|
|
|
|
|
|
|
|
|
|
|
|
|
|
Previous: UNIPHASE CORP /CA/, 8-K/A, 1998-08-24 |
Next: TAX EXEMPT SECURITIES TRUST SERIES 383, 24F-2NT, 1998-08-24 |
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) : August 24, 1998
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 38 Pages
<PAGE>
Item 5. Other Events
On August 24, 1998 the Registrant made available additional
ownership and operation information concerning the Registrant, Simon
DeBartolo Group, L.P., and properties owned or managed as of June 30,
1998, 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 June 30, 1998
<PAGE>
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: August 24, 1998
SIMON DeBARTOLO GROUP, INC.
By: \s\ Stephen E. Sterrett
-------------------
Stephen E. Sterrett,
Treasurer
<PAGE>
SIMON DeBARTOLO GROUP
SUPPLEMENTAL INFORMATION
Table of Contents
As of June 30, 1998
Information Page
Overview 5
Ownership Structure 6-8
Reconciliation of Income to Funds from Operations ("FFO") 9
Selected Financial Information 10-11
Portfolio GLA, Occupancy & Rent Data 12
Rent Information 13
Lease Expirations 14-15
Total Debt Amortization and Maturities by Year 16
Summary of Indebtedness 17
Summary of Indebtedness by Maturity 18-23
Summary of Variable Rate Debt and Interest Rate
Protection Agreements 24-25
New Development Activities 26
Renovation/Expansion Activities 27-29
Capital Expenditures 30
Gains on Sales of Peripheral Land 31
Teleconference Text - August 11, 1998 32-38
<PAGE>
SIMON DeBARTOLO GROUP
Overview
The Company
Simon DeBartolo Group, Inc. (the "Company" or "Simon") (NYSE:SPG) is a
self-administered and self-managed real estate investment trust
("REIT"). Simon DeBartolo Group, L.P. (the "Operating Partnership") is
a subsidiary partnership of the Company. The Company, through the
Operating Partnership, is engaged primarily in the ownership, operation,
management, leasing, acquisition, expansion and development of real
estate properties, primarily regional malls and community shopping
centers.
At June 30, 1998, the Company, through the Operating Partnership, owned
or had an interest in 216 properties which consisted of regional malls,
community shopping centers, and specialty and mixed-use properties
containing an aggregate of 139 million square feet of gross leasable
area (GLA) in 34 states. The Company, together with its affiliated
management companies, owned or managed approximately 154 million square
feet of GLA in retail and mixed-use properties.
In February, Simon and Corporate Property Investors ("CPI"), a privately-
held REIT, announced a plan to merge the two companies. The merger is
expected to be completed in September and is subject to shareholder
approval and customary regulatory and other conditions. The Company has
also announced the intent to change its corporate name to Simon Property
Group, Inc., effective upon completion of the merger.
This package was prepared to provide (1) ownership information, (2)
certain operational information, and (3) debt information as of June
30, 1998, for the Company and the Operating Partnership.
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>
SIMON DeBARTOLO GROUP
ECONOMIC OWNERSHIP STRUCTURE(1)
June 30, 1998
SIMON DeBARTOLO GROUP, L.P.
(the "Operating Partnership")
Total Common Shares and Units Outstanding = 177,860,815
Operational Assets:
-------------------
131 Regional Malls
75 Community Shopping Centers
7 Specialty and Mixed-Use Properties
3 Value-Oriented Super-Regional Malls
Partners: %
--------- --
Simon DeBartolo Group, Inc.
Public Shareholders 61.8%
Simon Family 1.9%
DeBartolo Family 0.0%
Executive Management 0.2%
-----
63.9%
-----
Limited Partners
Simon Family 19.4%
DeBartolo Family 12.5%
Other Limited Partners 4.1%
Executive Management 0.1%
-----
36.1%
-----
100.0%
Simon DeBartolo Group, Inc. (the "Company")(2)
63.9% General Partner of Operating Partnership
Common Shareholders Shares %
------------------- --------- --
Public Shareholders 109,977,391 96.7%
Simon Family 3,318,421 3.0%
DeBartolo Family 31,623 0.0%
Executive Management 350,699 0.3%
---------- ------
113,678,134 100.0%
Limited Partners ("Limited Partners")
36.1% Limited Partners of Operating Partnership
Unitholders Units %
----------- ----- --
Simon Family 34,584,455 53.9%
DeBartolo Family 22,222,599 34.6%
Executive Management 153,498 0.2%
Other Limited Partners 7,222,129 11.3%
---------- ------
64,182,681 100.0%
(1) Schedule excludes preferred stock: 8 million shares of Series B
issued on 9/27/96 and 3 million shares of Series C issued on 7/9/97.
(2) General partner of Simon DeBartolo Group, L.P.
<PAGE>
SIMON DeBARTOLO GROUP
Changes in Common Stock and Unit Ownership
For the Period from December 31, 1997 through June 30, 1998
Operating
Partnership Company
Units(1) Common Shares
------ -------------
Number Outstanding at December 31, 1997 61,850,762 109,643,001
Restricted Stock Awards (Stock Incentive
Program), Net - 487,498
Issuance of Stock and Units in Connection
with Acquisitions of Cordova Mall,
Lakeline Mall, The Westchester, and
Rolling Oaks Mall 2,336,699 519,889
Conversion of units into cash (1,880) -
Conversion of units into stock (2,900) 2,900
Shares Placed in Unit Investment Trusts - 2,957,335
Issuance of Stock in connection with
the DeBartolo Merger - 32,062
Issuance of Stock for Employee and
Director Stock Option Exercises - 35,449
Number Outstanding at June 30, 1998(2) 64,182,681 113,678,134
Total Common Shares and Units Outstanding
at June 30, 1998: 177,860,815(2)
(1) Excludes units owned by the Company (shown here as Company
Common Shares).
(2) Excludes preferred units relating to preferred stock
outstanding (see Schedule of Preferred Stock).
<PAGE>
SIMON DeBARTOLO GROUP
Preferred Stock Outstanding
($ in 000's)
Number of
$ Shares
- ------
Outstanding as of June 30, 1998
- -------------------------------
Series B Cumulative Redeemable Preferred
- public offering completed
on September 27, 1996(1) $200,000 8,000,000
Series C Cumulative Redeemable Preferred
- public offering completed
on July 9, 1997(2) $150,000 3,000,000
-------- ---------
$350,000 11,000,000
======== =========
(1) Dividends are paid at 8.75% per annum. The Company may redeem the
stock on or after September 29, 2006. The shares are not convertible
into any other securities of the Company. Simon DeBartolo Group, Inc.
contributed the proceeds to the Operating Partnership in exchange for
preferred Units. The Operating Partnership pays a preferred
distribution to the Company equal to the dividends paid on the preferred
stock. The shares are traded on the New York Stock Exchange. The
closing price on June 30, 1998, was $25.875 per share, or $207,000 in
the aggregate.
(2) The Cumulative Step-Up Premium Rate Preferred Stock was issued at
7.89%. The shares are redeemable after September 30, 2007. Beginning
October 1, 2012, the rate increases to 9.89%. The shares are not
convertible into any other securities of the Company. The Company
contributed the proceeds of the offering to the Operating Partnership in
exchange for preferred units, the economic terms of which are
substantially identical to the Series C preferred stock.
<PAGE>
SIMON DeBARTOLO GROUP
Reconciliation of Income to Funds From Operations ("FFO")
As of June 30, 1998
(Amounts in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
The Operating Partnership 1998 1997 1998 1997
- ------------------------- ---- ---- ---- ----
Income of the Operating Partnership
before Extraordinary Items $43,514 $48,413 $88,638 $91,475
Plus: Depreciation and Amortization
from Consolidated Properties 58,082 43,774 116,161 87,086
Less: Minority Interest Portion of
Depreciation and Amortization (1,828) (1,664) (3,594) (2,514)
Plus: Simon's Share of Depreciation,
Amortization and Extraordinary Items
from Unconsolidated Affiliates 16,304 9,152 31,108 18,010
Plus: (Gain) Loss on Sales of Assets 7,219 17 7,219 (20)
Less: Preferred Dividends (7,334) (6,407) (14,668) (12,813)
-------- -------- -------- --------
FFO of the Operating Partnership $115,957 $93,285 $224,864 $181,224
Percent Increase 24.3% 24.1%
FFO of the Operating Partnership $115,957 $93,285 $224,864 $181,224
Basic FFO per Share:
- --------------------
Basic FFO Allocable to the Company $73,719 $57,416 $142,734 $111,408
Basic Weighted Average Partnership Units
Outstanding 176,099 158,494 174,600 158,222
Basic Weighted Average Common Shares
Outstanding 111,955 97,520 110,826 97,248
Basic FFO per Common Share of the
Company $0.66 $0.59 $1.29 $1.15
======== ======== ======== ========
Percent Increase 11.9% 12.2%
Diluted FFO per Share:
- ----------------------
Diluted FFO Allocable to the Company $73,857 $57,362 $142,961 $111,438
Diluted Weighted Average Partnership
Units Outstanding 176,441 158,338 174,989 158,597
Diluted Weighted Average Common Shares
Outstanding 112,382 97,364 111,215 97,623
Diluted FFO per Common Share of the
Company $ 0.66 $ 0.59 $ 1.29 $ 1.14
======== ======== ======== ========
Percent Increase 11.9% 13.2%
<PAGE>
SIMON DeBARTOLO GROUP
Selected Financial Information
As of June 30, 1998
(In thousands, except as noted)
As of or for the
Six Months Ended
June 30,
1998 1997 % Change
---- ---- --------
Financial Highlights
- --------------------
Total Revenue - Consolidated Properties $610,632 $487,469 25.3%
Total EBITDA of Portfolio Properties $591,258 $419,188 41.0%
EBITDA After Minority Interest $456,143 $338,957 34.6%
Net Income Available to Common
Shareholders $51,415 $33,184 54.9%
Basic Net Income per Common Share $0.46 $0.34 35.3%
Diluted Net Income per Common Share $0.46 $0.34 35.3%
FFO of the Operating Partnership $224,864 $181,224 24.1%
Basic FFO Allocable to the Company $142,734 $111,408 28.1%
Diluted FFO Allocable to the Company $142,961 $111,438 28.3%
Basic FFO per Common Share $1.29 $1.15 12.2%
Diluted FFO per Common Share $1.29 $1.14 13.2%
Common Stock Distributions, per Common
Share $0.5050 $0.5050 -
Operational Statistics
- ----------------------
Occupancy at End of Period:
Regional Malls (1) 87.0% 85.2% 1.8%
Community Shopping Centers (2) 90.5% 92.4% -1.9%
Average Base Rent per Square Foot:
Regional Malls (1) $23.10 $20.94 10.3%
Community Shopping Centers (2) $7.47 $7.75 -3.6%
Regional Malls:
Total Tenant Sales Volume, in
millions (3)(4) $4,200 $2,902 44.7%
Total Sales per Square Foot (4) $318 $293 8.5%
Comparable Sales per Square $328 $302 8.6%
Foot(4)
Number of Properties Open at End of
Period 216 186 16.1%
Total GLA at End of Period, in millions 139.0 113.8 22.1%
(1) Includes mall and freestanding stores.
(2) Includes all Owned GLA.
(3) Represents only those tenants who report sales.
(4) 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 less than 10,000 square feet.
<PAGE>
SIMON DeBARTOLO GROUP
Selected Financial Information
As of June 30, 1998
(In thousands, except as noted)
June 30, June 30,
Equity Information 1998 1997
- ------------------ ---- ----
Limited Partner Units Outstanding at
End of Period 64,183 60,974
Common Shares Outstanding at End of 113,678 97,657
Period -------- --------
Total Common Shares and Units 177,861 158,631
Outstanding at End of Period ======== ========
Basic Year-to-Date Weighted Average
Units Outstanding 63,774 60,974
Basic Year-to-Date Weighted Average 110,826 97,248
Common Shares Outstanding -------- --------
Basic Year-to-Date Weighted Average 174,600 158,222
Common Shares and Units Outstanding ======== ========
June 30, December 31,
1998 1997
---- ----
Selected Balance Sheet Information
- ----------------------------------
Total Assets $7,932,815 $7,662,667
Consolidated Debt $5,228,015 $5,077,990
SDG Share of Joint Venture Debt $1,097,292 $770,776
Debt-to-Market Capitalization
- -----------------------------
Common Stock Price at End of Period $32.50 $32.6875
Equity Market Capitalization (1) $6,137,476 $5,966,702
Total Consolidated Capitalization $11,365,491 $11,044,692
Consolidated Debt-to-Market
Capitalization 46.0% 46.0%
Total Capitalization - Including SDG
Share of JV Debt $12,462,783 $11,815,468
Debt-to-Market Capitalization -
Including SDG Share of JV Debt 50.8% 49.5%
(1) Market value of Common Stock, Units and Series B Preferred Stock
plus book value of Series C Preferred Stock.
<PAGE>
SIMON DeBARTOLO GROUP
Portfolio GLA, Occupancy & Rent Data
As of June 30, 1998
Avg.
Annualized
% of Base Rent
Owned GLA Per Leased
Type of Total % of Which Sq. Ft. of
Property GLA-Sq. Ft. Owned GLA Owned GLA is Leased Owned GLA
Regional Malls
- --------------
- -Anchor 70,755,660 24,198,736 28.4% 96.8% $3.39
- -Mall Store 39,599,123 39,566,527 46.4% 86.6% 23.84
- -Freestanding 2,954,025 1,679,302 2.0% 95.3% 7.65
---------- ----------
Subtotal 42,553,148 41,245,829 48.4% 87.0% 23.10
Regional Mall
Total 113,308,808 65,444,565 76.8% 90.6% $15.41
Community Shopping
Centers
- ------------------
- -Anchor 12,274,379 7,925,786 9.3% 93.6% $6.03
- -Mall Store 4,661,096 4,575,338 5.4% 84.4% 10.38
- -Freestanding 985,669 457,562 .5% 97.6% 6.52
Community Ctr.
Total 17,921,144 12,958,686 15.2% 90.5% $7.47
Office Portion
of Mixed-Use
Properties 2,255,521 2,255,521 2.6% 92.6% $19.07
Value-Oriented
Super-Regional
Malls 3,729,498 3,587,903 4.2%
Properties under
Redevelopment 1,820,000 1,015,000 1.2%
GRAND TOTAL 139,034,971 85,261,675 100.00%
Occupancy History
-----------------------------------------------------------
Community
As of Regional Malls(1) Shopping Centers(2)
------ --------------- ----------------
6/30/98 87.0% 90.5%
6/30/97 85.2% 92.4%
12/31/97 87.3% 91.3%
12/31/96 84.7% 91.6%
12/31/95(3) 85.5% 93.6%
12/31/94(3) 85.6% 93.9%
(1) Includes mall and freestanding stores.
(2) Includes all Owned GLA.
(3) On a pro forma combined basis giving effect to the Merger with
DeBartolo Realty Corporation ("DRC") for periods presented.
<PAGE>
SIMON DeBARTOLO GROUP
Rent Information
As of June 30, 1998
Average Base Rent
- -----------------
Mall &
Freestanding
Stores at % Community %
As of Regional Malls Change Shopping Centers Change
- ------- ------------- ------ --------------- ------
6/30/98 $23.10 10.3% $7.47 -3.6%
6/30/97 20.94 - 7.75 -
12/31/97 $23.65 14.4% $7.44 -2.7%
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
Rental Rates
- ----------
Base Rent(2)
------------
Store Openings Store Closings Amount of Change
Year During Period During Period Dollar Percentage
- ---- ------ ------ ------ ----------
Regional Malls:
- ---------------
1998 (YTD) $24.97 $19.52 $5.45 27.9%
1997 29.66 21.26 8.40(3) 39.5(3)
1996 23.59 18.73 4.86 25.9
Community Shopping Centers:
- ---------------------------
1998 (YTD) $10.35 $10.61 $(0.26) (2.5)%
1997 8.63 9.44 ($0.81) (8.6)%
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.
(3) Including the acquisitions of Dadeland Mall, The Fashion Mall at
Keystone at the Crossing, the RPT properties and the opening of The
Source. Excluding these events, the spread was $6.57, or a 30.9%
increase.
<PAGE>
SIMON DeBARTOLO GROUP
Lease Expirations(1)
As of June 30, 1998
Number of Square Avg. Base Rent
Year Leases Expiring Feet per Square Foot
at 6/30/98
Regional Malls - Mall & Freestanding Stores
- -----------------
- -----------------
1998 (7/1-12/31) 289 545,074 25.35
1999 1,387 2,911,609 22.83
2000 1,359 2,711,907 23.89
2001 1,182 2,814,383 22.89
2002 1,140 2,624,489 22.66
2003 1,188 2,802,374 23.48
2004 970 2,800,005 24.16
2005 993 3,281,933 23.78
2006 1,080 3,177,110 24.89
2007 898 2,648,032 26.86
2008 730 2,792,572 26.42
--------------- ------------ ---------
TOTALS 11,216 29,109,488 $24.22
Regional Malls - Anchor Tenants
- -----------------
--------------
1998 (7/1-12/31) 4 518,859 1.41
1999 13 1,481,367 2.49
2000 14 2,031,903 1.88
2001 13 1,708,149 2.25
2002 10 1,201,408 1.70
2003 12 1,309,574 2.97
2004 17 1,614,364 3.70
2005 14 1,557,105 2.99
2006 14 1,622,185 3.28
2007 6 556,374 2.86
2008 9 993,714 3.59
--------------- ------------ -------
TOTALS 126 14,595,002 $2.69
Community Centers - Mall Stores & Freestanding Stores
- -----------------
- -----------------
-------------
1998 (7/1-12/31) 42 99,507 10.87
1999 179 525,426 11.34
2000 250 684,432 11.04
2001 172 516,056 11.56
2002 117 533,149 9.43
2003 89 391,242 10.96
2004 35 266,136 7.99
2005 31 233,611 10.02
2006 18 246,380 6.96
2007 11 119,295 8.65
14 123,362 9.47
--------------- ------------ -------
TOTALS 958 3,738,596 $10.24
(1) Does not consider the impact of options that may be contained in
leases.
<PAGE>
Community Centers - Anchor Tenants
- -----------------
- -----------------
1998 (7/1-12/31) - - -
1999 9 391,002 3.44
2000 9 318,438 5.05
2001 12 519,448 3.98
2002 8 266,118 6.50
2003 10 299,248 6.72
2004 8 205,700 6.66
2005 11 630,445 5.61
2006 10 660,361 5.46
2007 13 694,932 5.81
2008 8 352,104 6.68
--------------- ------------ --------
TOTALS 98 4,337,796 $5.47
(1) Does not consider the impact of options that may be contained in
leases.
<PAGE>
SIMON DeBARTOLO GROUP
SDG's Share of Total Debt Amortization and Maturities by Year
As of June 30, 1998
(In thousands)
SDG's Share SDG's Share SDG's Share of SDG's Share
of Secured of Unsecured Unconsolidated of
Consolidated Consolidated Joint Venture Total
Year Debt Debt Secured Debt Debt
1998.. 0 232,335 70,000 4,360 306,695
1999.. 1 201,043 90,000 101,885 392,928
2000.. 2 301,660 0 125,292 426,952
2001.. 3 252,513 0 84,464 336,976
2002.. 4 574,138 0 115,671 689,809
2003.. 5 78,703 475,000 165,196 718,900
2004.. 6 493,538 250,000 40,569 784,108
2005.. 7 43,765 660,000 92,881 796,645
2006.. 8 109,255 250,000 214,829 574,084
2007.. 9 131,337 180,000 46,339 357,677
2008.. 10 2,323 0 104,667 106,990
Thereafter 145,437 550,000 1,139 696,576
------------ ------------ ------------ ------------
$ 2,566,047 $ 2,525,000 $ 1,097,292 $6,188,339
============= ============= ============= ------------
Premiums and Discounts on
Indebtedness, Net (2,025)
------------
SDG's Share of Total Indebtedness * $6,186,314
============
<PAGE>
SIMON DeBARTOLO GROUP
Summary of Indebtedness
As of June 30, 1998
(In thousands)
SDG's Share Weighted
Total of Avg. Weighted Avg.
Indebted-ness Indebted-ness Interest Years to
Rate Maturity
Consolidated Indebtedness
Mortgage Debt
Fixed Rate 2,208,783 2,126,232 7.65% 5.9
Debt Swapped to Maturity 50,000 50,000 7.74% 3.2
Capped to Maturity,
Currently "In the Money" 239,379 203,349 6.29% 1.8
Other Hedged Debt 100,000 100,000 6.12% 4.0
Floating Rate Debt 107,209 86,465 7.12% 2.3
------------- ------------- -------- -------------
Subtotal Mortgage Debt 2,705,371 2,566,046 7.47% 5.3
Unsecured Debt
Fixed Rate 2,365,000 2,365,000 6.93% 10.1
Capped to Maturity,
Currently "In the Money" 63,000 63,000 6.14% 0.6
Other Hedged Debt 63,000 63,000 6.31% 0.2
Floating Rate Debt 7,000 7,000 6.31% 0.2
------------- ------------- -------- ------------
Subtotal 2,498,000 2,498,000 6.89% 9.6
Corporate Credit Facility
(Hedged) 27,000 27,000 6.31% 1.2
------------- ------------- -------- ------------
Subtotal Unsecured Debt 2,525,000 2,525,000 6.88% 9.5
Adjustment to Fair Market
Value - Fixed Rate (3,830) (3,500) N/A N/A
Adjustment to Fair Market
Value - Variable Rate 1,474 1,475 N/A N/A
------------- ------------ -------- ------------
Consolidated Mortgage and
Other Notes Payable 5,228,015 5,089,022 7.18% 7.4
============ ============ ======== ============
Joint Venture Mortgage
Indebtedness
Fixed Rate 1,559,943 755,449 7.45% 6.5
Debt Swapped to Maturity 120,000 30,000 7.38% 3.9
Other Hedged Debt 384,188 137,930 6.37% 4.6
Floating Rate Debt 423,835 173,912 6.63% 2.3
------------ ------------ -------- -----------
Joint Venture Mortgage
and Other Notes Payable 2,487,966 1,097,292 7.18% 5.6
============ ============ ======== ============
SDG's Share of Total
Indebtedness 6,186,314 7.18% 7.1
(1) This Principal Mutual Pool 1 loan is secured by cross-collateralized
mortgages encumbering four of the Properties (Anderson, Forest
Village Park, Longview and South Park). A weighted average rate is
used for these Pool 1 Properties.
(2) This Principal Mutual Pool 2 loan is secured by cross-collateralized
mortgages encumbering seven of the Properties (Eastland, Forest
Mall, Golden Ring, Hutchinson, Markland, Midland, and North Towne).
A weighted average rate is used for these Pool 2 Properties.
(3) An interest rate protection agreement, which effectively fixes the
interest rate at an all-in-one rate of 6.16%, was obtained on July
16, 1998.
(4) Includes applicable extensions available at the Operating
Partnership's option.
(5) Represents debt assumed in connection with the Macerich
acquisition. This is $485 million of Commercial Mortgage Notes
secured by cross-collateralized mortgages encumbering thirteen of
the Properties. The Operating Partnership's share is $242 million.
A weighted average rate is used.
(6) Notes for purchase of land from Ontario Redevelopment Agency at 6%
commencing January 2000.
(7) Two one-year options exist to extend maturity.
<PAGE>
SIMON DeBARTOLO GROUP
Summary of Indebtedness By Maturity
As of June 30, 1998
(In thousands)
SDG's Weighted
Avg
Property Share of Interest
Maturity Interest Total Rate
Name Date Rate Indebted- Indebted- by Year
ness ness
Consolidated Indebtedness
Fixed Rate Mortgage Debt:
Ross Park Mall 8/15/98 6.14% 60,000 60,000
Subtotal 1998 60,000 60,000 6.14%
Great Lakes Mall 3/1/99 7.07% 8,550 8,550
Ingram Park Mall 11/1/99 9.63% 7,000 7,000
Ingram Park Mall 12/1/99 8.10% 48,274 48,274
Barton Creek Square 12/30/99 8.10% 62,474 62,474
La Plaza Mall 12/30/99 8.25% 49,765 49,765
Subtotal 1999 176,063 176,063 8.15%
Windsor Park Mall 6/1/00 8.00% 5,861 5,861
Trolley Square 7/23/00 5.81% 19,000 17,100
North East Mall 9/1/00 10.00% 22,071 22,071
Bloomingdale Court 12/1/00 8.75% 29,009 29,009
Forest Plaza 12/1/00 8.75% 16,904 16,904
Fox River Plaza 12/1/00 8.75% 12,654 12,654
Lake View Plaza 12/1/00 8.75% 22,169 22,169
Lincoln Crossing 12/1/00 8.75% 997 997
Matteson Plaza 12/1/00 8.75% 11,159 11,159
Regency Plaza 12/1/00 8.75% 1,878 1,878
St. Charles Towne Plaza 12/1/00 8.75% 30,742 30,742
West Ridge Plaza 12/1/00 8.75% 4,612 4,612
White Oaks Plaza 12/1/00 8.75% 12,345 12,345
Subtotal 2000 189,401 187,501 8.61%
Biltmore Square 1/1/01 7.15% 27,115 27,115
Chesapeake Square 1/1/01 7.28% 48,839 48,839
Port Charlotte Town Center 1/1/01 7.28% 53,031 53,031
Great Lakes Mall 3/1/01 6.74% 53,028 53,028
Subtotal 2001 182,013 182,013 7.10%
Lima Mall 3/1/02 7.12% 19,037 19,037
Columbia Center 3/15/02 7.62% 42,602 42,602
Northgate Shopping Center 3/15/02 7.62% 79,550 79,550
Tacoma Mall 3/15/02 7.62% 93,076 93,076
River Oaks Center 6/1/02 8.67% 32,500 32,500
Crossroads Mall 7/31/02 7.75% 41,440 41,440
North Riverside Park Plaza 9/1/02 9.38% 3,988 3,988
North Riverside Park Plaza 9/1/02 10.00% 3,617 3,617
(1)
Principal Mutual Mortgages
- - Pool 1 9/15/02 6.81% 103,698 103,698
(2)
Principal Mutual Mortgages
- - Pool 2 9/15/02 6.77% 137,823 137,823
Subtotal 2002 557,331 557,331 7.34%
Battlefield Mall 6/1/03 7.50% 49,207 49,207
Miami International Mall 12/21/03 6.91% 46,751 28,051
Subtotal 2003 95,958 77,258 7.29%
Forum Phase I - Class A-1 5/15/04 7.13% 46,997 28,198
Forum Phase II - Class A-1 5/15/04 7.13% 43,004 23,652
<PAGE>
Cielo Vista Mall 7/1/04 8.13% 2,323 2,323
College Mall 7/1/04 7.00% 42,653 42,653
Greenwood Park Mall 7/1/04 7.00% 35,723 35,723
Tippecanoe Mall 7/1/04 8.45% 46,618 46,618
Towne East Square 7/1/04 7.00% 56,393 56,393
CMBS Loan - Fixed
Component 12/19/04 7.27% 175,000 175,000
Subtotal 2004 448,711 410,560 7.30%
Melbourne Square 2/1/05 7.42% 39,626 39,626
Subtotal 2005 39,626 39,626 7.42%
Treasure Coast Square 1/1/06 7.42% 53,592 53,592
Gulf View Square 10/1/06 8.25% 37,901 37,901
Paddock Mall 10/1/06 8.25% 30,143 30,143
Subtotal 2006 121,636 121,636 7.88%
Cielo Vista Mall 5/1/07 9.38% 55,264 55,264
McCain Mall 5/1/07 9.38% 25,917 25,917
Valle Vista Mall 5/1/07 9.38% 34,326 34,326
University Park Mall 10/1/07 7.43% 59,500 35,700
Subtotal 2007 175,007 151,207 8.92%
Randall Park Mall 6/18/08 7.33% 35,000 35,000
Subtotal 2008 35,000 35,000 7.33%
Windsor Park Mall 5/1/12 8.00% 8,863 8,863
Subtotal 2012 8,863 8,863 8.00%
Chesapeake Center 5/15/15 8.44% 6,563 6,563
Grove at Lakeland Square,
The 5/15/15 8.44% 3,750 3,750
Terrace at Florida Mall,
The 5/15/15 8.44% 4,688 4,688
Subtotal 2015 15,001 15,001 8.44%
Sunland Park Mall 1/1/26 8.63% 39,684 39,684
Subtotal 2026 39,684 39,684 8.63%
Keystone at the Crossing 7/1/27 7.85% 64,489 64,489
Subtotal 2027 64,489 64,489 7.85%
Total Consolidated Fixed
Rate Mortgage Debt 2,208,783 2,126,232 7.65%
<PAGE>
Variable Rate Mortgage
Debt:
Eastgate Consumer Mall 12/31/98 6.00% 22,929 22,929
Riverway 12/31/98 6.38% 131,451 131,451
Subtotal 1998 154,380 154,380 6.32%
White Oaks Mall 3/1/99 6.93% 16,500 9,062
Subtotal 1999 16,500 9,062 6.93%
Jefferson Valley Mall 1/12/00 6.21% 50,000 50,000
(7)
Shops at Sunset Place, The 6/30/00 6.91% 49,965 37,474
Trolley Square 7/23/00 7.22% 8,141 7,327
Subtotal 2000 108,106 94,801 6.56%
Crystal River 1/1/01 7.66% 16,000 16,000
Orland Square 9/1/01 7.74% 50,000 50,000
Subtotal 2001 66,000 66,000 7.72%
Highland Lakes Center 3/1/02 7.16% 14,377 14,377
Mainland Crossing 3/31/02 7.16% 2,226 2,226
Subtotal 2002 16,603 16,603 7.16%
Forum Phase I - Class A-2 5/15/04 6.19% 44,385 26,631
Forum Phase II - Class A-2 5/15/04 6.19% 40,614 22,338
(3)
CMBS Loan - Floating
Component 12/19/04 6.03% 50,000 50,000
Subtotal 2004 134,999 98,969 6.11%
Total Variable Rate
Mortgage Debt 496,586 439,814 6.58%
Total Consolidated
Mortgage Debt 2,705,369 2,566,046 7.47%
Fixed Rate Unsecured Debt:
SDG, LP (Bonds) 6/15/03 6.63% 375,000 375,000
SDG, LP (PATS) 11/15/03 6.75% 100,000 100,000
Subtotal 2003 475,000 475,000 6.65%
SCA (Bonds) 1/15/04 6.75% 150,000 150,000
SDG, LP (Bonds) 7/15/04 6.75% 100,000 100,000
Subtotal 2004 250,000 250,000 6.75%
SCA (Bonds) 5/15/05 7.63% 110,000 110,000
SDG, LP (Bonds) 6/15/05 6.75% 300,000 300,000
SDG, LP (Bonds) 10/27/05 6.88% 150,000 150,000
SDG, LP (MTN) 6/24/05 7.13% 100,000 100,000
Subtotal 2005 660,000 660,000 6.98%
<PAGE>
SDG, LP (Bonds) 11/15/06 6.88% 250,000 250,000
Subtotal 2006 250,000 250,000 6.88%
SDG, LP (MTN) 9/20/07 7.13% 180,000 180,000
Subtotal 2007 180,000 180,000 7.13%
SDG, LP (Bonds) 7/15/09 7.00% 150,000 150,000
Subtotal 2009 150,000 150,000 7.00%
SDG, LP (Bonds) 6/15/18 7.38% 200,000 200,000
Subtotal 2018 200,000 200,000 7.38%
SDG, LP (MOPPRS) 6/15/28 7.00% 200,000 200,000
Subtotal 2028 200,000 200,000 7.00%
Total Unsecured Fixed Rate
Debt 2,365,000 2,365,000 6.93%
Variable Rate Unsecured
Debt:
(7)
SDG, L.P. Unsecured Loan 9/25/98 6.31% 70,000 70,000
Subtotal 1998 70,000 70,000 6.31%
Corporate Credit Facility 9/27/99 6.31% 27,000 27,000
Subtotal 1999 27,000 27,000 6.31%
(4)
SDG, L.P. Unsecured Loan 1/31/00 6.14% 63,000 63,000
Subtotal 2000 63,000 63,000 6.14%
Total Unsecured Variable
Rate Debt 160,000 160,000 6.24%
Total Unsecured Debt 2,525,000 2,525,000 6.88%
Adjustment of Fixed-Rate
Indebtedness to FMV (3,830) (3,500) N/A
Adjustment of Variable-
Rate Indebtedness to FMV 1,474 1,475 N/A
Total Consolidated Debt 5,228,013 5,089,022 7.18%
Joint Venture Indebtedness
Fixed Rate Mortgage Debt:
Florida Mall, The 2/28/00 6.65% 90,000 90,000
Northfield Square 4/1/00 9.52% 24,196 24,196
Coral Square 12/1/00 7.40% 53,300 26,650
Subtotal 2000 167,496 140,846 7.28%
Palm Beach Mall 12/15/02 8.21% 50,925 25,463
Subtotal 2002 50,925 25,463 8.21%
Avenues, The 5/15/03 8.36% 58,059 14,515
Century III Mall -1 7/1/03 6.78% 66,000 33,000
Lakeland Square 12/22/03 7.26% 52,696 26,348
Subtotal 2003 176,755 73,863 7.26%
Indian River Commons 11/1/04 7.58% 8,399 4,200
Indian River Mall 11/1/04 7.58% 46,602 23,301
Subtotal 2004 55,001 27,501 7.58%
<PAGE>
Westchester, The 9/1/05 8.74% 152,681 76,341
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
Plaza at Buckland Hills,
The 11/30/05 7.22% 17,907 6,133
Ridgewood Court 11/30/05 7.22% 7,980 2,793
Royal Eagle Plaza 11/30/05 7.22% 7,467 2,613
Village Park Plaza 11/30/05 7.22% 9,187 3,215
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
Yards Plaza, The 11/30/05 7.22% 8,270 2,895
Subtotal 2005 252,681 107,664 8.30%
Seminole Towne Center 1/1/06 6.88% 70,500 31,725
(5)
IBM CMBS Loan - Fixed
Component 5/1/06 7.40% 300,000 150,000
Great Northeast Plaza 6/1/06 9.04% 17,744 8,872
Smith Haven Mall 6/1/06 7.86% 115,000 28,750
Subtotal 2006 503,244 219,347 7.45%
Lakeline Mall 5/1/07 7.65% 73,280 54,960
Subtotal 2007 73,280 54,960 7.65%
Aventura Mall - A 4/6/08 6.55% 141,000 47,000
Aventura Mall - B 4/6/08 6.60% 25,400 8,467
Aventura Mall - C 4/6/08 6.89% 33,600 11,200
West Town Mall 5/1/08 6.90% 76,000 38,000
Subtotal 2008 276,000 104,667 6.72%
(6)
Ontario Mills 12/28/09 0.00% 4,561 1,140
Subtotal 2009 4,561 1,140 0.00%
Total Joint Venture Fixed
Rate Mortgage Debt 1,559,943 755,449 7.45%
Variable Rate Mortgage
Debt:
(7)
Tower Shops, The 3/13/99 6.86% 14,300 7,150
Dadeland Mall 12/10/99 6.36% 140,000 70,000
Subtotal 1999 154,300 77,150 6.41%
Grapevine Mills 4/25/01 7.01% 127,027 47,635
(4)
Source, The 7/16/01 7.01% 115,508 28,877
Subtotal 2001 242,535 76,512 7.01%
Arizona Mills 2/1/02 6.96% 139,188 36,628
Lakeline Plaza 6/6/02 6.04% 27,000 20,250
(7)
Ontario Mills 5/7/02 7.37% 50,000 12,500
(7)
Ontario Mills 5/7/02 7.21% 20,000 5,000
(7)
Ontario Mills 5/7/02 7.46% 50,000 12,500
Subtotal 2002 286,188 86,878 6.89%
<PAGE>
IBM CMBS Loan - Floating (5)
Component 5/1/03 6.16% 185,000 92,500
Subtotal 2003 185,000 92,500 6.16%
Circle Centre Mall 1/31/04 6.10% 60,000 8,802
Subtotal 2004 60,000 8,802 6.10%
Total Joint Venture
Variable Rate Debt 928,023 341,843 6.59%
Total Joint Venture Debt 2,487,966 1,097,292 7.18%
SDG's Share of Total
Indebtedness 7,715,979 6,186,314 7.18%
(1) This Principal Mutual Pool 1 loan is secured by cross-collateralized
mortgages encumbering four of the Properties (Anderson, Forest Village
Park, Longview and South Park). A weighted average rate is used for these
Pool 1 Properties.
(2) This Principal Mutual Pool 2 loan is secured by cross-collateralized
mortgages encumbering seven of the Properties (Eastland, Forest Mall,
Golden Ring, Hutchinson, Markland, Midland, and North Towne). A weighted
average rate is used for these Pool 2 Properties.
(3) An interest rate protection agreement, which effectively fixes the
interest rate at an all-in-one rate of 6.16%, was obtained on July 16,
1998.
(4) Includes applicable extensions available at the Operating Partnership's
option.
(5) Represents debt assumed in connection with the Macerich acquisition. This
is $485 million of Commercial Mortgage Notes secured by cross-
collateralized mortgages encumbering thirteen of the Properties. The
Operating Partnership's share is $242 million. A weighted average rate is
used.
(6) Notes for purchase of land from Ontario Redevelopment Agency at 6%
commencing January 2000.
(7) Two one-year options exist to extend maturity.
<PAGE>
<TABLE>
SIMON DeBARTOLO GROUP
Summary of Variable Rate Debt and Interest Rate Protection Agreements
As of June 30, 1998
(In thousands)
<CAPTION>
SDG's
Property Principal Share of Interest Terms of Terms of
Name Balance SDG Loan Rate Variable Interest Rate
Date 06/30/98 Ownership % Balance 06/30/98 Rate Protection Agreement
<S> <C> <C> <S>
Consolidated Properties:
Secured Debt:
<C> LIBOR Capped at
LIBOR + 5.00% through
Eastgate Consumer Mall 12/31/98 22,929 100.00% 22,929 6.000% 1.000% maturity
LIBOR Capped at
LIBOR + 5.00% through
Riverway 12/31/98 131,451 100.00% 131,451 6.375% 1.375% maturity
LIBOR + 90-day LIBOR set on
White Oaks Mall 3/1/99 16,500 54.92% 9,062 6.926% 1.250% May 29, 1998
LIBOR Capped at
LIBOR + 8.70% through
Jefferson Valley Mall 1/12/00 50,000 100.00% 50,000 6.210% .550% maturity
LIBOR +
Shops at Sunset Place, The 6/30/00 49,965 75.00% 37,474 6.910% 1.250% See Footnote (1)
LIBOR +
Trolley Square 7/23/00 8,141 90.00% 7,327 7.219% 1.500%
LIBOR Swapped at
LIBOR + 7.24% through
Orland Square 9/1/01 50,000 100.00% 50,000 7.742% .500% maturity
LIBOR +
Crystal River 1/1/01 16,000 100.00% 16,000 7.660% 2.000%
LIBOR +
Highland Lakes Center 3/1/02 14,377 100.00% 14,377 7.160% 1.500%
LIBOR +
Mainland Crossing 3/31/02 2,226 100.00% 2,226 7.160% 1.500%
Through an interest
rate protection
LIBOR + agreement,
Forum Phase I - Class A-2 5/15/04 44,385 60.00% 26,631 6.190% .300% effectively fixed
at an all-in-one rate
of 6.19%
Through an interest
rate protection
LIBOR + agreement,
Forum Phase II - Class A-2 5/15/04 40,614 55.00% 22,338 6.190% .300% effectively fixed
at an all-in-one rate
of 6.19%
LIBOR Capped at
16.77% through
CMBS Loan - Floating LIBOR + maturity. See
Component 12/19/04 50,000 100.00% 50,000 6.025% .365% Footnote (2)
Total Consolidated Secured
Debt 496,588 439,814
Unsecured Debt:
LIBOR +
SDG, L.P. Unsecured Loan 9/25/98 70,000 100.00% 70,000 6.310% .650% See Footnote (3)
A two year interest
rate protection
agreement, which
LIBOR + effectively fixes the
SDG, L.P. Unsecured Loan 1/31/99 63,000 100.00% 63,000 6.140% .650% interest
rate at an all-in-
one rate of 6.14%,
was obtained January
15, 1998.
Unsecured Revolving Credit LIBOR +
Facility - UBS (1.25B) 9/27/99 27,000 100.00% 27,000 6.310% .650% See Footnote (3)
Total Consolidated
Unsecured Debt 160,000 160,000
Adjustment of Variable-
Rate Indebtedness to FMV 1,474 1,475
Consolidated Variable Rate
Debt 658,062 601,289
<PAGE>
Joint Venture Properties:
Two one-year
LIBOR + extensions exist to
Tower Shops, The 3/13/99 14,300 50.00% 7,150 6.860% 1.200% extend maturity.
LIBOR +
Dadeland Mall 12/10/99 140,000 50.00% 70,000 6.360% .700%
LIBOR +
Grapevine Mills 4/25/01 127,027 37.50% 47,635 7.010% 1.350% See Footnote (1)
LIBOR +
Source, The 7/16/01 115,508 25.00% 28,877 7.010% 1.350%
LIBOR Capped at
LIBOR + 9.50% through
Arizona Mills 2/1/02 139,188 26.32% 36,628 6.960% 1.300% maturity
LIBOR Swapped at
6.37% through
LIBOR + maturity. See
Ontario Mills 5/7/02 50,000 25.00% 12,500 7.370% 1.000% Footnote (1).
LIBOR Swapped at
LIBOR + 6.21% through
Ontario Mills 5/7/02 20,000 25.00% 5,000 7.210% 1.000% maturity
LIBOR Swapped at
LIBOR + 6.21% through
Ontario Mills 5/7/02 50,000 25.00% 12,500 7.460% 1.250% maturity
LIBOR +
Lakeline Plaza 6/6/02 27,000 75.00% 20,250 6.035% .375%
The Operating
See Partnership took
IBM CMBS Loan - Floating Footnote assignment of an
Component 5/1/03 185,000 50.00% 92,500 6.158% (4) interest rate
protection agreement
relating to the
Macerich debt
assumed.
LIBOR Capped at
LIBOR + 8.81% through
Circle Centre Mall 1/31/04 60,000 14.67% 8,802 6.100% .440% maturity
Total Joint Venture
Properties 928,023 341,843
Total Variable Mortgage
and Other Indebtedness 1,586,085 943,132
</TABLE>
Footnotes:
(1) Rate can be reduced based upon project performance.
(2) An interest rate protection agreement, which effectively fixes
the interest rate at an all-in-one rate of 6.16%, was obtained on July 20,
1998. The existing cap will be applied to other unhedged debt.
(3) The 11.53% LIBOR cap on $90M has been transferred from Forum to
hedge these two pieces of debt.
(4) Represents debt assumed in the Macerich acquisition. A weighted
average rate is used.
The following table summarizes variable rate debt:
Total SDG Share
Swapped debt 170,000 80,000
Capped debt "in the
money" 302,379 266,349
Other hedged
variable rate debt 574,188 327,930
Unhedged variable
rate debt 539,518 268,853
1,586,085 943,132
<PAGE>
SIMON DeBARTOLO GROUP
New Development Activities
As of June 30, 1998
Non-Anchor
SDG Actual/ Projected Sq. Footage
Mall/ Ownership Projected Cost Leased/ GLA
Location Percentage Opening (in millions) Committed (sq. ft.)
- ------------------- ---------- ---------- ------------- ------------ -------
Projects Recently
Opened
Lakeline Plaza 80% 4/98 $34 85%(1) 367,000
Austin, TX
(center opened
4/98)
Anchors/Major Tenants:
Linens 'N Things, TJMaxx, Old Navy, OfficeMax, Party City
Toys "R" Us (9/98 opening)
Leased/Committed of 85% is based on 239,000 sf built to date. Remaining
square footage to open at a later date.
Projects Under
Construction
Shops at Sunset 75% 12/98 $150 93% 510,000
Place
South Miami, FL
Anchors/Major Tenants:
AMC 24 Theatre, NIKETOWN, Barnes & Noble, IMAX Theatre, Virgin
Megastore, Z Gallerie, GameWorks, FAO Schwarz
Concord Mills 50% Fall 1999 $218 (2) 1,400,000
Concord, NC
(Charlotte)
Anchors/Major Tenants:
Books-A-Million, Bed Bath & Beyond, TJMaxx, Off Rodeo Drive
Beverly Hills, Bass Pro Outdoor World, AMC Theatres, Host Marriott
Services (food court)
Projects Under
Development
Houston Premium Phase I -
Outlets 50% 9/99 $85 (2) 462,000
Houston, TX
Anchors/Major Tenants:
Last Call Neiman Marcus Clearance Center, Off 5th-Saks Fifth Avenue
Outlet
The Shops at
Northeast Plaza 100% Fall 1999 $40 (2) 320,000
Hurst, TX
Anchors/Major Tenants:
To be announced
(1) Community Center leased/committed percentage includes owned anchor
GLA.
(2) Leasing still in preliminary stage.
<PAGE>
SIMON DeBARTOLO GROUP
Renovation/ Expansion Activities
As of June 30, 1998
Total
SDG Actual/ Projected Existing
Mall/ Ownership Anticipated Cost Year GLA
Location Percentage Completion (in Built (sq. ft.)
millions)
- ---------------------- ---------- ------------ ------------ ------- --------
Projects Under
Construction
Castleton Square 100% 11/98 $34 1972 1,353,000
Indianapolis, IN
(Renovation/Expansion)
Scope of Construction:
Addition of 80,000 sq. ft. Galyan's and 10,000 sq. ft. of small shops;
mall renovation with new food court; L.S. Ayres 48,000 sq. ft.
expansion; Lazarus remodel; addition of Von Maur to replace Montgomery
Ward
The Florida Mall 50% 11/99 $86 1986 1,120,000
Orlando, FL
(Expansion)
Scope of Construction:
Addition of 200,000 sq. ft. Burdines and 190,000 sq. ft. of shops;
Dillard's 42,000 sq. ft. expansion (9/98 opening); JCPenney 62,000 sq.
ft. expansion (10/98 opening); Saks 15,000 sq. ft. expansion
Mission Viejo Mall 100% Fall 1999 $146 1979 817,000
Mission Viejo, CA
(Renovation/Expansion)
Scope of Construction:
Additions of 160,000 sq. ft. Nordstrom, 100,000 sq. ft Saks Fifth Avenue
and 120,000 sq. ft. of future retail; small shop expansions of 130,000
sq. ft. to open in 1999 and an additional 88,000 sq. ft. to open in
2000; renovation with new food court; Macy's 70,000 sq. ft. expansion
and Robinson-May 70,000 sq. ft. expansion
Prien Lake Mall 100% 11/98 $30 1972 456,000
Lake Charles, LA
(Renovation/Expansion)
Scope of Construction:
Addition of 157,000 sq. ft. Dillard's and 124,000 sq. ft. Sears with
10,000 sq. ft. TBA; renovation of existing mall and exterior of JCPenney
building and 70,000 sq. ft. expansion of shops with food court
Richmond Town Square 100% 11/98 $57 1966 873,000
Cleveland, OH
(Renovation/Expansion)
Scope of Construction:
Addition of 165,000 sq. ft. Kaufmann's and JCPenney remodel;
(addition of Barnes & Noble, Sony Theatre, new food court and Sears
remodel to be complete 9/99)
<PAGE>
Projects Under
Development
North East Mall 100% Fall 2000 $110 1971 1,142,000
Hurst, TX
(Renovation/Expansion)
Scope of Construction:
Addition of 60,000 square feet of small shops, 143,000 sq. ft.
Nordstrom, 100,000 sq. ft. Saks Fifth Avenue and one additional
department store; 48,000 sq. ft.expansion of JCPenney; new 300,000 sq.
ft. Dillard's; mall renovation in addition to renovations of Sears and
Montgomery Ward
<PAGE>
SIMON DeBARTOLO GROUP
Other Renovation/Expansion Activities
Projects Under Construction as of June 30, 1998
SDG's Projected
Project Name Location Scope of Project % Completion
Anderson Mall Anderson, SC Addition of Goody's 100% 11/98
Phase I - Addition of Old 9/98
Navy (Finish Line and new
food court opened 5/98) 100%
Barton Creek Phase II - Addition of
Square Austin, TX General Cinema 5/99
Battlefield
Mall Springfield, IL Addition of Ethan Allen 100% 11/98
Addition of Old Navy,
Dillard's Men's Store, and
Broadway small shops; Dillard's
Square Tyler, TX expansion 100% 6/99
Brunswick Addition of Barnes &
Square East Brunswick, Noble, theatre expansion
NJ and police substation 100% 10/99
Charles Towne Mall demolition and
Square conversion to community
center; addition of Regal
Cinema and renovation of
Charleston, SC Montgomery Ward 100% 12/98
Crossroads
Mall Omaha, NE Mall renovation 100% 11/98
Eastern Hills Addition of Burlington
Mall Buffalo, NY Coat 100% 8/98
Addition of Sears, Staples
Forest Mall Fond du Lac, WI and mall renovation 100% 10/98
Gulf View Remodel with new food
Square Port Richey, FL court 100% 3/99
Independence Renovation and food court
Center Independence,MO relocation 100% 11/98
Phase I - Addition of 8/98
Barnes & Noble (Old Navy
opened 5/98) 100%
Phase II - Addition of
Irving Mall Irving, TX General Cinema 12/98
Laguna Hills Addition of WOW
Mall Laguna Hills, CA Entertainment 100% 8/98
Longview Mall Longview, TX Mall renovation 100% 10/98
Orange Park Addition of Books-A-
Mall Jacksonville, FL Million 100% 10/98
Port Charlotte Port Charlotte,
Towne Ctr FL Addition of Regal Cinema 100% 11/98
Addition of Steinmart and
Ross Dress for Less, new
Richardson food court and mall
Square Mall Dallas, TX renovation 100% 7/98
Split Kmart space into
three suites; addition of
Teal Plaza Lafayette, IN Circuit City and Pep Boys 100% 8/98
Towne West
Square Wichita, KS Addition of Petsmart 100% 9/98
Addition of Borders and
mall renovation (new food
St. Petersburg, court and restaurants
Tyrone Square FL opened 6/98) 100% 3/99
Valle Vista
Mall Harlingen, TX Addition of OfficeMax 100% 12/98
Addition of Regal Cinema
West Town Mall Knoxville, TN and parking deck 50% 9/98
Windsor Park
Mall San Antonio, TX Theatre expansion 100% 8/99
(1) Total anticipated cost of the above projects is $138 million; SDG's
share is $131 million.
<PAGE>
SIMON DeBARTOLO GROUP
Capital Expenditures
For the Six Months Ended June 30, 1998
(In millions)
Joint Venture Properties
-----------------------
Consolidated SDG's
Properties Total Share
---------- ----- -----
New Developments $28.9 $21.8 $11.5
Renovations and Expansions 80.3 35.0 13.4
Tenant Allowances-Retail 15.6 4.9 2.1
Tenant Allowances-Office 1.1 - -
Capital Expenditures
Recoverable from Tenants 4.2 0.4 0.2
Other (1) 3.1 0.6 -
------ ------ ------
Totals $133.2 $62.7 $27.2
====== ====== ======
(1) Primarily represents capital expenditures not recovered from
tenants.
<PAGE>
SIMON DeBARTOLO GROUP
Gains on Sales of Peripheral Land
For the Six Months Ended June 30, 1998 and 1997
(In millions)
Six Months Ended
June 30,
1998 1997
---- ----
Consolidated Properties $0.9 $2.6
SDG's Share of Joint Venture
Properties 0.4 1.5
---- ----
Totals $1.3 $4.1
==== ====
<PAGE>
Simon DeBartolo Group
Teleconference Call Text
August 11, 1998
Welcome and Opening Comments (David Simon)
- -------------------------------------------
Good afternoon and welcome to our second quarter earnings
teleconference. We are pleased to report another solid quarter of
growth, highlighted by the following:
* We increased FFO per share in the 2nd quarter by 11.9%. Our year-
to-date FFO growth was 13.2%, one of the highest rates in the regional
mall sector.
* We announced our expansion into Europe.
* We completed the private placement of $1.075 billion of senior
unsecured debt securities at a weighted average interest rate of 6.8%,
which looks to be very well timed given the corporate spreads over the
last month.
* SBV, our strategic marketing division, formed alliances with Visa
U.S.A. and the NFL to promote "Kickoff 98" and DMX Inc. to deliver
bundled music and communications services to Simon malls.
* In July, we announced that we will be changing our corporate name
back to Simon Property Group.
* All the fundamentals that have fueled our growth continue to be in
place, and we are very excited about the prospects for the balance of
this year and into 1999.
The CPI Merger (David Simon)
- ----------------------------
We have been working diligently toward the completion of the CPI
transaction:
* On July 31, we closed on the sale of the GM Building to Donald
Trump and Conseco, Inc. for net proceeds of $800 million. This figure
was slightly above our budgeted proceeds and we are very pleased to have
completed the transaction.
* The private placement of our senior unsecured debt securities
reduced our $1.25 billion revolver to nearly $0. This puts us in a
terrific financial position to complete the CPI transaction.
* We expect the SEC to declare our registration statement effective
within the next few days.
* Proxy materials will be mailed to shareholders a few days
thereafter.
* We plan to conduct the shareholders' meeting and complete the
merger before the end of September.
CPI's second quarter performance was strong with continued increases in
occupancy and sales. The CPI portfolio remains on track for an
anticipated 11% increase in EBITDA for 1998.
<PAGE>
We continue to have some discussions with the analytic community about
the potential stock overhang from certain CPI shareholders. Our
situation is totally different than others in the marketplace. We do
not believe that this should be a concern for the following reasons:
1. CPI has had a long-standing stock buy-back program whereby
shareholders can sell their stock to the company or other shareholders
if they so desire.
2. CPI shareholders will receive 50% of the merger consideration in
cash, thereby liquifying their position substantially at the time of
closing.
3. During the bidding process, we inquired of the CPI Board of
Directors whether the shareholders desired a higher component of cash
versus stock. We were told that the shareholders wanted at least 50% in
the form of stock - they want to remain invested in the sector and in
our company in particular.
4. The three largest shareholders of CPI collectively own 65% of the
Company, all are represented on the CPI Board and all voted in favor of
the merger. We expect that these three shareholders will continue
their investment in Simon, and two of these shareholders will be
represented on the combined Simon post-merger Board.
Having had significant discussions with CPI shareholders over the past
several months, they are very much interested in seeing the company
continue to prosper and grow, and we expect them to be very supportive
of our efforts as we go forward.
Upon completion of the merger, the Company will have a total market cap
of $17 billion and a portfolio containing 241 properties comprising 165
million square feet of GLA, which includes nearly 25% of the country's
best malls. The Company's dominance in markets such as New York,
Atlanta, Pittsburgh, Indianapolis, and Southeast Florida and its
presence in major markets such as Boston, Los Angeles, Dallas, Orlando,
Chicago, and Las Vegas-just to name a few-will provide an unprecedented
foundation upon which to continue the growth of our Company. Given the
strong fundamentals that exist in our base business as well as what is
going on within the CPI portfolio, we have no regret regarding our
decision to acquire CPI. We look forward to the merger completion. All
of the financing has been lined up and there is no need for us to issue
additional equity to complete the CPI transaction or to execute our
business plan. We remain very bullish on the transaction, which we
believe will create the dominant retail real estate company in the
world.
<PAGE>
Financial and Operational Results (Steve Sterrett)
- ---------------------------------------------------
Our financial and operational results for the quarter and six months
ended June 30, 1998 are as follows:
For the quarter.
* FFO on a per share basis increased 11.9% to $0.66 per share in 1998
from $0.59 per share in 1997, under both the basic and diluted methods.
* FFO of the Operating Partnership was $116.0 million, an increase of
24.3% or $22.7 million over the same period in 1997.
* Total revenue increased 26.6% to $310.4 million as compared to
$245.1 million over the same period in 1997.
Results for the quarter do include the adoption of Emerging Issues Task
Force 98-9, as of May 22, 1998, regarding the recording of percentage
rents. The impact is not material to our results for the second
quarter, less than a penny per share. However, we do want to advise
that we expect the impact on the third quarter to be approximately 3
cents per share. We expect 2 cents of this to be recovered during the
fourth quarter, resulting in a net impact of approximately 1 cent per
share for 1998, which will be recovered in the first quarter of 1999.
For the six months.
* Fully diluted FFO per share increased 13.2% to $1.29 per share in
1998 from $1.14 per share in 1997.
* FFO of the Operating Partnership was $224.9 million, an increase of
24.1% or $43.7 million over the same period in 1997.
* Total revenue for the six months increased 25.3% to $610.6 million
as compared to $487.5 million in 1997.
The strength and overall health of our portfolio in terms of sales
performance and increases in minimum rent and occupancy have contributed
to our growth in FFO:
* Occupancy at June 30, 1998, was 87.0%, an increase of 180 basis
points over the same period in 1997.
* Average base rent in the regional mall portfolio was $23.10 per
square foot as compared to $20.94 one year ago, for an increase of
10.3%. The increase for "comparable properties", those that were owned
over both of the reporting periods, was 7.2%, to $22.45 per square foot.
* The average initial base rent for new leases signed in 1998 was
$24.97 per square foot, an increase of $5.45, or about 28% over the
tenants who closed or whose leases expired.
<PAGE>
* Total sales volume in the portfolio for the first half of the year
was $4.2 billion at June 30, up 44.7% from $2.9 billion in 1997.
* Total sales per square foot increased 8.5%, to $318. The increase
for "comparable properties," that is properties owned for at least one
year, was 5.8%.
* Comparable sales per square foot for tenants who have been in place
for at least 24 months, increased 8.6%, to $328.
Same property NOI growth for the six months as compared to last year was
7.2%.
We are very pleased with the results for the first six months. The year-
over-year comparisons illustrate the positive impact of our acquisition
activity, yet the "comparable" portfolio statistics also show strong
increases in the existing portfolio. Our ability to aggressively manage
our existing portfolio provides the foundation upon which to integrate
new assets.
Financing Activities (Steve Sterrett)
- --------------------------------------
In June, we completed the private placement of $1.075 billion of senior
unsecured debt securities. The issue included three tranches of senior
unsecured notes totaling $875 million and $200 million of 7.00%
Mandatory Par Put Remarketed Securities ("MOPPRS"). We were very
pleased with the pricing on this debt offering, which was at a weighted
average interest rate of 6.8%. We were able to complete this offering
in a very choppy bond market. This again demonstrates the financial
strength of our company.
Earlier in June, we were removed from credit watch by both Standard &
Poors and Moody's, and our senior unsecured ratings were upgraded to
BBB+ by Standard & Poors and reaffirmed at Baa1 by Moody's. As you may
have read, we opted not to renew our ratings contract with Fitch, as the
alignment of S&P and Moody's ratings in strong BBB category eliminated
the need, in our opinion, of a third agency's rating.
Development Activities (Rick Sokolov)
- --------------------------------------
During the second quarter, we opened the first phase of Lakeline Plaza
in Austin, Texas, a 239,000 square foot power center. Phase II, which
totals 128,000 square feet, will open in 1999. This center complements
Lakeline Mall, which we opened in October 1995.
<PAGE>
We are looking forward to the opening of The Shops at Sunset Place, a
510,000 square foot specialty center located in South Miami, Florida.
This center has an exciting mixture of restaurants, entertainment
tenants and retailers that are making a real impact on our industry
today. The opening for this center is scheduled for December. We are
over 93% leased and committed on this $150 million project.
We currently have three additional projects under construction or in the
final stages of predevelopment as discussed in this morning's release:
* Concord Mills is under construction in Concord (Charlotte), North
Carolina, through our joint venture agreement with the Mills.
* Houston Premium Outlets in Houston, Texas, will start construction
later this month for an opening approximately 13 months from now. This
project is a joint venture with Chelsea GCA.
* And our third new development is The Shops at North East Plaza, a
320,000 square foot power center adjacent to our North East Mall, that
will begin construction this fall for a fall 1999 opening.
We continue to evaluate and work on new development opportunities in
Orlando, Philadelphia, Dallas and metropolitan Washington DC.
We have three significant redevelopments that will be completed this
year: Castleton Square, Prien Lake Mall and Richmond Town Square.
These projects are detailed in today's press release.
In addition, there are three other major redevelopments that will open
after 1998.
* The Florida Mall in Orlando will add a new 200,000 square foot
Burdines and 190,000 square feet of small shops. JCPenney, Dillard's,
and Saks will also expand. Parisian has just acquired the Gayfer's
store there and will expand that location by 80,000 feet. This project
will be completed in November of 1999.
* Mission Viejo Mall in Mission Viejo, California, will add Nordstrom
and Saks, expand Macy's and Robinson-May, and add 150,000 square feet of
small shops. This redevelopment has a targeted completion of September
1999, whereby we intend to capture new significant market share and
reposition Mission Viejo as an upscale shopping destination.
* North East Mall in Hurst, Texas, will complete its redevelopment in
the year 2000. This complete mall renovation includes the addition of
Nordstrom and Saks; a reconfigured and new Dillard's; the expansion of
JCPenney; and the addition of small shop GLA with a new food court.
<PAGE>
Our redevelopment program is continuing in full force with more than 18
projects currently under construction, (in addition to the significant
projects discussed above), including 10 mall remodels and the addition
of over 18 anchors in our portfolio in 1998. Simon's investment, or
share of costs, for these projects is approximately $139 million.
Acquisition/Disposition Activity (Rick Sokolov)
- -----------------------------------------------
Subsequent to the first quarter, we acquired an additional ownership
interest in Lakeline Mall and Lakeline Plaza in Austin, Texas, and we
now own 80% of each of these assets.
Effective May 5th, we acquired the remaining 50.1% interest in Rolling
Oaks Mall in San Antonio, Texas, for SDG Common Stock. We now own 100%
of this 759,000 square foot mall anchored by Dillard's, Foley's and
Sears.
As part of our program to identify and dispose of assets which do not
fit the Company's long-term strategic criteria, we sold two assets in
June for an aggregate of $37 million: The Promenade located in Woodland
Hills, California and Southtown Mall in Ft. Wayne, Indiana.
We are continuing with our plans to dispose of our remaining office
assets and a selected number of non-core regional mall assets that do
not fit our growth profile going forward.
International Expansion (David Simon)
- --------------------------------------
In June, we were very excited to announce our intention to expand into
continental Europe. In an agreement with Harvard Private Capital Group
and Argo II, an investment fund established by J.P. Morgan and The
O'Connor Group, we collectively committed to acquire an initial 44
percent ownership position in Groupe BEG, S.A., a fully integrated
retail real estate developer, lessor and manager headquartered in Paris,
France. We will be able to parlay BEG's existing business relationships
and in-depth market knowledge into our overseas ventures, which will
include the development, ownership and management of retail properties
in key European markets; currently targeting significant efforts in
Poland. In addition, Simon's entry into Europe enhances our
opportunities to provide U.S.-based retailers with international
locations. We are very excited about the opportunities that this
combination presents to us in the future.
<PAGE>
Company Name Change (David Simon)
- ---------------------------------
Recently, we announced that our name will be changing back to Simon
Property Group, effective with the closing of the CPI merger. This name
change is appropriate for several reasons:
1. The combination of the Simon and DeBartolo names created confusion
in the business community-there was no clear company identity-and given
that our ticker symbol maintained at "SPG", we felt it was in the best
interest of our company to go back to Simon Property Group.
2. We have been evaluating extensively the roll out of a "branding"
strategy for Simon Property Group, and our market research indicated
that both shoppers and tenants, our two major constituencies, will more
clearly identify with a simple brand name such as "Simon".
3. Our recent acquisition activity, i.e. RPT and CPI, have signaled to
the market a new strategic direction for the Company and I think the
name change clearly reinforces that transformation of our company.
Conclusion (David Simon)
- -------------------------
* We are very pleased with our year-to-date results.
* Business fundamentals are very strong-we have seen terrific trends
in occupancy, sales and rental growth.
* We look forward to the remainder of 1998.
* We believe the CPI transaction is a terrific opportunity for our
company.
|
|