UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2002

Commission File No. 001-13499

EQUITY ONE, INC.
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)

1696 N.E. MIAMI GARDENS DRIVE
N. MIAMI BEACH, FLORIDA 33179
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(Address of Principal Executive Offices)

(305) 947-1664
- --------------------------------------------------------------------------------
(Issuer's Telephone Number, Including Area Code)

MARYLAND 52-1794271
------------------------------- ---------------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)

Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Act of 1934 during the past 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 [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS:

As of the close of business on May 6, 2002, 33,506,007 shares of the Company's
common stock, par value $0.01 per share, were issued and outstanding.

EQUITY ONE, INC.

FORM 10-Q

INDEX

PART I - FINANCIAL INFORMATION
PAGE
----

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Condensed Consolidated Balance Sheets-
As of March 31, 2002 and December 31, 2001 (unaudited) ................................................ 1

Condensed Consolidated Statements of Operations-
For the three-month periods ended March 31, 2002 and 2001 (unaudited) ................................. 3

Condensed Consolidated Statements of Comprehensive Income-
For the three-month periods ended March 31, 2002 and 2001 (unaudited) ................................. 5

Condensed Consolidated Statements of Stockholders' Equity-
For the three-month period ended March 31, 2002 (unaudited) ........................................... 6

Condensed Consolidated Statements of Cash Flows-
For the three-month periods ended March 31, 2002 and 2001 (unaudited) ................................. 7

Notes to the Condensed Consolidated Financial Statements (unaudited) .................................. 9

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS ................. 13

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK ............................................ 19

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS ..................................................................................... 20

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS ............................................................. 20

ITEM 3. DEFAULTS UPON SENIOR SECURITIES ....................................................................... 20

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS ................................................... 20

ITEM 5. OTHER INFORMATION ..................................................................................... 20

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K ...................................................................... 21

SIGNATURES ..................................................................................................... 21

PART I - FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

EQUITY ONE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 2002 AND DECEMBER 31, 2001
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
- -------------------------------------------------------------------------------

MARCH 31, DECEMBER 31,
2002 2001
--------- ------------
ASSETS

RENTAL PROPERTY:
Land, buildings and equipment ................. $ 612,404 $ 607,507
Building improvements ......................... 18,207 18,794
Land held for development ..................... 25,421 23,792
Construction in progress ...................... 7,997 5,912
--------- ---------

Total rental property ....................... 664,029 656,005
Less: accumulated depreciation .............. (31,298) (28,318)
--------- ---------

Rental property, net ............................ 632,731 627,687

CASH AND CASH EQUIVALENTS ....................... 3,304 906

CASH HELD IN ESCROW ............................. 7,764 1,715

SECURITIES AVAILABLE FOR SALE ................... 1,688 1,681

ACCOUNTS AND OTHER RECEIVABLES, NET ............. 3,328 5,564

NOTES RECEIVABLE ................................ 11,094 9,697

DEPOSITS ........................................ 7,327 6,219

PREPAIDS AND OTHER ASSETS ....................... 2,619 2,912

DEFERRED EXPENSES, NET .......................... 3,378 3,132

INVESTMENTS IN JOINT VENTURES ................... 7,837 7,742

GOODWILL, NET ................................... 2,276 1,281
--------- ---------

TOTAL ........................................... $ 683,346 $ 668,536
========= =========

(Continued)

MARCH 31, DECEMBER 31,
2002 2001
--------- ------------

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:

NOTES PAYABLE
Mortgage notes payable ....................................................... $ 316,374 $ 345,047
Revolving credit facilities .................................................. 9,000 27,409
--------- ---------

Total notes payable ........................................................ 325,374 372,456

OTHER LIABILITIES
Accounts payable and accrued expenses ........................................ 9,953 8,987
Tenants' security deposits ................................................... 3,868 4,090
Minority interest in equity of consolidated subsidiaries ..................... 3,869 3,869
Deferred rental income ....................................................... 239 766
Due to related parties ....................................................... -- 101
--------- ---------

Total liabilities .......................................................... 343,303 390,269
--------- ---------

COMMITMENTS AND CONTINGENT LIABILITIES

STOCKHOLDERS' EQUITY:
Preferred Stock, $0.01 par value - 5,000 shares authorized but unissued ...... -- --
Common stock, $0.01 par value - 40,000 shares authorized, 33,371
and 28,781 shares issued and outstanding for 2002 and 2001,
respectively ............................................................... 334 288
Additional paid-in capital ................................................... 340,741 283,619
Retained earnings ............................................................ 7,065 1,808
Accumulated other comprehensive loss ......................................... (27) (34)
Unamortized restricted stock compensation .................................... (1,626) (1,836)
Notes receivable from issuance of common stock ............................... (6,444) (5,578)
--------- ---------

Total stockholders' equity ................................................. 340,043 278,267
--------- ---------

TOTAL .......................................................................... $ 683,346 $ 668,536
========= =========

See accompanying notes to the condensed consolidated financial statements. (Concluded)

EQUITY ONE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2002 AND 2001
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
- --------------------------------------------------------------------------------

THREE MONTHS ENDED
MARCH 31,
-------------------------
2002 2001
-------- --------

RENTAL INCOME:
Minimum rents ...................................................... $ 18,282 $ 13,756
Expense recoveries ................................................. 6,210 4,139
Percentage rent payments ........................................... 941 574
-------- --------
Total rental income .............................................. 25,433 18,469

MANAGEMENT FEES ...................................................... 98 241
INTEREST AND DIVIDENDS ............................................... 413 450
-------- --------
Total revenues ................................................... 25,944 19,160
-------- --------

COSTS AND EXPENSES:
Property operating expenses ........................................ 7,793 5,457
Interest and amortization of deferred financing fees ............... 6,320 5,270
Rental property depreciation and amortization ........................ 3,323 2,562
General and administrative expenses .................................. 1,996 811
-------- --------
Total costs and expenses ......................................... 19,432 14,100
-------- --------

INCOME BEFORE EQUITY IN INCOME OF JOINT VENTURES,
MINORITY INTEREST IN EARNINGS OF CONSOLIDATED
SUBSIDIARY, INCOME TAXES, MINORITY INTEREST IN
CEFUS AND DISCONTINUED OPERATIONS ................................. 6,512 5,060

EQUITY IN INCOME OF JOINT VENTURES ................................... 151 127

MINORITY INTEREST IN EARNINGS OF CONSOLIDATED SUBSIDIARY ............. (25) --
-------- --------

INCOME BEFORE INCOME TAXES, MINORITY INTEREST IN
CEFUS AND DISCONTINUED OPERATIONS .................................. 6,638 5,187

INCOME TAX BENEFIT (EXPENSE)
Current ............................................................ -- 180
Deferred ........................................................... -- (965)
-------- --------
Total income tax benefit (expense) ............................... -- (785)
-------- --------

INCOME BEFORE MINORITY INTEREST IN CEFUS AND
DISCONTINUED OPERATIONS ............................................ 6,638 4,402

MINORITY INTEREST IN CEFUS ........................................... -- (446)
-------- --------

INCOME FROM CONTINUING OPERATIONS .................................... 6,638 3,956
-------- --------

(Continued)

THREE MONTHS ENDED
MARCH 31,
--------------------------------
2002 2001
------------ ------------

DISCONTINUED OPERATIONS
Income from operations of sold properties ................. 507 68
Gain on disposal of real estate ........................... 6,122 --
------------ ------------
Total income from discontinued operations ............... 6,629 68
------------ ------------

NET INCOME .................................................. $ 13,267 $ 4,024
============ ============

EARNINGS PER SHARE:

BASIC EARNINGS PER SHARE
Income from continuing operations ......................... $ 0.23 $ 0.20
Income from discontinued operations ....................... 0.22 --
------------ ------------
Total basic earnings per share .......................... $ 0.45 $ 0.20
============ ============

NUMBER OF SHARES USED IN COMPUTING
BASIC EARNINGS PER SHARE .................................. 29,354 19,853
============ ============

DILUTED EARNINGS PER SHARE
Income from continuing operations ......................... $ 0.22 $ 0.20
0.22 --
------------ ------------
Total diluted earnings per share ........................ $ 0.44 $ 0.20
============ ============

NUMBER OF SHARES USED IN COMPUTING
DILUTED EARNINGS PER SHARE ................................ 30,029 20,378
============ ============

(Concluded)
See accompanying notes to the condensed consolidated financial statements.

EQUITY ONE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2002 AND 2001
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
- --------------------------------------------------------------------------------

THREE MONTHS ENDED
MARCH 31,
--------------------------------
2002 2001
------------ ------------

NET INCOME ......................................................... $ 13,267 $ 4,024

OTHER COMPREHENSIVE INCOME:

Net unrealized holding gain on securities available for sale ..... 7 161
------------ ------------

COMPREHENSIVE INCOME ............................................... $ 13,274 $ 4,185
============ ============

See accompanying notes to the condensed consolidated financial statements.

EQUITY ONE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2002
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
- --------------------------------------------------------------------------------

ACCUMULATED NOTES
OTHER RECEIVABLE
COMPRE- UNAMORTIZED FROM TOTAL
ADDITIONAL HENSIVE RESTRICTED ISSUANCE OF STOCK-
COMMON PAID-IN RETAINED (LOSS)/ STOCK COM- COMMON HOLDERS'
STOCK CAPITAL EARNINGS INCOME PENSATION STOCK EQUITY
--------------------------------------------------------------------------------

Balance, January 1, 2002 ........... $ 288 $ 283,619 $1,808 $ (34) $ (1,836) $(5,578) $278,267

Issuance of common stock ........... 46 57,912 210 (866) 57,302
Stock issuance costs ............... (790) (790)
Net income ......................... 13,267 13,267
Net unrealized holding gain on
securities available for sale.... 7 7
Dividends paid (8,010) (8,010)
--------------------------------------------------------------------------------

Balance, March 31, 2002 ............ $ 334 $ 340,741 $7,065 $ (27) $ (1,626) $(6,444) $340,043
================================================================================

See accompanying notes to the condensed consolidated financial statements.

EQUITY ONE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2002 AND 2001
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
- --------------------------------------------------------------------------------

THREE MONTHS ENDED
MARCH 31,
---------------------------------
2002 2001
------------ ------------

OPERATING ACTIVITIES:

Net income .................................................... $ 13,267 $ 4,024
Adjustments to reconcile net income to net cash provided by
operating activities:
Rental property depreciation and amortization ............. 3,323 2,562
Amortization of deferred financing fees ................... 265 220
Provision for losses on accounts receivable ............... 163 25
Gain on disposal of real estate ........................... (6,122) --
Equity in income of joint ventures ........................ (151) (127)
Minority interest in earnings of consolidated subsidiary .. 25 --
Minority interest in CEFUS ................................ -- 446
Deferred income tax expense ............................... -- 965
Changes in assets and liabilities:
Cash held in escrow ....................................... -- (59)
Accounts and other receivables ............................ 1,755 2,726
Deposits .................................................. (1,008) (683)
Prepaid and other assets .................................. 203 (515)
Accounts payable and accrued expenses ..................... 275 (461)
Tenants' security deposits ................................ (222) 47
Deferred rental income .................................... (527) 190
Due from related parties .................................. (59) 35
------------ ------------

Net cash provided by operating activities ............... 11,187 9,395
------------ ------------

INVESTING ACTIVITIES:
Additions to and purchase of rental property .................. (12,469) (5,241)
Proceeds from disposal of rental property ..................... 8,847 --
Cash held in escrow ........................................... (6,049) --
Additions to notes receivable ................................. (58) --
Distributions received from joint ventures .................... 56 --
------------ ------------

Net cash used in investing activities ....................... (9,673) (5,241)
------------ ------------

FINANCING ACTIVITIES:
Repayments of mortgage notes payable .......................... (28,673) (1,136)
Borrowings under mortgage notes payable ....................... -- 4,700
Net repayments under credit agreements ........................ (18,409) (471)
Deferred financing costs ...................................... (511) (58)
Due to affiliates ............................................. -- (2,378)
Stock subscription and issuance of common stock ............... 57,302 12
Stock issuance costs .......................................... (790) (8)

Cash dividends paid to stockholders ........................... (8,010) (3,366)

Distributions to minority interest ............................ (25) (6)
------------ ------------

Net cash provided by (used in) financing activities ............ 884 (2,711)
------------ ------------

(Continued)

THREE MONTHS ENDED
MARCH 31,
--------------------------------
2002 2001
------------ ------------

NET INCREASE IN CASH AND CASH EQUIVALENTS ................................ 2,398 1,443

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD ........................... 906 2,346
------------ ------------

CASH AND CASH EQUIVALENTS, END OF PERIOD ................................. $ 3,304 $ 3,789
============ ============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest, net of amount capitalized .................... $ 6,191 $ 5,156
============ ============

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Change in unrealized holding gain on securities available for sale ... $ 7 $ 161
============ ============
Issuance of restricted stock ......................................... $ 427 $ 811
============ ============
Common stock issued for note receivable .............................. $ 866
============
Note receivable from sale of property ................................ $ 1,425
============

(Concluded)
See accompanying notes to the condensed consolidated financial statements.

EQUITY ONE, INC. AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2002 AND 2001
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
- --------------------------------------------------------------------------------

1. ORGANIZATION

Equity One, Inc., along with its related subsidiaries and joint
ventures (collectively, the "Company"), was formed in 1992 for the purpose of
holding various real estate investments. The Company is a fully integrated,
self-managed, real estate investment trust ("REIT").

As of March 31, 2002, the Company owned a total of 86 properties,
primarily located in metropolitan areas of Florida and Texas, encompassing 54
supermarket-anchored shopping centers, eight drug store-anchored shopping
centers, 18 other retail-anchored shopping centers, four commercial properties,
one supermarket-anchored development and one drug store-anchored development, as
well as interests in three joint ventures which own and operate commercial real
estate properties.

On September 20, 2001, the Company completed the acquisition of
Centrefund Realty (U.S.) Corporation ("CEFUS") from First Capital Realty Inc.,
formerly known as Centrefund Realty Corporation, for approximately $281,000
(including assumed debt). As provided for in the stock exchange agreement, the
Company issued 10,500 shares of its common stock to subsidiaries of First
Capital Realty Inc. and assumed $149,021 of CEFUS's outstanding debt. The
acquisition of CEFUS was partially accounted for on a "push-down" basis and
partially in a manner similar to a pooling of interests, due to the acquisition
by Gazit Globe (1982) Ltd., the Company's majority shareholder, of a 68.07%
controlling interest in Centrefund Realty Corporation on August 18, 2000.

The Company's results for the quarter ended March 31, 2001 have been
restated to incorporate the results of CEFUS for the period of January 1, 2001
to March 31, 2001. The restatement consolidates the operations of Equity One and
CEFUS between January 1, 2001 to March 31, 2001, subject to a 31.93% minority
interest in CEFUS (the "CEFUS Accounting Treatment"). During the period January
1, 2001 to March 31, 2001, CEFUS operated under the control of Centrefund Realty
Corporation as a C-corporation and recorded current and deferred income taxes in
connection with its operations. These taxes are reflected on the Company's
financial statements by way of the CEFUS Accounting Treatment. Effective
September 20, 2001, the Company no longer recorded any provision for income
taxes consistent with its acquisition of 100% of CEFUS, and the operation of
CEFUS as a qualified REIT subsidiary. In addition, with the Company's September
20, 2001 acquisition of 100% of CEFUS, the Company eliminated the 31.93%
minority interest in CEFUS, and recorded the issuance of 10,500 shares of its
common stock.

The effect of the CEFUS Accounting Treatment on the condensed
consolidated statement of operations for the three-month period ended March 31,
2001 (unaudited) is as follows:

REVENUES:
Equity One........................................ $ 9,827
CEFUS ............................................ 9,599
--------

Total revenues ....................................... $ 19,426
========

NET INCOME:
Equity One ....................................... $ 3,074
CEFUS ............................................ 950
--------

Total net income...................................... $ 4,024
========

On September 21, 2001, the Company completed the acquisition of United
Investors Realty Trust ("UIRT"), a Texas-based REIT, for $147,640 (including
assumed debt). As a result of the transaction with UIRT, the Company issued
2,896 shares of its common stock, paid $32,876 in cash consideration to former
UIRT shareholders and assumed approximately $79,867 of UIRT's outstanding debt.
The acquisition of UIRT was accounted for using the purchase method and the
results of UIRT are included in the Company's financial statements from the date
of its acquisition.

2. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements
have been prepared by the Company's management in accordance with accounting
principles generally accepted in the United States of America for interim
financial information and with the instructions of Form 10-Q and Article 10 of
Regulation S-X of the U.S. Securities and Exchange Commission. Accordingly,
these condensed consolidated financial statements do not include all of the
information and footnotes required by accounting principles generally accepted
in the United States of America for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. The results of
operations for the three-month period ended March 31, 2002 are not necessarily
indicative of the results that may be expected for the full year. These
consolidated financial statements should be read in conjunction with
Management's Discussion and Analysis of Financial Condition and Results of
Operations contained in this Form 10-Q and the Company's audited financial
statements and related footnotes, included in the Company's 2001 Amended Annual
Report on Form 10-K/A filed on March 18, 2002.

All significant intercompany transactions and balances have been
eliminated in consolidation.

3. NEW ACCOUNTING PRONOUNCEMENTS

In June 2001, FASB approved the issuance of SFAS No. 141, BUSINESS
COMBINATIONS, and SFAS No. 142, GOODWILL AND OTHER INTANGIBLE ASSETS. These
standards, which were issued in July 2001, established accounting and reporting
for business combinations. SFAS No. 141 requires all business combinations
entered into subsequent to September 30, 2001 to be accounted for using the
purchase method of accounting. SFAS No. 142 provides that goodwill and other
intangible assets with indefinite lives will not be amortized, but will be
tested for impairment on an annual basis. The Company adopted SFAS No. 142 on
January 1, 2002 and no longer amortizes goodwill. For the three-month period
ended March 31, 2001, goodwill amortization was $18. Had this statement been
adopted in 2001 it would not have resulted in any changes to earnings per share.

In August 2001, FASB issued SFAS No. 144, ACCOUNTING FOR THE IMPAIRMENT
OR DISPOSAL OF LONG-LIVED ASSET, which supersedes, but does not replace, SFAS
No. 121, ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS TO BE DISPOSED OF,
as well as other earlier related pronouncements, either in whole or in part.
SFAS No. 144 is effective for financial statements issued for fiscal years
beginning after December 15, 2001 and interim periods within those fiscal years,
although earlier application is encouraged. The Company has adopted SFAS No. 144
effective January 1, 2002 and has reflected the sales and operations of disposed
properties as discontinued operations.

4. STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE

In January 2002, the Company issued to the non-employee members of its
Board of Directors and the corporate secretary a total of 16 shares of
unregistered restricted stock that vest one-half on December 31, 2002 and
one-half on December 31, 2003. In addition, an employee received 1 shares of
unregistered restricted stock that vest one-third on December 31, 2002, 2003 and
2004, respectively.

In January 2002, the Company completed a private placement of 688
shares of common stock to a limited number of accredited investors, half of
which was purchased by investors that are affiliates of the Company, with gross
proceeds of approximately $8,892.

In March 2002, an officer exercised options to purchase 87.5 shares of
common stock in exchange for a promissory note of $866. This note is a full
recourse obligation bearing interest at 5% and is secured by the shares of
common stock issued upon exercise of the options. Interest is payable quarterly
and the full principal balance is due March 30, 2007. This note along with
similar, previously executed notes is reflected in the consolidated financial
statements as a reduction of stockholders' equity.

In March 2002, the Company completed a public offering of 3,450 shares
of common stock, with gross proceeds of approximately $45,713.

In March 2002, the Company issued to an officer 18 shares of
unregistered restricted stock that vest one-half on March 27, 2003 and one-half
on March 27, 2004.

In March 2002, the Company declared and paid a cash dividend of $.27
per common share.

In March 2002, the Company issued 335 shares of its common stock at a
price of $13.425 in exchange for $4,500 of cash dividends pursuant to the
Dividend Reinvestment and Stock Purchase Plan.

The following table sets forth the computation of basic and diluted
earnings per share for the three months ended March 31, 2002 and 2001:

THREE MONTHS ENDED
MARCH 31,
-----------------------
2002 2001
---------- ----------

Denominator for basic earnings per share - weighted
average shares ................................... 29,354 19,853

Walden Woods Village, Ltd............................ 94 94
Unvested employee restricted stock .................. 174 133
Convertible partnership units ....................... 262 262
Stock options ....................................... 145 36
---------- ----------
Subtotal.......................................... 675 525
---------- ----------

Denominator for diluted earnings per share - weighted
average shares.................................... 30,029 20,378
========== ==========

For the three months ended March 31, 2001, basic and diluted earnings
per share have been adjusted so that the weighted average number of shares used
in those calculations includes the effect of the assumed issuance on August 18,
2000 of 68.07% of the 10,500 shares which were issued in connection with the
CEFUS acquisition on September 20, 2001. This adjustment is in accordance with
the CEFUS Accounting Treatment described in Note 1 and has the effect of
increasing the number of basic and diluted weighted average shares by 7,147
shares.

5. DISCONTINUED OPERATIONS

The Company adopted SFAS No. 144, ACCOUNTING FOR THE IMPAIRMENT OR
DISPOSAL OF LONG-LIVED ASSEST and has included the operations and gain on sale
of sold properties as discontinued operations for all periods presented. The
Company expects to reclassify historical operating results whenever necessary in
order to comply with the requirements of SFAS No. 144.

In February 2002, the Company completed the sale of an office building,
located in Florida, for $6,050.

In February 2002, the Company completed the sale of a parcel of land,
located in Florida, for $1,900. As part of the consideration, the Company
received a $1,425 note receivable secured by the property.

In February 2002, the Company completed the sale of a retail center,
located in Texas, for $2,590.

6. ACQUISITIONS

In February 2002, the Company completed the acquisition of two
free-standing drug-stores located in Florida, for purchase prices of $2,400 and
$3,800, respectively.

In February 2002, the Company exercised existing options and acquired
two parcels of land located in Florida, for purchase prices of $2,000 and
$1,000, respectively. These parcels were purchased from affiliated entities. The
parcel acquired for $1,000 was subsequently sold for $1,900 as described above.

7. BORROWINGS

In February 2002, the Company entered into a revolving credit facility
with a bank for $29,400, secured by mortgages on five rental properties and
maturing in February 2005. The credit facility has financial covenants and other
restrictions on the Company.

Each of the existing mortgage loans is secured by a mortgage on one or
more of certain of our properties. Certain of the mortgage loans involving an
aggregate principal balance of approximately $122,900, excluding the $1,600
balance on one mortgage loan which is scheduled to be repaid in 2002, contain
prohibitions on transfers of ownership which may have been violated by the
Company's previous issuances of common stock or in connection with past
acquisitions and may be violated by transactions involving the Company's capital
stock in the future. If a violation were established, it could serve as a basis
for a lender to accelerate amounts due under the affected mortgage. The Company
is in the process of obtaining the necessary consents from the lenders. Based on
discussions with various lenders, current credit market conditions and other
factors, the Company believes that such consents will be obtained or that the
mortgages would not be accelerated. Accordingly, the Company believes that the
ultimate outcome of this matter will not have a material adverse impact on the
Company's results of operations or financial condition.

8. MINORITY INTEREST

On January 1, 1999, a wholly-owned subsidiary of the Company, Equity
One (Walden Woods) Inc. (the "Walden Woods General Partner"), entered into a
limited partnership as a general partner. An income producing shopping center
was contributed by its owners (the "Walden Woods Minority Partners"), and the
Walden Woods General Partner contributed 93.656 shares of Company common stock
to the limited partnership at an agreed-upon price of $10.30 per share. Based on
this per share price and the net asset value of the property contributed by the
Walden Woods Minority Partners, each of the partners received 93.656 limited
partnership units. The Company and the Walden Woods Minority Partners have
entered into an agreement (the "Redemption Agreement") whereby the Walden Woods
Minority Partners can request that the Company purchase either their limited
partnership units or any shares of Company common stock which they have received
in exchange for their limited partnership units at a price of $10.30 per unit or
per share no earlier than two years, nor later than fifteen years, after the
exchange date of January 1, 1999. As a result of the Redemption Agreement, the
minority interest has been presented as a liability. In addition, under the
terms of the limited partnership agreement, the Walden Woods Minority Partners
do not have an interest in the common stock of the Company except to the extent
of dividends declared on such common stock. Accordingly, a preference in
earnings has been allocated to the Walden Woods Minority Partners to the extent
of the dividends declared. The 93.656 shares of common stock of the Company held
by the consolidated limited partnership are not considered outstanding in the
calculation of basic earning per share.

On December 5, 2000, a wholly-owned subsidiary of the Company, Equity
One (North Port) Inc., entered into a limited partnership (the "Shoppes of North
Port, Ltd.") as a general partner. An income producing shopping center was
contributed by its owners (the "North Port Minority Partners") and the Company
contributed an income producing property to a limited liability company
wholly-owned by the Shoppes of North Port, Ltd. Both the North Port Minority
Partners and the general partner were issued 261.850 operating partnership units
("OPUs") based on the net value of the properties contributed. The North Port
Minority Partners can redeem their OPUs for the Company's common stock on a
one-for-one basis or for cash at an agreed upon price of $11.00 per share no
earlier than December 10, 2001, nor later than three and one half years
thereafter. Accordingly, the minority interest has been presented as a liability
in the accompanying condensed consolidated balance sheets. The North Port
Minority Partners receive a preferred quarterly distribution equal to a 9.0%
annual return on their initial capital contribution. This amount is reflected as
interest expense in the condensed consolidated financial statements.

For the period from August 18, 2000 until the closing of the
acquisition of CEFUS on September 20, 2001, the Company recorded the 31.93%
minority interest in CEFUS described in Note 1 to reflect the 31.93% of CEFUS
that Gazit-Globe (1982) Ltd., the Company's majority shareholder, did not own in
Centrefund Realty Corporation, the then 100% owner of CEFUS. On September 20,
2001, the 31.93% minority interest in CEFUS was eliminated by virtue of the
Company's acquisition of 100% of CEFUS.

9. COMMITMENTS AND CONTINGENCIES

As of March 31, 2002, the Company has pledged letters of credit
totaling $2,000 as additional security for certain financings.

As of March 31, 2002, the Company has guaranteed the mortgage note
payable of $15,000 for one of its joint ventures.

The Company is subject to litigation in the normal course of business,
none of which in the opinion of management will have a material adverse effect
on the financial condition or results of operations of the Company.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

OVERVIEW

The following discussion should be read in conjunction with the
Company's Condensed Consolidated Financial Statements, including the notes
thereto, which are included elsewhere herein and the Company's audited
Consolidated Financial Statements and notes thereto for the year ended December
31, 2001 and Management's Discussion and Analysis of Financial Condition and
Results of Operations appearing in the Company's Form 10-K/A. The results of
operations for an interim period may not give a true indication of results for
the year.

Unless the context otherwise requires, all references to "we," "our,"
"us" and the "Company" in this report refer collectively to Equity One, Inc.,
and its subsidiaries, including joint ventures.

RESULTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2002 COMPARED TO THREE MONTHS ENDED MARCH 31, 2001

Total revenues increased by $6.8 million, or 35.4%, to $25.9 million
for the three months ended March 31, 2002 from $19.1 million for the comparable
period of 2001. This increase was primarily due to an increase in revenues of
$5.9 million relating to the acquisition of UIRT in September 2001. Revenues
also increased by $963,000 as a result of the acquisition of three shopping
centers and two drugstores and the completion of a development project, offset
by $284,000 in lost revenues relating to the sales of properties. Additional
sources of increased revenues were percentage rents of $251,000, offset by a
decline in third party management fees and investment income of $180,000 and an
increase in all other property revenues of $194,000.

Property operating expenses increased by $2.3 million, or 42.8% to $7.8
million for the three months ended March 31, 2002 from $5.5 million for the
comparable period of 2001. This increase was primarily due to an increase in
operating expenses of $2.4 million relating to the acquisition of UIRT.
Operating expenses also increased by $250,000 as a result of the acquisitions
mentioned above, offset by $167,000 in reduced expenses relating to the sale of
three properties. All other property operating expenses declined by $183,000.

Rental property depreciation and amortization increased by $761,000, or
29.7% to $3.3 million for the three months ended March 31, 2002 from $2.6
million for the comparable period of 2001. This increase was primarily due to an
increase in depreciation of $661,000 relating to the acquisition of UIRT and a
$101,000 increase related to other acquisitions.

Interest and amortization of deferred financing fees increased by $1.0
million, or 19.9%, to $6.3 million for the three months ended March 31, 2002
from $5.3 million for the comparable period of 2001. This increase was primarily
due to an increase in interest expense of $1.2 million relating to the
assumption of mortgage loans in the acquisition of UIRT. In addition, interest
increased $335,000 from the closing of two new loans and increased $305,000 from
a higher average balance on the revolving credit facilities. These increases to
interest expense were partially offset by the payoff of five loans reducing
interest by $426,000, an increase in capitalized interest of $164,000 and a
decline in interest expense on same mortgage notes of $199,000 due to decreased
interest rates.

General and administrative expenses increased by $1.2 million, or
146.1%, to $2.0 million for the three months ended March 31, 2002 from $811,000
for the comparable period of 2001. Compensation and employer related expenses
increased by $394,000, professional fees increased by $164,000, previously
capitalized preacquisition due diligence costs for projects that did not
materialize were written off totaling $612,000, and all other expenses increased
by $15,000.

During 2001, we recorded a minority interest in CEFUS of $446,000 and
current and deferred taxes of $785,000 related to CEFUS. Upon the acquisition of
CEFUS we no longer record these items. All other income items primarily relate
to the earnings from joint ventures

We sold three properties which are being reflected as discontinued
operations for the three-month periods ended March 31, 2002 and 2001. The sale
of these three properties produced a gain of $6.1 million and income from
discontinued operations of $507,000 for 2002 and $68,000 for 2001.

As a result of the foregoing, net income increased by $9.2 million, or
229.7%, to $13.3 million for the three months ended March 31, 2002 compared to
$4.0 million for the comparable period in 2001.

FUNDS FROM OPERATIONS

We consider Funds From Operations ("FFO") a widely used and appropriate
supplemental measure of performance for an equity REIT which provides a relevant
basis for comparison among REITs. FFO as defined by the National Association of
Real Estate Investment Trusts ("NAREIT") means income (loss) before minority
interest (determined in accordance with accounting principles generally accepted
in the United States of America ("GAAP"), excluding gains (losses) from debt
restructuring, sales of property and deferred income taxes, plus real estate
related depreciation and amortization, and after adjustments for unconsolidated
partnerships and joint ventures. We present FFO to assist investors in analyzing
our performance. Our method of calculating FFO may be different from methods
used by other REITs and, accordingly, may not be comparable to such other REITS.
FFO (i) does not represent cash flows from operations as defined by GAAP, (ii)
is not indicative of cash available to fund all cash flow needs and liquidity,
including its ability to make distributions and (iii) should not be considered
as an alternative to net income (determined in accordance with GAAP) for
purposes of evaluating our operating performance.

The following table illustrates the calculation of FFO (in thousands)
for the three-month periods ended March 31, 2002 and 2001:

THREE MONTHS ENDED
MARCH 31,
------------------------
2002 2001
-------- ----------

Net income ............................................................ $ 13,267 $ 4,024
Adjustments:
Depreciation of real estate assets ................................. 3,263 2,556
Amortization of capitalized leasing fees ........................... 66 21
Gain on disposal of real estate .................................... (6,122) --
Minority interest in earnings of consolidated subsidiary ........... 25 --
Other Items:
Interest on convertible partnership units .......................... 65 64
Deferred income tax benefit ........................................ -- 965
Share of joint venture real estate depreciation .................... 174 18
Minority interest share of FFO adjustments ......................... -- (748)
-------- ----------

FUNDS FROM OPERATIONS ................................................. $ 10,738 $ 6,900
======== ==========

FFO increased by $3.8 million, or 55.6%, to $10.7 million for the three
months ended March 31, 2002, from $6.9 million for the comparable period of
2001. The increase is primarily the result of the inclusion of UIRT's results
for the current period, and the increases in income described above.

The effect of the CEFUS Accounting Treatment on the calculation of FFO
for the three-month period ended March 31, 2001 (unaudited) is as follows:

FUNDS FROM OPERATIONS:
Equity One ........................................ $ 4,354
CEFUS ............................................. 2,546
--------

Total funds from operation ............................ $ 6,900
========

CASH FLOW

Net cash provided by operations of $11.2 million for the three months
ended March 31, 2002 included: (i) net income of $13.3 million, (ii) adjustment
for non-cash and gain on sale items which decreased cash flow by $2.5 million,
and (iii) a net decrease in operating assets and liabilities of $400,000,
compared to net cash provided by operations of $9.4 million for the three months
ended March 31, 2001, which included (i) net income of $4.0 million, (ii)
adjustment for non-cash items which increased cash flow by $4.1 million, and
(iii) a net increase in operating assets and liabilities of $1.3 million.

Net cash used in investing activities of $9.7 million for the three
months ended March 31, 2002 included: (i) the acquisition of two drugstores and
two parcels of land for $9.2 million, (ii) construction, development and other
capital improvements of $3.3 million, and (iii) proceeds from the sale of three
properties of $8.8 million, of which $6.0 million has been escrowed for a tax
free exchange, compared to net cash used in investing activities of $5.2 million
for the three months ended March 31, 2001 which included: (i) the purchase of
one property for $2.0 million, and (ii) improvements to rental properties and
construction expenditures relating to development projects totaling $3.2
million.

Net cash provided by financing activities of $884,000 for the three
months ended March 31, 2002 included: (i) the payoff of five loans for $27.3
million and monthly principal payments on mortgage notes of $1.4 million, (ii)
net repayments on revolving credit facilities of $18.4 million, (iii) cash
dividends paid to common stockholders of $8.0 million, (iv) net proceeds from
issuance of common stock of $56.5 million, and (v) other miscellaneous uses of
$536,000, compared to net cash used by financing activities of $2.7 million for
the three months ended March 31, 2001 which included: (i) principal payments on
mortgage notes of $1.1 million, (ii) borrowings under a new mortgage note of
$4.7 million, (iii) net repayments on the revolving credit facility of $471,000,
(iv) cash dividends paid to common stockholders of $3.4 million, (v) reduction
of obligations to affiliates of $2.4 million and (vi) other miscellaneous uses
of $60,000.

LIQUIDITY AND CAPITAL RESOURCES

The Company's principal demands for liquidity are maintenance
expenditures, repairs, property taxes and tenant improvements relating to rental
properties, acquisition and development activities, debt service and repayment
obligations, and distributions to its stockholders. The principal sources of
funding for the Company's operations are operating cash flows, the issuance of
equity securities, the placement of mortgage loans and periodic borrowings under
the Company's revolving credit facilities.

As of March 31, 2002, we had a $10.8 million revolving credit agreement
secured by five properties with City National Bank of Florida. In February 2002,
the amount was reduced from a prior authorization of $20.6 million through the
release of certain collateral. This facility accrues interest at 2.25% over the
thirty-day LIBOR rate, payable monthly, adjusted every six months, and is due on
demand. A one-year extension of this facility at similar terms is in the process
of being finalized. This facility has been used to provide a $1.0 million letter
of credit in connection with the Pine Island/Ridge Plaza financing and to
support approximately $448,000 in escrows for property taxes on the properties
comprising its collateral, thereby reducing its gross availability to
approximately $9.4 million.

On September 17, 2001, we entered into a $30.0 million revolving line
of credit with Bank Leumi Le-Israel B.M. This facility accrues interest at 1.25%
over the 30 or 90-day LIBOR rate, at our option, and is payable monthly or
quarterly depending on our rate selection. The facility matures in September
2002, with an option to extend it an additional 180 days. Under the Bank Leumi
credit agreement, we agreed not to mortgage or encumber seven of our properties,
as amended on February 18, 2002.

On February 27, 2002, we entered into a revolving credit facility with
Wells Fargo under which we may borrow up to $29.4 million against a borrowing
base of five properties pledged to secure the facility. Borrowings under the
facility will bear interest, at our option, at the prime rate or based on LIBOR
plus a margin ranging from 1.15% if the ratio of our total liabilities to gross
asset value is less than 0.5, to 1.50% if the ratio of our total liabilities to
gross asset value is or exceeds 0.60. The entire principal amount is due
February 26, 2005. This new facility also prohibits shareholder distributions in
excess of 95% of funds for operations calculated at the end of each fiscal
quarter for the four fiscal quarters then ending. Notwithstanding this
limitation, we can make shareholder distributions to avoid income taxes on asset
sales. If a default under the facility exists, our ability to pay dividends
would be limited to the amount necessary to maintain our status as a REIT. The
facility also contains financial covenants that require us to maintain:

o A consolidated net worth of not less than $251.4 million plus 90% of
net proceeds of equity issuances;

o A ratio of total liabilities to gross asset value of not more than
0.65;

o A ratio of EBITDA to interest expense of not less than 1.90;

o A ratio of EBITDA to fixed charges of not less than 1.65; and

o An occupancy rate on properties in the borrowing base of not less
than 85%.

Our revolving credit facility balances as of March 31, 2002 and
December 31, 2001 consisted of the following:

MARCH 31, 2002 DECEMBER 31, 2001
-------------- -----------------
(in thousands)

REVOLVING CREDIT FACILITIES
City National Bank ......................................... $ -- $ 1,409
Bank Leumi ................................................. 9,000 26,000
Wells Fargo ................................................ -- N/A
--------- ---------

Total revolving credit facilities ...................... $ 9,000 $ 27,409
========= =========

As of March 31, 2002, the amount available under the various
revolving credit facilities is $59.8 million.

Our mortgage note balances as of March 31, 2002 and December 31, 2001
consisted of the following:

MARCH 31, 2002 DECEMBER 31, 2001
-------------- -----------------
(in thousands)

MORTGAGE NOTES PAYABLE
Fixed rate mortgage loans .................................. $ 291,739 $ 296,887
Variable rate mortgage loans ............................... 24,635 48,160

Total mortgage notes payable ........................... $ 316,374 $ 345,047

Each of the mortgage loans is secured by a mortgage on one or more of
certain of our properties. Certain of the mortgage loans involving an aggregate
principal balance of approximately $122.9 million, excluding the $1.6 million
balance on one mortgage loan which is scheduled to be repaid in 2002, contain
prohibitions on transfers of ownership which may have been violated by our
previous issuances of common stock or in connection with past acquisitions and
may be violated by transactions involving our capital stock in the future. If a
violation were established, it could serve as a basis for a lender to accelerate
amounts due under the affected mortgage. We are in the process of obtaining the
necessary consents from the lenders. Based on discussions with various lenders
to date, current credit market conditions and other factors, we believe that
such consents will be obtained or that the mortgages would not be accelerated.
Accordingly, we believe that the ultimate outcome of this matter will not have a
material adverse impact on our results of operations or financial condition.

As of March 31, 2002, our total debt of $325.4 million less our cash
and cash equivalents, cash held in escrow and securities available for sale, or
$312.6 million divided by our gross real estate assets of $664.0 million equals
47.1%.

As of March 31, 2002, the balances due at the maturity of our various
mortgage loans (excluding revolving credit facilities) are as follows:

PRINCIPAL BALANCE DUE AT
YEAR MATURITY
--------------------------- ------------------------

2002....................... $ 16,989
2003....................... --
2004....................... 24,635
2005....................... 21,254
2006....................... 26,470
Thereafter................. 172,998
---------

Total.................. $ 262,346
=========

Our debt level could subject us to various risks, including the risk
that our cash flow will be insufficient to meet required payments of principal
and interest, and the risk that the resulting reduced financial flexibility
could inhibit our ability to develop or improve our rental properties, withstand
downturns in our rental income or take advantage of business opportunities. In
addition, because we currently anticipate that only a small portion of the

principal of our indebtedness will be repaid prior to maturity, it is expected
that it will be necessary to refinance the majority of our debt. Accordingly,
there is a risk that such indebtedness will not be able to be refinanced or that
the terms of any refinancing will not be as favorable as the terms of our
current indebtedness.

We commenced development in March 2002 of an 84,000 square foot
supermarket-anchored shopping center on a parcel of land located at the
southeast corner of S.W. 147th Avenue and Coral Way in Miami-Dade County,
Florida. We anticipate the cost of development to be approximately $10.0
million, including $2.0 million we have already incurred upon the exercise of
our option to purchase from several of our affiliates all of the outstanding
shares of common stock of Equity One (Coral Way), Inc. the sole asset of which
consisted of this parcel of land. We expect to commence development in late 2002
of a 25,000 square foot drug-store anchored shopping center on a parcel of land
we already own at the northeast corner of S.W. 147th Avenue and Coral Way in
Miami-Dade County, Florida at a total cost of $2.0 million. We expect to
commence development in late 2002 of an additional 40,000 square feet at our
Skylake Shopping Center in Miami-Dade County, Florida at a total cost of $3.0
million. We expect to fund the costs of these development projects with cash
flow from operations and borrowings under our various revolving credit
facilities.

On January 18, 2002, we completed a private placement of 688,000 shares
of our common stock to a limited number of accredited investors. In connection
with the private placement, we sold an aggregate of 344,000 shares of our common
stock at a price of $12.80 per share to unaffiliated investors and 344,000
shares of our common stock at price of $13.05 per share to investors that are
affiliates of ours. The net proceeds of $8.9 million from the private placement
were used for general corporate purposes.

On January 23, 2002, we filed a universal shelf registration statement
with the Securities and Exchange Commission, which will permit us, from time to
time, to offer and sell various types of securities, including common stock,
preferred stock, debt securities, depositary shares and warrants, up to a value
of $250 million. The registration statement provides us additional flexibility
in accessing capital markets to fund future growth and for general corporate
purposes. As of March 31, 2002, our remaining availability under the universal
shelf registration totaled $204.3 million.

On March 27, 2002, we concluded the underwritten sale of 3,450,000
shares of common stock of a price of $13.25 per share through a group of
underwriters led by Legg Mason World Market. The net proceeds of $42.9 million
from the stock offering were used to repay certain existing indebtedness.

On March 29, 2002, we issued 335,208 shares of our common stock at a
price of $13.425 per share in exchange for $4.5 million of cash dividends
pursuant to our Divided Reinvestment and Stock Purchase Plan. As of March 31,
2002, our remaining availability under our Dividend Reinvestment and Stock
Purchase Plan totaled 800,397 shares.

We believe, based on currently proposed plans and assumptions relating
to our operations, that our existing financial arrangements, together with cash
flows from operations, will be sufficient to satisfy our cash requirements for a
period of at least twelve months. In the event that our plans change, our
assumptions change or prove to be inaccurate or cash flows from operations or
amounts available under existing financing arrangements prove to be insufficient
to fund our expansion and development efforts or to the extent we discover
suitable acquisition targets the purchase price of which exceeds our existing
liquidity, we would be required to seek additional sources of financing. There
can be no assurance that any additional financing will be available on
acceptable terms or at all, and any future equity financing could be dilutive to
existing shareholders. If adequate funds are not available, our business
operations could be materially adversely affected.

We believe that we qualify and intend to qualify as a REIT under the
Internal Revenue Code. As a REIT, we are allowed to reduce taxable income by all
or a portion of our distributions to stockholders. As distributions have
exceeded taxable income, no provision for federal income taxes has been made.
While we intend to continue to pay dividends to our stockholders, we also will
reserve such amounts of cash flow as we consider necessary for the proper
maintenance and improvement of our real estate, while still maintaining our
qualification as a REIT.

INFLATION

Most of our leases contain provisions designed to partially mitigate
the adverse impact of inflation. Such provisions include clauses enabling us to
receive percentage rents based on tenant gross sales above predetermined levels,
which rents generally increase as prices rise, or escalation clauses which are
typically related to increases in the Consumer Price Index or similar inflation
indices. Most of our leases require the tenant to pay its share of operating
expenses, including common area maintenance, real estate taxes and insurance,
thereby reducing our exposure to increases in costs and operating expenses
resulting from inflation.

Our financial results are affected by general economic conditions in
the markets in which its properties are located. An economic recession, or other
adverse changes in general or local economic conditions could result in the
inability of some existing tenants to meet their lease obligations and could
otherwise adversely affect our ability to attract or retain tenants. The
properties are typically anchored by supermarkets, drug stores and other
consumer necessity and service retailers which typically offer day-to-day
necessities rather than luxury items. These types of tenants, in our experience,
generally maintain more consistent sales performance during periods of adverse
economic conditions.

CAUTIONARY STATEMENT RELATING TO FORWARD LOOKING STATEMENTS

Certain statements made in this Quarterly Report on Form 10-Q may
constitute "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. Such forward-looking statements include statements
regarding the Company's intent, belief or current expectations and those of the
Company's management and involve known and unknown risks, uncertainties and
other factors which may cause the Company's actual results, performance or
achievements to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. General
economic and business conditions, which will, among other things, affect the
demand for retail rental space, availability and creditworthiness of prospective
tenants, lease rents, lease-up of vacant space and the terms and availability of
financing; adverse changes in the real estate markets including, among other
things, competition with other companies; risks of real estate markets
including, development and acquisition; governmental actions and initiatives;
and environmental/safety requirements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

The primary market risk to which the Company has exposure is interest
rate risk. Changes in interest rates can affect the Company's net income and
cash flows. As changes in market conditions occur, interest rates can either
increase or decrease and interest expense from the variable component of the
Company's debt balances will move in the same direction. With respect to its
investment portfolio, changes in interest rates generally do not affect the
Company's interest income as its investments are predominantly in equity
securities. With respect to its notes receivable, changes in interest rates
generally do not affect the Company's interest income as its notes receivable
are predominantly at fixed-rates for extended terms, and would be unaffected by
any sudden change in interest rates. With respect to its mortgage notes payable,
changes in interest rates generally do not affect the Company's interest expense
as its mortgage notes payable are predominantly at fixed-rates for extended
terms with a weighted average life of 6.7 years, and would be unaffected by any
sudden change in interest rates. Because the Company has the intent to hold its
existing mortgages to maturity (or until the sale of the associated property),
there is believed to be no interest rate market risk on the Company's results of
operations or its working capital position. The Company's possible risk is from
increases in long-term real estate mortgage rates that may occur over a period
of several years, as this may decrease the overall value of its real estate.

The Company estimates the fair market value of its long term, fixed
rate mortgage loans using discounted cash flow analysis based on current
borrowing rates for similar types of debt. At March 31, 2002, the fair value of
the fixed rate mortgage loans was estimated to be $297,272 compared to the
carrying value amount of $291,739. If the weighted average interest rate on the
Company's fixed rate debt were 100 basis points higher or lower than the current
weighted average rate of 7.76%, the fair market value would be $276,189 and
$305,202, respectively.

If the weighted average interest rate on the Company's variable rate
debt were 100 basis points higher or lower, annual interest expense would
increase or decrease by approximately $336,000 based on the Company's variable
rate debt balance on March 31, 2002 (encompassing $9.0 million of revolving
credit facilities and $24.6 million of variable rate mortgage loans).

The Company's objective in managing its exposure to interest rate
changes is to limit the impact of interest rate changes on earnings and cash
flows. The Company may use a variety of financial instruments to reduce its
interest rate risk, including interest rate swap agreements whereby the Company
exchanges its variable interest costs on a defined amount of principal for
another party's obligation to pay fixed interest on the same amount of
principal, or interest rate caps, which will set a ceiling on the maximum
variable interest rate the Company will incur on the amount of debt subject to
the cap and for the time period specified in the interest rate cap. At the
present time, the Company has no such facilities in place.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Neither the Company nor the Company's properties are subject to any
material litigation. The Company and its properties may be subject to routine
litigation and administrative proceedings arising in the ordinary course of
business which collectively is not expected to have a material adverse affect on
the business, financial condition, results of operations or cash flows of the
Company.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

On January 1, 2002 the Company issued to the non-employee members of
its Board of Directors and the Secretary a total of 16,000 shares of
unregistered restricted stock that vest one-half on December 31, 2002 and
one-half on December 31, 2003. In addition, an employee received 1,000 shares of
unregistered restricted stock that vests one-third on December 31, 2002, 2003
and 2004, respectively.

On January 18, 2002, the Company completed a private placement sale of
688,000 shares of the common stock. Ten accredited investors purchased 344,000
shares of common stock at $12.80 per share. Three affiliated members, Alony Hetz
Properties & Investments, Ltd., Silver Maple (2001), Inc. and M.G.N. (USA) Inc.
purchased 70,000, 150,000, and 124,000 shares of common stock, respectively, at
$13.05 per share. The net proceeds of $8.9 million were used for general
corporate purposes.

On March 15, 2002 an officer of the Company exercised options to
purchase 87,500 shares of the Company's common stock at a price of $9.90 per
share. The Company received a promissory note from the officer as consideration
in the amount of $866,250.

On March 28, 2002, the Company issued 18,000 shares of unregistered
restricted stock to an officer as a long-term compensation award. The shares
vest one-half on March 27, 2003 and one-half on March 27, 2004.

The foregoing issuances were made pursuant to exemptions under Section
4(2) of the Securities Act of 1933, as amended.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:

10.1 Promissory Note and Pledge Agreement, in the amount of $866,250
from Howard Sipzner payable to Equity One, Inc.

(b) Reports on Form 8-K:

During the quarterly period ended March 31, 2002, the Company filed the
following reports on Form 8-K:

(i) Report on Form 8-K dated March 21, 2002 under Items 5 and 7
made available certain exhibits concerning the public offering of 3,450,000
shares of the Company's common stock.

SIGNATURES

Pursuant to the requirements 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.

Date: May 15, 2002 EQUITY ONE, INC.

/s/ CHAIM KATZMAN
-------------------------------------------
Chaim Katzman
Chief Executive Officer
(Principal Executive Officer)

/s/ HOWARD M. SIPZNER
-------------------------------------------
Howard M. Sipzner
Chief Financial Officer
(Principal Accounting and Financial Officer)

EXHIBIT 10.1
------------

PROMISSORY NOTE
---------------

$ 866,250.00 Miami, Florida March 15, 2002
-----------

FOR VALUE RECEIVED, the undersigned promises to pay to the order of
EQUITY ONE, INC., a Maryland Corporation the principal sum of EIGHT HUNDRED
SIXTY SIX THOUSAND TWO HUNDRED FIFTY DOLLARS ($866,250.00), together with
interest thereon from date, at the rate of five and NO/100 (5.00%) percent per
annum until maturity, payable interest only in the sum of $10,828.13 quarterly,
commencing on June 30, 2002 and each September 30, December 30, March 30 and
June 30, thereafter until March 30, 2007, when the principal balance of
$866,250.00 plus accrued interest, if any, shall be due and payable; Said
principal and interest being payable in lawful money of the United States or its
equivalent,

EQUITY ONE, INC.
1696 N.E. Miami Gardens Drive
North Miami Beach, FL 33179

This note may be prepaid, in part or in full, at any time; without
prepayment penalty. Any payment received more than ten (10) days after the due
date shall be subject to a five (5%) per cent late fee. In the event any payment
is not received within ten (10) days of the due date, then in such event, the
borrower shall be deemed in default, the interest rate thereafter will
automatically increase to the maximum rate then permitted by law and Mortgagee
shall be entitled to all remedies available.

The holder hereof shall have the optional right to declare the
principal sum disbursed hereunder and all accrued interest thereon to be due and
forthwith payable in advance of the maturity date fixed herein upon the failure
of the undersigned to pay, when due, any one of the installments of interest or,
at the option of the holder, upon the occurrence of any other event of default
by the undersigned in the Mortgage securing this Note after 15 days written
notice from the Holder to Maker. Failure to exercise this option with respect to
any failure or breach by the undersigned shall not constitute a waiver of the
right as to any subsequent failure or breach.

In no event shall interest (including any charge or fee held to be
interest by a court of competent jurisdiction) accrue to be payable herein in
excess of the highest contract rate allowable by law for the time such
indebtedness shall be outstanding and unpaid, and if by reason of the
acceleration of maturity of such indebtedness, or for any other reason, interest
in excess of the highest legal rate shall be due or paid, any such excess shall
constitute and be treated as a payment on the principal hereof and shall operate
to reduce such principal by the amount of such excess, or if in excess of the
principal indebtedness, such excess shall be waived or refunded to the maker.

Each maker and endorser severally waives demand, protest, notice of
maturity and notice of nonpayment and all requirements necessary to hold each of
them liable as makers and endorser.

Each maker and endorser further agrees, jointly and severally, to pay
all costs of collection, including a reasonable attorney's fee in case the
principal of this note or any payment on the principal or any interest thereon
is not paid at the respective maturity thereof, or in case it becomes necessary
to protect the security hereof, whether suit be brought or not.

Upon default, this note and deferred interest payments shall bear
interest at the maximum rate allowed by law.

This note is secured by a Pledge Agreement of even date herewith and is
to be construed and enforced according to the laws of the State of Florida; upon
default in the payment of principal and/or interest due on any note

secured by said Pledge Agreement, all notes so secured and remaining unpaid
shall forthwith become due and payable notwithstanding their tenor.

All of the covenants, conditions, and agreements contained in the
Pledge Agreement and any other document evidencing the loan are hereby made a
part of this instrument.

The Lender and the Maker specifically agree that they waive all rights
to rely on or enforce any oral statements made prior to or subsequent to the
signing of this document.

The Lender and the Maker hereby knowingly, voluntarily and
intentionally waive the right either may have to a trial by jury with respect to
any litigation based hereon, or arising out of, under or in connection with this
document, and any agreement contemplated to be executed in conjunction herewith,
or any course of conduct, course of dealing, statements (whether verbal or
written) or actions of either party made before, during, or after the execution
of this document.

Venue and jurisdiction shall be in Miami Dade County, Florida, for any
affirmative or defensive legal proceeding in connection with this document
and/or any other document signed by the mortgagors, and/or borrowers in favor of
the Lender.

In Witness Whereof, the parties have set their hands and seals on the
date first above written.

- ----------------------------------------------

/s/ HOWARD SIPZNER
- ----------------------------------------------
HOWARD SIPZNER

PLEDGE AGREEMENT
----------------

THIS PLEDGE AGREEMENT made and entered into this 15TH day of MARCH,
2002 by and among HOWARD SIPZNER ("Pledgor") and EQUITY ONE, INC. (the "Secured
Party").

WHEREAS, Pledgor has exercised 87,500 options at $9.90 per option to
purchase 87,500 shares of common stock of Equity One, Inc., par value $.01 per
share (the "Company"), which Pledgor intends to pledge as described herein, (the
"Common Shares");

WHEREAS, Pledgor is an employee of the Company and has received a loan
from the Company evidenced by a Promissory Note dated on even date in the sum of
$866,250 to pay for the Common Shares acquired through the exercise of the
options;

WHEREAS, the Company has requested from the Pledgor and the Pledgor has
agreed to pledge the Common Shares to secure the repayment of the loan.

WHEREAS, in consideration of the loan granted by the Company to the
Pledgor, the Pledgor has agreed to pledge its Common Shares to the Company; and

WHEREAS, as an additional inducement for the Company to grant the loan,
the Pledgor has agreed, Company a security interest in the Common Shares and any
proceeds thereof to secure the loan pursuant to this Pledge Agreement.

NOW, THEREFORE, in consideration of the mutual promises, covenants and
conditions, hereinafter set forth and for other good and valuable consideration,
the receipt and adequacy of which is hereby expressly acknowledged, the parties
hereto agree as follows:

(a) INDEBTEDNESS SECURED. This Pledge Agreement is executed to secure
the indebtedness of the Pledgor to the Company.

(b) PLEDGE OF COLLATERAL. The Pledgor hereby pledges, assigns,
transfers, sets over, delivers and grants to the Company, subject to Section 4,
a first priority security interest in and to the Common Shares and any proceeds
thereof including, without limitation, any and all dividends (other than
dividends for taxes), cash, instruments and other property from time to time
received, receivable, or otherwise distributed in respect of, or in exchange
for, any of the Common Shares (such proceeds and the Common Shares are
collectively, the "Collateral"). Pledgor is delivering the Common Shares to the
Company, for the purpose of holding said Common Shares as pledge holder pursuant
to the terms of this Pledge Agreement. The Company shall have no right in and to
the Collateral except as

provided in this Pledge Agreement, and the Company shall not have any right to
encumber or dispose of the Collateral except in accordance with the provisions
of this Pledge Agreement.

2. REPRESENTATIONS, WARRANTIES AND COVENANTS. Pledgor hereby represents
to the Company as follows: (i) the Pledgor has the capacity to enter into this
Pledge Agreement and to pledge the Common Shares to the Company hereunder, (ii)
Pledgor owns the Common Shares free and clear of any and all liens, charges,
encumbrances and security interests thereon, (iii) the Common Shares are validly
issued, fully paid and non-assessable, and (iv) no authorization, approval, or
other action by, and no notice to or filing with, any governmental authority or
regulatory body is required either (a) for the pledge by the Pledgor of the
Common Shares pursuant to this Pledge Agreement or for the execution, delivery
or performance of this Pledge Agreement by the Pledgor, or (b) for the exercise
by the Company of the rights provided for in this Pledge Agreement or the
remedies in respect of the Common Shares pursuant to this Pledge Agreement
(except as may be required in connection with such disposition by laws affecting
the offering and sale of securities generally). Pledgor also represents that
Pledgor is solvent at the time of the execution of this Agreement and that
Pledgor is benefitting from the Pledge; and that it has received reasonable
equivalent value for pledging the shares as security for the Loan from the
Company to the Pledgor.

3. DIVIDEND AND VOTING RIGHTS. So long as no Default (as defined
herein) has occurred and is continuing, the Common Shares shall be treated as
stock of the Pledgor, and the Pledgor shall be entitled to vote such shares and
to receive all dividends and distributions thereon.

4. ADJUSTMENTS. In the event that, during the term of this Pledge
Agreement, any stock dividend, reclassification, readjustment, or other change
is declared or made in the capital structure of the Company, all new,
substituted, and additional shares, or other securities, issued in respect of
the Common Shares by reason of any such change shall be held by the Company,
subject to the lien of this Pledge Agreement and under the terms of this Pledge
Agreement in the same manner as the Common Shares pledged hereunder.

5. PAYMENT OF INDEBTEDNESS. Upon payment of the principal and interest
of the indebtedness, the Company shall execute and deliver a confirmation of the
termination of this Pledge Agreement and the Common Shares shall be returned to
the Pledgor. Upon full payment of the principal and interest of the
indebtedness, this Pledge Agreement shall become null and void.

6. DEFAULT. Upon the occurrence of each of the following events, the
Company shall be entitled to effect the immediate repayment of all sums that are
and/or shall be owed in any manner whatsoever by the Pledgor to the

Company and such sums shall bear interest at the Maximum Interest Rate
prevailing, from the date that such event has occurred until total repayment by
the Pledgor:

(a) If, on due date, the Pledgor has not paid any principal or
interest or expenses including any levies, taxes and fees or any other
sums.

(b) If the Pledgor breaches or fails to uphold any of the terms
contained in this or any other document or deed that has been or shall
be signed on his behalf or it becomes evident that any of the
declarations that have been or shall be made on behalf of the Pledgor
in this or any other document is incorrect, or inaccurate.

(c) If a petition is filed requesting the appointment of a
temporary or permanent receiver, or a temporary or permanent receiver
or manager, or a Receiving Order against the Pledgor is issued over the
assets of the Pledgor and/or Pledgor or any portion of the assets of
the Pledgor.

(d) If a temporary or permanent receiver or receiver and manager
for all or any portion of the assets of the Pledgor is appointed.

(e) If any competent court in Maryland or Florida or elsewhere
institutes attachments or execution or any like proceedings against any
portion of the assets of the Borrower or if attachment or execution or
any like proceedings are instituted over all or any portion of the
Collateral which has been or shall be furnished to the Company.

(f) If the Company, at its absolute discretion, deems that since
the signing of this Agreement a change has occurred in the condition of
the Pledgor to which the Company had not given its prior written
consent. Without derogating from the generally of the foregoing, the
following acts shall be deemed to constitute a change in the condition
of the Pledgor:

(i) a voluntary or other transfer of shares (except the
transfer of shares by succession) which affect or are likely to
affect the condition of the Pledgor.

(g) If the Borrower ceases to pay debts or manage its affairs or
reaches a compromise or arrangement with its creditors.

(h) If the Company, at its discretion, deems that some event
occurred that has or might impair the financial position of the
Pledgor.

In addition to all remedies provided herein and according to law, the Company
shall have the following remedies: PRIVATE SALES: (a) The Pledgor recognizes
that the Company may be unable to effect a public sale of any or all the Pledged
Stock, by reason of certain prohibitions contained in the Securities Act and
applicable state securities laws or otherwise, and may be compelled to resort to
one or more private sales thereof to a restricted group of purchasers which will
be obliged to agree, among other things, to acquire such securities for their
own account for an investment and not with a view to the distribution or resale
thereof. The Pledgor acknowledges and agrees that any such private sale may
result in prices and other terms less favorable than if such sale were a public
sale and, not withstanding such circumstances, agrees that any such private sale
shall be deemed to have been made in a commercially reasonable manner. The
Company shall be under no obligation to delay a sale of any of the Pledged Stock
for the period of time necessary to permit the Issuer thereof to register such
securities for the public sale under the Securities Act, or under applicable
state securities laws, even if such Issuer would agree to do so.

(b) The Pledgor further agrees to use commercially reasonable efforts
to do so or cause to be done all such other acts as may be necessary to make
such sale or sales of all or any portion of the Pledged Stock pursuant to this
Section valid and binding and in compliance with any and all other applicable
requirements of law.

6. NOTICES. All notices, requests, demands or other communications which
are required or permitted to be given hereunder shall be in writing and shall be
deemed to have been duly given when they are made by facsimile and shall be
deemed to be sufficient made if addressed as follows:

If to the Pledgor: HOWARD SIPZNER
1696 NE Miami Gardens Drive Suite 200
North Miami Beach, FL 33179
Phone 305-947-1664
Facsimile 305-947-1734

with a copy to: Estee Kornblum, Esquire
385 Donmoor Road
Lawrence, NY 11559
Phone 516-569-7686
Facsimile 212-506-5151

If to the Company Equity One, Inc.
Attention: Chaim Katzman
1696 NE Miami Gardens Drive Suite 200
North Miami Beach, FL 33179
Phone 305-947-1664
Facsimile 305-947-1734

with a copy to: Alan J. Marcus, Esquire
20803 Biscayne Blvd. Suite 301
Aventura, FL 33180
Phone 305-937-1800
Facsimile 305-937-1857

and any such facsimile properly addressed and sent shall be deemed to have been
received within twelve (12) hours after the time of sending. In addition, all
notices shall also be sent by courier or messenger, although failure to do so
shall not invalidate the facsimile notice.

7. GOVERNING LAW AND JURISDICTION. This Pledge Agreement shall be governed
by and construed in accordance with the laws of the State of Florida.

8. VENUE. The parties hereby select the Miami Dade County as the place of
jurisdiction for any legal proceeding arising pursuant to this Pledge Agreement.

IN WITNESS WHEREOF, this Pledge Agreement has been duly executed on the
day and year first written above.

PLEDGOR:

/s/ HOWARD SIPZNER
---------------------------------------
HOWARD SIPZNER

EQUITY ONE, INC.,
A Maryland Corporation

BY: /s/ CHAIM KATZMAN
------------------------------------
CHAIM KATZMAN, Chief Executive Officer

STATE OF FLORIDA

COUNTY OF MIAMI DADE

I HEREBY CERTIFY that on this day personally appeared before me, an
officer duly authorized to administer oaths and take acknowledgments, HOWARD
SIPZNER, ( ) known to me to be the person described in or ( ) who produced
____________________________ as identification, and who executed the foregoing
instrument, and acknowledged before me that he executed the same.

WITNESS my hand and official seal, this 1st day of April , 2002.

/s/ MICHELE L. GUARD
-------------------------------
(Notary Seal) NOTARY PUBLIC
My commission expires: 6/14/2002
No. CC 750963
[X] Personally Known [ ] Other I.D.

STATE OF FLORIDA

COUNTY OF MIAMI DADE

I HEREBY CERTIFY that on this day personally appeared before me, an
officer duly authorized to administer oaths and take acknowledgments, CHAIM
KATZMAN, Chief Executive Officer of EQUITY ONE, INC.( ) known to me to be the
person described in or ( ) who produced ____________________________ as
identification, and who executed the foregoing instrument, and acknowledged
before me that he executed the same.

WITNESS my hand and official seal, this 1st day of April, 2002.

/s/ MICHELE L. GUARD
-------------------------------
(Notary Seal) NOTARY PUBLIC
My commission expires: 6/14/2002
No. CC 750963
[X] Personally Known [ ] Other I.D.