $1.00 par value, authorized 3,232,000 and 3,600,000 shares, respectively
Class F Preferred Stock, $1.00 par value, authorized 700,000 shares
Issued and outstanding 700,000 shares
700
700
Aggregate liquidation preference $175,000
Class G Preferred Stock, $1.00 par value, authorized 184,000 shares
Issued and outstanding 184,000 shares
184
-
Aggregate liquidation preference $460,000
Common stock, $.01 par value, authorized 750,000,000 and 300,000,000 shares, respectively
Issued 253,350,144 and 251,416,749, shares; outstanding 252,803,564 and 250,870,169, respectively.
2,528
2,509
Paid-in capital
3,677,509
3,178,016
Retained earnings
180,005
140,509
3,860,926
3,321,734
Accumulated other comprehensive income
33,648
45,225
Total stockholders' equity
3,894,574
3,366,959
Total liabilities and stockholders' equity
$ 9,097,816
$ 7,869,280
The accompanying notes are an integral part of these consolidated financial statements.
69
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the Years Ended 2007, 2006 and 2005
(in thousands, except per share data)
Year Ended December 31,
2007
2006
2005
Revenues from rental property
$ 681,553
$ 587,547
$ 501,569
Rental property expenses:
Rent
(12,131)
(11,531)
(10,012)
Real estate taxes
(83,571)
(74,607)
(64,067)
Operating and maintenance
(90,013)
(72,701)
(58,167)
Mortgage and other financing income
14,197
18,816
27,586
Management and other fee income
54,844
40,684
30,474
Depreciation and amortization
(189,650)
(139,263)
(100,517)
General and administrative expenses
(103,882)
(77,324)
(56,475)
Interest, dividends and other investment income
30,951
55,822
28,345
Other (expense)/income, net
(10,590)
8,928
5,071
Interest expense
(213,674)
(170,677)
(126,432)
Income from continuing operations before income taxes, income from other real estate investments, equity in
income of joint ventures, minority interests in income, gain on sale of development properties and adjustment
of property carrying values
78,034
165,694
177,375
Benefit/(provision) for income taxes
44,490
(4,387)
(165)
Income from other real estate investments
78,524
77,062
56,751
Equity in income of joint ventures, net
173,363
105,525
77,454
Minority interests in income, net
(34,144)
(26,166)
(12,164)
Gain on sale of development properties,
net of tax of $16,040, $12,155 and $10,824, respectively
24,059
25,121
22,812
Adjustment of property carrying values,
net of tax of $3,400, $0 and $0, respectively
(5,100)
-
-
Income from continuing operations
359,226
342,849
322,063
Discontinued operations:
Income from discontinued operating properties
32,773
13,914
15,485
Minority interests in income
(5,848)
(1,585)
(573)
Loss on operating properties held for sale/sold
(1,832)
(1,421)
(5,098)
Gain on disposition of operating properties, net of tax
5,538
72,042
28,918
Income from discontinued operations
30,631
82,950
38,732
Gain on transfer of operating properties
-
1,394
2,301
Loss on transfer of operating property
-
-
(150)
Gain on sale of operating properties, net of tax
2,708
1,066
682
Total gain on transfer or sale of operating properties, net of tax
2,708
2,460
2,833
Income before extraordinary item
392,565
428,259
363,628
Extraordinary gain from joint venture resulting from purchase price
allocation, net of tax and minority interest
50,265
-
-
Net income
442,830
428,259
363,628
Preferred stock dividends
(19,659)
(11,638)
(11,638)
Net income available to common shareholders
$ 423,171
$ 416,621
$ 351,990
Per common share:
Income from continuing operations:
-Basic
$ 1.36
$ 1.39
$ 1.38
-Diluted
$ 1.33
$ 1.36
$ 1.36
Net income :
-Basic
$ 1.68
$ 1.74
$ 1.55
-Diluted
$ 1.65
$ 1.70
$ 1.52
Weighted average shares:
-Basic
252,129
239,552
226,641
-Diluted
257,058
244,615
230,868
The accompanying notes are an integral part of these consolidated financial statements.
70
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
Year Ended December 31,
2007
2006
2005
Net income
$ 442,830
$ 428,259
$ 363,628
Other comprehensive income:
Change in unrealized gain/(loss) on marketable securities
(25,803)
(26,467)
26,689
Change in unrealized gain/(loss) on foreign currency hedge agreements
(1,470)
143
2,536
Change in foreign currency translation adjustment
15,696
2,503
2,040
Other comprehensive income
(11,577)
(23,821)
31,265
Comprehensive income
$ 431,253
$ 404,438
$ 394,893
The accompanying notes are an integral part of these consolidated financial statements.
71
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
For the Years Ended December 31, 2007, 2006 and 2005
(in thousands, except per share information)
Paid-in Capital
Retained Earnings / (Cumulative Distributions in Excess of Net Income)
Accumulated Other Comprehensive Income
Total Stockholders' Equity
Preferred Stock
Common Stock
Issued
Amount
Issued
Amount
Balance, January 1, 2005
700
$ 700
224,854
$ 2,248
$2,199,420
$ (3,749)
$ 37,781
$ 2,236,400
Net income
363,628
363,628
Dividends ($1.27 per common share; $1.6625
Class F Depositary Share, respectively)
(300,024)
(300,024)
Issuance of common stock
242
3
6,837
6,840
Exercise of common stock options
2,963
30
44,467
44,497
Amortization of stock option expense
4,608
4,608
Other comprehensive income
31,265
31,265
Balance, December 31, 2005
700
700
228,059
2,281
2,255,332
59,855
69,046
2,387,214
Net income
428,259
428,259
Dividends ($1.38 per common share; $1.6625
Class F Depositary Share, respectively)
(347,605)
(347,605)
Issuance of common stock
20,614
206
870,465
870,671
Exercise of common stock options
2,197
22
42,007
42,029
Amortization of stock option expense
10,212
10,212
Other comprehensive income
(23,821)
(23,821)
Balance, December 31, 2006
700
700
250,870
2,509
3,178,016
140,509
45,225
3,366,959
Net income
442,830
442,830
Dividends ($1.52 per common share; $1.6625
Class F Depositary Share, and $0.4359 per
Class G Depositary Share, respectively)
(403,334)
(403,334)
Issuance of common stock
50
1
2,413
2,414
Exercise of common stock options
1,884
18
40,546
40,564
Issuance of Class G Preferred Stock
184
184
444,283
444,467
Amortization of stock option expense
12,251
12,251
Other comprehensive income
(11,577)
(11,577)
Balance, December 31, 2007
884
$ 884
252,804
$ 2,528
$3,677,509
$ 180,005
$ 33,648
$ 3,894,574
The accompanying notes are an integral part of these consolidated financial statements.
72
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Year Ended December 31,
2007
2006
2005
Cash flows from operating activities:
Net income
$ 442,830
$ 428,259
$ 363,628
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization
191,270
144,767
108,042
Extraordinary item
(50,265)
-
-
Loss on operating properties held for sale/sold/transferred
1,832
1,421
5,248
Adjustment of property carrying values
8,500
-
-
Gain on sale of development properties
(40,099)
(37,276)
(33,636)
Gain on sale/transfer of operating properties
(9,800)
(77,300)
(31,901)
Minority interests in income of partnerships, net
39,992
27,751
12,446
Equity in income of joint ventures, net
(173,363)
(106,930)
(77,454)
Income from other real estate investments
(64,046)
(54,494)
(40,562)
Distributions from joint ventures
403,032
152,099
116,765
Cash retained from excess tax benefits
(2,471)
(2,926)
-
Change in accounts and notes receivable
(4,876)
(17,778)
(12,156)
Change in accounts payable and accrued expenses
1,361
38,619
10,606
Change in other operating assets and liabilities
(77,908)
(40,643)
(10,229)
Net cash flows provided by operating activities
665,989
455,569
410,797
Cash flows from investing activities:
Acquisition of and improvements to operating real estate
(1,077,202)
(547,001)
(431,514)
Acquisition of and improvements to real estate under development
(640,934)
(619,083)
(452,722)
Investment in marketable securities
(55,235)
(86,463)
(93,299)
Proceeds from sale of marketable securities
35,525
83,832
46,692
Proceeds from transferred operating/development properties
69,869
1,186,851
128,537
Investments and advances to real estate joint ventures
(413,172)
(472,666)
(267,287)
Reimbursements of advances to real estate joint ventures
293,537
183,368
130,590
Other real estate investments
(192,890)
(254,245)
(123,005)
Reimbursements of advances to other real estate investments
87,925
74,677
26,969
Investment in mortgage loans receivable
(97,592)
(154,894)
(82,305)
Collection of mortgage loans receivable
94,720
125,003
90,709
Other investments
(26,688)
(123,609)
(3,152)
Reimbursements of other investments
55,361
16,113
-
Settlement of net investment hedges
-
(953)
(34,580)
Proceeds from sale of operating properties
59,450
110,404
89,072
Proceeds from sale of development properties
299,715
232,445
259,280
Net cash flows used for investing activities
(1,507,611)
(246,221)
(716,015)
Cash flow from financing activities:
Principal payments on debt, excluding
normal amortization of rental property debt
(82,337)
(61,758)
(66,794)
Principal payments on rental property debt
(14,014)
(11,062)
(8,296)
Principal payments on construction loan financings
(78,295)
(79,399)
(98,002)
Proceeds from mortgage/construction loan financings
413,488
174,087
265,418
Borrowings under credit facilities
627,369
317,661
210,188
Repayment of borrowings under credit facilities
(343,553)
(653,219)
(156,486)
Proceeds from issuance of unsecured senior notes
300,000
478,947
672,429
Repayment of unsecured senior notes
(250,000)
(185,000)
(200,250)
Financing origination costs
(10,819)
(11,442)
(9,538)
Redemption of minority interests in real estate partnerships
(80,972)
(31,554)
(21,024)
Dividends paid
(384,502)
(332,552)
(293,345)
Cash retained from excess tax benefits
2,471
2,926
-
Proceeds from issuance of stock
485,220
451,809
48,971
Net cash flows provided by financing activities
584,056
59,444
343,271
Change in cash and cash equivalents
(257,566)
268,792
38,053
Cash and cash equivalents, beginning of year
345,065
76,273
38,220
Cash and cash equivalents, end of year
$ 87,499
$ 345,065
$ 76,273
Interest paid during the year (net of capitalized interest
of $25,505, $22,741, and $12,587, respectively)
$ 215,121
$ 153,664
$ 121,087
Income taxes paid during the year
$ 14,292
$ 9,350
$ 13,763
The accompanying notes are an integral part of these consolidated financial statements.
73
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Amounts relating to the number of buildings, square footage, tenant and occupancy data and estimated project costs are unaudited.
1. Summary of Significant Accounting Policies:
Business
Kimco Realty Corporation (the "Company" or "Kimco"), its subsidiaries, affiliates and related real estate joint ventures are engaged principally in the operation of neighborhood and community shopping centers which are anchored generally by discount department stores, supermarkets or drugstores. The Company also provides property management services for shopping centers owned by affiliated entities, various real estate joint ventures and unaffiliated third parties.
Additionally, in connection with the Tax Relief Extension Act of 1999 (the "RMA"), which became effective January 1, 2001, the Company is permitted to participate in activities which it was precluded from previously in order to maintain its qualification as a Real Estate Investment Trust ("REIT"), so long as these activities are conducted in entities which elect to be treated as taxable subsidiaries under the Internal Revenue Code, as amended (the "Code"), subject to certain limitations. As such, the Company, through its taxable REIT subsidiaries, is engaged in various retail real estate related opportunities including (i) merchant building through it’s wholly-owned taxable REIT subsidiaries including Kimco Developers, Inc. ("KDI"), which are primarily engaged in the ground-up development of neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) retail real estate advisory and disposition services which primarily focuses on leasing and disposition strategies of retail real estate controlled by both healthy and distressed and/or bankrupt retailers and (iii) acting as an agent or principal in connection with tax deferred exchange transactions.
The Company seeks to reduce its operating and leasing risks through diversification achieved by the geographic distribution of its properties, avoiding dependence on any single property, and a large tenant base. At December 31, 2007, the Company's single largest neighborhood and community shopping center accounted for only 1.7% of the Company's annualized base rental revenues and only 0.8% of the Company’s total shopping center gross leasable area ("GLA"). At December 31, 2007, the Company’s five largest tenants were The Home Depot, TJX Companies, Sears Holdings, Kohl’s and Wal-Mart, which represented approximately 3.2%, 2.8%, 2.3%, 2.0% and 1.9%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
The principal business of the Company and its consolidated subsidiaries is the ownership, development, management and operation of retail shopping centers, including complementary services that capitalize on the Company’s established retail real estate expertise. The Company does not distinguish its principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company believes it has a single reportable segment for disclosure purposes in accordance with accounting principles generally accepted in the United States of America ("GAAP").
Principles of Consolidation and Estimates
The accompanying Consolidated Financial Statements include the accounts of the Company, its subsidiaries, all of which are wholly-owned, and all entities in which the Company has a controlling interest, including where the Company has been determined to be a primary beneficiary of a variable interest entity in accordance with the provisions and guidance of Interpretation No. 46(R), Consolidation of Variable Interest Entities ("FIN 46(R)") or meets certain criteria of a sole general partner or managing member as identified in accordance with Emerging Issues Task Force ("EITF") Issue 04-5, Investor’s Accounting for an Investment in a Limited Partnership when the Investor is the Sole General Partner and the Limited Partners have Certain Rights ("EITF 04-5"). All intercompany balances and transactions have been eliminated in consolidation.
74
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
GAAP requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during a reporting period. The most significant assumptions and estimates relate to the valuation of real estate and related intangible assets and liabilities, depreciable lives, revenue recognition, the collectability of trade accounts receivable, and the realizability of deferred tax assets. Application of these assumptions requires the exercise of judgment as to future uncertainties, and, as a result, actual results could differ from these estimates.
Minority Interests
Minority interests represent the portion of equity that the Company does not own in those entities it consolidates as a result of having a controlling interest or determined that the Company was the primary beneficiary of a variable interest entity in accordance with the provisions and guidance of FIN 46(R).
Minority interests also include partnership units issued from consolidated subsidiaries of the Company in connection with certain property acquisitions. These units have a stated redemption value or a redemption amount based upon the Adjusted Current Trading Price, as defined, of the Company’s common stock ("Common Stock") and provide the unit holders various rates of return during the holding period. The unit holders generally have the right to redeem their units for cash at any time after one year from issuance. The Company typically has the option to settle redemption amounts in cash or Common Stock for the issuance of convertible units. The Company evaluates the terms of the partnership units issued in accordance with Statement of Financial Accounting Standards ("SFAS") No. 150, Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity, and EITF D-98, Classification and Measurement of Redeemable Securities, to determine if the units are mandatorily redeemable and as such accounts for them accordingly.
Real Estate
Real estate assets are stated at cost, less accumulated depreciation and amortization. If there is an event or a change in circumstances that indicates that the basis of a property (including any related amortizable intangible assets or liabilities) may not be recoverable, then management will assess any impairment in value by making a comparison of (i) the current and projected operating cash flows (undiscounted and without interest charges) of the property over its estimated holding period, and (ii) the net carrying amount of the property. If the current and projected operating cash flows (undiscounted and without interest charges) are less than the carrying value of the property, the carrying value would be adjusted to an amount to reflect the estimated fair value of the property.
When a real estate asset is identified by management as held for sale, the Company ceases depreciation of the asset and estimates the sales price, net of selling costs. If, in management’s opinion, the net sales price of the asset is less than the net book value of the asset, an adjustment to the carrying value would be recorded to reflect the estimated fair value of the property.
Upon acquisition of real estate operating properties, the Company estimates the fair value of acquired tangible assets (consisting of land, building, building improvements and tenant improvements) and identified intangible assets and liabilities (consisting of above and below-market leases, in-place leases and tenant relationships), assumed debt and redeemable units issued in accordance with SFAS No. 141, Business Combinations ("SFAS No. 141"), at the date of acquisition, based on evaluation of information and estimates available at that date. Based on these estimates, the Company allocates the initial purchase price to the applicable assets and liabilities. As final information regarding fair value of the assets acquired and liabilities assumed is received and estimates are refined, appropriate adjustments are made to the purchase price allocation. The allocations are finalized within twelve months of the acquisition date.
The Company utilizes methods similar to those used by independent appraisers in estimating the fair value of acquired assets and liabilities. The fair value of the tangible assets of an acquired property considers the value of the property "as-if-vacant". The fair value reflects the depreciated replacement cost of the permanent assets, with no trade fixtures included.
75
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
In allocating the purchase price to identified intangible assets and liabilities of an acquired property, the value of above-market and below-market leases is estimated based on the present value of the difference between the contractual amounts to be paid pursuant to the leases and management’s estimate of the market lease rates and other lease provisions (i.e., expense recapture, base rental changes, etc.) measured over a period equal to the estimated remaining term of the lease. The capitalized above-market or below-market intangible is amortized to rental income over the estimated remaining term of the respective leases. Mortgage debt premiums are amortized into interest expense over the remaining term of the related debt instrument. Unit discounts and premiums are amortized into Minority interest in income, net over the period from the date of issuance to the earliest redemption date of the units.
In determining the value of in-place leases, management considers current market conditions and costs to execute similar leases in arriving at an estimate of the carrying costs during the expected lease-up period from vacant to existing occupancy. In estimating carrying costs, management includes real estate taxes, insurance, other operating expenses, and estimates of lost rental revenue during the expected lease-up periods and costs to execute similar leases including leasing commissions, legal and other related costs based on current market demand. In estimating the value of tenant relationships, management considers the nature and extent of the existing tenant relationship, the expectation of lease renewals, growth prospects, and tenant credit quality, among other factors. The value assigned to in-place leases and tenant relationships is amortized over the estimated remaining term of the leases. If a lease were to be terminated prior to its scheduled expiration, all unamortized costs relating to that lease would be written off.
Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets, as follows:
Buildings and building improvements
15 to 50 years
Fixtures, leasehold and tenant improvements
Terms of leases or useful lives, whichever is shorter
(including certain identified intangible assets)
Expenditures for maintenance and repairs are charged to operations as incurred. Significant renovations and replacements, which improve and extend the life of the asset, are capitalized. The useful lives of amortizable intangible assets are evaluated each reporting period with any changes in estimated useful lives being accounted for over the revised remaining useful life.
Real Estate Under Development
Real estate under development represents both the ground-up development of neighborhood and community shopping center projects which are subsequently sold upon completion and projects which the Company may hold as long-term investments. These properties are carried at cost. The cost of land and buildings under development includes specifically identifiable costs. The capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, salaries, and related costs of personnel directly involved and other costs incurred during the period of development. The Company ceases cost capitalization when the property is held available for occupancy upon substantial completion of tenant improvements, but no later than one year from the completion of major construction activity. If, in management’s opinion, the net sales price of assets held for resale or the current and projected undiscounted cash flows of these assets to be held as long-term investments is less than the net carrying value, the carrying value would be adjusted to an amount to reflect the estimated fair value of the property.
Investments in Unconsolidated Joint Ventures
The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting as the Company exercises significant influence, but does not control these entities. These investments are recorded initially at cost and subsequently adjusted for cash contributions and distributions. Earnings for each investment are recognized in accordance with each respective investment agreement and where applicable, based upon an allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period.
76
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
The Company’s joint ventures and other real estate investments primarily consist of co-investments with institutional and other joint venture partners in neighborhood and community shopping center properties, consistent with its core business. These joint ventures typically obtain non-recourse third-party financing on their property investments, thus contractually limiting the Company’s exposure to losses to the amount of its equity investment; and due to the lender’s exposure to losses, a lender typically will require a minimum level of equity in order to mitigate its risk. The Company’s exposure to losses associated with its unconsolidated joint ventures is primarily limited to its carrying value in these investments.
On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment’s value is impaired only if management’s estimate of the fair value of the investment is less than the carrying value of the investment and such difference is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the estimated fair value of the investment.
Other Real Estate Investments
Other real estate investments primarily consist of preferred equity investments for which the Company provides capital to developers and owners of real estate. The Company typically accounts for its preferred equity investments on the equity method of accounting, whereby earnings for each investment are recognized in accordance with each respective investment agreement and based upon an allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period.
Mortgages and Other Financing Receivables
Mortgages and other financing receivables consist of loans acquired and loans originated by the Company. Loan receivables are recorded at stated principal amounts net of any discount or premium or deferred loan origination costs or fees. The related discounts or premiums on mortgages and other loans purchased are amortized or accreted over the life of the related loan receivable. The Company defers certain loan origination and commitment fees, net of certain origination costs and amortizes them as an adjustment of the loan’s yield over the term of the related loan. The Company evaluates the collectability of both interest and principal on each loan to determine whether it is impaired. A loan is considered to be impaired, when based upon current information and events, it is probable that the Company will be unable to collect all amounts due according to the existing contractual terms. When a loan is considered to be impaired, the amount of loss is calculated by comparing the recorded investment to the value determined by discounting the expected future cash flows at the loan’s effective interest rate or to the value of the underlying collateral if the loan is collateralized. Interest income on performing loans is accrued as earned. Interest income on impaired loans is recognized on a cash basis.
Cash and Cash Equivalents
Cash and cash equivalents (demand deposits in banks, commercial paper and certificates of deposit with original maturities of three months or less) includes tenants' security deposits, escrowed funds and other restricted deposits approximating $0.6 million at December 31, 2007 and 2006.
Cash and cash equivalent balances may, at a limited number of banks and financial institutions, exceed insurable amounts. The Company believes it mitigates risk by investing in or through major financial institutions. Recoverability of investments is dependent upon the performance of the issuers.
Marketable Securities
The Company classifies its existing marketable equity securities as available-for-sale in accordance with the provisions of SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities. These securities are carried at fair market value, with unrealized gains and losses reported in stockholders’ equity as a component of Accumulated other comprehensive income ("OCI"). Gains or losses on securities sold are based on the specific identification method.
77
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
All debt securities are classified as held-to-maturity because the Company has the positive intent and ability to hold the securities to maturity. Held-to-maturity securities are stated at amortized cost, adjusted for amortization of premiums and accretion of discounts to maturity.
On a periodic basis, management assesses whether there are any indicators that the value of the Company’s marketable securities may be impaired. A marketable security is impaired only if management’s estimate of fair value of the security is less than the carrying value of the security and such difference is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the security over the estimated fair value in the security.
Deferred Leasing and Financing Costs
Costs incurred in obtaining tenant leases and long-term financing, included in deferred charges and prepaid expenses in the accompanying Consolidated Balance Sheets, are amortized over the terms of the related leases or debt agreements, as applicable. Such capitalized costs include salaries and related costs of personnel directly involved in successful leasing efforts.
Revenue Recognition and Accounts Receivable
Base rental revenues from rental property are recognized on a straight-line basis over the terms of the related leases. Certain of these leases also provide for percentage rents based upon the level of sales achieved by the lessee. These percentage rents are recognized once the required sales level is achieved. Rental income may also include payments received in connection with lease termination agreements. In addition, leases typically provide for reimbursement to the Company of common area maintenance costs, real estate taxes and other operating expenses. Operating expense reimbursements are recognized as earned.
Management and other fee income consists of property management fees, leasing fees, property acquisition and disposition fees, development fees and asset management fees. These fees arise from contractual agreements with third parties or with entities in which the Company has a partial non-controlling interest. Management and other fee income, including acquisition and disposition fees, are recognized as earned under the respective agreements. Management and other fee income related to partially owned entities are recognized to the extent attributable to the unaffiliated interest.
Gains and losses from the sale of depreciated operating property and ground-up development projects are generally recognized using the full accrual method in accordance with SFAS No. 66, Accounting for Sales of Real Estate ("SFAS No. 66"), provided that various criteria relating to the terms of sale and subsequent involvement by the Company with the properties are met.
Gains and losses on transfers of operating properties result from the sale of a partial interest in properties to unconsolidated joint ventures and are recognized using the partial sale provisions of SFAS No. 66.
The Company makes estimates of the uncollectability of its accounts receivable related to base rents, expense reimbursements and other revenues. The Company analyzes accounts receivable and historical bad debt levels, customer credit worthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. In addition, tenants in bankruptcy are analyzed and estimates are made in connection with the expected recovery of pre-petition and post-petition claims. The Company’s reported net income is directly affected by management’s estimate of the collectability of accounts receivable.
Income Taxes
The Company has made an election to qualify, and believes it is operating so as to qualify, as a REIT for federal income tax purposes. Accordingly, the Company generally will not be subject to federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under Section 856 through 860 of the Code.
78
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
In connection with the RMA, which became effective January 1, 2001, the Company is permitted to participate in certain activities which it was previously precluded from in order to maintain its qualification as a REIT, so long as these activities are conducted in entities which elect to be treated as taxable subsidiaries under the Code. As such, the Company is subject to federal and state income taxes on the income from these activities.
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance for deferred tax assets for which it does not consider realization of such assets to be more likely than not.
Foreign Currency Translation and Transactions
Assets and liabilities of the Company’s foreign operations are translated using year-end exchange rates, and revenues and expenses are translated using exchange rates as determined throughout the year. Gains or losses resulting from translation are included in OCI, as a separate component of the Company’s stockholders’ equity. Gains or losses resulting from foreign currency transactions are translated to local currency at the rates of exchange prevailing at the dates of the transactions. The effect of the transaction’s gain or loss is included in the caption Other income, net in the Consolidated Statements of Income.
Derivative/Financial Instruments
The Company measures its derivative instruments at fair value and records them in the Consolidated Balance Sheet as an asset or liability, depending on the Company’s rights or obligations under the applicable derivative contract. In addition, the fair value adjustments will be recorded in either stockholders’ equity or earnings in the current period based on the designation of the derivative. The effective portions of changes in fair value of cash flow hedges are reported in OCI and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in the fair value of foreign currency hedges that are designated and effective as net investment hedges are included in the cumulative translation component of OCI to the extent they are economically effective and are subsequently reclassified to earnings when the hedged investments are sold or otherwise disposed of. The changes in fair value of derivative instruments which are not designated as hedging instruments and the ineffective portions of hedges are recorded in earnings for the current period.
The Company utilizes derivative financial instruments to reduce exposure to fluctuations in interest rates, foreign currency exchange rates and market fluctuations on equity securities. The Company has established policies and procedures for risk assessment and the approval, reporting and monitoring of derivative financial instrument activities. The Company has not entered, and does not plan to enter, into financial instruments for trading or speculative purposes. Additionally, the Company has a policy of only entering into derivative contracts with major financial institutions. The principal financial instruments used by the Company are interest rate swaps, foreign currency exchange forward contracts, cross-currency swaps and warrant contracts. These derivative instruments were designated and qualified as cash flow, fair value or foreign currency hedges (see Note 16).
Earnings Per Share
On July 21, 2005, the Company’s Board of Directors declared a two-for-one split (the "Stock Split") of the Company’s common stock which was effected in the form of a stock dividend paid on August 23, 2005, to stockholders of record on August 8, 2005. All share and per share data included in the accompanying Consolidated Financial Statements and Notes thereto have been adjusted to reflect this Stock Split.
79
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
The following table sets forth the reconciliation of earnings and the weighted average number of shares used in the calculation of basic and diluted earnings per share (amounts presented in thousands, except per share data):
2007
2006
2005
Computation of Basic Earnings Per Share:
Income from continuing operations before extraordinary gain
$ 359,226
$ 342,849
$ 322,063
Gain on transfer of operating properties, net
-
1,394
2,151
Gain on sale of operating properties, net of tax
2,708
1,066
682
Preferred stock dividends
(19,659)
(11,638)
(11,638)
Income from continuing operations before extraordinary gain applicable to common shares
342,275
333,671
313,258
Income from discontinued operations
30,631
82,950
38,732
Extraordinary gain
50,265
-
-
Net income applicable to common shares
$ 423,171
$ 416,621
$ 351,990
Weighted average common shares outstanding
252,129
239,552
226,641
Basic Earnings Per Share:
Income from continuing operations before extraordinary gain
$ 1.36
$ 1.39
$ 1.38
Income from discontinued operations
0.12
0.35
0.17
Extraordinary gain
0.20
-
-
Net income
$ 1.68
$ 1.74
$ 1.55
Computation of Diluted Earnings Per Share:
Income from continuing operations before extraordinary gain for diluted earnings per share (a)
$ 342,275
$ 333,671
$ 313,258
Income from discontinued operations
30,631
82,950
38,732
Extraordinary gain
50,265
-
-
Net income for diluted earnings per share
$ 423,171
$ 416,621
$ 351,990
Weighted average common shares outstanding – Basic
252,129
239,552
226,641
Effect of dilutive securities (a):
Stock options/deferred stock awards
4,929
5,063
4,227
Shares for diluted earnings per common share
257,058
244,615
230,868
Diluted Earnings Per Share:
Income from continuing operations before extraordinary gain
$ 1.33
$ 1.36
$ 1.36
Income from discontinued operations
0.12
0.34
0.16
Extraordinary gain
0.20
-
-
Net income
$ 1.65
$ 1.70
$ 1.52
(a)
The effect of the assumed conversion of certain convertible units had an anti-dilutive effect upon the calculation of Income from continuing operations before extraordinary gain per share. Accordingly, the impact of such conversions has not been included in the determination of diluted earnings per share calculations.
In addition, there were approximately 3,017,400, 71,250, and 2,195,400 stock options that were anti-dilutive as of December 31, 2007, 2006 and 2005, respectively.
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Stock Compensation
The Company maintains an equity participation plan (the "Plan") pursuant to which a maximum of 42,000,000 shares of Common Stock may be issued for qualified and non-qualified options and restricted stock grants. Options granted under the Plan generally vest ratably over a three year term for options granted prior to August 1, 2005 or five year term for options granted after August 1, 2005, expire ten years from the date of grant and are exercisable at the market price on the date of grant, unless otherwise determined by the Board of Directors at its sole discretion. Restricted stock grants generally vest 100% on the fifth anniversary of the grant. In addition, the Plan provides for the granting of certain options to each of the Company’s non-employee directors (the "Independent Directors") and permits such Independent Directors to elect to receive deferred stock awards in lieu of directors’ fees.
Prior to January 1, 2003, the Company accounted for the Plan under the intrinsic value-based method of accounting prescribed by Accounting Principles Board ("APB") Opinion No. 25, Accounting for Stock Issued to Employees, and related interpretations including FASB Interpretation No. 44, Accounting for Certain Transactions involving Stock Compensation (an interpretation of APB Opinion No. 25). Effective January 1, 2003, the Company adopted the prospective method provisions of SFAS No. 148, Accounting for Stock-Based Compensation – Transition and Disclosure an Amendment of FASB Statement No. 123 ("SFAS No. 148"), which applies the recognition provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation ("SFAS No. 123") to all employee awards granted, modified or settled after January 1, 2003.
During December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based Payment" ("SFAS No. 123(R)"), which is a revision of Statement 123. SFAS No. 123(R) supersedes Opinion 25. Generally, the approach in SFAS No. 123(R) is similar to the approach described in Statement 123. However, SFAS No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the statement of operations based on their fair values. Pro-forma disclosure is no longer an alternative under SFAS No. 123(R). SFAS No. 123(R) was effective for fiscal years beginning after December 31, 2005. The Company began expensing stock based employee compensation with its adoption of the prospective method provisions of SFAS No. 148, effective January 1, 2003, as a result, the adoption of SFAS No. 123(R) did not have a material impact on the Company’s financial position or results of operations.
The non-cash expense related to stock-based employee compensation included in the determination of net income is less than that which would have been recognized if the fair value based method had been applied to all awards since the original effective date of SFAS No. 123. There was no difference in amounts for the years ended December 31, 2007 or 2006. The following table illustrates the effect on net income and earnings per share if the fair value based method had been applied to all outstanding stock awards in 2005 (amounts presented in thousands, except per share data):
2005
Net income, as reported
$ 363,628
Add: Stock based employee compensation
expense included in reported net income
4,608
Deduct: Total stock based employee
compensation expense determined under fair value
based method for all awards
(5,206)
Pro Forma Net Income – Basic
$ 363,030
Earnings Per Share
Basic – as reported
$ 1.55
Basic – pro forma
$ 1.55
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Net income for diluted earnings per share
$ 351,990
Add: Stock based employee compensation
expense included in reported net income
4,608
Deduct: Total stock based employee
compensation expense determined under fair value
based method for all awards
(5,206)
Pro Forma Net Income – Diluted
$ 351,392
Earnings Per Share
Diluted – as reported
$ 1.52
Diluted – pro forma
$ 1.52
The pro forma adjustments to net income and net income per diluted common share assume fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing formula. The more significant assumptions underlying the determination of such fair values for options granted during the year ended December 2005 were as follows:
2005
Weighted average fair value of options granted
$3.21
Weighted average risk-free interest rates
4.03%
Weighted average expected option lives
4.80
Weighted average expected volatility
18.01%
Weighted average expected dividend yield
5.30%
New Accounting Pronouncements
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurement ("SFAS No. 157"), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurement. This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007. During February 2008, the FASB issued a Staff Position that will (i) partially defer the effective date of SFAS No. 157, for one year for certain nonfinancial assets and nonfinancial liabilities and (ii) remove certain leasing transactions from the scope of SFAS No. 157. The impact of adopting SFAS No. 157 is not expected to have a material impact on the Company’s financial position or results of operations.
In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities ("SFAS No. 159"). SFAS No. 159 permits entities to choose to measure many financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS No. 159 is effective for fiscal years beginning after November 15, 2007. The impact of adopting SFAS No. 159 is not expected to have a material impact on the Company’s financial position or results of operations.
In June 2007, the AICPA issued Statement of Position 07-1, Clarification of the Scope of the Audit and Accounting Guide for Investment Companies and Accounting by Parent Companies and Equity Method Investors for Investments in Investment Companies ("SOP 07-1"). SOP 07-1 sets forth more stringent criteria for qualifying as an investment company than does the predecessor Audit Guide. In addition, SOP 07-1 establishes new criteria for a parent company or equity method investor to retain investment company accounting in their consolidated financial statements. Investment companies record all their investments at fair value with changes in value reflected in earnings. SOP 07-1 was to be effective for the Company’s 2008 fiscal year, however, in October 2007 the FASB agreed to propose an indefinite delay and in February 2008, the FASB issued a final Staff Position to indefinitely delay the effective date of SOP 07-1.
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
In December 2007, the FASB issued SFAS No. 141 (revised 2007), Business Combinations ("SFAS No. 141(R)"). The objective of this statement is to improve the relevance, representation, faithfulness, and comparability of the information that a reporting entity provides in its financial reports about a business combination and its effects. To accomplish that, this Statement establishes principles and requirements for how the acquirer: (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree, (ii) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase and (iii) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This statement applies prospectively to business combinations for which the acquisition date is on or after the first annual reporting period beginning on or after December 15, 2008. An entity may not apply it before that date. The Company is currently assessing the impact the adoption of SFAS No 141(R) would have on the Company’s financial position and results of operations.
In December 2007, the FASB issued SFAS No. 160, Non-Controlling Interest in Consolidated Financial Statements in Amendment of ARB No. 51 ("SFAS No. 160"). A non-controlling interest, sometimes called a minority interest, is the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. The objective of this statement is to improve the relevance, comparability, and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards that require: (i) the ownership interest in subsidiaries held by parties other than the parent be clearly identified, labeled, and presented in the consolidated statement of financial position within equity, but separate from the parent’s equity, (ii) the amount of consolidated net income attributable to the parent and to the non-controlling interest be clearly identified and presented on the face of the consolidated statement of income, (iii) changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary be accounted for consistently and requires that they be accounted for similarly, as equity transactions, (iv) when a subsidiary is deconsolidated, any retained non-controlling equity investment in the former subsidiary be initially measured at fair value, the gain or loss on the deconsolidation of the subsidiary is measured using the fair value of any non-controlling equity investment rather than the carrying amount of that retained investment, and (v) entities provide sufficient disclosures that clearly identity and distinguish between the interest of the parent and the interest of the non-controlling owners. This statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Earlier adoption is prohibited. The Company is currently assessing the impact the adoption of SFAS No. 160 would have on the Company’s financial position and results of operations.
Reclassification
Certain reclassification of prior years’ amounts have been made to conform with the current year presentation.
2. Real Estate:
The Company’s components of Rental property consist of the following (in thousands):
December 31,
2007
2006
Land
$ 1,262,879
$ 978,819
Buildings and improvements
Buildings
3,559,464
2,980,369
Building improvements
566,720
301,584
Tenant improvements
549,490
528,479
Fixtures and leasehold improvements
33,932
22,216
Other rental property (1)
208,144
151,870
6,180,629
4,963,337
Accumulated depreciation and amortization
(977,444)
(806,670)
Total
$ 5,203,185
$ 4,156,667
83
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
(1)
At December 31, 2007 and 2006, Other rental property consisted of intangible assets including $130,598 and $88,328 respectively, of in-place leases, $21,555 and $15,705 respectively, of tenant relationships, and $55,991 and $47,837 respectively, of above-market leases.
In addition, at December 31, 2007 and 2006, the Company had intangible liabilities relating to below-market leases from property acquisitions of approximately $182.3 million and $120.6 million, respectively. These amounts are included in the caption Other liabilities in the Company’s Consolidated Balance Sheets.
3. Property Acquisitions, Developments and Other Investments:
Operating property acquisitions, ground-up development costs and other investments have been funded principally through the application of proceeds from the Company's public equity and unsecured debt issuances, proceeds from mortgage and construction financings, availability under the Company’s revolving lines of credit and issuance of various partnership units.
Operating Properties
Acquisition of Operating Properties -
During the year ended December 31, 2007, the Company acquired, in separate transactions, 61 operating properties, comprising an aggregate 4.4 million square feet of GLA, for an aggregate purchase price of approximately $1.1 billion including the assumption of approximately $114.3 million of non-recourse mortgage debt encumbering nine of the properties. Details of these transactions are as follows (in thousands):
Purchase Price
Property Name
Location
Month Acquired
Cash
Debt Assumed
Total
GLA
U.S. acquisitions:
3 Properties
Various
Jan-07 (1)
$ 22,535
$19,480
$ 42,015
240
Embry Village
Atlanta, GA
Feb-07
46,800
-
46,800
215
Park Place
Morrisville, NC
Mar-07 (2)
10,700
10,700
21,400
170
35 North Third Street
Philadelphia, PA
Mar-07
2,100
-
2,100
2
Cranberry Commons II
Pittsburgh, PA
Mar-07 (3)
1,431
3,108
4,539
17
Lake Grove
Lake Grove, NY
Apr-07 (4)
31,500
-
31,500
158
1628 Walnut St
Philadelphia, PA
Apr-07
3,500
-
3,500
2
2 Properties
Various
Apr-07 (5)
62,800
-
62,800
436
Flagler Park
Miami, FL
Apr-07
95,000
-
95,000
350
2 Properties
Various
May-07 (6)
36,801
16,800
53,601
169
Suburban Square
Ardmore, PA
May-07
215,000
-
215,000
359
1701 Walnut St
Philadelphia, PA
May-07
12,000
-
12,000
15
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
30 West 21st St
New York, NY
May-07
6,250
18,750
�� 25,000
5
Chatham Plaza
Savannah, GA
June-07
44,600
-
44,600
199
2 Properties
Various
June-07 (7)
16,920
-
16,920
22
Birchwood Portfolio (11 Properties)
Long Island, NY
July-07
92,090
-
92,090
280
493-497 Commonwealth Ave
Boston, MA
July-07
5,650
-
5,650
20
3 Properties
Philadelphia, PA
July-07 (8)
60,890
-
60,890
68
Highlands Square
Clearwater, FL
July-07(9)
4,531
-
4,531
76
Mooresville Crossings
Mooresville, NC
Aug-07
41,000
-
41,000
155
Corona Hills Marketplace
Corona, CA
Aug-07
32,000
-
32,000
149
127-129 Newbury St
Boston, MA
Oct-07
11,600
-
11,600
9
Talavi
Glendale, AZ
Nov-07 (10)
12,500
-
12,500
109
Wayne Plaza
Chambersburg, PA
Nov-07 (2)
6,849
14,289
21,138
132
Rockford Crossing
Rockford, IL
Dec-07 (2)
3,867
11,033
14,900
89
Center at Westbank
Harvey, LA
Dec-07 (2)
11,551
20,149
31,700
182
890,465
114,309
1,004,774
3,628
Mexican Acquisitions:
Waldo’s Mexico Portfolio (17 properties)
Various, Mexico
Mar-07
51,500
-
51,500
488
Gran Plaza Cancun
Mexico
Dec-07
38,909
-
38,909
273
$980,874
$114,309
$1,095,183
4,389
(1)
Three properties acquired in separate transactions, located in Alpharetta, GA, Southlake, TX and Apopka, FL.
(2)
The Company acquired these properties from a joint venture in which the Company holds a 20% non-controlling interest.
(3)
The Company acquired this property from a venture in which the Company had a preferred equity investment.
(4)
The Company provided a $31.0 million preferred equity investment to a newly formed joint venture in which the Company has a 98% economic interest for the acquisition of this operating property and has determined under the provisions of FIN 46(R) that this joint venture is a VIE and that the Company is the primary beneficiary. As such, the Company has consolidated this entity for accounting and reporting purposes.
(5)
The Company acquired, in separate transactions, these two properties located in Chico, CA and Auburn, WA from a joint venture in which the Company holds a 15% non-controlling interest.
(6)
Two properties acquired in separate transactions, located in Sparks, NV and San Diego, CA.
(7)
Two properties acquired in separate transactions, located in Boston, MA and Philadelphia, PA.
(8)
Three mixed use residential/retail properties acquired in separate transactions, located in Philadelphia, PA.
(9)
The Company provided a $4.3 million preferred equity investment to a newly formed joint venture in which the Company has a 94% economic interest for the acquisition of this operating property and has determined under the provisions of FIN 46(R) that this joint venture is a VIE and that the Company is the primary beneficiary. As such, the Company has consolidated this entity for accounting and reporting purposes.
(10)
The Company acquired an additional 50% ownership interest in this operating property, as such the Company now holds a 100% interest in this property and consolidates it for financial reporting purposes.
85
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2006, the Company acquired, in separate transactions, 40 operating properties, comprising an aggregate 4.8 million square feet of GLA, for an aggregate purchase price of approximately $1.1 billion, including the assumption of approximately $297.7 million of non-recourse mortgage debt encumbering 20 of the properties, issuance of approximately $247.6 million of redeemable units relating to 10 properties and issuance of approximately $51.5 million of Common Stock relating to one property. Details of these transactions are as follows (in thousands):
Purchase Price
Property Name
Location
Month Acquired
Cash
Debt Assumed/ Stock or Units Issued
Total
GLA
Portfolio – 19 properties
Various: CA, NV, & HI
Jan-06
$114,430
$ 19,124
$ 133,554
815
Groves at Lakeland
Lakeland, FL
Feb-06
1,500
-
1,500
105
625 Broadway
New York, NY
Feb-06
36,600
27,750
64,350
83
387 Bleecker Street
New York, NY
Feb-06
3,700
2,960
6,660
-
Cupertino Village
Cupertino, CA
Mar-06
27,400
38,000
65,400
115
Poway Center
Poway, CA
Mar-06 (1)
3,500
-
3,500
16
Plaza Centro
Caguas, PR
Mar-06
35,731
71,774(2)
107,505
438
Los Colobos
Carolina, PR
Mar-06
36,684
41,719(2)
78,403
343
Hylan Plaza
Staten Island, NY
Mar-06
-
81,800(3)
81,800
358
Tyler St Plaza
Riverside, CA
Apr-06
10,100
-
10,100
86
Market at Bay Shore
Bay Shore, NY
Apr-06
-
39,673(2)
39,673
177
Pathmark S.C.
Centereach, NY
Apr-06
-
21,955(2)
21,955
102
Western Plaza
Mayaguez, PR
June-06
4,562
30,378(2)
34,940
226
Mallside Plaza
Portland, ME
June-06
23,100
-
23,100
91
Pearl Towers
Albany, NY
June-06
-
39,868(2)
39,868
253
19 Greenwich
New York, NY
Sept-06
1,010
4,040
5,050
-
Western Plaza
Mayaguez, PR
Sept-06
1,900
19,443(2)
21,343
126
Los Colobos
Carolina, PR
Sept-06
2,034
24,414(2)
26,448
228
Plaza Centro
Caguas, PR
Sept-06
16,165
9,185(2)
25,350
139
Trujillo Alto Plaza
Trujillo Alto, PR
Sept-06
7,379
26,058(2)
33,437
201
Ponce Town Center
Ponce, PR
Oct-06
3,679
38,974(2)
42,653
193
Villa Maria S.C.
Manati, PR
Oct-06
1,382
6,825(2)
8,207
70
100 Van Dam Street
New York, NY
Oct-06
3,650
16,400
20,050
-
Rexville Town Center
Bayamon, PR
Nov-06
6,813
66,766(2)
73,579
186
Fountains at Arbor Lakes
Maple Grove, MN
Dec-06
95,025
-
95,025
407
$436,344
$627,106
$1,063,450
4,758
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
(1) Acquired additional square footage of existing property.
(2) Represents the value of units issued and/or debt assumed, see additional disclosure below.
(3) Represents the value of Common Stock issued by the Company relating to the merger transaction with Atlantic Realty, including $30.3 million issued to the Company’s subsidiaries representing the 37% of Atlantic Realty previously owned (See Note 17 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K).
Included in the 2006 acquisitions above is the acquisition of interests in seven shopping center properties, located in Caguas, Carolina, Mayaguez, Trujillo Alto, Ponce, Manati, and Bayamon, Puerto Rico, valued at an aggregate $451.9 million. The properties were acquired through the issuance of units from a consolidated subsidiary and consist of approximately $158.6 million of floating and fixed-rate redeemable units, approximately $45.8 million of redeemable units, which are redeemable at the option of the holder, the assumption of approximately $131.2 million of non-recourse mortgage debt encumbering six of the properties and approximately $116.3 million in cash. The Company has the option to settle the redemption of the $45.8 million redeemable units with Common Stock or cash. During 2007, the holders of the $45.8 million in redeemable units, redeemed $26.3 million of such units. The Company opted to settle these units in cash. Additionally, during 2007, $3.0 million of the $158.6 million in floating and fixed rate redeemable units were redeemed by the holders. The aggregate remaining value of the units is included in Minority interests on the Company’s Consolidated Balance Sheets.
During April 2006, the Company acquired interests in two shopping center properties, included in the table above, located in Bay Shore and Centereach, NY, valued at an aggregate $61.6 million. The properties were acquired through the issuance of units from a consolidated subsidiary and consist of approximately $24.2 million of redeemable units, which are redeemable at the option of the holder, approximately $14.0 million of fixed-rate redeemable units and the assumption of approximately $23.4 million of non-recourse mortgage debt. The Company has the option to settle the redemption of the $24.2 million redeemable units with Common Stock or cash. During 2007, $1.1 million of the $24.2 million in redeemable units were redeemed by the holder in cash at the option of the Company. The aggregate remaining value of the units is included in Minority interests on the Company’s Consolidated Balance Sheets.
During June 2006, the Company acquired an interest in an office property, included in the table above, located in Albany, NY, valued at approximately $39.9 million. The property was acquired through the issuance of approximately $5.0 million of redeemable units from a consolidated subsidiary, which are redeemable at the option of the holder after one year, and the assumption of approximately $34.9 million of non-recourse mortgage debt. The Company has the option to settle the redemption of the redeemable units with Common Stock or cash. The aggregate value of the units is included in Minority interests on the Company’s Consolidated Balance Sheets.
The aggregate purchase price of the above mentioned 2007 and 2006 properties have been allocated to the tangible and intangible assets and liabilities of the properties in accordance with SFAS No. 141, at the date of acquisition, based on evaluation of information and estimates available at such date. As final information regarding the fair value of the assets acquired and liabilities assumed is received and estimates are refined, appropriate adjustments will be made to the purchase price allocation. The allocations are finalized no later than twelve months from the acquisition date. The total aggregate purchase price was allocated as follows:
2007
2006
Land
$327,970
$335,224
Buildings
623,311
410,146
Below Market Rents
(62,802)
(38,681)
Above Market Rents
13,629
35,293
In-Place Leases
41,281
73,847
Other Intangibles
10,181
7,215
Building Improvements
105,716
84,405
Tenant Improvements
35,897
156,001
$1,095,183
$1,063,45
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Ground-Up Development -
The Company is engaged in ground-up development projects which consists of (i) merchant building through the Company’s wholly-owned taxable REIT subsidiaries, which develop neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) U.S. ground-up development projects which will be held as long-term investments by the Company and (iii) various ground-up development projects located in Mexico for long-term investment. The ground-up development projects generally have significant pre-leasing prior to the commencement of construction. As of December 31, 2007, the Company had in progress a total of 60 ground-up development projects including 27 merchant building projects, nine U.S. ground-up development projects, and 24 ground-up development projects located throughout Mexico.
Merchant Building -
During the years 2007, 2006 and 2005, the Company expended approximately $269.6 million, $287.0 million and $385.3 million, respectively, in connection with the purchase of land and construction costs related to its merchant building projects. These costs have been funded principally through proceeds from sales of completed projects and construction loans.
Long-term Ground-up Development -
During 2007, the Company expended approximately $7.7 million in connection with the purchase of undeveloped land in Union, NJ, which will be developed into a 0.2 million square foot retail center and approximately $21.5 million in connection with the purchase of three redevelopment properties located in Bronx, NY, which will be redeveloped into mixed-use residential/retail centers aggregating 0.1 million square feet. These projects have a total estimated project cost of approximately $71.5 million.
During 2007, the Company acquired, in separate transactions, nine land parcels located in various cities throughout Mexico, for an aggregate purchase price of approximately MXP 1.1 billion (approximately USD $94.8 million). Seven of these land parcels will be developed into retail centers aggregating approximately 2.8 million square feet of GLA with a total estimated aggregate project cost of approximately MXP 2.3 billion (approximately USD $210.2 million).
During 2007, the Company acquired, through a newly formed joint venture in which the Company has a controlling ownership interest, a 0.3 million square foot development project in Neuvo Vallarta, Mexico, for a purchase price of approximately MXP 119.5 million (approximately USD $11.0 million). Total estimated project costs are approximately USD $28.3 million.
During 2007, the Company acquired, through a newly formed joint venture in which the Company has a non-controlling interest, a 0.1 million square foot development project in Tuxtepec, Mexico, for a purchase price of MXP 48.6 million (approximately USD $4.4 million). Total estimated project costs are approximately USD $14.4 million.
During 2006, the Company acquired land in Chambersburg, PA and Anchorage, AK for an aggregate purchase price of approximately $12.2 million. The properties will be developed into retail centers with approximately 0.7 million square feet of GLA with total estimated project costs of approximately $62.7 million.
During June 2006, the Company acquired, through a newly formed joint venture in which the Company has a non-controlling interest, a 0.1 million square foot development project in Puerta Vallarta, Mexico, for a purchase price of MXP 65.4 million (approximately USD $5.7 million). Total estimated project costs are approximately USD $7.3 million.
88
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2006, the Company acquired, in separate transactions, nine parcels of land located in various cities throughout Mexico, for an aggregate purchase price of approximately MXP 1.3 billion (approximately USD $119.3 million). The properties were at various stages of construction at acquisition and will be developed into retail centers aggregating approximately 3.4 million square feet. Total estimated remaining project costs are approximately USD $312.4 million.
Kimsouth -
During November 2002, the Company through its taxable REIT subsidiary, together with Prometheus Southeast Retail Trust, completed the merger and privatization of Konover Property Trust, which has been renamed Kimsouth Realty, Inc. ("Kimsouth"). In connection with the merger, the Company acquired 44.5% of the common stock of Kimsouth, which consisted primarily of 38 retail shopping center properties comprising approximately 4.6 million square feet of GLA. Total acquisition value was approximately $280.9 million including approximately $216.2 million in mortgage debt. The Company’s investment strategy with respect to Kimsouth included re-tenanting, repositioning and disposition of the properties. As of January 1, 2006, Kimsouth consisted of five properties.
During 2006, Kimsouth sold two properties for an aggregate sales price of approximately $9.8 million and transferred two properties to a joint venture in which the Company has an 18% non-controlling interest for an aggregate price of approximately $54.0 million, which included the repayment of approximately $23.1 million in mortgage debt.
During May 2006, the Company acquired an additional 48% interest in Kimsouth for approximately $22.9 million, which increased the Company’s total ownership to 92.5%. As a result of this transaction, the Company became the controlling shareholder and had therefore, commenced consolidation of Kimsouth upon the closing date. The acquisition of the additional 48% ownership interest has been accounted for as a step acquisition with the purchase price being allocated to the identified assets and liabilities of Kimsouth.
As of May 2006, Kimsouth had approximately $133.0 million of net operating loss carry-forwards ("NOLs"), which may be utilized to offset future taxable income of Kimsouth. The Company evaluated the need for a valuation allowance based on projected taxable income and determined that a valuation allowance of approximately $34.2 million was required. As such, a purchase price adjustment of $17.5 million was recorded (See Note 22 for additional information).
During June 2006, Kimsouth contributed approximately $51.0 million, of which $47.2 million or 92.5% was provided by the Company, to fund its 15% non-controlling interest in a newly formed joint venture with an investment group to acquire a portion of Albertson’s Inc. To maximize investment returns, the investment group’s strategy with respect to this joint venture, includes refinancing, selling selected stores and the enhancement of operations at the remaining stores. Kimsouth accounts for this investment under the equity method of accounting. During the year ended December 31, 2007, this joint venture completed the disposition of certain operating stores and a refinancing of the remaining assets in the joint venture. As a result of these transactions Kimsouth received cash distributions of approximately $148.6 million. Kimsouth has a remaining capital commitment obligation to fund up to an additional $15.0 million for general purposes. Due to this remaining capital commitment, $15.0 million is included in Other liabilities in the Company’s Consolidated Balance Sheets.
During the year ended December 31, 2007, Kimsouth’s income from the Albertson’s joint venture aggregated approximately $49.6 million, net of income tax. This amount includes (i) an operating loss of approximately $15.1 million, net of an income tax benefit of approximately $10.1 million, (ii) distribution in excess of Kimsouth’s investment of approximately $10.4 million, net of income tax expense of approximately $6.9 million, and (iii) an extraordinary gain of approximately $54.3 million, net of income tax expense of approximately $36.2 million, resulting from purchase price allocation adjustments as determined in accordance with SFAS No. 141. In accordance with Accounting Principles Board Opinion 18, The Equity Method of Accounting for Investments in Common Stock, the Company has classified its 15% share of the extraordinary gain, net of income taxes, as a separate component on the Company’s Consolidated Statements of Income.
89
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2007, Kimsouth sold its remaining property for an aggregate sales price of approximately $9.1 million. This sale resulted in a gain of approximately $7.9 million, net of income taxes.
As a result of the Albertson’s transaction and the property sale described above, the Company has reduced the valuation allowance that was applied against the Kimsouth NOLs resulting in an income tax benefit of approximately $31.2 million. At December 31, 2007, Kimsouth has deferred tax assets of approximately $14.8 million representing the tax effect of approximately $37.9 million of NOLs that expire from 2021 to 2023. The Company believes that it is more likely than not that a net deferred tax asset of approximately $11.7 million will be realized on future tax returns, primarily from the generation of future taxable income and therefore, a valuation allowance of $3.1 million has been established for a portion of these deferred tax assets.
During 2007, the Albertson’s joint venture acquired two operating properties for approximately $20.3 million, including the assumption of $18.5 million in non-recourse mortgage debt.
During July 2006, Kimsouth contributed approximately $3.7 million to fund its 15% non-controlling interest in a newly formed joint venture with an investment group to acquire 50 grocery anchored operating properties. During September 2006, Kimsouth contributed an additional $2.2 million to this joint venture to acquire an operating property in Sacramento, CA, comprising approximately 0.1 million square feet of GLA, for a purchase price of approximately $14.5 million. This joint venture investment is included in Investment and advances in real estate joint ventures in the Consolidated Balance Sheets.
4. Dispositions of Real Estate:
Operating Real Estate -
During 2007, the Company (i) disposed of six operating properties and completed partial sales of three operating properties, in separate transactions, for an aggregate sales price of approximately $40.0 million, which resulted in an aggregate net gain of approximately $6.4 million, after income tax of approximately $1.6 million, and (ii) transferred one operating property, which was acquired in the first quarter of 2007, to a joint venture in which the Company holds a 15% non-controlling ownership interest for an aggregate price of approximately $4.5 million, which represented the net book value.
During 2007, FNC Realty Corporation, a consolidated entity in which the Company holds a 53% controlling ownership interest, disposed of, in separate transactions, seven properties and completed the partial sale of an additional property for an aggregate sales price of $10.4 million. These transactions resulted in pre-tax profits of approximately $4.7 million, before minority interest of $3.3 million. This income has been recorded as Income from other real estate investments in the Company’s Consolidated Statements of Income.
Additionally, during 2007, two consolidated joint ventures in which the Company had preferred equity investments disposed of, in separate transactions, their respective properties for an aggregate sales price of approximately $66.5 million. As a result of these capital transactions, the Company received approximately $22.1 million of profit participation, before minority interest of approximately $5.6 million. This profit participation has been recorded as income from other real estate investments and is reflected in Income from discontinued operating properties in the Company’s Consolidated Statements of Income.
During 2006, the Company disposed of (i) 28 operating properties and one ground lease for an aggregate sales price of approximately $270.5 million, which resulted in an aggregate net gain of approximately $71.7 million, net of income taxes of $2.8 million relating to the sale of two properties, and (ii) transferred five operating properties, to joint ventures in which the Company has 20% non-controlling interests for an aggregate price of approximately $95.4 million, which resulted in a gain of approximately $1.4 million from one transferred property.
During November 2006, the Company disposed of a vacant land parcel located in Bel Air, MD, for approximately $1.8 million resulting in a $1.6 million gain on sale. This gain is included in Other income (expense), net on the Company’s Consolidated Statements of Income.
90
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2005, the Company (i) disposed of, in separate transactions, 20 operating properties for an aggregate sales price of approximately $93.3 million, (ii) transferred three operating properties to KROP, as defined below, for an aggregate price of approximately $49.0 million and (iii) transferred 52 operating properties to various joint ventures in which the Company has non-controlling interests ranging from 15% to 50% for an aggregate price of approximately $183.1 million. For the year ended December 31, 2005, these transactions resulted in gains of approximately $31.9 million and a loss on sale/transfer from four of the properties of approximately $5.2 million.
During June 2005, the Company disposed of a vacant land parcel located in New Ridge, MD, for approximately $5.6 million resulting in a $4.6 million gain on sale. This gain is included in Other income (expense), net on the Company’s Consolidated Statements of Income.
Merchant Building - -
During 2007, the Company sold, in separate transactions, (i) four of its recently completed merchant building projects, (ii) 26 out-parcels, (iii) 74.3 acres of undeveloped land, and (iv) completed partial sales of two projects, for an aggregate total proceeds of approximately $310.5 million and received approximately $3.3 million of proceeds from completed earn-out requirements on previously sold projects. These sales resulted in pre-tax gains of approximately $40.1 million.
During 2006, the Company sold, in separate transactions, six of its recently completed projects, its partnership interest in one project and 30 out-parcels for approximately $260.0 million. These sales resulted in pre-tax gains of approximately $37.3 million.
During 2005, the Company sold, in separate transactions, six of its recently completed projects and 41 out-parcels for approximately $264.1 million. These sales resulted in pre-tax gains of approximately $33.6 million.
5. Adjustment of Property Carrying Values:
As part of the Company’s ongoing analysis of its merchant building projects, the Company has determined that for two of its projects, located in Jacksonville, FL and Anchorage, AK, the recoverable value will not exceed their estimated cost. This is primarily due to adverse changes in local market conditions and the uncertainty of those conditions in the future. As a result, the Company has recorded an aggregate pre-tax adjustment of property carrying value on these projects for the year ended December 31, 2007, of $8.5 million, representing the excess of the carrying values of the projects over their estimated fair values.
6. Discontinued Operations and Assets Held for Sale:
The Company reports as discontinued operations assets held-for-sale as of the end of the current period and assets sold during the period. All results of these discontinued operations are included in a separate component of income on the Consolidated Statements of Income under the caption Discontinued operations. This has resulted in certain reclassifications of 2007, 2006, and 2005 financial statement amounts.
The components of Income from discontinued operations for each of the three years in the period ended December 31, 2007, are shown below. These include the results of operations through the date of each respective sale for properties sold during 2007, 2006, and 2005 and a full year of operations for those assets classified as held-for-sale as of December 31, 2007 (in thousands):
91
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
2007
2006
2005
Discontinued operations:
Revenues from rental property
$ 4,449
$ 21,651
$ 31,746
Rental property expenses
(1,794)
(5,369)
(9,381)
Depreciation and amortization
(1,620)
(5,503)
(7,525)
Interest expense
(9)
(2,590)
(1,851)
Income from other real estate investments
34,740
3,705
1,192
Other (expense)/income
(2,993)
2,020
1,304
Income from discontinued operating properties
32,773
13,914
15,485
Provision for income taxes
-
(2,096)
-
Minority interest in income
(5,848)
(1,585)
(573)
Loss on operating properties held for sale/sold
(1,832)
(1,421)
(5,098)
Gain on disposition of operating properties
5,538
74,138
28,918
Income from discontinued operations
$ 30,631
$ 82,950
$ 38,732
During 2007, the Company classified as held-for-sale ten shopping center properties comprising approximately 0.6 million square feet of GLA. The book value of each of these properties, aggregating approximately $80.7 million, net of accumulated depreciation of approximately $4.9 million, did not exceed each of their estimated fair values. As a result, no adjustment of property carrying value has been recorded. The Company’s determination of the fair value for each of these properties, aggregating approximately $116.8 million, is based primarily upon executed contracts of sale with third parties less estimated selling costs. During 2007, the Company completed the sale of five of these properties and reclassified one property as held-for-use.
During 2006, the Company reclassified as held-for-sale 13 operating properties comprising 0.8 million square feet of GLA. The aggregate book value of these properties was approximately $36.5 million, net of accumulated depreciation of approximately $5.9 million. The book value of one property exceeded its estimated fair value by approximately $0.6 million, and, as a result, the Company recorded a loss resulting from an adjustment of property carrying value of approximately $0.6 million. The remaining properties had fair values exceeding their book values, and, as a result, no adjustment of property carrying value was recorded. The Company’s determination of the fair value for each of these properties, aggregating approximately $50.0 million, is based primarily upon executed contracts of sale with third parties less estimated selling costs. The Company completed the sale of these operating properties during 2006 and 2007.
During 2005, the Company reclassified as held-for-sale four operating properties comprising approximately 0.6 million square feet of GLA. The book value of each of these properties, aggregating approximately $42.2 million, net of accumulated depreciation of approximately $9.4 million, did not exceed each of their estimated fair values. As a result, no adjustment of property carrying value was recorded. The Company’s determination of the fair value for each of these properties, aggregating approximately $61.4 million, was based upon executed contracts of sale with third parties less estimated selling costs. The Company completed the sale of these properties during 2005 and 2006.
7. Investment and Advances in Real Estate Joint Ventures:
Kimco Prudential Joint Ventures ("KimPru") -
On July 9, 2006, the Company entered into a definitive merger agreement with Pan Pacific Retail Properties Inc. ("Pan Pacific"), which closed on October 31, 2006. Under the terms of the agreement, the Company
92
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
agreed to acquire all of the outstanding shares of Pan Pacific for total merger consideration of $70.00 per share. As permitted under the merger agreement, the Company elected to issue $10.00 per share of the total merger consideration in the form of Common Stock to be based upon the average closing price of the Common Stock over ten trading days immediately preceding the closing date. Within a day of the merger, the Company commenced its planned joint venture agreements with Prudential Real Estate Investors ("PREI") through three separate accounts managed by PREI, whereby, PREI contributed approximately $1.1 billion. In accordance with the joint venture agreements, all Pan Pacific assets and the respective debt were transferred to the separate accounts. There was no difference between the Company’s basis in the assets contributed and the amount of the equity the Company was credited with in the separate accounts. The Company holds 15% non-controlling ownership interests in each of these joint ventures and accounts for these investments under the equity method of accounting.
On September 25, 2006, Pan Pacific stockholders approved the proposed merger and the closing occurred on October 31, 2006. In addition to the merger consideration of $70.00 per share, Pan Pacific stockholders also received $0.2365 per share as a pro-rata portion of Pan Pacific’s regular $0.64 per share dividend for each day between September 26, 2006 and the closing date.
The transaction had a total value of approximately $4.1 billion, including Pan Pacific’s outstanding debt totaling approximately $1.1 billion. As of October 31, 2006, Pan Pacific owned interests in 138 operating properties, which comprised approximately 19.9 million square feet of GLA, located primarily in California, Oregon, Washington, and Nevada.
Funding for this transaction was provided by approximately $1.3 billion of new individual non-recourse mortgage loans encumbering 51 properties, a $1.2 billion two-year credit facility, which bore interest at LIBOR plus 0.375% in the first year, and is currently at LIBOR plus 0.45% provided by a consortium of banks and guaranteed by the joint venture partners and the Company, the issuance of 9,185,847 shares of Common Stock valued at approximately $407.7 million, the assumption of approximately $630.0 million of unsecured bonds and approximately $289.4 million of existing non-recourse mortgage debt encumbering 23 properties and approximately $300.0 million in cash. With respect to the guarantee by the Company, PREI guaranteed reimbursement to the Company of 85% of any guaranty payment the Company is obligated to make.
As of December 31, 2007 the above mentioned mortgages bear interest at rates ranging from 4.92% to 8.30% and have maturities ranging from 15 months to 106 months.
The following reconciliation describes the sources and uses of funds related to the acquisition of Pan Pacific, the commencement of the Company’s joint venture agreements with PREI, and provides a reconciliation of the Company’s aggregate initial investment in the three joint ventures of approximately $194.8 million (in millions):
Total Purchase Price
$ 4,100.0
Less:
New individual non-recourse mortgage loans
(1,300.0)
Two-year credit facility
(1,200.0)
Assumed mortgages
(289.4)
Amount to be funded
$ 1,310.6
Funding Provided:
Company Common Stock issued
$ 407.7
Pan Pacific bonds assumed by the Company
630.0
Cash
272.9
Amount funded
$ 1,310.6
Reconciliation of the Company’s Investment:
Company Common Stock issued
$ 407.7
Pan Pacific bonds assumed by the Company
630.0
Acquisition costs
1.8
1,039.5
Less:
Cash proceeds to the Company from PREI’s
contribution into the joint ventures
(844.7)
Company’s initial investment
$ 194.8
93
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2007, KimPru sold, in separate transactions, 27 operating properties, two of which were sold to the Company and one development property in separate transactions, for an aggregate sales price of approximately $517.0 million. These sales resulted in an aggregate loss of approximately $2.8 million, of which the Company’s share was approximately $0.4 million.
Proceeds from property sales were used to repay a portion of the outstanding balance on the $1.2 billion credit facility. As of December 31, 2007, there was $702.5 million outstanding under this credit facility, which currently bears interest at LIBOR plus 45.0 bps and is scheduled to mature in October 2008.
During November 2006, KimPru sold an operating property for a sales price of $5.3 million. There was no gain or loss recognized in connection with this sale.
Additionally, during January 2007, the Company and PREI entered into a new joint venture in which the Company holds a 15% non-controlling interest, which acquired 16 operating properties, aggregating 3.3 million square feet of GLA, for an aggregate purchase price of approximately $822.5 million, including the assumption of approximately $487.0 million in non-recourse mortgage debt. Six of these properties were transferred from a joint venture in which the Company held a 5% non-controlling ownership interest. One of the properties was transferred from a joint venture in which the Company held a 30% non-controlling ownership interest. As a result of this transaction, the Company recognized profit participation of approximately $3.7 million and recognized its share of the gain. The Company will manage these properties and accounts for its investment in this joint venture under the equity method of accounting.
As of December 31, 2007, the KimPru portfolio was comprised of 127 shopping center properties aggregating approximately 19.8 million square feet of GLA located in 6 states.
Kimco Income REIT ("KIR") -
The Company has a non-controlling limited partnership interest in KIR and manages the portfolio. Effective July 1, 2006, the Company acquired an additional 1.7% limited partnership interest in KIR, which increased the Company’s total non-controlling interest to approximately 45.0%.
During 2007, KIR disposed of three operating properties, in separate transactions, for an aggregate sales price of approximately $149.3 million. These sales resulted in an aggregate gain of approximately $46.0 million of which the Company’s share was approximately $20.7 million.
During 2006, KIR disposed of two operating properties and one land parcel, in separate transactions, for an aggregate sales price of approximately $15.2 million. These sales resulted in an aggregate gain of approximately $4.4 million of which the Company’s share was approximately $1.9 million.
In April 2005, KIR entered into a three-year (plus two one-year extension options) $30.0 million unsecured revolving credit facility which bears interest at LIBOR plus 1.40%. As of December 31, 2007, there was no outstanding balance under this credit facility and as of December 31, 2006, there was an outstanding balance of $14.0 million under this credit facility.
As of December 31, 2007, the KIR portfolio was comprised of 63 shopping center properties aggregating approximately 13.1 million square feet of GLA located in 18 states.
RioCan Investments -
During October 2001, the Company formed a joint venture (the "RioCan Venture") with RioCan Real Estate Investment Trust ("RioCan"), in which the Company has a 50% non-controlling interest, to acquire retail properties and development projects in Canada. The acquisition and development projects are to be sourced and managed by RioCan and are subject to review and approval by a joint oversight committee consisting of RioCan management and the Company’s management personnel. Capital contributions will only be required as suitable opportunities arise and are agreed to by the Company and RioCan.
94
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
As of December 31, 2007, the RioCan Venture was comprised of 34 operating properties and one joint venture investment consisting of approximately 8.2 million square feet of GLA.
Kimco / G.E. Joint Venture ("KROP")
During 2001, the Company formed a joint venture (the "Kimco Retail Opportunity Portfolio" or "KROP") with GE Capital Real Estate ("GECRE"), in which the Company has a 20% non-controlling interest and manages the portfolio. During August 2006, the Company and GECRE agreed to market for sale the properties within the KROP venture.
During 2007, KROP sold seven operating properties for an aggregate sales price of approximately $162.9 million. These sales resulted in an aggregate gain of $43.1 million of which the Company’s share was approximately $8.6 million.
During 2007, KROP transferred ten operating properties for an aggregate sales price of approximately $267.8 million, including approximately $111.6 million of non-recourse mortgage debt, to a new joint venture in which the Company holds a 15% non-controlling ownership interest. As a result of this transaction, the Company has deferred its share of the gain related to its remaining ownership interest in the properties. The Company will manage this new joint venture and accounts for this investment under the equity method of accounting.
Additionally, during 2007, KROP sold four operating properties to the Company for an aggregate sales price of approximately $89.1 million, including the assumption of $41.9 million in non-recourse mortgage debt. The Company’s share of the gains related to these transactions has been deferred.
During 2006, KROP acquired one operating property from the Company for an aggregate purchase price of approximately $3.5 million.
During 2006, KROP sold three operating properties to a joint venture in which the Company has a 20% non-controlling interest for an aggregate sales price of approximately $62.2 million. These sales resulted in an aggregate gain of approximately $26.7 million. As a result of its continued 20% ownership interest in these properties, the Company has deferred recognition of its share of these gains. In addition, KROP sold one operating property to a joint venture in which the Company has a 19% non-controlling interest for an aggregate sales price of $96.0 million. This sale resulted in a gain of approximately $42.3 million. As a result of its continued 19% ownership interest in this property, the Company deferred the portion of its gain attributable to its continued ownership interest.
Additionally, during 2006, KROP sold nine operating properties, one out-parcel and one land parcel, in separate transactions, for an aggregate sales price of approximately $171.4 million. These sales resulted in an aggregate gain of approximately $49.6 million of which the Company’s share was approximately $9.9 million.
During 2006, KROP obtained one non-recourse, non-cross collateralized variable rate mortgage for $14.0 million on a property previously unencumbered with a rate of LIBOR plus 1.10%.
Additionally during 2006, KROP obtained a one-year $15.0 million unsecured term loan, which bore interest at LIBOR plus 0.5%. This loan is guaranteed by the Company and GECRE has guaranteed reimbursement to the Company of 80% of any guaranty payment the Company is obligated to make. During 2007, this loan was fully paid off.
As of December 31, 2007, the KROP portfolio was comprised of four operating properties aggregating approximately 0.6 million square feet of GLA located in three states.
The Company’s equity in income from KROP for the year ended December 31, 2007, exceeded 10% of the Company’s income from continuing operations, as such the Company is providing summarized financial information for KROP as follows (in millions):
95
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
December 31,
2007
2006
Assets:
Real estate, net
$137.4
$ 492.5
Other assets
4.5
19.8
$141.9
$ 512.3
Liabilities and Members’ Capital:
Mortgages payable
$ 113.4
$ 337.6
Notes payable
-
22.2
Other liabilities
3.8
8.3
Minority interest
3.9
4.4
Members’ capital
20.8
139.8
$141.9
$ 512.3
Year Ended December 31,
2007
2006
2005
Revenues from rental property
$ 17.1
$ 54.7
$86.1
Operating expenses
(4.8)
(14.5)
(22.7)
Interest
(7.2)
(17.9)
(27.4)
Depreciation and amortization
(5.2)
(15.8)
(24.6)
Other, net
(0.7)
(0.6)
(1.2)
(17.9)
(48.8)
(75.9)
Income/(loss) from continuing operations
(0.8)
5.9
10.2
Discontinued Operations:
Income from discontinued operations
3.1
5.4
0.9
Gain on dispositions of properties
147.8
110.1
6.2
Net income
$150.1
$121.4
$17.3
Kimco/UBS Joint Ventures ("KUBS") -
The Company has joint venture investments with UBS Wealth Management North American Property Fund Limited ("UBS") in which the Company has non-controlling interests ranging from 15% to 20%. These joint ventures, (collectively "KUBS"), were established to acquire high quality retail properties primarily financed through the use of individual non-recourse mortgages. Capital contributions are only required as suitable opportunities arise and are agreed to by the Company and UBS. The Company manages the properties.
During 2007, KUBS acquired twelve operating properties for an aggregate purchase price of approximately $354.3 million, which included approximately $94.6 million of assumed non-recourse debt encumbering eight properties and $73.5 million of new non-recourse debt encumbering four properties. These mortgage loans have combined maturities ranging from four to seventeen years and interest rates ranging from 5.29% to 8.39%.
During 2006, KUBS acquired 15 operating properties for an aggregate purchase price of approximately $447.8 million, which included approximately $136.8 million of non-recourse debt encumbering 13 properties, with maturities ranging from three to ten years and bear interest at rates ranging from 4.74% to 6.20%.
Additionally during 2006, KUBS acquired one operating property from the Company and five operating properties from joint ventures in which the Company has 15% to 20% non-controlling interests, for an aggregate purchase price of approximately $297.0 million, including the assumption of approximately $93.2 million of non-recourse mortgage debt encumbering two of the properties, with maturities ranging from six to seven years with interest rates ranging from 5.64% to 5.88%.
96
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
As of December 31, 2007, the KUBS portfolio was comprised of 43 operating properties aggregating approximately 6.2 million square feet of GLA located in 12 states.
PL Retail -
During December 2004, the Company acquired the Price Legacy Corporation through a newly formed joint venture, PL Retail LLC ("PL Retail"), in which the Company has a 15% non-controlling interest and manages the portfolio. In connection with this transaction, PL Retail acquired 33 operating properties aggregating approximately 7.6 million square feet of GLA located in ten states. To partially fund the acquisition, the Company provided PL Retail approximately $30.6 million of secured mezzanine financing. This interest-only loan bore interest at a fixed rate of 7.5% and was repaid during 2006.
During 2007, PL Retail sold one operating property for a sales price of $40.1 million which resulted in a gain of approximately $13.5 million, of which the Company’s share was approximately $2.0 million. Proceeds from this sale were used to partially pay down the outstanding balance on PL Retail’s revolving credit facility described below.
During 2007, PL Retail obtained two non-recourse mortgage loans for an aggregate total of $84.0 million on a previously unencumbered property which bears interest at LIBOR plus 1.15% and 2.55%, respectively. These mortgage loans are scheduled to mature in May 2010.
Additionally during 2007, PL Retail obtained a non-recourse mortgage loan for $48.9 million on three properties, which bears interest at 5.95% and is scheduled to mature in September 2012.
During 2006, PL Retail sold one operating property for a sales price of approximately $42.1 million, which resulted in a gain of approximately $3.9 million of which the Company’s share was approximately $0.6 million.
Additionally during 2006, PL Retail sold one of its operating properties to a newly formed joint venture in which the Company has a 19% non-controlling interest for a sales price of approximately $109.0 million. As a result of the Company’s continued ownership no gain was recognized from this transaction. Proceeds of approximately $17.0 million from these sales were used by PL Retail to repay the remaining balance of mezzanine financing and the promissory note which were previously provided by the Company.
During 2005, PL Retail entered into a $39.5 million unsecured revolving credit facility, which bore interest at LIBOR plus 0.675% and was scheduled to mature in February 2007. During 2007, the loan was extended to February 2009 at a reduced rate of LIBOR plus 0.45%. This facility is guaranteed by the Company and the joint venture partner has guaranteed reimbursement to the Company of 85% of any guaranty payment the Company is obligated to make. As of December 31, 2007, there was $24.6 million outstanding under this facility.
As of December 31, 2007, PL Retail consisted of 22 operating properties aggregating approximately 5.6 million square feet of GLA located in seven states.
Other Real Estate Joint Ventures –
The Company and its subsidiaries have investments in and advances to various other real estate joint ventures. These joint ventures are engaged primarily in the operation and development of shopping centers which are either owned or held under long-term operating leases.
During 2007, the Company acquired, in separate transactions, 177 operating properties, through joint ventures in which the Company has various non-controlling interests. These properties were acquired for an aggregate purchase price of approximately $1.3 billion, including the assumption of approximately $612.1 million of non-recourse mortgage debt encumbering 142 of the properties and $177.5 million in proceeds from unsecured credit facilities obtained by two joint ventures. The Company accounts for its investment in these joint ventures under the equity method of accounting. The Company’s aggregate investment in these joint ventures was approximately $261.1 million. Details of these transactions are as follows (in thousands):
97
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
(1)
This property was transferred from KDI.
(2)
These properties were transferred from ventures in which the Company had preferred equity investments.
(3)
This property was transferred from the Company.
(4)
This property was purchased for redevelopment purposes.
(5)
Includes approximately $278.6 million of assumed cross-collateralized non-recourse mortgage debt with interest rates ranging from 5.19% to 5.89%, encumbering 86 properties, $186.0 million of new cross-collateralized non-recourse mortgage debt with an interest rate of 5.59%, encumbering 35 properties and a $153.0 million three-year unsecured credit facility, which bears interest at LIBOR plus 0.325% (5.55% as of December 31, 2007), and is guaranteed by the Company. The joint venture partner has pledged its equity interest for any guaranty payment the Company is obligated to pay.
(6)
Three properties acquired located in Pleasanton, CA, Laguna Hills, CA and San Diego, CA.
During 2007, the Company transferred in separate transactions, 50% of its 100% interest in seven projects located in Juarez, Tecamac, Mexicali, Cuaulta, Ciudad Del Carmen, Tijuana, and Rosarito, Mexico to a joint venture partner for approximately $48.3 million, which approximated their carrying values. As a result of these transactions, the Company has deconsolidated these entities and now accounts for its investments under the equity method of accounting.
During 2007, joint ventures in which the Company has non-controlling interests disposed of, in separate transactions, (i) seven properties for an aggregate sales price of approximately $467.3 million resulting in an aggregate gain of approximately $42.7 million, of which the Company’s share was approximately $24.9 million, and (ii) two vacant parcels of land for an aggregate sales price of $6.7 million, which resulted in no gain or loss.
During 2006, the Company acquired, in separate transactions, 36 operating properties and one ground lease, through joint ventures in which the Company has various non-controlling interests. These properties were acquired for an aggregate purchase price of approximately $726.7 million, including approximately $419.5 million of non-recourse mortgage debt encumbering 20 of the properties. The Company’s aggregate investment in these joint ventures was approximately $90.4 million. Details of these transactions are as follows (in thousands):
Purchase Price
Property Name
Location
Month Acquired
Cash
Debt
Total
GLA
Stabilus Building
Saltillo, Cahuila, Mexico
Jan-06
$ 2,600
$ -
$ 2,600
63
American Industries
(3 Locations)
Chihuahua & San Luis Postosi, Mexico
Feb-06
12,200
-
12,200
224
Crème de la Crème
(2 Locations)
Allen & Colleyville, TX
Feb-06
2,409
7,229
9,638
41
Five free-standing locations
CO, OR, NM, NY
Mar-06
7,000
-
7,000
162
Edgewater Commons
Edgewater, NJ
Mar-06
44,104
74,250
118,354
424
Long Gate Shopping Ctr
Ellicot City, MD
Mar-06
36,330
40,200
76,530
433
Clackamas Promenade
Clakamas, OR
Mar-06
35,240
42,550
77,790
237
Westmont Portfolio
(8 Locations)
Various, Canada
Mar-06
16,066
69,572
85,638
358
Crow Portfolio (3 Locations)
FL and TX
Apr-06
46,698
66,200
112,898
678
99
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Great Northeast Plaza
Philadelphia, PA
Apr-06
36,500
-
36,500
290
Cessna Building
Chihuahua, Mexico
Apr-06
2,060
-
2,060
62
Crème de la Crème
Coppell, TX
Jun-06
1,325
4,275
5,600
20
Westmont Portfolio
Houston, TX
Jun-06
14,000
47,200
61,200
460
Werner II
Juarez, Mexico
Jun-06
1,800
-
1,800
200
Cypress Towne Center
Cypress, TX
Aug-06
13,332
25,650
38,982
196
Bustleton Dunkin Donuts (ground lease)
Philadelphia, PA
Aug-06
1,000
-
1,000
2
American Industries
Juarez, Mexico
Aug-06
8,000
-
8,000
187
American Industries (ITT)
Chihuahua, Mexico
Nov-06
3,152
-
3,152
57
American Industries (Columbus)
Juarez, Mexico
Nov-06
2,174
-
2,174
39
American Industries (Zodiac)
Chihuahua, Mexico
Nov-06
3,100
-
3,100
80
Conroe Marketplace
Conroe, TX
Dec-06
18,150
42,350
60,500
244
$ 307,240
$ 419,476
$ 726,716
4,457
During January 2006, the Company transferred 50% of its 60% interest in an operating property in Guadalajara, Mexico, to a joint venture partner for approximately $12.8 million, which approximated its carrying value. As a result of this transaction, the Company now holds a 30% non-controlling interest and continues to account for its investment under the equity method of accounting.
During June 2006, the Company transferred 50% of its 60% interest in a development property located in Tijuana, Baja California, Mexico, to a joint venture partner for approximately $6.4 million, which approximated its carrying value. As a result of this transaction, the Company now holds a 30% non-controlling interest and continues to account for its investment under the equity method of accounting.
During August 2006, the Company sold 50% of its 100% interest in a development property located in Monterrey, Mexico, to a joint venture partner for approximately $9.6 million, which approximated its carrying value. The Company accounts for its remaining 50% interest under the equity method of accounting.
During 2006, joint ventures in which the Company has non-controlling interests ranging from 10% to 50%, disposed of, in separate transactions, six properties for an aggregate sales price of approximately $62.4 million. These sales resulted in an aggregate gain of approximately $8.1 million, of which the Company’s share was approximately $2.0 million.
Summarized financial information for these real estate joint ventures (excluding KROP, which is presented separately above) is as follows (in millions):
100
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
December 31,
2007
2006
Assets:
Real estate, net
$12,176.0
$11,345.0
Other assets
1,317.5
419.0
$13,493.5
$11,764.0
Liabilities and Partners’/Members’ Capital:
Mortgages payable
$ 7,901.1
$ 6,593.9
Notes payable
917.6
1,366.3
Construction loans
39.8
24.2
Other liabilities
278.6
168.4
Minority interest
101.3
102.6
Partners’/Members’ capital
4,255.1
3,508.6
$13,493.5
$11,764.0
Year Ended December 31,
2007
2006
2005
Revenues from rental property
$ 1,452.0
$952.4
$672.9
Operating expenses
(435.4)
(273.1)
(191.3)
Interest
(497.9)
(305.9)
(219.7)
Depreciation and amortization
(383.8)
(207.5)
(129.1)
Other, net
(18.2)
(12.4)
(7.2)
(1,335.3)
(798.9)
(547.3)
Income from continuing operations
116.7
153.5
125.6
Discontinued Operations:
Income/(loss) from discontinued operations
2.2
2.8
(2.6)
Gain on dispositions of properties
164.5
24.6
46.3
Net income
$283.4
$180.9
$169.3
Other liabilities included in the Company’s accompanying Consolidated Balance Sheets include accounts with certain real estate joint ventures totaling approximately $16.9 million and $13.5 million at December 31, 2007 and 2006, respectively. The Company and its subsidiaries have varying equity interests in these real estate joint ventures, which may differ from their proportionate share of net income or loss recognized in accordance with GAAP.
The Company’s maximum exposure to losses associated with its unconsolidated joint ventures is primarily limited to its carrying value in these investments. As of December 31, 2007 and 2006, the Company’s carrying value in these investments approximated $1.2 billion and $1.1 billion, respectively.
8. Other Real Estate Investments:
Preferred Equity Capital -
The Company maintains a Preferred Equity program, which provides capital to developers and owners of real estate properties. During 2007 the Company provided, in separate transactions, an aggregate of approximately $103.6 million in investment capital to developers and owners of 61 real estate properties. During 2006, the Company provided, in separate transactions, an aggregate of approximately $223.9 million in investment capital to developers and owners of 101 real estate properties. As of December 31, 2007, the Company’s net investment under the Preferred Equity program was approximately $484.1 million relating to 258 properties. For the years ended December 31, 2007, 2006 and 2005, the Company earned approximately $63.5 million including $30.5 million of profit participation earned from 18 capital transactions, $40.1 million, including $12.2 million of profit participation earned from 16 capital transactions, and $32.8 million, including $12.6 million of profit participation earned from six capital transactions, respectively, from these investments.
101
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Two of the capital transactions described above for the year ended December 31, 2007, were the result of the transfer of two operating properties, in separate transactions, to a joint venture in which the Company holds a 15% non-controlling interest for an aggregate price of approximately $40.6 million, including the assumption of approximately $26.6 million in non-recourse debt. These sales resulted in an aggregate profit participation of approximately $1.4 million.
Also, included in the capital transactions described above for the year ended December 31, 2007, was the transfer of an operating property to the Company for approximately $4.5 million, including the assumption of $3.1 million in non-recourse mortgage debt. As a result of the Company’s acquisition of this property, the Company did not recognize any profit participation.
Additionally, during 2007, the Company invested approximately $81.7 million of preferred equity capital in a portfolio comprised of 403 net leased properties which are divided into 30 master leased pools with each pool leased to individual corporate operators. These properties consist of a diverse array of free-standing restaurants, fast food restaurants, convenience and auto parts stores. As of December 31, 2007 these properties were encumbered by third party loans aggregating approximately $433.0 million with interest rates ranging from 5.08% to 10.47% with a weighted average interest rate of 9.3% and maturities ranging from 1.4 years to 15.2 years.
Summarized financial information relating to the Company’s preferred equity investments is as follows (in millions):
December 31,
2007
2006
Assets:
Real estate, net
$2,223.3
$1,683.8
Other assets
701.3
113.4
$2,924.6
$1,797.2
Liabilities and Partners’/Members’ Capital:
Notes and mortgages payable
$2,157.7
$1,239.7
Other liabilities
86.2
55.2
Partners’/Members’ capital
680.7
502.3
$2,924.6
$1,797.2
Year Ended December 31,
2007
2006
2005
Revenues from Rental Property
$266.3
$177.6
$118.5
Operating expenses
(87.5)
(58.6)
(42.0)
Interest
(111.1)
(61.6)
(38.9)
Depreciation and amortization
(60.3)
(34.2)
(19.3)
Other, net
(1.1)
(4.4)
(1.2)
6.3
18.8
17.1
Gain on disposition of properties
90.5
49.4
49.8
Net income
$ 96.8
$ 68.2
$ 66.9
The Company’s maximum exposure to losses associated with its preferred equity investments is primarily limited to its invested capital. As of December 31, 2007 and 2006, the Company’s invested capital in its preferred equity investments approximated $484.1 million and $400.4 million, respectively.
Investment in Retail Store Leases -
The Company has interests in various retail store leases relating to the anchor store premises in neighborhood and community shopping centers. These premises have been sublet to retailers who lease the stores pursuant to net lease agreements. Income from the investment in these retail store leases during the years ended December 31, 2007, 2006 and 2005, was approximately $1.2 million, $1.3 million and $9.1 million, respectively. These amounts represent sublease revenues during the years ended
102
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
December 31, 2007, 2006 and 2005, of approximately $7.7 million, $8.2 million and $17.8 million, respectively, less related expenses of $5.5 million, $5.7 million and $7.4 million, respectively, and an amount which, in management's estimate, reasonably provides for the recovery of the investment over a period representing the expected remaining term of the retail store leases. The Company's future minimum revenues under the terms of all non-cancelable tenant subleases and future minimum obligations through the remaining terms of its retail store leases, assuming no new or renegotiated leases are executed for such premises, for future years are as follows (in millions): 2008, $6.3 and $3.9; 2009, $5.9 and $3.7; 2010, $5.2 and $3.6; 2011, $4.1 and $3.1; 2012, $2.3 and $2.0 and thereafter, $1.0 and $1.3, respectively.
Leveraged Lease -
During June 2002, the Company acquired a 90% equity participation interest in an existing leveraged lease of 30 properties. The properties are leased under a long-term bond-type net lease whose primary term expires in 2016, with the lessee having certain renewal option rights. The Company’s cash equity investment was approximately $4.0 million. This equity investment is reported as a net investment in leveraged lease in accordance with SFAS No. 13, Accounting for Leases (as amended).
From 2002 to 2006, 16 of these properties were sold, whereby the proceeds from the sales were used to pay down the mortgage debt by approximately $28.3 million.
During 2007, an additional two properties were sold, whereby the proceeds from the sales were used to pay down the mortgage debt by approximately $3.0 million. As of December 31, 2007, the remaining 12 properties were encumbered by third-party non-recourse debt of approximately $48.8 million that is scheduled to fully amortize during the primary term of the lease from a portion of the periodic net rents receivable under the net lease.
As an equity participant in the leveraged lease, the Company has no recourse obligation for principal or interest payments on the debt, which is collateralized by a first mortgage lien on the properties and collateral assignment of the lease. Accordingly, this obligation has been offset against the related net rental receivable under the lease.
At December 31, 2007 and 2006, the Company’s net investment in the leveraged lease consisted of the following (in millions):
2007
2006
Remaining net rentals
$55.0
$62.3
Estimated unguaranteed residual value
36.0
40.5
Non-recourse mortgage debt
(43.9)
(48.4)
Unearned and deferred income
(43.3)
(50.7)
Net investment in leveraged lease
$ 3.8
$ 3.7
9. Mortgages and Other Financing Receivables:
The Company has various mortgages and other financing receivables which consist of loans acquired and loans originated by the Company. For a complete listing of the Company’s mortgages and other financing receivables at December 31, 2007, see Financial Statement Schedule IV included on page 132 of this annual report Form 10-K.
Reconciliation of Mortgage loans and other financing receivables on Real Estate:
The following table reconciles Mortgage loans and other financing receivables on Real Estate from January 1, 2005 to December 31, 2007:
103
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
2007
2006
2005
Balance at January 1
$162,669
$132,675
$140,717
Additions:
New mortgage loan
62,362
104,892
90,886
Additions under existing mortgage loans
38,122
54,815
6,920
Capitalized loan costs
675
1,305
377
Amortization of discount
271
673
865
Deductions:
Collections of principal
(105,277)
(97,501)
(103,860)
Charge Off
(1,837)
(609)
(1,000)
Amortization of premium
(2,298)
(33,003)
(1,513)
Amortization of loan costs
(840)
(578)
(717)
Balance at December 31
$153,847
$162,669
$132,675
10. Marketable Securities:
The amortized cost and estimated fair values of securities available-for-sale and held-to-maturity at December 31, 2007 and 2006, are as follows (in thousands):
December 31, 2007
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Estimated Fair Value
Available-for-sale:
Equity securities
$114,896
$24,846
$(13,706)
$126,036
Held-to-maturity:
Other debt securities
86,952
3,747
(4,284)
86,415
Total marketable securities
$201,848
$28,593
$(17,990)
$212,451
December 31, 2006
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Estimated Fair Value
Available-for-sale:
Equity securities
$ 82,910
$38,718
$(1,775)
$119,853
Held-to-maturity:
Other debt securities
82,806
3,451
(639)
85,618
Total marketable securities
$165,716
$42,169
$(2,414)
$205,471
For each of the securities in the Company's portfolio with unrealized losses, the Company reviews the underlying cause of the decline in value and the estimated recovery period, as well as the severity and duration of the decline. In the Company's evaluation, the Company considers its ability and intent to hold these investments for a reasonable period of time sufficient for the Company to recover its cost basis. At December 31, 2007, the aggregate unrealized loss of $18.0 million relates to marketable securities with an aggregate fair value of $83.3 million. The Company does not believe that the decline in value of any of these securities is other-than-temporary at December 31,2007.
As of December 31, 2007, the contractual maturities of Other debt securities classified as held-to-maturity are as follows: within one year, $1.4 million; after one year through five years, $39.2 million; after five years through 10 years, $28.9 million; and after 10 years, $17.5 million. Actual maturities may differ from contractual maturities as issuers may have the right to prepay debt obligations with or without prepayment penalties.
11. Notes Payable:
The Company has implemented a medium-term notes ("MTN") program pursuant to which it may, from time to time, offer for sale its senior unsecured debt for any general corporate purposes, including (i) funding specific liquidity requirements in its business, including property acquisitions, development and redevelopment costs and (ii) managing the Company's debt maturities.
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During the year ended December 31, 2007, the Company repaid the following Senior Unsecured Notes: (i) its $30.0 million 7.46% fixed rate notes, which matured on May 20, 2007, (ii) its $55.0 million 5.75% fixed rate notes, which matured on June 29, 2007, (iii) its $20.0 million 6.96% fixed rate notes which matured on July 16, 2007, (iv) its $50.0 million 7.86% fixed rate notes, which matured on November 1, 2007, (v) its $50.0 million 7.90% fixed rate notes, which matured on December 7,2007 and (vi) its $10.0 million 6.70% fixed rate notes, which matured on December 14, 2007. Additionally, the Company repaid its $35.0 million 4.96% fixed rate Senior Unsecured Notes, which matured on November 30, 2007.
As of December 31, 2007, a total principal amount of approximately $1.3 billion in senior fixed-rate MTNs was outstanding. These fixed-rate notes had maturities ranging from seven months to eight years as of December 31, 2007, and bear interest at rates ranging from 3.95% to 7.56%. Interest on these fixed-rate senior unsecured notes is payable semi-annually in arrears. Proceeds from these issuances were primarily used for the acquisition of neighborhood and community shopping centers, the expansion and improvement of properties in the Company’s portfolio and the repayment of certain debt obligations of the Company.
During March 2006, the Company issued $300.0 million of fixed rate unsecured senior notes under its MTN program. This fixed rate MTN matures March 15, 2016 and bears interest at 5.783% per annum. The proceeds from this MTN issuance were primarily used to repay a portion of the outstanding balance under the Company’s U.S. revolving credit facility and for general corporate purposes.
During June 2006, the Company entered into a third supplemental indenture, under the indenture governing its medium-term notes and senior notes, which amended the (i) total debt test and secured debt test by changing the asset value definition from undepreciated real estate assets to total assets, with total assets being defined as undepreciated real estate assets, plus other assets (but excluding goodwill and unamortized debt costs), and (ii) maintenance of unencumbered total asset value covenant by increasing the requirement of the ratio of unencumbered total asset value to outstanding unsecured debt from 1 to 1 to 1.5 to 1. Additionally, the same amended covenants were adopted within the Canadian supplemental indenture, which governs the 4.45% Canadian Debentures due in 2010. In connection with the consent solicitation, the Company incurred costs aggregating approximately $5.8 million, of which $1.8 million was related to costs paid to third parties, which were expensed. The remaining $4.0 million was related to fees paid to note holders, which were capitalized and are being amortized over the remaining term of the notes.
During 2006, the Company repaid its (i) $30.0 million 6.93% fixed rate notes, which matured on July 20, 2006, (ii) $100.0 million floating rate notes, which matured August 1, 2006, and (iii) $55.0 million 7.50% fixed rate notes, which matured on November 5, 2006.
As of December 31, 2006, a total principal amount of approximately $1.4 billion in senior fixed-rate MTNs was outstanding. These fixed-rate notes had maturities ranging from five months to nine years as of December 31, 2006, and bear interest at rates ranging from 3.95% to 7.90%. Interest on these fixed-rate senior unsecured notes is payable semi-annually in arrears. Proceeds from these issuances were primarily used for the acquisition of neighborhood and community shopping centers, the expansion and improvement of properties in the Company’s portfolio and the repayment of certain debt obligations of the Company.
During April 2007, the Company issued $300.0 million of ten-year Senior Unsecured Notes at an interest rate of 5.70% per annum payable semi-annually in arrears. These notes were sold at 99.984% of par value. Net proceeds from the issuance were approximately $297.8 million, after related transaction costs of approximately $2.2 million. The proceeds from this issuance were primarily used to repay a portion of the outstanding balance under the Company’s U.S. Credit Facility and for general corporate purposes. These notes were issued in conjunction with a fourth supplemental indenture, which removed the financial covenant requirements for this issuance and future offerings under the indenture as amended.
As of December 31, 2007, the Company had a total principal amount of $1.2 billion in fixed-rate unsecured senior notes. These fixed-rate notes had maturities ranging from nine months to nine years as of December 31, 2007, and bear interest at rates ranging from 4.70% to 7.95%. Interest on these fixed-rate senior unsecured notes is payable semi-annually in arrears.
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During August 2006, Kimco North Trust III, a wholly-owned entity of the Company, completed the issuance of $200.0 million Canadian denominated senior unsecured notes. The notes bear interest at 5.18% and mature on August 16, 2013. The proceeds were used by Kimco North Trust III, to pay down outstanding indebtedness under the existing Canadian credit facility and to fund long-term investments in Canadian real estate.
In connection with the October 31, 2006 Pan Pacific merger transaction, the Company assumed $650.0 million of unsecured notes payable, including $20.0 million of fair value debt premiums. At December 31, 2007, the remaining notes bear interest at fixed rates ranging from 4.70% to 7.95% per annum and have maturity dates ranging from September 18, 2008 to September 1, 2015.
As of December 31, 2006, the Company had a total principal amount of $1.3 billion in fixed-rate unsecured senior notes. These fixed-rate notes had maturities ranging from six months to nine years as of December 31, 2006, and bear interest at rates ranging from 4.45% to 7.95%. Interest on these fixed-rate senior unsecured notes is payable semi-annually in arrears.
The scheduled maturities of all unsecured notes payable as of December 31, 2007, were approximately as follows (in millions): 2008, $125.3; 2009, $180.0; 2010, $76.0; 2011, $360.3; 2012, $217.0; and thereafter, $1,528.1.
During October 2007, the Company established a new $1.5 billion unsecured U.S. revolving credit facility (the "U.S. Credit Facility") with a group of banks, which is scheduled to expire in October 2011. This credit facility, which replaced the Company’s $850.0 million unsecured U.S. revolving facility which was scheduled to expire in July 2008, has made available funds to finance general corporate purposes, including (i) property acquisitions, (ii) investments in the Company’s institutional management programs, (iii) development and redevelopment costs, and (iv) any short-term working capital requirements. Interest on borrowings under the U.S. Credit Facility accrues at LIBOR plus 0.375% and fluctuates in accordance with changes in the Company’s senior debt ratings. As part of this U.S. Credit Facility, the Company has a competitive bid option whereby the Company may auction up to $750.0 million of its requested borrowings to the bank group. This competitive bid option provides the Company the opportunity to obtain pricing below the currently stated spread. A facility fee of 0.125% per annum is payable quarterly in arrears. As part of the U.S. Credit Facility, the Company has a $200.0 million sub-limit which provides it the opportunity to borrow in alternative currencies such as Pounds Sterling, Japanese Yen or Euros. Pursuant to the terms of the U.S. Credit Facility, the Company, among other things, is subject to covenants requiring the maintenance of (i) maximum leverage ratios on both unsecured and secured debt, and (ii) minimum interest and fixed coverage ratios. As of December 31, 2007, there was approximately $259.0 million outstanding under this credit facility, of which approximately $9.0 million (approximately 4.5 million Pounds Sterling) was outstanding under the alternative currency sub-limit.
During August 2007, the Company obtained a $200.0 million unsecured term loan that bore interest at LIBOR plus 0.325%. The term loan was scheduled to mature on December 14, 2007. The Company utilized these proceeds to partially repay the outstanding balance on the Company’s U.S. revolving credit facility. The term loan was fully repaid in October 2007.
The Company also has a three-year CAD $250.0 million unsecured credit facility with a group of banks. This facility bore interest at the CDOR Rate, as defined, plus 0.45%, and was scheduled to expire in March 2008. During October 2007, the facility was amended to modify the covenant package to conform to the Company’s U.S. Credit Facility. The facility was further amended in January 2008, to extend the maturity date to 2011, with an additional one-year extension option, at a reduced rate of CDOR plus 0.375%, subject to change in accordance with the Company’s senior debt ratings. Proceeds from this facility are used for general corporate purposes, including the funding of Canadian denominated investments. As of December 31, 2007, there was no outstanding balance under this credit facility.
Additionally, the Company has a three-year MXP 500.0 million unsecured revolving credit facility. This facility bears interest at the TIIE Rate, as defined therein, plus 1.00%, subject to change in accordance with the Company’s senior debt ratings, and is scheduled to mature in May 2008 with an additional one-year extension option. Proceeds from this facility are used to fund peso denominated investments. As of December 31, 2007, there was MXP 250.0 million (approximately USD $22.9 million) outstanding under this credit facility.
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The Company is currently negotiating a five-year fixed rate MXP 1.0 billion term loan. Proceeds from this loan will be used to pay the outstanding balance on the MXP 500.0 million unsecured revolving credit facility and fund Mexican denominated investments.
In accordance with the terms of the Indenture, as amended, pursuant to which the Company's senior unsecured notes, except for the $300.0 million issued under the fourth supplemental indenture, described above, have been issued, the Company is (a) subject to maintaining certain maximum leverage ratios on both unsecured senior corporate and secured debt, minimum debt service coverage ratios and minimum equity levels and (b) restricted from paying dividends in amounts that exceed by more than $26.0 million the funds from operations, as defined, generated through the end of the calendar quarter most recently completed prior to the declaration of such dividend; however, this dividend limitation does not apply to any distributions necessary to maintain the Company's qualification as a REIT providing the Company is in compliance with its total leverage limitations.
12. Mortgages Payable:
During 2007, the Company (i) obtained an aggregate of approximately $285.8 million of individual non-recourse mortgage debt on 12 operating properties, (ii) assumed approximately $83.7 million of individual non-recourse mortgage debt relating to the acquisition of eight operating properties, including approximately $2.5 million of fair value debt adjustments, (iii) obtained approximately $3.2 million of additional funding on three previously encumbered properties, and (iv) paid off approximately $81.6 million of individual non-recourse mortgage debt that encumbered 11 operating properties.
During 2006, the Company (i) obtained an aggregate of approximately $52.7 million of individual non-recourse mortgage debt on five operating properties, (ii) assumed approximately $253.6 million of individual non-recourse mortgage debt relating to the acquisition of 19 operating properties, including approximately $2.9 million of fair value debt adjustments, (iii) consolidated approximately $27.1 million of non-recourse mortgage debt relating to the purchase of additional ownership interests in various entities, (iv) paid off approximately $61.9 million of individual non-recourse mortgage debt that encumbered 16 operating properties, and (v) assigned approximately $3.9 million of non-recourse mortgage debt relating to the sale of an operating property.
Mortgages payable, collateralized by certain shopping center properties and related tenants' leases, are generally due in monthly installments of principal and/or interest which mature at various dates through 2035. Interest rates range from approximately 4.95% to 10.50% (weighted-average interest rate of 6.6% as of December 31, 2007). The scheduled principal payments of all mortgages payable, excluding unamortized fair value debt adjustments of approximately $11.3 million, as of December 31, 2007, were approximately as follows (in millions): 2008, $212.9; 2009, $78.2; 2010, $47.6; 2011, $52.3; 2012, $57.4; and thereafter, $379.0.
13. Construction Loans Payable:
During 2007, the Company obtained construction financing on five merchant building projects and assumed one loan associated with a separate project for an aggregate original loan commitment amount of up to $187.1 million, of which approximately $80.9 million was outstanding at December 31, 2007. As of December 31, 2007, the Company had a total of 15 construction loans with total commitments of up to $360.3 million, of which $245.9 million had been funded. These loans have scheduled maturities ranging from one month to 33 months (excluding any extension options which may be available to the Company) and bear interest at rates ranging from 6.60% to 7.48% at December 31, 2007. These construction loans are collateralized by the respective projects and associated tenants’ leases. The scheduled maturities of all construction loans payable as of December 31, 2007, were approximately as follows (in millions): 2008, $143.9, 2009, $66.1 and 2010, $35.9.
During 2006, the Company obtained construction financing on three ground-up development projects for an aggregate original loan commitment amount of up to $83.8 million, of which approximately $36.0 million was outstanding at December 31, 2006. The Company assigned a $7.2 million construction loan, which bore interest at LIBOR plus 1.75% and
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was scheduled to mature in November 2006, in connection with the sale of its partnership interest in one project. As of December 31, 2006, the Company had a total of 13 construction loans with total commitments of up to $330.9 million, of which $271.0 million had been funded. These loans had maturities ranging from two to 31 months and variable interest rates ranging from 6.87% to 7.32% at December 31, 2006. These construction loans are collateralized by the respective projects and associated tenants’ leases. The scheduled maturities of all construction loans payable as of December 31, 2006, were approximately as follows (in millions): 2007, $164.3; 2008, $81.5; and 2009, $25.2.
14. Minority Interests:
Minority interests represent the portion of equity that the Company does not own in those entities it consolidates as a result of having a controlling interest or determined that the Company was the primary beneficiary of a variable interest entity in accordance with the provisions and guidance of FIN 46(R).
During 2006 the Company acquired seven shopping center properties located throughout Puerto Rico. The properties were acquired through the issuance of approximately $158.6 million of non-convertible units, approximately $45.8 million of convertible units, the assumption of approximately $131.2 million of non-recourse debt and $116.3 million in cash. Minority interests related to these acquisitions was approximately $233.0 million of units, including premiums of approximately $13.5 million and a fair market value adjustment of approximately $15.1 million (the "Units"). The Company is restricted from disposing of these assets, other than through a tax free transaction until November 2015.
The Units consisted of (i) approximately 81.8 million Preferred A Units par value $1.00 per unit, which pay the holder a return of 7.0% per annum on the Preferred A Par Value and are redeemable for cash by the holder at anytime after one year or callable by the Company any time after six months and contain a promote feature based upon an increase in net operating income of the properties capped at a 10.0% increase, (ii) 2,000 Class A Preferred Units, par value $10,000 per unit, which pay the holder a return equal to LIBOR plus 2.0% per annum on the Class A Preferred Par Value and are redeemable for cash by the holder at anytime after November 30, 2010, (iii) 2,627 Class B-1 Preferred Units, par value $10,000 per unit, which pay the holder a return equal to 7.0% per annum on the Class B-1 Preferred Par Value and are redeemable by the holder at anytime after November 30, 2010 for cash or at the Company’s option, shares of the Company’s common stock, equal to the Cash Redemption Amount, as defined, (iv) 5,673 Class B-2 Preferred Units, par value $10,000 per unit, which pay the holder a return equal to 7.0% per annum on the Class B-2 Preferred par value and are redeemable for cash by the holder at anytime after November 30, 2010 and (v) 640,001 Class C DownReit Units, valued at an issuance price of $30.52 per unit which pay the holder a return at a rate equal to the Company’s common stock dividend and are redeemable by the holder at anytime after November 30, 2010, for cash or at the Company’s option, shares of the Company’s common stock equal to the Class C Cash Amount, as defined.
During 2007, 2,438 units, or $24.4 million, of the Class B-1 Preferred Units were redeemed and 61,804 units, or $1.9 million, of the Class C DownREIT Units were redeemed under the Loan provision of the Agreement. The Company opted to settle these units in cash not stock. Additionally, 300 units, or $3.0 million, of the Class B-2 Preferred Units were redeemed through transfer to a charitable organization, as permitted under the provisions of the Agreement. Minority interest relating to the units was $187.6 million and $230.6 million as of December 31, 2007 and 2006, respectively.
During 2006 the Company acquired two shopping center properties located in Bay Shore and Centereach, NY during 2006. Included in Minority interests are approximately $41.6 million, including a discount of $0.3 million and a fair market value adjustment of $3.8 million, in redeemable units (the "Redeemable Units"), issued by the Company. The properties were acquired through the issuance of $24.2 million of Redeemable Units, which are redeemable at the option of the holder; approximately $14.0 million of fixed rate Redeemable Units and the assumption of approximately $23.4 million of non-recourse debt. The Redeemable Units consist of (i) 13,963 Class A Units, par value $1,000 per unit, which pay the holder a return of 5% per annum of the Class A par value and are redeemable for cash by the holder at anytime after April 3, 2011 or callable by the Company anytime after April 3, 2016, and (ii) 647,758 Class B Units, valued at an issuance price of $37.24 per unit, which pay the holder a return at a
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
rate equal to the Company’s common stock dividend and are redeemable by the holder at anytime after April 3, 2007 for cash or at the option of the Company for Common Stock at a ratio of 1:1, or callable by the Company anytime after April 3, 2026. The Company is restricted from disposing of these assets, other than through a tax free transaction, until April 2016 and April 2026 for the Centereach, NY, and Bay Shore, NY, assets, respectively.
During 2007, 30,000 units, or $1.1 million par value, of the Class B Units were redeemed by the holder in cash at the option of the Company. Minority interest relating to the units was $40.4 million and $41.6 million as of December 31, 2007 and 2006 respectively.
Minority interests also includes 138,015 convertible units issued during 2006, by the Company, which are valued at approximately $5.3 million, including a fair market value adjustment of $0.3 million, related to an interest acquired in an office building located in Albany, NY. These units are redeemable at the option of the holder after one year for cash or at the option of the Company for the Company’s common stock at a ratio of 1:1. The holder is entitled to a distribution equal to the dividend rate of the Company’s common stock. The Company is restricted from disposing of these assets, other than through a tax free transaction, until January 2017.
Minority interests also includes approximately 4.8 million convertible units (the "Convertible Units") issued by the Company valued at $80.0 million related to an interest acquired in a shopping center property located in Daly City, CA, in 2002. The Convertible Units are convertible at a ratio of 1:1 into Common Stock and are entitled to a distribution equal to the dividend rate of the Company’s common stock multiplied by 1.1057.
15. Fair Value Disclosure of Financial Instruments:
All financial instruments of the Company are reflected in the accompanying Consolidated Balance Sheets at amounts which, in management’s estimation based upon an interpretation of available market information and valuation methodologies, reasonably approximate their fair values except those listed below, for which fair values are reflected. The valuation method used to estimate fair value for fixed-rate debt and minority interests relating to mandatorily redeemable non-controlling interests associated with finite-lived subsidiaries of the Company is based on discounted cash flow analyses. The fair values for marketable securities are based on published or securities dealers’ estimated market values. Such fair value estimates are not necessarily indicative of the amounts that would be realized upon disposition. The following are financial instruments for which the Company’s estimate of fair value differs from the carrying amounts (in thousands):
16. Financial Instruments - Derivatives and Hedging:
The Company is exposed to the effect of changes in interest rates, foreign currency exchange rate fluctuations and market value fluctuations of equity securities. The Company limits these risks by following established risk management policies and procedures including the use of derivatives.
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The principal financial instruments generally used by the Company are interest rate swaps, foreign currency exchange forward contracts, cross currency swaps and equity warrant contracts. The Company, from time to time, hedges the future cash flows of its floating-rate debt instruments to reduce exposure to interest rate risk principally through interest rate swaps with major financial institutions.
During 2007, the Company entered into an interest rate swap with a notional amount of $18.75 million (which commenced on May 15, 2007). The interest rate swap is designated as a cash flow hedge and is hedging the variability of floating rate interest payments on the debt of a consolidated subsidiary. No hedge ineffectiveness on this cash flow hedge was recognized during 2007. For the year ended December 31, 2007, the change in net unrealized gains/losses on this hedge was reported in the consolidated statements of stockholders’ equity as a $0.2 million net loss. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the variable-rate debt. The change in net unrealized gains/losses on cash flow hedges reflects a reclassification of $28,000 of net unrealized gains from accumulated other comprehensive income to reduce interest expense for the year ended December 31, 2007.
As of December 31, 2006, the Company had two interest rate swaps with notional amounts of $21.5 million and $6.25 million outstanding that were designated as cash flow hedges. During 2007, these swaps were early terminated for a gain of $0.1 million. For the year ending December 31, 2007 and 2006, the change in net unrealized gains/losses on these hedges was reported in the consolidated statements of stockholders’ equity as a $0.3 million (net gain) and $0.1 million (net loss), respectively. The change in net unrealized gains/losses on cash flow hedges reflects a reclassification of $21,000 of net unrealized gains from accumulated other comprehensive income to reduce interest expense for the year ended December 31, 2007.
As of December 31, 2006, the Company had a cross currency interest rate swap with an aggregate notional amount of approximately MXP 82.4 million (approximately USD $7.6 million) designated as a hedge of its Mexican real estate investments. This cross currency interest rate swap matured during October 2007. Additionally, the Company had foreign currency forward contracts designated as net investment hedges of its Canadian investments in real estate that the Company settled during 2006. These agreements were highly effective in reducing the exposure to fluctuations in exchange rates. As such, gains and losses on these net investment hedges were reported in the same manner as a translation adjustment in accordance with SFAS No. 52, Foreign Currency Translation. During 2007 and 2006, respectively, $0.0 million and $0.2 million of unrealized losses and $0.3 million and $0.3 million of unrealized gains were included in the cumulative translation adjustment relating to the Company’s net investment hedges of its Mexican and Canadian investments.
The following tables summarize the notional values and fair values of the Company's derivative financial instruments as of December 31, 2007 and 2006:
As of December 31, 2007
Hedge Type
Notional
Value
Rate
Maturity
Fair Value
(in millions USD)
Interest rate swaps - cash flow
$18.75 million
5.062%
5/09
($0.20)
As of December 31, 2006
Hedge Type
Notional
Value
Rate
Maturity
Fair Value
(in millions USD)
MXP cross currency swap - net investment
MXP 82.4 million
7.227%
10/07
$0.10
Interest rate swaps cash flow
$6.25 million - $21.5 million
6.455% - 6.669%
3/09 – 3/16
($0.10)
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As of December 31, 2007 and 2006, respectively, these derivative instruments were reported at their fair value as other liabilities of ($0.2) million and ($0.1) million and other assets of $0.0 million and $0.1 million. The Company expects to reclassify to earnings less than $1.0 million of the current OCI balance during the next 12 months.
17. Preferred Stock, Common Stock and Convertible Unit Transactions:
During October 2007, the Company issued 18,400,000 Depositary Shares (the "Class G Depositary Shares"), after the exercise of an over-allotment option, each representing a one-hundredth fractional interest in a share of the Company’s 7.75% Class G Cumulative Redeemable Preferred Stock, par value $1.00 per share (the "Class G Preferred Stock"). Dividends on the Class G Depositary Shares are cumulative and payable quarterly in arrears at the rate of 7.75% per annum based on the $25.00 per share initial offering price, or $1.9375 per annum. The Class G Depositary Shares are redeemable, in whole or part, for cash on or after October 10, 2012 at the option of the Company, at a redemption price of $25.00 per depositary share, plus any accrued and unpaid dividends thereon. The Class G Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. Net proceeds from the sale of the Class G Depositary Shares, totaling approximately $444.5 million (after related transaction costs of $15.5 million) were used for general corporate purposes, including funding property acquisitions, investments in the Company’s institutional management programs and other investment activities. The Company also used a portion of the proceeds to partially repay amounts outstanding under its U.S. Credit Facility. The Class G Preferred Stock (represented by the Class G Depositary Shares outstanding) ranks pari passu with the Company’s Class F Preferred Stock as to voting rights, priority for receiving dividends and liquidation preference as set forth below.
During June 2003, the Company issued 7,000,000 Depositary Shares (the "Class F Depositary Shares"), each such Class F Depositary Share representing a one-tenth fractional interest of a share of the Company’s 6.65% Class F Cumulative Redeemable Preferred Stock, par value $1.00 per share (the "Class F Preferred Stock"). Dividends on the Class F Depositary Shares are cumulative and payable quarterly in arrears at the rate of 6.65% per annum based on the $25.00 per share initial offering price, or $1.6625 per annum. The Class F Depositary Shares are redeemable, in whole or part, for cash on or after June 5, 2008, at the option of the Company, at a redemption price of $25.00 per Depositary Share, plus any accrued and unpaid dividends thereon. The Class F Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. The Class F Preferred Stock (represented by the Class F Depositary Shares outstanding) ranks pari passu with the Company’s Class G Preferred Stock as to voting rights, priority for receiving dividends and liquidation preference as set forth below.
Voting Rights - As to any matter on which the Class F Preferred Stock may vote, including any action by written consent, each share of Class F Preferred Stock shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof. With respect to each share of Class F Preferred Stock, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per share of Class F Preferred Stock). As a result, each Class F Depositary Share is entitled to one vote.
As to any matter on which the Class G Preferred Stock may vote, including any action by written consent, each share of Class G Preferred Stock shall be entitled to 100 votes, each of which 100 votes may be directed separately by the holder thereof. With respect to each share of Class G Preferred Stock, the holder thereof may designate up to 100 proxies, with each such proxy having the right to vote a whole number of votes (totaling 100 votes per share of Class G Preferred Stock). As a result, each Class G Depositary Share is entitled to one vote.
Liquidation Rights - In the event of any liquidation, dissolution or winding up of the affairs of the Company, the Preferred Stock holders are entitled to be paid, out of the assets of the Company legally available for distribution to its stockholders, a liquidation preference of $250.00 per Class F Preferred share and $2,500.00 per Class G Preferred share ($25.00 per Class F and Class G Depositary Share),
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plus an amount equal to any accrued and unpaid dividends to the date of payment, before any distribution of assets is made to holders of the Company’s common stock or any other capital stock that ranks junior to the Preferred Stock as to liquidation rights.
During March 2006, the Company completed a primary public stock offering of 10,000,000 shares of the Company’s common stock. The net proceeds from this sale of Common Stock, totaling approximately $405.5 million (after related transaction costs of $2.5 million) were primarily used to repay the outstanding balance under the Company’s U.S. revolving credit facility, partial repayment of the outstanding balance under the Company’s Canadian denominated credit facility and for general corporate purposes.
During March 2006, the shareholders of Atlantic Realty Trust ("Atlantic Realty") approved the proposed merger with the Company and the closing occurred on March 31, 2006. As consideration for this transaction, the Company issued Atlantic Realty shareholders 1,274,420 shares of Common Stock, excluding 748,510 shares of Common Stock that were to be received by the Company, at a price of $40.41 per share.
On September 25, 2006, Pan Pacific stockholders approved the proposed merger with the Company and the closing occurred on October 31, 2006. Under the terms of the merger agreement, the Company agreed to acquire all of the outstanding shares of Pan Pacific for total merger consideration of $70.00 per share. As permitted under the merger agreement, the Company elected to issue $10.00 per share of the total merger consideration in the form of Common Stock. As such, the Company issued 9,185,847 shares of Common Stock valued at $407.7 million, which was based upon the average closing price of the Common Stock over the ten trading days immediately preceding the closing date.
During 2006, the Company acquired interests in seven shopping center properties located throughout Puerto Rico. The properties were acquired through the issuance of approximately $158.6 million of non-convertible units, approximately $45.8 million of convertible units, approximately $131.2 million of non-recourse debt and $116.3 million in cash.
The convertible units consist of (i) 2,627 Class B-1 Preferred Units, par value $10,000 per unit and 640,001 Class C DownREIT Units, valued at an issuance price of $30.52 per unit. Both the Class B-1 Units and the Class C DownREIT Units are redeemable by the holder at anytime after November 30, 2010 for cash or at the Company’s option, shares of the Company’s common stock. During 2007, 2,438 units, or $24.4 million, of the Class B-1 Preferred Units were redeemed and 61,804 units, or $1.9 million, of the Class C DownREIT Units were redeemed under the Loan provision of the Agreement. The Company opted to settle these units in cash. Additionally, 300 units, or $3.0 million, of the Class B-2 Preferred Units were redeemed through transfer to a charitable organization, as permitted under the provisions of the Agreement.
The number of shares of Common Stock issued upon conversion of the Class B-1 Preferred Units would be equal to the Class B-1 Cash Redemption Amount, as defined, which ranges from $6,000 to $14,000 per Class B-1 Preferred Unit depending on the Common Stock’s Adjusted Current Trading Price, as defined, divided by the average daily market price for the 20 consecutive trading days immediately preceding the redemption date.
Prior to January 1, 2009, the number of shares of Common Stock issued upon conversion of the Class C DownREIT Units would be equal to the Class C Cash Amount which equals the number of Class C DownREIT Units being redeemed, multiplied by the Adjusted Current Trading Price, as defined. After January 1, 2009, if the Adjusted Current Trading Price is greater than $36.62 then the Class C Cash Amount shall be an amount equal to the Adjusted Current Trading Price per Class C DownREIT Unit. If the Adjusted Current Trading Price is greater than $24.41 but less than $36.62, then the Class C Cash Amount shall be an amount equal to $30.51 per Class C DownREIT Unit; or is less than $24.41, then the Class C Cash Amount shall be an amount per Class C DownREIT Unit equal to the Adjusted Current Trading Price multiplied by 1.25.
During April 2006, the Company acquired interests in two shopping center properties, located in Bay Shore and Centereach, NY, valued at an aggregate $61.6 million. The properties were acquired through the issuance of units from a consolidated subsidiary and consist of approximately $24.2 million of Redeemable Units, which are redeemable at the option of the holder, approximately $14.0 million of fixed rate
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Redeemable Units and the assumption of approximately $23.4 million of non-recourse mortgage debt. The Company has the option to settle the redemption of the $24.2 million redeemable units with Common Stock, at a ratio of 1:1, or cash. During 2007, 30,000 units, or $1.1 million par value, of the Class B Units were redeemed by the holder. The Company opted to settle these units in cash.
During June 2006, the Company acquired an interest in an office property, located in Albany, NY, valued at approximately $39.9 million. The property was acquired through the issuance of approximately $5.0 million of redeemable units from a consolidated subsidiary, which are redeemable at the option of the holder after one year, and the assumption of approximately $34.9 million of non-recourse mortgage debt. The Company has the option to settle the redemption with Common Stock, at a ratio of 1:1, or cash.
During October 2002, the Company acquired an interest in a shopping center property located in Daly City, CA, valued at $80.0 million, through the issuance of approximately 4.8 million Convertible Units which are convertible at a ratio of 1:1 into the Company’s common stock. The unit holder has the right to convert the Convertible Units at any time after one year. In addition, the Company has the right to mandatorily require a conversion after ten years. If at the time of conversion the common stock price for the 20 previous trading days is less than $16.785 per share, the unit holder would be entitled to additional shares; however, the maximum number of additional shares is limited to 503,932 based upon a floor Common Stock price of $15.180. The Company has the option to settle the conversion in cash. Dividends on the Convertible Units are paid quarterly at the rate of the Company’s common stock dividend multiplied by 1.1057.
18. Supplemental Schedule of Non-Cash Investing/Financing Activities:
The following schedule summarizes the non-cash investing and financing activities of the Company for the years ended December 31, 2007, 2006 and 2005 (in thousands):
2007
2006
2005
Acquisition of real estate interests by issuance of Common Stock and/or assumption of debt
$ 82,614
$ 1,627,058
$ 73,400
Acquisition of real estate interest by issuance of redeemable units
$ -
$ 247,475
$ -
Disposition/transfer of real estate interest by assignment of down REIT units
$ -
$ -
$ 4,236
Acquisition of real estate interests through proceeds held in escrow
$ 68,031
$ 140,802
$ -
Disposition/transfer of real estate interests by assignment of mortgage debt
$ -
$ 293,254
$ 166,108
Proceeds held in escrow through sale of real estate interest
$ -
$ 39,210
$ 19,217
Acquisition of real estate through the issuance of an unsecured obligation
$ -
$ 10,586
$ -
Investment in real estate joint venture by contribution of property
$ 740
$ -
$ -
Deconsolidation of Joint Venture:
Decrease in real estate and other assets
$ 113,074
$ -
$ -
Decrease in construction loan and other liabilities
$ 113,074
$ -
$ -
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Declaration of dividends paid in succeeding period
$ 112,052
$ 93,222
$ 78,169
Consolidation of FNC:
Increase in real estate and other assets
$ -
$ -
$ 57,812
Increase in mortgage payable and other liabilities
$ -
$ -
$ 57,812
Consolidation of Kimsouth:
Increase in real estate and other assets
$ -
$ 28,377
$ -
Increase in mortgage payable and other liabilities
$ -
$ 28,377
$ -
19. Transactions with Related Parties:
During 2006, the Company, along with its joint venture partner, provided Kimco Retail Opportunity Portfolio II ("KROP II") short-term interim financing for all acquisitions by KROP II for which a mortgage was not in place at the time of closing. All such financing had maturities of less than one year and bore interest at a rate of LIBOR plus 2.0%. At December 31, 2007 and 2006, KROP II had a total of approximately $0.00 and $22.2 million, respectively, of outstanding short-term interim financing due to GECRE and the Company, of which the Company’s share is 50%. The Company earned approximately $178,000 and $248,000 during 2007 and 2006, respectively, related to such interim financing.
The Company provides management services for shopping centers owned principally by affiliated entities and various real estate joint ventures in which certain stockholders of the Company have economic interests. Such services are performed pursuant to management agreements which provide for fees based upon a percentage of gross revenues from the properties and other direct costs incurred in connection with management of the centers.
In December 2004, in conjunction with the Price Legacy transaction, the Company, which holds a 15% non-controlling interest, provided the acquiring joint venture approximately $30.6 million of secured mezzanine financing. This interest-only loan bore interest at a fixed rate of 7.5% per annum payable monthly in arrears and was repaid during 2006. The Company also provided PL Retail a secured short-term promissory note for approximately $8.2 million. This interest only note bore interest at LIBOR plus 4.5% and was scheduled to mature in June 2005. During 2005, this note was amended to bear interest at LIBOR plus 6.0% and was payable on demand. During 2006, PL Retail fully repaid to the Company the promissory note.
Ripco Real Estate Corp., was formed in 1991 and employs approximately 40 professionals and serves numerous retailers, REITS and developers. Ripco’s business activities include serving as a leasing agent and representative for national and regional retailers including Target, Best Buy, Kohls and many others, providing real estate brokerage services and principal real estate investing. Mr. Todd Cooper, an officer and 50% shareholder of Ripco, is a son of Mr. Milton Cooper, Chief Executive Officer and Chairman of the Board of Directors of the Company. During 2007 and 2006, the Company paid brokerage commissions of $257,385 and $266,191, respectively, to Ripco for services rendered primarily as leasing agent for various national tenants in shopping center properties owned by the Company. The Company believes that the brokerage commissions paid were at or below the customary rates for such leasing services. Additionally, the Company has the following joint venture investments with Ripco.
During 2005, the Company acquired three operating properties and one land parcel, through joint ventures, in which the Company and Ripco each hold 50% non-controlling interests for an aggregate purchase price of approximately $27.1 million, including the assumption of approximately $9.3 million of non-recourse mortgage debt encumbering two of the properties. The Company accounts for its investment in these joint ventures under the equity method of accounting. Subsequent to these acquisitions, the joint ventures obtained four individual one-year loans aggregating $20.4 million with interest rates ranging from LIBOR plus 0.50% to LIBOR plus 0.55%. During 2007, one of these properties was sold for a sales price of approximately $10.5 million, including the pay down of $5.0 million of debt. During 2007, two of these
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
term loans were extended until May 2008 and one was extended until October 2008. As of December 31, 2007, there was an aggregate of $15.4 million outstanding on these loans. These loans are jointly and severally guaranteed by the Company and the joint venture partner.
Reference is made to Note 7 for additional information regarding transactions with related parties.
20. Commitments and Contingencies:
The Company and its subsidiaries are primarily engaged in the operation of shopping centers which are either owned or held under long-term leases which expire at various dates through 2095. The Company and its subsidiaries, in turn, lease premises in these centers to tenants pursuant to lease agreements which provide for terms ranging generally from 5 to 25 years and for annual minimum rentals plus incremental rents based on operating expense levels and tenants' sales volumes. Annual minimum rentals plus incremental rents based on operating expense levels comprised approximately 99% of total revenues from rental property for each of the three years ended December 31, 2007, 2006 and 2005.
The future minimum revenues from rental property under the terms of all non-cancellable tenant leases, assuming no new or renegotiated leases are executed for such premises, for future years are approximately as follows (in millions): 2008, $503.3; 2009, $466.0; 2010, $420.0; 2011, $370.4; 2012, $319.7 and thereafter; $1,601.8.
Minimum rental payments under the terms of all non-cancelable operating leases pertaining to the Company’s shopping center portfolio for future years are approximately as follows (in millions): 2008, $11.4; 2009, $10.9; 2010, $9.0; 2011, $6.7; 2012, $6.0; and thereafter, $115.6.
In June 2006, the FASB issued Financial Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"), which clarifies the accounting for uncertainty in income taxes recognized in a company’s financial statements in accordance with FASB Statement No. 109, "Accounting for Income Taxes". The interpretation prescribes a recognition threshold and measurement attribute criteria for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The interpretation also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.
The Company adopted the provisions of FIN 48 on January 1, 2007. The Company does not have any material unrecognized tax benefits, therefore the adoption of FIN 48 did not have a material impact on the Company’s financial position or results of operations.
During June 2007, the Company entered into a joint venture, in which the Company has non-controlling interest, and acquired all of the common stock of InTown Suites Management, Inc. This investment was funded with approximately $186.0 million of new cross-collateralized non-recourse mortgage debt with an interest rate of 5.59%, encumbering 35 properties, a $153.0 million three-year unsecured credit facility, which bears interest at LIBOR plus 0.325% and is guaranteed by the Company and the assumption of $278.6 million cross-collateralized non-recourse mortgage debt with interest rates ranging from 5.19% to 5.89%, encumbering 86 properties. The joint venture partner has pledged its equity interest for any guaranty payment the Company is obligated to pay. The outstanding balance on the three-year unsecured credit facility was $149.0 million as of December 31, 2007. The joint venture obtained an interest rate swap at 5.37% on $128 million of this debt. The swap is designated as a cash flow hedge and as such adjustments are recorded in other comprehensive income.
During 2007, the Company entered into a joint venture, in which the Company has a non-controlling ownership interest, to acquire a property in Houston, Texas. This investment was funded with a $24.5 million one-year unsecured credit facility, with an additional one-year extension option, which bears interest at LIBOR plus 0.375% and is guaranteed by the Company. The outstanding balance on this credit facility as of December 31, 2007 was $24.5 million.
During April 2007, the Company entered into a joint venture, in which the Company has a 50% non-controlling ownership interest to acquire a property in Visalia, CA. Subsequent to this acquisition the joint venture obtained a $6.0 million three-year promissory note which bears interest at LIBOR plus 0.75% and
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
has an extension option of two-years. This loan is jointly and severally guaranteed by the Company and the joint venture partner. As of December 31, 2007, the outstanding balance on this loan was $6.0 million.
In October 2007, the Company formed a wholly-owned captive insurance company, Kimco Insurance Company, Inc., (“KIC”), which provides general liability insurance coverage for all losses below the deductible under our third-party policy. The Company entered into the Insurance Captive as part of its overall risk management program and to stabilize its insurance costs, manage exposure and recoup expenses through the functions of the captive program. The Company capitalized KIC in accordance with the applicable regulatory requirements. KIC established annual premiums based on projections derived from the past loss experience of the Company’s properties. KIC has engaged an independent third party to perform an actuarial estimate of future projected claims, related deductibles and projected expenses necessary to fund associated risk management programs. Premiums paid to KIC may be adjusted based on this estimate. Like premiums paid to third-party insurance companies, premiums paid to KIC may be reimbursed by tenants pursuant to specific lease terms. The Company believes that the addition of KIC will provide increased comprehensive insurance coverage at an overall lower cost than would otherwise be available in the market.
The KimPru joint ventures, entities in which the Company holds a 15% non-controlling interest, with PREI through three separate accounts managed by PREI obtained a two-year credit facility provided by a consortium of banks and guaranteed by the Company. PREI guaranteed reimbursement to the Company of 85% of any guaranty payment the Company is obligated to make. As of December 31, 2007, there was $702.5 million outstanding under this credit facility.
During 2006, an entity in which the Company has a preferred equity investment, located in Montreal, Canada, obtained a non-recourse construction loan, which is collateralized by the respective land and project improvements. Additionally, the Company has provided a guaranty to the lender and the developer partner has provided an indemnity to the Company for 25% of all debt. As of December 31, 2007, there was CAD $72.6 million (approximately USD $74.0 million) outstanding on this construction loan.
Additionally, during 2006, KROP obtained a one-year $15.0 million unsecured term loan, which bore interest at LIBOR plus 0.5%. This loan was guaranteed by the Company and GECRE had guaranteed reimbursement to the Company of 80% of any guaranty payment the Company was obligated to make. During 2007, KROP paid down the remaining balance of the loan.
The Company has issued letters of credit in connection with completion and repayment guarantees for construction loans encumbering certain of the Company’s ground-up development projects and guaranty of payment related to the Company’s insurance program. These letters of credit aggregate approximately $30.7 million.
In connection with the construction of its development projects and related infrastructure, certain public agencies require performance and surety bonds be posted to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of December 31, 2007, there were approximately $90.4 million bonds outstanding.
Additionally, the RioCan Venture, an entity in which the Company holds a 50% non-controlling interest, has a CAD $7.0 million (approximately USD $7.1 million) letter of credit facility. This facility is jointly guaranteed by RioCan and the Company and had approximately CAD $5.5 million (approximately USD $5.6 million) outstanding as of December 31, 2007, relating to various development projects.
During 2005, a joint venture entity in which the Company has a non-controlling interest obtained a CAD $22.5 million (approximately USD $22.9 million) credit facility to finance the construction of a 0.1 million square foot shopping center property located in Kamloops, B.C. This facility bears interest at Royal Bank Prime Rate ("RBP") plus 0.5% per annum and is scheduled to mature in March 2008. The Company and its partner in this entity each have a limited and several guarantee of CAD $7.5 million (approximately USD $7.6 million) on this facility. As of December 31, 2007, there was CAD $21.1 million (approximately USD $21.5 million) outstanding on this facility.
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
During 2005, PL Retail entered into a $39.5 million unsecured revolving credit facility, which bore interest at LIBOR plus 0.675% and was scheduled to mature in February 2007. During 2007, the loan was extended to February 2009 at a reduced rate of LIBOR plus 0.45%. This facility is guaranteed by the Company and the joint venture partner has guaranteed reimbursement to the Company of 85% of any guaranty payment the Company is obligated to make. As of December 31, 2007, there was $24.6 million outstanding under this facility.
The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. These matters are generally covered by insurance. Management believes that the final outcome of such matters will not have a material adverse effect on the financial position, results of operations or liquidity of the Company.
The Company evaluated these guarantees in connection with the provisions of FASB Interpretation No. 45, Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others and determined that the impact did not have a material effect on the Company’s financial position or results of operations.
21. Incentive Plans:
The Company maintains a stock option plan (the "Plan") pursuant to which a maximum of 42,000,000 shares of the Company’s common stock may be issued for qualified and non-qualified options. Options granted under the Plan generally vest ratably over a three year term for grants issued prior to August 1, 2005 and five-year term for grants issued after August 1, 2005, expire ten years from the date of grant and are exercisable at the market price on the date of grant, unless otherwise determined by the Board at its sole discretion. In addition, the Plan provides for the granting of certain options to each of the Company’s non-employee directors (the "Independent Directors") and permits such Independent Directors to elect to receive deferred stock awards in lieu of directors’ fees.
During December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based Payment" ("SFAS No. 123(R)"), which is a revision of Statement 123. SFAS No. 123(R) supersedes Opinion 25. Generally, the approach in SFAS No. 123(R) is similar to the approach described in Statement 123. However, SFAS No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the statement of operations based on their fair values. Pro-forma disclosure is no longer an alternative under SFAS No. 123(R). SFAS No. 123(R) is effective for fiscal years beginning after December 31, 2005. The Company began expensing stock based employee compensation with its adoption of the prospective method provisions of SFAS No. 148, effective January 1, 2003, as a result, the adoption of SFAS No. 123(R) did not have a material impact on the Company’s financial position or results of operations.
The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing formula. The assumption for expected volatility has a significant affect on the grant date fair value. Volatility is determined based on the historical equity of common stock for the most recent historical period equal to the expected term of the options. The more significant assumptions underlying the determination of fair values for options granted during 2007, 2006, and 2005 were as follows:
Year Ended December 31,
2007
2006
2005
Weighted average fair value of options granted
$7.41
$5.55
$3.21
Weighted average risk-free interest rates
4.50%
4.72%
4.03%
Weighted average expected option lives (in years)
6.50
6.50
4.80
Weighted average expected volatility
19.01%
17.70%
18.01%
Weighted average expected dividend yield
3.77%
4.39%
5.30%
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Information with respect to stock options under the Plan for the years ended December 31, 2007, 2006, and 2005, is as follows:
Shares
Weighted-Average Exercise Price Per Share
Aggregate Intrinsic value (in millions)
Options outstanding, January 1, 2005
15,239,572
$19.06
Exercised
(2,963,910)
$14.23
Granted
2,515,200
$31.15
Forfeited
(239,566)
$23.59
Options outstanding, December 31, 2005
14,551,296
$22.06
$145.8
Exercised
(2,196,947)
$17.80
Granted
2,805,650
$39.91
Forfeited
(366,406)
$28.13
Options outstanding, December 31, 2006
14,793,593
$25.93
$281.4
Exercised
(1,884,421)
$20.22
Granted
2,971,900
$41.41
Forfeited
(257,618)
$35.87
Options outstanding, December 31, 2007
15,623,454
$29.39
$133.7
Options exercisable -
December 31, 2005
8,167,681
$17.63
$118.0
December 31, 2006
8,826,881
$20.37
$217.0
December 31, 2007
9,307,184
$23.10
$123.8
The exercise prices for options outstanding as of December 31, 2007, range from $10.67 to $53.14 per share. The Company estimates forfeitures based on historical data. The weighted-average remaining contractual life for options outstanding as of December 31, 2007, was approximately 7.1 years. The weighted average remaining contractual term of options currently exercisable as of December 31, 2007 was approximately 5.8 years. Options to purchase 2,996,321, 5,969,396, and 3,817,066, shares of the Company’s common stock were available for issuance under the Plan at December 31, 2007, 2006, and 2005, respectively.
Cash received from options exercised under the Plan was approximately $38.1 million, $39.1 million, and $42.2 million for the years ended December 31, 2007, 2006, and 2005, respectively. The total intrinsic value of options exercised during 2007, 2006, and 2005 was approximately $54.4 million, $42.2 million, and $46.2 million, respectively.
The Company recognized stock options expense of $12.2 million, $10.2 million, and $4.6 million for the years ended December 31, 2007, 2006, and 2005, respectively. As of December 31, 2007, the Company had $27.7 million of total unrecognized compensation cost related to unvested stock compensation granted under the Company’s Plan. That cost is expected to be recognized over a weighted average period of approximately 3.6 years.
The Company maintains a 401(k) retirement plan covering substantially all officers and employees, which permits participants to defer up to the maximum allowable amount determined by the Internal Revenue Service of their eligible compensation. This deferred compensation, together with Company matching contributions, which generally equal employee deferrals up to a maximum of 5% of their eligible compensation (capped at $170,000), is fully vested and funded as of December 31, 2007. The Company contributions to the plan were approximately $1.5 million, $1.3 million, and $1.1 million for the years ended December 31, 2007, 2006, and 2005, respectively.
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
22. Income Taxes:
The Company elected to qualify as a REIT in accordance with the Code commencing with its taxable year which began January 1, 1992. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement that it currently distribute at least 90% of its adjusted REIT taxable income to its stockholders. It is management’s intention to adhere to these requirements and maintain the Company’s REIT status. As a REIT, the Company generally will not be subject to corporate federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under the Code. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not be able to qualify as a REIT for four subsequent taxable years. Even if the Company qualifies for taxation as a REIT, the Company is subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed taxable income. In addition, taxable income from non-REIT activities managed through taxable REIT subsidiaries is subject to federal, state and local income taxes.
Reconciliation between GAAP Net Income and Federal Taxable Income:
The following table reconciles GAAP net income to taxable income for the years ended December 31, 2007, 2006 and 2005 (in thousands):
2007 (Estimated)
2006 (Actual)
2005 (Actual)
GAAP net income
$442,830
$428,259
$363,628
Less: GAAP net income of taxable REIT subsidiaries
(98,542)
(33,795)
(21,666)
GAAP net income from REIT operations (a)
344,288
394,464
341,962
Net book depreciation in excess of tax depreciation
30,843
23,826
9,865
Deferred/prepaid/above and below market rents, net
(17,345)
(11,964)
(7,398)
Exercise of non-qualified stock options
(21,019)
(26,822)
(29,144)
Book/tax differences from investments in real estate joint ventures
18,965
(7,127)
(19,048)
Book/tax difference on sale of property
(24,177)
(49,003)
(14,181)
Valuation adjustment of foreign currency contracts
51
142
2,537
Other book/tax differences, net
5,892
(5,219)
6,773
Adjusted taxable income subject to 90% dividend requirements
$337,498
$318,297
$291,366
Certain amounts in the prior periods have been reclassified to conform to the current year presentation.
(a) - All adjustments to "GAAP net income from REIT operations" are net of amounts attributable to minority interest and taxable REIT subsidiaries.
Reconciliation between Cash Dividends Paid and Dividends Paid Deductions (in thousands):
For the years ended December 31, 2007 and 2006 cash dividends paid exceeded the dividends paid deduction and amounted to $384,502 and $332,552, respectively. For the year ended December 31, 2005, cash dividends paid were equal to the dividend paid deduction and amounted to $293,345.
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KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Characterization of Distributions:
The following characterizes distributions paid for the years ended December 31, 2007, 2006, and 2005, (in thousands):
2007
2006
2005
Preferred Dividends
Ordinary income
$ 7,123
61%
$ 8,200
70%
$10,009
86%
Capital gain
4,515
39%
3,438
30%
1,629
14%
$11,638
100%
$11,638
100%
$11,638
100%
Common Dividends
Ordinary income
$207,587
56%
$211,803
66%
$242,268
86%
Capital gain
131,558
35%
89,856
28%
39,439
14%
Return of capital
33,719
9%
19,255
6%
-
-
$372,864
100%
$320,914
100%
$281,707
100%
Total dividends distributed
$384,502
$332,552
$293,345
Taxable REIT Subsidiaries ("TRS"):
The Company is subject to federal, state and local income taxes on the income from its TRS activities, which include Kimco Realty Services ("KRS"), a wholly owned subsidiary of the Company and the consolidated entities of FNC, Kimsouth and Blue Ridge Real Estate Company/Big Boulder Corporation.
Income taxes have been provided for on the asset and liability method as required by SFAS No. 109, Accounting for Income Taxes. Under the asset and liability method, deferred income taxes are recognized for the temporary differences between the financial reporting basis and the tax basis of the TRS assets and liabilities.
The Company’s taxable income for book purposes and provision for income taxes relating to the Company’s TRS and taxable entities which have been consolidated for accounting reporting purposes, for the years ended December 31, 2007, 2006, and 2005, are summarized as follows (in thousands):
2007
2006
2005
Income before income taxes
$109,057
$54,522
$32,920
Less provision for income taxes:
Federal
6,565
17,581
9,446
State and local
3,950
3,146
1,808
Total tax provision
10,515
20,727
11,254
GAAP net income from taxable REIT subsidiaries
$ 98,542
$33,795
$21,666
The Company’s deferred tax assets and liabilities at December 31, 2007 and 2006, were as follows (in thousands):
2007
2006
Deferred tax assets:
Operating losses
$ 64,728
$ 97,288
Other
19,163
17,258
Valuation allowance
(36,826)
(68,018)
Total deferred tax assets
47,065
46,528
Deferred tax liabilities
(11,663)
(8,571)
Net deferred tax assets
$ 35,402
$ 37,957
Deferred tax assets and deferred tax liabilities are included in the caption Other assets and Other liabilities on the accompanying Consolidated Balance Sheets at December 31, 2007 and 2006. Operating losses and the valuation allowance are due to the Company’s consolidation of FNC and Kimsouth for accounting and reporting purposes. At December 31, 2007, FNC had approximately $128.1 million of net operating loss carry forwards that expire from 2022 through 2025, with a tax value of approximately $50.0 million. A valuation allowance of $33.8 million has been established for a portion of these deferred tax assets. At December 31, 2007, Kimsouth had approximately $37.9 million of net operating loss carrying forwards that expire from 2021 to 2023, with a tax value of approximately $14.8 million. A valuation allowance for $3.1 million has been established for a portion of these deferred tax assets. Other deferred tax assets and deferred tax liabilities relate primarily to differences in the timing of the recognition of income/(loss) between the GAAP and tax basis of accounting for (i) real estate joint ventures, (ii) other real estate investments, and (iii) other deductible temporary differences. The Company believes that, based on its operating strategy and consistent history of profitability, it is more likely than not that the net deferred tax assets of $35.4 million will be realized on future tax returns, primarily from the generation of future taxable income.
120
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
The income tax provision differs from the amount computed by applying the statutory federal income tax rate to taxable income before income taxes as follows (in thousands):
2007
2006
2005
Federal provision at statutory tax rate (35%)
$38,170
$19,083
$11,522
State and local taxes, net of federal Benefit
7,089
3,544
2,140
Other
(3,552)
(1,900)
(2,408)
Valuation allowance decrease
(31,192)
-
-
$10,515
$20,727
$11,254
23. Supplemental Financial Information:
The following represents the results of operations, expressed in thousands except per share amounts, for each quarter during the years 2007 and 2006:
2007 (Unaudited)
Mar. 31
June 30
Sept. 30
Dec. 31
Revenues from rental property(1)
$158,020
$170,094
$173,712
$179,727
Net income
$153,764
$128,022
$78,005
$83,039
Net income per common share:
Basic
$.60
$.50
$.30
$.28
Diluted
$.59
$.49
$.29
$.28
2006 (Unaudited)
Mar. 31
June 30
Sept. 30
Dec. 31
Revenues from rental property(1)
$136,838
$145,907
$149,124
$155,678
Net income
$96,195
$108,738
$91,427
$131,899
Net income per common share:
Basic
$.41
$.44
$.37
$.52
Diluted
$.40
$.43
$.36
$.51
(1) All periods have been adjusted to reflect the impact of operating properties sold during 2007 and 2006 and properties classified as held for sale as of December 31, 2007, which are reflected in the caption Discontinued operations on the accompanying Consolidated Statements of Income.
Accounts and notes receivable in the accompanying Consolidated Balance Sheets net of estimated unrecoverable amounts, were approximately $9.0 million and $8.5 million at December 31, 2007 and 2006, respectively.
24. Pro Forma Financial Information (Unaudited):
As discussed in Notes 3, 4 and 5, the Company and certain of its subsidiaries acquired and disposed of interests in certain operating properties during 2007. The pro forma financial information set forth below is based upon the Company's historical Consolidated Statements of Income for the years ended December 31, 2007 and 2006, adjusted to give effect to these transactions at the beginning of each year.
The pro forma financial information is presented for informational purposes only and may not be indicative of what actual results of operations would have been had the transactions occurred at the beginning of each year, nor does it purport to represent the results of operations for future periods. (Amounts presented in millions, except per share figures.)
121
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued
Year ended December 31,
2007
2006
Revenues from rental property
$719.7
$655.3
Income before extraordinary gain
$347.6
$322.2
Net income
$397.8
$322.2
Net income before extraordinary gain
per common share:
Basic
$1.30
$1.30
Diluted
$1.28
$1.27
Net income per common share:
Basic
$1.50
$1.30
Diluted
$1.47
$1.27
122
KIMCO REALTY CORPORATION AND SUBSIDIARIES
SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS
For Years Ended December 31, 2007, 2006 and 2005
(in thousands)
Balance at beginning of period
Charged to expenses
Adjustments to valuation accounts
Deductions
Balance at end of period
Year Ended December 31, 2007
Allowance for uncollectable accounts
$8,500
$ 614
$ -
($ 114)
$ 9,000
Allowance for deferred tax asset
$68,018
$ -
($31,192)
$ -
$36,826
Year Ended December 31, 2006
Allowance for uncollectable accounts
$8,500
$ 715
$ -
($ 715)
$ 8,500
Allowance for deferred tax asset
$33,783
$ -
$34,235
$ -
$68,018
Year Ended December 31, 2005
Allowance for uncollectable accounts
$8,650
$1,296
$ -
($1,446)
$ 8,500
Allowance for deferred tax asset
$ -
$ -
$33,783
$ -
$33,783
123
KIMCO REALTY CORPORATION AND SUBSIDIARIES
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2007
INITIAL COST
PROPERTIES
LAND
BUILDING & IMPROVEMENT
SUBSEQUENT TO ACQUISITION
LAND
BUILDING & IMPROVEMENT
TOTAL
ACCUMULATED DEPRECIATION
TOTAL COST, NET OF ACCUMULATED DEPRECIATION
ENCUMBRANCES
DATE OF CONSTRUCTION(C) ACQUISITION(A)
KDI-GLENN SQUARE
3,306,779
-
30,179,625
3,306,779
30,179,625
33,486,404
-
33,486,404
2006(C)
HOOVER
279,106
7,735,873
-
279,106
7,735,873
8,014,979
1,586,999
6,427,980
1999(A)
KDI-THE GROVE
18,951,763
6,403,809
-
18,951,763
6,403,809
25,355,572
-
25,355,572
20,576,767
2007(C)
KDI-CHANDLER AUTO MALLS
9,318,595
-
4,167,140
10,349,707
3,136,028
13,485,735
-
13,485,735
2004(C)
TALAVI TOWN CENTER
8,046,677
17,016,784
-
8,046,677
17,016,784
25,063,461
4,925,374
20,138,087
2007(A)
KIMCO MESA 679, INC. AZ
2,915,000
11,686,291
1,678,931
2,915,000
13,365,222
16,280,222
3,294,369
12,985,853
1998(A)
MESA RIVERVIEW
15,000,000
-
114,236,601
750,000
128,486,601
129,236,601
1,100,000
128,136,601
2005(C)
KDI-ANA MARIANA POWER CENTER
30,043,645
-
1,425,411
30,043,645
1,425,411
31,469,056
-
31,469,056
23,505,135
2006(C)
METRO SQUARE
4,101,017
16,410,632
870,871
4,101,017
17,281,503
21,382,520
4,941,165
16,441,355
1998(A)
HAYDEN PLAZA NORTH
2,015,726
4,126,509
5,448,097
2,015,726
9,574,606
11,590,332
1,969,976
9,620,356
1998(A)
PHOENIX, COSTCO
5,324,501
21,269,943
6,348,938
5,324,501
27,618,882
32,943,382
5,212,518
27,730,864
1998(A)
PHOENIX
2,450,341
9,802,046
683,405
2,450,341
10,485,451
12,935,792
2,839,759
10,096,033
1997(A)
KDI-ASANTE RETAIL CENTER
8,702,635
-
10,576,838
15,178,232
4,101,241
19,279,473
-
19,279,473
11,112,252
2004(C)
ALHAMBRA, COSTCO
4,995,639
19,982,557
42,891
4,995,639
20,025,448
25,021,087
4,950,683
20,070,404
1998(A)
MADISON PLAZA
5,874,396
23,476,190
262,248
5,874,396
23,738,439
29,612,834
5,818,218
23,794,616
1998(A)
CHULA VISTA, COSTCO
6,460,743
25,863,153
11,674,917
6,460,743
37,538,070
43,998,813
7,129,071
36,869,742
1998(A)
CORONA HILLS, COSTCO
13,360,965
53,373,453
1,971,945
13,360,965
55,345,398
68,706,363
13,419,862
55,286,501
1998(A)
EAST AVENUE MARKET PLACE
1,360,457
3,055,127
221,550
1,360,457
3,276,677
4,637,134
1,694,571
2,942,563
2,162,350
2006(A)
LABAND VILLAGE SC
5,600,000
11,709,367
1,644,132
5,600,000
13,353,500
18,953,500
1,378,872
17,574,628
9,213,957
2005(A)
CUPERTINO VILLAGE
19,886,099
46,534,919
4,456,725
19,886,099
50,991,644
70,877,744
9,618,657
61,259,086
37,092,346
2006(A)
CHICO CROSSROADS
9,975,810
30,538,372
-
9,975,810
30,538,372
40,514,182
1,178,319
39,335,863
25,372,802
2007(A)
CORONA HILLS MARKETPLACE
9,727,446
24,778,390
-
9,727,446
24,778,390
34,505,836
503,094
34,002,743
2007(A)
ELK GROVE VILLAGE
1,770,000
7,470,136
624,282
1,770,000
8,094,418
9,864,417
3,685,604
6,178,813
2,279,310
2006(A)
WATERMAN PLAZA
784,851
1,762,508
122,050
784,851
1,884,557
2,669,409
977,601
1,691,807
1,556,503
2006(A)
GOLD COUNTRY CENTER
3,272,212
7,864,878
0
3,272,212
7,864,878
11,137,090
561,544
10,575,546
7,144,447
2007(A)
LA MIRADA THEATRE CENTER
8,816,741
35,259,965
(7,736,043)
6,888,680
29,451,983
36,340,663
6,935,842
29,404,821
1998(A)
YOSEMITE NORTH SHOPPING CTR
2,120,247
4,761,355
564,711
2,120,247
5,326,066
7,446,312
1,389,508
6,056,804
2006(A)
RALEY'S UNION SQUARE
1,185,909
2,663,149
215,617
1,185,909
2,878,766
4,064,675
1,004,180
3,060,495
2006(A)
SOUTH NAPA MARKET PLACE
1,100,000
22,159,086
6,812,402
1,100,000
28,971,488
30,071,488
2,993,589
27,077,898
2006(A)
PLAZA DI NORTHRIDGE
12,900,000
40,574,842
6,563,870
12,900,000
47,138,712
60,038,712
5,180,526
54,858,186
29,405,832
2005(A)
POWAY CITY CENTRE
5,854,585
13,792,470
7,597,380
7,247,814
19,996,622
27,244,435
2,090,677
25,153,758
2005(A)
NORTH POINT PLAZA
1,299,733
2,918,760
246,929
1,299,733
3,165,689
4,465,422
1,624,024
2,841,398
2006(A)
RED BLUFF SHOPPING CTR
1,410,936
3,168,485
258,380
1,410,936
3,426,866
4,837,802
1,198,409
3,639,393
2006(A)
TYLER STREET
3,020,883
7,746,659
(0)
3,020,883
7,746,659
10,767,542
730,903
10,036,639
6,877,365
2007(A)
THE CENTRE
3,403,724
13,625,899
244,311
3,403,724
13,870,210
17,273,934
2,892,184
14,381,750
6,976,527
1999(A)
SANTA ANA, HOME DEPOT
4,592,364
18,345,257
0
4,592,364
18,345,257
22,937,622
4,515,769
18,421,853
1998(A)
FULTON MARKET PLACE
2,966,018
6,920,710
690,689
2,966,018
7,611,398
10,577,417
937,097
9,640,319
2005(A)
MARIGOLD SC
15,300,000
25,563,978
3,654,408
15,300,000
29,218,386
44,518,386
4,059,291
40,459,095
18,018,337
2005(A)
BLACK MOUNTAIN VILLAGE
4,678,015
11,913,344
-
4,678,015
11,913,344
16,591,359
599,941
15,991,418
2007(A)
TRUCKEE CROSSROADS
2,140,000
8,255,753
462,340
2,140,000
8,718,093
10,858,093
2,912,814
7,945,279
4,154,420
2006(A)
WESTLAKE SHOPPING CENTER
16,174,307
64,818,562
81,619,961
16,174,307
146,438,523
162,612,830
9,508,250
153,104,579
2002(A)
VILLAGE ON THE PARK
2,194,463
8,885,987
5,276,698
2,194,463
14,162,685
16,357,148
2,440,382
13,916,765
1998(A)
AURORA QUINCY
1,148,317
4,608,249
243,297
1,148,317
4,851,546
5,999,863
1,207,706
4,792,157
1998(A)
AURORA EAST BANK
1,500,568
6,180,103
400,565
1,500,568
6,580,668
8,081,236
1,621,829
6,459,407
1998(A)
SPRING CREEK COLORADO
1,423,260
5,718,813
34,594
1,423,260
5,753,406
7,176,667
1,471,062
5,705,604
1998(A)
DENVER WEST 38TH STREET
161,167
646,983
(0)
161,167
646,983
808,150
164,490
643,661
1998(A)
ENGLEWOOD PHAR MOR
805,837
3,232,650
137,553
805,837
3,370,204
4,176,040
840,399
3,335,641
1998(A)
FORT COLLINS
1,253,497
7,625,278
1,599,608
1,253,497
9,224,886
10,478,382
1,533,186
8,945,196
2,596,503
2000(A)
HERITAGE WEST
1,526,576
6,124,074
141,245
1,526,576
6,265,319
7,791,895
1,582,450
6,209,444
1998(A)
WEST FARM SHOPPING CENTER
5,805,969
23,348,024
498,278
5,805,969
23,846,302
29,652,271
5,729,201
23,923,070
1998(A)
FARMINGTON PLAZA
433,713
1,211,800
1,635,657
433,713
2,847,457
3,281,170
116,216
3,164,954
453,851
2005(A)
N.HAVEN, HOME DEPOT
7,704,968
30,797,640
472,418
7,704,968
31,270,058
38,975,026
7,590,198
31,384,829
1998(A)
SOUTHINGTON PLAZA
376,256
1,055,168
292,292
376,256
1,347,460
1,723,716
49,735
1,673,980
453,851
2005(A)
WATERBURY
2,253,078
9,017,012
344,937
2,253,078
9,361,949
11,615,027
3,339,654
8,275,373
1993(A)
DOVER
122,741
66,738
4,808,264
3,024,375
1,973,368
4,997,743
1,579
4,996,164
2003(A)
ELSMERE
-
3,185,642
(0)
-
3,185,642
3,185,642
3,185,642
0
1979(C)
ALTAMONTE SPRINGS
770,893
3,083,574
167,155
770,893
3,250,729
4,021,622
968,353
3,053,269
1995(A)
BOCA RATON
573,875
2,295,501
1,721,711
733,875
3,857,212
4,591,087
1,485,875
3,105,212
1992(A)
BAYSHORE GARDENS, BRADENTON FL
2,901,000
11,738,955
520,415
2,901,000
12,259,370
15,160,370
3,061,583
12,098,787
1998(A)
BRADENTON PLAZA
527,026
765,252
87,969
527,026
853,221
1,380,247
37,635
1,342,612
2005(A)
CORAL SPRINGS
710,000
2,842,907
3,275,003
710,000
6,117,910
6,827,910
1,797,196
5,030,714
1994(A)
CORAL SPRINGS
1,649,000
6,626,301
251,424
1,649,000
6,877,725
8,526,725
1,749,906
6,776,819
1997(A)
CURLEW CROSSING S.C.
5,315,955
12,529,467
1,182,820
5,315,955
13,712,288
19,028,242
1,248,369
17,779,873
2005(A)
CLEARWATER FL
3,627,946
918,466
-
3,627,946
918,466
4,546,411
7,560
4,538,851
2007(A)
EAST ORLANDO
491,676
1,440,000
2,939,953
1,007,882
3,863,747
4,871,629
2,371,276
2,500,353
1971(C)
FERN PARK
225,000
902,000
4,067,704
225,000
4,969,704
5,194,704
2,111,514
3,083,190
1968(C)
REGENCY PLAZA
2,410,000
9,671,160
396,139
2,410,000
10,067,299
12,477,299
2,093,834
10,383,466
1999(A)
SHOPPES AT AMELIA CONCOURSE
7,600,000
-
8,578,937
1,138,216
15,040,721
16,178,937
-
16,178,937
2003(C)
124
INITIAL COST
PROPERTIES
LAND
BUILDING & IMPROVEMENT
SUBSEQUENT TO ACQUISITION
LAND
BUILDING & IMPROVEMENT
TOTAL
ACCUMULATED DEPRECIATION
TOTAL COST, NET OF ACCUMULATED DEPRECIATION
ENCUMBRANCES
DATE OF CONSTRUCTION(C) ACQUISITION(A)
AVENUES WALKS
26,984,546
-
18,701,233
33,920,717
11,765,062
45,685,779
-
45,685,779
2005(C)
KISSIMMEE
1,328,536
5,296,652
(2,019,131)
1,328,536
3,277,521
4,606,057
2,140,225
2,465,832
1996(A)
LAUDERDALE LAKES
342,420
2,416,645
3,586,346
416,833
5,928,578
6,345,411
3,798,003
2,547,408
1968(C)
MERCHANTS WALK
2,580,816
10,366,090
690,218
2,580,816
11,056,308
13,637,125
1,850,983
11,786,141
2001(A)
LARGO
293,686
792,119
1,226,847
293,686
2,018,966
2,312,652
1,769,051
543,600
1968(C)
LEESBURG
-
171,636
193,651
365,287
365,287
286,910
78,378
1969(C)
LARGO EAST BAY
2,832,296
11,329,185
1,527,169
2,832,296
12,856,354
15,688,650
5,715,472
9,973,178
1992(A)
LAUDERHILL
1,002,733
2,602,415
12,095,862
1,774,443
13,926,567
15,701,010
7,353,530
8,347,480
1974(C)
THE GROVES
1,676,082
6,533,681
930,164
2,606,246
6,533,681
9,139,927
580,553
8,559,375
2006(A)
MELBOURNE
-
1,754,000
3,061,746
-
4,815,746
4,815,746
2,448,672
2,367,075
1968(C)
GROVE GATE
365,893
1,049,172
1,207,100
365,893
2,256,272
2,622,165
1,757,235
864,930
1968(C)
NORTH MIAMI
732,914
4,080,460
10,773,730
732,914
14,854,190
15,587,104
6,437,887
9,149,217
1985(A)
MILLER ROAD
1,138,082
4,552,327
1,855,566
1,138,082
6,407,893
7,545,975
5,100,541
2,445,434
1986(A)
MARGATE
2,948,530
11,754,120
3,726,484
2,948,530
15,480,604
18,429,134
5,123,113
13,306,021
1993(A)
MT. DORA
1,011,000
4,062,890
139,971
1,011,000
4,202,861
5,213,861
1,102,942
4,110,919
1997(A)
PLANTATION CROSSING
7,524,800
-
17,444,009
7,312,496
17,656,313
24,968,809
-
24,968,809
2005(C)
MILTON, FL
1,275,593
-
-
1,275,593
-
1,275,593
-
1,275,593
2007(A)
FLAGLER PARK
26,162,980
80,737,041
-
26,162,980
80,737,041
106,900,021
2,521,151
104,378,870
2007(A)
ORLANDO
923,956
3,646,904
1,952,475
1,172,119
5,351,216
6,523,335
1,777,718
4,745,617
1995(A)
RENAISSANCE CENTER
9,104,379
36,540,873
4,890,546
9,122,758
41,413,040
50,535,798
11,485,945
39,049,853
1998(A)
SAND LAKE
3,092,706
12,370,824
1,761,715
3,092,706
14,132,539
17,225,245
4,755,399
12,469,846
1994(A)
ORLANDO
560,800
2,268,112
3,133,942
580,030
5,382,824
5,962,854
1,353,918
4,608,936
1996(A)
OCALA
1,980,000
7,927,484
6,136,835
1,980,000
14,064,319
16,044,319
2,986,996
13,057,323
1997(A)
POMPANO BEACH
97,169
874,442
1,816,086
247,843
2,539,854
2,787,697
1,526,033
1,261,665
1968(C)
GONZALEZ
1,617,564
-
-
1,617,564
-
1,617,564
-
1,617,564
2007(A)
ST. PETERSBURG
-
917,360
984,890
1,902,250
1,902,250
827,591
1,074,659
1968(C)
TUTTLE BEE SARASOTA
254,961
828,465
1,747,305
254,961
2,575,770
2,830,731
1,874,788
955,943
1970(C)
SOUTH EAST SARASOTA
1,283,400
5,133,544
3,417,895
1,399,525
8,435,314
9,834,839
3,624,219
6,210,620
1989(A)
SANFORD
1,832,732
9,523,261
5,865,590
1,832,732
15,388,851
17,221,583
7,027,374
10,194,210
1989(A)
STUART
2,109,677
8,415,323
610,198
2,109,677
9,025,521
11,135,198
3,051,419
8,083,779
1994(A)
SOUTH MIAMI
1,280,440
5,133,825
2,853,984
1,280,440
7,987,809
9,268,249
2,301,384
6,966,865
1995(A)
TAMPA
5,220,445
16,884,228
2,096,967
5,220,445
18,981,195
24,201,640
4,126,159
20,075,481
1997(A)
VILLAGE COMMONS S.C.
2,192,331
8,774,158
626,582
2,192,331
9,400,740
11,593,071
2,143,128
9,449,943
1998(A)
MISSION BELL SHOPPING CENTER
5,056,426
11,843,119
5,972,809
5,067,033
17,805,321
22,872,354
3,033,672
19,838,682
2004(A)
WEST PALM BEACH
550,896
2,298,964
1,142,075
550,896
3,441,039
3,991,935
915,569
3,076,366
1995(A)
THE SHOPS AT WEST MELBOURNE
2,200,000
8,829,541
4,317,932
2,200,000
13,147,473
15,347,473
2,888,068
12,459,405
1998(A)
AUGUSTA
1,482,564
5,928,122
2,176,418
1,482,564
8,104,540
9,587,104
2,139,467
7,447,637
1995(A)
MARKET AT HAYNES BRIDGE
4,880,659
21,074,606
-
4,880,659
21,074,606
25,955,265
1,202,200
24,753,065
15,731,504
2007(A)
EMBRY VILLAGE
18,147,054
32,919,287
-
18,147,054
32,919,287
51,066,341
1,086,168
49,980,173
31,081,683
2007(A)
SAVANNAH
2,052,270
8,232,978
1,224,028
2,052,270
9,457,006
11,509,276
3,450,826
8,058,450
1993(A)
SAVANNAH
652,255
2,616,522
2,003,023
652,256
4,619,545
5,271,800
921,903
4,349,897
1995(A)
CHATHAM PLAZA
13,390,238
34,176,637
-
13,390,238
34,176,637
47,566,875
755,173
46,811,702
29,779,657
2007(A)
KIHEI CENTER
3,406,707
7,663,360
598,386
3,406,707
8,261,745
11,668,453
4,262,254
7,406,199
2006(A)
CLIVE
500,525
2,002,101
(0)
500,525
2,002,101
2,502,626
611,754
1,890,872
1996(A)
KDI-METRO CROSSING
3,013,647
-
11,935,150
2,294,414
12,654,383
14,948,797
-
14,948,797
5,314,614
2006(C)
SOUTHDALE SHOPPING CENTER
1,720,330
6,916,294
3,029,374
1,720,330
9,945,668
11,665,998
1,776,463
9,889,534
3,281,092
1999(A)
DES MOINES
500,525
2,559,019
37,079
500,525
2,596,098
3,096,623
772,126
2,324,497
1996(A)
DUBUQUE
-
2,152,476
10,848
2,163,324
2,163,324
561,860
1,601,464
1997(A)
WATERLOO
500,525
2,002,101
2,869,100
500,525
4,871,201
5,371,726
1,329,024
4,042,701
1996(A)
NAMPA (HORSHAM) FUTURE DEV.
6,501,240
-
9,818,321
10,874,179
5,445,382
16,319,561
-
16,319,561
10,057,969
2005(C)
ALTON, BELTLINE HWY
329,532
1,987,981
59,935
329,532
2,047,916
2,377,448
489,489
1,887,959
1998(A)
AURORA, N. LAKE
2,059,908
9,531,721
308,208
2,059,908
9,839,929
11,899,837
2,300,374
9,599,463
1998(A)
BLOOMINGTON
805,521
2,222,353
5,238,917
805,521
7,461,270
8,266,791
4,401,413
3,865,378
1972(C)
BELLEVILLE, WESTFIELD PLAZA
-
5,372,253
(0)
-
5,372,253
5,372,253
1,297,029
4,075,224
1998(A)
BRADLEY
500,422
2,001,687
424,877
500,422
2,426,564
2,926,986
713,745
2,213,241
1996(A)
CALUMET CITY
1,479,217
8,815,760
13,397,758
1,479,216
22,213,519
23,692,735
2,943,371
20,749,363
1997(A)
COUNTRYSIDE
-
4,770,671
1,137,295
1,101,670
4,806,296
5,907,966
1,218,402
4,689,564
1997(A)
CHICAGO
-
2,687,046
651,220
3,338,266
3,338,266
805,446
2,532,820
1997(A)
CHAMPAIGN, NEIL ST.
230,519
1,285,460
437,906
230,519
1,723,366
1,953,885
305,466
1,648,419
1998(A)
ELSTON
1,010,375
5,692,211
0
1,010,374
5,692,212
6,702,586
1,362,060
5,340,526
1997(A)
S. CICERO
-
1,541,560
149,202
1,690,762
1,690,762
442,879
1,247,883
1997(A)
CRYSTAL LAKE, NW HWY
179,964
1,025,811
120,440
180,269
1,145,946
1,326,215
268,358
1,057,857
1998(A)
BUTTERFIELD SQUARE
1,601,960
6,637,926
(3,480,427)
1,182,677
3,576,782
4,759,459
982,260
3,777,198
1998(A)
DOWNERS PARK PLAZA
2,510,455
10,164,494
638,196
2,510,455
10,802,690
13,313,145
2,538,307
10,774,839
1999(A)
DOWNER GROVE
811,778
4,322,956
1,716,869
811,778
6,039,824
6,851,603
1,466,958
5,384,645
1997(A)
ELGIN
842,555
2,108,674
2,154,406
842,555
4,263,080
5,105,635
2,962,357
2,143,278
1972(C)
FOREST PARK
-
2,335,884
(0)
2,335,884
2,335,884
614,178
1,721,706
1997(A)
FAIRVIEW HTS, BELLVILLE RD.
-
11,866,880
1,881,567
13,748,447
13,748,447
3,107,490
10,640,957
1998(A)
GENEVA
500,422
12,917,712
66,897
500,422
12,984,609
13,485,031
3,251,484
10,233,547
8,857,992
1996(A)
LAKE ZURICH PLAZA
233,698
1,265,023
169,197
233,698
1,434,219
1,667,918
22,646
1,645,272
2005(A)
MATTERSON
950,515
6,292,319
10,527,541
950,514
16,819,861
17,770,375
3,192,501
14,577,873
1997(A)
MT. PROSPECT
1,017,345
6,572,176
3,557,866
1,017,345
10,130,041
11,147,387
2,380,106
8,767,280
1997(A)
MUNDELEIN, S. LAKE
1,127,720
5,826,129
77,350
1,129,634
5,901,565
7,031,199
1,409,976
5,621,223
1998(A)
125
INITIAL COST
PROPERTIES
LAND
BUILDING & IMPROVEMENT
SUBSEQUENT TO ACQUISITION
LAND
BUILDING & IMPROVEMENT
TOTAL
ACCUMULATED DEPRECIATION
TOTAL COST, NET OF ACCUMULATED DEPRECIATION
ENCUMBRANCES
DATE OF CONSTRUCTION(C) ACQUISITION(A)
NORRIDGE
-
2,918,315
(0)
2,918,315
2,918,315
761,666
2,156,649
1997(A)
NAPERVILLE
669,483
4,464,998
70,677
669,483
4,535,675
5,205,158
1,132,536
4,072,622
1997(A)
OTTAWA
137,775
784,269
700,540
137,775
1,484,809
1,622,584
978,175
644,409
1970(C)
ORLAND PARK, S. HARLEM
476,972
2,764,775
1,233,171
476,972
3,997,945
4,474,918
845,535
3,629,382
1998(A)
OAK LAWN
1,530,111
8,776,631
539,848
1,530,111
9,316,479
10,846,590
2,277,952
8,568,638
13,952,147
1997(A)
OAKBROOK TERRACE
1,527,188
8,679,108
2,972,827
1,527,188
11,651,935
13,179,123
2,551,672
10,627,451
1997(A)
PEORIA
-
5,081,290
2,381,722
7,463,012
7,463,012
1,642,339
5,820,673
1997(A)
FREESTATE BOWL
252,723
998,099
(0)
252,723
998,099
1,250,822
347,694
903,128
2003(A)
ROCKFORD CROSSING
4,556,176
11,603,061
-
4,556,176
11,603,061
16,159,236
-
16,159,236
11,512,228
2007(A)
ROUND LAKE BEACH PLAZA
790,129
1,634,148
529,045
790,129
2,163,193
2,953,322
65,642
2,887,680
2005(A)
SKOKIE
-
2,276,360
9,488,382
2,628,440
9,136,303
11,764,742
1,578,627
10,186,116
7,345,176
1997(A)
KRC STREAMWOOD
181,962
1,057,740
181,885
181,962
1,239,624
1,421,587
278,783
1,142,803
1998(A)
WOODGROVE FESTIVAL
5,049,149
20,822,993
2,100,007
5,049,149
22,923,000
27,972,149
5,500,088
22,472,061
1998(A)
WAUKEGAN
203,427
1,161,847
37,012
203,772
1,198,514
1,402,286
271,284
1,131,002
1998(A)
WAUKEGAN PLAZA
349,409
883,975
276,202
349,409
1,160,177
1,509,586
12,609
1,496,977
2005(A)
PLAZA EAST
1,236,149
4,944,597
2,820,843
1,140,849
7,860,740
9,001,589
2,153,485
6,848,105
1995(A)
GREENWOOD
423,371
1,883,421
1,935,968
584,445
3,658,315
4,242,760
2,556,337
1,686,423
1970(C)
GRIFFITH
-
2,495,820
981,912
1,001,100
2,476,632
3,477,732
657,512
2,820,219
1997(A)
LAFAYETTE
230,402
1,305,943
169,272
230,402
1,475,215
1,705,617
1,354,454
351,163
1971(C)
LAFAYETTE
812,810
3,252,269
4,093,726
2,379,198
5,779,607
8,158,805
1,256,263
6,902,541
1997(A)
KIMCO LAFAYETTE MARKET PLACE
4,184,000
16,752,165
243,806
4,184,000
16,995,971
21,179,971
4,268,307
16,911,664
1998(A)
KRC MISHAWAKA 895
378,088
1,999,079
642
378,730
1,999,079
2,377,809
481,830
1,895,979
1998(A)
MERRILLVILLE PLAZA
197,415
765,630
219,832
197,415
985,462
1,182,877
13,444
1,169,433
2005(A)
SOUTH BEND, S. HIGH ST.
183,463
1,070,401
196,857
183,463
1,267,258
1,450,721
282,015
1,168,706
1998(A)
OVERLAND PARK
1,183,911
6,335,308
142,374
1,185,906
6,475,686
7,661,593
1,521,597
6,139,995
1998(A)
BELLEVUE
405,217
1,743,573
154,924
405,217
1,898,497
2,303,714
1,793,435
510,279
1976(A)
LEXINGTON
1,675,031
6,848,209
5,218,774
1,551,079
12,190,935
13,742,014
4,305,090
9,436,924
1993(A)
PADUCAH MALL, KY
-
924,085
0
924,085
924,085
311,638
612,447
1998(A)
HAMMOND AIR PLAZA
3,813,873
15,260,609
1,832,781
3,813,873
17,093,391
20,907,263
4,486,593
16,420,670
1997(A)
KIMCO HOUMA 274, LLC
1,980,000
7,945,784
204,887
1,980,000
8,150,671
10,130,671
1,691,290
8,439,380
1999(A)
CENTRE AT WESTBANK
9,417,685
23,983,705
-
9,417,685
23,983,705
33,401,390
-
33,401,390
21,707,772
2007(A)
LAFAYETTE
2,115,000
8,508,218
9,415,321
3,678,274
16,360,265
20,038,539
3,818,939
16,219,601
1997(A)
111-115 NEWBURY
3,551,989
10,819,763
-
3,551,989
10,819,763
14,371,752
-
14,371,752
2007(A)
493-495 COMMONWEALTH AVENUE
1,151,947
5,798,705
-
1,151,947
5,798,705
6,950,652
-
6,950,652
2007(A)
127-129 NEWBURY LLC
2,947,063
8,841,188
-
2,947,063
8,841,188
11,788,250
-
11,788,250
2007(A)
GREAT BARRINGTON
642,170
2,547,830
7,054,830
751,124
9,493,706
10,244,830
2,561,705
7,683,125
1994(A)
SHREWSBURY SHOPPING CENTER
1,284,168
5,284,853
4,532,528
1,284,168
9,817,381
11,101,549
1,682,397
9,419,152
2000(A)
WILDE LAKE
1,468,038
5,869,862
101,365
1,468,038
5,971,227
7,439,265
892,695
6,546,569
2002(A)
LYNX LANE
1,019,035
4,091,894
85,071
1,019,035
4,176,965
5,196,000
649,346
4,546,655
2002(A)
CLINTON BANK BUILDING
82,967
362,371
(0)
82,967
362,371
445,338
188,271
257,067
2003(A)
CLINTON BOWL
39,779
130,716
4,247
38,779
135,963
174,742
64,100
110,642
2003(A)
VILLAGES AT URBANA
3,190,074
6,067
10,424,583
4,828,774
8,791,951
13,620,725
-
13,620,725
2003(A)
GAITHERSBURG
244,890
6,787,534
230,545
244,890
7,018,079
7,262,969
1,445,484
5,817,485
1999(A)
HAGERSTOWN
541,389
2,165,555
2,906,588
541,389
5,072,144
5,613,532
2,492,923
3,120,609
1973(C)
SHAWAN PLAZA
4,466,000
20,222,367
(0)
4,466,000
20,222,367
24,688,367
3,833,638
20,854,729
12,180,611
2003(A)
LAUREL
349,562
1,398,250
1,023,918
349,562
2,422,168
2,771,730
963,007
1,808,723
1995(A)
LAUREL
274,580
1,100,968
283,421
274,580
1,384,389
1,658,969
1,283,408
375,561
1972(C)
LANDOVER CENTER
57,007
57,007
-
57,007
-
57,007
2003(A)
SOUTHWEST MIXED USE PROPERTY
403,034
1,325,126
306,510
361,035
1,673,635
2,034,670
678,351
1,356,318
2003(A)
NORTH EAST STATION
869,385
-
-
869,385
-
869,385
-
869,385
2007(A)
OWINGS MILLS PLAZA
303,911
1,370,221
86,521
303,911
1,456,742
1,760,653
41,029
1,719,624
2005(A)
PERRY HALL
3,339,309
12,377,339
0
3,339,309
12,377,339
15,716,647
2,535,853
13,180,794
4,998,603
2003(A)
TIMONIUM SHOPPING CENTER
6,000,000
24,282,998
9,882,940
7,331,195
32,834,743
40,165,938
9,095,445
31,070,493
8,554,407
2003(A)
WALDORF BOWL
225,099
739,362
84,327
235,099
813,688
1,048,787
198,681
850,106
2003(A)
WALDORF FIRESTONE
57,127
221,621
(0)
57,127
221,621
278,749
55,903
222,846
2003(A)
BANGOR, ME
403,833
1,622,331
93,752
403,833
1,716,083
2,119,916
263,140
1,856,776
2001(A)
MALLSIDE PLAZA
6,930,996
17,790,780
(0)
6,930,996
17,790,779
24,721,776
904,072
23,817,703
15,223,681
2007(A)
CLAWSON
1,624,771
6,578,142
4,928,616
1,624,771
11,506,758
13,131,529
3,104,655
10,026,874
1993(A)
WHITE LAKE
2,300,050
9,249,607
2,174,315
2,300,050
11,423,922
13,723,972
3,223,343
10,500,629
1996(A)
CANTON TWP PLAZA
163,740
926,150
5,168,945
163,740
6,095,094
6,258,835
28,407
6,230,428
2005(A)
CLINTON TWP PLAZA
175,515
714,279
1,192,626
175,515
1,906,904
2,082,419
78,432
2,003,987
2005(A)
DEARBORN HEIGHTS PLAZA
162,319
497,791
(59,558)
135,889
464,664
600,553
16,265
584,288
2005(A)
FARMINGTON
1,098,426
4,525,723
3,068,085
1,098,426
7,593,808
8,692,234
2,325,913
6,366,321
1993(A)
LIVONIA
178,785
925,818
833,249
178,785
1,759,067
1,937,852
830,515
1,107,337
1968(C)
MUSKEGON
391,500
958,500
825,035
391,500
1,783,535
2,175,035
1,513,808
661,227
1985(A)
OKEMOS PLAZA
166,706
591,193
451,362
166,706
1,042,555
1,209,261
11,075
1,198,186
911,702
2005(A)
TAYLOR
1,451,397
5,806,263
275,289
1,451,397
6,081,552
7,532,949
2,173,110
5,359,839
1993(A)
WALKER
3,682,478
14,730,060
2,025,130
3,682,478
16,755,190
20,437,668
5,733,755
14,703,913
1993(A)
EDEN PRAIRIE PLAZA
882,596
911,373
514,690
882,596
1,426,063
2,308,659
25,212
2,283,446
2005(A)
FOUNTAINS AT ARBOR LAKES
28,585,296
66,699,024
6,042,830
28,585,296
72,741,854
101,327,150
2,222,384
99,104,766
2006(A)
ROSEVILLE PLAZA
132,842
957,340
3,453,338
132,842
4,410,678
4,543,520
19,734
4,523,786
2005(A)
ST. PAUL PLAZA
699,916
623,966
170,050
699,916
794,016
1,493,932
15,789
1,478,143
2005(A)
BRIDGETON
-
2,196,834
(0)
2,196,834
2,196,834
577,403
1,619,430
1997(A)
126
INITIAL COST
PROPERTIES
LAND
BUILDING & IMPROVEMENT
SUBSEQUENT TO ACQUISITION
LAND
BUILDING & IMPROVEMENT
TOTAL
ACCUMULATED DEPRECIATION
TOTAL COST, NET OF ACCUMULATED DEPRECIATION
ENCUMBRANCES
DATE OF CONSTRUCTION(C) ACQUISITION(A)
CREVE COEUR, WOODCREST/OLIVE
1,044,598
5,475,623
615,905
960,814
6,175,312
7,136,126
1,471,960
5,664,166
1998(A)
CRYSTAL CITY, MI
-
234,378
0
234,378
234,378
55,229
179,150
1997(A)
INDEPENDENCE, NOLAND DR.
1,728,367
8,951,101
130,980
1,731,300
9,079,148
10,810,448
2,182,305
8,628,143
1998(A)
NORTH POINT SHOPPING CENTER
1,935,380
7,800,746
243,325
1,935,380
8,044,071
9,979,451
1,852,459
8,126,992
6,779,531
1998(A)
KIRKWOOD
-
9,704,005
10,669,791
��
20,373,796
20,373,796
5,618,555
14,755,241
1998(A)
KANSAS CITY
574,777
2,971,191
274,976
574,777
3,246,167
3,820,944
825,346
2,995,597
1997(A)
LEMAY
125,879
503,510
3,387,305
451,155
3,565,540
4,016,694
676,113
3,340,581
1974(C)
GRAVOIS
1,032,416
4,455,514
10,868,529
1,032,413
15,324,046
16,356,459
6,308,328
10,048,131
1972(C)
ST. CHARLES-UNDERDEVELOPED LAND, MO
431,960
-
758,854
431,960
758,855
1,190,814
132,273
1,058,542
1998(A)
SPRINGFIELD
2,745,595
10,985,778
5,386,434
2,904,022
16,213,785
19,117,807
4,689,256
14,428,552
1994(A)
KMART PARCEL
905,674
3,666,386
4,933,942
905,674
8,600,328
9,506,001
1,153,425
8,352,577
2,536,706
2002(A)
KRC ST. CHARLES
-
550,204
-
550,204
550,204
126,970
423,234
1998(A)
ST. LOUIS, CHRISTY BLVD.
809,087
4,430,514
1,599,193
809,087
6,029,706
6,838,794
1,267,216
5,571,578
1998(A)
OVERLAND
-
4,928,677
723,008
5,651,686
5,651,686
1,406,189
4,245,497
1997(A)
ST. LOUIS
-
5,756,736
824,684
6,581,420
6,581,420
1,622,105
4,959,315
1997(A)
ST. LOUIS
-
2,766,644
118,298
2,884,942
2,884,942
743,756
2,141,186
1997(A)
ST. PETERS
1,182,194
7,423,459
7,008,779
1,053,694
14,560,738
15,614,432
5,409,640
10,204,791
1997(A)
SPRINGFIELD,GLENSTONE AVE.
-
608,793
1,734,043
2,342,836
2,342,836
437,155
1,905,681
1998(A)
KDI-TURTLE CREEK
11,535,281
-
32,618,109
10,347,014
33,806,376
44,153,390
-
44,153,390
30,687,655
2004(C)
BURLINGTON COMMERCE PARK
924,385
-
(0)
924,385
-
924,385
-
924,385
2003(C)
CHARLOTTE
919,251
3,570,981
1,056,129
919,251
4,627,110
5,546,361
1,443,164
4,103,198
1995(A)
CHARLOTTE
1,783,400
7,139,131
967,863
1,783,400
8,106,994
9,890,394
2,800,617
7,089,777
1993(A)
TYVOLA RD.
-
4,736,345
5,560,696
10,297,041
10,297,041
5,936,536
4,360,505
1986(A)
CROSSROADS PLAZA
767,864
3,098,881
34,566
767,864
3,133,447
3,901,310
604,103
3,297,208
2000(A)
KIMCO CARY 696, INC.
2,180,000
8,756,865
438,422
2,256,799
9,118,489
11,375,287
2,242,421
9,132,867
1998(A)
DURHAM
1,882,800
7,551,576
1,602,386
1,882,800
9,153,962
11,036,762
2,588,199
8,448,563
1996(A)
HILLSBOROUGH CROSSING
519,395
-
(0)
519,395
-
519,395
-
519,395
2003(A)
SHOPPES AT MIDWAY PLANTATION
6,681,212
-
27,543,792
6,393,384
27,831,620
34,225,004
-
34,225,004
27,604,642
2005(C)
PARK PLACE
5,388,573
15,046,669
-
5,388,573
15,046,669
20,435,242
315,822
20,119,420
13,821,500
2007(A)
MOORESVILLE CROSSING
12,013,727
30,604,173
-
12,013,727
30,604,173
42,617,900
420,992
42,196,908
2007(A)
RALEIGH
5,208,885
20,885,792
10,312,844
5,208,885
31,198,636
36,407,521
8,471,464
27,936,057
1993(A)
WAKEFIELD COMMONS II
6,506,450
-
(2,792,179)
2,357,636
1,356,635
3,714,271
-
3,714,271
2001(C)
WAKEFIELD CROSSINGS
3,413,932
-
(2,646,147)
591,362
176,423
767,785
-
767,785
2001(C)
EDGEWATER PLACE
3,150,000
-
10,125,019
3,062,768
10,212,251
13,275,019
-
13,275,019
11,113,298
2003(C)
WINSTON-SALEM
540,667
719,655
5,064,519
540,667
5,784,174
6,324,841
2,447,548
3,877,293
1969(C)
SORENSON PARK PLAZA
5,104,294
-
33,027,392
4,322,887
33,808,799
38,131,686
-
38,131,686
2005(C)
NEW LONDON CENTER
4,323,827
10,088,930
1,209,241
4,323,827
11,298,171
15,621,998
875,178
14,746,820
2005(A)
ROCKINGHAM
2,660,915
10,643,660
10,601,976
2,660,915
21,245,636
23,906,551
6,118,269
17,788,281
1994(A)
BRIDGEWATER NJ
1,982,481
(3,666,959)
9,067,382
1,982,481
5,400,423
7,382,904
2,524,620
4,858,284
1998(C)
BAYONNE BROADWAY
1,434,737
3,347,719
2,801,384
1,434,737
6,149,103
7,583,840
558,617
7,025,223
2004(A)
BRICKTOWN PLAZA
344,884
1,008,941
0
344,884
1,008,941
1,353,826
29,050
1,324,775
2005(A)
BRIDGEWATER PLAZA
350,705
1,361,524
378,545
350,705
1,740,069
2,090,774
36,161
2,054,613
2005(A)
CHERRY HILL
2,417,583
6,364,094
1,568,097
2,417,583
7,932,192
10,349,774
4,878,635
5,471,139
1985(C)
MARLTON PIKE
-
4,318,534
26,942
4,345,476
4,345,476
1,254,959
3,090,517
1996(A)
CINNAMINSON
652,123
2,608,491
2,899,696
652,123
5,508,187
6,160,310
1,558,817
4,601,493
1996(A)
DEBTFORD PLAZA
930,785
4,384,110
(0)
930,785
4,384,110
5,314,895
20,590
5,294,305
2007(A)
HILLSBOROUGH
11,886,809
-
(6,880,755)
5,006,054
-
5,006,054
-
5,006,054
2001(C)
HOLMDEL TOWNE CENTER
10,824,624
43,301,494
2,647,505
10,824,624
45,948,999
56,773,622
5,699,386
51,074,237
2002(A)
HOLMDEL COMMONS
16,537,556
38,759,952
3,680,128
16,537,556
42,440,081
58,977,637
5,429,641
53,547,996
2004(A)
HOWELL PLAZA
311,384
1,143,159
3,278,109
311,384
4,421,268
4,732,652
32,321
4,700,331
2005(A)
KENVILLE PLAZA
385,907
1,209,864
94
385,907
1,209,958
1,595,865
59,821
1,536,044
2005(A)
STRAUSS DISCOUNT AUTO
1,225,294
91,203
1,528,656
1,228,794
1,616,358
2,845,153
182,653
2,662,500
2002(A)
NORTH BRUNSWICK
3,204,978
12,819,912
14,244,130
3,204,978
27,064,042
30,269,020
7,759,999
22,509,021
1994(A)
PISCATAWAY TOWN CENTER
3,851,839
15,410,851
419,006
3,851,839
15,829,857
19,681,696
3,849,224
15,832,472
1998(A)
RIDGEWOOD
450,000
2,106,566
991,591
450,000
3,098,157
3,548,157
902,324
2,645,833
1993(A)
SEA GIRT PLAZA
457,039
1,308,010
173,911
457,039
1,481,921
1,938,960
33,994
1,904,966
2005(A)
UNION CRESCENT
7,895,483
3,010,640
-
7,895,483
3,010,640
10,906,123
-
10,906,123
2007(A)
WESTMONT
601,655
2,404,604
9,803,117
601,655
12,207,721
12,809,376
3,192,240
9,617,135
1994(A)
WEST LONG BRANCH PLAZA
64,976
1,700,782
217,384
64,976
1,918,167
1,983,142
9,021
1,974,121
2005(A)
SYCAMORE PLAZA
1,404,443
5,613,270
258,750
1,404,443
5,872,020
7,276,463
1,541,780
5,734,683
1998(A)
PLAZA PASEO DEL-NORTE
4,653,197
18,633,584
512,766
4,653,197
19,146,349
23,799,547
4,714,789
19,084,758
1998(A)
JUAN TABO, ALBUQUERQUE
1,141,200
4,566,817
293,273
1,141,200
4,860,090
6,001,290
1,163,052
4,838,238
1998(A)
COMP USA CENTER
2,581,908
5,798,092
401,504
2,581,908
6,199,596
8,781,504
2,186,257
6,595,247
3,499,647
2006(A)
DEL MONTE PLAZA
2,489,429
5,590,415
414,612
2,489,429
6,005,027
8,494,457
502,830
7,991,627
4,615,018
2006(A)
D'ANDREA MARKETPLACE
11,556,067
29,435,364
-
11,556,067
29,435,364
40,991,432
507,119
40,484,312
16,783,162
2007(A)
KEY BANK BUILDING
1,500,000
40,486,755
-
1,500,000
40,486,755
41,986,755
2,672,693
39,314,062
31,930,212
2006(A)
BRIDGEHAMPTON
1,811,752
3,107,232
23,469,329
1,858,188
26,530,124
28,388,313
11,512,133
16,876,180
1972(C)
TWO GUYS AUTO GLASS
105,497
436,714
-
105,497
436,714
542,211
53,186
489,025
2003(A)
GENOVESE DRUG STORE
564,097
2,268,768
-
564,097
2,268,768
2,832,865
276,746
2,556,119
2003(A)
KINGS HIGHWAY
2,743,820
6,811,268
1,346,027
2,743,820
8,157,294
10,901,115
928,960
9,972,154
2,795,655
2004(A)
HOMEPORT-RALPH AVENUE
4,414,466
11,339,857
3,077,009
4,414,467
14,416,867
18,831,333
1,319,143
17,512,190
6,108,899
2004(A)
BAYRIDGE
2,569,768
6,251,197
6,172,414
2,569,768
12,423,611
14,993,378
1,077,115
13,916,264
3,950,314
2004(A)
BELLMORE
1,272,269
3,183,547
381,803
1,272,269
3,565,350
4,837,619
390,480
4,447,138
868,270
2004(A)
127
INITIAL COST
PROPERTIES
LAND
BUILDING & IMPROVEMENT
SUBSEQUENT TO ACQUISITION
LAND
BUILDING & IMPROVEMENT
TOTAL
ACCUMULATED DEPRECIATION
TOTAL COST, NET OF ACCUMULATED DEPRECIATION
ENCUMBRANCES
DATE OF CONSTRUCTION(C) ACQUISITION(A)
STRAUSS CASTLE HILL PLAZA
310,864
725,350
241,828
310,864
967,178
1,278,042
72,156
1,205,886
2005(A)
STRAUSS UTICA AVENUE
347,633
811,144
270,431
347,633
1,081,575
1,429,208
80,691
1,348,517
2005(A)
MARKET AT BAY SHORE
12,359,621
30,707,802
579,806
12,359,621
31,287,609
43,647,229
2,866,108
40,781,121
15,170,254
2006(A)
BARNES AVE & GUN HILL ROAD
6,795,371
-
-
6,795,371
-
6,795,371
-
6,795,371
2007(A)
231 STREET
3,565,239
-
-
3,565,239
-
3,565,239
-
3,565,239
2007(A)
KING KULLEN PLAZA
5,968,082
23,243,404
992,102
5,980,130
24,223,458
30,203,588
6,426,504
23,777,084
1998(A)
KDI-CENTRAL ISLIP TOWN CENTER
13,733,950
1,266,050
(171,770)
5,088,852
9,739,378
14,828,230
-
14,828,230
9,380,000
2004(C)
PATHMARK SC
6,714,664
17,359,161
412,289
6,714,664
17,771,450
24,486,114
1,017,689
23,468,425
7,392,692
2006(A)
BIRCHWOOD PLAZA COMMACK
3,630,000
4,774,791
-
3,630,000
4,774,791
8,404,791
128,116
8,276,675
2007(A)
ELMONT
3,011,658
7,606,066
2,194,924
3,011,658
9,800,989
12,812,648
1,035,525
11,777,123
3,495,909
2004(A)
FRANKLIN SQUARE
1,078,541
2,516,581
2,631,720
1,078,541
5,148,301
6,226,842
461,341
5,765,500
2004(A)
KISSENA BOULEVARD SC
11,610,000
2,933,487
-
11,610,000
2,933,487
14,543,487
274,074
14,269,413
2007(A)
HAMPTON BAYS
1,495,105
5,979,320
490,491
1,495,105
6,469,811
7,964,916
3,492,805
4,472,111
1989(A)
HICKSVILLE
3,542,739
8,266,375
1,080,379
3,542,739
9,346,754
12,889,493
1,001,764
11,887,729
2004(A)
100 WALT WHITMAN ROAD
5,300,000
8,167,577
-
5,300,000
8,167,577
13,467,577
221,153
13,246,424
2007(A)
BP AMOCO GAS STATION
1,110,593
-
-
1,110,593
-
1,110,593
-
1,110,593
2007(A)
STRAUSS LIBERTY AVENUE
305,969
713,927
238,695
305,969
952,623
1,258,591
70,326
1,188,265
2005(A)
BIRCHWOOD PLAZA (NORTH & SOUTH)
12,368,330
33,071,495
-
12,368,330
33,071,495
45,439,825
570,761
44,869,064
2007(A)
501 NORTH BROADWAY
-
1,175,543
-
1,175,543
1,175,543
19,235
1,156,308
2007(A)
MERRYLANE (P/L)
1,485,531
1,749
0
1,485,531
1,749
1,487,280
15
1,487,265
2007(A)
DOUGLASTON SHOPPING CENTER
3,277,254
13,161,218
145,677
3,277,253
13,306,895
16,584,148
1,609,845
14,974,303
2003(A)
STRAUSS MERRICK BLVD
450,582
1,051,359
351,513
450,582
1,402,872
1,853,454
104,662
1,748,792
2005(A)
MANHASSET VENTURE LLC
4,567,003
19,165,808
25,755,087
4,421,939
45,065,959
49,487,898
8,776,077
40,711,821
1999(A)
MASPETH QUEENS-DUANE READE
1,872,013
4,827,940
931,187
1,872,013
5,759,126
7,631,139
575,149
7,055,990
2,777,571
2004(A)
MASSAPEQUA
1,880,816
4,388,549
959,261
1,880,816
5,347,810
7,228,626
627,389
6,601,237
2004(A)
STRAUSS EAST 14TH STREET
1,455,653
3,396,523
1,129,302
1,455,653
4,525,825
5,981,478
333,941
5,647,537
2005(A)
BIRCHWOOD PARK DRIVE (LAND LOT)
3,507,162
4,126
0
3,507,162
4,126
3,511,289
34
3,511,254
2007(A)
367-369 BLEEKER STREET
1,425,000
4,958,097
(3,872,769)
506,164
2,004,164
2,510,328
111,519
2,398,809
2004(A)
92 PERRY STREET
2,106,250
6,318,750
(2,131,509)
1,097,200
5,196,291
6,293,491
289,406
6,004,085
2005(A)
82 CHRISTOPHER STREET
972,813
2,974,676
259,166
925,000
3,281,654
4,206,654
178,934
4,027,720
3,049,816
2005(A)
387 BLEEKER STREET
925,000
3,056,933
0
925,000
3,056,933
3,981,933
146,484
3,835,450
2,960,000
2006(A)
19 GREENWICH STREET
1,262,500
3,930,801
121,754
1,262,500
4,052,555
5,315,055
135,172
5,179,883
4,038,855
2006(A)
PREF. EQUITY 100 VANDAM
5,125,000
16,143,321
145,288
6,384,561
15,029,049
21,413,610
497,260
20,916,349
16,400,000
2006(A)
PREF. EQUITY-30 WEST 21ST STREET
6,250,000
21,974,274
-
6,250,000
21,974,274
28,224,274
-
28,224,274
19,199,579
2007(A)
MINEOLA SC
4,150,000
7,520,692
-
4,150,000
7,520,692
11,670,692
205,259
11,465,433
2007(A)
4452 BROADWAY
12,412,724
-
-
12,412,724
-
12,412,724
-
12,412,724
2007(A)
AMERICAN MUFFLER SHOP
76,056
325,567
-
76,056
325,567
401,624
39,582
362,042
2003(A)
PLAINVIEW
263,693
584,031
9,737,514
263,693
10,321,545
10,585,238
4,089,037
6,496,200
1969(C)
POUGHKEEPSIE
876,548
4,695,659
12,637,100
876,548
17,332,759
18,209,307
6,929,012
11,280,296
1972(C)
STRAUSS JAMAICA AVENUE
1,109,714
2,589,333
596,178
1,109,714
3,185,511
4,295,225
235,096
4,060,129
2005(A)
SYOSSET, NY
106,655
76,197
1,503,476
106,655
1,579,673
1,686,328
786,464
899,864
1990(C)
STATEN ISLAND
2,280,000
9,027,951
5,166,389
2,280,000
14,194,340
16,474,340
7,058,656
9,415,683
1989(A)
STATEN ISLAND
2,940,000
11,811,964
1,044,562
3,148,424
12,648,101
15,796,526
3,212,197
12,584,329
214,251
1997(A)
STATEN ISLAND PLAZA
5,600,744
6,788,460
452,440
5,600,744
7,240,900
12,841,644
63,076
12,778,568
2005(A)
HYLAN PLAZA
28,723,536
38,232,267
33,443,707
28,723,536
71,675,975
100,399,510
8,726,195
91,673,316
2006(A)
STOP N SHOP STATEN ISLAND
4,558,592
10,441,408
155,848
4,558,592
10,597,256
15,155,848
1,499,317
13,656,531
2005(A)
WEST GATES
1,784,718
9,721,970
(1,936,030)
1,784,718
7,785,940
9,570,658
4,128,016
5,442,642
1993(A)
WHITE PLAINS
1,777,775
4,453,894
2,008,106
1,777,775
6,462,000
8,239,774
808,953
7,430,822
3,515,132
2004(A)
YONKERS
871,977
3,487,909
-
871,977
3,487,909
4,359,886
1,310,301
3,049,585
1998(A)
STRAUSS ROMAINE AVENUE
782,459
1,825,737
610,420
782,459
2,436,158
3,218,616
181,751
3,036,866
2005(A)
AKRON WATERLOO
437,277
1,912,222
4,131,997
437,277
6,044,219
6,481,496
2,543,877
3,937,618
1975(C)
WEST MARKET ST.
560,255
3,909,430
379,484
560,255
4,288,914
4,849,169
2,422,916
2,426,253
1999(A)
BARBERTON
505,590
1,948,135
3,326,621
505,590
5,274,756
5,780,346
2,582,667
3,197,679
1972(C)
BRUNSWICK
771,765
6,058,560
2,090,329
771,765
8,148,889
8,920,654
5,822,765
3,097,890
1975(C)
BEAVERCREEK
635,228
3,024,722
3,038,568
635,228
6,063,290
6,698,518
4,177,867
2,520,651
1986(A)
CANTON
792,985
1,459,031
4,695,392
792,985
6,154,423
6,947,408
4,078,203
2,869,205
1972(C)
CAMBRIDGE
-
1,848,195
983,853
473,060
2,358,988
2,832,048
2,012,367
819,681
1973(C)
MORSE RD.
835,386
2,097,600
2,755,844
835,386
4,853,445
5,688,830
2,692,701
2,996,129
1988(A)
HAMILTON RD.
856,178
2,195,520
3,844,830
856,178
6,040,351
6,896,528
3,191,597
3,704,932
1988(A)
OLENTANGY RIVER RD.
764,517
1,833,600
2,340,830
764,517
4,174,430
4,938,947
2,765,134
2,173,813
1988(A)
W. BROAD ST.
982,464
3,929,856
3,177,920
969,804
7,120,436
8,090,240
3,702,975
4,387,266
1988(A)
RIDGE ROAD
1,285,213
4,712,358
10,599,832
1,285,213
15,312,190
16,597,403
4,221,783
12,375,620
1992(A)
GLENWAY AVE
530,243
3,788,189
527,010
530,243
4,315,198
4,845,441
2,532,434
2,313,007
1999(A)
SPRINGDALE
3,205,653
14,619,732
4,814,341
3,205,653
19,434,073
22,639,726
8,965,719
13,674,007
1992(A)
GLENWAY CROSSING
699,359
3,112,047
1,232,339
699,359
4,344,386
5,043,745
718,376
4,325,369
2000(A)
HIGHLAND RIDGE PLAZA
1,540,000
6,178,398
141,991
1,540,000
6,320,389
7,860,389
1,306,833
6,553,556
1999(A)
HIGHLAND PLAZA
702,074
667,463
76,380
702,074
743,843
1,445,917
21,136
1,424,781
2005(A)
MONTGOMERY PLAZA
530,893
1,302,656
1,156,315
530,893
2,458,971
2,989,864
37,625
2,952,240
2005(A)
SHILOH SPRING RD.
-
1,735,836
3,283,247
1,105,183
3,913,901
5,019,083
2,573,513
2,445,570
1969(C)
OAKCREEK
1,245,870
4,339,637
3,965,637
1,245,871
8,305,273
9,551,144
5,148,030
4,403,113
1984(A)
SALEM AVE.
665,314
347,818
5,443,143
665,314
5,790,961
6,456,275
2,899,152
3,557,123
1988(A)
KETTERING
1,190,496
4,761,984
681,243
1,190,496
5,443,227
6,633,723
3,135,113
3,498,610
1988(A)
KENT, OH
6,254
3,028,914
-
6,254
3,028,914
3,035,168
1,479,908
1,555,260
1999(A)
128
INITIAL COST
PROPERTIES
LAND
BUILDING & IMPROVEMENT
SUBSEQUENT TO ACQUISITION
LAND
BUILDING & IMPROVEMENT
TOTAL
ACCUMULATED DEPRECIATION
TOTAL COST, NET OF ACCUMULATED DEPRECIATION
ENCUMBRANCES
DATE OF CONSTRUCTION(C) ACQUISITION(A)
KENT
2,261,530
-
0
2,261,530
-
2,261,530
-
2,261,530
1995(A)
MENTOR
503,981
2,455,926
2,258,691
371,295
4,847,303
5,218,598
2,324,413
2,894,185
1987(A)
MIDDLEBURG HEIGHTS
639,542
3,783,096
29,683
639,542
3,812,779
4,452,321
2,139,842
2,312,479
1999(A)
MENTOR ERIE COMMONS.
2,234,474
9,648,000
5,305,316
2,234,474
14,953,316
17,187,790
6,624,657
10,563,133
1988(A)
MALLWOODS CENTER
294,232
-
1,184,543
294,232
1,184,543
1,478,775
157,195
1,321,580
1999(C)
NORTH OLMSTED
626,818
3,712,045
35,000
626,818
3,747,045
4,373,862
2,057,245
2,316,617
1999(A)
ORANGE OHIO
3,783,875
-
(2,449,086)
921,704
413,085
1,334,789
-
1,334,789
2001(C)
UPPER ARLINGTON
504,256
2,198,476
8,944,129
1,255,544
10,391,317
11,646,861
6,438,878
5,207,983
1969(C)
WICKLIFFE
610,991
2,471,965
1,405,293
610,991
3,877,258
4,488,249
1,171,702
3,316,547
1995(A)
CHARDON ROAD
481,167
5,947,751
2,154,396
481,167
8,102,146
8,583,314
3,348,540
5,234,774
1999(A)
WESTERVILLE
1,050,431
4,201,616
8,085,028
1,050,431
12,286,644
13,337,075
5,194,819
8,142,256
1988(A)
EDMOND
477,036
3,591,493
8,900
477,036
3,600,393
4,077,429
911,628
3,165,802
1997(A)
CENTENNIAL PLAZA
4,650,634
18,604,307
1,230,555
4,650,634
19,834,862
24,485,496
5,078,854
19,406,643
1998(A)
KDI-MCMINNVILLE
4,062,327
-
106,699
4,062,327
106,699
4,169,026
-
4,169,026
2006(C)
ALLEGHENY
-
30,061,177
59,094
30,120,271
30,120,271
2,662,524
27,457,747
2004(A)
SUBURBAN SQUARE
70,679,871
166,351,381
-
70,679,871
166,351,381
237,031,252
4,595,734
232,435,518
117,000,000
2007(A)
CHIPPEWA
2,881,525
11,526,101
153,289
2,881,525
11,679,391
14,560,916
2,382,074
12,178,842
9,542,228
2000(A)
BROOKHAVEN PLAZA
254,694
973,318
128,835
254,694
1,102,152
1,356,847
21,217
1,335,630
2005(A)
CARNEGIE
-
3,298,908
17,747
3,316,655
3,316,655
680,340
2,636,316
1999(A)
CENTER SQUARE
731,888
2,927,551
1,236,799
731,888
4,164,351
4,896,238
1,292,196
3,604,043
1996(A)
WAYNE PLAZA
6,036,818
15,373,763
-
6,036,818
15,373,763
21,410,581
30,911
21,379,670
14,288,894
2007(A)
CHAMBERSBURG CROSSING
9,090,288
-
25,035,574
9,090,288
25,035,574
34,125,863
-
34,125,863
2006(C)
EAST STROUDSBURG
1,050,000
2,372,628
1,243,804
1,050,000
3,616,432
4,666,432
2,810,817
1,855,615
1973(C)
EXTON
176,666
4,895,360
-
176,666
4,895,360
5,072,026
1,004,177
4,067,850
1999(A)
EXTON
731,888
2,927,551
0
731,888
2,927,551
3,659,439
850,742
2,808,697
1996(A)
EASTWICK
889,001
2,762,888
3,074,728
889,001
5,837,616
6,726,617
1,522,603
5,204,015
4,319,275
1997(A)
EXTON PLAZA
294,378
1,404,778
1,098,708
294,378
2,503,485
2,797,864
24,081
2,773,782
2005(A)
FEASTERVILLE
520,521
2,082,083
180,786
520,521
2,262,869
2,783,390
603,487
2,179,903
1996(A)
GETTYSBURG
74,626
671,630
101,519
74,626
773,149
847,775
746,036
101,738
1986(A)
HARRISBURG, PA
452,888
6,665,238
3,955,034
452,888
10,620,272
11,073,160
5,376,209
5,696,951
2002(A)
HAMBURG
439,232
-
2,023,428
494,982
1,967,677
2,462,660
290,559
2,172,101
2,410,388
2000(C)
HAVERTOWN
731,888
2,927,551
0
731,888
2,927,551
3,659,439
850,742
2,808,697
1996(A)
NORRISTOWN
686,134
2,664,535
3,355,299
774,084
5,931,884
6,705,968
3,717,759
2,988,209
1984(A)
NEW KENSINGTON
521,945
2,548,322
676,040
521,945
3,224,362
3,746,307
2,823,486
922,821
1986(A)
PHILADELPHIA
731,888
2,927,551
0
731,888
2,927,551
3,659,439
850,742
2,808,697
1996(A)
GALLERY, PHILADELPHIA PA
-
-
2,464,780
2,464,780
2,464,780
10,231
2,454,549
1996(A)
PHILADELPHIA PLAZA
209,197
1,373,843
219,383
209,197
1,593,226
1,802,423
49,680
1,752,742
2005(A)
STRAUSS WASHINGTON AVENUE
424,659
990,872
468,821
424,659
1,459,693
1,884,352
108,960
1,775,392
2005(A)
35 NORTH 3RD LLC
451,789
3,089,294
-
451,789
3,089,294
3,541,083
73
3,541,010
2007(A)
1628 WALNUT STREET
912,686
2,747,260
-
912,686
2,747,260
3,659,946
-
3,659,946
2007(A)
1701 WALNUT STREET
3,066,099
9,558,521
-
3,066,099
9,558,521
12,624,620
-
12,624,620
2007(A)
120-122 MARKET STREET
752,309
2,707,474
-
752,309
2,707,474
3,459,783
-
3,459,783
2007(A)
242-244 MARKET STREET
704,263
2,117,182
-
704,263
2,117,182
2,821,445
-
2,821,445
2007(A)
1401 WALNUT ST LOWER ESTATE
2,709,288
50,921,269
-
2,709,288
50,921,269
53,630,557
413,377
53,217,179
2007(A)
1831-33 CHESTNUT STREET
1,982,143
5,982,231
-
1,982,143
5,982,231
7,964,374
-
7,964,374
2007(A)
RICHBORO
788,761
3,155,044
11,831,096
976,439
14,798,461
15,774,901
6,976,831
8,798,070
1986(A)
SPRINGFIELD
919,998
4,981,589
1,687,914
920,000
6,669,501
7,589,501
4,895,752
2,693,749
1983(A)
UPPER DARBY
231,821
927,286
5,070,766
231,821
5,998,052
6,229,873
1,505,956
4,723,917
3,393,715
1996(A)
WEST MIFFLIN
1,468,341
-
1
1,468,342
-
1,468,342
-
1,468,342
1986(A)
WHITEHALL
-
5,195,577
0
5,195,577
5,195,577
1,509,827
3,685,751
1996(A)
E. PROSPECT ST.
604,826
2,755,314
427,188
604,826
3,182,502
3,787,328
2,887,495
899,833
1986(A)
W. MARKET ST.
188,562
1,158,307
0
188,562
1,158,307
1,346,869
1,158,307
188,562
1986(A)
REXVILLE TOWN CENTER
24,872,982
48,688,161
6,018,321
25,678,064
53,901,400
79,579,464
3,688,668
75,890,796
41,981,198
2006(A)
PLAZA CENTRO - COSTCO
3,627,973
10,752,213
1,562,235
3,866,206
12,076,214
15,942,420
1,831,247
14,111,173
2006(A)
PLAZA CENTRO - MALL
19,873,263
58,719,179
6,196,564
19,655,368
65,133,637
84,789,005
9,882,875
74,906,130
2006(A)
PLAZA CENTRO - RETAIL
5,935,566
16,509,748
2,096,753
6,026,070
18,515,997
24,542,067
2,809,261
21,732,806
2006(A)
PLAZA CENTRO - SAM'S CLUB
6,643,224
20,224,758
2,372,321
6,520,090
22,720,213
29,240,303
5,114,493
24,125,810
2006(A)
LOS COLOBOS - BUILDERS SQUARE
4,404,593
9,627,903
1,443,721
4,461,145
11,015,073
15,476,218
1,561,916
13,914,301
2006(A)
LOS COLOBOS - KMART
4,594,944
10,120,147
767,917
4,402,338
11,080,670
15,483,008
1,630,195
13,852,812
2006(A)
LOS COLOBOS I
12,890,882
26,046,669
3,262,438
13,613,375
28,586,614
42,199,990
4,042,323
38,157,666
2006(A)
LOS COLOBOS II
14,893,698
30,680,556
3,290,802
15,142,301
33,722,756
48,865,057
4,786,348
44,078,709
2006(A)
WESTERN PLAZA - MAYAQUEZ ONE
10,857,773
12,252,522
1,190,961
11,241,993
13,059,264
24,301,257
1,520,496
22,780,760
2006(A)
WESTERN PLAZA - MAYAGUEZ TWO
16,874,345
19,911,045
1,268,584
16,872,647
21,181,327
38,053,975
2,853,010
35,200,964
18,282,334
2006(A)
MANATI VILLA MARIA SC
2,781,447
5,673,119
445,477
2,626,895
6,273,147
8,900,042
1,942,634
6,957,409
5,036,244
2006(A)
PONCE TOWN CENTER
14,432,778
28,448,754
3,771,196
15,151,981
31,500,747
46,652,729
1,762,174
44,890,555
24,481,039
2006(A)
TRUJILLO ALTO PLAZA
12,053,673
24,445,858
3,016,008
12,507,048
27,008,492
39,515,540
3,738,353
35,777,187
14,518,562
2006(A)
MARSHALL PLAZA, CRANSTON RI
1,886,600
7,575,302
1,150,982
1,886,600
8,726,284
10,612,884
2,223,515
8,389,369
1998(A)
CHARLESTON
730,164
3,132,092
5,484,188
730,164
8,616,280
9,346,444
3,526,251
5,820,193
1978(C)
CHARLESTON
1,744,430
6,986,094
4,058,531
1,744,430
11,044,625
12,789,055
3,097,449
9,691,606
1995(A)
FLORENCE
1,465,661
6,011,013
124,756
1,465,661
6,135,769
7,601,430
1,618,832
5,982,598
1997(A)
GREENVILLE
2,209,812
8,850,864
2,829,140
2,209,811
11,680,005
13,889,816
2,566,632
11,323,184
1997(A)
NORTH CHARLESTON
744,093
2,974,990
146,365
744,093
3,121,355
3,865,447
590,903
3,274,544
1,709,996
2000(A)
N. CHARLESTON
2,965,748
11,895,294
1,229,638
2,965,748
13,124,931
16,090,680
3,136,940
12,953,740
1997(A)
129
INITIAL COST
PROPERTIES
LAND
BUILDING & IMPROVEMENT
SUBSEQUENT TO ACQUISITION
LAND
BUILDING & IMPROVEMENT
TOTAL
ACCUMULATED DEPRECIATION
TOTAL COST, NET OF ACCUMULATED DEPRECIATION
ENCUMBRANCES
DATE OF CONSTRUCTION(C) ACQUISITION(A)
KDI-HARPETH VILLAGE SC
4,119,997
-
8,926,435
2,920,692
10,125,739
13,046,432
-
13,046,432
11,974,591
2006(C)
MADISON
-
4,133,904
2,758,407
6,892,311
6,892,311
4,790,383
2,101,928
1978(C)
HICKORY RIDGE COMMONS
596,347
2,545,033
21,750
596,347
2,566,783
3,163,130
490,506
2,672,624
2000(A)
TROLLEY STATION
3,303,682
13,218,740
61,300
3,303,682
13,280,040
16,583,722
3,140,519
13,443,203
9,767,454
1998(A)
RIVERGATE STATION
7,135,070
19,091,078
1,995,066
7,135,070
21,086,144
28,221,214
4,124,616
24,096,598
15,242,004
2004(A)
MARKET PLACE AT RIVERGATE
2,574,635
10,339,449
1,103,917
2,574,635
11,443,366
14,018,001
2,721,153
11,296,848
1998(A)
RIVERGATE, TN
3,038,561
12,157,408
3,045,869
3,038,561
15,203,277
18,241,838
3,350,266
14,891,572
1998(A)
CENTER OF THE HILLS, TX
2,923,585
11,706,145
643,559
2,923,585
12,349,704
15,273,289
2,997,039
12,276,250
1998(A)
ARLINGTON
3,160,203
2,285,377
1
3,160,203
2,285,378
5,445,582
594,954
4,850,628
1997(A)
DOWLEN CENTER
2,244,581
-
(1,041,611)
484,828
718,142
1,202,970
-
1,202,970
2002(C)
BURLESON
9,974,390
810,314
(9,426,038)
1,373,692
(15,026)
1,358,666
-
1,358,666
2000(C)
BAYTOWN
500,422
2,431,651
437,341
500,422
2,868,992
3,369,414
762,582
2,606,833
1996(A)
LAS TIENDAS PLAZA
8,678,107
-
23,626,353
7,943,925
24,360,535
32,304,460
-
32,304,460
2005(C)
CORPUS CHRISTI, TX
-
944,562
3,208,000
4,152,562
4,152,562
680,874
3,471,688
1997(A)
DALLAS
1,299,632
5,168,727
7,434,369
1,299,632
12,603,096
13,902,728
9,283,360
4,619,368
1969(C)
MONTGOMERY PLAZA
6,203,205
-
44,466,582
6,203,205
44,466,582
50,669,787
-
50,669,787
37,097,058
2003(C)
PRESTON LEBANON CROSSING
13,552,180
-
12,954,122
13,552,180
12,954,122
26,506,302
-
26,506,302
2006(C)
KDI-LAKE PRAIRIE TOWN CROSSING
7,897,491
-
22,366,915
7,722,108
22,542,298
30,264,406
-
30,264,406
26,077,888
2006(C)
CENTER AT BAYBROOK
6,941,017
27,727,491
3,965,605
7,063,186
31,570,926
38,634,113
6,969,656
31,664,456
1998(A)
HARRIS COUNTY
1,843,000
7,372,420
1,031,027
2,003,260
8,243,187
10,246,447
2,136,824
8,109,623
1997(A)
SHARPSTOWN COURT
1,560,010
6,245,807
356,379
1,560,010
6,602,186
8,162,196
1,460,083
6,702,113
5,467,177
1999(A)
CYPRESS TOWNE CENTER
6,033,932
-
(3,495,388)
1,405,968
1,132,576
2,538,544
-
2,538,544
2003(C)
SHOPS AT VISTA RIDGE
3,257,199
13,029,416
163,901
3,257,199
13,193,316
16,450,516
3,272,135
13,178,381
16,724,665
1998(A)
VISTA RIDGE PLAZA
2,926,495
11,716,483
1,959,391
2,926,495
13,675,874
16,602,369
3,240,990
13,361,379
1998(A)
VISTA RIDGE PHASE II
2,276,575
9,106,300
92,406
2,276,575
9,198,706
11,475,281
2,153,891
9,321,390
1998(A)
SOUTH PLAINES PLAZA, TX
1,890,000
7,555,099
0
1,890,000
7,555,099
9,445,099
1,934,863
7,510,237
1998(A)
MESQUITE
520,340
2,081,356
752,043
520,340
2,833,400
3,353,739
902,110
2,451,629
1995(A)
MESQUITE TOWN CENTER
3,757,324
15,061,644
1,675,675
3,757,324
16,737,319
20,494,643
4,080,375
16,414,267
1998(A)
NEW BRAUNSFELS
840,000
3,360,000
-
840,000
3,360,000
4,200,000
388,440
3,811,560
2003(A)
KDI-HARMON TOWNE CROSSING
7,815,750
187,300
0
7,815,750
187,300
8,003,050
-
8,003,050
4,944,702
2007(C)
FORUM AT OLYMPIA PARKWAY-DEV
668,781
-
(638,592)
30,189
30,189
-
30,189
1999(C)
PARKER PLAZA
7,846,946
-
0
7,846,946
-
7,846,946
-
7,846,946
2005(C)
PLANO
500,414
2,830,835
0
500,414
2,830,835
3,331,249
811,048
2,520,201
1996(A)
SOUTHLAKE OAKS
3,011,260
7,669,686
-
3,011,260
7,669,686
10,680,946
618,411
10,062,535
6,409,971
2007(A)
WEST OAKS
500,422
2,001,687
26,291
500,422
2,027,978
2,528,400
614,436
1,913,964
1996(A)
MARKET STREET AT WOODLANDS
10,920,168
-
(10,847,110)
-
73,058
73,058
-
73,058
2002(C)
OGDEN
213,818
855,275
4,279,007
850,699
4,497,401
5,348,100
1,528,395
3,819,705
1967(C)
COLONIAL HEIGHTS
125,376
3,476,073
32,420
125,376
3,508,493
3,633,869
722,336
2,911,533
1999(A)
OLD TOWN VILLAGE
4,500,000
41,569,735
-
4,500,000
41,569,735
46,069,735
-
46,069,735
16,467,827
2007(A)
MANASSAS
1,788,750
7,162,661
314,489
1,788,750
7,477,150
9,265,900
1,976,274
7,289,625
1997(A)
RICHMOND
82,544
2,289,288
280,600
82,544
2,569,889
2,652,432
372,197
2,280,235
1999(A)
RICHMOND
670,500
2,751,375
(0)
670,500
2,751,375
3,421,875
888,553
2,533,322
1995(A)
VALLEY VIEW SHOPPING CENTER
3,440,018
8,054,004
733,871
3,440,018
8,787,875
12,227,893
904,775
11,323,118
2004(A)
MANCHESTER SHOPPING CENTER
2,722,461
6,403,866
577,098
2,722,461
6,980,964
9,703,425
1,306,101
8,397,324
2004(A)
AUBURN NORTH
7,785,841
18,157,625
-
7,785,841
18,157,625
25,943,467
728,729
25,214,737
2007(A)
CHARLES TOWN
602,000
3,725,871
10,943,677
602,000
14,669,548
15,271,548
6,900,083
8,371,465
1985(A)
RIVERWALK PLAZA
2,708,290
10,841,674
148,349
2,708,290
10,990,023
13,698,313
2,506,794
11,191,519
1999(A)
BLUE RIDGE
12,346,900
71,529,796
2,345,014
16,906,894
69,314,816
86,221,710
10,902,671
75,319,039
17,380,793
2005(A)
MEXICO-APODACA LAND FUND
5,280,441
-
-
5,280,441
-
5,280,441
-
5,280,441
2007(A)
MEXICO-GIGANTE ACQ
7,568,417
19,878,026
-
7,568,417
19,878,026
27,446,443
623,979
26,822,464
2007(A)
MEXICO-LINDAVISTA
19,352,453
-
19,586,988
19,554,673
19,384,768
38,939,441
-
38,939,441
2006(C)
MEXICO-MAZATLAN MEXICO LAND
12,564,535
-
-
12,564,535
-
12,564,535
-
12,564,535
2007(A)
MEXICO-MOTOROLA
47,272,528
-
23,961,758
47,877,602
23,356,684
71,234,286
-
71,234,286
2006(C)
MEXICO-NON ADM GRAND PLZ CANCUN
13,976,402
35,593,236
-
13,976,402
35,593,236
49,569,638
-
49,569,638
2007(A)
MEXICO-NON ADM LAGO REAL
11,336,743
-
-
11,336,743
-
11,336,743
-
11,336,743
2007(A)
MEXICO-NON ADM LOS CABOS
10,873,070
1,257,517
-
10,873,070
1,257,517
12,130,587
-
12,130,587
2007(A)
MEXICO-NUEVO LAREDO
10,627,540
-
9,302,852
10,867,858
9,062,534
19,930,392
-
19,930,392
2006(C)
MEXICO-PACHUCA WAL-MART
3,621,985
-
6,637,065
3,843,454
6,415,596
10,259,050
567,052
9,691,998
2005(C)
MEXICO-PLAZA CENTENARIO
3,388,861
-
-
3,388,861
-
3,388,861
-
3,388,861
2007(A)
MEXICO-PLAZA SAN JUAN
9,631,035
-
1,244,358
9,664,208
1,211,185
10,875,393
-
10,875,393
2006(C)
MEXICO-PLAZA SORIANA
2,639,975
346,945
-
2,639,975
346,945
2,986,920
-
2,986,920
2007(A)
MEXICO-SALTILLO II
11,150,023
-
18,438,702
11,299,388
18,289,337
29,588,725
1,038,962
28,549,763
2005(C)
MEXICO-SAN PEDRO
3,309,654
13,238,616
(923,452)
4,179,622
11,445,196
15,624,818
349,355
15,275,463
2006(A)
MEXICO-TAPACHULA
13,716,428
-
-
13,716,428
-
13,716,428
-
13,716,428
2007(A)
MEXICO-WALDO ACQ
8,929,278
16,888,627
-
8,929,278
16,888,627
25,817,905
525,015
25,292,890
2007(A)
BALANCE OF PORTFOLIO
133,248,688
4,492,127
60,828,807
136,179,328
62,390,294
198,569,623
20,403,814
178,165,809
-
$ 1,838,959,724
$ 5,486,075,096
$ 7,325,034,820
$ 977,443,829
$ 6,347,590,991
$ 1,084,649,964
130
Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets as follows:
Buildings and building improvements
15 to 50 years
Fixtures, leasehold and tenant improvements
Terms of leases or useful lives, whichever is shorter
(including certain identified intangible assets)
The aggregate cost for Federal income tax purposes was approximately $ 6.6 billion at December 31, 2007.
The changes in total real estate assets for the years ended December 31, 2007, 2006 and 2005, are as follows:
2007
2006
2005
Balance, beginning of period
$ 6,001,319,025
$ 4,560,405,547
$ 4,092,222,479
Acquisitions
1,113,409,534
2,719,840,791
490,125,913
Improvements
497,102,382
505,353,494
410,280,045
Transfers from (to) unconsolidated joint ventures
67,572,307
(1,358,078,215)
(103,573,817)
Sales
(312,051,273)
(421,493,264)
(299,944,373)
Assets held for sale
(33,817,156)
(4,709,328)
(28,704,700)
Adjustment of property carrying values
(8,500,000)
-
-
Balance, end of period
$ 7,325,034,819
$ 6,001,319,025
$ 4,560,405,547
The changes in accumulated depreciation for the years ended December 31, 2007, 2006, 2005, and 2004 are as follows:
2007
2006
2005
Balance, beginning of period
$ 806,670,237
$ 740,127,307
$ 634,641,781
Depreciation for year
171,109,963
138,279,032
98,591,658
Transfers from (to) unconsolidated joint ventures
8,358,844
(331,447)
27,812,350
Sales
(7,474,603)
(69,627,527)
(19,903,904)
Assets held for sale
(1,220,612)
(1,777,128)
(1,014,578)
Balance, end of period
$ 977,443,829
$ 806,670,237
$ 740,127,307
131
KIMCO REALTY CORPORATION AND SUBSIDIARIES
Schedule IV - Mortgage Loans on Real Estate
As of December 31, 2007
(in thousands)
Type of Loan/Borrower
Description
Location (3)
Interest Accrual Rates
Interest Payment Rates
Final Maturity Date
Periodic Payment Terms (1)
Prior Liens
Face Amount of Mortgages or Maximum Available Credit (3)
Carrying Amount of Mortgages (3)(4)
Mortgage Loans:
Borrower A
Retail
Palm Beach, FL
8.00%
8.00%
4/28/2013
I
-
$ 14,500
$ 16,162
Borrower B
Retail
Miami, FL
7.57%
7.57%
6/1/2019
I
-
6,509
4,687
Borrower C
Retail
Acapulco, Mexico
11.75%
11.75%
11/1/2015
I
-
5,723
4,855
Borrower D
Retail
Guadalajara, Mexico
12.00%
12.00%
9/1/2016
I
-
5,307
5,254
Borrower E
Retail
Acapulco, Mexico
10.00%
10.00%
12/1/2016
I
-
9,900
7,654
Borrower F
Retail
Arboledas, Mexico
8.10%
8.10%
12/31/2012
I
-
13,000
13,022
Borrower G
Retail/Office
Guadalajara, Mexico
11.00%
11.00%
2/6/2008 & 2/9/17 (2)
I
-
8,026
7,954
Borrower H
Retail
Toronto, Canada
8.50%
8.5%
10/1/2008
I
-
7,590
5,938
Borrower I
Retail Development
Ontario, Canada
8.50%
8.50%
4/13/2008
I
-
16,906
16,906
Individually < 3%
35,944
29,437
141,405
120,869
Lines of Credit:
Borrower J
Hospital
New York, NY
Libor + 3.25% or Prime +1.75%
Libor + 3.25% or Prime +1.75%
10/19/2012
I
-
18,000
9,000
Borrower K
Medical Center
Bayonne, NJ
Libor + 4%
Libor + 4%
4/17/2009
I
-
30,000
14,737
Borrower L
Retail
Syracuse, NY
Prime +5.5%
Prime +5.5%
4/12/2008
I
-
27,650
12,575
Individually < 3%
-
3,400
2,400
61,050
29,712
Other:
Individually < 3%
-
5,000
2,417
Capitalized loan costs
-
-
849
Total
$ 207,455
$ 153,847
(1) I = interest only
(2) This loan has two traunches maturing in February 2008 and February 2017, respectively
(3) The instruments actual cash flows are denominated in U.S. dollars, Canadian dollars and Mexican pesos as indicated by the geographic location above
(4) The aggregate cost for Federal income tax purposes is $153,847.
For a reconciliation of mortgage and other financing receivables from January 1, 2005 to December 31, 2007 see Note 9 of the Notes to Consolidated Financial Statements included in this annual report of Form 10-K.
132
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