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, 2003

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
- --------------------------------------------------------------------------------
(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 [ ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2 of the Exchange). Yes [X] No [ ]

Applicable only to Corporate Issuers:

As of the close of business on May 6, 2003, 60,048,413 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
------------------------------

Item 1. Condensed Consolidated Financial Statements Page
-----

Condensed Consolidated Balance Sheets-
As of March 31, 2003 and December 31, 2002 (unaudited)........... 1

Condensed Consolidated Statements of Operations -
For the three-month periods ended March 31, 2003 and 2002
(unaudited) ...................................................... 3

Condensed Consolidated Statements of Comprehensive Income -
For the three-month periods ended March 31, 2003 and 2002
(unaudited) ...................................................... 5

Condensed Consolidated Statements of Stockholders' Equity -
For the three-month period ended March 31, 2003 (unaudited) ..... 6

Condensed Consolidated Statements of Cash Flows - For the
three-month periods ended March 31, 2003 and 2002 (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 .......................................... 19

Item 3. Quantitative and Qualitative Disclosures about Market Risk ...... 25

Item 4. Controls and Procedures.......................................... 26

PART II - OTHER INFORMATION

Item 1. Legal Proceedings ............................................... 27

Item 2. Changes in Securities and Use of Proceeds ....................... 27

Item 3. Defaults upon Senior Securities ................................. 27

Item 4. Submission of Matters to a Vote of Security Holders ............. 27

Item 5. Other Information ............................................... 28

Item 6. Exhibits and Reports on Form 8-K ................................ 28

Signatures ............................................................... 29

PART I - FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

EQUITY ONE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 2003 AND DECEMBER 31, 2002
(UNAUDITED)
(In thousands, except per share amounts)
- -----------------------------------------------------------------------------

March 31, December 31,
2003 2002
------------- --------------
ASSETS

PROPERTIES:
Income producing ............................................................ $ 1,407,823 $ 682,941
Less: accumulated depreciation .............................................. (45,203) (40,433)
----------- -----------
1,362,620 642,508

Construction in progress and land held for development ...................... 37,244 35,923
Properties held for sale .................................................... 5,668 --
----------- -----------

Properties, net .......................................................... 1,405,532 678,431

CASH AND CASH EQUIVALENTS ...................................................... 2,679 2,944

CASH HELD IN ESCROW ............................................................ 12,910 5,933

ACCOUNTS AND OTHER RECEIVABLES, NET ............................................ 7,236 7,053

INVESTMENTS IN AND ADVANCES TO JOINT VENTURES .................................. 9,832 10,021

GOODWILL ....................................................................... 22,535 2,276

OTHER ASSETS ................................................................... 28,484 23,411
----------- -----------

TOTAL .......................................................................... $ 1,489,208 $ 730,069
=========== ===========
(continued)

March 31, December 31,
2003 2002
-------------- ---------------
LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:

NOTES PAYABLE
Mortgage notes payable .......................................................$ 422,311 $ 332,143
Revolving credit facilities .................................................. 169,000 23,000
Unsecured senior notes payable ............................................... 150,000 --
----------- -----------
741,311 355,143
Unamortized premium on notes payable ......................................... 21,982 --
----------- -----------
Total notes payable ....................................................... 763,293 355,143

OTHER LIABILITIES
Accounts payable and accrued expenses ........................................ 21,695 14,760
Tenant security deposits ..................................................... 6,806 4,342
Other liabilities ............................................................ 2,112 1,724
----------- -----------
Total liabilities ......................................................... 793,906 375,969
----------- -----------
MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES .................................. 15,793 3,869
----------- -----------

COMMITMENTS AND CONTINGENT LIABILITIES

STOCKHOLDERS' EQUITY:
Preferred stock, $0.01 par value - 10,000 shares authorized but unissued ..... -- --
Common stock, $0.01 par value - 100,000 shares authorized, 59,755 and 34,540 . 8 5
shares issued and outstanding for 2003 and 2002, respectively ............. 59 34
Additional paid-in capital ................................................... 689,855 355,450
Retained earnings ............................................................ 2,183 5,969
Accumulated other comprehensive loss ......................................... (47) (46)
Unamortized restricted stock compensation .................................... (5,968) (4,375)
Notes receivable from issuance of common stock ............................... (7,112) (7,112)
----------- -----------
Total stockholders' equity ................................................ 679,509 350,231
----------- -----------
TOTAL ...........................................................................$ 1,489,208 $ 730,069
=========== ===========

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, 2003 AND 2002
(UNAUDITED)
(In thousands, except per share amounts)
- --------------------------------------------------------------------------------

Three Months Ended March 31,
-----------------------------
2003 2002
------------- ------------

RENTAL INCOME:
Minimum rental ............................................................ $ 28,933 $ 17,968
Expense recoveries ........................................................ 8,009 6,210
Termination fees .......................................................... 59 123
Percentage rent payments .................................................. 1,013 941
-------- --------
Total rental revenue .................................................... 38,014 25,242

MANAGEMENT FEES ............................................................... 63 98

INVESTMENT INCOME ............................................................. 531 413
-------- --------

Total revenues .......................................................... 38,608 25,753
-------- --------
COSTS AND EXPENSES:
Property operating expenses ................................................ 11,054 7,790
Interest expense ........................................................... 7,719 6,112
Amortization of deferred financing fees .................................... 286 208
Rental property depreciation and amortization .............................. 5,013 3,288
General and administrative expenses ........................................ 2,241 2,008
-------- --------

Total costs and expenses ............................................... 26,313 19,406
-------- --------
INCOME BEFORE EQUITY IN INCOME OF JOINT VENTURES, LOSS ON
EXTINGUISHMENT OF DEBT, AND MINORITY INTEREST IN CONSOLIDATED
SUBSIDIARIES ............................................................... 12,295 6,347

EQUITY IN INCOME OF JOINT VENTURES ............................................ 111 151

LOSS ON EXTINGUISHMENT OF DEBT ................................................ (623) --
-------- --------
INCOME BEFORE MINORITY INTEREST IN CONSOLIDATED
SUBSIDIARIES ............................................................... 11,783 6,498

MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES ................................ (141) (25)
-------- --------

INCOME FROM CONTINUING OPERATIONS ............................................. 11,642 6,473
-------- --------
DISCONTINUED OPERATIONS
Income from operations of sold properties .................................. 199 672
Gain on disposal of income producing properties ............................ 503 6,122
-------- --------
Total income from discontinued operations ................................ 702 6,794
-------- --------
NET INCOME .................................................................... $ 12,344 $ 13,267
======== ========
(Continued)

Three Months Ended March 31,
-----------------------------
2003 2002
------------ ------------
EARNINGS PER SHARE:

BASIC EARNINGS PER SHARE
Income from continuing operations....................................... $ 0.25 $ 0.22
Income from discontinued operations..................................... 0.01 0.23
----------- ------------

Total basic earnings per share........................................ $ 0.26 $ 0.45
=========== ============

NUMBER OF SHARES USED IN COMPUTING
BASIC EARNINGS PER SHARE................................................ 47,163 29,354
=========== ============

DILUTED EARNINGS PER SHARE
Income from continuing operations....................................... $ 0.25 $ 0.22
Income from discontinued operations..................................... 0.01 0.22
----------- ------------

Total diluted earnings per share...................................... $ 0.26 $ 0.44
=========== ============

NUMBER OF SHARES USED IN COMPUTING
DILUTED EARNINGS PER SHARE.............................................. 48,475 30,029
=========== ============

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

EQUITY ONE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2003 AND 2002
(UNAUDITED)
(In thousands, except per share amounts)
- --------------------------------------------------------------------------------

Three Months Ended March 31,
-----------------------------
2003 2002
------------ ------------

NET INCOME................................................................... $ 12,344 $ 13,267

OTHER COMPREHENSIVE (LOSS) INCOME:
Net unrealized holding (loss) gain on securities available for sale...... (1) 7
------------ ------------

COMPREHENSIVE INCOME......................................................... $ 12,343 $ 13,274
============ ============

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, 2003
(UNAUDITED)
(In thousands, except per share amounts)
- --------------------------------------------------------------------------------

Accumulated Notes
Other Unamortized Receivable
Additional Comprehensive Restricted from the Total
Common Paid-In Retained (Loss)/ Stock Issuance of Stockholders'
Stock Capital Earnings Income Compensation Common Stock Equity
--------- --------- --------- ------------ ----------- ------------ ------------

BALANCE,
JANUARY 1, 2003....... $ 345 $ 355,450 $ 5,969 $ (46) $ (4,375) $ (7,112) $ 350,231

Issuance of common
stock:
IRT transaction.... 175 231,562 - - - - 231,737

Other issuances.... 78 103,166 - - (1,593) - 101,651

Stock issuance costs - (323) - - - - (323)

Net income........... - - 12,344 - - - 12,344

Dividends paid....... - - (16,130) - - - (16,130)

Net unrealized holding
loss on securities
available for sale... - - - (1) - - (1)
--------- --------- --------- ----------- ----------- ------------ ------------

BALANCE,
MARCH 31, 2003........ $ 598 $ 689,855 $ 2,183 $ (47) $ (5,968) $ (7,112) $679,509
========= ========= ========= =========== =========== ============ ============

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, 2003 AND 2002
(UNAUDITED)
(In thousands, except per share amounts)
- --------------------------------------------------------------------------------

Three Months Ended March 31,
-------------------------------
2003 2002
------------ ------------

OPERATING ACTIVITIES:
Net income............................................................ $ 12,344 $ 13,267
Adjustments to reconcile net income to net cash provided by
operating activities:
Straight line rent adjustment.................................... (333) (32)
Provision for losses on accounts receivable...................... 648 163
Amortization of premium on notes payable......................... (329) -
Amortization of deferred financing fees.......................... 286 208
Rental property depreciation and amortization.................... 5,013 3,288
Depreciation and amortization included in discontinued operations 33 41
Amortization of restricted stock................................. 480 269
Equity in income of joint ventures............................... (111) (151)
Loss on debt extinguishment...................................... 623 -
Minority interest in earnings of consolidated subsidiary......... 141 25
Gain on disposal of real estate.................................. (503) (6,122)
Changes in assets and liabilities:
Accounts and other receivables.................................. 980 1,755
Other assets.................................................... (2,257) (722)
Accounts payable and accrued expenses........................... (5,154) 6
Tenants' security deposits...................................... 255 (222)
Other liabilities............................................... (64) (586)
------------ ------------
Net cash provided by operating activities............................. 12,052 11,187
------------ ------------
INVESTING ACTIVITIES:
Additions to and purchase of rental property....................... (8,738) (12,469)
Proceeds from disposal of rental property.......................... 6,694 8,847
Increase in cash held in escrow.................................... (13) (6,049)
Distributions received from joint ventures......................... 300 56
Proceeds from repayments of notes receivable....................... 2,753 (58)
Increase in deferred leasing costs................................. (692) -
Cash used in the purchase of IRT................................... (189,382) -
Cash acquired in the IRT acquisition............................... 1,756 -

------------ ------------
Net cash used in investing activities........................... (187,322) (9,673)
------------ ------------
FINANCING ACTIVITIES:
Repayments of mortgage notes payable............................... (46,009) (28,673)
Net borrowings (repayments) under revolving credit facilities...... 138,000 (18,409)
Increase in deferred financing costs............................... (559) (511)
Proceeds from stock subscription and issuance of common stock...... 100,276 57,302
Stock issuance costs............................................... (323) (790)
Cash dividends paid to stockholders................................ (16,130) (8,010)
Distributions to minority interest................................. (250) (25)
------------ ------------
Net cash provided by financing activities............................. 175,005 884
------------ ------------

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS.................. (265) 2,398

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD........................ 2,944 906
------------ ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD.............................. $ 2,679 $ 3,304
============ ============

See accompanying notes to the condensed consolidated financial statements.

Three Months Ended March 31,
-------------------------------
2003 2002
------------ ------------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for interest, net of amount capitalized................. $ 6,945 $ 6,191
============ ============

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Change in unrealized holding (loss) gain on securities available for $ (1) $ 7
sale...............................................................
============ ============
Issuance of restricted stock....................................... $ 2,967 $ 427
============ ============
Common stock issued for note receivable............................. $ 866
============
Note receivable from sale of property............................... $ 1,425
============

The Company acquired all of the outstanding common stock of IRT for $763,047,
including transaction costs:

Fair value of assets acquired, including goodwill.................. $ 763,047
Fair value of liabilities assumed.................................. (341,928)
Common stock issued................................................. (231,737)
------------

Cash paid for IRT acquisition, including transaction costs......... $ 189,382
============
(Concluded)

EQUITY ONE, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2003 AND 2002
(UNAUDITED)
(In thousands, except per share amounts)

1. Organization
------------

Equity One, Inc. operates as a self-managed real estate investment trust
("REIT") that principally acquires, renovates, develops and manages community
and neighborhood shopping centers located predominately in high growth markets
in the southern United States. These shopping centers are primarily anchored by
supermarkets or other necessity-oriented retailers such as drug stores or
discount retail stores.

The condensed consolidated financial statements include the accounts of
Equity One, Inc. and its wholly-owned subsidiaries and those partnerships where
the Company has financial and operating control. Equity One, Inc. and
subsidiaries are hereinafter referred to as "the consolidated companies" or "the
Company." The Company has a 50% investment in three joint ventures and a 50.1%
interest in one joint venture of which it does not have financial or operating
control and, accordingly, uses the equity method of accounting for these joint
ventures.

As of March 31, 2003, the Company's portfolio of neighborhood shopping
centers anchored by national and regional supermarket chains and other necessity
oriented retailers such as drug store, or discount stores are located in twelve
states in the southern United States and consists of 179 properties,
encompassing 122 supermarket-anchored shopping centers, eight drug
store-anchored shopping centers, 42 other retail-anchored shopping centers, one
self-storage facility, one industrial property, and five retail developments, as
well as non-controlling interests in four joint ventures which own and operate
commercial real estate properties.

On February 12, 2003, the Company completed a statutory merger with IRT
Property Company ("IRT"). In connection with the merger, the Company acquired 92
properties that comprise an aggregate of approximately 10,000 square feet of
gross leasable area. The aggregate purchase price for the acquisition was
$763,047 (including transaction costs and assumed debt), consisting of the
payment of $189,382 in cash, issuance of 17,490 shares of the Company's common
stock valued at $231,737 and assumption of $341,928 of outstanding debt, premium
on notes payable, and other liabilities. The Company has recorded $20,259 of
goodwill as a result of the acquisition. The acquisition of IRT was accounted
for using the purchase method and the results of IRT are included in the
Company's financial statements from the date of its acquisition. The fair values
assigned to the identifiable tangible and intangible assets and liabilities are
preliminary as the Company is evaluating the fair values and allocation of
costs. Management does not believe that any adjustment would have a material
effect on the Company's financial position or results of operations.

On February 12, 2003, the cash portion of the purchase price was partially
financed by proceeds of $93,200 from a private placement offering to certain
existing affiliates of 6,911 shares of the Company's common stock at a price of
$13.50 per share. The balance of the cash consideration was funded from a new
revolving credit facility described below.

On February 7, 2003, the Company entered into a $340,000 unsecured
revolving credit facility. This facility bears interest at our option at (i)
LIBOR plus 0.65% to 1.35%, depending on the credit ratings of our senior
unsecured long term indebtedness or (ii) at the greater of (x) Wells Fargo's
prime rate and (y) the Federal Funds Rate plus 0.5%. The Company used available
funds under this credit facility to pay part of the cash consideration which was
paid to the IRT shareholders, to pay transaction expenses and to repay certain
outstanding indebtedness.

The following unaudited supplemental pro forma information is presented to
reflect the effects of the IRT acquisition and related transactions, and the
impact on the Company's results, as if the transactions had occurred on January
1, 2002. The pro forma information includes the acquisition of IRT, the issuance
of common stock related to the IRT transaction, the private placement of common
stock and the borrowing on the revolving credit facility. The pro forma
financial information is presented for informational purposes only and may not
be indicative of what the actual results of operations would have been had the
acquisition occurred as indicated, nor does it purport to represent the results
of the operations for future periods:

Three Months Ended March 31,
-----------------------------

2003 2002
----------- -----------

Pro forma revenues....................................... $ 49,091 $ 47,905
=========== ===========
Pro forma income from continuing operations............... $ 14,002 $ 12,883
=========== ===========
Pro forma net income..................................... $ 14,704 $ 19,755
=========== ===========
Pro forma earnings per share:
Basic earnings per share:
Income from continuing operations..................... $ 0.24 $ 0.24
Income from discontinued operations................... 0.01 0.13
----------- -----------
Total basic earnings per share.................... $ 0.25 $ 0.37
=========== ===========

Diluted earnings per share:
Income from continuing operations.................... $ 0.24 $ 0.24
Income from discontinued operations.................. 0.01 0.12
----------- -----------
Total diluted earnings per share.................. $ 0.25 $ 0.36
=========== ===========

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 (the "SEC").
Accordingly, these unaudited 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 considered necessary
for a fair presentation have been included. The results of operations for the
three-month period ended March 31, 2003 are not necessarily indicative of the
results that may be expected for the full year. These unaudited condensed
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 with the Company's Management's
Discussion and Analysis of Financial Condition and Results of Operations and
audited financial statements and related footnotes, included in the Company's
2002 Annual Report on Form 10-K filed with the SEC on March 31, 2003.

The preparation of condensed consolidated financial statements in
conformity with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect the
amounts reported in the consolidated financial statements and accompanying
notes. Actual results could differ from those estimates.

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

Certain amounts as previously reported have been reclassified to conform to
the current period's presentation.

3. Rental Property
---------------

Income producing property is stated at cost and includes all costs related
to acquisition, development and construction, including tenant improvements,
interest incurred during development, costs of pre-development and certain
direct and indirect costs of development. Costs incurred during the
predevelopment stage are capitalized once management has identified a site,
determined that the project is feasible and it is probable that the Company is

able to proceed with the project. Expenditures for ordinary maintenance and
repairs are expensed to operations as they are incurred. Significant renovations
and improvements, which improve or extend the useful life of assets, are
capitalized.

Income producing properties are individually evaluated for impairment when
various conditions exist that may indicate that it is probable that the sum of
expected future cash flows (on an undiscounted basis) from a property is less
than its historical net cost basis. Upon determination that a permanent
impairment has occurred, the Company records an impairment charge equal to the
excess of historical cost basis over fair value. In addition, the Company writes
off costs related to predevelopment projects when it determines that it will no
longer pursue the project.

Depreciation expense is computed using the straight-line method over the
estimated useful lives of the assets, as follows:

Land improvements 40 years
Buildings 30-40 years
Building improvements 5-40 years
Tenant improvements Over the terms of the related lease
Equipment 5-7 years

Total interest expense capitalized to construction in progress and land
held for development was $684 and $512 for the three months ended March 31, 2003
and 2002, respectively.

4. Property Held for Sale
----------------------

As of March 31, 2003, one rental retail property and three outparcels were
classified as property held for sale. The rental retail property has an
aggregate gross leasable area of 81 square feet.

5. Investments in and Advance to Joint Ventures
--------------------------------------------

A summary of the Company's investments in and advances to joint ventures at
March 31, 2003 and December 31, 2002 is as follows (all investments in
unconsolidated entities are accounted for under the equity method):

March 31, December 31,
Entity Location Ownership 2003 2002
- ---------------------------- ------------------------ ---------- ----------- ------------
PG Partners................. Palm Beach Gardens, FL 50.0% $ 2,778 $ 2,823
Parcel F, LLC............... Palm Beach Gardens, FL 50.0% 228 228
Oaksquare JV................ Gainesville, FL 50.0% 1,243 1,243
CDG (Park Place) LLC........ Plano, TX 50.1% 5,583 5,727
---------- ------------
Total investments in and advances to joint ventures....................... $ 9,832 $ 10,021
=========== ============

A summary of unaudited financial information for all joint ventures being
reported on the equity method of accounting is as follows:

As of As of
March 31, 2003 December 31, 2002
---------------- -----------------

Assets:
Rental properties, net................ $ 47,012 $ 47,309
Cash and cash equivalents............. 705 690
Other assets.......................... 1,069 1,170
---------------- -----------------
Total assets.......................... $ 48,786 $ 49,169
================ =================
Liabilities and Ventures' Equity:
Mortgage notes........................ $ 44,553 $ 44,625
Other liabilities..................... 494 651
Ventures' equity...................... 3,739 3,893
---------------- -----------------
Total ................................ $ 48,786 $ 49,169
================ =================

The Company's investments in joint ventures, as reported on the condensed
consolidated balance sheets, differ from its proportionate share of the joint
ventures' underlying net assets due to basis differentials and advances. The
basis differential of approximately $5,000 is being depreciated over the useful
lives of the related assets.

As of March 31, 2003, the Company has guaranteed the mortgage note payable
of $15,000 for one of its joint ventures.

Three Months Ended
March 31,
---------------------
2003 2002
-------- --------

Revenues:
Rental revenues .................................. $1,778 $1,832
Other revenues ................................... 124 15
------ ------
Total revenues ................................. 1,902 1,847
------ ------
Expenses:
Operating expenses ............................... 512 418
Interest expense ................................. 699 750
Depreciation ..................................... 322 349
Other expense .................................... 147 28
------ ------

Total expenses ................................. 1,680 1,545
------ ------

Net income ......................................... $ 222 $ 302
====== ======
The Company's equity in income of joint ............ $ 111 $ 151
ventures ====== ======

Significant accounting policies used by the unconsolidated joint ventures
are similar to those used by the Company.

6. Borrowings

Each of the existing mortgage loans is secured by a mortgage on one or more
of certain of the Company's properties. Certain of the mortgage loans involving
an aggregate principal balance of approximately $171,000 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. To date, no lender has
notified the Company that it intends to accelerate its mortgage. Nevertheless,
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 will 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.

On February 7, 2003 the Company entered into a $340,000 unsecured revolving
credit facility with a group of banks for which Wells Fargo Bank, National
Association is the sole lead arranger and administrative agent. This facility
bears interest at the Company's option at (i) LIBOR plus 0.65% to 1.35%,
depending on the credit ratings of the Company's senior unsecured long term
indebtedness or (ii) at the greater of (x) Wells Fargo's prime rate and (y) the
Federal Funds Rate plus 0.5%. The facility also includes a competitive bid
option which allows the Company to conduct auctions among the participating
banks for borrowings in an amount not to exceed $150,000, a $25,000 swing line
facility for short term borrowings and a $20,000 letter of credit commitment.
The facility expires February 12, 2006 with a one year extension option. In
addition, the facility contains customary covenants, including financial
covenants regarding debt levels, total liabilities, interest coverage, EBITDA
levels, unencumbered properties, permitted investments and others. The facility
also prohibits stockholder distributions in excess of 95% of funds from
operations calculated at the end of each fiscal quarter for the four fiscal
quarters then ending. Notwithstanding this limitation, the Company can make
stockholder distributions to avoid income taxes on asset sales. If a default
under the facility exists, the Company `s ability to pay dividends would be
limited to the
12

amount necessary to maintain the Company's status as a REIT unless the default
is a payment default or bankruptcy event in which case the Company would be
prohibited from paying any dividends. The facility is guaranteed by several of
the Company's wholly-owned subsidiaries. As of March 31, 2003, the Company had
$169,000 outstanding on this credit facility. The weighted average interest rate
as March 31, 2003 was 2.29%.

As a result of the Company's merger with IRT, the Company assumed IRT's
obligations relating to $150,000 principal amount of Senior Notes, bearing
interest at fixed annual interest rates ranging from 7.25% to 7.84% and maturing
between 2006 and 2012. The interest rate of one series of these Senior Notes is
subject to a 50 basis point increase if the Company does not maintain its senior
unsecured debt rating. These notes have also been guaranteed by the Company's
wholly-owned subsidiaries.

Also, as part of the Company's merger with IRT, the Company assumed
$135,397 of mortgage notes payable.

As of March 31, 2003, the Company had a $5,000 unsecured credit facility
with City National Bank of Florida and no amounts were outstanding on this
credit facility. This facility secures $1,183 in outstanding letters of credit.

7. Consolidating Financial Information
-----------------------------------

As of March 31, 2003, the Company and substantially all of the
subsidiaries, including IRT Partners LP, has guaranteed the Company's
indebtedness under the unsecured senior debt. The guarantees are joint and
several and full and unconditional.

Guarantors
------------------------------
Condensed Balance Sheet Equity Combined IRT Eliminating Consolidated
One, Inc. Subsidiaries Partners, LP Entries Equity One
------------ ------------- ------------- ------------ -------------
As of March 31, 2003

ASSETS
Properties, net.................. $ 540,284 $ 680,986 $ 184,262 $ - $ 1,405,532
Investment in affiliates......... 430,681 - - (430,681) -
Other assets..................... 35,285 42,307 6,084 - 83,676
------------ ------------- ------------ ------------ -------------
Total assets................... $ 1,006,250 $ 723,293 $ 190,346 $ (430,681) $ 1,489,208
============ ============= ============ ============ =============

LIABILITIES
Mortgage notes payable........... 94,998 292,461 34,852 - 422,311
Revolving credit facilities...... 169,000 - - - 169,000
Senior notes, net................ 150,000 - - - 150,000
Unamortized premium on notes
payable.......................... 21,982 - - 21,982
Other liabilities.................. 11,511 17,517 1,585 - 30,613
------------ ------------- ------------ ------------ -------------

Total liabilities................ 447,491 309,978 36,437 - 793,906
------------ ------------- ------------ ------------ -------------
MINORITY INTEREST.................. - - - 15,793 15,793
------------ ------------- ------------ ------------ -------------

STOCKHOLDER'S EQUITY
Total stockholders' equity....... 558,759 413,315 153,909 (446,474) 679,509
------------ ------------- ------------ ------------ -------------

Total liabilities and
shareholders' equity............. $ 1,006,250 $ 723,293 $ 190,346 $ (430,681) $ 1,489,208
============ ============= ============ ============ =============

Guarantors
------------------------------
Condensed Statement of Operations Equity One, Combined IRT Consolidated
Inc. Subsidiaries Partners, LP Equity One
------------ ------------- ------------- --------------
For the Three Months Ended March 31, 2003

RENTAL INCOME:
Minimal rental................................ $ 7,318 $ 19,155 $ 2,460 $ 28,933
Expense recoveries............................ 1,501 5,859 649 8,009
Termination fees.............................. 52 6 1 59
Percentage rent payments...................... 175 645 193 1,013
---------- ----------- ------------ -------------

Total revenues............................. 9,046 25,665 3,303 38,014

MANAGEMENT FEES - 63 - 63
INVESTMENT INCOME 261 209 61 531
---------- ----------- ------------ -------------
Total revenues............................. 9,307 25,937 3,364 38,608
---------- ----------- ------------ -------------

COSTS AND EXPENSES:
Property operating expenses.................. 2,484 7,631 939 11,054
Interest expense............................. 1,545 5,746 428 7,719
Amortization of deferred financing fees...... 114 170 2 286
Rental property depreciation and amortization 945 3,515 553 5,013
General and administrative expenses.......... 2,241 - - 2,241
---------- ----------- ------------ -------------
Total costs and expenses................... 7,329 17,062 1,922 26,313
---------- ----------- ------------ -------------

INCOME BEFORE EQUITY IN INCOME OR JOINT
VENTURES, LOSS ON EXTINGUISHMENT OF DEBT, AND
MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES 1,978 8,875 1,442 12,295

EQUITY IN INCOME OF JOINT VENTURES.............. - 111 - 111

LOSS ON EXTINGUISHMENT OF DEBT.................. - (623) - (623)
---------- ----------- ------------ -------------
INCOME BEFORE MINORITY INTEREST IN
CONSOLIDATED SUBSIDIARIES.................... 1,978 8,363 1,442 11,783

MINORITY INTEREST IN CONSOLIDATED SUBSIDIAREIS.. (55) (17) (69) (141)
---------- ----------- ------------ -------------

INCOME FROM CONTINUING OPERATIONS................ 1,923 8,346 1,373 11,642
---------- ----------- ------------ -------------
DISCONTINUED OPERATIONS
Income from operations of sold properties.... - 199 - 199
Gain on disposal of income producing - 3 - 3
properties................................... 503 503
---------- ----------- ------------ -------------
Total income from discontinued operations....... - 702 - 702
---------- ----------- ------------ -------------
NET INCOME ..................................... $ 1,923 $ 9,048 $ 1,373 $ 12,344
========== =========== ============ =============

8. Stockholders' Equity and Earnings Per Share
-------------------------------------------

The following table reflects the change in number of shares of common stock
outstanding for the three months ended March 31, 2003:

Common Options
Stock Exercised Total
--------- ---------- ---------

Board of Directors/Corporate Secretary...... 16 * - 16
Officers..................................... 167 * 88 255
Employees and other......................... 18 * 301 319
IRT acquisition.............................. 17,490 - 17,490
Private placement............................ 6,911 - 6,911
Dividend Reinvestment and Stock Purchase Plan 224 - 224
--------- --------- ---------
Total.................................. 24,826 389 25,215
========= ========= =========

* Reflects shares of "restricted stock" which are subject to forfeiture and
vest over a period of two to five years.

The following table sets forth the computation of basic and diluted shares
used in computing earnings per share for the three-month periods ended March 31,
2003 and 2002:

Three Months Ended March 31,
------------------------------
2003 2002
------------ ------------

Denominator for basic earnings per share - weighted 47,163 29,354
average shares ...................................
------------ ------------
Walden Woods Village, Ltd............................ 94 94
Unvested restricted stock ........................... 319 174
Convertible partnership units ....................... 672 262
Stock options (using treasury method)................ 227 145
------------ ------------
Subtotal.......................................... 1,312 675
------------ ------------
Denominator for diluted earnings per share - weighted 48,475 30,029
average shares.................................... ============ ============

9. Accounting for Stock Options
----------------------------

The Company applies the intrinsic value method as prescribed by Accounting
Principles Board Opinion No. 25, Accounting for Stock Issued to Employees, and
related interpretations in measuring stock-based compensation, including
options. Accordingly, no compensation expense has been recognized for options
granted under the Company's compensation plan as no grants were made at less
than market value. Had compensation expense been determined based upon the fair
value at the grant date for awards under the Plan consistent with SFAS No. 123,
Accounting for Stock-Based Compensation, the Company's net income and earnings
per share on a pro forma basis would have been:

Three Months Ended March 31,
----------------------------

2003 2002
----------- ------------

Net Income As reported.............. $ 12,344 $ 13,267

Stock based employee
compensation expense
included in reported net
income.................... - -

Total stock based
employee compensation
expense determined under
fair value based method
for all awards............ 169 78
----------- -----------

Pro forma................. $ 12,175 $ 13,189
=========== ===========
Basic earnings per share As reported............... $ 0.26 $ 0.45
=========== ===========
Pro forma................. $ 0.26 $ 0.45
=========== ===========
Diluted earnings per share As reported.............. $ 0.26 $ 0.44
=========== ===========
Pro forma................ $ 0.25 $ 0.44
=========== ===========

10. Loans to Executives
-------------------

As a result of certain provisions of the Sarbanes-Oxley Act of 2002, the
Company is generally prohibited from making loans to directors and executive
officers. Prior to the adoption of the Sarbanes-Oxley, the Company had loaned
$7,112 to various executives in connection with their exercise of options to
purchase shares of the Company's common stock. The notes bear interest at rates
ranging from 5% to 6.35%. Interest only is payable quarterly and the principal
is due between 2006 and 2009. In accordance with the provisions of the
Sarbanes-Oxley Act of 2002, there have been no material modifications to any of
the terms of the loans granted to our executives.

11. 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 in the accompanying condensed consolidated
balance sheet. 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 earnings
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 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.

The Company is the general partner of IRT Partners L.P. ("LP") and
maintains an indirect partnership interest through its wholly-owned subsidiary,
IRT Management Company. LP was formed by IRT in order to enhance the Company's
acquisition opportunities through a downreit structure. This structure offers
potential sellers the ability to make a tax-deferred sale of their real estate
properties in exchange for OP Units of LP. As of March 31, 2003, there were
734,267 OP Units outstanding held by partners not affiliated with the Company.
LP is obligated to redeem each OP Unit held by a person other than the Company,
at the request of the holder, for cash equal to the fair market value of a share
of the Company's common stock at the time of such redemption, provided that the
Company may elect to acquire any such OP Unit presented for redemption for one
common share of stock. Such limited partnership interest of 6% of LP held by
persons unaffiliated with the Company is reflected as a minority interest in the
consolidated subsidiaries in the accompanying condensed consolidated balance
sheets.

The Company also records a minority interest for the limited partners'
share of equity in two separate partnerships. The two partnerships in which the
Company has a general partner interest are Venice Plaza (75% interest) and North
Village Center (49% interest). The minority interest has been presented in the
accompanying condensed consolidated balance sheet.

12. Dispositions
------------

The Company has adopted SFAS No. 144, Accounting for the Impairment or
Disposal of Long-Lived Assets, effective January 1, 2002, and has included the
operations of properties sold and held for sale, as well as the 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.

The following table reflects properties being reported in discontinued
operations for the three-month periods ended March 31, 2003 and 2002:

Gross Sales Price
----------------------
Square
Feet/ Under Gain On
Property Location Date Sold Acres (ac) Sold Contract Sale
-------------------- ------------------ ------------ ------------ -------- ---------- ---------
2003 Dispositions
--------------------

Eckerd Leesburg, FL February 12,739 $ 4,050 $ - $ 325
Eckerd Melbourne, FL February 10,908 2,715 - 178
Pompano Pompano Beach, FL April 80,697 - 3,400 -
--------- --------- ---------
$ 6,765 $ 3,400 $ 503
========= ========= =========

2002 Dispositions
--------------------
First Quarter 2002

Equity One Office Miami Beach, FL February 28,780 $ 6,050 $ - $ 4,396
Olive land Miami, FL February 6.79ac 1,900 - 694
Benbrook Fort Worth, TX February 247,422 2,590 - 1,032
-------- --------- ---------
$ 10,540 $ - $ 6,122
======== ========= =========

The Company classified the results of operations from the properties sold
during 2002 and 2003 as income from discontinued operations in the accompanying
condensed consolidated statements of operations. The effect of the adoption of
SFAS No. 144 on the condensed consolidated statements of operations is shown
below.

Three Months Ended March 31,
----------------------------
2003 2002
--------- ---------

Rental income........................... $ 236 $ 798
--------- ---------
Operating expenses...................... 4 85
Depreciation............................ 33 41
--------- ---------
Total expenses.......................... 37 126
--------- ---------
Income from discontinued operations..... $ 199 $ 672
========= =========

13. Debt Extinguishment
-------------------

The Company prepaid various outstanding mortgage notes payable and incurred
repayment penalties of $623. The Company has adopted SFAS No. 145, Rescission of
FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
Technical Corrections, and is reporting the loss on extinguishment of debt as
part of ordinary income as it no longer meets the criteria for extraordinary
gain (loss) accounting treatment.

14. New Accounting Pronouncements and Changes
-----------------------------------------

In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements
No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections
which rescinds FASB Statement No. 4, Reporting Gains and Losses from
Extinguishment of Debt, and an amendment of that Statement, FASB Statement No.
64, Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements. It also
rescinds FASB Statement No. 44, Accounting for Intangible Assets of Motor
Carriers, and amends FASB Statement No. 13, Accounting for Leases. Finally SFAS
No. 145 amends other existing authoritative pronouncements to make various
technical corrections, clarify meanings, or describe their applicability under
changed conditions. The provisions related to the rescission of FASB Statement
No. 4 and its amendment Statement No. 64 are effective for fiscal years
beginning after May 15, 2002. The Company adopted SFAS No. 145 as of July 2002
and has reflected gains (losses) from extinguishment of debt as part of ordinary
income.

In November 2002, FASB issued FASB Interpretation No. 45 ("FIN 45"),
Guarantor's Accounting and Disclosure Requirements for Guarantees, Including
Indirect Guarantee's of Indebtedness of Other's (an interpretation of FASB
Statements No. 5, 57 and 107 and rescission of FASB Interpretation No. 34). FIN
45 clarifies the requirements of FASB Statement No. 5, Accounting for
Contingencies. It requires that upon issuance of a guarantee, the guarantor must
recognize a liability for the fair value of the obligation it assumes under that
guarantee regardless of whether or not the guarantor receives separate
identifiable consideration (i.e., a premium). The Company adopted the new
disclosure requirements, which are effective beginning with 2002 calendar
year-end financials. FIN 45's provisions for initial recognition and measurement
are effective on a prospective basis to guarantees issued or modified after
December 31, 2002. The adoption of FIN 45 did not have a material impact on the
Company's financial statements.

In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based
Compensation-Transition and Disclosure. This Statement provides alternative
methods of transition for a voluntary change to the fair value based method of
accounting for stock-based employee compensation and amends the disclosure
requirement of SFAS No. 123, Accounting for Stock-Based Compensation, to require
prominent disclosure in both annual and interim financial statements about the
effect of the method used on reported results. SFAS No. 148 is effective for
financial statements issued for fiscal years ending after December 15, 2002 and,
as it relates to Opinion No. 28, Interim Financial Reporting, the interim
periods beginning after December 15, 2002, although earlier application is
encouraged. The Company applies the intrinsic value method as prescribed by
Accounting Principles Board Opinion

No. 25, Accounting for Stock Issued to Employees, and related interpretations in
measuring stock-based compensation. The Company has adopted the disclosure
requirements of SFAS No. 148 in its financial statements.

In January 2003, FASB issued FASB Interpretation No. 46, Consolidation of
Variable Interest Entities ("FIN 46"), an interpretation of ABR 51. FIN 46
provides guidance on identifying entities for which control is achieved through
means other than through voting rights, variable interest entities ("VIE"), and
how to determine when and which business enterprises should consolidate the VIE.
In addition, FIN 46 requires both the primary beneficiary and all other
enterprises with a significant variable interest in a VIE to make additional
disclosures. The transitional disclosure requirements will take effect almost
immediately and are required for all financial statements issued after January
31, 2003. The consolidated provisions of FIN 46 are effective immediately for
variable interests in VIEs created after January 31, 2003. For variable
interests in VIEs created before February 1, 2003, the provisions of FIN 46 are
effective for the first interim period beginning after June 15, 2003. The
Company is evaluating the effect of FIN 46 on the financial statements.

15. Commitments and Contingencies
-----------------------------

As of March 31, 2003, the Company has pledged letters of credit totaling
$1,238 as additional security for certain financings and other activities.

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.

Following the execution of the merger agreement with IRT in October 2002,
three IRT shareholders filed three separate purported class action and
derivative suits in the Superior Court of Cobb County, State of Georgia, against
IRT, IRT's board of directors and Equity One alleging claims of breach of
fiduciary duty by the defendant directors, unjust enrichment and irreparable
harm. The complaints sought declaratory relief, an order enjoining consummation
of the merger, and unspecified damages. Although the Georgia court did not grant
the plaintiffs the equitable relief requested and permitted the completion of
the merger, two of these lawsuits, Greaves v. IRT Property Company, et. al. and
Phillips v. IRT Property Company, et. al., are still pending and second amended
complaints have been filed in each such suit. The third lawsuit was voluntarily
dismissed. On April 23, 2003, we filed motions to dismiss each of the
shareholders suits. Although we believe that these suits are without merit and
intend to continue to defend them vigorously, there can be no assurance that the
pending litigation will be resolved in our favor.

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, 2002 and
Management's Discussion and Analysis of Financial Condition and Results of
Operations appearing in the Company's Annual Report on Form 10-K for the year
ended December 31, 2002. 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,"
"Equity One," and the "Company" in this report refer collectively to Equity One,
Inc., and its subsidiaries, including joint ventures.

RESULTS OF OPERATIONS

On February 12, 2003, Equity One, Inc. and IRT Property Company completed a
statutory merger. The transaction has been accounted for as a purchase and the
results of Equity One include the activity of IRT for the period February 12,
2003 through March 31, 2003.

Three Months Ended March 31, 2003 Compared To Three Months Ended March 31, 2002

Total revenues increased by $12.9 million, or 49.9%, to $38.6 million in
2003 from $25.8 million in 2002. The following factors accounted for this
variance:

o The acquisition of IRT increased revenues by approximately $12.4
million;

o Properties acquired during 2002 increased revenues by approximately
$1.4 million; and

o Other property revenue decreased by $900,000 related to a decrease in
percentage rent, a decrease in expense recoveries and a decrease in
revenue for properties under redevelopment.

Property operating expenses increased by $3.3 million, or 41.9%, to $11.1
million for 2003 from $7.8 million in 2002. The following factors accounted for
this variance:

o The acquisition of IRT increased operating expenses by approximately
$3.2 million;

o Properties acquired during 2002 increased operating expenses by
approximately $600,000; and

o Other property operating expenses decreased by $500,000.

Rental property depreciation and amortization increased by $1.7 million, or
52.5%, to $5.0 million for 2003 from $3.3 million in 2002. The following factors
accounted for this variance:

o The acquisition of IRT increased depreciation and amortization by
approximately $1.5 million; and

o Properties acquired during 2002 increased depreciation and
amortization by approximately $200,000.

Interest expense increased by $1.6 million, or 26.3%, to $7.7 million for
2003 from $6.1 million in 2002.

o This increase was primarily due to interest expense of $2.7 million
relating to the assumption of mortgage loans and senior unsecured debt
in the acquisition of IRT,

o Interest incurred on the debt related to the acquisition of properties
made during 2002 of $386,000, and

o These increases to interest expense were partially offset by the
payoff of various loans decreasing interest expense by $1.3 million,
and an increase in capitalized interest of $170,000 related to
development activity.

General and administrative expenses increased by $233,000, or 11.6%, to
$2.2 million for 2003 from $2.0 million in 2002. Compensation and employer
related expenses increased by $476,000 and other general office expenses
increased by $313,000. These expenses were partially due to the staffing
resulting from the IRT acquisition. During 2002, we incurred a $556,000 write
off of preacquisition costs.

During 2003, we settled various mortgage notes payable and incurred
prepayment penalties of $623,000.

Minority interest increased by $116,000 due to minority interests assumed
in the acquisition of IRT.

We sold two properties during 2003 and held one property for sale which are
being reflected as discontinued operations for the three-month period ended
March 31, 2003 of $199,000. The sale of these two properties produced a gain of
$503,000 for 2003. The 2002 discontinued operations also include properties sold
during 2002. We recognized a gain of $6.1 million in 2002 related to a gain in
disposal of properties.

As a result of the foregoing, net income decreased by $923,000 or 7.0%, to
$12.3 million for 2003 to $13.3 million in 2002.

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 (determined in accordance
with accounting principles generally accepted in the United States of America
("GAAP"), excluding gains (losses) from sales of property, adjustments for
extraordinary items and cumulative effects of accounting changes, plus real
estate related depreciation and amortization, minority interest 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 our 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 for the three-month
periods ended March 31, 2003 and 2002:

Three Months Ended
March 31,
-----------------------
2003 2002
---------- ----------

Net income ....................................................... $ 12,344 $13,267
Adjustments:
Depreciation and amortization related to rental properties ... 5,046 3,329
Gain on disposal of real estate .............................. (503) (6,122)
Minority interest in earnings of consolidated subsidiaries.... 141 25
Other Items:
Interest on convertible partnership units .................... 65 65
Share of joint venture real estate depreciation .............. 161 174
--------- ---------

Funds from operations ............................................ $ 7,254 $10,738
========= =========

FFO increased by $6.5 million, or 60.7%, to $17.3 million for the three
months ended March 31, 2003, from $10.8 million for the comparable period of
2002. The increase is primarily the result of the inclusion of IRT's results for
the current period, and the increases in income described above.

CASH FLOW

Net cash provided by operations of $12.1 million for the three months ended
March 31, 2003 included: (i) net income of $12.3 million, (ii) adjustments for
non-cash and gain on sale items which increased cash flow by $6.0 million, and
(iii) a net decrease in operating assets and liabilities of $6.2 million,
compared to net cash provided by operations of $11.2 million for the three
months ended March 31, 2002, which included (i) net income of $13.3 million,
(ii) adjustments for non-cash items which decreased cash flow by $2.3 million,
and (iii) a net increase in operating assets and liabilities of $231,000.

Net cash used in investing activities of $187.3 million for the three
months ended March 31, 2003 included: (i) the acquisition of one parcel of land
for $1.7 million, (ii) construction, development and other capital improvements
of $7.0 million, (iii) the acquisition of IRT for $187.6 million, net of cash
received, offset by (iv) proceeds from the sale of two properties of $6.7
million, and (v) proceeds from payment of notes receivable of $2.8 million,
compared to net cash used in investing activities of $9.7 million for the three
months ended March 31, 2002 which included: (i) the purchase of two properties
and two parcels of land for $9.2 million, (ii) improvements to rental properties
and construction expenditures relating to development projects totaling $3.3
million, (iii) increase in cash held for property exchanges of $6.0 million,
offset by (iv) proceeds from the sale of three properties of $8.8 million.

Net cash provided by financing activities of $175.0 million for the three
months ended March 31, 2003 included: (i) net borrowings on the revolving credit
facilities of $138.0 million, (ii) net proceeds from the issuance of common
stock of $100.0 million, offset by (iii) the payoff of six mortgage notes for
$43.5 million and monthly principal payments on mortgage notes of $2.5 million,
(iv) cash dividends paid to common stockholders of $16.1 million, and (v) other
miscellaneous uses of $809,000, compared to net cash used by financing
activities of $884,000 for the three months ended March 31, 2002 which included:
(i) net proceeds from issuance of common stock of $56.5 million, offset by (ii)
the payoff of five mortgage notes for $27.2 million and monthly principal
payments on mortgage notes of $1.5 million, (iii) net repayments on the
revolving credit facility of $18.4 million, (iv) cash dividends paid to common
stockholders of $8.0 million, and (v) other miscellaneous uses of $536,000.

LIQUIDITY AND CAPITAL RESOURCES

The Company's principal demands for liquidity are maintenance expenditures,
repairs, property taxes and tenant improvements relating to rental properties,
leasing costs, 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 and debt securities, the placement of mortgage loans and
periodic borrowings under the Company's revolving credit facilities.

On February 7, 2003 we entered into a $340 million unsecured revolving
credit facility with a group of banks for which Wells Fargo Bank, National
Association is the sole lead arranger and administrative agent. This facility
bears interest at our option at (i) LIBOR plus 0.65% to 1.35%, depending on the
credit ratings of our senior unsecured long term indebtedness or (ii) at the
greater of (x) Wells Fargo's prime rate and (y) the Federal Funds Rate plus
0.5%. The facility also includes a competitive bid option which allows us to
conduct auctions among the participating banks for borrowings in an amount not
to exceed $150 million, a $25 million swing line facility for short term
borrowings and a $20 million letter of credit commitment. The facility expires
February 12, 2006 with a one year extension option. In addition, the facility
contains customary covenants, including financial covenants regarding debt
levels, total liabilities, interest coverage, EBITDA levels, unencumbered
properties, permitted investments and others. The facility also prohibits
stockholder distributions in excess of 95% of funds from operations calculated
at the end of each fiscal quarter for the four fiscal quarters then ending.
Notwithstanding this limitation, we can make stockholder 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 unless the default is a payment default or bankruptcy event in which
case we would be prohibited from paying any dividends. The facility is
guaranteed by substantially all of our wholly-owned subsidiaries. As of March
31, 2003, we had $169 million outstanding on this credit facility. The weighted
average interest rate at March 31, 2003 was $2.29%.

As a result of our merger with IRT, we assumed IRT's obligations relating
to $150 million principal amount of Senior Notes, bearing interest at fixed
annual interest rates ranging from 7.25% to 7.84% and maturing between 2006 and
2012. The interest rate on one of the Senior Notes is dependent on our senior
unsecured debt rating. These notes have also been guaranteed by substantially
all of our wholly-owned subsidiaries.

As of March 31, 2003, we had a $5 million unsecured credit facility with
City National Bank of Florida and no amounts outstanding on this credit
facility. This facility secures $1,183 in outstanding letters of credit.

Our revolving credit facility balances as of March 31, 2003 and December
31, 2002 consisted of the following:

March 31, December 31,
2003 2002
---------- ------------
(in thousands)

Revolving Credit Facilities
City National Bank ......................... $ -- $ --
Wells Fargo ................................ 169,000 23,000
-------- --------
Total revolving credit facilities ............... $169,000 $ 23,000
======== ========

As of March 31, 2003, the amount available under the various revolving
credit facilities is $125 million based on the most recent available
calculations.

Our mortgage notes payable balances as of March 31, 2003 and December 31,
2002 consisted of the following:

March 31, December 31,
2003 2002
------------ ------------
(in thousands)

Mortgage Notes Payable
Fixed rate mortgage loans................ $.422,311 $ 307,508
Variable rate mortgage loans............. - 24,635
Unamortized premium on notes payable..... 7,137 -
---------- ----------
Total mortgage notes payable.......... $ 429,448 $ 332,143
========== ==========

Each of the mortgage loans is secured by a mortgage on one or more of
certain of our properties. Some of the mortgage agreements contain monetary
penalties if the loan is repaid prior to maturity date. Certain of the mortgage
loans involving an aggregate principal balance of approximately $171 million,
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, 2003, our total debt of $741.3 million less our cash and
cash equivalents, cash held in escrow and securities available for sale, or
$724.8 million divided by our gross real estate assets of $1,450.7 million
equals 50.0%.

As of March 31, 2003, the balances due at the maturity of our various notes
payable (excluding unamortized premium) are as follows:

Principal Balance
-----------------
Year Due at Maturity

2003....................... $ 6,284
2004....................... 8,980
2005....................... 36,620
2006....................... 253,443
2007....................... 87,643
Thereafter................. 348,341
------------------
Total.................. $ 741,311
==================

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 have entered into a ground lease with a drug store and expect to
commence development in the first half of 2003 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 $3.6 million. Development of phase three of the Shops
of Skylake, totaling approximately 75,000 square feet is anticipated to be
completed in early 2004 at an estimated cost of approximately $5.5 million.
Development of 20,000 square feet of retail space on our four acre site at Port
St. Lucie, Florida, adjacent to our Cashmere Corners retail Center, at a cost of
$1.8 million is expected to be completed in late 2003. In addition, as of March
31, 2003, in order to complete the construction of other in progress development
projects, we have committed to fund construction costs of $6 million. These
obligations principally comprise of construction contracts and are generally due
as the work is performed. We expect to fund the costs of the development of
projects from cash generated from our operations, borrowings under our various
revolving credit facilities and other sources of cash.

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, 2003, our remaining availability under the universal
shelf registration totaled $204.3 million.

During the first quarter, we issued 224,122 shares of our common stock at a
price ranging from $12.76 to $14.70 per share pursuant to our Divided
Reinvestment and Stock Purchase Plan. As of March 31, 2003, our shares remaining
for sale under our Dividend Reinvestment and Stock Purchase Plan totaled 4.7
million.

We believe, based on currently proposed plans and assumptions relating to
our operations, that our existing financial arrangements, together with cash
generated from our 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 and other corporate purposes,
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 our 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 matters discussed in this Quarterly Report on Form 10-Q contain
"forward-looking statements" for purposes of Section 27A of the Securities Act
of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as
amended. These forward-looking statements are based on current expectations and
are not guarantees of future performance.

All statements other than statements of historical facts are
forward-looking statements, and can be identified by the use of forward-looking
terminology such as "may," "will," "might," "would," "expect," "anticipate,"
"estimate," "would," "could," "should," "believe," "intend," "project,"
"forecast," "target," "plan," or "continue" or the negative of these words or
other variations or comparable terminology, are subject to certain risks, trends
and uncertainties that could cause actual results to differ materially from
those projected. Because these statements are subject to risks and
uncertainties, actual results may differ materially from those expressed or
implied by the forward-looking statements. We caution you not to place undue
reliance on those statements, which speak only as of the date of this report.

Among the factors that could cause actual results to differ materially are:

o general economic conditions, competition and the supply of and demand
for shopping center properties in our markets;

o management's ability to successfully combine and integrate the
properties and operations of separate companies that we have acquired
in the past or may acquire in the future;

o interest rate levels and the availability of financing;

o potential environmental liability and other risks associated with the
ownership, development and acquisition of shopping center properties;

o risks that tenants will not take or remain in occupancy or pay rent;

o greater than anticipated construction or operating costs;

o inflationary and other general economic trends;

o the effects of hurricanes and other natural disasters; and

o other risks detailed from time to time in the reports filed by us with
the Securities and Exchange Commission.

Except for ongoing obligations to disclose material information as required
by the federal securities laws, we undertake no obligation to release publicly
any revisions to any forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.

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
6.98 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, 2003, the fair value of the fixed
rate mortgage loans was estimated to be $476.4 million compared to the carrying
value amount of $422.3 million, excluding unamortized premium on notes payable.
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 7.43%,
the fair market value would be $402.5 million and $446.1 million, respectively.

The Company estimates the fair market value of its senior unsecured fixed
rate debt using discounted cash flow analysis based on current borrowing rates
for similar types of debt. At March 31, 2003, the fair value of its senior
unsecured fixed rate debt was estimated to be $165.3 million compared to the
carrying value amount of $150 million, excluding unamortized premium on notes
payable. 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
7.55%, the fair market value would be $144.3 million and $155.9 million,
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 $1.7 million based on the Company's variable rate debt
balance on March 31, 2003 encompassing $169.0 million of revolving credit
facilities.

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. The Company has executed interest
rate swaps in the aggregate amount of $70 million for periods ranging from one
to three years.

ITEM 4. CONTROLS AND PROCEDURES

We have evaluated the design and operation of our disclosure controls and
procedures to determine whether they are effective in ensuring that the
disclosure of required information is timely made in accordance with the
Securities Exchange Act of 1934, or the Exchange Act, and the rules and forms of
the Securities and Exchange Commission. This evaluation was made under the
supervision and with the participation of management, including our Chief
Executive Officer and Chief Financial Officer, within the 90-day period prior to
the filing of this quarterly report. Our Chief Executive Officer and Chief
Financial Officer have concluded, based on their review, that our disclosure
controls and procedures, as defined at Exchange Act Rules 13a-14(c) and
15d-14(c), are effective to ensure that information required to be disclosed by
us in reports that we file under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in Securities and
Exchange Commission rules and forms. In addition, no significant changes were
made to our internal controls or in other factors that could significantly
affect these controls subsequent to the date of their evaluation.

Our management, including our Chief Executive Officer and Chief Financial
Officer, however, does not expect that our disclosure controls or our internal
controls will prevent all errors and fraud. A control system, no matter how well
operated, can provide only reasonable, not absolute, assurance that the
objectives of the control system are met. Further, the design of a control
system must reflect the fact that there are resource constraints, and the
benefits of controls must be considered relative to their costs. Because of the
inherent limitations in all control systems, no

evaluation of controls can provide absolute assurance that all control issues
and instances of fraud, if any, have been detected. The design of any system of
controls also is based in part upon assumptions about the likelihood of future
events, and there can be no assurance that any design will succeed in achieving
its stated goals under all potential future conditions. Moreover, controls may
become inadequate because of changes in conditions, or the degree of compliance
with the policies or procedures may deteriorate. Because of the inherent
limitations in a cost-effective control system, misstatements due to error or
fraud may occur and not be detected.

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 February 12, 2003, the Company completed a private placement of
6,911,000 shares of its common stock. Three affiliated investors, Alony Hetz
Properties & Investments, Ltd., Silver Maple (2001), Inc. and M.G.N. (USA) Inc.
purchased 1.6 million, 1.0 million, and 4.3 million shares of common stock,
respectively, at $13.50 per share. The net proceeds of $93 million in cash were
used to fund a portion of the cost of the acquisition of IRT.

The foregoing issuances were made pursuant to exemption 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

On February 12, 2003, the Company held a special meeting of stockholders.
At the special meeting, the stockholders were asked to:

o Approve the agreement and plan of merger with IRT and the merger of
IRT with and into the Company;

o Approve the issuance of $6,911,000 shares of common stock in
connection with a private placement to affiliated investors
concurrently with the closing of the IRT merger; and

o Elect Patrick L. Flinn as a Class A director of the Company board of
directors to hold office until the 2005 annual meeting of
stockholders.

With respect to the vote on the IRT merger agreement and merger, 29,975,445
votes were cast in favor of the proposal, 110,064 votes against the proposal and
33,141 votes were withheld. With respect to the vote on the private placement,
29,942,129 votes were cast in favor of the proposal, 140,194 votes against the
proposal and 36,327 votes were withheld. With respect to the election of Mr.
Flinn, 33,462,854 votes were cast in favor of his election, 119,058 votes
against his election and 66,157 votes were withheld. Based on these results,
each of the proposals was approved at the special meetings.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:

99.1 Certification pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

99.2 Certification pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

(b) Reports on Form 8-K:

During the quarterly period ended March 31, 2003, the Company filed the
following reports on Form 8-K:

(i) Report on Form 8-K dated January 15, 2003 under Item 5 and 7.

(ii) Report on Form 8-K dated January 23, 2003 under Item 5 and 7.

(iii) Report on Form 8-K dated January 30, 2003 under Item 5 and 7.

(iv) Report on Form 8-K dated February 12, 2003 under Item 7 and 9.

(v) Report on Form 8-K dated February 18, 2003 under Item 5 and 7.

(vi) Report on Form 8-K dated February 20, 2003 under Item 5 and 7.

(vii) Report on Form 8-K dated February 25, 2003 under Item 5 and 9.

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 13, 2003 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)

INDEX TO EXHIBITS

EXHIBIT NO. DESCRIPTION
----------- -----------

99.1 CERTIFICATE OF CHIEF EXECUTIVE OFFICER

99.2 CERTIFICATE OF CHIEF FINANCIAL OFFICER