|
|
|
|
|
|
|
|
|
|
|
|
|
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) : May 21, 1997
SIMON DeBARTOLO GROUP, INC.
(Exact name of registrant as specified in its charter)
Maryland 1-12618 35-1901999
(State or other jurisdiction(Commission (IRS Employer
of incorporation) File Number) Identification No.)
115 WEST WASHINGTON STREET
INDIANAPOLIS, INDIANA 46204
(Address of principal executive offices)(Zip Code)
Registrant's telephone number, including area code: 317.636.1600
Not Applicable
(Former name or former address, if changed since last report)
Page 1 of 33 Pages
<PAGE>
Item 5. Other Events
On May 21, 1997 the Registrant made available additional ownership and
operation information concerning the Registrant, Simon DeBartolo Group, L.P.,
Simon Property Group, L.P. and properties owned or managed as of March 31,
1997, in the form of a Supplemental Information package, a copy of which is
included as an exhibit to this filing. The Supplemental Information package is
available upon request as specified therein.
Item 7. Financial Statements and Exhibits
Financial Statements:
None
Exhibits:
Page Number in
Exhibit No. Description This Filing
- ----------- ----------- -----------
99 Supplemental Information 4
as of March 31, 1997
<PAGE> 2
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.
Dated: May 21, 1997
SIMON DeBARTOLO GROUP, INC.
By: /s/ James M. Barkley
-------------------------
James M. Barkley,
Secretary/General Counsel
<PAGE> 3
SIMON DeBARTOLO GROUP
SUPPLEMENTAL INFORMATION
Table of Contents
As of March 31, 1997
Information Page
Overview 5
Ownership Structure 6-7
Reconciliation of Net Income to Funds from Operations
("FFO") 8
Selected Financial Information 9-10
Portfolio GLA, Occupancy & Rent Data 11
Rent Information 12
Lease Expirations 13-14
Scheduled Debt Amortization and Maturities 15
Summary of Mortgage Indebtedness 16
Summary of Mortgage Indebtedness by Maturity 17-22
Summary of Variable Rate Debt and Interest Rate Protection
Agreements 23-24
New Development Activities 25
Renovation/Expansion Activities 26-27
Capital Expenditures 28
Gains on Sales of Peripheral Land 29
Teleconference Text - May 7, 1997 30-33
<PAGE> 4
SIMON DeBARTOLO GROUP
Overview
The Company
Simon DeBartolo Group, Inc. (the "Company" or "SDG") (NYSE:SPG) was created as
a result of the merger (the "Merger") on August 9, 1996, of DeBartolo Realty
Corporation ("DRC") into Simon Property Group, Inc.
Through its majority owned subsidiaries, Simon DeBartolo Group, L.P. and Simon
Property Group, L.P. (collectively, the "Operating Partnership"), the Company
owns or has an interest in 186 properties which consist of existing regional
malls, community shopping centers and specialty and mixed-use properties
containing an aggregate of 114 million square feet of gross leasable area in 33
states. The Company, together with its affiliated management companies,
manages approximately 130 million square feet of gross leasable area in retail
and mixed-use properties.
This package was prepared to provide (1) ownership information, (2) certain
operational information, and (3) debt information as of March 31, 1997, for
the Company and the Operating Partnerships.
Certain statements contained in this Supplemental Package may constitute
"forward-looking statements" made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Investors are cautioned that
forward-looking statements involve risks and uncertainties which may affect the
business and prospects of the Company and the Operating Partnership, including
the risks and uncertainties discussed in other periodic filings made by the
Company and the Operating Partnership with the Securities and Exchange
Commission.
We hope you find this Supplemental Package beneficial. Any questions, comments
or suggestions should be directed to: Shelly J. Doran, Director of Investor
Relations-Simon DeBartolo Group, P.O. Box 7033, Indianapolis, IN 46207 (317)
685-7330.
<PAGE> 5
SIMON DeBARTOLO GROUP
ECONOMIC OWNERSHIP STRUCTURE
As of March 31, 1997
SIMON DeBARTOLO GROUP, L.P. (the "Operating Partnership")
Total Common Shares and Units Outstanding = 158,504,460 (1)
Operational Assets:
-------------------
113 Regional Malls
65 Community Shopping Centers
3 Specialty Retail Centers
4 Mixed-Use Properties
1 Value-Oriented Super-Regional Mall
Partners: %
--------- --
Simon DeBartolo Group, Inc.
Public Shareholders 59.2%
Simon Family 2.1%
DeBartolo Family 0.0%
Executive Management 0.2%
-----
61.5%
-----
Limited Partners
Simon Family 21.9%
DeBartolo Family 14.0%
Other Limited Partners 2.5%
Executive Management 0.1%
-----
38.5%
-----
100.0%
Simon DeBartolo Group, Inc. (the "Company")(3)
61.5% General Partner of Operating Partnership
Common Shareholders Shares(2) %
------------------- --------- --
Public Shareholders 93,811,261 96.2%
Simon Family 3,329,821 3.4%
DeBartolo Family 19,832 0.0%
Executive Management 373,397 0.4%
---------- ------
97,534,311 100.0%
Limited Partners ("Limited Partners")
38.5% Limited Partners of Operating Partnership
Unitholders Units %
----------- ----- --
Simon Family 34,584,455 56.7%
DeBartolo Family 22,207,888 36.4%
Executive Management 153,498 0.3%
Other Limited Partners 4,028,209 6.6%
---------- ------
60,974,050 100.0%
(1) Schedule excludes preferred stock: 4 million shares of Series A issued on
10/27/95 and 8 million shares of Series B issued on 9/27/96.
(2) Comprised of 94,330,311 registered shares and 3,204,000 unregistered shares
- Simon Family 3,200,000 Class B common and DeBartolo Family 4,000 Class C
common.
(3) General partner of Simon DeBartolo Group, L.P. and Simon Property Group,
L.P.
<PAGE> 6
SIMON DeBARTOLO GROUP
Changes in Common Stock and Unit Ownership
For the Period from December 31, 1996 through March 31, 1997
Operating
Partnership Company
Units Common Shares
---------- ------------
Number Outstanding at December 31, 1996 60,974,050 96,880,415
March 26 Award of Restricted Stock (Stock
Incentive Program) - 507,549
Issuance of Stock to former DRC Employees in
connection with the Merger - 14,688
Issuance of Stock for Employee Stock Option
Exercises - 131,659
Number Outstanding at March 31, 1997 60,974,050 97,534,311
Total Common Shares and Units Outstanding at March 31, 1997:
158,508,361
<PAGE> 7
SIMON DeBARTOLO GROUP
Reconciliation of Net Income to Funds From
Operations ("FFO") (1)
As of March 31, 1997
(In thousands, except per share data)
Three
Months
Ended
March 31,
The Operating Partnership 1997 1996
-------- --------
Income of the Operating Partnership before
Extraordinary Items $43,062 $23,832
Plus: Depreciation and Amortization from
Consolidated Properties 43,312 24,537
Less: Minority Interest Portion of
Depreciation and Amortization (850) (690)
Plus: SDG's Share of Depreciation,
Amortization and Extraordinary Items from
Unconsolidated Affiliates 8,858 3,032
Less: Preferred Dividends (6,406) (2,031)
Less: Gain on the Sale of Real Estate (37) -
Funds from Operations of the Operating
Partnership $87,939 $48,680
Percent Increase 80.6%
Weighted Average Common Shares and Units
Outstanding 157,951 95,665
FFO per Share/Unit $0.56 $0.51
Percent Increase 9.8%
The Company
FFO Allocable to the Company $53,992 $29,727
Percent Increase 81.6%
Weighted Average Common Shares Outstanding 96,977 58,382
FFO per Share $0.56 $0.51
Percent Increase 9.8%
Distributions per Common Share/Unit $0.4925 (2) $0.4925
(1) FFO amounts were calculated in accordance with the National
Association of Real Estate Investment Trust's revised definition of
FFO. Please see detailed discussion of FFO in the Company's
December 31, 1996, Form 10-K.
(2) On May 6, 1997, the Company announced a quarterly dividend of
$0.5050 per share payable May 23, 1997 to shareholders of record on
May 16, 1997. This represents a 2.5% increase over the last
quarterly dividend of $0.4925.
<PAGE> 8
SIMON DeBARTOLO GROUP
Selected Financial Information
As of March 31, 1997
(In thousands, except as noted)
Three
Months
Ended
March
31,
%
1997 1996 Change
Financial Highlights(1)
Total Revenues - Consolidated Properties
$242,414 $139,444 73.8%
Total EBITDA of Portfolio Properties $205,341 $115,741 77.4%
EBITDA After Minority Interest $163,843 $91,216 79.6%
Net Income Available to Common
Shareholders Before Extraordinary
Items $22,484 $13,251 69.7%
Net Income Available to Common
Shareholders per Share Before
Extraordinary Items $0.23 $0.23 0.0%
Funds from Operations of the Operating
Partnership $87,939 $48,680 80.6%
Funds from Operations Allocable to the
Company $53,992 $29,727 81.6%
Funds from Operations per Common Share $0.56 $0.51 9.8%
Common Stock Distributions Declared, per
Common Share $0.4925 $0.4925 -
Operational Statistics(2)
Occupancy at End of Period:
Regional Malls (3) 84.3% 83.5% 0.8%
Community Shopping Centers (4) 91.7% 91.8% -0.1%
Average Base Rent per Square Foot:
Regional Malls (3) $20.84 $19.95 4.5%
Community Shopping Centers (4) $7.72 $7.37 4.7%
Total Tenant Sales Volume, in millions:
(5)
Regional Malls (6) $ 1,429 $ 1,377 3.8%
Community Shopping Centers (4) $ 311 $ 319 -2.5%
Number of Properties Open at End of
Period 186 122 52.5%
(1) Not adjusted to give effect to the Merger prior to August 9, 1996.
(2) Based upon the business and properties of Simon Property Group and
DRC on a combined basis to give effect to the Merger for all
periods reported.
(3) Includes mall and freestanding stores.
(4) Includes all Owned GLA.
(5) Represents only those tenants who report sales.
(6) Based upon the standard definition of sales for regional malls
adopted by the International Council of Shopping Centers which
includes only mall and freestanding stores.
<PAGE> 9
SIMON DeBARTOLO GROUP
Selected Financial Information
As of March 31, 1997
(In thousands, except as noted)
March 31, March 31,
Equity Information (1) 1997 1996
------------ ------------
Units Outstanding at End of Period 60,974 37,283
Common Shares Outstanding at End of
Period 97,534 58,560
------------ ------------
Total Common Shares and Units
Outstanding at End of Period 158,508 95,843
============ ============
Weighted Average Units Outstanding for
the Period 60,974 37,283
Weighted Average Common Shares
Outstanding for the Period 96,977 58,382
------------ ------------
Weighted Average Common Shares and
Units Outstanding for the Period 157,951 95,665
============ ============
March 31, December 31,
Selected Balance Sheet Information 1997 1996
------------ ------------
Total Assets $5,908,896 $5,895,910
Consolidated Debt $3,746,992 $3,681,984
Joint Venture Debt $1,175,010 $1,121,804
SDG Share of Joint Venture Debt $ 464,677 $ 448,218
Debt-to-Market Capitalization
Common Stock Price at End of Period $ 30.25 $ 31.00
Equity Market Capitalization (2) $5,094,760 $5,193,488
Total Capitalization - Consolidated
Debt Only $8,841,752 $8,875,472
Debt-to-Market Capitalization -
Consolidated Only 42.4% 41.5%
Total Capitalization - Including SDG
Share of JV Debt (millions) $9,306,429 $9,323,690
Debt-to-Market Capitalization -
Including SDG Share of JV Debt 45.3% 44.3%
(1) Not adjusted to give effect to the Merger prior to August 9, 1996.
(2) Market value of Common Stock and Units plus book value of Preferred Stock.
<PAGE> 10
SIMON DeBARTOLO GROUP
Portfolio GLA, Occupancy & Rent Data
As of March 31, 1997
Avg. Annual
% of Owned Base Rnt Per
Total % of GLA Which Lsd Sq. Ft.
Type of Property GLA-Sq. Ft. Owned GLA Owned GLA is Leased Owned GLA
Regional Malls
- -Anchor 59,676,818 19,624,393 29.1% 98.6% $3.20
- -Mall Store 32,387,193 32,387,193 48.0% 84.1% 21.22
- -Freestanding 1,649,775 820,956 1.2% 90.7% 7.14
Subtotal 34,036,968 33,208,149 49.2% 84.3% $20.84
Regional Mall Total 93,713,786 52,832,542 78.3% 89.6% $13.48
Community Shopping Centers
- -Anchor 10,914,406 6,692,740 9.9% 93.1% $6.26
- -Mall Store 3,597,791 3,516,701 5.2% 88.4% 10.69
- -Freestanding 787,223 292,584 0.4% 98.6% 7.34
Community Ctr. Total 15,299,420 10,502,025 15.5% 91.7% $7.72
Office Portion of
Mixed-Use Props 2,002,498 2,002,498 3.0% 94.3% $18.96
Mills-type Properties
and Other 2,722,322 2,189,537 3.2%
GRAND TOTAL 113,738,026 67,526,602 100.0%
Occupancy History
Community
As of Regional Malls(1) Shopping Centers(2)
3/31/97 84.3% 91.7%
3/31/96 83.5% 91.8%
12/31/96 84.7% 91.6%
12/31/95(3) 85.5% 93.6%
12/31/94(3) 85.6% 93.9%
12/31/93(3) 85.9% (4)
(1) Includes mall and freestanding stores.
(2) Includes all Owned GLA.
(3) On a pro forma combined basis giving effect to the Merger with DRC
for periods presented.
(4) Information not available as community shopping center statistics for
the properties formerly owned by DRC were not calculated prior to
1994.
<PAGE> 11
SIMON DeBARTOLO GROUP
Rent Information
As of March 31, 1997
Average Base Rent
Mall/Freestanding % Community %
As of Stores@Reg'l Malls Change Shopping Ctrs Change
3/31/97 $20.84 4.5% $7.72 4.7%
3/31/96 19.95 - 7.37 -
12/31/96 20.68 7.8 7.65 4.9
12/31/95(1) 19.18 4.4 7.29 2.4
12/31/94(1) 18.37 3.8 7.12 N/A
12/31/93(1) 17.70 5.0 N/A N/A
Rental Rates
Base Rent (2)
Store Opngs Store ClsngsAmount of Change
Year for Period for Period Dollar Percentage
Regional Malls:
1997 (YTD) $23.69 $20.34 $3.35 16.5%
1996 23.59 18.73 4.86 25.9
Community Shopping Centers:
1997 (YTD) $8.97 $8.95 $0.02 0.2%
1996 8.18 6.16 2.02 32.8
(1) On a pro forma combined basis giving effect to the Merger with DRC for
periods presented.
(2) Represents the average base rent in effect during the period for those
tenants who signed leases as compared to the average base rent in effect
during the period for those tenants whose leases terminated or expired.
<PAGE> 12
SIMON DeBARTOLO GROUP
Lease Expirations(1)
As of March 31, 1997
Average
Number of Square Base Rent per
Year Leases Expiring Feet Square Foot
at 3/31/97
Regional Malls - Mall & Freestanding Stores
97 4/1 12/31 535 1,053,594 20.81
1998 1,052 2,073,991 22.96
1999 1,049 2,336,169 21.50
2000 1,024 2,282,188 22.94
2001 948 2,398,352 20.58
2002 708 2,172,606 20.02
2003 709 1,982,872 22.55
2004 690 2,195,472 22.15
2005 649 2,253,820 20.32
2006 897 2,696,668 23.30
2007 445 1,330,979 23.82
TOTALS 8,706 22,776,711 $21.91
Regional Malls - Anchor Tenants
97 4/1-12/31 2 308,212 1.17
1998 11 1,805,155 1.45
1999 12 1,620,140 1.74
2000 11 1,748,754 1.95
2001 11 1,644,947 2.09
2002 7 761,206 1.92
2003 6 697,254 3.61
2004 13 1,130,439 4.37
2005 9 1,177,471 2.73
2006 11 1,284,004 3.69
2007 3 282,487 3.03
TOTALS 96 12,460,069 (1) $2.44
<PAGE> 13
Community Centers - Mall Stores & Freestanding Stores
97 4/1-12/31 52 138,408 9.27
1998 177 498,744 10.76
1999 167 496,667 11.10
2000 150 506,641 11.12
2001 113 388,302 10.98
2002 71 303,297 10.23
2003 23 140,390 11.14
2004 23 133,383 11.63
2005 27 174,708 10.19
2006 17 138,809 9.28
2007 7 85,177 8.43
TOTALS 827 3,004,526 $10.68
Community Centers - Anchor Tenants
97 4/1-12/31 2 52,373 6.45
1998 2 63,195 5.48
1999 8 238,681 4.83
2000 7 266,438 5.13
2001 10 442,483 3.62
2002 7 276,518 6.26
2003 9 298,498 6.34
2004 7 183,317 6.49
2005 11 630,445 5.61
2006 9 520,910 5.83
2007 6 429,481 5.70
TOTALS 78 3,402,339 $5.50
(1) Does not consider the impact of options that may be contained in leases.
<PAGE> 14
SIMON DeBARTOLO GROUP
Scheduled Debt Amortization and Maturities
As of March 31, 1997
(In thousands)
Scheduled Scheduled
Year Amortization Maturities Total
Consolidated
Properties
Mortgage
Indebtedness
1997 12,818 30,000 42,818
1998 18,421 348,880 367,301
1999 22,411 221,363 243,774
2000 24,763 383,529 408,292
2001 22,631 634,624 657,255
2002 19,334 407,334 426,668
2003 12,090 369,280 381,370
2004 8,259 160,280 168,539
2005 7,602 35,944 43,546
2006 7,253 48,048 55,301
Thereafter 9,512 245,257 254,769
$165,094 $2,884,539 $3,049,633
Corporate
Credit
Facility
1999 0 335,000 335,000
Unsecured Debt
2003 0 100,000 100,000
2006 0 250,000 250,000
Adjustment of
Indebtedness
to
Fair Mkt 12,359 0 12,359
Value, Net
Total
Consolidated
Debt $177,453 $3,569,539 $3,746,992
Joint Ventures
1997 1,915 12,463 14,378
1998 2,168 175,000 177,168
1999 2,357 124,736 127,093
2000 2,357 77,683 80,040
2001 4,651 69,502 74,153
2002 3,789 68,199 71,988
2003 2,778 172,444 175,222
2004 2,986 160,000 162,986
2005 263 160,471 160,734
2006 0 131,249 131,249
Thereafter 0 0 0
Total Joint
Venture Debt $23,264 $1,151,746 $1,175,010
<PAGE> 15
SIMON DeBARTOLO GROUP
Summary of Mortgage Indebtedness
As of March 31, 1997
(In thousands)
Principal SDG's
Balance Share of Weighted Average
3/31/97 Loan Balance Interest Rate
Consolidated Fixed 2,390,974 2,338,884 7.73%
Rate Debt
Unsecured Fixed 350,000 350,000 6.84%
Rate Debt
Adjustment of
Indebtedness
to Fair Market 12,694 12,694 N/A
Value &
Other, Net - Fixed
Rate Debt
Subtotal 2,753,668 2,701,578 7.58%
Consolidated
Variable 658,659 601,017 6.36%
Rate Debt
Corporate Credit
Facility 335,000 335,000 6.37%
Variable Rate Debt
Adjustment of
Indebtedness
to Fair Market
Value & Other,
Net - (335) (335) N/A
Variable Rate Debt
Subtotal 993,324 935,682 6.37%
Mortgage and Other
Notes Payable
Consolidated
Balance Sheets 3,746,992 3,637,260 7.27%
Joint Venture
Fixed Rate Debt 614,934 254,109 7.67%
Joint Venture
Variable Rate Debt 560,076 210,568 6.35%
Mortgage and Other
Notes Payable
Partnerships 1,175,010 464,677 7.07%
and Joint Ventures
<PAGE> 16
SIMON DeBARTOLO GROUP
Summary of Mortgage Indebtedness By Maturity
As of March 31, 1997
(In thousands)
<TABLE>
<CAPTION>
Principal SDG's Weighted Average
Property Maturity Interest Balance Share of Interest Rate
Name Date Rate 3/31/97 Loan Balance by Year
<S> <C> <C> <C> <C> <C>
Consolidated
Properties
Fixed
Rate Debt :
Subtotal 1997 0 0
White Oaks Mall 03/01/98 7.70% 16,500 9,062
Ross Park Mall 08/15/98 6.14% 60,000 60,000
Subtotal 1998 76,500 69,062 6.34%
West Ridge Mall 06/01/99 8.00% 47,920 47,920
Ingram Park Mall 11/01/99 9.63% 6,907 6,907
Ingram Park Mall 12/01/99 8.10% 49,060 49,060
Barton Creek Square 12/30/99 8.10% 63,429 63,429
La Plaza Mall 12/30/99 8.25% 50,399 50,399
Subtotal 1999 217,715 217,715 8.16%
Windsor Park Mall 06/01/00 8.00% 6,009 6,009
Trolley Square 07/23/00 5.81% 19,000 17,100
North East Mall 09/01/00 10.00% 22,384 22,384
Bloomingdale Court 12/01/00 8.75% 29,009 29,009
Forest Plaza 12/01/00 8.75% 16,904 16,904
Fox River Plaza 12/01/00 8.75% 12,654 12,654
Lake View Plaza 12/01/00 8.75% 22,169 22,169
Lincoln Crossing 12/01/00 8.75% 997 997
Matteson Plaza 12/01/00 8.75% 11,159 11,159
Regency Plaza 12/01/00 8.75% 1,878 1,878
St. Charles Towne Pl 12/01/00 8.75% 30,887 30,887
West Ridge Plaza 12/01/00 8.75% 4,612 4,612
White Oaks Plaza 12/01/00 8.75% 12,345 12,345
Subtotal 2000 190,007 188,107 8.61%
Biltmore Square 01/01/01 7.15% 28,070 28,070
Chesapeake Square 01/01/01 7.28% 50,358 50,358
Port Charlotte 01/01/01 7.28% 46,430 46,430
Great Lakes Mall 03/15/01 6.74% 53,960 53,960
Great Lakes Mall 03/15/01 7.07% 8,692 8,692
Securitized Debt Fin 03/01/01 8.12% 366,107 366,107
(1)
Subtotal 2001 553,617 553,617 7.77%
Columbia Shopping Ct 03/15/02 7.62% 43,247 43,247
Lima Mall 03/01/02 7.12% 19,352 19,352
Northgate Mall 03/15/02 7.62% 80,755 80,755
Tacoma Mall 03/15/02 7.62% 94,486 94,486
Crossroads Mall 07/31/02 7.75% 41,440 41,440
North Riverside Park 09/01/02 9.38% 4,097 4,097
North Riverside Park 09/01/02 10.00% 3,668 3,668
Hutchinson Mall 10/01/02 8.44% 11,523 11,523
Subtotal 2002 298,568 298,568 7.69%
Battlefield Mall 06/01/03 7.50% 50,484 50,484
South Park Mall 06/15/03 7.25% 24,748 24,748
Anderson Mall 12/15/03 6.74% 19,000 19,000
Forest Mall 12/15/03 6.74% 12,800 12,800
Forest Village Park 12/15/03 6.16% 20,600 20,600
Golden Ring Mall 12/15/03 6.74% 29,750 29,750
Longview Mall 12/15/03 6.16% 22,100 22,100
Markland Mall 12/15/03 6.74% 10,000 10,000
Midland Park Mall 12/15/03 6.31% 22,500 22,500
Miller Hill Mall 12/15/03 6.74% 34,500 34,500
Muncie Mall 12/15/03 6.99% 20,000 20,000
Muncie Mall 12/15/03 6.74% 24,000 24,000
North Towne Square 12/15/03 6.31% 23,500 23,500
Towne West Square 12/15/03 6.16% 40,250 40,250
Miami International 12/21/03 6.91% 47,380 28,428
Subtotal 2003 401,612 382,660 6.72%
Cielo Vista Mall 07/01/04 8.13% 2,323 2,323
College Mall 07/01/04 7.00% 43,298 43,298
Greenwood Park Mall 07/01/04 7.00% 36,264 36,264
Tippecanoe Mall 07/01/04 8.45% 47,398 47,398
Towne East Square 07/01/04 7.00% 57,245 57,245
Subtotal 2004 186,528 186,528 7.38%
Melbourne Square 02/01/05 7.42% 40,115 40,115
Subtotal 2005 40,115 40,115 7.42%
Treasure Coast Square 01/01/06 7.42% 54,414 54,414
Paddock Mall 10/01/06 8.25% 30,606 30,606
Gulf View Square 10/01/06 8.25% 38,482 38,482
Subtotal 2006 123,502 123,502 7.88%
Cielo Vista Mall 05/01/07 9.25% 56,633 56,633
McCain Mall 05/01/07 9.25% 26,240 26,240
Valle Vista Mall 05/01/07 9.25% 34,752 34,752
University Park Mall 10/01/07 7.43% 59,500 35,700
Subtotal 2007 177,125 153,325 8.83%
Subtotal 2008-2010 0 0
Randall Park 01/01/11 9.25% 33,975 33,975
Subtotal 2011 33,975 33,975 9.25%
Windsor Park Mall 05/01/12 8.00% 8,912 8,912
Subtotal 2012 8,912 8,912 8.00%
O'Hare International 12/31/13 7.50% 27,438 27,438
Subtotal 2013 27,438 27,438 7.50%
Subtotal 2014 0 0
Terrace @ Florida Mall 05/15/15 8.44% 4,688 4,688
Chesapeake Center 05/15/15 8.44% 6,563 6,563
Grove @ Lakeland Sq 05/15/15 8.44% 3,750 3,750
Subtotal 2015 15,001 15,001 8.44%
Subtotal 2016-2025 0 0
Sunland Park Mall 01/01/26 8.63% 40,359 40,359
Subtotal 2026 40,359 40,359 8.63%
Total Consolidated 2,390,974 2,338,884 7.73%
Fixed Rate Debt
Consolidated
Properties
Variable
Rate Debt :
Eastland Mall 11/01/97 6.94% 30,000 30,000
Subtotal 1997 30,000 30,000 6.94%
Lincolnwood Town Ctr 01/31/98 6.69% 63,000 63,000
East Towne Mall 09/29/98 6.56% 55,000 55,000
Eastgate Consumer 12/31/98 6.94% 22,929 22,929
Riverway 12/31/98 6.38% 85,571 85,571
Riverway 12/31/98 6.38% 45,879 45,879
Subtotal 1998 272,379 272,379 6.53%
Subtotal 1999 0 0
Jefferson Valley Mall 01/12/00 5.99% 50,000 50,000
(2)The Forum Shops 02/23/00 6.44% 90,500 54,300
(2)The Forum Shops 02/23/00 6.44% 9,500 5,225
(2)The Forum Shops 02/23/00 7.25% 36,340 19,987
Trolley Square 07/23/00 6.94% 4,641 4,177
Trolley Square 07/23/00 6.94% 3,500 3,150
Subtotal 2000 194,481 136,839 6.42%
Crystal River 01/01/01 6.75% 16,000 16,000
(1)Securitized Debt Fin 03/01/01 5.31% 87,200 87,200
Mainland Peripheral 12/31/01 6.75% 1,290 1,290
Subtotal 2001 104,490 104,490 5.55%
Highland Lakes Plaza 03/01/02 6.25% 14,377 14,377
Mall of the Mainland 03/31/02 6.75% 40,706 40,706
Mainland Crossing 03/31/02 6.25% 2,226 2,226
Subtotal 2002 57,309 57,309 5.04%
Total Consolidated 658,659 601,017 6.36%
Variable Rate Debt
Total Consolidated 3,049,633 2,939,901 7.45%
Properties
Joint Venture Properties
Fixed Rate Debt :
Aventura Mall 05/01/97 7.00% 2,500 833
Century III Mall 12/01/97 7.00% 376 188
Subtotal 1997 2,876 1,021 7.00%
Subtotal 1998-1999 0 0
Northfield Square 04/01/00 9.50% 25,190 25,190
Coral Square 12/01/00 7.40% 53,300 26,650
Subtotal 2000 78,490 51,840 8.42%
Subtotal 2001 0 0
Palm Beach Mall 12/15/02 8.21% 51,981 25,991
Subtotal 2002 51,981 25,991 8.21%
The Avenues 05/15/03 8.36% 58,878 14,719
Century III Mall 07/01/03 6.78% 66,000 33,000
Lakeland Square 12/22/03 7.26% 53,300 26,650
Subtotal 2003 178,178 74,369 7.26%
Subtotal 2004 0 0
Cobblestone Court 11/30/05 7.22% 6,180 2,163
Crystal Court 11/30/05 7.22% 3,570 1,250
Fairfax Court 11/30/05 7.22% 10,320 2,709
Gaitway Plaza 11/30/05 7.22% 7,350 1,715
Ridgewood Court 11/30/05 7.22% 7,980 2,793
Royal Eagle Plaza 11/30/05 7.22% 7,920 2,772
The Plaza at Buckland 11/30/05 7.22% 17,680 6,188
The Yards Plaza 11/30/05 7.22% 8,270 2,895
Village Park Plaza 11/30/05 7.22% 8,960 3,136
West Town Corners 11/30/05 7.22% 10,330 2,411
Westland Park Plaza 11/30/05 7.22% 4,950 1,155
Willow Knolls Court 11/30/05 7.22% 6,490 2,272
Seminole Towne Center 12/27/05 6.88% 70,500 31,725
Subtotal 2005 170,500 63,183 7.05%
Great Northeast Plaza 06/01/06 9.04% 17,909 8,955
Smith Haven Mall 06/01/06 7.86% 115,000 28,750
Subtotal 2006 132,909 37,705 8.14%
Subtotal 2007-2016 0 0
Total Joint Venture
Fixed Rate Debt 614,934 254,109 7.67%
Joint Venture
Properties Variable
Rate Debt:
Aventura Mall 03/01/97 9.25% 3,563 1,188
Aventura Mall 05/01/97 9.50% 6,700 2,233
Subtotal 1997 10,263 3,421 9.41%
Aventura Mall 08/08/98 5.65% 99,700 33,233
Florida Mall 12/01/98 5.50% 75,000 37,500
Subtotal 1998 174,700 70,733 5.57%
Stratosphere (3) 03/13/99 7.38% 15,755 7,877
Indian River Mall 03/29/99 6.98% 40,467 20,234
Ontario Mills (3) 05/07/99 7.02% 100,000 25,000
Lakeline Mall 05/16/99 5.75% 68,515 34,257
Subtotal 1999 224,737 87,368 6.55%
Subtotal 2000 0 0
The Source 07/16/01 7.19% 69,502 34,751
Subtotal 2001 69,502 34,751 7.19%
Arizona Mills 02/01/02 6.83% 20,875 5,493
Subtotal 2002 20,875 5,493
Subtotal 2003 0 0
Circle Centre 01/31/04 5.94% 60,000 8,802
Subtotal 2004 60,000 8,802 5.94%
Total Joint Venture 560,076 210,568 6.35%
Variable Rate Debt
Total Joint Venture 1,175,010 464,677 7.07%
Properties
Total Mortgage Debt 4,224,643 3,404,578 7.40%
Unsecured
Debt Fixed
Rate Debt :
SDG, LP (PATS) 11/15/03 6.75% 100,000 100,000
Subtotal 2003 100,000 100,000 6.75%
SDG, LP (Bonds) 11/15/06 6.88% 250,000 250,000
Subtotal 2006 250,000 250,000 6.88%
Total Unsecured Fixed 350,000 350,000 6.84%
Rate Debt
Corporate Credit
Facility Variable
Rate Debt :
SDG, LP 09/27/99 6.37% 335,000 335,000
Subtotal 1999 335,000 335,000 6.37%
Total 335,000 335,000 6.37%
Corporate Credit Variable
Rate Debt
</TABLE>
(1) Secured by 17 centers previously owned by DRC.
(2) These loans were retired May 1997.
(3) Two one-year options exist to extend maturity.
<PAGE> 17-22
<TABLE>
SIMON DeBARTOLO GROUP
Summary of Variable Rate Debt and Interest Rate Protection Agreements
As of March 31, 1997
(In thousands)
<CAPTION>
Principal SDG SDG Interest Terms of
Property Maturity Balance Ownership Share of Rate Terms of Interest Rate
Protection
Name Date 3/31/97 % Loan Balance 3/31/97 Variable Rate Agreement
- --------------------------- ----------- ----------- ----------- ------------ ----------- ------------------- -----------------
<S> <C> <C> <C> <C> <C> <S>
Consolidated Properties:
Eastland Mall 11/01/97 30,000 100.0% 30,000 6.94% LIBOR+1.50%
Lincolnwood Town Ctr 01/31/98 63,000 100.0% 63,000 6.69% LIBOR+1.25%
East Towne Mall 09/29/98 55,000 100.0% 55,000 6.56% LIBOR+1.125%
Eastgate Consumer 12/31/98 22,929 100.0% 22,929 6.94% LIBOR + 1.50% LIBOR capped at 5.0%
through maturity
Riverway 12/31/98 85,571 100.0% 85,571 6.38% LIBOR + 1.375% LIBOR capped at 5.0%
through maturity
Riverway 12/31/98 45,879 100.0% 45,879 6.38% LIBOR + 1.375% LIBOR capped at 5.0%
through maturity
Jefferson Valley Mall 01/12/00 50,000 100.0% 50,000 5.99% LIBOR + .55%
LIBOR capped at 8.7%
through maturity
The Forum Shops 02/23/00 100,000 59.5% 59,525 6.44% LIBOR+1.00%
The Forum Shops 02/23/00 36,340 55.0% 19,987 7.25% LIBOR + 1.8125
Trolley Square 07/23/00 4,641 90.0% 4,177 6.94% LIBOR+1.50%
Trolley Square 07/23/00 3,500 90.0% 3,150 6.94% LIBOR+1.50%
Crystal River 01/01/01 16,000 100.0% 16,000 6.75% LIBOR + 2.00% See Footnote 2
Securitized Debt Fin 03/01/01 87,200 100.0% 87,200 5.31% LIBOR + .56% See Footnote 2
Mainland Peripheral 12/31/01 1,290 100.0% 1,290 6.75% LIBOR + 2.00% See Footnote 2
Mall of the Mainland 03/31/02 40,706 100.0% 40,706 6.75% LIBOR + 2.00% See Footnote 2
Highland Lakes Plaza 03/31/02 14,377 100.0% 14,377 6.25% LIBOR + 1.50% See Footnote 2
Mainland Crossing 03/31/02 2,226 100.0% 2,226 6.25% LIBOR + 1.50% See Footnote 2
----------- ------------
Total Consolidated Properties 658,659 601,017
=========== ============
Corporate Credit Facility:
SPG, LP 09/27/99 335,000 335,000 6.37% LIBOR + .90% (3) On March 13, 1996, the
Operating Partnership
entered into a two-
year
cap agreement in the
amount of $100
million.
The Operating
Partnership may elect
to use this cap on any
wholly owned variable-
interest debt.
LIBOR is initially
capped at 7.5%
through maturity,
however, if LIBOR
should equal or exceed
8.75% between monthly
reset dates, then
LIBOR would be capped
at 8.5% for
that period only.
Adjustment of Debt to Fair
Market Value (335) (335)
----------- ------------
Total Consolidated Variable-
Rate Debt $ 993,324 $ 935,682
=========== ===========
<PAGE> 23
Joint Venture Properties:
Aventura Mall 03/01/97 3,563 33.3% 1,188 9.25% Prime Rate (1)
Aventura Mall 05/01/97 6,700 33.3% 2,233 9.50% Prime + 1.25%
Aventura Mall 08/08/98 99,700 33.3% 33,233 5.65% Bank of Tokyo CD rate +.90%
See Footnote 2
Florida Mall 12/01/98 75,000 50.0% 37,500 5.50% 30-day Commercial paper rate
+ 0.75% See Footnote 2
Stratosphere 3/13/99 (4) 15,755 50.0% 7,877 7.38% LIBOR+2.00% (1)
Indian River Mall 03/29/99 40,467 50.0% 20,234 6.98% LIBOR+1.25%
Ontario Mills 05/07/99 (4) 100,000 25.0% 25,000 7.02% LIBOR +2.75% (1) LIBOR is swapped
at 6.37% on the first $50,000 only.
Lakeline Mall 05/16/99 68,515 50.0% 34,257 5.75% LIBOR+.375%
The Source 07/16/01 69,502 50.0% 34,751 7.19% LIBOR + 1.7%
Arizona Mills 02/01/02 20,875 26.3% 5,493 6.83% LIBOR + 1.3% LIBOR is capped at 9.5%.
Circle Centre 01/31/04 60,000 14.7% 8,802 5.94% LIBOR + .44% LIBOR is capped at 8.81%.
----------- ------------
Total Joint Venture 560,077 210,568
Properties =========== ============
Total Variable Mortgage and
Other Indebtedness 1,553,400 1,146,250
=========== ============
</TABLE>
Footnotes:
(1) Rate can be reduced based upon project performance.
(2) There exists a swap with the following terms: LIBOR fixed at 4.75% on
approximately $217.2 million of debt through April 1997; LIBOR fixed at
5.71% on $87.2 million of debt from May 1997 through April 2001.
These swaps have a maximum protection on LIBOR of 8.44%. To obtain the
swap, the Company "assigned" existing interest rate caps (all expiring in
April 1997) to an unrelated third party. An interest rate cap was also
purchased which limits LIBOR to 8.44% on $87.2 million of debt from
May 1996 through March 2001 in order to provide protection in the
event LIBOR exceeds 8.44%.
(3) On April 14, 1997, the interest rate was reduced to LIBOR plus 75 basis
points.
(4) Two one-year options exist to extend maturity.
(5) The following table summarizes variable rate debt as follows:
Total SDG Share
------------ -----------
Swapped debt 267,247 229,747
Capped debt "in the money"
154,379 154,379
Other hedged variable rate debt 230,875 164,295
Unhedged variable rate debt 900,899 597,829
------------ -----------
$ 1,553,400 $ 1,146,250
============ ===========
<PAGE> 24
<TABLE>
SIMON DeBARTOLO GROUP
New Development Activities
As of March 31, 1997
<CAPTION>
Non-Anchor
SDG Actual/ Projected Sq. Footage
Mall/ Ownership Projected Cost Leased/ GLA
Location Percentage Opening (in Committed (sq. ft.)
millions) (1)
<S> <C> <C> <C> <C> <C>
Projects Under Construction
The Source ValuPlexa 50% 9/97 $153 91% 730,000
Long Island, NY
Anchors/Major Tenants: Fortunoff, Nordstrom Rack, Off 5th-Saks
Fifth Avenue Outlet, Cheesecake
Factory, Rainforest Cafe, Just for
Feet, Bertolini's, Loehmann's, Old
Navy,
Virgin Megastore, Circuit
City, Brooklyn Diner
Arizona Mills 26% 11/97 $188 77% 1,230,000
Tempe, Arizona (as of
5/20/97)
Anchors/Major Tenants: Oshmans Supersport, Off 5th-Saks
Fifth Avenue Outlet, Burlington Coat
Factory, Harkins Theater, Rainforest
Cafe, GameWorks, Hi Health,
JCPenney
Outlet,
Group USA
Grapevine Mills 38% 10/97 $203 70% 1,480,000
Grapevine, TX (as of
5/15/97)
(Dallas/Ft. Worth)
Anchors/Major Tenants: Books-A-Million, Burlington Coat
Factory, Off 5th-Saks Fifth Avenue
Outlet,
Group USA, Rainforest Cafe, Bed Bath
& Beyond, AMC Theatres,
GameWorks, American
Wilderness, Sports Authority
Muncie Plaza 100% Spring 1998 $14 74% (2) 195,500
Muncie, IN
Anchors/Major Tenants: Kohl's, TJMaxx,
OfficeMax, Shoe
Carnival
Shops at Sunset Place 75% 9/98 $143 81% 500,000
South Miami, FL
Anchors/Major Tenants: AMC 24 Theatre, NIKETOWN, Barnes &
Noble, IMAX Theatre, Virgin
Megastore, Z Gallerie, Twin Palms,
GameWorks
Projects Under Development
Lakeline Plaza 50% 4/98 $39 (3) 391,000
Austin, TX
Anchors/Major Tenants: OfficeMax, Toys "R" Us, Linens 'N
Things, TJ Maxx, Old Navy, Party City
(1) As of April 25, 1997.
(2) Community Center leased/committed percentage includes owned anchor GLA.
(3) Leasing still in preliminary stage.
</TABLE>
<PAGE> 25
<TABLE>
SIMON DeBARTOLO GROUP
Renovation/ Expansion Activities
As of March 31, 1997
<CAPTION>
Total
SDG Projected Existing
Mall/ Ownership Anticipated Cost Year GLA
Location Percentage Completion (in millions) Built (sq. ft.)
<S> <C> <C> <C> <C> <C>
Projects Under Construction
The Forum Shops at Caesars 55% 8/97 $89 1992 242,000
Las Vegas, NV
(Expansion)
Scope of Construction: Addition of 235,000 sq. ft.
(including mezzanine), 97% leased and
committed; tenants include Virgin
Records, FAO Schwarz, Cheesecake
Factory and
NIKETOWN
Aventura Mall 33.3% 12/97 $91 1983 987,000
Miami, FL
(Expansion)
Scope of Construction: Additions of 252,000 sq. ft.
Bloomingdale's, 255,000 sq. ft. of
small shops,
77,948 sq. ft. AMC Theatre with 24
screens, new parking deck, Sears
37,000 sq. ft. expansion, Lord and
Taylor 28,000 sq. ft. expansion,
JCPenney 60,000 sq. ft. expansion,
and Macy's 45,000 sq. ft. expansion
The Florida Mall 50% Winter 1998 $79 1986 1,120,000
Orlando, FL
(Expansion)
Scope of Construction: Addition of 200,000 sq. ft. Burdines
and 180,000 sq. ft. of shops with
expansions to Sears, JCPenney,
Dillard's, and Gayfers
Projects Under Development
North East Mall 100% 1999 $150 1971 1,142,000
Hurst, TX
(Renovation/Expansion)
Scope of Construction: Additions of second level consisting
of 185,000 sq. ft. of small shops,
160,000 sq. ft. Nordstrom and one
additional department store,
expansions of Dillard's and JCPenney,
renovations of Sears and
Montgomery
Ward
Mission Viejo Mall 100% 1999 $100 1979 817,000
Mission Viejo, CA
(Renovation/Expansion)
Scope of Construction: Additions of 180,000 sq. ft.
Nordstrom, 130,000 sq. ft. of small
shops,
renovation with new food court,
Macy's 60,000 sq. ft. expansion
</TABLE>
<PAGE> 26
SIMON DeBARTOLO GROUP
Other Renovation/Expansion Activities
Projects Under Construction as of March 31, 1997
Anticipated
Name/Location Completion Scope of Construction
- ------------- ---------- --------------------------------
Lafayette Square 7/97 Remodel with new food court; new Waccamaw;
Indianapolis, IN L.S. Ayres expansion
Orange Park Mall 8/97 24 screen theatre addition
Jacksonville, FL
Tippecanoe Plaza 8/97 New Service Merchandise and Barnes & Noble
Lafayette, IN
Alton Square 10/97 New Sears; renovation
Alton, IL
Chautauqua Mall 11/97 Remodel/new foodcourt; Woolworth recapture;
Jamestown, NY new JCPenney and Bon-Ton
Knoxville Center 11/97 Renovation of "O" section and expansion of (East
Towne Mall) existing cinema
Knoxville, TN
Northgate Mall 11/97 Renovation with new food court
Seattle, WA
Richmond Square 11/97 New Dillard's and OfficeMax; food cluster
Richmond, IN and renovation
Southern Park Mall11/97 Remodel with new food court; GLA expansion;
Youngstown, new cinema
West Town Mall 3/98 New cinema; new parking deck
Knoxville, TN
(1) Total anticipated cost of the above projects is $122 million; SDG's share
is $116 million.
<PAGE> 27
SIMON DeBARTOLO GROUP
Capital Expenditures
For the Three Months Ended March 31, 1997
(In millions)
Joint Venture Properties
Consolidated SDG's
Properties Total Share
New Developments $20.7 $90.2 $35.4
Renovations and Expansions 23.2 1.2 0.6
Tenant Allowances-Retail 7.2 0.4 0.1
Tenant Allowances-Office .4 - -
Capital Expenditures
Recovered from Tenants .3 - -
Other (1) .7 .1 -
Totals $52.5 $91.9 $36.1
(1) Primarily represents capital expenditures not recovered from tenants.
<PAGE> 28
SIMON DeBARTOLO GROUP
Gains on Sales of Peripheral Land
As of March 31, 1997
(In millions)
Three Months Ended
March 31,
1997 1996(1)
Consolidated Properties - $0.3
SDG's Share of Joint Venture Properties $0.2 0.8
Totals $0.2 $1.1
(1) Not adjusted to give effect to the Merger prior to August 9, 1996.
<PAGE> 29
SIMON DeBARTOLO GROUP
Teleconference Text
May 7, 1997
David Simon
Today's call will provide an overview of financial and operational results, an
update on project openings, a status update on our very active development
pipeline, and an overview of our financing activities.
First of all, we are pleased with our financial results for the first quarter.
The Company's share of FFO for the quarter was $54 million, an increase of
81.8% over 1996. The increase on a per share basis was 9.8%, to $0.56 per
share from $0.51 in 1996.
Operational statistics are reported on a combined basis for the Simon and
DeBartolo portfolios for both reported periods. Mall occupancy at March 31 was
84.3, up .8% from a year ago. Major factors influencing this occupancy
increase include our continued aggressive leasing efforts, particularly as we
gain more knowledge of the DeBartolo properties, and a relative lack of
bankruptcies during the first quarter of 1997. The amount of square footage
lost to bankruptcies was significantly lower than during the first quarter of
1996.
Our expectations for 1997 include a continued high level of productivity in
leasing. We anticipate benefits in several properties from our significant
redevelopment activities. Leasing activity is on track for 1997 to achieve
budgeted levels if the number of tenant bankruptcies and restructurings remain
modest. At year-end 1997 we anticipate occupancy being above 1996 levels.
From a macro point of view, we believe that the retail outlook is more stable
than it has been the last couple of years.
Our average base rent in the regional malls was $20.84, up 4.5% from $19.95 one
year ago. The initial base rent of new leases signed during the quarter was
$23.69, an increase of $3.35 or 16.5%, over tenants who closed or whose leases
expired. Given the fact that this is the least active quarter of the year and
that we executed three leases on unusually large spaces that negatively skewed
the new leases signed number, we expect this statistic to return to traditional
levels by year-end.
We're very pleased with the sales volume in our regional malls. We were up
3.8%, from $1.377 billion to 1.429 billion in the first quarter. On a per
square foot basis, we experienced a 4% comparable store increase. We continue
to see above-industry sales growth, consistent with our 1996 year-end trend.
We believe that this is a function of our redevelopment efforts and our
aggressive leasing focus on better performing and more productive small shop
tenants. Renovation and expansion projects completed in 1996 are experiencing
double digit sales growth including: Bay Park Square, Bergen Mall, Chautauqua
Mall, Summit Mall and Lafayette Square.
We are generally pleased with the results of the quarter which were in line
with our budget for 1997, and we remain on target to reach 1997 expectations.
I will briefly discuss our project openings, then I'll turn the discussion over
to Rick to review our very active redevelopment program. Indian River Commons,
a 265,000 square foot community center constructed adjacent to our Indian River
Mall, opened during the first quarter. The mall is performing well and the
opening of our community center will enhance this retail complex, located in a
rapidly-growing area. In March we also opened a 24-screen AMC theater and a
Friday's restaurant, both of which opened very well and have increased mall
traffic.
We also opened a United Artist theater and entertainment complex in
Albuquerque, New Mexico at Cottonwood Mall, which is now 94%
leased/committed and performing very well. At Ontario Mills, we continue to
open the entertainment components. Dave and Buster's is now open while
American Wilderness, IWERKS and GameWorks will all open within 60 days. This
project has more than met our expectations.
Now I will turn the discussion over to Rick Sokolov.
Rick Sokolov
I will now provide an update on the new developments we have under
construction. Four new projects are continuing as scheduled. The Source,
which is our 730,000 square foot specialty center scheduled to open on
September 5 in Long Island, features Off 5th- Saks 5th Avenue, Nordstrom Rack
and Cheesecake Factory. Our two Mills projects, Grapevine Mills and Arizona
Mills, will be opening in the fourth quarter in Dallas and Tempe, respectively.
In 1998, we will open The Shops at Sunset Place, a 500,000 square foot
specialty center in South Miami, Florida.
We are considering the development of a value-oriented project in Charlotte,
North Carolina. This is a site where we had previously contemplated the
development of a regional mall, but are now focused on the possibility that it
may be better suited as a value-oriented project. We are also evaluating our
potential role in a Mills project in the Chicago area.
We continue our work on two power centers that are being developed adjacent to
our existing regional malls in Austin, Texas and Muncie, Indiana. We have
started site work at Muncie and are on schedule to begin construction at
Lakeline Plaza in Austin within the next 90 days. These projects are scheduled
for opening in 1998. Predevelopment activities are continuing on our power
center in the Dallas/Fort Worth area, adjacent to North East Mall, the subject
of a major redevelopment project in its own right.
As David said, we continue to be very heartened by the fact that our expansions
and renovations are providing the kind of financial returns and operational
results that show that we are on the right track in devoting capital to our
properties. We have provided a significant amount of detail on our program in
our 1996 10-K and 8-K. At this time, I want to give you an update on
activities that have taken place since our last 8-K and our fourth quarter
press release.
We are now under construction at The Florida Mall, where we are expanding
Dillards, Sears, JCPenney and Gayfers. These expansions will open in 1998. We
are adding a 180,000 square foot Burdines, and approximately 180,000 square
feet of small shops that will be opening in 1998 and the first quarter of 1999.
We have commenced construction on the expansion and renovation of Prien Lake
Mall in Lake Charles, LA. We are adding a Dillard's and Sears, renovating the
mall and JCPenney, and adding small shops and a food court. Scheduled opening
is November of 1998. At Forest Mall in Fond Du Lac, Wisconsin, we are adding
Sears in August of this year.
During the first quarter, we opened Kohl's at St. Charles Towne Center and
JCPenney at Smith Haven Mall. We opened JCPenney in Chautauqua Mall and will
have the renovation and food court open later this year with Bon Ton scheduled
to open in the first quarter of 1998.
The Summit Mall renovation has been completed. An additional element, a 60,000
square foot Dillards Home Store, will open in the third quarter of this year.
The Aventura Mall expansion is proceeding, and we are virtually fully leased in
that expansion space. Bloomingdales will open at Aventura in November.
We announced in April that Dillard Department stores has assumed operations at
five stores previously operated by Mervyns at the following regional malls:
Boynton Beach, Coral Square, Lakeland, Melbourne, and Miami International.
Dillard's has also acquired two Proffitt's stores that closed during the last
quarter in our properties at Virginia Center and Chesapeake Square. The
addition of Dillard's will certainly broaden their appeal and will trigger
additional expansion and redevelopment activity at Boynton Beach, Melbourne,
Miami International and Chesapeake.
We are continuing on the addition of 235,000 square feet of small shop space in
the Forum Shops at Caesars, which will open in late August. We plan to conduct
our second analyst and investor conference in conjunction with the grand
opening on August 27 and 28. We will be sending additional information in the
near future.
David Simon
I think that you can see from our development and redevelopment pipeline that
we continue to be the leading and most active developer and redeveloper of
retail properties in the country. We also continue to be on the forefront of
financing activities. An example of this is the amendment of our existing
credit facility. The two positive results of this restructuring were improved
pricing from LIBOR + 90 to LIBOR + 75 and an increase in the competitive bid
option from $150 to $300 million. Recent pricing on the bid option has been in
the range of LIBOR plus 62 basis points, which I believe is the tightest
pricing in the industry.
During the first quarter, we acquired the participation in cash flow feature on
mortgage loans for four of the portfolio properties. Under each of these
loans, the lender received 50% of the cash flow above a defined base amount.
This participation feature was acquired at a blended cap rate of 11%. In
conjunction with this transaction, the loan for one of the properties was
retired. Under GAAP, an extraordinary charge of $23 million was recorded to
book this transaction.
Within the next thirty days we expect to close on a $180 million, 7-year CMBS
on the Forum Shops, which will replace the current construction financing.
This transaction is expected to be priced at industry-tight levels. In
addition, our $300 million medium term note program should be in place next
week.
On the acquisition and disposition front, we disposed of a small neighborhood
center in Bristol, Tennessee. While not material to the financial statements,
this disposition is consistent with our strategy to sell non-core portfolio
assets.
On the acquisition front we expect, within the next few weeks, to announce $200
million of acquisitions of high quality real estate, to be acquired on an
accretive basis. The industry continues to consolidate. We'll be an active
player.
Finally, on the property management front, we have a long-standing relationship
with CGR (the US property manager and advisor for Rodamco NV). They are also
our joint venture partner in two portfolio properties. Effective on April 1st,
we acquired the management and leasing responsibilities on a fee-basis for:
Countryside Mall in Tampa, FL and Maplewood Square in Minneapolis, MN. Our
philosophy is to pickup third party management where there is a relationship
enhancement opportunity, but not to make it a core business. Our focus is to
improve on our portfolio properties which will increase the cash flow from our
business. In addition, we are only interested in providing third party
management for quality properties.
Things are progressing as expected in terms of the merger. For all intents and
purposes, the integration is completed, and I believe that the organization has
a clear focus going forward.
<PAGE> 30-33
|
|