WESTFIELD AMERICA INC, 424B1, 1997-05-19

WESTFIELD AMERICA INC
424B1, 1997-05-19
OPERATORS OF NONRESIDENTIAL BUILDINGS

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FILED PURSUANT TO RULE 424(B)(1)
REGISTRATION NO. 333-22731
PROSPECTUS

[LOGO]
18,000,000 SHARES

WESTFIELD AMERICA, INC.
COMMON STOCK
---------------------------
Westfield America, Inc. (formerly known as CenterMark Properties, Inc.) (the
"Company"), a Missouri corporation incorporated in 1924, is
engaged in owning, operating, leasing, developing, redeveloping and acquiring
super regional and regional shopping centers and power centers located primarily
in major metropolitan areas in the United States. The Company's portfolio
consists of interests in 13 super regional and six regional shopping centers and
three power centers containing approximately 19.2 million square feet of gross
leasable area (together, the "Centers") and 13 separate department store
properties. The Company has engaged subsidiaries of Westfield Holdings Limited
(individually, "Westfield Holdings Limited" and collectively with its
subsidiaries, "Westfield Holdings"), an Australian public corporation and a
principal shareholder in the Company, to provide advisory, management and
development services to the Company and the Centers. The Company will use $145
million of the proceeds of the Offerings (as defined below) to make a
non-recourse loan to Westfield Holdings secured by its indirect 50% interest in
Garden State Plaza, a super regional shopping center, and $15.3 million to
purchase from Westfield Holdings Limited warrants (the "Westfield Holdings
Warrants") to acquire 9.8 million ordinary shares of Westfield Holdings Limited.
Westfield Holdings Limited is an independent company from the Company and,
except for the Company's interest in the Westfield Holdings Warrants, the
purchasers of the Shares will not acquire any interest in Westfield Holdings
Limited. The Company is organized and operated as a real estate investment trust
("REIT") and expects to continue to be operated as a REIT for Federal income tax
purposes. The Company intends to continue to pay regular quarterly
distributions.
All of the shares (the "Shares") of common stock, par value $.01 per share
(the "Common Stock"), of the Company offered hereby are being sold by the
Company. Of the 18,000,000 Shares being offered, 15,300,000 Shares are being
offered initially in the United States and Canada by the U.S. Underwriters (the
"U.S. Offering") and the remaining 2,700,000 Shares are being offered initially
outside the United States and Canada by the International Managers (the
"International Offering" and, together with the U.S. Offering, the "Offerings").
Westfield Holdings, interests associated with the Lowy family and a Co-President
of the Company have placed orders to purchase up to 2,300,000; 600,000; and
100,000 of the Shares, respectively (the "Orders"), at the price to public in
the Offerings. The Common Stock has been approved for listing on the New York
Stock Exchange, subject to official notice of issuance, under the symbol "WEA."
Prior to the Offerings, there has been no public market for the Common Stock.
See "Underwriting" for a discussion of the factors considered in determining the
initial public offering price. The Company's articles of incorporation impose
limitations, subject to certain limited exceptions, on the number of shares of
capital stock that may be directly or indirectly owned by any person or
affiliated group. See "Description of Capital Stock--Restrictions on Ownership
and Transfer."
Upon consummation of the Offerings and concurrent transactions and taking
account of the maximum number of Shares which may be acquired under the Orders,
Westfield America Trust, an Australian public property trust ("WAT"), will own
62.4% and Westfield Holdings will own 16.7% (31.7% including its indirect
interest through WAT), of the outstanding Common Stock on a fully-diluted basis.
The Shares offered hereby represent approximately 22.7% of all shares of Common
Stock (including up to 3.8% which may be acquired under the Orders) that will be
issued and outstanding after the Offerings and concurrent transactions on a
fully-diluted basis.
SEE "RISK FACTORS" BEGINNING ON PAGE 21 FOR CERTAIN FACTORS RELEVANT TO AN
INVESTMENT IN THE COMMON STOCK, INCLUDING:
- POSSIBLE CONFLICTS OF INTEREST AMONG WESTFIELD HOLDINGS, THE LOWY FAMILY,
WAT AND THE OTHER SHAREHOLDERS OF THE COMPANY.
- RELIANCE BY THE COMPANY ON WESTFIELD HOLDINGS FOR ADVISORY, MANAGEMENT AND
DEVELOPMENT SERVICES SUCH THAT THE COMPANY IS NOT CURRENTLY ABLE TO
OPERATE WITHOUT WESTFIELD HOLDINGS.
- THE ABILITY OF WESTFIELD HOLDINGS, THE LOWY FAMILY AND WAT TO EXERCISE
SIGNIFICANT INFLUENCE OVER THE BUSINESS AND POLICIES OF THE COMPANY.
- LIMITATIONS ON THE SHAREHOLDERS' ABILITY TO CHANGE CONTROL OF THE COMPANY
DUE TO SIGNIFICANT OWNERSHIP BY WESTFIELD HOLDINGS AND WAT AND DUE TO
RESTRICTIONS ON OWNERSHIP OF MORE THAN 5.5% OF THE SHARES OF CAPITAL STOCK
BY OTHER SHAREHOLDERS.
- RISKS GENERALLY INHERENT IN RETAIL REAL ESTATE INVESTMENTS, SUCH AS RISKS
FROM CHANGES IN ECONOMIC CONDITIONS, REDEVELOPMENT RISK, COMPETITION FROM
OTHER SHOPPING CENTERS AND OTHER FORMS OF RETAILING AND FINANCIAL
DIFFICULTIES OR BANKRUPTCIES OF TENANTS OR ANCHORS.
- RISKS NORMALLY ASSOCIATED WITH DEBT FINANCING, INCLUDING POSSIBLE
INABILITY TO REFINANCE BALLOON PAYMENTS AND THE RISK OF HIGHER INTEREST
RATES.
- TAXATION OF THE COMPANY AS A REGULAR CORPORATION AND RESULTING ADVERSE
CONSEQUENCES IF IT FAILS TO CONTINUE TO QUALIFY AS A REIT.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

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<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNT(1)(2) COMPANY(2)(3)
<S> <C> <C> <C>
Per Share..................................... $15.00 $1.05 $13.95
Total (4)..................................... $270,000,000 $17,490,000 $252,510,000
</TABLE>

(1) The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."
(2) The U.S. Underwriters and the International Managers will only receive the
selling concession portion of the underwriting discount ($.58 per Share) on
the Orders.
(3) Before deducting estimated expenses of $7,750,000 payable by the Company.
(4) The Company has granted to the U.S. Underwriters and the International
Managers options, exercisable for a period of 30 days after the date of the
Prospectus, to purchase up to an aggregate of 2,295,000 and 405,000
additional shares of Common Stock, respectively, solely to cover
over-allotments. If all such shares of Common Stock are purchased, the total
Price to Public, Underwriting Discount and Proceeds to Company will be
$310,500,000, $20,325,000 and $290,175,000, respectively. See
"Underwriting."
------------------------
The Shares are offered by the several Underwriters, subject to prior sale,
when, as and if delivered to and accepted by the Underwriters, and subject to
their right to withdraw, modify, cancel and reject orders in whole or in part.
It is expected that delivery of the Shares offered hereby will be made in New
York City on or about May 21, 1997.
---------------------------
MERRILL LYNCH & CO.
FURMAN SELZ
GOLDMAN, SACHS & CO.
MORGANSTANLEY & CO.
INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SMITH BARNEY INC.
--------------

The date of this Prospectus is May 15, 1997.
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Map showing the locations of Westfield America, Inc.'s shopping centers
throughout the United States and identifying the redevelopment projects over a
five-year period; photograph of Montgomery Mall; aerial photographs of Annapolis
Mall, Topanga Plaza, Trumbull Shopping Park, West County Center, Meriden Square,
Mission Valley Center, Plaza Bonita, Mid Rivers Mall, The Plaza at West Covina;
interior photographs of Montgomery Mall, Plaza Camino Real, Vancouver Mall,
Plaza Bonita, Annapolis Mall and Connecticut Post Mall.

Certain persons participating in these offerings may engage in transactions that
stabilize, maintain, or otherwise affect the price of the shares of Common
Stock. Such transactions may include stabilizing the purchase of Common Stock to
cover syndicate short positions and the imposition of penalty bids. For a
description of these activities, see "Underwriting."

Certain information relating to Westfield Holdings Limited, Westfield Trust
(as defined in the Glossary) and WAT has been included in this Prospectus. Each
such entity reports its financial results, and its securities trade on the
Australian Stock Exchange, in Australian currency. As used herein, references to
"$," "U.S.$" and "U.S. dollars" are references to U.S. currency and references
to "Aus.$" and "Australian dollars" are references to Australian currency. For
the convenience of the reader, the calculation of the purchase price for the
Westfield Holdings Warrants has been converted from Australian dollars to U.S.
dollars based on an exchange rate of $0.78 to Aus.$1.00 (the rate as of May 15,
1997).
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TABLE OF CONTENTS

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PAGE
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Prospectus Summary....................................................................................... 1
The Company............................................................................................ 1
Westfield Holdings..................................................................................... 2
Westfield America Trust................................................................................ 4
Risk Factors........................................................................................... 5
Business and Properties................................................................................ 6
The Centers.......................................................................................... 6
The Company's Strategy for Operations and Growth..................................................... 11
Company Structure and History.......................................................................... 13
Financing Policies..................................................................................... 15
Federal Income Tax Considerations and Tax Status of the Company........................................ 15
The Offerings.......................................................................................... 16
Distributions.......................................................................................... 16
Summary Financial Data................................................................................. 18
Risk Factors............................................................................................. 21
Possible Conflicts of Interests with Inside Parties and Related Party Transactions..................... 21
Limitations on Acquisitions and Change in Control...................................................... 23
Risks Generally Inherent in Real Estate Investment..................................................... 23
Risks Associated with Debt Financing................................................................... 27
Adverse Consequences of Failure to Qualify as a REIT................................................... 29
Possible Taxation on Capital Gains..................................................................... 30
Distributions to Shareholders; Potential Requirement to Borrow......................................... 30
Conflicts of Interest with Outside Partners in Jointly-Owned Centers and Limited Control with Respect
to Certain Activities................................................................................ 32
Bankruptcy of Outside Partners......................................................................... 33
Effect of Uninsured Loss on Profitability.............................................................. 33
Possible Environmental Liabilities..................................................................... 34
Lack of Independent Valuation of the Company........................................................... 34
Absence of Public Market; Possible Volatility of Stock Price........................................... 35
Possible Adverse Effects on Stock Prices Arising from Shares Available for Future Sale................. 35
Changes in Policy Without Shareholder Approval......................................................... 36
Forward-Looking Statements............................................................................. 36
Immediate Dilution..................................................................................... 36
The Company.............................................................................................. 37
General................................................................................................ 37
Company Structure and History.......................................................................... 38
Westfield Holdings..................................................................................... 39
The Company's Strategy for Operations and Growth....................................................... 41
Use of Proceeds.......................................................................................... 47
Capitalization........................................................................................... 48
Dilution................................................................................................. 49
Distributions............................................................................................ 50
Selected Financial Data.................................................................................. 51
Management's Discussion and Analysis of Financial Condition and Results of Operations.................... 54
General Background..................................................................................... 54
Results of Operations.................................................................................. 55
Cash Flows............................................................................................. 58
Funds from Operations.................................................................................. 59
Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends.............................. 60
Portfolio Data......................................................................................... 61
</TABLE>

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PAGE
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Leasing................................................................................................ 61
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Tenant Occupancy Costs................................................................................. 62
Liquidity and Capital Resources........................................................................ 62
Inflation.............................................................................................. 64
Seasonality............................................................................................ 65
Business and Properties.................................................................................. 65
General................................................................................................ 65
The Shopping Center Business........................................................................... 65
The Centers............................................................................................ 66
The East Coast Properties.............................................................................. 71
The Mid West Properties................................................................................ 72
The West Coast Properties.............................................................................. 73
Anchors................................................................................................ 76
Mall Stores............................................................................................ 77
Sales.................................................................................................. 78
Leasing................................................................................................ 79
Costs of Occupancy..................................................................................... 79
Leases................................................................................................. 79
Lease Expirations...................................................................................... 80
Mall Store Rental Rates................................................................................ 80
Competition............................................................................................ 81
Certain Tax Information................................................................................ 82
Additional Information Regarding Connecticut Post Mall, Montgomery Mall, The Plaza at West Covina,
South Shore Mall and Trumbull Shopping Park.......................................................... 82
Additional Information Regarding Annapolis Mall........................................................ 88
Additional Information Regarding Garden State Plaza.................................................... 90
Additional Information Regarding Wheaton Plaza......................................................... 92
May Properties......................................................................................... 94
Other Real Estate Interests............................................................................ 95
Insurance Arrangements................................................................................. 95
Employees.............................................................................................. 95
Debt Summary........................................................................................... 95
Environmental Matters.................................................................................. 97
Legal Proceedings...................................................................................... 98
Policies and Objectives with Respect to Investments, Financing and Other Activities...................... 99
Investment Objectives and Policies..................................................................... 99
Real Estate Investment Policies and Criteria........................................................... 99
Acquiring Additional Properties........................................................................ 99
Dispositions........................................................................................... 100
Partnership Restructuring.............................................................................. 100
Other Investments...................................................................................... 100
Financing.............................................................................................. 101
Equity Capital......................................................................................... 102
Working Capital Reserves............................................................................... 102
Annual Reports......................................................................................... 103
Other Policies......................................................................................... 103
Management............................................................................................... 104
Directors and Executive Officers....................................................................... 104
Biographies of Directors and Executive Officers........................................................ 104
Certain Information Regarding the Board of Directors................................................... 107
Committees of the Board of Directors................................................................... 107
Compensation of Directors.............................................................................. 108
</TABLE>

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<TABLE>
<CAPTION>
PAGE
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Executive Compensation................................................................................. 108
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Advisory, Management and Development Services to the Company............................................. 109
The Advisor and the Advisory Agreement................................................................. 109
The Manager and the Management Agreements.............................................................. 110
The Developer and the Development Agreement............................................................ 111
Westfield Holdings Management.......................................................................... 112
Certain Transactions..................................................................................... 112
Relationships and Transactions with Westfield Holdings................................................. 112
Relationships and Transactions with WAT................................................................ 115
Principal Shareholders................................................................................... 117
Description of Capital Stock............................................................................. 120
Capital Stock.......................................................................................... 120
Senior Preferred Shares................................................................................ 120
Preferred Stock........................................................................................ 120
Common Shares.......................................................................................... 122
Restrictions on Ownership and Transfer................................................................. 123
Transfer Agent and Registrar........................................................................... 124
Listing................................................................................................ 124
Certain Provisions of the Company's Articles of Incorporation and By-Laws and of
Missouri Law........................................................................................... 124
Ownership Limit........................................................................................ 125
Additional Classes and Series of Preferred Stock....................................................... 125
Size of Board, Election of Directors, Classified Board, Removal of Directors and
Filling Vacancies.................................................................................... 125
Limitations on Shareholder Action by Written Consent; Ability to Call Special Meetings................. 125
Advance Notice for Raising Business or Making Nominations at Meetings.................................. 126
Business Combination and Control Share Acquisition Statutes and Related Provisions..................... 126
Termination of REIT Status............................................................................. 128
Limitation on Liability of Directors; Indemnification of Directors and Officers........................ 128
Shares Available for Future Sale......................................................................... 129
General................................................................................................ 129
Registration Rights.................................................................................... 130
Federal Income Tax Considerations........................................................................ 131
Taxation of the Company................................................................................ 131
Tax Aspects of the Company's Investments in Partnerships............................................... 137
Taxation of Taxable Domestic Shareholders.............................................................. 139
Taxation of Tax-Exempt Shareholders.................................................................... 139
Taxation of Foreign Shareholders....................................................................... 139
Information Reporting and Backup Withholding........................................................... 141
Other Tax Consequences................................................................................. 142
ERISA Considerations..................................................................................... 143
Underwriting............................................................................................. 144
Experts.................................................................................................. 148
Legal Matters............................................................................................ 148
Additional Information................................................................................... 148
Glossary................................................................................................. G-1
Index to Financial Statements............................................................................ F-1
</TABLE>

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PROSPECTUS SUMMARY

THIS SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED INFORMATION
AND FINANCIAL DATA AND STATEMENTS AND THE NOTES THERETO APPEARING ELSEWHERE IN
THIS PROSPECTUS. UNLESS OTHERWISE INDICATED, THE INFORMATION CONTAINED IN THIS
PROSPECTUS ASSUMES THAT THE U.S. UNDERWRITERS' AND THE INTERNATIONAL MANAGERS'
OVER-ALLOTMENT OPTIONS ARE NOT EXERCISED. AS USED IN THIS PROSPECTUS, "REGIONAL
SHOPPING CENTERS" MEANS MALL FACILITIES BUILT AROUND ONE OR TWO ANCHORS AND
CONTAINING FROM 400,000 TO 800,000 SQUARE FEET OF TOTAL GROSS LEASABLE AREA. THE
TERM "SUPER REGIONAL SHOPPING CENTERS" MEANS MALL FACILITIES BUILT AROUND THREE
OR MORE ANCHORS AND CONTAINING MORE THAN 800,000 SQUARE FEET OF TOTAL GROSS
LEASABLE AREA. THE TERM "POWER CENTERS" REFERS TO MALL FACILITIES WHOSE MAJOR
TENANTS ARE LARGE DISCOUNT DEPARTMENT STORES OR CATEGORY KILLERS. THE TERM
"ANCHOR" MEANS THE CENTERS' (AS DEFINED BELOW) FULL LINE DEPARTMENT STORES OR
OTHER LARGE RETAIL STORES GENERALLY OCCUPYING MORE THAN 50,000 SQUARE FEET OR A
LARGE ENTERTAINMENT COMPLEX. "MALL STORES" REFERS TO STORES SMALLER THAN ANCHORS
AND KIOSKS PERMANENTLY LOCATED WITHIN THE CORRIDORS OF THE COMPANY'S CENTERS
THAT ARE TYPICALLY SPECIALTY RETAILERS AND FREE STANDING BUILDINGS GENERALLY
LOCATED ALONG THE PERIMETER OF THE COMPANY'S CENTERS. "STABILIZED CENTERS" REFER
TO THE COMPANY'S CENTERS (OTHER THAN NORTH COUNTY FAIR) NOT UNDER REDEVELOPMENT
FOR THE RELEVANT PERIOD. UNLESS OTHERWISE INDICATED, OR UNLESS THE CONTEXT
OTHERWISE REQUIRES, REFERENCES TO THE "COMPANY" INCLUDE WESTFIELD AMERICA, INC.,
ITS SUBSIDIARIES AND JOINT VENTURE INTERESTS. SEE "GLOSSARY" FOR DEFINITIONS OF
CERTAIN TERMS USED IN THIS PROSPECTUS.

THE COMPANY

The Company has been engaged for over 40 years in owning, operating,
leasing, developing, redeveloping and acquiring super regional and regional
shopping centers and power centers located primarily in major metropolitan areas
in the United States.The Company owns interests in a portfolio of 13 super
regional and six regional shopping centers (together, the "Regional Centers"),
three power centers (the "Power Centers" and, collectively with the Regional
Centers, the "Centers"), 13 separate department store properties (the "May
Properties") which are net leased under financing leases to The May Department
Stores Company (the "May Company") and are not located at the Centers, and
certain other real estate investments (collectively, the "Properties"). The
Centers are located in seven states in the United States. The Company is
organized and operated as a REIT and expects to continue to be operated as a
REIT for Federal income tax purposes.

The Centers contain approximately 19.2 million square feet of total gross
leasable area ("Total GLA"), including 74 Anchors and approximately 2,500 Mall
Stores, of which approximately 1.3 million square feet are currently under
redevelopment and approximately 3.2 million square feet are planned for
redevelopment over the next five years. For the year ended December 31, 1996,
the Mall Stores reported sales exceeding $1.5 billion and Anchors reported sales
exceeding $2.0 billion. The Centers under Westfield Holdings's management
(representing all of the Centers other than North County Fair) reported average
Mall Store sales of $297 per square foot ("psf") for the same period (and,
including North County Fair, $300 psf for the same period). Mall gross leasable
area ("Mall GLA") at Stabilized Centers was 92% leased (and, including North
County Fair, 91% leased) as of December 31, 1996.

Since 1994, subsidiaries of Westfield Holdings Limited have provided
management, development and advisory services to the Company. The Company has no
employees and relies solely on Westfield Holdings for management services.
Subject to the discretion and approval of the Board of Directors of the Company,
the Company's strategic policy will be determined by Westfield Holdings and
possible conflicts of interest may exist between the Company, Westfield Holdings
and, by virtue of its ability to significantly influence Westfield Holdings
Limited, the Lowy family. In addition, as a result of Westfield Holdings's
ownership interest in the Company and its management of WAT, the purchasers of
the Shares may not be able to change the composition of the management of the
Company through a vote of shareholders. See "Risk Factors--Possible Conflicts of
Interest and Related Party Transactions" for a discussion of possible conflicts.

The Company has an option (the "Garden State Plaza Option") to acquire at
fair market value the stock of Westland Realty, Inc., the holder of an indirect
50% interest in Garden State Plaza located in

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Paramus, New Jersey. Garden State Plaza is one of the largest and most
productive super regional shopping centers in the nation, with five anchors and
containing approximately 2.0 million square feet of total gross leasable area
and average mall store sales psf of $467 for the year ended December 31, 1996.
The Garden State Plaza Option is exercisable following the completion of an
independent valuation of the property to determine its fair market value. The
valuation procedure may be commenced by the Company upon the satisfaction of
certain conditions, but in any event no later than January 3, 2000. The exercise
of the Garden State Plaza Option will require the approval of at least 75% of
the Independent Directors and, if the purchase price (which is payable in Common
Stock) will exceed $55 million (net of the $145 million Garden State Plaza Loan
described below), the approval of a majority of the holders of the Common Stock
voting at a meeting on such issue other than Westfield Holdings and its
affiliates (including, without limitation, WAT) and interests associated with
the Lowy family. Although the Garden State Plaza Option is not currently
exercisable, the Company will acquire a substantial economic interest in the
revenues to be received from Garden State Plaza by making a $145 million
participating secured loan (the "Garden State Plaza Loan") to the subsidiaries
of Westfield Holdings Limited which own the indirect 50% interest in Garden
State Plaza. For more detailed descriptions of the Garden State Plaza Option and
the Garden State Plaza Loan, see "The Company--The Company's Strategy for
Operations and Growth--Garden State Plaza Option" and "Certain
Transactions--Relationships and Transactions with Westfield Holdings--Garden
State Plaza Option."

The Company has achieved substantial growth since 1994 when Westfield
Holdings began advising the Company and providing management services to its
Centers. For the Mall Stores under Westfield Holdings management, from 1994 to
1996, average base rent per square foot at the Centers increased at a compound
annual rate of approximately 4.5% (4.2%, including North County Fair), sales per
square foot increased at a compound annual rate of 6.3% (6.2%, including North
County Fair) and leased Mall GLA at Stabilized Centers improved from 88% leased
to 92% leased (from 88% leased to 91% leased, including North County Fair).

Following consummation of the Offerings, the Board of Directors of the
Company (the "Board of Directors") will have 10 directors, 6 of whom will be
Independent Directors.

The principal executive offices of the Company are located at 11601 Wilshire
Boulevard, Los Angeles, California 90025 (telephone: 310-478-4456). The
headquarters of the Company's manager (the "Manager"), advisor (the "Advisor")
and developer (the "Developer") are located at the same address in Los Angeles,
California.

WESTFIELD HOLDINGS

Westfield Holdings is a fully-integrated, international developer, builder
and manager of shopping centers and manager and advisor to public real estate
investment entities. Westfield Holdings has its headquarters in Sydney,
Australia and employed approximately 2,400 people worldwide as of December 31,
1996. Westfield Holdings, which was publicly listed in 1960, was co-founded by
Frank P. Lowy. In 1993, Frank P. Lowy was acknowledged as one of the six
"pioneers" of the shopping center industry worldwide by the International
Council of Shopping Centers ("ICSC"). By combining financial strength and over
35 years of experience with a business philosophy that stresses innovation,
Westfield Holdings has built a successful shopping center business, with
shopping center assets under management having a value in excess of Aus.$10.0
billion as of December 31, 1996, comprised of more than 8,500 retail stores in
56 centers in the United States, Australia and Asia with 39.3 million square
feet of total gross leasable area.

Westfield Holdings Limited, listed on the Australian Stock Exchange Limited
(the "ASX"), had a market capitalization of approximately Aus.$2.5 billion as of
May 9, 1997. Westfield Holdings is also a manager and advisor to public real
estate investment entities--Westfield Trust and WAT, both of which are
Australian public property trusts traded on the ASX. Based on its market
capitalization of approximately Aus.$3.1 billion as of May 9, 1997, Westfield
Trust is one of the two largest property trusts in Australia.

Since 1977, Westfield Holdings's U.S. business has included the
redevelopment and expansion of 11 shopping centers in California, Connecticut,
Michigan, Missouri, New Jersey and New York. Westfield

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Holdings's U.S. business currently manages and provides development services to
26 shopping centers (two of which are owned by subsidiaries of The Prudential
Insurance Company of America ("Prudential"), one of which is owned by a real
estate investment fund managed by Heitman/JMB Advisory Corporation and one of
which is owned by a real estate investment fund managed by Goldman, Sachs & Co.)
with more than 24.5 million square feet of total gross leasable area, including
the Centers and Garden State Plaza. Westfield Holdings also manages the retail
facilities at Dulles and National Airports in Washington, D.C. and Terminal C at
Logan Airport in Boston, Massachusetts. Westfield Holdings's U.S. operations are
headquartered in Los Angeles, California, and employ approximately 950 people in
the United States. Westfield Holdings's U.S. senior management team has
extensive experience in the development, construction, management and financing
of super regional and regional shopping centers, with an average of
approximately 20 years in the industry. Westfield Holdings derived approximately
41% of its U.S. management, development and advisory fee revenue from the
Company in 1996. Westfield Holdings has advised the Company that it expects the
amount of its U.S. business attributable to the Company to substantially
increase upon completion of the redevelopment of Garden State Plaza in 1997 from
which it received substantial development revenue in 1996.

The Company has access to and relies upon the resources and depth of
management of Westfield Holdings's worldwide operations. Westfield Holdings
provides a full range of services to the Company including many which are
typically outsourced by real estate owners to third parties. These services
include strategic and day-to-day management, research, investment analysis,
acquisition and due diligence, development, construction, architectural,
marketing, asset management, capital markets, disposition of assets, legal and
accounting services. In contrast to many other shopping center companies, the
Company is not exposed to the same degree of risk of increasing costs for many
of these services because the fees payable to the Manager and the Advisor are
incentive based or fixed as a percentage of assets or revenues. For a
description of Westfield Holdings's management arrangements with the Company,
including fees payable to Westfield Holdings for its services, see "Certain
Transactions--Relationships and Transactions with Westfield Holdings" and
"Advisory, Management and Development Services to the Company."

Westfield Holdings will agree that it will not acquire any ownership
interest in shopping center properties or power centers in the United States
(excluding airport projects) for so long as it is the Advisor to the Company and
the Manager of the Centers. Each of Frank Lowy, David Lowy, Peter Lowy and
Steven Lowy will agree with the Company that he will not acquire any ownership
interest in shopping center properties or power centers in the United States for
so long as (i) Westfield Holdings is the Advisor to the Company and the Manager
of the Centers, and (ii) interests associated with the Lowy family have
significant ownership interest and significant management involvement in the
operations of Westfield Holdings Limited. In addition, Westfield Holdings has
agreed in its management and development agreements with the Company that it
will not manage or develop any shopping center in competition with a Center
owned by the Company, except in the case of the acquisition by Westfield
Holdings of an entity that does not have any ownership interest in shopping
center properties or power centers in the United States and is then managing or
developing a competitive center (in addition to other properties).

Contemporaneously with the Offerings, the Company will purchase from
Westfield Holdings Limited for an aggregate purchase price of $15.3 million
(Aus.$19.6 million) non-transferable Westfield Holdings Warrants to acquire 9.8
million ordinary shares of Westfield Holdings Limited, which would be as of the
date hereof equal to approximately 9% of the ordinary shares of Westfield
Holdings Limited outstanding after the exercise of the options. See "The
Company--Westfield Holdings." Westfield Holdings Limited is an independent
company from the Company, and except for the Company's interest in the Westfield
Holdings Warrants, the purchasers of the Shares will not acquire any interest in
Westfield Holdings Limited.

Westfield Holdings has placed an order to purchase up to 2,300,000 shares at
the price to public and will continue to own a significant stake in the Company.
The following table demonstrates the Common Stock ownership of Westfield
Holdings in the Company on a fully-diluted basis (which for purposes of this
Prospectus assumes the exercise of the warrants to acquire additional Common
Stock held by WAT as well as the exercise by certain investors of options to
acquire additional units in WAT) upon consummation of

3
<PAGE>
the Offerings and concurrent transactions and taking account of the Shares to be
acquired under the Orders (for a description of the concurrent transactions, see
"Use of Proceeds" and "Pro Forma Condensed Consolidated Financial Information").
See "Principal Shareholders."

<TABLE>
<CAPTION>
Direct ownership of the Company...................................... 16.7%

<S> <C>
Indirect ownership through direct ownership of WAT units............. 15.0%
---------

Total.............................................................. 31.7%
---------
---------
</TABLE>

Interests associated with the Lowy family have placed an order to purchase
up to 600,000 Shares at the price to public and will indirectly continue to own
a significant interest in the Company. The following table demonstrates the
indirect ownership of the Common Stock by interests associated with the Lowy
family on a fully-diluted basis upon consummation of the Offerings and
concurrent transactions and taking account of the Shares to be acquired under
the Orders.

<TABLE>
<S> <C>
Direct ownership of the Company....................................... 0.8%

Indirect ownership through direct ownership of Westfield Holdings..... 13.9%

Indirect ownership through direct ownership of WAT units.............. 4.4%
---

Total............................................................... 19.1%
---
---
</TABLE>

WESTFIELD AMERICA TRUST

4
<PAGE>
RISK FACTORS

Prospective investors should carefully consider the matters addressed under
"Risk Factors" in addition to the other information presented in this Prospectus
before making an investment decision regarding the Shares offered hereby. Each
of these matters could have adverse consequences to the Company. These risks
include:

- Possible conflicts of interest among Westfield Holdings, the Lowy family,
WAT and the other shareholders of the Company.

- Reliance by the Company on Westfield Holdings for advisory, management and
development services such that the Company is not currently able to
operate without Westfield Holdings.

- The ability of Westfield Holdings and WAT (and interests associated with
the Lowy family by virtue of their interests in such entities) to exercise
significant influence over the business and policies of the Company
through the (i) ownership by Westfield Holdings and WAT of Common Stock,
(ii) ownership by Westfield Holdings of units in WAT, (iii) management of
WAT by a subsidiary of Westfield Holdings Limited and (iv) management of
the Company by Westfield Holdings.

- Limitations on the shareholders' ability to change control of the Company
due to the significant ownership by Westfield Holdings and WAT of the
outstanding Common Stock and restrictions on ownership of more than 5.5%
of the Company's outstanding shares of capital stock and other measures.

- Risks generally inherent in retail real estate investment, such as risks
from changes in economic conditions, redevelopment risk, competition from
other shopping centers and forms of retailing, financial difficulties or
bankruptcies of tenants or anchors and the concentration of 43% of the
Total GLA in California, 18% of the Total GLA in Connecticut and 14% of
the Total GLA in Missouri.

- Risks normally associated with debt financing, the amount of which debt
financing is not restricted by the Company's organizational documents,
including the possible inability to refinance balloon payments upon
maturity and the risk of higher interest rates.

- Tax risks, including (i) if the Company fails to continue to qualify as a
REIT, taxation of the Company as a regular corporation and possible
inability to requalify as a REIT for four years, (ii) the 100% tax on net
income from transactions that constitute prohibited transactions, pursuant
to the rules relating to REITs under the Code and (iii) possible taxation
of the Company with respect to built-in gain on disposition of certain
property if such property is disposed of during a ten-year period. Cash
available for distributions could be decreased dramatically if any such
taxes become payable.

- The fact that the Company's initial distribution level is based on a
number of assumptions, any change in which could affect the Company's
ability to sustain the initial distribution level and that the Company
intends to distribute approximately 90% of its Funds from Operations.

- Limited control by the Company over certain Properties that the Company
owns in partnership with third parties, conflicts of interest with outside
partners in jointly-owned Centers and the possibility of bankruptcy of
such outside partners.

- The fact that tenants whose parent company is The Limited Stores occupy
over 10% of the Mall GLA, that department stores owned by the May Company
are Anchors at 18 of the Centers, and that a negative change in the
financial strength of The Limited Stores or the May Company could have a
material adverse effect on the Company.

- The fact that the value of the Company is not based on third-party
appraisals; therefore the aggregate market value of the Common Stock based
on its market price may exceed the fair market value of the Properties.

- Lack of a prior public market in the United States for the Common Stock as
well as potential reduction in the market price of the Shares due to
increases in interest rates or future sales of shares of Common Stock.

- Immediate dilution in the amount of $5.50 per share in the net book value
of the Common Stock acquired by purchasers in the Offerings.

5
<PAGE>
BUSINESS AND PROPERTIES

THE CENTERS

As set forth in the following table, the Company's portfolio consists of
interests in 13 super regional shopping centers, six regional shopping centers
and three power centers located in seven states in the East Coast, the Mid West
and the West Coast regions of the United States totaling 19.2 million square
feet of Total GLA. In addition, the Company has an option to acquire the stock
of Westland Realty, Inc., the holder of an indirect 50% interest in Garden State
Plaza, pursuant to the Garden State Plaza Option.

6
<PAGE>
CENTER PROFILE
<TABLE>
<CAPTION>
PERCENTAGE OF MALL 1996 MALL HISTORY AND
SHOPPING CENTER AND PERCENTAGE TOTAL GLA MALL GLA GLA LEASED AT STORE SALES STATUS
LOCATION(1) OWNERSHIP (SQ.FT.) (SQ.FT.) DECEMBER 31, 1996 (PER SQ. FT.)(2) OF DEVELOPMENT
- ------------------------------ ----------- ----------- ----------- ----------------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
EAST COAST
Annapolis Mall,(3) ........... 30 990,702 408,554 96% $ 371 Opened 1980
Annapolis, Maryland Redeveloped
1983/1994

Connecticut Post Mall,(4) .... 100 831,707 438,405 91 298 Opened 1960
Milford, Connecticut Redeveloped 1991

Enfield Square,(4)(5) ........ 100 678,822 260,632 76 215 Opened 1971
Enfield, Connecticut Redeveloped
1987/1997

Meriden Square, .............. 50 746,695 294,654 92 330 Opened 1971
Meriden, Connecticut Redeveloped
1988/1993

Montgomery Mall, ............. 100 1,253,482 467,872 97 405 Opened 1968
Bethesda, Maryland Redeveloped
1976/1982/1984
1991

South Shore Mall,(5)(6) ...... 100 1,108,111 370,962 92 292 Opened 1963
Bay Shore, New York Under
Redevelopment

Trumbull Shopping Park, ...... 100 1,160,716 464,088 86 314 Opened 1962
Trumbull, Connecticut Redeveloped
1982/1987/1990
1992
----------- ----------- --

Total (6)............... 6,770,235 2,705,167 92
----------- ----------- --

<CAPTION>
SHOPPING CENTER AND
LOCATION(1) MAJOR RETAILERS AND SPECIAL FEATURES
- ------------------------------ ------------------------------------
<S> <C>
EAST COAST
Annapolis Mall,(3) ........... Nordstrom, Hecht's, J.C. Penney,
Annapolis, Maryland Montgomery Ward
Connecticut Post Mall,(4) .... Filene's, J.C. Penney, Caldor
Milford, Connecticut
Enfield Square,(4)(5) ........ Filene's, J.C. Penney. Sears
Enfield, Connecticut scheduled to open Spring 1997
Meriden Square, .............. Filene's, J.C. Penney, Sears
Meriden, Connecticut
Montgomery Mall, ............. Nordstrom, Hecht's, Sears, J.C.
Bethesda, Maryland Penney
South Shore Mall,(5)(6) ...... Macy's, J.C. Penney. Sears scheduled
Bay Shore, New York to open Fall 1997
Trumbull Shopping Park, ...... Macy's, Filene's, Lord & Taylor,
Trumbull, Connecticut J.C. Penney
Total (6)...............
</TABLE>

7
<PAGE>
<TABLE>
<CAPTION>
PERCENTAGE OF MALL 1996 MALL
SHOPPING CENTER AND PERCENTAGE TOTAL GLA MALL GLA GLA LEASED AT STORE SALES
LOCATION(1) OWNERSHIP (SQ.FT.) (SQ.FT.) DECEMBER 31, 1996 (PER SQ. FT.)(2)
- ------------------------------ --------------- ----------- ------------ ----------------------- -----------------
<S> <C> <C> <C> <C> <C>
MID WEST
Mid Rivers Mall,(5) .......... 100 929,185 352,371 87 248
St. Peters, Missouri

South County Center,(4) ...... 100 754,063 259,360 93 270
St. Louis, Missouri

West County Center, .......... 100 583,646 152,590 95 267
Des Peres, Missouri

West Park Mall, .............. 100 502,856 230,505 92 212
Cape Girardeau,
Missouri

Westland Towne Center, ....... 100 470,943 137,520 95 175
Lakewood, Colorado
----------- ------------ --

Total................... 3,240,693 1,132,346 93
----------- ------------ --

WEST COAST

Eagle Rock Plaza, ............ 100 474,230 163,912 81 177
Los Angeles, California

Eastland Center,(5) .......... 100 819,244 617,444 76 --
West Covina, California

Mission Valley Center, ....... 76 1,340,410 508,492 96 283
San Diego, California

Mission Valley 76 178,624 178,624 82 283
Center-West,(5) .
San Diego, California

<CAPTION>
HISTORY AND
SHOPPING CENTER AND STATUS MAJOR RETAILERS AND SPECIAL
LOCATION(1) OF DEVELOPMENT FEATURES
- ------------------------------ ----------------- ---------------------------------
<S> <C> <C>
MID WEST
Mid Rivers Mall,(5) .......... Opened 1987 Famous-Barr, Dillard's, Sears,
St. Peters, Missouri Redeveloped J.C. Penney
1990/1996
South County Center,(4) ...... Opened 1963 Famous-Barr, Dillard's, J.C.
St. Louis, Missouri Redeveloped 1979 Penney
West County Center, .......... Opened 1969 Famous-Barr, J.C. Penney
Des Peres, Missouri Redeveloped 1985
West Park Mall, .............. Opened 1981 Famous-Barr, J.C. Penney, Venture
Cape Girardeau, Redeveloped 1984
Missouri
Westland Towne Center, ....... Opened 1960 Sears, Super Kmart
Lakewood, Colorado Redeveloped
1978/1994

Total...................

WEST COAST
Eagle Rock Plaza, ............ Opened 1973 Robinsons-May, Montgomery Ward
Los Angeles, California
Eastland Center,(5) .......... Opened 1957 Mervyn's, Target
West Covina, California Redeveloped
1979/1996/1997
(substantially
completed)
Mission Valley Center, ....... Opened 1961 Robinsons-May, Macy's, Montgomery
San Diego, California Redeveloped Ward, AMC 20-screen theater,
1975/1983 Nordstrom Rack
1996/1997
Mission Valley Opened 1961
Center-West,(5) . Under
San Diego, California Redevelopment
</TABLE>

8
<PAGE>
<TABLE>
<CAPTION>
PERCENTAGE OF MALL 1996 MALL
SHOPPING CENTER AND PERCENTAGE TOTAL GLA MALL GLA GLA LEASED AT STORE SALES
LOCATION(1) OWNERSHIP (SQ.FT.) (SQ.FT.) DECEMBER 31, 1996 (PER SQ. FT.)(2)
- ------------------------------ --------------- ----------- ------------ ----------------------- -----------------
<S> <C> <C> <C> <C> <C>
North County Fair,(7) ........ 45 1,243,551 363,054 79 316
Escondido, California

Plaza Bonita, ................ 100 822,075 313,248 94 304
National City, California

Plaza Camino Real, ........... 40 1,152,194 433,984 92 275
Carlsbad, California

The Plaza at West Covina, .... 100 1,233,582 585,488 91 256
West Covina, California

Topanga Plaza, ............... 42 1,085,038 373,006 95 332
Canoga Park, California

Vancouver Mall, .............. 50 870,141 328,575 88 243
Vancouver, Washington
----------- ------------ --

Total................... 9,219,089 3,865,827 92(8)
----------- ------------ --

Grand Total(6)........ 19,230,017 7,703,340 92(8)
----------- ------------ --
----------- ------------ --

<CAPTION>
HISTORY AND
SHOPPING CENTER AND STATUS MAJOR RETAILERS AND SPECIAL
LOCATION(1) OF DEVELOPMENT FEATURES
- ------------------------------ ----------------- ---------------------------------
<S> <C> <C>
North County Fair,(7) ........ Opened 1986 Nordstrom, Robinsons-May (2),
Escondido, California Macy's, J.C. Penney, Sears
Plaza Bonita, ................ Opened 1981 Robinsons-May, J.C. Penney,
National City, California Montgomery
Ward and Mervyn's
Plaza Camino Real, ........... Opened 1969 Macy's(2), Robinsons-May, Sears,
Carlsbad, California Redeveloped J.C. Penney
1979/1989
The Plaza at West Covina, .... Opened 1975 Robinsons-May, Macy's, Sears,
West Covina, California Redeveloped J.C. Penney
1990/1993
Topanga Plaza, ............... Opened 1964 Nordstrom, Robinsons-May, Sears,
Canoga Park, California Redeveloped Montgomery Ward
1984/1992/1994
Vancouver Mall, .............. Opened 1977 Nordstrom, Meier & Frank, Sears,
Vancouver, Washington Redeveloped J.C. Penney, Mervyn's
1979/1993
Total...................
Grand Total(6)........
</TABLE>

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

(1) For a description of the mortgage encumbrances on each Center, see "Business
and Properties--Debt Summary." All of the Centers are managed by Westfield
Holdings, other than North County Fair which is managed by Trizec Hahn
Corporation Limited.

(2) Sales are based on reports of Mall Store tenants reporting sales; Mall Store
sales are not provided for Eastland Center as such Center was under
redevelopment for all of 1996. Mall Store sales for Mission Valley Center
and Mission Valley Center--West are calculated on an aggregate basis for
such Centers. For Mall Store sales per square foot for 1994 and 1995 at such
Centers, see "Business and Properties--The East Coast Properties," "Business
and Properties--The Mid West Properties" and "Business and Properties--The
West Coast Properties."

(3) The Company has entered into a letter of intent to purchase the remaining
70% interest in Annapolis Mall from its Joint Venture partner.

(4) The Company's interest in this Center includes certain incidental long-term
ground leases.

(5) Under redevelopment.

(6) After giving effect to the South Shore Mall redevelopment anticipated to be
completed in Fall 1997.

(7) The Joint Venture which owns this Center leases it from the City of
Escondido pursuant to a 50-year ground lease which expires in 2033. This
Center is not managed by Westfield Holdings.

(8) Total and Grand Total are for Stabilized Centers and exclude North County
Fair as such Center is not managed by Westfield Holdings.

9
<PAGE>
The following table sets forth the number of Centers in each State and the
Total GLA per State for such Centers.

<TABLE>
<CAPTION>
TOTAL GROSS
NO. OF SHOPPING LEASABLE AREA PERCENT OF
STATE OF SHOPPING CENTER LOCATIONS CENTERS SQ. FT. TOTAL GLA
- -------------------------------------------------- --------------------- ------------- ---------------
<S> <C> <C> <C>
California........................................ 9 8,348,900 43%
Colorado.......................................... 1 470,900 2
Connecticut....................................... 4 3,417,900 18
Maryland.......................................... 2 2,244,200 12
Missouri.......................................... 4 2,769,800 14
New York.......................................... 1 1,108,100 6
Washington........................................ 1 870,100 5
</TABLE>

Business highlights of the operation and performance of the Centers include
the following:

- Successful redevelopment of a number of the Centers has generated
increased returns. The Company is in the process of redeveloping South
Shore Mall and anticipates that the redevelopment of Mission Valley
Center-West will commence in the second quarter of 1997. In addition, the
Company is currently planning the redevelopment of eight additional
Properties.

- In 1996, the Centers under Westfield Holdings's management (excluding the
recently redeveloped Eastland Center) reported average Mall Store sales
psf of $297 (and, including North County Fair, $300 psf for the same
period) as compared to an industry average of $278 psf for the same period
(Source: ICSC Monthly Mall Merchandise Index, February 1997).

- Mall GLA at Stabilized Centers was 92% leased as of December 31, 1996
(and, including North County Fair, 91% leased).

- Upon completion of construction at South Shore Mall and Enfield Square, 17
of the 19 Regional Centers will have three or more Anchors. The quality
and the number of Anchors both enhance the Centers' competitive position
with other retail facilities and make the development of competing centers
in the same trade area less likely.

- A significant concentration of Centers in California (43% of the Total GLA
of the Centers as of December 31, 1996) provides an excellent opportunity
to take advantage of that State's recent economic recovery.

- All of the Regional Centers are located on major road systems, primarily
in major metropolitan areas, including Los Angeles and San Diego,
California; Hartford, Connecticut; Portland, Oregon; St. Louis, Missouri;
Washington, D.C.; and Long Island, New York, providing easy access and
high visibility and thus creating a competitive advantage for the Company.

- The Centers have 74 Anchors operating under 18 trade names. The Company's
portfolio includes 20 May Company stores (Famous-Barr, Filene's, Hecht's,
Lord & Taylor, Meier & Frank, and Robinsons-May), 16 J.C. Penneys, 11
Sears, seven Federated (Macy's) and five Nordstrom stores. In addition,
other major Anchors include Dillard's, Dayton Hudson (Mervyn's, Target)
and Montgomery Ward. The Manager's strong relationships with these Anchors
enhance the Company's opportunities by providing substantial pre-leasing
of new projects, lease-up of existing space, improved tenant retention and
releasing opportunities. For a description of the total 1996 annualized
base rent and the percentage of Total GLA for such Anchors, see "Business
and Properties--Anchors."

- Montgomery Mall, the Company's Center with the largest revenues, was 97%
leased as of December 31, 1996, and had effective rents psf of $38 and
average Mall Store sales psf of $405, for the year ended December 31,
1996.

- Most of the Centers' Mall GLA is leased to national and regional chains,
including The Limited Stores (Abercrombie & Fitch, Bath & Body Works,
Express, Lane Bryant, Lerner's, Limited Too, Structure, The Limited and
Victoria Secret), The Gap (Banana Republic, Gap Kids, The Gap), Baker's
Shoes, CVS, Eddie Bauer, The Woolworth Corporation (Foot Locker and Kinney
Shoes),

10
<PAGE>
Edison Bros. (J. Riggins, JW and Oaktree), Kay Bee Toys & Hobby, The Body
Shop, The Disney Store and Warner Bros.

- In 1996, the Centers derived approximately 95% of their base rents from
Mall Stores. Mall Stores occupied approximately 40.1% of the Total GLA and
the balance of the Total GLA was represented by Anchors and outparcel
stores. No Mall Store retailer accounted for more than 5% of the Mall GLA
or more than 6% of the Company's 1996 annualized effective rent (I.E.,
base plus percentage rent), except for The Limited Stores, a clothing
retailer, which occupied approximately 10% of Mall GLA and accounted for
11% of the 1996 Mall Store annualized effective rent.

THE COMPANY'S STRATEGY FOR OPERATIONS AND GROWTH

GENERAL STRATEGY

The Company's goal is to increase per share Funds from Operations and
thereby maximize the long-term value of the Company and the return to
shareholders through the following key strategies: (i) the redevelopment,
expansion and market repositioning of its current Centers, (ii) the acquisition
of additional regional and super regional shopping centers with a view towards
increasing the value of such centers through redevelopment, expansion and
repositioning, (iii) the improvement of the operating performance of its
properties through intensive and efficient management, cost control, leasing and
marketing and (iv) the awareness and anticipation of trends in the retailing
industry and the introduction of new retailing concepts to the Centers.

REDEVELOPMENT, REPOSITIONING AND EXPANSION POTENTIAL AND IMPLEMENTATION

The Company believes that redevelopment, repositioning and expansion are key
to maximizing the use and performance of its assets and increasing income growth
and capital appreciation. The Company is continually evaluating the
redevelopment potential of its Properties and anticipates that it will pursue
opportunities for substantial redevelopment and repositioning at the Properties.
The Company also believes that Westfield Holdings is well situated to take
advantage of these opportunities, due to, among other things, its management
expertise and its ability to utilize operating staff, ideas and systems from its
operations in the United States, Australia and Asia.

Since 1994, the Company has completed or substantially completed the
redevelopment of Eastland Center in West Covina, California, Enfield Square in
Enfield, Connecticut, Mid Rivers Mall in St. Peters, Missouri and Mission Valley
Center in San Diego, California. The Company is currently redeveloping South
Shore Mall in Bay Shore, New York. This redevelopment involves the addition of a
Sears store and 40,000 square feet of Mall GLA. Project completion is scheduled
for Fall 1997. The foregoing Centers represent approximately 25.4% of Total GLA.

The Company expects to commence the redevelopment of Mission Valley
Center--West in the Fall of 1997 to create a new power center with
value-oriented retailers that will complement Mission Valley Center. In
addition, the Company has identified eight additional Properties for
redevelopment over the next five years, which the Company believes will result
in future income growth and capital appreciation. For a more detailed
description of redevelopment planning, see "The Company--The Company's Strategy
for Operations and Growth--Redevelopment, Repositioning and Expansion Potential
and Implementation."

The Company has entered into a letter of intent with National Australia Bank
Limited, Australia and New Zealand Banking Group Limited, Commonwealth Bank of
Australia and Union Bank of Switzerland to provide a $600.0 million unsecured
line of credit which may be used to finance the implementation of its
redevelopment and acquisition strategies. There can be no assurance that a
definitive credit agreement with respect to this loan facility will be entered
into.

ACQUISITION OF NEW CENTERS AND JOINT VENTURE INTERESTS

11
<PAGE>
the goals that the property be of a quality consistent with the Company's
portfolio, that the property has potential for increased income and value
through redevelopment and/or repositioning and that the property generates
sufficient income pending any such redevelopment to support the acquisition
price. The Company's strategy also includes seeking to acquire the Outside
Partners' interests in the Joint Venture Centers.

The Company has entered into a letter of intent with its Joint Venture
partner, RREEF USA Fund-III/Annapolis, Inc., to purchase the remaining 70%
interest in Annapolis Mall, together with an adjoining parcel of real property
leased to Montgomery Ward & Co., for an aggregate purchase price of $133.0
million (the "Annapolis Acquisition"). Although no assurance can be given in
this regard and the Annapolis Acquisition is subject to numerous conditions, the
Company expects the Annapolis Acquisition to close in the second quarter of
1997. See "The Company--The Company's Strategy for Operations and
Growth--Acquisition of New Centers and Joint Venture Interests" and "Business
and Properties-- Additional Information Regarding Annapolis Mall."

The Company has also entered into an agreement to acquire approximately 70%
of the partnership interests in Wheaton Plaza Regional Shopping Center LLP, the
entity that owns Wheaton Plaza Regional Shopping Center located in Wheaton,
Montgomery County, Maryland for a purchase price of $52.5 million (the "Wheaton
Acquisition"). The enclosed, one-level center (with a two-level connection to
Hecht's), which opened in 1960, has over 1.1 million square feet of total gross
leasable area, with 120 mall stores and three anchors: J.C. Penney, Montgomery
Ward and Hecht's. The Wheaton partnership also owns two office buildings of
approximately 107,000 square feet and approximately 73,000 square feet. Wheaton
Plaza was originally constructed as an open-air mall and was enclosed in 1981.
One of the Company's principal reasons for making the acquisition is due to the
center's redevelopment potential, although the Company has no current plans for
redevelopment. See "The Company--The Company's Strategy for Operations and
Growth--Acquisition of New Centers and Joint Venture Interests" and "Business
and Properties--Additional Information Regarding Wheaton Plaza."

In addition, the Company holds the Garden State Plaza Option. See "The
Company--The Company's Strategy for Operations and Growth--Garden State Plaza
Option" and "Business and Properties-- Additional Information Regarding Garden
State Plaza."

INCREASING OPERATING INCOME FROM EXISTING SPACE; INTENSIVE MANAGEMENT APPROACH

Westfield Holdings concentrates on actively managing the Centers and
providing efficient and customer-friendly service to both the consumers who shop
in the Centers and the retailers who lease space in the Centers while strictly
controlling operating costs. The concept of the "Westfield Customer Service
System" has been introduced in the Centers to train and focus the personnel at
the Centers on its retailers and customers. The Company believes that this is
one of the most important strategies that differentiates Westfield Holdings's
management philosophy from the Company's competitors. The Company believes that
branding the Centers through advertising, promotions and customer service
programs will build shopper recognition and loyalty, especially in multi-center
markets.

Westfield Holdings's management strategy includes initiatives designed to
increase customer traffic through the Centers, which improves sales turnover
and, ultimately, rents. Initiatives include increasing occupancy levels,
increasing revenue by increasing rentable area within the existing building
envelope, the introduction of cost control efficiencies resulting in a reduction
of operating costs, maximizing the temporary leasing program, improving the
merchandise mix and range of tenants, developing emerging themes such as
entertainment, cinemas and Category Killer retailers, converting non-productive
space to mall gross leasable area and promoting such converted space with
intensive marketing.

The Company seeks to increase rental income from existing space by leasing
currently unleased space, increasing base rent as current leases with below
market rents expire, negotiating new leases to reflect step-ups in base rent,
and repositioning and aggressively marketing to increase sales productivity and
expand the market penetration and market base. The average base rental rate per
square foot at the Centers has increased at a compound annual rate of
approximately 4.5% from December 31, 1994 through December 31, 1996 (4.2% for
the same period, including North County Fair).

12
<PAGE>
COMPANY STRUCTURE AND HISTORY

The Company was incorporated in 1924 for the purpose of holding title to
certain department store properties and has been involved in developing shopping
centers since the mid 1950's. In 1994, Prudential sold 40% of the Company to
Westfield Holdings and the remainder to certain other investors, after
Prudential had filed a registration statement for the initial public offering of
common stock of the Company to the public but before marketing of the securities
commenced or such registration statement was declared effective. In 1995,
Westfield Holdings acquired an additional 10% of the Company. In 1996 and early
1997, the Company was recapitalized when WAT acquired 74.6% of the outstanding
Common Stock and a warrant (the "1996 WAT Warrant") to purchase 6,246,096 shares
of Common Stock from the Company. In addition the Company sold $134.0 million of
non-voting preferred stock and Common Stock to foreign and U.S. investors
(inclusive of a $14.0 million investment that certain of the then existing
investors agreed to retain in the Company). The Company utilized a portion of
the proceeds of the sale of its Common Stock and non-voting preferred stock to
repurchase the stock of certain investors other than Westfield Holdings.

Contemporaneously with these transactions, the Company acquired indirect
ownership of Connecticut Post Mall, Trumbull Shopping Park and South Shore Mall
(collectively, the "Acquired Properties") from interests associated with the
Lowy family and an option to acquire the stock of Westland Realty, Inc., the
holder of an indirect 50% interest in Garden State Plaza from Westfield
Holdings. For more information on the Garden State Plaza Option and the
transactions referred to above, see "Certain Transactions-- Relationships and
Transactions with Westfield Holdings."

These transactions are referred to collectively as the "Recapitalization."

As part of the Recapitalization, Stichting Pensioenfonds ABP, an entity
established under the laws of the Kingdom of the Netherlands ("ABP"), acquired
an equity interest in the Company through the purchase of 940,000 shares of
Series A preferred stock, par value $1.00 per share, of the Company (the "Series
A Preferred Shares"), with an aggregate liquidation amount of $94.0 million. ABP
has agreed to acquire, subject to the satisfaction of certain conditions, an
additional equity interest in the Company by purchasing 270,000 shares of Series
B preferred stock, par value $1.00 per share, of the Company (the "Series B
Preferred Shares" and, together with the Series A Preferred Shares, the
"Preferred Stock") with an aggregate liquidation amount of $27.0 million
simultaneously with the closing of the Offerings. Although the Company expects
all of the conditions to the sale of the Series B Preferred Shares will be
satisfied, no assurance can be given in this regard. Following consummation of
the Offerings and concurrent transactions, ABP will hold options issued by WAT
that permit ABP to acquire units of WAT for cash or in exchange for Series A
Preferred Shares or Series B Preferred Shares. See "Description of Capital
Stock--Preferred Stock."

Also simultaneously, with the closing of the Offerings, WAT will acquire a
warrant (the "1997 WAT Warrant" and, together with the 1996 WAT Warrant, the
"WAT Warrants") to purchase 2,089,552 shares of additional Common Stock from the
Company at the same price as the initial public offering price for the Shares.
The sale price for the 1997 WAT Warrant will be $2.6 million.

WAT currently owns 77.3% of the Common Stock and Westfield Holdings
currently owns 18.5% of the Common Stock on a fully-diluted basis. As a result
of these transactions and after giving effect to the Offerings and concurrent
transactions and taking account of the maximum number of Shares which may be
acquired under the Orders, WAT will own 62.4%, and Westfield Holdings will own
16.7% (31.7% including its indirect interest through WAT) of the outstanding
Common Stock on a fully-diluted basis. Westfield Holdings will also hold an
approximately 24.0% equity interest in WAT on a fully diluted basis. In
addition, ABP will have an approximately $121.0 million investment in the
Company through the ownership of the Preferred Stock. See "Principal
Shareholders."

13
<PAGE>
The following diagram illustrates the results of the foregoing transactions
and the beneficial ownership of the Company upon consummation of the Offerings
and concurrent transactions and taking account of the Shares to be acquired
under the Orders on a fully diluted basis.

[For Edgar Version, the diagram indicates ownership of the Company, warrants and
management/ development/advisory relationships.]

14
<PAGE>
FINANCING POLICIES

The Company currently intends to adhere to a policy of maintaining a ratio
of debt-to-Total Market Capitalization of not more than 50%. No assurance can be
given in this regard, however, and the organizational documents of the Company
do not limit the amount or percentage of indebtedness that it may incur. On a
pro forma basis at March 31, 1997, after giving effect to the Offerings and
concurrent transactions and the application of the net proceeds as set forth in
"Use of Proceeds," the Company would have a ratio of debt-to-Total Market
Capitalization of approximately 44%. The debt-to-Total Market Capitalization
ratio, which is based upon the market value of the Company's equity and,
accordingly, fluctuates with changes in the price of the Common Stock, differs
from the debt-to-total asset ratio, which is based upon book values. The
consolidated pro forma debt-to-total asset ratio at March 31, 1997 was 51%. See
"Capitalization." The Company may from time to time reevaluate its debt policy
in light of current economic conditions, relative costs of debt and equity
capital, changes in the Company's market capitalization, growth and acquisition
opportunities and other factors, and modify its debt financing policy
accordingly. As a result, the Company may increase its debt-to-Total Market
Capitalization ratio beyond the limits described above. See "Risk Factors--Risks
Associated with Debt Financing--No Limitation on Debt." If the Board of
Directors (or, in the case of certain Joint Ventures in which the Company does
not act as managing general partner, an Outside Partner) determines that
additional funding is required, the Company or the Joint Ventures may raise such
funds through additional equity offerings, debt financing or retention of cash
flow (subject to provisions in the the Internal Revenue Code of 1986, as amended
(the "Code") concerning taxability of undistributed income), or a combination of
these methods. See "Policies and Objectives with Respect to Investment,
Financing and Other Certain Activities--Financing."

FEDERAL INCOME TAX CONSIDERATIONS AND
TAX STATUS OF THE COMPANY

The Company elected to be taxed as a REIT under the Code, commencing with
its taxable year ending December 31, 1994, and the Company intends to continue
to operate in such a manner. If the Company continues to qualify for taxation as
a REIT, the Company generally will not be taxed at the corporate level so long
as it distributes to its shareholders at least 95% of its taxable income
currently. REITs are subject to numerous technical organizational and
operational requirements. Skadden, Arps, Slate, Meagher & Flom LLP has issued an
opinion as to the Company's qualification as a REIT. If the Company fails to
qualify for taxation as a REIT in any taxable year, the Company generally will
be subject to Federal income tax (including any applicable alternative minimum
tax) on its taxable income at regular corporate rates. See "Risk
Factors--Adverse Consequences of Failure to Qualify as a REIT." Even if the
Company continues to qualify for taxation as a REIT, the Company could be
subject to certain state and local taxes on its income and property and Federal
and state income and excise taxes on its undistributed income and undistributed
net capital gains in accordance with the Code and applicable state law. In
addition, the Company may be subject to certain other taxes if it engages in
transactions which are prohibited transactions under the Code. See "Federal
Income Tax Considerations."

15
<PAGE>
THE OFFERINGS

All of the Shares offered hereby are being offered by the Company.

<TABLE>
<S> <C>
Shares of Common Stock offered......... 18,000,000 shares(1)
U.S. Offering........................ 15,300,000 shares
International Offering............... 2,700,000 shares

Shares of Common Stock outstanding
After the Offerings.................. 79,265,183 shares(1)(2)

Use of Proceeds........................ To fund in part, the Garden State Plaza Loan to be
made to Westfield Holdings, the Annapolis
Acquisition, the Wheaton Acquisition and the
purchase of the Westfield Holdings Warrants.

Proposed NYSE symbol................... "WEA"
</TABLE>

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

(1) Does not include 2,700,000 shares of Common Stock that may be issued upon
the exercise of the U.S. Underwriters' and International Managers'
over-allotment options.

(2) Includes 8,335,648 shares of Common Stock that may be issued upon exercise
of the WAT Warrants.

DISTRIBUTIONS

The Company intends to continue to pay regular quarterly distributions to
the holders of its Common Stock. Since Westfield Holdings's acquisition of an
interest in the Company on February 11, 1994, the Company has made regular
quarterly distributions on its Common Stock. The Company made distributions of
$36.5 million for the period from February 12, 1994 through December 31, 1994
(or 68.5% of Funds from Operations), $75.4 million for the period from January
1, 1995 through December 31, 1995 (or 114.6% of Funds from Operations) and $78.5
million for the period from January 1, 1996 through December 31, 1996 (or 103.5%
of Funds from Operations). For the period from February 12, 1994 through
December 31, 1996, the Company made distributions of $190.4 million (or 98% of
Funds from Operations). Following such distributions, the Company received
recontributions from its shareholders of $4.1 million, $3.2 million and $3.4
million in 1994, 1995 and 1996, respectively. For the three month period ended
March 31, 1997, the Company has declared a distribution of $.373 per share (or
97% of Funds from Operations in the aggregate) to its shareholders.

For the period February 12, 1994 through December 31, 1996, the Company
distributed approximately 98% of its Funds from Operations. However, the Company
intends to revise its policy upon consummation of the Offerings such that it
will distribute annually approximately 90% of its Funds from Operations through
December 31, 1998. Thereafter, the Company intends to distribute annually
approximately 90% to 95% of its Funds from Operations; however, the Company does
not intend to distribute more than 100% of Funds from Operations less recurring
capital expenditures (not including capital expenditures recovered from tenants)
and rental income attributable to rent straight-lining. As a result of the
revision of its policy, the Company has declared a special distribution to the
shareholders of the Company immediately prior to the closing of the Offerings in
an amount of $13.0 million (the "Special Distribution"). The Special
Distribution is payable on the regular payment date for the second quarter
distribution if the Offerings occur or, if the Offerings do not occur, in seven
quarterly installments at the same time as the Company's regular quarterly
distributions. The Special Distribution represents a portion of the
distributions estimated at the time of WAT's initial offering of units in
Australia for the period through 1998.

16
<PAGE>
portion of the second quarter preceding the closing of the Offerings, such
distribution to be payable on or before the regular payment date for the second
quarter distribution.

It is estimated that initially approximately 35% of the distribution to the
Company's shareholders will represent a return of capital for tax purposes. The
expected size of the distributions may not allow the Company, using only cash
flow from operations, to fund 100% of (i) the tenant allowances and (ii) the
retirement of all of its debt when due, and therefore, the Company may be
required to seek periodic debt or equity financings to cover such items. The
Company's income will consist primarily of its share of income from the
Properties. Differences in timing between the receipt of income and the payment
of expenses in arriving at taxable income of the Company, and the effect of
required debt amortization payments, could require the Company to borrow funds
on a short-term basis to meet the REIT distribution requirements even if the
Company believes that then prevailing market conditions are not generally
favorable for such borrowings or that such borrowings would not be advisable in
the absence of such tax considerations. In addition, no distributions may be
paid on any Common Stock unless the full dividends on the Preferred Shares have
been paid. See "Policies and Objectives with Respect to Investments, Financing
and Other Certain Activities--Financing."

The Company plans to adopt a distribution reinvestment plan under which its
shareholders may elect to reinvest all or part of their distributions
automatically in additional shares of Common Stock. Any such distribution
reinvestment plan will not adversely affect the Company's ability to qualify as
a REIT for Federal income tax purposes. The Company understands that WAT plans
to adopt a similar plan for its unitholders and intends to use the proceeds of
such distribution reinvestment plan to participate in the Company's distribution
reinvestment plan, although no assurance can be given in this regard. The
Company also understands that Westfield Holdings intends to participate in WAT's
distribution reinvestment plan to the full extent of its distributions on its
units in WAT for a three-year period commencing with the first distribution
period for which reinvestment is permitted, although no assurance can be given
in this regard.

The Company computes Funds from Operations in accordance with standards
established by the White Paper on Funds from Operations approved by the Board of
Governors of NAREIT in March 1995 which defines Funds from Operations as net
income (loss) (computed in accordance with GAAP), excluding gains (or losses)
from debt restructuring and sales of property, plus real estate related
depreciation and amortization and after adjustments for unconsolidated
partnerships and joint ventures except for the years ended December 31, 1993 and
1992 for which income taxes are not included. Funds from Operations should not
be considered as an alternative to net income (determined in accordance with
GAAP) as a measure of the Company's financial performance or to cash flow from
operating activities (determined in accordance with GAAP) as a measure of the
Company's liquidity, nor is it indicative of funds available to fund the
Company's cash needs, including its ability to make distributions. In addition,
Funds from Operations as computed by the Company may not be comparable to
similarly titled figures reported by other REITs.

Notwithstanding the foregoing, all distributions will be at the discretion
of the Board of Directors and will depend on the actual Funds from Operations,
the Company's financial condition, the annual distribution requirements under
the REIT Requirements and such other factors as the Board of Directors deems
relevant and will be subject to the prior payment of preferred stock dividends.
See "Risk Factors-- Distributions to Shareholders; Potential Requirement to
Borrow."

17
<PAGE>
SUMMARY FINANCIAL DATA

The following table sets forth historical and unaudited pro forma
consolidated financial data for the Company and should be read in conjunction
with the Consolidated Financial Statements of Westfield America, Inc. and the
Notes thereto, the Pro Forma Condensed Consolidated Financial Information of the
Company (unaudited) and the Notes thereto and "Management's Discussion and
Analysis of Financial Condition and Results of Operations." The Company believes
that the book value of its real estate assets, which reflect the historical
costs of such real estate assets less accumulated depreciation, is less than the
current market value of its properties.

The results for 1994 are not comparable to prior years because of the
acquisition of the Company in February 1994. Hence, a Pro Forma adjustment has
been applied to historical results of operations for the 42 days ended February
11, 1994 to present operating and other data as if the acquisition of the
Company on February 12, 1994 had been consummated on January 1, 1994. The
results for 1996 are not comparable to prior years because of the
Recapitalization, the acquisition of the Acquired Properties and the
consolidation of the Mission Valley Partnership.

Unaudited pro forma operating information is presented as if the
consummation of the Offerings and concurrent transactions and Recapitalization
had occurred as of the period presented, and therefore incorporates certain
assumptions that are described in the Notes to the Pro Forma Condensed
Consolidated Statement of Income (unaudited). The Pro Forma balance sheet
(unaudited) data is presented as if the Offerings and concurrent transactions
and the Recapitalization had occurred on March 31, 1997.

The unaudited Pro Forma information does not purport to represent what the
Company's financial position or results of operations would actually have been
if these transactions had, in fact, occurred on such date or at the beginning of
the periods indicated, or to project the Company's financial position or results
of operations at any future date or for any future period.

18
<PAGE>
SUMMARY SELECTED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
-------------------------------------
UNAUDITED
PRO FORMA
1997 1997 1996
------------ ------------ ---------
(IN THOUSANDS OF DOLLARS, EXCEPT PER
SHARE AMOUNTS AND RATIOS)
<S> <C> <C> <C>
OPERATING DATA:
Total revenue............................................................................. $ 56,034 $ 46,903 $ 32,001
Operating expenses........................................................................ 18,856 15,927 10,518
Interest expense, net..................................................................... 14,172 12,860 7,482
Depreciation and amortization............................................................. 12,828 11,539 8,027
------------ ------------ ---------
Income before other income and income taxes........................................... 10,425 6,577 5,974
Equity in net income (loss) of unconsolidated real estate partnerships.................... 501 1,293 733
Interest and other income................................................................. 3,637 312 230
Gains on sales of properties and partnership interests.................................... -- -- --
------------ ------------ ---------
Income before income taxes and minority interest...................................... $ 14,563 8,182 6,937
Income taxes.............................................................................. -- -- --
Minority interest in earnings of consolidated real estate partnership..................... (931) (218) (230)
------------ ------------ ---------
Net income............................................................................ $ 13,637 $ 7,964 $ 6,707
------------ ------------ ---------
------------ ------------ ---------
Earnings per share (1).................................................................... $ 0.16 $ 0.11 $ 0.15
------------ ------------ ---------
------------ ------------ ---------
OTHER DATA:
EBITDA (2)................................................................................ $ 45,045 $ 37,242 $ 27,540
Funds from operations (3)................................................................. $ 29,055 $ 22,564 $ 18,046
Cash flows provided by operating activities............................................... $ -- $ 11,570 $ 11,808
Cash flows (used in) provided by investing activities..................................... $ -- $ (5,389) $ (833)
Cash flows (used in) provided by financing activities..................................... $ -- $ (10,263) $ (9,510)
Ratio of earnings to combined fixed charges (4)........................................... 1.87 1.59 1.99
Ratio of FFO to combined fixed charges (4)................................................ 2.58 2.33 3.30

YEAR ENDED DECEMBER 31,
--------------------------------------
UNAUDITED
PRO FORMA
1996 1996 1995
------------ ------------ ----------

<S> <C>
OPERATING DATA:
Total revenue............................................................................. $ 220,072 $ 156,089 $ 111,327
Operating expenses........................................................................ 78,153 55,903 36,849
Interest expense, net..................................................................... 55,465 40,233 27,916
Depreciation and amortization............................................................. 48,287 38,033 28,864
------------ ------------ ----------
Income before other income and income taxes........................................... 38,167 21,920 17,698
Equity in net income (loss) of unconsolidated real estate partnerships.................... 55 3,063 3,359
Interest and other income................................................................. 13,512 776 789
Gains on sales of properties and partnership interests.................................... -- -- --
------------ ------------ ----------
Income before income taxes and minority interest...................................... 51,734 25,759 21,846
Income taxes.............................................................................. -- -- --
Minority interest in earnings of consolidated real estate partnership..................... (3,006) (1,063) --
------------ ------------ ----------
Net income............................................................................ $ 48,728 $ 24,696 $ 21,846
------------ ------------ ----------
------------ ------------ ----------
Earnings per share (1).................................................................... $ 0.54 $ 0.42 $ 0.48
------------ ------------ ----------
------------ ------------ ----------
OTHER DATA:
EBITDA (2)................................................................................ $ 172,033 $ 124,352 $ 102,199
Funds from operations (3)................................................................. $ 108,291 $ 75,842 $ 65,792
Cash flows provided by operating activities............................................... -- $ 55,888 $ 42,990
Cash flows (used in) provided by investing activities..................................... -- $ (91,613) $ 5,476
Cash flows (used in) provided by financing activities..................................... -- $ 42,454 $ (62,722)
Ratio of earnings to combined fixed charges (4)........................................... 1.72 1.60 2.25
Ratio of FFO to combined fixed charges (4)................................................ 2.49 2.52 3.35

<CAPTION>
PREDECESSOR
PERIOD FROM PERIOD FROM YEAR ENDED
FEBRUARY 12, JANUARY 1, DECEMBER
1994 THROUGH 1994 THROUGH 31,
DECEMBER 31, FEBRUARY 11, -----------
1994 1994 1993
------------ ------------ -----------

OPERATING DATA:
Total revenue............................................................................. $ 99,456 $ 12,769 $ 105,237
Operating expenses........................................................................ 36,606 6,869 51,731
Interest expense, net..................................................................... 24,156 481 7,160
Depreciation and amortization............................................................. 24,897 3,605 29,011
------------ ------------ -----------
Income before other income and income taxes........................................... 13,797 1,814 17,335
Equity in net income (loss) of unconsolidated real estate partnerships.................... (386) (2,151) (3,177)
Interest and other income................................................................. 1,830 340 2,996
Gains on sales of properties and partnership interests.................................... -- -- 2,566
------------ ------------ -----------
Income before income taxes and minority interest...................................... 15,241 3 19,720
Income taxes.............................................................................. -- -- (13,819)
Minority interest in earnings of consolidated real estate partnership..................... -- -- --
------------ ------------ -----------
Net income............................................................................ $ 15,241 $ 3 $ 5,901
------------ ------------ -----------
------------ ------------ -----------
Earnings per share (1).................................................................... $ 0.34
------------
------------
OTHER DATA:
EBITDA (2)................................................................................ $ 83,529 $ 8,691 $ 80,432
Funds from operations (3)................................................................. $ 53,315 $ 4,942 $ 60,472
Cash flows provided by operating activities............................................... $ 20,665 $ 5,294 $ 35,883
Cash flows (used in) provided by investing activities..................................... $ 23,556 $ (23,501) $ (42,778)
Cash flows (used in) provided by financing activities..................................... $ (67,988) $ 26,013 $ (13,722)
Ratio of earnings to combined fixed charges (4)........................................... 2.89 --(3) 3.47
Ratio of FFO to combined fixed charges (4)................................................ 3.21 --(3) 7.26

1992
----------

OPERATING DATA:
Total revenue............................................................................. $ 102,545
Operating expenses........................................................................ 53,929
Interest expense, net..................................................................... 24,652
Depreciation and amortization............................................................. 22,650
----------
Income before other income and income taxes........................................... 1,314
Equity in net income (loss) of unconsolidated real estate partnerships.................... (76)
Interest and other income................................................................. 4,191
Gains on sales of properties and partnership interests.................................... 23,428
----------
Income before income taxes and minority interest...................................... 28,857
Income taxes.............................................................................. (11,231)
Minority interest in earnings of consolidated real estate partnership..................... --
----------
Net income............................................................................ $ 17,626
----------
----------
Earnings per share (1)....................................................................

OTHER DATA:
EBITDA (2)................................................................................ $ 94,545
Funds from operations (3)................................................................. $ 37,974
Cash flows provided by operating activities............................................... $ 25,138
Cash flows (used in) provided by investing activities..................................... $ (3,999)
Cash flows (used in) provided by financing activities..................................... $ 14,742
Ratio of earnings to combined fixed charges (4)........................................... 1.47
Ratio of FFO to combined fixed charges (4)................................................ 2.45
</TABLE>

19
<PAGE>
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEAR
MARCH 31, ENDED
-------------------------- DECEMBER
UNAUDITED 31,
PRO FORMA ---------
1997 1997 1996
------------ ------------ ---------
(IN THOUSANDS OF DOLLARS, EXCEPT PER
SHARE AMOUNTS AND RATIOS)
BALANCE SHEET DATA:
<S> <C> <C> <C>
Investment in real estate, net............................................................ $ 1,635,962 $ 1,305,462
Total assets.............................................................................. 1,684,802 1,339,002
Mortgage and notes payable................................................................ 858,262 783,285
Minority interest......................................................................... -- --
Shareholders' equity...................................................................... 794,907 524,084

YEAR ENDED
DECEMBER
31,
----------
1995 1994 1993
------------ ------------ ----------

BALANCE SHEET DATA:
<S> <C>
Investment in real estate, net............................................................ $ 1,310,434 $ 829,484
Total assets.............................................................................. 1,344,570 844,706
Mortgage and notes payable................................................................ 770,625 426,781
Minority interest......................................................................... 54 --
Shareholders' equity...................................................................... 518,530 380,419

1992
------------

BALANCE SHEET DATA:
Investment in real estate, net............................................................ $ 848,892 $ 884,392
Total assets.............................................................................. 882,667 944,490
Mortgage and notes payable................................................................ 420,397 38,205
Minority interest......................................................................... -- --
Shareholders' equity...................................................................... 430,782 669,967

BALANCE SHEET DATA:
Investment in real estate, net............................................................ $ 851,168
Total assets.............................................................................. 951,678
Mortgage and notes payable................................................................ 317,857
Minority interest......................................................................... --
Shareholders' equity...................................................................... 393,466

<CAPTION>
BALANCE SHEET DATA:
Investment in real estate, net............................................................
Total assets..............................................................................
Mortgage and notes payable................................................................
Minority interest.........................................................................
Shareholders' equity......................................................................
</TABLE>

(1) Unaudited pro forma net income and earnings per share for the three months
ended March 31, 1997 and the year ended December 31, 1996 are based on
70,930 shares of Common Stock outstanding after the Offering. Information
for the period January 1, 1994 through February 11, 1994 and the year ended
December 31, 1993 and 1992 is not presented because it is not comparable.

(2) EBITDA represents the Company's share of net income before interest, taxes,
depreciation and amortization. While EBITDA should not be construed as an
alternative to operating income (as determined in accordance with GAAP) as
an indicator of the Company's operating performance or to cash flows from
operating activities (as determined in accordance with GAAP) as a measure of
liquidity and other consolidated income or cash flow statement data
determined in accordance with GAAP, the Company believes that EBITDA is an
effective measure of shopping center operating performance because EBITDA is
unaffected by the debt and equity structure of the property owner.

(3) The Company computes Funds from Operations in accordance with standards
established by the White Paper on Funds from Operations approved by the
Board of Governors of NAREIT in March 1995 which defines Funds from
Operations as net income (loss) (computed in accordance with GAAP) excluding
gains (or losses) from debt restructuring and sales of property, plus real
estate related depreciation and amortization and after adjustments for
unconsolidated partnerships and joint ventures except for the years ended
December 31, 1993 and 1992 for which income taxes are not included. Funds
from Operations should not be considered as an alternative to net income
(determined in accordance with GAAP) as a measure of the Company's financial
performance or to cash flow from operating activities (determined in
accordance with GAAP), as a measure of the Company's liquidity, nor is it
indicative of funds available to fund the Company's cash needs, including
its ability to make distributions. Funds from Operations as computed by the
Company may not be comparable to similarly titled figures reported by other
REITS.

(4) Combined fixed charges consist of interest expense, whether expensed or
capitalized, amortization of debt expense and income allocable on Senior
Preferred Shares, Series A Preferred Shares and on an unaudited Pro Forma
basis, Series B Preferred Shares.

(5) The computation for the 42 days ended February 11, 1994 is not presented as
it is not comparable.

20
<PAGE>
RISK FACTORS

PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE FOLLOWING INFORMATION IN
CONJUNCTION WITH THE OTHER INFORMATION CONTAINED IN THIS PROSPECTUS BEFORE
PURCHASING SHARES IN THE OFFERINGS.

POSSIBLE CONFLICTS OF INTERESTS WITH INSIDE PARTIES AND RELATED PARTY
TRANSACTIONS

INFLUENCE OF WAT AND WESTFIELD HOLDINGS

Upon consummation of the Offerings and concurrent transactions and taking
account of the maximum number of Shares which may be acquired under the Orders,
WAT will own 62.4% and 58.0%, and Westfield Holdings will own 16.7% and 18.7%,
of the outstanding Common Stock on a fully-diluted and non-fully diluted basis,
respectively. Westfield Holdings will also hold approximately 24.0% of the
outstanding units of WAT on a fully-diluted basis. Westfield Holdings Limited is
an independent company from the Company and, except for the acquisition by the
Company of the Westfield Holdings Warrants, the purchasers of the Shares will
not acquire any interest in Westfield Holdings Limited. To maintain the
Company's qualification as a REIT, generally no Individual (other than Frank P.
Lowy and the members of his family, who are subject to a higher ownership
threshold based on their current percentage ownership that is in excess of the
limit currently applicable to other shareholders) may directly or indirectly
hold more than 5.5%, by value, of the Company's stock.

In addition, WAT is managed by Westfield America Management Limited ("WAM"),
a subsidiary of Westfield Holdings Limited. The WAT Trustee generally exercises
all of the voting rights over the shares of Common Stock as directed by WAM,
subject to applicable Australian law and certain other exceptions including an
exception in relation to the designation and election of directors of the
Company as set forth below. See "Principal Shareholders." The WAT Trustee may
only vote shares for the election of directors as directed by a majority of the
WAT unitholders voting on the matter at a meeting of unitholders. By virtue of
WAT's substantial ownership of Common Stock, WAT is in a position to exercise
significant influence on the Company. The Company is also managed and advised by
Westfield Holdings. Accordingly, WAT and Westfield Holdings together will be
able to elect all of the Company's directors and to control the vote on all
matters submitted to the Company's shareholders including approval of mergers,
sales of all or substantially all of the Company's assets, and "going private"
transactions and to exercise significant influence on the decision to terminate
the Manager, Developer or Advisor.

As of December 31, 1996, interests associated with the Lowy family owned
approximately 45% of the ordinary shares of Westfield Holdings Limited and 9% of
the outstanding WAT units and members of the Lowy family act as officers and
directors of Westfield Holdings, the manager of WAT and the Company. By virtue
of their ownership interests in Westfield Holdings Limited and WAT and their
positions as officers and directors, the Lowy family is in a position to
exercise significant influence on Westfield Holdings, WAT and the Company with
respect to the foregoing matters.

CONFLICTS OF INTERESTS WITH INSIDE PARTIES

Approximately $160.3 million of the proceeds of the Offerings and concurrent
transactions will be utilized to purchase the Westfield Holdings Warrants and to
make the Garden State Plaza Loan to Westfield Holdings. In addition, WAT will
purchase the 1997 WAT Warrant. The terms, agreements and understandings relating
to these transactions were negotiated by the Company and Westfield Holdings or
WAT. See "Certain Transactions."

By virtue of the contractual relationship between Westfield Holdings and the
Company with respect to management, development and advisory services and its
substantial ownership of Common Stock, Westfield Holdings has interests that may
conflict with the interests of persons acquiring Shares in the Offerings.
Implementation of the Company's key growth strategies will result in increased
management, development and advisory fees to Westfield Holdings. See "The
Company--The Company's Strategy for Operations and Growth" and "Advisory,
Management and Development Services to the Company."

21
<PAGE>
Both WAT, by virtue of its stock ownership of the Company, and Westfield
Holdings, by virtue of its ownership of Common Stock, units of WAT and
management of WAT and the Company, are in a position to exercise significant
influence over the affairs of the Company, which influence might not be
consistent with the interests of other shareholders. Certain officers and/or
directors of Westfield Holdings also act as officers and/or directors of the
Company.

A subsidiary of Westfield Holdings Limited is also the manager of WAT and
certain officers and/or directors of such subsidiary are also directors and/or
officers of the Company. In addition, all of the executive officers of the
Company are employed by and provide services to Westfield Holdings and other
properties managed by Westfield Holdings. All of the executive officers, other
than Frank P. Lowy, currently devote substantially all of their time to the
business and affairs of the Company. The Company anticipates that such officers
will continue to devote substantially all of their time to the business and
affairs of the Company. However, as a result of services performed for Westfield
Holdings and other properties managed by Westfield Holdings, there may be
periods of time during which a particular officer devotes less than
substantially all, or less than a majority, of his or her time to the business
and affairs of the Company.

Westfield Holdings will agree that, during the period in which it is the
Manager of the Centers and Advisor to the Company, it will not acquire any
ownership interest in shopping center properties or power centers in the United
States or manage or develop a shopping center property in competition with a
Center owned by the Company, except in the case of the acquisition by Westfield
Holdings of an entity that does not have any ownership interest in shopping
center properties and power centers in the United States and is then managing or
developing a competitive center (in addition to other properties). This non-
competition agreement shall not apply to any activity by Westfield Holdings with
respect to airport projects. Each of Frank Lowy, David Lowy, Peter Lowy and
Steven Lowy will agree with the Company that he will not acquire any ownership
interest in shopping center properties or power centers in the United States for
so long as (i) Westfield Holdings is the Advisor to the Company and the Manager
of the Centers, and (ii) interests associated with the Lowy family have
significant ownership and significant management involvement in Westfield
Holdings Limited. The terms of these agreements are summarized in "Advisory,
Management and Development Services to the Company." See "Principal
Shareholders," "Certain Transactions--Relationships and Transactions with
Westfield Holdings" and "Certain Transactions--Relationships and Transactions
with WAT."

RELIANCE ON WESTFIELD HOLDINGS; LACK OF CONTROL OVER
DAY-TO-DAY ACTIVITIES OF OUTSIDE MANAGEMENT

Subsidiaries of Westfield Holdings Limited have management contracts (the
"Management Agreements") to manage the operations and leasing of the Centers and
an advisory agreement (the "Advisory Agreement") with the Company to provide
corporate strategic planning, administrative and other asset management services
to the Company. The Company has also entered into a master development framework
agreement (the "Master Development Framework Agreement") with a subsidiary of
Westfield Holdings Limited to perform the necessary planning and predevelopment
work to determine if a particular development is feasible and economically
viable and to provide the development services. The Company has agreed that any
properties acquired in the future that it controls will be subject to the
Management Agreements and Master Development Framework Agreement. The Company
has no employees and relies entirely on Westfield Holdings for the management of
the Company and the Centers and is not currently able to operate without
Westfield Holdings.

Because the Company cannot elect the directors of the Manager, the Advisor
or the Developer, its ability to control their actions on a day to day basis is
limited. However, the Company does have various approval rights over aspects of
management and development including that the Manager must operate within
budgets and leasing guidelines approved by the Company and in accordance with
policies set by the Company and that all development projects are subject to the
approval of the Company's Board of Directors (including at least 75% of the
Independent Directors) of the plans and feasibility for such project and the
cost thereof. If the guidelines are not met or the Company does not grant its
approval to a

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development project, then the Manager or the Developer may not take actions to
lease the property or commence a development project. If the Manager or
Developer nonetheless takes any such action and a material breach of the
Management or Development Agreement occurs, then the Manager, Advisor or
Developer may be terminated. In addition, the Company generally has the ability
to terminate the agreements after the initial three-year term upon certain
conditions, including a determination by at least 75% of the Independent
Directors and the WAT Trustee (so long as WAT owns at least 10% of the capital
stock of the Company) not to renew the Management or Advisory Agreements because
of unsatisfactory performance of the Manager or the Advisor that is materially
detrimental to the Company or because the fees thereunder are not fair. The
Company may also terminate the agreements upon the occurrence and during the
continuance of an event of default under the Garden State Plaza Loan.

The terms, agreements and understandings relating to these transactions were
negotiated by the Company and Westfield Holdings. The Company believes that,
although these agreements were negotiated between associated parties, they
reflect market terms. The Company has discretion as to whether or not to
undertake a development project. The fees payable by the Company under the
Master Development Framework Agreement for any development project are subject
to the review and approval of the Board of Directors, including at least 75% of
the Independent Directors.

For further details, see "Advisory, Management and Development Services to
the Company."

LIMITATIONS ON ACQUISITIONS AND CHANGE IN CONTROL

There are limitations on the ability of the shareholders of the Company to
change control of the Company due to the significant ownership by Westfield
Holdings and WAT of the outstanding Common Stock. In addition, restrictions on
direct or constructive ownership of more than 5.5% by an individual (other than
Frank P. Lowy and the members of his family) of the Company's outstanding shares
of capital stock may prevent a change of control of the Company. The ownership
restriction is designed in part to ensure that the REIT ownership requirements
continue to be met by the Company.

The ownership restrictions, the substantial influence of WAT and Westfield
Holdings and certain other provisions of the Company's Third Amended and
Restated Articles of Incorporation (the "Articles") and Amended and Restated
By-Laws (the "By-Laws") and of Missouri law, may discourage a change in control
of the Company and may also (i) deter tender offers for the Common Stock which
offers may be advantageous to holders of the shares and (ii) limit the
opportunities of holders of the Common Stock to receive a premium for their
shares that might otherwise exist if an investor were attempting to assemble a
block of shares or otherwise effect a change of control of the Company. These
provisions include, among others, (i) a classified Board of Directors, (ii) the
availability of capital stock for issuance from time to time at the discretion
of the Board of Directors, (iii) inability of shareholders to take action by
written consent, (iv) prohibitions against shareholders calling a special
meeting of shareholders, (v) requirements for advance notice for raising of
business or making nominations at shareholders' meetings and (vi) additional
requirements for business combination transactions. See "Certain Provisions of
the Company's Articles of Incorporation and By-Laws and of Missouri Law."

RISKS GENERALLY INHERENT IN REAL ESTATE INVESTMENT

GENERAL FACTORS AFFECTING INVESTMENTS IN REAL ESTATE;
EFFECT OF ECONOMIC AND REAL ESTATE CONDITIONS

A shopping center's revenues and value may be adversely affected by a number
of factors, including but not limited to: the national economic climate; the
regional economic climate (which may be adversely affected by plant closings,
industry slowdowns and other factors); local real estate conditions (such as an
oversupply of retail space); perceptions by retailers or shoppers of the safety,
convenience and attractiveness of the shopping center; trends in the retail
industry; competition for tenants; high vacancy rates; changes in market rental
rates; the inability to collect rent due to bankruptcy or insolvency of tenants
or otherwise; the need periodically to renovate, repair and relet space and the
costs thereof; the ability of an owner to provide adequate maintenance and
insurance; increased operating costs; and the willingness and ability of the
property's owner to provide capable management and adequate maintenance. These
factors

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could influence the price a purchaser would be willing to pay for a Center if
the Company elects to sell such Center. In the case of vacant space, the Company
may not get full credit for the income that can be earned from such vacant space
in determining the sales price. In addition, other factors may adversely affect
a shopping center's value without affecting its current revenues, including:
changes in governmental regulations, zoning or tax laws; potential environmental
or other legal liabilities; and changes in interest rate levels.

GEOGRAPHIC CONCENTRATION

Nine of the 22 Centers are located in California (representing approximately
43% of the Total GLA), four are located in Missouri (representing approximately
14% of the Total GLA) and four are located in Connecticut (representing
approximately 18% of the Total GLA). To the extent that general economic or
other relevant conditions in these regions decline and result in a decrease in
consumer demand in these regions, the Company's performance may be adversely
affected. The markets for certain Centers are also significantly dependent on
the financial results of major local employers and on industry concentrations.
For example, the sales growth of the Centers located in California was
negatively affected by the California economic recession from 1990 to 1993.

RISKS OF EXPANSION, REDEVELOPMENT AND ACQUISITION ACTIVITIES

The Company may incur risks in connection with the redevelopment and
expansion of existing shopping centers or the redevelopment of new and existing
shopping centers. These risks include the risk that redevelopment opportunities
explored by the Company may be abandoned after funds have been expended; the
risk that permits or approvals required for such development may not be
obtained; the risk that construction costs of a project may exceed original
estimates, possibly making the project uneconomical; the risk that redevelopment
may temporarily disrupt income; and the risk that occupancy rates and rents at a
completed project will not be sufficient to make the project profitable. In case
of an unsuccessful expansion or redevelopment project, the Company's loss could
exceed its investment in the project. Also, there may be competitors seeking to
expand properties or to acquire properties for redevelopment, some of which may
have greater resources than the Company. See "The Company--Company's Strategy
for Operations and Growth--Redevelopment, Repositioning and Expansion Potential
and Implementation" and "The Company--The Company's Strategy for Operations and
Growth--Acquisition of New Centers and Joint Venture Interests."

RELIANCE ON CERTAIN TENANTS AND ANCHORS

The Company's income and Funds from Operations could be adversely affected
in the event of the bankruptcy or insolvency, or a downturn in the business, of
any Anchor tenant or Anchor-owned store, or if any Anchor tenant does not renew
its lease when it expires. If the tenant sales in the Centers were to decline,
tenants might be unable to pay their rent or other occupancy costs. In the event
of default by a tenant, delays and costs in enforcing the lessor's rights could
be experienced. In addition, lease termination by one or more Anchor tenants of
a shopping center or the closing of one or more Anchor-owned stores whose
reciprocal easement agreements or leases may permit closing could result in
lease terminations or reductions in rent by other tenants whose leases may
permit cancellation or rent reduction in those circumstances and adversely
affect the Company's ability to re-lease the space that is vacated. Similarly,
the leases of certain Anchor tenants, and the reciprocal easement agreements to
which certain of the Anchor-owned stores are parties, permit an Anchor to
transfer its interest in a shopping center to another retailer, often only after
the expiration of an initial period. The transfer to a new Anchor tenant could
adversely affect customer traffic in the Center and thereby reduce the income
generated by that Center and could also allow certain other Anchors and other
tenants to make reduced rental payments or to terminate their leases at that
Center. Each of these developments could adversely affect the Company's Funds
from Operations and its ability to make expected distributions to shareholders.

As of December 31, 1996, Anchors owned (in fee or subject to ground leases)
49.7% and leased 10.2% of the Total GLA of the Centers. As of the same date, the
May Company owned 17.0%, J.C. Penney owned 9.9% and Sears owned 8.1% of the
Total GLA. No other Anchor owned more than 4.1% of the Total GLA.

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Also, as of such date, Macy's leased 2.8% of Total GLA and no other Anchor
leased more than 2.7% of Total GLA. Also as of such date J.C. Penney represented
1.1% of the aggregate annualized base rent of the Centers and no other Anchor
represented more than 1.1% of the aggregate annualized base rent of the Centers.

Collectively, tenants whose parent company is The Limited Stores occupy over
10% of the Mall GLA. These tenants include Abercrombie & Fitch, Bath & Body
Works, Express, Lane Bryant, Lerner, The Limited, Structure and Victoria Secret,
among others. While each of these tenants is operated as an independent
subsidiary, an unexpected negative change in the financial strength of the
parent company, The Limited Stores, could conceivably result in the loss of some
or all of the revenues provided to the Company under the leases executed with
these tenants.

In addition to being an Anchor at many of the Centers, the May Company is
the lessee under financing leases of the May Properties. A negative change in
the financial condition of the May Company could result in the loss of some or
all of the revenues provided to the Company under the May Properties.

The Company has established a temporary leasing program pursuant to which it
leases Mall Store space on a short-term basis (usually for a term of between 30
days to eleven months) pending its ability to secure suitable long term tenants.
These leases are generally subject to the termination by the Company on 30 days
notice. This short-term leasing program may present risks not encountered in
typical long-term retail leasing arrangements as the Company may not be able to
re-lease such space upon expiration of any such short-term lease.

COMPETITION

All of the Centers are located in developed retail and commercial areas.
With respect to certain of the Centers, other malls or neighborhood and
community shopping centers, may compete within the Primary Trade Area of each of
the Centers. The amount of rentable space in the relevant Primary Trade Area,
the quality of facilities and the nature of stores at such competing malls could
each have a material adverse effect on the Company's ability to lease space and
on the level of rents the Company can obtain. In addition, retailers at the
Centers face potentially changing consumer preferences and increasing
competition from other forms of retailing, such as discount shopping centers,
outlet malls, upscale neighborhood strip centers, catalogues, discount shopping
clubs and telemarketing. In addition, while specific competitive conditions vary
on a center-by-center basis, all of the Centers are located in major
metropolitan areas which are served by multiple retailing outlets and
accordingly face strong competition. See "Business and Properties--The Shopping
Center Business" and "Business and Properties--Competition."

Although the Company believes the Centers compete effectively within their
trade areas, the Company must also compete with other owners, managers and
developers of super regional and regional shopping centers. Those competitors
that are not REITs may be at an advantage to the extent they can utilize working
capital to finance projects, while the Company (and its competitors that are
REITs) will be required by the annual distribution provisions under the Code to
distribute significant amounts of cash from operations to its shareholders. In
addition, the Company intends to distribute more cash to its shareholders than
is required by the Code. See "Distributions." If the Company should require
funds, it may have to borrow when the cost of capital is high. Moreover,
increased competition could adversely affect the Company's revenues and Funds
from Operations. See "Business and Properties--Competition."

LIQUIDITY OF ASSETS

Equity real estate investments are relatively illiquid and therefore tend to
limit the ability of the Company to vary its portfolio promptly in response to
changes in economic or other conditions. Additionally, the corporate level tax
that would be imposed upon certain built-in gains may make it uneconomical for
the Company or the applicable subsidiary to sell certain assets owned on the
first day of the first taxable year for which the Company or the applicable
subsidiary qualified as a REIT within 10 years of such applicable qualification
date, without adversely affecting returns to shareholders. See "--Possible
Taxation on Capital Gains" and "Federal Income Tax Considerations--Taxation of
the Company."

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RISKS OF TENANT BANKRUPTCY

Because virtually all of the Company's income consists of rental income paid
by retail tenants at the Centers, the Company's cash flow and its ability to
make distributions to shareholders will be adversely affected if the Company is
unable to lease a significant amount of space in the Centers, or if a
significant number of tenants are unable to pay their rent. In times of
recession or other economic downturn, there is an increased risk that retail
tenants will be unable to meet their obligations to the Company, otherwise
default under their leases, or become debtors in cases under the Bankruptcy
Code. If any tenant becomes a debtor in a case under the Bankruptcy Code, the
Company would not be permitted to evict the tenant solely because of its
bankruptcy, but the bankruptcy court could authorize the tenant to reject and
terminate its lease with the Company. The Company's claim against such a tenant
for unpaid, future rent would be subject to a statutory cap that could be
substantially less than the remaining rent actually owned under the lease. In
any event, the Company's claim for unpaid rent (as capped) would likely not be
paid in full.

The bankruptcy of an Anchor could have especially adverse consequences for a
Center, both by depriving the Company of the rent due from the Anchor and by
reducing foot traffic at the Center, impairing the performance of the remaining
tenants and their ability to meet their obligations to the Company.

The bankruptcy of any tenant, including any Anchor, and the rejection of its
lease may provide a Center with an opportunity to lease the vacant space to
another more desirable tenant on better terms, but there can be no assurance
that the Company would be able to do so. The Company has experienced retail
bankruptcies by tenants in the past, including Edison Bros., Judy's, Paul Harris
and Merry Go Round. The Company experienced no adverse effects of such
bankruptcies because the stores were either acquired by stronger tenants or were
acquired by the Company and re-leased at the same or higher rents.

LACK OF UPDATED TITLE INSURANCE

The Company will not obtain new policies of title insurance on the
Properties. Based upon (i) the Company's review of the existing owner's and/or
mortgagee's title insurance policies, which have been issued with respect to 12
of the Properties within the last six years, (ii) updated title reports obtained
by the Company for certain of the Properties, and (iii) the absence of any
knowledge by the Company of material title defects since Westfield Holdings
acquired an interest in the Company, the Company has determined that the
substantial cost of new owner's title insurance policies for the full market
value of these properties is not warranted.

CHANGES IN LAWS AFFECTING REAL ESTATE

Costs resulting from changes in real estate tax laws or real estate tax
rates generally are passed through to tenants and therefore should not affect
the Company. Changes in laws increasing the potential liability for
environmental conditions existing at properties, increasing the restrictions on
discharges or other hazardous waste conditions, or increasing building code or
similar local law requirements may result in significant unanticipated
expenditures which would adversely affect the Company's Funds from Operations
and its ability to make distributions to shareholders.

LAWS BENEFITTING DISABLED PERSONS

A number of Federal, state and local laws (including the Americans with
Disabilities Act of 1990) and regulations exist that may require modifications
to existing buildings or restrict certain renovations by requiring improved
access to such buildings by disabled persons. Additional legislation or
regulations may impose further burdens or restrictions on owners with respect to
improved access by disabled persons. The costs of compliance with such laws and
regulations may be substantial, and limits or restrictions on completion of
certain renovations may limit implementation of the Company's investment
strategy in certain instances or reduce overall returns on its investments. The
Company will review its properties periodically to determine the level of
compliance and, if necessary, take appropriate action to bring such properties
into compliance. Although management has concluded based on its review to date
that the costs of compliance with such current laws and regulations will not
have a material adverse effect on the Company, no assurance can be given in this
regard.

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RISKS ASSOCIATED WITH DEBT FINANCING

POSSIBLE INABILITY TO REFINANCE BALLOON PAYMENTS ON DEBT

The Company does not expect to have sufficient Funds from Operations to be
able to make all of the balloon payments of principal on the debt of the Joint
Ventures and the Company in the aggregate principal amount of $854.1 million on
a pro forma basis as of March 31, 1997, after giving effect to the Offerings and
concurrent transactions and the application of the net proceeds as set forth in
"Use of Proceeds" (including amounts allocable to the Outside Partners) which
becomes due in the period 1999 through 2001. The Company intends to refinance
such debt at or before maturity or otherwise to obtain funds through secured
financings by utilizing unencumbered properties or unsecured financings. The
Company may also issue equity or debt in order to obtain funds. Any such equity
issuance may have a dilutive effect on existing shareholders of the Company.
However, there can be no assurance that the Company or the Outside Partners will
be able to refinance any such indebtedness or to otherwise obtain funds on
commercially reasonable terms, if at all. An inability to make such balloon
payments when due could cause a mortgage lender to foreclose on such properties,
which could have a material adverse effect on the Company. In addition, interest
rates on any debt incurred to refinance mortgage debt or debt facilities may be
higher than the rates on the current mortgages or debt facilities or at floating
rates.

The Company has entered into interest rate exchange agreements with a
counterparty to manage future interest rates. These agreements consists of swaps
and involve the future receipt, corresponding with the expiration of existing
fixed rate mortgage debt, of a floating rate based on LIBOR and the payment of a
fixed rate. In the unlikely event that a counterparty fails to meet the terms of
an interest rate exchange agreement, the Company's exposure is limited to the
interest rate differential on the notional amount. The Company does not
anticipate non-performance by the counterparty.

At December 31, 1996, the Company had interest rate exchange agreements
beginning February 11, 1999 and expiring after three years with notional
principal amounts totaling $90 million which provide that the Company will pay
6.125% per annum. Subsequently, the Company entered into interest rate exchange
agreements beginning in February 1999 and April 2000 and expiring at various
dates in 2002 with notional principal amounts totaling $227.0 million which
provide that the Company will pay 6.25% per annum.

These exchange rate agreements ensure that, upon the expiration of certain
of the Company's mortgage debt, if the Company refinances such debt with new
LIBOR based loans, the interest rate on such loans will be no more than 6.125%
or 6.25%, plus the applicable spread of the loan at such time.

NO LIMITATION ON DEBT

On a pro forma basis as of March 31, 1997, after giving effect to the
Offerings and concurrent transactions and the application of the net proceeds as
set forth in "Use of Proceeds," the Company would have an aggregate of $951
million of debt, including $354.0 million of fixed rate debt, at an average
interest rate of 6.4% per annum, with Prudential secured and
cross-collateralized by seven wholly-owned Centers and $76.0 million of fixed
rate debt, at an average interest rate of 7.1% per annum, secured by the May
Properties. Except for a $15.0 million portion of the Prudential loan which
relates to the redevelopment of Mid Rivers Mall, such indebtedness is all
non-recourse.

The Company currently intends to adhere to a policy of maintaining a ratio
of a debt-to-Total Market Capitalization of not more than 50%. No assurance can
be given in this regard, however, and the organizational documents of the
Company do not limit the amount or percentage of indebtedness that it may incur.
On a pro forma basis at March 31, 1997, after giving effect to the Offerings and
concurrent transactions and the application of the net proceeds as set forth in
"Use of Proceeds," the Company would have a ratio of debt-to-Total Market
Capitalization of approximately 44%. As of March 31, 1997, the Company's balance
of cash and cash equivalents was $2.6 million, not including its proportionate
share of cash held by unconsolidated real estate partnerships. In addition, the
Company has entered into a letter of intent for a new $600.0 million unsecured
revolving credit facility with National Australia Bank Limited, Australia and
New Zealand Banking Group Limited, Commonwealth Bank of Australia and Union Bank

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of Switzerland, of which approximately $163.0 million would be used to refinance
existing secured debt and the balance of which would be used by the Company to
fund redevelopment and acquisition activities, as well as for working capital,
capital costs and general corporate purposes. There can be no assurance that a
definitive credit agreement with respect to this credit facility will be entered
into.

The Company currently anticipates that cash from operations and its working
capital facility will be available to fund its business operations, recurring
and certain developmental capital expenditures, continuing debt service
obligations (other than the balloon payments discussed above), the payment of
distributions, accounts payable and deferred taxes in respect of installment
sales and other dispositions of property. Additional borrowings will be required
for developmental capital expenditures and may from time to time be required in
connection with the obligations described in the preceding sentence. There can
be no assurance, however, that such borrowings will be available on commercially
reasonable terms, if at all. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations-- Liquidity and Capital Resources"
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations--Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividends."

EFFECTS OF DEBT FINANCING

The Company is subject to the risks normally associated with debt financing,
including the risk that the Company's cash flow from operations will be
insufficient to meet required payments of principal and interest, the risk that
existing indebtedness will not be able to be refinanced or that the terms of
such refinancing will not be as favorable as the terms of such indebtedness, and
the risk that necessary capital expenditures for such purposes as renovations
and other improvements will not be able to be financed on favorable terms or at
all. Certain significant expenditures associated with a property (such as
mortgage payments and other indebtedness) are generally not reduced when
circumstances cause a reduction in income from such property. Should such events
occur, the Company's Funds from Operations and its ability to make expected
distributions to shareholders would be adversely affected. If a property is
mortgaged to secure payment of indebtedness and the Company is unable to meet
mortgage payments, the property could be transferred to the mortgagee (or other
third parties) with a consequent loss of income and asset value to the Company.
The Company has entered into a letter of intent for a new $600 million revolving
credit facility, which loan facility will contain customary financial covenants
and limitations on changes in the Advisor or the Manager without the approval of
the lenders, although no assurance can be given that such loan facility will be
entered into. The Company has $354.0 million of mortgage indebtedness held by
Prudential which contains cross-default and cross-collateralization features
among seven properties. See "Business and Properties--Debt Summary." Under
cross-default provisions, a default under the mortgages included in the
cross-defaulted loan constitutes a default under all such mortgages and can lead
to acceleration of the indebtedness due on each center within the collateral
package. Pursuant to such cross-collateralization feature, the excess of the
value of a center over the mortgage indebtedness specific to that center serves
as additional collateral for the entire indebtedness.

With respect to the loan obtained by the Joint Venture which owns North
County Fair, the lender participates in a percentage of gross revenues above a
specified base and after deduction of debt service and various expenses.

INTEREST RATE SWAPS

At December 31, 1996, the Company had two swap agreements with respect to
interest currently payable by the Company. Interest rate swaps are contractual
agreements between the Company and third parties to exchange fixed and floating
interest payments periodically without the exchange of the underlying principal
amounts (notional amounts). In the unlikely event that a counterparty fails to
meet the terms of an interest rate swap contact, the Company's exposure is
limited to the interest rate differential on the notional amount. The Company
does not anticipate non-performance by any of the counterparties. Under one of
the swap agreements, which has a notional amount of $125.0 million, the Company
is credited interest at LIBOR and incurs interest at a fixed rate of 5.75%.
Under the second swap agreement, which

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has a notional amount of $11.4 million, the Company incurs interest at LIBOR and
is credited interest at a fixed rate of 6.23%. Both swap agreements expire in
2000.

In addition, the Company has entered into interest rate exchange agreements
with a counterparty to manage future interest rates as described in "--Possible
Inability to Refinance Balloon Payments on Debt."

ADVERSE CONSEQUENCES OF FAILURE TO QUALIFY AS A REIT

FAILURE TO QUALIFY AS A REIT

Qualification as a REIT involves the application of highly technical and
complex provisions of the Code (for which there are only limited judicial or
administrative interpretations) and the determination of various factual matters
and circumstances not entirely within the Company's control. For example, in
order to qualify as a REIT, at least 95% of the Company's gross income in any
year must be derived from qualifying sources and the Company must make
distributions to shareholders aggregating annually to at least 95% of its REIT
taxable income (excluding net capital gains). In addition, the Company's
qualification as a REIT depends on the qualification of Westland Properties,
Inc., a subsidiary of the Company ("WPI") as a REIT. Although the Company and
WPI each believes that it has operated since February 12, 1994 in the case of
the Company and since January 1, 1996 in the case of WPI in a manner so as to
qualify as a REIT, and the Company and WPI intend to continue to operate in a
manner so as to continue to qualify as a REIT, no assurance can be given that
the Company or WPI is or will remain so qualified. See "Federal Income Tax
Considerations." Although the Company is not aware of any pending tax
legislation that would adversely affect the Company's or WPI's ability to
operate as a REIT, no assurance can be given that new legislation, regulations,
administrative interpretations or court decisions will not change the tax laws
with respect to qualification as a REIT or the Federal income tax consequences
of such qualification.

Skadden, Arps, Slate, Meagher and Flom LLP, tax counsel to the Company, has
issued its opinion that, commencing with the Company's taxable year ended
December 31, 1994, the Company was organized in conformity with the requirements
for qualification as a REIT, and its planned method of operation, and its actual
method of operation from February 12, 1994, will enable it to meet the
requirements for qualification and taxation under the Code. In addition,
Skadden, Arps, Slate, Meagher and Flom LLP, as tax counsel to WPI, has issued
its opinion that, commencing with WPI's taxable year ended December 31, 1996,
WPI was organized in conformity with the requirements for qualification as a
REIT, and its planned method of operation, and its actual method of operation
from January 1, 1996, will enable it to meet the requirements for qualification
and taxation under the Code. In rendering these opinions, Skadden, Arps, Slate,
Meagher & Flom LLP relied on certain assumptions and representations made by the
Company and WPI as of the date thereof regarding factual matters and on opinions
of local counsel with respect to matters of local law. The opinions are
expressed based upon facts, representations and assumptions as of their date and
Skadden, Arps, Slate, Meagher & Flom LLP has no obligation to advise holders of
Common Stock of any subsequent change in the matters stated, represented or
assumed or any subsequent change in applicable law. No assurance can be given
that the Company or WPI has met these requirements or will continue to meet
these requirements in the future, and a legal opinion is not binding on the
Internal Revenue Service (the "IRS").

If, in any taxable year, the Company fails to qualify as a REIT, the Company
would not be allowed a deduction for distributions to shareholders in computing
taxable income and would be subject to Federal income tax on its taxable income
at corporate rates. As a result of the additional tax liability, the Company
might need to borrow funds or liquidate certain investments in order to pay the
applicable tax and the funds available for investment or distribution to the
Company's shareholders would be reduced for each of the years involved. In
addition, the Company would no longer be required by the Code to make any
distributions. Unless entitled to relief under certain statutory provisions, the
Company would also be disqualified from treatment as a REIT for the four taxable
years following the year during which qualification is lost. Although the
Company currently intends to operate in a manner designed to qualify as a REIT,
it is possible that future economic, market, legal, tax or other considerations
may cause the

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Company to fail to qualify as a REIT or may cause the Board of Directors of the
Company with the consent of a majority of the holders of the Preferred Stock and
Common Stock to revoke the REIT election. See "Federal Income Tax
Considerations."

OWNERSHIP LIMIT

In order for the Company to maintain its qualification as a REIT, not more
than 50% of the value of its outstanding stock may be owned, directly or
constructively, by five or fewer individuals or entities (as set forth in the
Code and referred to herein as "Individuals"). Upon consummation of the
Offerings, the Articles will prohibit, subject to certain exceptions, direct or
constructive ownership of more than 5.5%, by value, of the outstanding shares of
capital stock of the Company by any Individual (except for Frank P. Lowy and the
members of his family who are prohibited from owning, directly or indirectly,
more than 26% of the outstanding capital stock of the Company). The U.S.
constructive ownership rules are complex and may cause shares of capital stock
owned directly or constructively by a group of related individuals or entities
to be constructively owned by one individual or entity. The Articles authorize
the Board of Directors to increase the ownership restrictions if the Board of
Directors obtains satisfactory assurances that ownership in excess of a
particular limit will not jeopardize the Company's status as a REIT. A transfer
of shares to a person who, as a result of the transfer, would violate the
ownership restrictions, may be void. Under some circumstances, such shares may
be transferred to a trust, for the benefit of one or more qualified charitable
organizations designated by the Company, with the intended transferee having
only a right to share (to the extent of the transferee's original purchase price
for such shares) in proceeds from the trust's subsequent sale of such shares.
See "Federal Income Tax Considerations--Taxation of the Company--Requirements
for Qualification" and "Description of Capital Stock--Restrictions on Ownership
and Transfer" for additional information regarding the Ownership Limitations.

POSSIBLE TAXATION ON CAPITAL GAINS

Pursuant to an election made by the Company and to be made by WPI under
Internal Revenue Service Notice 88-19 ("Notice 88-19"), if during the ten-year
period beginning on the first day (the "Qualification Date") of the first
taxable year for which each such entity qualified as a REIT (February 12, 1994
for the Company and January 1, 1996 for WPI), the Company or WPI recognizes gain
on the disposition of any property (including, any partnership interest) held by
the Company or WPI or any partnership in which the Company or WPI held an
interest as of the Qualification Date, then, to the extent of the excess of (i)
the fair market value of such property as of the Qualification Date over (ii)
the adjusted income tax basis of the Company or WPI or the partnerships in such
property as of the Qualification Date, the Company and WPI, as the case may be,
will be required to pay a corporate level Federal income tax on its share of
such gain at the highest regular corporate rate.

Additionally, the taxable portion of the distributions paid to shareholders
of an entity that is subject to such corporate level tax will be increased by
the amount that the current and accumulated earnings and profits of such entity
are increased in respect of such gain. See "Federal Income Tax Considerations"
- -- "Taxation of the Company," "Federal Income Tax Considerations--Taxation of
Taxable Domestic Shareholders" and "Federal Income Tax Considerations--Taxation
of Foreign Shareholders." Although the Company and WPI have no present intention
to dispose of any such property in a manner that would trigger such tax
consequences, there can be no assurance that such dispositions will not occur.
Among other reasons, such dispositions could occur in the case of properties
held by the Company or WPI through partnerships and with respect to which the
Company and WPI may not have control over disposition decisions. See
"--Conflicts of Interest with Outside Partners in Jointly-Owned Centers and
Limited Control With Respect to Certain Activities."

DISTRIBUTIONS TO SHAREHOLDERS; POTENTIAL REQUIREMENT TO BORROW

To obtain the favorable tax treatment associated with REITs qualifying under
the Code, the Company generally will be required each year to distribute to its
shareholders at least 95% of its net taxable income (excluding any net capital
gain). In addition, the Company will be subject to tax on its undistributed net

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taxable income and net capital gain, and to a 4% nondeductible excise tax on the
amount, if any, by which certain distributions paid by it with respect to any
calendar year are less than the sum of 85% of its ordinary income plus 95% of
its capital gain net income for the calendar year plus certain undistributed
amounts from prior years.

The Company intends to make distributions to its shareholders to comply with
the distribution provisions of the Code and to avoid income taxes and the
nondeductible excise tax. The Company's income will consist primarily of its
share of income from the Properties. Differences in timing between the receipt
of income and the payment of expenses in arriving at taxable income of the
Company, and the effect of required debt amortization payments could require the
Company to borrow funds on a short-term basis to meet the REIT distribution
requirements even if the Company believes that then prevailing market conditions
are not generally favorable for such borrowings or that such borrowings would
not be advisable in the absence of such tax considerations. For Federal income
tax purposes, distributions paid to shareholders may consist of ordinary income,
capital gains, nontaxable return of capital or a combination thereof. The
Company will provide its shareholders with an annual statement indicating the
tax character of the distributions.

For the three month period ended March 31, 1997, the Company has declared a
distribution of $.373 per share (or 97% of Funds from Operations in the
aggregate) to its shareholders. For the period February 12, 1994 through
December 31,1997, the Company distributed approximately 98% of its Funds from
Operations. However, the Company intends to revise its policy upon consummation
of the Offerings and to distribute annually approximately 90% of its Funds from
Operations through December 31, 1998. Thereafter, the Company intends to
distribute annually approximately 90% to 95% of its Funds from Operations;
however, the Company does not intend to distribute more than 100% of Funds from
Operations less recurring capital expenditures (not including capital
expenditures recovered from tenants) and rental income attributable to rent
straight-lining. As a result of the revision of its policy, the Company has
declared the Special Distribution for the shareholders of the Company
immediately prior to the closing of the Offerings in an amount of $13.0 million,
such Special Distribution to be payable on the regular payment date for the
second quarter distribution if the Offerings occur or, if the Offerings do not
occur, in seven quarterly installments at the same time as its regularly
quarterly distributions. The Special Distribution represents a portion of the
distributions estimated at the time of WAT's initial offering of units in
Australia for the period through 1998.

The Company intends to pay a pro rata distribution to all shareholders with
respect to the period from the closing of the Offerings through June 30, 1997
based upon $0.35 per share for a full quarter. On an annual basis, this
distribution would be $1.40 per share. In addition, the Company has declared a
distribution to the shareholders of the Company immediately preceding the
closing of the Offerings for the portion of the second quarter preceding the
closing of the Offerings, such distribution to be payable on or before the
regular payment date for the second quarter distribution. No distributions may
be paid on any Common Stock unless the full dividends on the Preferred Shares
have been paid. See "Distributions" and "Description of Capital Stock." The
expected size of the distributions may not allow the Company, using only cash
flow from operations, to fund 100% of (i) the tenant allowances associated with
renewal or replacement of current tenants as their leases expire and (ii) the
retirement of all of its debt when due, and therefore, the Company may be
required to seek periodic debt or equity financings to cover such items. The
Company's income will consist primarily of its share of income from the
Properties. Differences in timing between the receipt of income and the payment
of expenses in arriving at taxable income of the Company, and the effect of
required debt amortization payments, could require the Company to borrow funds
on a short-term basis to meet the REIT distribution requirements even if the
Company believes that then prevailing market conditions are not generally
favorable for such borrowings or that such borrowings would not be advisable in
the absence of such tax considerations. In addition, no distributions may be
paid on any Common Stock unless the full dividends on the Preferred Shares have
been paid. In addition, the Company's distribution policy may negatively affect
the Company in adverse market conditions and result in a reevaluation of the
level of distributions. In economic conditions where market prices for shopping

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center properties are decreasing, the Company's distribution policy may place
the Company at a competitive disadvantage with respect to potential acquisitions
to other entities that distribute at a lower payout ratio because retained
earnings are a favorable source of capital. See "Policies and Objectives with
Respect to Investments, Financing and Other Certain Activities--Financing."

The Company plans to adopt a distribution reinvestment plan under which its
shareholders may elect to reinvest all or part of their distributions
automatically in additional shares of Common Stock. Any such distribution
reinvestment plan will not adversely affect the Company's ability to qualify as
a REIT for U.S. Federal income tax purposes. The Company understands that WAT
plans to adopt a similar plan for its unitholders, and intends to use the
proceeds of such distribution reinvestment plan to participate in the Company's
distribution reinvestment plan to the extent that its unitholders participate in
the WAT distribution reinvestment plan. The Company also understands that
Westfield Holdings intends to participate in WAT's distribution reinvestment
plan to the full extent of distributions on its units in WAT for a three-year
period commencing with the first distribution period for which reinvestment is
permitted. No assurances can be given that WAT will in fact adopt a distribution
reinvestment plan, that WAT will participate in the Company's distribution
reinvestment plan, and that Westfield Holdings will choose not to participate in
WAT's distribution reinvestment plan in the future.

CONFLICTS OF INTEREST WITH OUTSIDE PARTNERS IN JOINTLY-OWNED
CENTERS AND LIMITED CONTROL WITH RESPECT TO CERTAIN ACTIVITIES

Eight of the Centers (and certain other properties) are owned by Joint
Ventures consisting of the Company and one or more Outside Partners who own
interests from 24% to 70% of the Joint Ventures, although with respect to
Annapolis Mall, the Company has entered into a letter of intent with its Joint
Venture partner to acquire the remaining 70% interest in Annapolis Mall and
certain adjoining real property for $133.0 million. Although the Company
currently owns less than a 50% interest in four of the Centers, three are
managed by Westfield Holdings. In addition, the Company is a limited partner in
the Joint Venture which owns North County Fair (which is not managed by
Westfield Holdings), and is one of two general partners in four Joint Ventures
(Annapolis Mall, Meriden Square, Topanga Plaza and Vancouver Mall) and,
therefore, has limited control regarding the operation and management of the
Centers owned by such Joint Venture. With respect to partnerships for which the
Company serves as general partner, the Company may have certain fiduciary
responsibilities to other partners in those partnerships which it will need to
consider when making decisions that affect those properties owned by such Joint
Ventures. As a result, potential conflicts and other problems, certain of which
are summarized below, could arise as a consequence of these ownership
arrangements.

The sale or transfer of interests in some of the Joint Ventures is subject
to buy-sell provisions or rights of first refusal or first offer. A right of
first refusal generally requires a partner desiring to sell its interests to a
third party to offer the interest first to the other partner on the same terms
and conditions offered by the third party. A right of first offer generally
requires a partner that does not yet have a third-party offer (but that desires
to sell its interest) to first offer the partnership interest to the other
partner for a specified price. If the other partner declines to purchase, the
offering partner may then attempt to sell its interest to a third party on terms
not materially less favorable to the offering partner than those offered to its
partner. A buy-sell provision generally allows either partner to initiate a
process that will result in one of the partners purchasing the other partner's
interest. The initiating partner specifies the price at which it would be
willing to sell its interest or purchase its partner's interest, and the other
partner elects whether to sell or buy at the specified price. These provisions
and rights may work to the advantage or disadvantage of the Company because,
among other things, they may provide an opportunity to acquire the interests of
the Outside Partners on advantageous terms or require the Company to make
decisions as to the purchase or sale of interests in a Joint Venture at a time
when the Company may not desire to sell but may be forced to do so because it
does not have the cash to purchase the other party's interest.

In addition, the consent of each Outside Partner could be required with
respect to certain major transactions, such as refinancing, encumbering,
expanding or selling a Property and with respect to a Joint Venture's
distribution policies. The interest of the Outside Partners and those of the
Company are not

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necessarily aligned in connection with the resolution of such issues.
Accordingly, the Company may not be able to resolve any such issue favorably, or
the Company may have to provide financial or other inducement to the Outside
Partner to obtain such a resolution. These limitations may result in decisions
by third parties with respect to such Properties that do not fully reflect the
interests of the Company at such time, including decisions relating to the
requirements with which the Company must comply in order to maintain its status
as a REIT for tax purposes. The Company will be contractually restricted from
selling certain of these Properties after the closing of the Offerings without
the consent of unrelated parties. These limitations on sale may adversely affect
the Company's ability to sell these Properties at the most advantageous time for
the Company.

Since the Company is only a limited partner in the partnership that owns
North County Fair and the Center is not managed by Westfield Holdings, the
Company has presented its financial data in this Prospectus on a basis that both
includes and excludes the results of North County Fair to differentiate between
Centers managed by Westfield Holdings and North County Fair that is managed by a
third party.

For a more detailed description of the Joint Ventures, see "Business and
Properties--The Centers."

BANKRUPTCY OF OUTSIDE PARTNERS

The bankruptcy of an Outside Partner could adversely affect the operation of
any Property in which the Outside Partner held an interest. Under the Bankruptcy
Code, any action by the debtor that is not in the ordinary course of its
business requires bankruptcy court approval, which in turn generally requires
prior notice to the debtor's creditors and a hearing in court. Thus, any action
that requires approval of an Outside Partner in bankruptcy and is arguably not
an "ordinary course" matter may be subject to delay and uncertainty while the
Outside Partner seeks bankruptcy court approval. There can be no assurance that
such approval would be obtained, particularly in cases in which the interests of
the Outside Partner and the Company may conflict, or where additional funding
from the Outside Partner is required. If a Joint Venture has incurred recourse
obligations, the discharge in bankruptcy of an Outside Partner might result in
the ultimate liability of the Company for a greater portion of such obligations
than it would otherwise bear. In addition, even if the Outside Partner (or its
estate) was not completely relieved of liability for such obligations, the
Company might be required to satisfy such obligations and then rely upon a claim
against the Outside Partner's estate for reimbursement.

EFFECT OF UNINSURED LOSS ON PROFITABILITY

The Company's subsidiaries, the Joint Ventures and the Company carry
comprehensive liability, fire, extended coverage and rental loss insurance
covering the Properties, with policy specifications and insured limits
customarily carried for similar properties. There are, however, certain types of
losses (such as from wars, floods and earthquakes) that are generally either not
insured, not insured at full replacement cost or insured subject to larger
deductibles. Should an uninsured loss or a loss in excess of insured limits
occur, some or all of the capital invested in the Property, as well as the
anticipated future revenues from the Property, could be lost, while the Property
owner remains obligated for any mortgage indebtedness or other financial
obligations related to the Property. Any such loss could materially adversely
affect the Company. Moreover, wherever the Company is a general partner of the
Joint Venture, the Company will generally be liable for any unsatisfied
obligations of such Joint Ventures other than nonrecourse obligations. The
Company believes that the Properties are adequately insured in accordance with
industry standards. Many of the Properties are located in areas where the risk
of earthquakes is greater than in other parts of the country, including nine
Centers in California. The Company currently carries earthquake insurance on all
Centers managed by Westfield Holdings. Such policies are subject to a deductible
equal to 5% of the total insured value of each Center managed by Westfield
Holdings and a combined annual aggregate loss limit of $100 million on the
Centers.

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POSSIBLE ENVIRONMENTAL LIABILITIES

Under various federal, state and local environmental laws, ordinances and
regulations, a current or previous owner or operator of real property may be
liable for the costs of releases, including removal or remediation, of hazardous
or toxic materials on, under, in, or from such property. Such laws often impose
liability whether or not the owner or operator knew of, or was responsible for,
the presence or release of such hazardous or toxic materials. The presence of
hazardous or toxic materials, or the failure to remediate such property
properly, may adversely affect the owner's ability to sell such property or to
borrow using such property as collateral, and may cause the property owner to
incur substantial cleanup costs. Persons who arrange for the disposal or
treatment of hazardous or toxic materials may also be liable for the costs of
removal or remediation at the disposal or treatment facility to which such
materials were sent. Certain other laws regulate the management of, and may
impose liability for, personal injuries associated with exposure to
asbestos-containing materials or other regulated materials. In addition, if any
of the Centers undergoes renovation or demolition in the future, the Company may
incur substantial costs for the removal and disposal of such materials.

In connection with its ownership and operation of its currently and
formerly-owned properties, the Company and the Joint Ventures may be potentially
liable for removal or remediation costs, as well as certain other costs,
including governmental fines and costs related to injuries to persons and
property, resulting from environmental conditions at such properties. An
independent consultant has reviewed certain existing environmental reports,
including "Phase I" site assessments (which generally include a visual site
inspection, interviews and a records review) of the Centers, to identify
environmental conditions at the Centers and certain formerly-owned properties.
The environmental reports were prepared in 1993 for all of the Centers other
than the Acquired Properties and in 1996 for the Acquired Properties. Although
all of the environmental reports were made available to the Company, a majority
of the reports were prepared for parties other than the Company and the Company
does not have recourse against the preparer of such reports in the event such
reports are inaccurate. The Company has from time to time commissioned
additional or follow-up investigations by various outside consultants. There can
be no assurance, however, that circumstances have not changed since any
investigations were completed, that they reveal all potential environmental
liabilities and obligations or are accurate, or that prior owners or operators
of the properties have not created a potential environmental liability unknown
to the Company. On the basis of the foregoing investigations and the Company's
knowledge of the operation of the Properties, the Company believes that many of
the Centers and properties formerly owned by the Company contain or historically
contained petroleum storage tanks and included automobile service operations,
and that such operations have, or may have, resulted in soil or groundwater
contamination. Further, the Company is aware of asbestos containing materials in
each of the Centers and in at least some of the formerly owned properties.

Although there can be no assurances, the Company does not believe that
environmental conditions at any of the Properties will have a material adverse
effect on the Company's business, financial condition or results of operations.
There can be no assurance that environmental laws and regulations will not
become more stringent in the future or that the environmental conditions on or
near the Properties, presently known or unknown, will not have a material
adverse effect on individual Properties or the Company in the future. See
"Business and Properties--Environmental Matters."

LACK OF INDEPENDENT VALUATION OF THE COMPANY

No appraisals, or independent valuation or fairness opinions from a
financial point of view of the Properties have been used by the Company in
connection with the Offerings. Furthermore, the valuation of the Company is not
based upon the historical cost of assets or the current market value thereof.
Accordingly, the aggregate price of the Common Stock may exceed the aggregate
fair market value of the Properties. For a discussion of the factors considered
in determining the initial public offering price, see "Underwriting."

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ABSENCE OF PUBLIC MARKET; POSSIBLE VOLATILITY OF STOCK PRICE

Prior to the Offerings, there has been no public market for the shares of
Common Stock. The Common Stock has been approved for listing on the NYSE,
subject to official notice of issuance, under the symbol "WEA;" however, no
assurance can be given that an active trading market for the Shares will develop
or be sustained after the Offerings or that the Shares may be resold at or above
the initial public offering price. See "Description of Capital Stock--Listing."
The market for equity securities can be volatile and the trading price of the
Shares could be subject to wide fluctuations in response to operating results,
news announcements, trading volume, general market trends and other factors. The
initial public offering price of the Shares was determined based on, among other
factors, prevailing market conditions in the equity securities market, the price
at which WAT units have been trading on the ASX, dividend yields, price-earnings
and price-Funds from Operations ratios of publicly traded REITS that the Company
and the underwriters believe to be comparable to the Company, an assessment of
the recent results on operations of the Company (which are based on the results
of operations of the Properties), estimates of the future prospects of the
Company, the present state of the Company's development projects, the current
state of the real estate markets in the geographic areas in which the Company
operates and the economics of the Company's principal markets as a whole. See
"Underwriting." One of the factors that may influence the price of the shares of
Common Stock in public markets will be the annual distribution rate on such
shares as compared with the yields on alternative investments. Any significant
increase in market interest rates from their current low levels could lead
holders of Common Stock to seek higher yields through other investments, which
could adversely affect the market price of the Common Stock. Moreover, numerous
other factors, such as governmental regulatory action and tax laws, as well as
the number of shares available for future sale, could have a significant impact
on the future market price of the shares of Common Stock. The public market
price for WAT units on the ASX could adversely affect the prevailing market
price of the shares of Common Stock. WAT's distribution policy may differ from
the Company's distribution policy for the Common Stock.

POSSIBLE ADVERSE EFFECTS ON STOCK PRICES ARISING FROM SHARES AVAILABLE FOR
FUTURE SALE

Upon consummation of the Offerings and concurrent transactions, in addition
to the shares of Common Stock to be issued in connection with the Offerings,
52,929,535 shares of Common Stock will be outstanding. In addition WAT will
continue to hold the 1996 WAT Warrant entitling it to purchase 6,246,096 shares
of Common Stock, in whole or in part, at any time and from time to time prior to
July 1, 2016, at an exercise price of $16.01 per share, subject to adjustment in
certain events, and will purchase the 1997 WAT Warrant entitling it to purchase
2,089,552 shares of Common Stock, in whole or in part, at any time and from time
to time prior to May 21, 2017, at an exercise price equal to the initial public
offering price for the Shares. See "Certain Transactions--Relationships and
Transactions with WAT" and "Principal Shareholders."

All of the Shares sold in the Offerings will be freely tradeable by persons
other than "affiliates" of the Company without restriction under the Securities
Act, subject to the limitations on ownership set forth in the Articles. There
are 52,055,082 shares of outstanding Common Stock currently held by WAT,
Westfield Holdings and certain other existing shareholders, as well as shares
issuable upon exercise of the WAT Warrants, which will be "restricted"
securities within the meaning of Rule 144 promulgated under the Securities Act
and may not be sold in the absence of registration under the Securities Act or
unless an exemption from the registration is available, including exemptions
contained in Rule 144. Certain of those shares (as well as the Shares to be
acquired by Westfield Holdings and other affiliates under the Orders) may become
eligible for sale in the public market 90 days after the effective date of this
Registration Statement of which this Prospectus is a part, subject to compliance
with the volume limitations under Rule 144. See "Shares Available for Future
Sale." Westfield Holdings will have certain demand rights to register sales of
the 10,930,672 shares of Common Stock held by Westfield Holdings prior to
consumation of the Offerings 36 months after the date of closing of the
Offerings. It will also have certain demand rights to register sales of any
other shares of Common Stock 90 days after the date of closing of the Offerings.
See "Shares Available for Future Sale--Registration Rights."

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The Company, Westfield Holdings, interests associated with the Lowy family
and Richard E. Green, a Co-President of the Company, will each agree, subject to
certain exceptions (including the exercise of the WAT Warrants and the
concurrent transactions) not to (i) sell, grant any option, right or warrant for
the sale of, or to purchase or otherwise transfer or dispose of any Common Stock
or securities convertible into or exchangeable or exercisable for Common Stock
or file a registration statement under the Securities Act with respect to the
foregoing or (ii) enter into any swap or other agreement or transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, for a period of 90 days from the date of this
Prospectus in the case of the Company and any Shares which may be acquired under
the Orders and 36 months from the date of this Prospectus in the case of shares
held by Westfield Holdings immediately prior to consummation of the Offerings,
without the prior written consent of Merrill Lynch.

No prediction can be made as to the effect, if any, that future sales of
shares of Common Stock, the availability of shares of Common Stock for future
sale, or future issuances of shares including upon the exercise of the WAT
Warrants will have on the market price of the Common Stock prevailing from time
to time. Sales of substantial numbers of shares of Common Stock, or the
perception that such sales could occur, could adversely affect the prevailing
market price for the Common Stock. If such sales reduce the market price of the
Common Stock, the Company's ability to raise additional capital in the equity
markets could be adversely affected. The existence of the WAT Warrants and the
registration rights referred to above also may adversely affect the terms upon
which the Company can obtain additional equity in the future. See "Shares
Available For Future Sale" and "Underwriting."

CHANGES IN POLICY WITHOUT SHAREHOLDER APPROVAL

The major policies of the Company, including its policies with respect to
acquisitions, financing, growth, investments, debt capitalization, distributions
and operating policies, will be determined by the Board of Directors. Although
it has no current intention of doing so, the Board of Directors may amend or
rescind these and other policies from time to time without a vote of the
shareholders of the Company. Accordingly, shareholders will have no control over
changes in policies of the Company, and changes in the Company's policies may
not fully serve the interests of all shareholders.

FORWARD-LOOKING STATEMENTS

This Prospectus contains forward-looking statements. Discussions containing
such forward-looking statements may be found in the material set forth under
"Prospectus Summary," "The Company," "Capitalization," "Management's Discussion
and Analysis of Financial Condition and Results of Operations," and "Business
and Properties," as well as within the Prospectus generally. Such statements are
subject to a number of risks and uncertainties. Actual results in the future
could differ materially from those described in the forward-looking statements
as a result of the risk factors set forth above and the matters set forth in the
Prospectus generally.

IMMEDIATE DILUTION

The pro forma net tangible book value per share of the Company's assets
after the Offerings and concurrent transactions is lower than the initial public
offering price per Share in the Offerings. Accordingly, the purchasers of Shares
will experience an immediate dilution of $5.50 per share in the net tangible
book value of the Shares. See "Dilution."

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THE COMPANY

GENERAL

The Centers contain approximately 19.2 million square feet of Total GLA,
including 74 Anchors and approximately 2,500 Mall Stores, of which approximately
1.3 million square feet are currently under redevelopment and approximately 3.2
million square feet are planned for redevelopment over the next five years. For
the year ended December 31, 1996, the Mall Stores reported sales exceeding $1.5
billion and Anchors reported sales exceeding $2.0 billion. The Centers under
Westfield Holdings management reported average Mall Store sales of $297 psf for
the same period ($300 psf, including North County Fair for the same period).
Mall GLA at Stabilized Centers was 92% leased as of December 31, 1996 (91%
leased, including North County Fair).

Since 1994, subsidiaries of Westfield Holdings Limited have provided
management, development and advisory services to the Company. The Company has no
employees and relies solely on Westfield Holdings for management services.
Subject to the discretion and approval of the Board of Directors of the Company,
the Company's strategic policy will be determined by Westfield Holdings and
possible conflicts of interest may exist between the Company, Westfield Holdings
and, by virtue of its ability to significantly influence Westfield Holdings
Limited, the Lowy family. In addition, based on Westfield Holdings's ownership
interest in the Company and its management of WAT, the purchasers of the Shares
may not be able to change the composition of the management of the Company
through a vote of shareholders. See "Risk Factors--Possible Conflicts of
Interests with Inside Parties and Related Party Transactions" for a discussion
of possible conflicts.

The Company has achieved substantial growth since 1994 when Westfield
Holdings began advising the Company and providing management services to its
Centers. For the Mall Stores under Westfield Holdings management (excluding the
recently redeveloped Eastland Center), from 1994 to 1996, average base rent per
square foot at the Centers increased at a compound annual rate of approximately
4.5% (4.2%, including North County Fair), sales per square foot at the Centers
increased at a compound annual rate of 6.3% (6.2%, including North County Fair)
and leased Mall GLA at Stabilized Centers improved from 88% leased to 92% leased
(88% to 91%, including North County Fair).

The management and leasing of the Company's super regional and regional
shopping centers and power centers are conducted by a partnership wholly-owned
by Westfield Holdings which receives a property management fee from the Company
equal to 5% of all minimum, fixed and percentage rents payable with respect to
the wholly-owned Centers, with fees payable with respect to Joint Venture
Centers based on the terms of the Joint Venture agreements (subject to a cap of
5% on the Company's share of such payments). Westfield Holdings also provides
advisory services to the Company through the Advisor, which will receive an
annual advisory fee based on the annual Funds from Operations of the Company but
shall not exceed 55 basis points on the net equity value of the Company's
assets. The advisory fee is not payable for the period through December 31,
1997. Design, architectural, engineering and development services are provided
by a wholly-owned subsidiary of Westfield Holdings Limited for which it receives
a fixed architectural and engineering fee equal to 10% of the construction costs
plus a fixed development fee equal to 5% of the final gross project price. For a
more detailed description of Westfield Holdings's managing role including
further information on fees payable to Westfield Holdings for its services, see
"Advisory, Management and Development Services to the Company."

The principal executive offices of the Company are located at 11601 Wilshire
Boulevard, 12th Floor, Los Angeles, California 90025 (telephone: 310-478-4456).
The headquarters for each of the Manager, Advisor and Developer are located at
the same address in Los Angeles, California.

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COMPANY STRUCTURE AND HISTORY

The Company was incorporated in 1924 for the purpose of holding title to
certain department store properties and has been involved in developing shopping
centers since the mid 1950's. In 1994, Prudential sold 40% of the Company to
Westfield Holdings and the remainder to certain other investors, after
Prudential had filed a registration statement for the initial public offering of
common stock of the Company to the public but before marketing of the securities
commenced or such registration statement was declared effective. In 1995,
Westfield Holdings acquired an additional 10% of the Company. In 1996 and early
1997, the Company was recapitalized when WAT acquired 74.6% of the outstanding
Common Stock and the 1996 WAT Warrant. In addition the Company sold $134.0
million of non-voting preferred stock and Common Stock to foreign and U.S.
investors (inclusive of a $14.0 million investment that certain of the then
existing investors agreed to retain in the Company). The Company utilized a
portion of the proceeds of the sale of its Common Stock and non-voting preferred
stock to repurchase the stock of certain investors other than Westfield
Holdings.

Contemporaneously with these restructuring transactions, the Company
acquired indirect ownership of the Acquired Properties from interests associated
with the Lowy family and an option to acquire the stock of Westland Realty,
Inc., the holder of an indirect 50% interest in Garden State Plaza from
Westfield Holdings. For more information on the Garden State Plaza Option and
the transactions referred to above, see "The Company--The Company's Strategy for
Operations and Growth--Garden State Plaza Option" and "Certain
Transactions--Relationships and Transactions with Westfield Holdings."

As part of the Recapitalization, ABP acquired an equity interest in the
Company through the purchase of 940,000 shares of Series A Preferred Shares,
with an aggregate liquidation value of $94.0 million. ABP has agreed to acquire,
subject to the satisfaction of certain conditions, an additional equity interest
in the Company by purchasing 270,000 shares of Series B Preferred Shares, with
an aggregate liquidation amount of $27.0 million simultaneously with the closing
of the Offerings. Although the Company expects all of the conditions to the sale
of the Series B Preferred Shares will be satisfied, no assurance can be given in
this regard. ABP also holds options issued by WAT that permit ABP to acquire
units of WAT for cash or in exchange for Series A Preferred Shares. In
connection with the acquisition of the Series B Preferred Shares, ABP has also
agreed to acquire additional options issued by WAT that will permit ABP to
acquire additional units of WAT for cash or in exchange for Series B Preferred
Shares.

Also simultaneously with the closing of the Offerings, WAT will acquire a
warrant (the "1997 WAT Warrant", and together with the 1996 WAT Warrant, the
"WAT Warrants") to purchase 2,089,552 shares of additional Common Stock from the
Company at the same price as the initial public offering price for the Shares.
The purchase price for the 1997 WAT Warrant is $2.6 million.

As a result of these transactions and after giving effect to the Offerings
and concurrent transactions and taking account of the number of Shares to be
acquired under the Orders, WAT will own 62.4%, and Westfield Holdings will own
16.7% (31.7% including its indirect interest through WAT), of the outstanding
Common Stock on a fully-diluted basis. Westfield Holdings will also hold an
approximately 24.0% equity interest in WAT on a fully diluted basis. In
addition, ABP will have an approximately $121.0 million investment in the
Company through the ownership of the Preferred Stock. See "Principal
Shareholders."

Following the consummation of the Offerings and prior to January 1, 1998,
the Company intends to form an operating partnership (the "Operating
Partnership"). The Company will be the sole general partner of and initially own
100% of the Operating Partnership. The Company intends to transfer substantially
all of its assets and liabilities to the Operating Partnership or to subsidiary
property partnerships or limited liability companies wholly-owned by the
Operating Partnership. The Company expects the Operating Partnership will
thereafter be the entity through which the Company conducts substantially all of
its operations. Westfield Holdings will provide advisory services to the
Operating Partnership pursuant to the Advisory Agreement. As a result of such
transfer of the Properties to the Operating Partnership, the Company does not
expect to incur any material transfer or other taxes. The transfer of assets and
liabilities will be accounted for at historical amounts and will not impact the
Company's consolidated financial statements.

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WESTFIELD HOLDINGS

Westfield Holdings is a fully-integrated, international developer, builder
and manager of shopping centers and manager and advisor to public real estate
investment entities. Westfield Holdings has its headquarters in Sydney,
Australia and employed approximately 2,400 people worldwide as of December 31,
1996. Westfield Holdings, which was publicly listed in 1960, was co-founded by
Frank P. Lowy. In 1993, Frank P. Lowy was acknowledged as one of the six
"pioneers" of the shopping center industry worldwide by the ICSC. By combining
financial strength and over 35 years of experience with a business philosophy
that stresses innovation, Westfield Holdings has built a successful shopping
center business, with shopping center assets under management having a value in
excess of Aus.$10.0 billion as of December 31, 1996, comprised of more than
8,500 retail stores in 56 centers in the United States, Australia and Asia, with
39.3 million square feet of total gross leasable area.

Westfield Holdings Limited, listed on the ASX, had a market capitalization
of approximately Aus.$2.5 billion as of May 9, 1997. Westfield Holdings is also
a manager and advisor to real estate investment entities, Westfield Trust and
WAT, both of which are Australian public property trusts traded on the ASX.
Based on its market capitalization of approximately Aus.$3.1 billion as of May
9, 1997, Westfield Trust is one of the two largest property trusts in Australia.

The Company believes that Westfield Holdings's success stems from its
integrated approach to all disciplines required to conceive, build and then
manage a modern retail development on behalf of its owners. The Company believes
it is this integration across all operating divisions and Westfield Holdings's
intense involvement in key aspects of the centers it manages that makes
Westfield Holdings unique. Westfield Holdings's development expertise includes
establishing the feasibility of the projects, securing development approvals,
producing architectural designs and performing and supervising construction.
Westfield Holdings also arranges the ongoing leasing program and installs and
operates management and marketing systems to ensure that a center achieves its
full potential. This in-house integrated approach to shopping center
development, management and leasing enhances Westfield Holdings's ability to
carry out major redevelopment and upgrading of centers.

Since 1977, Westfield Holdings's U.S. business has included the
redevelopment and expansion of 11 shopping centers in California, Connecticut,
Michigan, Missouri, New Jersey and New York. Westfield Holdings's U.S. business
currently manages and provides development services to 26 shopping centers (two
of which are owned by subsidiaries of Prudential, one of which is owned by a
real estate investment fund managed by Heitman/JMB Advisory Corporation and the
third of which is owned by a real estate investment fund managed by Goldman,
Sachs & Co.) with more than 24.5 million square feet of total gross leasable
area, including the Centers and Garden State Plaza as well as the retail
facilities at Dulles and National Airports in Washington, D.C. and Terminal C at
Logan Airport in Boston, Massachusetts. Westfield Holdings's U.S. operations are
headquartered in Los Angeles, California, and employ approximately 950 people in
the United States. Westfield Holdings's senior management team has extensive
experience in the development, construction, management and financing of super
regional and regional shopping centers, with an average of approximately 20
years in the industry. Westfield Holdings derived approximately 41% of its U.S.
management, advisory and development revenues from the Company in 1996.
Westfield Holdings has advised the Company that it expects the amount of its
U.S. business attributable to the Company to substantially increase upon
completion of the redevelopment of Garden State Plaza in 1997 from which it
received substantial development revenue in 1996.

The Company has access to and relies upon the resources and depth of the
management of Westfield Holdings's worldwide operations. Westfield Holdings
provides a full range of services to the Company including many which are
typically outsourced by real estate owners to third parties. These services
include strategic and day-to-day management, research investment analysis,
acquisition and due diligence, development, construction, architectural advice,
marketing, asset management, capital markets, disposition of asset, legal and
accounting services. In contrast to many other shopping center companies, the
Company is not exposed to the same degree of risk of increasing costs for many
of these services because the fees payable to the Manager and the Advisor are
incentive based or fixed as a percentage of assets or revenues. For a fuller
description of Westfield Holdings's management arrangements with the Company,
including

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<PAGE>
fees payable to Westfield Holdings for its services, see "Advisory, Management
and Development Services to the Company."

Westfield Holdings will agree that it will not acquire any ownership
interest in shopping center properties or power centers in the United States for
so long as it is the Advisor to the Company and the Manager of the Centers. Each
of Frank Lowy, David Lowy, Peter Lowy and Steven Lowy will agree with the
Company that he will not acquire any ownership interest in shopping center
properties or power centers in the United States for so long as (i) Westfield
Holdings is the Advisor to the Company and Manager of the Centers and (ii)
interests associated with the Lowy family have significant ownership and
significant management involvement in the operations of Westfield Holdings
Limited. In addition, Westfield Holdings has agreed in its management and
development agreements with the Company that it will not manage or develop any
shopping center in competition with a Center owned by the Company, except in the
case of the acquisition by Westfield Holdings of an entity that does not have
any ownership interest in any shopping center properties or power centers in the
United States and is then managing or developing a competitive property (in
addition to other properties). This non-competition agreement shall not apply to
any activity by Westfield Holdings with respect to airport projects.

Contemporaneously with the Offerings, the Company will purchase from
Westfield Holdings Limited for an aggregate purchase price of $15.3 million
(Aus.$19.6 million) the non-transferable Westfield Holdings Warrants to acquire
9.8 million ordinary shares of Westfield Holdings Limited, which would be as of
the date hereof equal to approximately 9% of the ordinary shares of Westfield
Holdings Limited outstanding after the exercise of the options. The term of the
Westfield Holdings Warrants is five years but will be seven years if Australian
law is changed to permit such longer term. The Westfield Holdings Warrants may
be exercised in whole or in part following the third anniversary of the grant of
the Westfield Holdings Warrant. Each Westfield Holdings Warrant will have an
exercise price equal to the weighted average of the sale prices of ordinary
shares of Westfield Holdings Limited on the ASX for the 20 business days
immediately preceding the consummation of the Offerings and, subject to certain
anti-dilution adjustments, will entitle the Company to receive one ordinary
share of Westfield Holdings Limited. In addition, the Company has the right to
elect to exercise the option without a cash payment, in which event the Company
would be entitled to receive, at the option of Westfield Holdings Limited,
either the number of Westfield Holdings Limited ordinary shares equal in value
to, or cash in an amount equal to, the amount by which the then market price of
the ordinary shares of Westfield Holdings Limited exceeds the exercise price of
such options. For these purposes, the market price of an ordinary share of
Westfield Holdings Limited will be equal to the weighted average of the sale
prices of such shares on the ASX for the 20 business days immediately preceding
the exercise date. On May 15, 1997, the closing sale price on the ASX of the
Westfield Holdings Limited ordinary shares was Aus.$23.00. Westfield Holdings
Limited is an independent company from the Company and, except for the Company's
interest in the Westfield Holdings Warrants, the purchasers of the Shares will
not acquire any interest in Westfield Holdings.

Prior to 1988, Westfield Holdings Limited indirectly owned seven regional
shopping centers located in the United States. In 1988, Westfield Holdings
Limited distributed to its existing shareholders (approximately 42% of whom were
interests associated with the Lowy family) the stock of the foreign corporation
that indirectly owned the seven shopping centers. The stock was listed on the
ASX and the London stock exchange and no capital was raised in conjunction with
the listing. The foreign corporation was self-administered, self-managed and had
its own employees. The foreign corporation was not advised by Westfield Holdings
in connection with its business operations in the United States. Westfield
Holdings coordinated certain Australian shareholder and London stock exchange
and ASX regulatory and listing matters for the foreign corporation pursuant to a
services agreement under which Westfield Holdings received compensation and
reimbursement of expenses aggregating approximately $350,000 for the period the
foreign corporation was publicly listed. In 1989, interests associated with the
Lowy family made a cash tender offer of $3.35 per share. Although the seven
centers were not offered for sale, the purchase price exceeded the highest price
at which the shares had traded during the corporation's public trading history
and represented a 46% premium over the highest price during the week before the
offer was made. After taking into account all liabilities, including tax
liabilities, that would have been payable prior to the distribution of the net
assets to the shareholders, the purchase price exceeded the net asset value by

40
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approximately 35%. The per share purchase price without regard to tax liability
on account of a sale of the assets was less than the net asset value per share
by approximately 35%. The offer was conditioned on the tender of at least 90% of
the shares of the foreign corporation. Three of the seven properties were
acquired by the Company from interests associated with the Lowy family in
connection with the Recapitalization. See "Certain Transactions." Garden State
Plaza, which was also one of the seven properties, was sold to Westfield
Holdings and affiliates of Rodamco North America B.V., an unrelated party, in
1993. The other three centers were encumbered by participating mortgages in 1988
and 1989 and were conveyed to affiliates of the lenders in 1995 and 1996. The
three centers were conveyed in two separate transactions for consideration in
excess of the outstanding debt, with one of the centers conveyed on the
condition that Westfield Holdings continue to manage the center for two years.

WAT is an Australian public property trust which was formed to acquire a
majority interest in the Company and was listed on the ASX in July 1996 when it
raised approximately Aus.$402 million. WAT had a market capitalization as of May
9, 1997 of approximately Aus.$853 million. WAT is managed by Westfield America
Management Limited, a wholly-owned subsidiary of Westfield Holdings Limited.
Perpetual Trustee Company Limited is the independent public trustee of WAT. The
Company believes that in the future WAT may be able to raise additional funds in
the Australian capital markets which it may elect to invest in the Company if
the Company elects to raise additional equity capital, thereby providing to the
Company an additional source of capital.

Westfield Holdings has placed an order to purchase up to 2,300,000 Shares at
the price to public and will continue to own a significant stake in the Company.
The following table demonstrates the Common Stock ownership of Westfield
Holdings in the Company on a fully-diluted basis upon consummation of the
Offerings and concurrent transactions and taking account of the Shares to be
acquired under the Orders (for a description of concurrent transactions, see
"Use of Proceeds" and "Pro Forma Condensed Consolidated Financial Information").
See "Principal Shareholders."

<TABLE>
<S> <C>
Direct ownership of the Company....................................... 16.7%
Indirect ownership through direct ownership of WAT units.............. 15.0%
---
Total............................................................... 31.7%
---
---
</TABLE>

<TABLE>
<S> <C>
Direct ownership of the Company....................................... 0.8%
Indirect ownership through direct ownership of Westfield Holdings..... 13.9%
Indirect ownership through direct ownership of WAT units.............. 4.4%
---
Total............................................................... 19.1%
---
---
</TABLE>

THE COMPANY'S STRATEGY FOR OPERATIONS AND GROWTH

GENERAL STRATEGY

The Company's goal is to increase per share Funds from Operations and
thereby maximize the long-term value of the Company and the return to
shareholders through the following key strategies: (i) the redevelopment,
expansion and market repositioning of its current Centers, (ii) the acquisition
of additional super regional and regional shopping centers with a view towards
increasing the value of such centers through redevelopment, expansion and
repositioning, (iii) the improvement of the operating performance of its
properties through intensive and efficient management, cost control, leasing and
marketing and (iv) the awareness and anticipation of trends in the retailing
industry and the introduction of new retailing concepts to its properties.

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<PAGE>
The Company has engaged subsidiaries of Westfield Holdings Limited to
provide management and advisory services to the Company and the Centers and to
provide property management and architectural, design, engineering and
development services to the Properties. The Company believes that Westfield
Holdings, as a fully integrated, international developer, builder and manager of
shopping centers with a history as a manager and advisor of public real estate
investment entities, and with substantial experience in the U.S. market,
possesses the skills and expertise to execute successfully the Company's
strategy and enhance the income and value of the Company's portfolio.

REDEVELOPMENT, REPOSITIONING AND EXPANSION POTENTIAL AND IMPLEMENTATION

The Company believes that redevelopment, repositioning and expansion are key
to maximizing the use and performance of its assets and increasing its income
growth and capital appreciation. The Company is continually evaluating the
redevelopment potential of its Properties and anticipates that it will pursue
opportunities for substantial redevelopment and repositioning at the Properties.
The Company believes that redevelopment is important because of the financial
and regulatory burdens presented by the development of new regional shopping
centers. The Company believes that these projects will enable the existing
Centers both to compete better within their existing markets and to attract new
customers and therefore attain a stronger market position and an expanded
customer base. The Company believes that most of its Centers, even those which
have undergone redevelopment in the past five years, have continuing
redevelopment potential. The Company also believes that Westfield Holdings is
well situated to take advantage of these opportunities, due to, among other
things, its management expertise and its ability to utilize operating staff,
ideas and systems from its operations in the United States, Australia and Asia.

Since 1994, the Company has completed or substantially completed the
redevelopment of five Centers, representing 25.4% of Total GLA.

Redevelopment has recently been completed or substantially completed at the
following Centers:

- Eastland Center in West Covina, California, which opened in 1955 and was
formerly anchored by Mervyn's and an empty department store that had been
occupied by the May Company, has been substantially converted from an
out-dated enclosed mall into a power center through the addition of a new
Target discount store and additional Big Box Retailers and Category
Killers retailers, including Old Navy and Babies R' Us in order to
reposition the Center within its trade area and to complement The Plaza at
West Covina, a super regional shopping center owned by the Company. The
May Company store that occupied the space was relocated to The Plaza at
West Covina. The redevelopment is scheduled to be completed in Spring
1997.

- Enfield Square in Enfield, Connecticut, which opened in 1971, was
redeveloped with the addition of a Sears store which is scheduled to open
in Spring 1997. The Sears store replaces a smaller Steiger's store which
the Company purchased as an opportunity to upgrade and expand the Center.
Enfield Square will now have three Anchors: Filene's, J.C. Penney and
Sears.

- Mid Rivers Mall in St. Peters, Missouri, which opened in 1987, had three
Anchors before the recent redevelopment: Famous Barr, Dillard's and Sears.
In Fall 1996, a fourth Anchor, a 125,000 square-foot J.C. Penney store and
an additional 40,000 square feet of Mall GLA were added.

- Mission Valley Center in San Diego, California, which opened in 1961, was
redeveloped in 1996 with the addition of Bed Bath and Beyond, Nordstom
Rack, Michael's and Loehmann's. In addition, a 75,000 square-foot, 4,500
seat, 20 screen AMC theater and theme restaurants were added. The
redevelopment and renovation is scheduled to be completed in the first
half of 1997.

The Company is currently redeveloping South Shore Mall in Bay Shore, New
York. The redevelopment involves the addition of a Sears store and 40,000 square
feet of Mall GLA. The addition of a Sears store will provide the Center with
three Anchors and expands the Center from a regional shopping center to a super
regional shopping center. Project completion is scheduled for Fall 1997.

The Company expects to commence redevelopment of Mission Valley Center-West
in Fall 1997. Mission Valley Center-West, in San Diego, California, has 34 Mall
Stores in a strip center format with several outparcels adjacent to the Center.
The redevelopment plan involves the creation of a new power center with
value-oriented retailers that will complement Mission Valley Center.

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In addition to the redevelopment of Mission Valley Center-West, the Company
has identified the following eight additional Properties for redevelopment over
the next five years which the Company believes will result in future income
growth and capital appreciation.

- Annapolis Mall in Annapolis, Maryland, is a four-Anchor super regional
shopping center with 151 Mall Stores. Redevelopment planning is proceeding
with the addition of a fifth anchor at the Center, which will further
solidify its strong market position.

- Connecticut Post Mall, in Milford, Connecticut, is a three-Anchor super
regional shopping center with 137 Mall Stores. Redevelopment planning is
proceeding for the addition of up to two anchors and specialty stores in
order to solidify the Center's position in its market.

- Eagle Rock Plaza, located southeast of Glendale, California, is a
two-Anchor regional shopping center with 63 Mall Stores. Redevelopment and
repositioning planning is proceeding and may include an additional anchor
and Category Killer.

- Enfield Square in Enfield, Connecticut is a two-Anchor regional shopping
center with 81 Mall Stores. Redevelopment planning is proceeding for the
addition of a third anchor and an additional 25,000 square feet of Mall
GLA.

- South County Center, in St. Louis, Missouri, is a three-Anchor regional
shopping center with 102 Mall Stores. Redevelopment and renovation
planning is proceeding to reposition the Center through the addition of a
fourth anchor and more than 200,000 square feet of Mall GLA. After
redevelopment, the Company believes that the Center will have a highly
favorable market position within south St. Louis County.

- Topanga Plaza, in Canoga Park, California, is a four-Anchor super regional
shopping center with 130 Mall Stores. Redevelopment planning is proceeding
for the addition of up to two anchors and 100,000 square feet of Mall GLA.

- West County Center, in Des Peres, Missouri is a two-Anchor regional
shopping center with 65 Mall Stores. Redevelopment planning is progressing
to add a third anchor and to redevelop and expand the specialty stores in
order to position the Center as a large competitive super regional
shopping center in the affluent west county market of St. Louis.

- West Valley, in Canoga Park, California, is a property adjacent to Topanga
Plaza that is primarily vacant land with several developed outparcels.
Planning is proceeding to develop a value-oriented power center.

In addition, the Company believes that redevelopment potential exists for
the following Centers and Properties over the next five to 10 years: Meriden
Square in Meriden, Connecticut, with the possibility of an additional 40,000
square feet of Mall GLA and/or another anchor; Trumbull Shopping Park in
Trumbull, Connecticut, with the addition of a third level and increased Mall
GLA; further redevelopment at Annapolis Mall in Annapolis, Maryland, with the
addition of two anchors and additional Mall GLA; Montgomery Mall with two
additional anchors and additional Mall GLA; West Park Mall in Cape Girardeau,
Missouri, with the addition of another anchor; Plaza Bonita in San Diego,
California, with a fifth "pad" for an anchor and additional shops; Plaza Camino
Real in San Diego, California, with the addition of theaters, restaurants or
Category Killers; and Vancouver Mall in Vancouver, Washington, with the possible
expansion of its current department stores to solidify that Center's position
within its market.

The completion of these and other redevelopments is contingent upon numerous
factors and therefore no assurance can be given that a redevelopment will be
undertaken.

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<PAGE>
ACQUISITION OF NEW CENTERS AND JOINT VENTURE INTERESTS

The Company's acquisition strategy is to acquire additional super regional
and regional shopping centers that meet the Company's investment criteria. In
general, the Company's investment criteria includes the goals that the property
be of a quality consistent with the Company's portfolio, that the property has
potential for increased income and value through redevelopment and/or
repositioning and that the property generates sufficient income pending any such
redevelopment to support the acquisition price. The Company's strategy also
includes seeking to acquire the Outside Partners' interests in the Joint Venture
Centers.

The Company has entered into a letter of intent with its Joint Venture
partner, RREEF USA-Fund-III/Annapolis, Inc., to purchase the remaining 70%
interest in Annapolis Mall, together with an adjoining parcel of real property
leased to Montgomery Ward & Co., for an aggregate purchase price of $133.0
million. Although no assurance can be given in this regard and the Annapolis
Acquisition is subject to numerous conditions, the Company expects the Annapolis
Acquisition to close in the second quarter of 1997.

The Company has also entered into an agreement to acquire approximately 70%
of the partnership interests in Wheaton Plaza Regional Shopping Center LLP, the
entity that owns Wheaton Plaza Regional Shopping Center located in Wheaton,
Montgomery County, Maryland for a purchase price of $52.5 million. The enclosed,
one-level center (which a two-level connection to Hecht's), which opened in
1960, has over 1.1 million square feet of total gross leasable area, with 120
mall stores and three anchors: J.C. Penney, Montgomery Ward and Hecht's. The
Wheaton partnership also owns two office buildings of approximately 107,000
square feet and approximately 73,000 square feet. Wheaton Plaza was originally
constructed as an open-air mall and was enclosed in 1981. One of the Company's
principal reasons for making the acquisition is due to the center's
redevelopment potential, although the Company has no immediate plans for
redevelopment. Sales per square foot of $281 were achieved in 1996. As of
December 31, 1996, the center's total gross leasable area was 92% leased.
Consummation of the Wheaton Acquisition is subject to numerous conditions and
there can be no assurance that the acquisition will be consummated.

GARDEN STATE PLAZA OPTION

The Company has an option to acquire at fair market value the stock of
Westland Realty Inc., the holder of an indirect 50% interest in the Garden State
Plaza, located in Paramus, New Jersey. Garden State Plaza is one of the largest
and most productive super regional shopping centers in the nation with five
Anchors and containing approximately 2.0 million square feet of total gross
leasable area and average mall store sales psf of $467 for the year ended
December 31, 1996. Westfield Holdings completed the first part of a major
redevelopment of Garden State Plaza in 1996, adding Lord & Taylor and Neiman
Marcus stores to the existing Macy's and Nordstrom stores and expanding a J.C.
Penney department store. The redevelopment also added 200,000 square feet of
additional mall gross leasable area to connect the two new department stores and
accommodate 100 new specialty retailers. An additional redevelopment of
approximately 50,000 square feet of mall gross leasable area which will provide
direct access from the expansion to the lower level food court is currently in
progress and is scheduled for completion in Fall 1997. The redevelopment,
management and leasing of Garden State Plaza is handled by Westfield Holdings.
For a more detailed description of the Garden State Plaza Option and Loan
Transaction, see "Certain Transactions--Relationships and Transactions with
Westfield Holdings--Garden State Plaza Option."

The Garden State Plaza Option is exercisable following a completion of an
independant valuation of the property to determine its fair market value. The
valuation procedure may be commenced by the Company upon the earliest to occur
of (x) any time after completion and stabilization of the current expansion of
the property, defined to mean the leasing of 95% of the mall gross leasable area
for the expansion, (y) any time after the date which is 18 months after
completion of the current expansion of the property and (z) January 3, 2000, and
in any event no later than 5:00 p.m. (e.s.t.) on January 3, 2000. The exercise
of the Garden State Plaza Option will require the approval of at least 75% of
the Independent Directors and, if the purchase price (which is payable in Common
Stock) will exceed $55 million (net of the $145 million Garden State Plaza
Loan), the approval of a majority of the holders of the Common Stock

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<PAGE>
voting at a meeting on such issue other than Westfield Holdings and its
affiliates (including, without limitation, WAT) and interests associated with
the Lowy family.

INCREASING OPERATING INCOME FROM EXISTING SPACE; INTENSIVE MANAGEMENT APPROACH

Westfield Holdings (i) manages shopping centers not as passive real estate
investments but as "living entities" which must be skillfully managed and
redeveloped over time to maintain and enhance their capacity to generate optimum
returns; (ii) has in-house skills to manage every stage in the development and
on-going life of a shopping center, including initial concept, design,
construction, leasing of stores and day-to-day management and promotion; (iii)
works to build and maintain long-term relationships with major retailers and
institutional investors; (iv) continually searches for new ways to increase
income and add capital growth to the shopping centers it manages; and (v) makes
customer service a major focus. Westfield Holdings concentrates on obtaining
repeat business with all key stakeholders in its shopping centers. The Company
believes that this management style has the potential to improve the performance
of its retail property assets, resulting in income growth and capital
appreciation for investors.

Westfield Holdings concentrates on actively managing the Centers and
providing efficient and customer-friendly service to both the consumers who shop
in the Centers and the retailers who lease space in the Centers while strictly
controlling operating costs. The concept of the "Westfield Customer Service
System" has been introduced in the Centers to train and focus the personnel at
the Centers on its retailers and customers. The Company believes that this is
one of the most important strategies that differentiates Westfield Holdings's
management philosophy from the Company's competitors. The Company also believes
that branding the Centers through advertising, promotions and customer service
programs will build shopper recognition and loyalty, especially in multi-center
markets.

Westfield Holdings's marketing expertise has been recognized through a
number of national and international awards, most notably an ICSC 'Maxi' Award
for marketing in 1993, and three additional 'Maxi' Awards in 1994 and an ICSC
Award for shopping center public relations in 1996.

The Company seeks to increase rental income by leasing of currently unleased
space, increasing base rent as current leases with below market rents expire,
increasing occupancy levels, increasing rentable area in the Centers, adding to
the temporary leasing program and repositioning to increase sales productivity
and expand market penetration and market base. The average base rental rate per
square foot for the Mall Stores at the Centers under Westfield Holdings
management has increased at a compound annual rate of approximately 4.5% from
December 31, 1994 through December 31, 1996 (4.2%, including North County Fair).
The Company's share of total annual base rent from tenants at the existing
Centers is expected to increase by approximately $16.5 million over the next
five years as a result of contractual rent increases for all Centers. As
required by GAAP, contractual rent increases are recognized as rental income
using the straight line method over the respective lease term. For the year
ended December 31, 1996, with respect to Centers managed by Westfield Holdings
353 leases totaling approximately 880,000 square feet (representing 11.4% of
Mall GLA) were signed at an average annualized base rent of $28.16 psf for the
initial year of occupancy, which represented a 31.1% increase over expiring
leases. Including North County Fair, for the year ended December 31, 1996, 391
leases totalling approximately 961,500 square feet (representing 12.5% of Mall
GLA) were signed at an average annualized base rent of $28.62 psf for the
initial year of occupancy, which represented a 25.1% increase over expiring
leases.

The Company's goal is to increase customer traffic through the Centers for
the purpose of improving sales turnover and, ultimately, rents. The Company
believes that the introduction of entertainment concepts such as the AMC
multiplex 20-screen theater added to the Mission Valley Center, which theater
complex drew in excess of two million people for the year ended 1996, is one
strategy for increasing

45
<PAGE>
customer traffic. The Westfield Customer Service System is utilized in order to
train and focus the Centers' personnel and promote repeat business. New services
being introduced at some Centers include: special customer service personnel,
free strollers and wheelchairs, valet parking, gift vouchers and parents'
facilities.

The Company believes that advertising is also critical to improving customer
traffic. The Manager has an in-house marketing staff and utilizes the resources
of a leading U.S. advertising agency in the United States to provide
advertising, promotional and media services to the Centers. The Company utilizes
a national marketing program that includes shared advertising, media and
community promotions in the Centers. This strategy is particularly cost
effective in the Company's multi-Center regional markets in San Diego, Missouri,
Maryland and Connecticut.

The Manager analyzes marketing trends for the Company and develops and
implements creative approaches to retail shopping in the Centers. Each Center
follows an annual marketing plan that features a combination of advertising,
promotions and participation in community and charitable events. Activities such
as Kids Clubs and senior citizen "mall walkers clubs" have been effective in
positioning the Centers as the "Main Street" within their communities.

The Company believes the diversity and strength of its Anchors and the
diversity and mix of its Mall Stores are critical to expanding a Center's market
share and the Company monitors and coordinates the mix of its Anchors and Mall
Stores accordingly. The Company believes that the recent sales and
consolidations of department stores have given the Company the opportunity to
enhance its mix of Anchors. Periodically, the Company engages market research
firms to evaluate the trade area of each Center. Demographic information lets
the Company match the tenant mix of its Centers with the merchandise and service
needs of its customers in order to increase sales.

46
<PAGE>
USE OF PROCEEDS

The net cash proceeds to be received by the Company from the Offerings
(after deducting underwriting discounts and the estimated expenses of the
Offerings) are estimated to be approximately $244.8 million, $282.4 million if
the underwriters exercise their over-allotment options in full. The Company also
expects to receive at the closing of the Offerings net cash proceeds of $26.1
million from the sale to ABP of 270,000 shares of the Series B Preferred Shares
and the sale to WAT of the 1997 WAT Warrant. The Company expects to use the
aggregate net proceeds of the Offerings to fund a portion of the following:
$145.0 million to make the Garden State Plaza Loan, approximately $133.0 million
for the Annapolis Acquisition, approximately, $52.5 million for the Wheaton
Acquisition, and approximately $15.3 million (Aus.$19.6 million) to purchase the
Westfield Holdings Warrants.

In addition, the Company expects to increase its unsecured borrowings under
its line of credit by approximately $75 million in connection with the
transactions described above. The Company has entered into a letter of intent
with National Australia Bank Limited, Australia and New Zealand Banking Group
Limited, Commonwealth Bank of Australia and Union Bank of Switzerland to
increase and expand its existing line of credit from $50.0 million to $600.0
million, although no assurance can be given in this regard. See "Business and
Properties--Debt Summary." If, for any reason, such loan facility is not
available at the time the above transactions occur, the Company believes it has
the ability to borrow sufficient funds utilizing as security its existing
properties and the properties to be acquired to complete such transactions.

Consummation of certain of the foregoing transactions are subject to certain
conditions, including the sale to ABP of the Series B Preferred Shares, the
Annapolis Acquisition and the Wheaton Acquisition, and there can be no assurance
that each of the contemplated transactions will be consummated. If any such
transaction is not completed, the net proceeds to be raised from the Offerings
and concurrent transactions or utilized thereby may be reallocated for general
corporate purposes including the repayment of debt and potential acquisitions.

Pending application of the aggregate net proceeds of the Offerings (and the
net proceeds of the exercise of the over-allotment options, if they are
exercised) and concurrent transactions, the Company will invest such net
proceeds in interest-bearing accounts and short-term, interest-bearing
securities that are intended to permit the Company to qualify for taxation as a
REIT or to temporarily repay certain revolving credit loans. Such investments
may include, for example, obligations of the Government National Mortgage
Association, other government and government agency securities, certificates of
deposit, interest-bearing bank deposits and mortgage loan participations. See
"Federal Income Tax Considerations-- Taxation of the Company--Income Tests."

47
<PAGE>
CAPITALIZATION

The following table sets forth the capitalization of the Company, as of
March 31, 1997, and as adjusted to give effect to the consummation of the
Offerings and concurrent transactions and the application of the estimated net
proceeds therefrom as set forth under "Use of Proceeds." The information set
forth in the table should be read in connection with the financial statements
and notes thereto, the pro forma financial information and notes thereto and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources" included elsewhere in this
Prospectus.

<TABLE>
<CAPTION>
MARCH 31, 1997
--------------------------
HISTORICAL AS ADJUSTED
------------ ------------
($ IN THOUSANDS EXCEPT PER
SHARE AMOUNTS)
<S> <C> <C>
Cash and cash equivalents............................................................. $ 2,647 $ 2,647
------------ ------------
------------ ------------

Long-term debt........................................................................ 783,285 858,262

Shareholders' equity:

Senior Preferred Shares, $1.00 par value per share (200 shares authorized, 105
shares issued and outstanding).................................................... -- --

Preferred Stock, $1.00 par value per share (5,000,000 shares authorized, of which
940,000 shares of Series A Preferred Shares are issued and outstanding and 270,000
shares of Series B Preferred Shares will be issued and outstanding)............... 94,000 121,000

Common Stock, $.01 par value per share (225,006,300 authorized, 52,929,535 shares
issued and outstanding at March 31, 1997, 200,000,000 authorized and 70,929,535
shares issued and outstanding as adjusted)........................................ 529 709

Excess Shares, $.01 par value per share (205,000,000 shares authorized, no shares
issued and outstanding, as adjusted).............................................. -- --

Additional paid-in capital............................................................ 424,001 667,644

Retained earnings..................................................................... 5,554 5,554
------------ ------------

Total shareholders' equity........................................................ 524,084 794,907
------------ ------------

Total capitalization............................................................ $ 1,310,016 $ 1,655,816
------------ ------------
------------ ------------
</TABLE>

48
<PAGE>
DILUTION

"Dilution per share" means the difference between the initial public
offering price per share of Common Stock and the pro forma net tangible book
value per share of Common Stock after giving effect to the sale by the Company
of the Shares offered hereby, assuming an initial public offering price of
$15.00. "Pro forma net tangible book value per share" is determined by dividing
total assets less total liabilities and Preferred Stock by the number of shares
of Common Stock outstanding. The following table illustrates such pro forma per
share dilution after giving effect to the Offerings as of March 31, 1997.

<TABLE>
<CAPTION>
Initial public offering price per Share(1)................... $ 15.00
<S> <C> <C>
---------
Pro forma net tangible book value prior to the Offerings..... 8.13
Increase in net tangible book value attributable to the
Offerings.................................................. 1.37
---------
Pro forma net tangible book value after the Offerings........ 9.50
---------
Dilution in net tangible book value per share of Common Stock
to new investors........................................... $ 5.50
---------
---------
</TABLE>

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

(1) Before deduction of the estimated underwriting discounts and expenses of the
Offerings.

The following table summarizes, on a pro forma basis after giving effect to
the Offerings and concurrent transactions, the number of shares of Common Stock
held on a fully-diluted basis by, and the effective cost and average price per
share paid by Westfield Holdings, WAT and the purchasers in the Offerings.

<TABLE>
<CAPTION>
SHARES ISSUED EFFECTIVE COST AVERAGE
----------------------- FOR SHARES OF PRICE PER
NUMBER PERCENT COMMON STOCK SHARE
------------ --------- ----------------- -----------
<S> <C> <C> <C> <C>
Shares of Common Stock sold
to purchasers in the Offerings....................... 18,000,000 22.7% $ 270,000,000 $ 15.00
Shares of Common Stock owned
by Westfield Holdings(1)............................. 10,930,672 13.8 122,288,000 11.19
Shares of Common Stock owned
by WAT............................................... 49,453,758 62.4 792,204,000 16.02
------------ -----------------
Total................................................ 78,384,430 $ 1,184,492,000 $ 15.11
------------ ----------------- -----------
------------ ----------------- -----------
</TABLE>

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

(1) Westfield Holdings will purchase 2,300,000 Shares, which will increase the
effective cost for its shares of Common Stock to $156,788,000 and its
average price per share to $11.85.

49
<PAGE>
DISTRIBUTIONS

For the period February 12, 1994 through March 31, 1997, the Company has
distributed approximately 98% of its Funds from Operations. However, the Company
intends to revise its policy upon consummation of the Offerings such that it
will distribute annually approximately 90% of its Funds from Operations through
December 31, 1998. Thereafter, the Company intends to distribute annually
approximately 90% to 95% of its Funds from Operations; however, the Company does
not intend to distribute more than 100% of Funds from Operations less recurring
capital expenditures (not including capital expenditures recovered from tenants)
and rental income attributable to rent straight-lining. As a result of the
revision of its policy, the Company has declared the Special Distribution for
the shareholders of the Company immediately prior to the closing of the
Offerings in an amount of $13.0 million. The Special Distribution will be
payable on the regular payment date for the second quarter distribution if the
Offerings occur or, if the Offerings do not occur, in seven quarterly
installments at the same time as the Company's regular quarterly distributions.
The Special Distribution represents a portion of the distributions estimated at
the time of WAT's initial offering of units in Australia for the period through
1998.

It is estimated that initially approximately 35% of the distribution to the
Company's shareholders will represent a return of capital for tax purposes. The
expected size of the distributions may not allow the Company, using only cash
flow from operations, to fund 100% of (i) the tenant allowances and (ii) the
retirement of all of its debt when due, and therefore, the Company may be
required to seek periodic debt or equity financings to cover such items. The
Company's income will consist primarily of its share of income from the
Properties. Differences in timing between the receipt of income and the payment
of expenses in arriving at taxable income of the Company, and the effect of
required debt amortization payments, could require the Company to borrow funds
on a short-term basis to meet the REIT distribution requirements even if the
Company believes that then prevailing market conditions are not generally
favorable for such borrowings or that such borrowings would not be advisable in
the absence of such tax considerations. See "Policies and Objectives with
Respect to Investments, Financing and Other Activities--Financing."

The Company plans to adopt a distribution reinvestment plan under which its
shareholders may elect to reinvest all or a part of their distributions
automatically in additional shares of Common Stock. Any such distribution
reinvestment plan will not adversely affect the Company's ability to qualify as
a REIT for Federal income tax purposes. The Company understands that WAT plans
to adopt a similar plan for its unitholders and intends to use the proceeds of
such distribution reinvestment plan to participate in the Company's distribution
reinvestment plan to the extent that its unitholders participate in the WAT

50
<PAGE>
distribution reinvestment plan. The Company also understands that Westfield
Holdings intends to participate in WAT's distribution reinvestment plan to the
full extent of its distributions on its units in WAT for a three-year period
commencing with the first distribution period for which reinvestment is
permitted. No assurances can be given that WAT will in fact adopt a distribution
reinvestment plan, that WAT will participate in the Company's distribution
reinvestment plan, and that Westfield Holdings will choose not to participate in
WAT's distribution reinvestment plan in the future.

The Company computes Funds from Operations in accordance with standards
established by the White Paper on Funds from Operations approved by the Board of
Governors of NAREIT in March 1995 which defines Funds from Operations as net
income (loss) (computed in accordance with GAAP), excluding gains (or losses)
from debt restructuring and sales of property, plus real estate related
depreciation and amortization and after adjustments for unconsolidated
partnerships and joint ventures. Funds from Operations should not be considered
as an alternative to net income (determined in accordance with GAAP) as a
measure of the Company's financial performance or to cash flow from operating
activities (determined in accordance with GAAP) as a measure of the Company's
liquidity, nor is it indicative of funds available to fund the Company's cash
needs, including its ability to make distributions. In addition, Funds from
Operations as computed by the Company may not be comparable to similarly titled
figures reported by other REITs.

SELECTED FINANCIAL DATA

The following table sets forth historical and unaudited pro forma
consolidated financial data for the Company and should be read in conjunction
with the Consolidated Financial Statements of Westfield America, Inc. and the
Notes thereto, the Pro Forma Condensed Consolidated Financial Information of the
Company (unaudited) and the Notes thereto and "Management's Discussion and
Analysis of Financial Condition and Results of Operations." The Company believes
that the book value of its real estate assets, which reflects the historical
costs of such real estate assets less accumulated depreciation, is less than the
current market value of its properties.

The results for 1994 are not comparable to prior years because of the
acquisition of the Company in February 1994. Hence, a pro forma adjustment has
been applied to historical results of operations for the 42 days ended February
11, 1994 to present operating and other data as if the acquisition of the
Company on February 12, 1994 had been consummated on January 1, 1994. The
results for 1996 are not comparable to prior years because of the
Recapitalization, the acquisition of the Acquired Properties and the
consolidation of the Mission Valley Partnership.

Unaudited Pro Forma operating information is presented as if the
consummation of the Offerings and concurrent transactions and the
Recapitalization had occurred as of the period presented, and therefore
incorporates certain assumptions that are described in the Notes to the Pro
Forma Condensed Consolidated Statement of Income (unaudited). The Pro Forma
balance sheet data (unaudited) is presented as if the Offerings and concurrent
transactions and the Recapitalization had occurred on March 31, 1997.

51
<PAGE>
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEARS ENDED DECEMBER 31,
MARCH 31, ---------------------------------
------------------------------- UNAUDITED
UNAUDITED PRO
PRO FORMA FORMA
1997 1997 1996 1996 1996 1995
--------- --------- --------- ----------- --------- ---------
(IN THOUSANDS OF
DOLLARS, EXCEPT PER
SHARE AMOUNTS AND
RATIOS)
<S> <C> <C> <C> <C> <C> <C>
OPERATING DATA:
REVENUES:
Minimum rents................................................ $ 37,641 $ 30,742 $ 20,967 $ 151,927 $ 106,393 $ 75,154
Tenant recoveries............................................ 16,287 14,055 8,987 62,872 44,423 32,335
Percentage rents............................................. 1,986 1,986 1,572 3,991 3,991 1,690
Service fee and other income................................. 120 120 475 1,282 1,282 2,148
--------- --------- --------- ----------- --------- ---------
Total revenue............................................ 56,034 46,903 32,001 220,072 156,089 111,327
EXPENSES:
Operating--recoverable....................................... 15,895 13,771 8,916 64,325 44,487 31,184
Other operating.............................................. 1,205 992 721 7,458 4,513 3,061
Management fees.............................................. 1,273 928 728 5,562 3,495 1,828
Advisory Fees................................................ -- -- -- 2,600
General and administrative................................... 236 236 153 808 808 776
Depreciation and amortization................................ 12,828 11,539 8,027 48,287 38,033 28,864
--------- --------- --------- ----------- --------- ---------
Operating income......................................... 24,597 19,437 13,456 93,632 62,153 45,614
Interest expense, net.......................................... 14,172 12,860 7,482 55,465 40,233 27,916
--------- --------- --------- ----------- --------- ---------
Income before other income and income taxes.............. 10,425 6,577 5,974 38,167 21,920 17,698
Equity in net income (loss) of unconsolidated real estate
partnerships.................................................. 501 1,293 733 55 3,063 3,359
Interest and other income...................................... 3,637 312 230 13,512 776 789
Gains on sales of properties and partnership interests......... -- -- -- --
Income taxes................................................... -- -- -- -- -- --
Minority interest in earnings of consolidated real estate
partnership................................................... (931) (218) (230) (3,006) (1,063) --
--------- --------- --------- ----------- --------- ---------
Net income................................................... $ 13,632 $ 7,964 $ 6,707 $ 48,728 $ 24,696 $ 21,846
--------- --------- --------- ----------- --------- ---------
--------- --------- --------- ----------- --------- ---------
Net income allocable to common shares.......................... $ 11,061 $ 5,966 $ 6,706 $ 38,443 $ 20,432 $ 21,843
Earnings per share(1).......................................... $ 0.16 $ 0.11 $ 0.15 $ 0.54 $ 0.42 $ 0.48
--------- --------- --------- ----------- --------- ---------
--------- --------- --------- ----------- --------- ---------
Dividends declared per common share(1)......................... $ 0.34 $ 0.01 $ 0.06 $ 1.24 $ 1.51 $ 1.68
--------- --------- --------- ----------- --------- ---------
--------- --------- --------- ----------- --------- ---------
OTHER DATA
EBITDA(2)...................................................... $ 45,045 $ 37,242 $ 27,540 $ 172,033 $ 124,352 $ 102,199
Funds from Operations(3)....................................... $ 29,055 $ 22,564 $ 18,046 $ 108,291 $ 75,842 $ 65,792
Cash flows provided by Operating Activities.................... $ -- $ 11,570 $ 11,808 $ -- $ 55,888 $ 42,990
Cash flows (used in) provided by Investing Activities.......... $ -- $ (5,389) $ (833) $ -- $ (91,613) $ 5,476
Cash flows (used in) provided by Financing Activities.......... $ -- $ (10,263) $ (9,510) $ -- $ 42,454 $ (62,722)
Ratio of earnings to combined fixed charges(4)................. 1.87 1.59 1.99 1.72 1.60 2.25
Ratio of FFO to combined fixed charges(4)...................... 2.58 2.33 3.30 2.49 2.52 3.35
Funds from operations allocable to common shares............... $ 26,484 $ 20,566 $ 18,045 $ 98,006 $ 71,578 $ 65,789
Weighted average number of common shares....................... 70,930 53,481 45,109 70,930 49,383 44,978

<CAPTION>
PREDECESSOR
PERIOD FROM PERIOD FROM
FEBRUARY 12, JANUARY 1, YEAR ENDED DECEMBER
1994 THROUGH 1994 THROUGH 31,
DECEMBER 31, FEBRUARY 11, --------------------
1994 1994 1993 1992
------------- ------------- --------- ---------

<S> <C> <C> <C> <C>
OPERATING DATA:
REVENUES:
Minimum rents................................................ $ 58,750 $ 7,309 $ 60,726 $ 58,152
Tenant recoveries............................................ 32,023 4,036 31,359 30,285
Percentage rents............................................. 2,470 467 2,960 3,041
Service fee and other income................................. 6,213 957 10,192 11,067
------------- ------------- --------- ---------
Total revenue............................................ 99,456 12,769 105,237 102,545
EXPENSES:
Operating--recoverable....................................... 29,477 4,326 31,693 32,959
Other operating.............................................. -- -- -- --
Management fees.............................................. -- -- -- --
Advisory Fees................................................
General and administrative................................... 7,129 2,543 20,038 20,970
Depreciation and amortization................................ 24,897 3,605 29,011 22,650
------------- ------------- --------- ---------
Operating income......................................... 37,953 2,295 24,495 25,966
Interest expense, net.......................................... 24,156 481 7,160 24,652
------------- ------------- --------- ---------
Income before other income and income taxes.............. 13,797 1,814 17,335 1,314
Equity in net income (loss) of unconsolidated real estate
partnerships.................................................. (386) (2,151) (3,177) (76)
Interest and other income...................................... 1,830 340 2,996 4,191
Gains on sales of properties and partnership interests......... -- -- 2,566 23,428
Income taxes................................................... -- -- (13,819) (11,231)
Minority interest in earnings of consolidated real estate
partnership................................................... -- -- -- --
------------- ------------- --------- ---------
Net income................................................... $ 15,241 $ 3 $ 5,901 $ 17,626
------------- ------------- --------- ---------
------------- ------------- --------- ---------
Net income allocable to common shares.......................... $ 15,241 3 $ 5,901 $ 17,626
Earnings per share(1).......................................... $ 0.34 n/a(5) $ -- $ --
------------- ------------- --------- ---------
------------- ------------- --------- ---------
Dividends declared per common share(1)......................... $ 0.81 n/a(5)
-------------
-------------
OTHER DATA
EBITDA(2)...................................................... $ 83,529 $ 8,691 $ 80,432 $ 94,545
Funds from Operations(3)....................................... $ 53,315 $ 4,942 $ 60,472 $ 37,974
Cash flows provided by Operating Activities.................... $ 20,665 $ 5,294 $ 35,883 $ 25,138
Cash flows (used in) provided by Investing Activities.......... $ 23,556 $ (23,501) $ (42,778) $ (3,999)
Cash flows (used in) provided by Financing Activities.......... $ (67,988) $ 26,013 $ (13,772) $ 14,742
Ratio of earnings to combined fixed charges(4)................. 2.89 3.47 1.47
Ratio of FFO to combined fixed charges(4)...................... 3.21 7.26 2.45
Funds from operations allocable to common shares............... $ 53,315 $ 60,472 $ 37,974
Weighted average number of common shares....................... 44,902 52 52
</TABLE>

(FOOTNOTES ON FOLLOWING PAGE)

52
<PAGE>

<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
-------------------------- YEAR ENDED YEAR ENDED
UNAUDITED DECEMBER 31, DECEMBER 31,
PRO FORMA ------------------------------------ ----------------------
1997 1997 1996 1995 1994 1993 1992
------------ ------------ ------------ ---------- ---------- ---------- ----------
(IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNTS AND RATIOS)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Investment in real
estate, net.......... $ 1,635,962 $ 1,305,462 $ 1,310,434 $ 829,484 $ 848,892 $ 884,392 $ 851,168
Total assets.......... $ 1,684,802 $ 1,339,002 $ 1,344,570 $ 844,706 $ 882,667 $ 944,490 $ 951,678
Mortgage and notes
payable.............. $ 858,262 $ 783,285 $ 770,625 $ 426,781 $ 420,397 $ 38,205 $ 317,857
Minority interest..... $ -- $ -- $ 54 $ -- $ -- $ -- $ --
Shareholders'
equity............... $ 794,907 $ 524,084 $ 518,530 $ 380,419 $ 430,782 $ 669,967 $ 393,466
</TABLE>

(3) The Company computes Funds from Operations in accordance with standards
established by the White Paper on Funds from Operations approved by the
Board of Governors of NAREIT in March 1995 which defines Funds from
Operations as net income (loss) (computed in accordance with GAAP) excluding
gains (or losses) from debt restructuring and sales of property, plus real
estate related depreciation and amortization and after adjustments for
unconsolidated partnerships and joint ventures except for the years ended
December 31, 1993 and 1992 for which income taxes are not included. Funds
from Operations should not be considered as an alternative to net income
(determined in accordance with GAAP) as a measure of the Company's financial
performance or to cash flow from operating activities (determined in
accordance with GAAP), as a measure of the Company's liquidity, nor is it
indicative of funds available to fund the Company's cash needs, including
its ability to make distributions. In addition, Funds from Operations as
computed by the Company may not be comparable to similarily titled figures
reported by other REITs.

(4) Combined fixed charges consist of interest expense, whether expensed or
capitalized, amortization of debt expense and income allocable to Senior
Preferred Shares, Series A Preferred Shares and on an unaudited Pro Forma
basis, Series B Preferred Shares.

(5) The computation for the 42 days ended February 11, 1994 is not presented as
it is not comparable.

53
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the "Selected
Financial Data," the Company's Consolidated Financial Statements and Notes
thereto, and the Unaudited Pro Forma Condensed Consolidated Financial Statements
of the Company and Notes thereto. Historical results set forth in "Selected
Financial Data," the Company's Consolidated Financial Statements and the
Unaudited Pro Forma Condensed Consolidated Financial Statements of the Company
are not necessarily indicative of the future financial position and results of
operations of the Company.

On February 11, 1994, the Company was acquired by Westfield Holdings and
certain other investors from Prudential (the "Acquisition"). The financial
statement results presented for the 323-day period from February 12, 1994
through December 31, 1994 and the 42-day period from January 1, 1994 through
February 11, 1994 are not indicative of the Company's performance on an annual
basis. Therefore, the discussion of results of operations for 1994 are presented
on a combined basis to compare to the full year 1995. The Company believes this
presentation provides a more meaningful discussion of year-to-year results.

GENERAL BACKGROUND

At December 31, 1996 and the year then ended, the Consolidated Financial
Statements and Notes thereto reflect the consolidated financial results of 12
Centers, the equity in income (loss) of seven unconsolidated real estate
partnerships, the Acquired Properties following their acquisition on July 1,
1996, 13 separate department store properties that are net leased to the May
Company under financing leases, and a 116-unit apartment complex. At December
31, 1995 and the year then ended, the Consolidated Financial Statements reflect
the Mission Valley Partnership, the owner of Mission Valley Center and Mission
Valley Center-West, as an unconsolidated real estate partnership. In September
1995, the Company acquired a controlling interest in the Mission Valley
Partnership and consolidated the Mission Valley Partnership beginning in 1996.
In connection with the Acquisition, Westfield Holdings's assumed the management
of the Company's shopping centers and consolidated the Company's St. Louis
headquarters operations with Westfield Holdings's U.S. operations in Los
Angeles. As a result of the transfer of the management, the Company's general
and administrative expenses decreased by $4.0 million from 1994 to 1995 and its
service fee and other income decreased by $5.0 million for such period because
the Company previously provided management services to certain of the
unconsolidated real estate partnerships. As a result of the above described
items and Westfield Holdings's management of the Properties, the Company's Funds
from Operations has increased 13% and 15% in 1995 and 1996, respectively, from
the prior years.

The Company believes that the Offerings will improve the Company's financial
condition by providing the Company with capital to take advantage of the
redevelopment and acquisition opportunities represented by the Annapolis
Acquisition and the Wheaton Acquisition. The Company's operating results are
expected to improve as a result of certain transactions as discussed in "Use of
Proceeds," "Capitalization" and the Unaudited Pro Forma Condensed Consolidated
Financial Statements.

The following Pro Forma Operating Data compares the pro forma consolidated
results of the Company for the twelve months ended December 31, 1994 and 1995.
The pro forma information has been derived by the application of a pro forma
adjustment to the historical consolidated results of the Company for the 42 and
323 day periods in 1994. The pro forma balance for the year ended December 31,
1994 gives effect to the acquisition of the Company on February 11, 1994 as if
it had been consummated on January 1, 1994.

54
<PAGE>

<TABLE>
<CAPTION>
PREDECESSOR PRO FORMA
PERIOD FROM PERIOD FROM ADJUSTMENTS THROUGH
FEBRUARY 12, JANUARY 1, PREDECESSOR PRO FORMA
YEAR 1994 1994 OPERATIONS YEAR
ENDED THROUGH THROUGH JAN. 1, 1994 ENDED
DECEMBER 31, DECEMBER 31, FEBRUARY 11, TO FEB. 11, DECEMBER 31,
1995 1994 1994 1994 1994
------------- ------------- ------------- ----------------------- -------------
<S> <C> <C> <C> <C> <C>
OPERATING DATA:
Total revenue...................... $ 111,327 $ 99,456 $ 12,769 $ 0 $ 112,225
Operating expenses................. 36,849 36,606 6,869 43,475
Interest expense, net.............. 27,916 24,156 481 0 24,637
Depreciation and amortization...... 28,864 24,897 3,605 (368)(a) 28,134
------------- ------------- ------------- ----- -------------
Income before other income and
income taxes................... 17,698 13,797 1,814 368 15,979
Equity in net income (loss) of
unconsolidated real estate
partnerships..................... 3,359 (386) (2,151) 0 (2,537)
Interest and other income.......... 789 1,830 340 0 2,170
Gains on sales of properties and
partnership interests............ 0 0 0 0 0
------------- ------------- ------------- ----- -------------
Income before income taxes and
minority interest.............. 21,846 15,241 3 368 15,612
Income taxes....................... 0 0 0 0
Minority interest in consolidated
real estate partnership.......... 0 0 0 0 0
------------- ------------- ------------- ----- -------------
Net income....................... $ 21,846 $ 15,241 $ 3 $ 368 $ 15,612
------------- ------------- ------------- ----- -------------
------------- ------------- ------------- ----- -------------
</TABLE>

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

(a) Depreciation and amortization expense has been reduced to reflect the
depreciation and amortization of property and equipment as if the purchase
of the Company had been consummated on January 1, 1994.

RESULTS OF OPERATIONS

COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1997 TO THE THREE MONTHS ENDED
MARCH 31, 1996 (UNAUDITED)

TOTAL REVENUES increased $14.9 million or 47% to $46.9 million for the three
months ended March 31, 1997 as compared to $32.0 million for the same period in
1996. The increase is primarily the result of the acquisition of the Acquired
Properties which contributed $13.3 million or 89% of the increase. Excluding the
total revenues generated by the Acquired Properties, total revenues increased
$1.6 million due to an increase in average rental rates throughout the portfolio
and strong specialty (temporary) leasing (which involves temporary leases of
space for a period of 30 days to 11 months). The Company believes such specialty
leasing will continue to be part of the Company's leasing program.

TOTAL EXPENSES increased $9.0 million or 49% to $27.5 million for the three
months ended March 31, 1997 as compared to $18.5 million for the same period in
1996. The increase was primarily the result of the acquisition of the Acquired
Properties which contributed $7.7 million or 86% of the increase in total
expenses. Additionally, depreciation expense increased $1.1 million or 12% of
the increase in total expenses due to the Mission Valley Center and Mid Rivers
Mall redevelopment projects being substantially completed during the quarter
ended March 31, 1997.

INTEREST EXPENSE increased $5.4 million or 72% to $12.9 million for the
three months ended March 31, 1997 as compared to $7.5 million for the same
period in 1996. The increase was primarily due to the acquisition of the
Acquired Properties which contributed $4.9 million or 91% of the increase in
interest expense. The remaining increase in interest expense was due primarily
to the Mission Valley Center and Mid Rivers Mall redevelopment projects
substantially completed during the quarter ended March 31, 1997.

EQUITY IN INCOME of unconsolidated real estate partnerships increased
approximately $0.55 million or 76% to $1.3 million for the three months ended
March 31, 1997 as compared to $0.75 million for the same period in 1996 due to
the 1997 recovery of earthquake repair costs totaling $0.2 million which were
incurred by the Topanga Plaza Partnership as a result of the 1994 Northridge
earthquake. Additionally, minimum rents increased for the portfolio of
unconsolidated real estate partnerships.

55
<PAGE>
NET INCOME increased $1.2 million or 19% to $7.9 million for the three
months ended March 31, 1997 as compared to $6.7 million for the same period in
1996 for the reasons discussed above.

COMPARISON OF YEAR ENDED DECEMBER 31, 1996 TO YEAR ENDED DECEMBER 31, 1995

TOTAL REVENUES increased $44.8 million or 40% to $156.1 million for the year
ended December 31, 1996 as compared to $111.3 million for the same period in
1995. The increase is primarily the result of the acquisition of the Acquired
Properties and consolidation of the Company's equity interest in the Mission
Valley Partnership. The Acquired Properties contributed $27.1 million or 61% of
the increase in total revenues from 1995 to 1996 and the Mission Valley
Partnership contributed $13.1 million or 29% of the increase. Total revenues
increased $4.5 million or 10% of the increase in total revenues from 1995 to
1996 due to increases in average rental rates throughout the portfolio and
strong specialty (temporary) leasing (which involves temporary licenses of space
for a period from 30 days to 11 months). The Company believes such specialty
leasing will continue to be an ongoing part of the Company's leasing program.

TOTAL EXPENSES increased $28.2 million or 43% to $93.9 million for the year
ended December 31, 1996 as compared to $65.7 million for the same period in
1995. The increase is primarily the result of the acquisition of the Acquired
Properties and consolidation of the Company's equity interest in the Mission
Valley Partnership. The Acquired Properties contributed $15.5 million or 55% of
the increase in total expenses from 1995 to 1996 and the Mission Valley
Partnership contributed $8.2 million or 29% of the increase. Total expenses
increased $1.9 million or 7% of the increase in total expenses from 1995 to 1996
due to increases in other operating expenses ($0.6 million), management fees
($0.4 million) and depreciation and amortization ($0.9 million).

INTEREST EXPENSE, net of capitalized interest, increased $12.3 million or
44% to $40.2 million for the year ended December 31, 1996 as compared to $27.9
million for the same period in 1995. The increase is due primarily to the
acquisition of the Acquired Properties and consolidation of the Company's equity
interest in the Mission Valley Partnership. The Acquired Properties contributed
$10.0 million to the increase in net interest expense and the Mission Valley
Partnership contributed $1.9 million to the increase. On a combined basis, the
Acquired Properties and the Mission Valley Partnership represent 97% of the
increase in net interest expense.

MINORITY INTEREST IN REAL ESTATE PARTNERSHIPS was $1.1 million for the year
ended December 31, 1996 due to the consolidation of the Mission Valley
Partnership in 1996.

EQUITY IN INCOME (LOSSES) of unconsolidated real estate partnerships
decreased by $0.3 million due primarily to the consolidation of the Mission
Valley Partnership in 1996.

NET INCOME increased $2.9 million (which is net of a $2.6 million advisory
fee) or 13% to $24.7 million from $21.8 million for the same period in 1995.
Excluding the advisory fee, which was not payable for 1996, net income increased
$5.5 million of which the Acquired Properties contributed $1.6 million or 29% of
the increase, the Mission Valley Partnership contributed $2.1 million or 38% of
the increase and the other Properties contributed $1.8 million or 33% of the
increase.

COMPARISON OF YEAR ENDED DECEMBER 31, 1995 TO PRO FORMA YEAR ENDED DECEMBER 31,
1994

TOTAL REVENUES decreased $0.9 million or 1% to $111.3 million for the year
ended December 31, 1995 as compared to $112.2 million for the Pro Forma year
ended December 31, 1994. The increase in rental revenues from $66.1 million to
$75.1 million for Pro Forma 1994 to 1995 is primarily the result of increased
minimum rents at Montgomery Mall and The Plaza at West Covina, the completion of
the redevelopment of Westland Towne Center in late 1994, and the increase in the
specialty leasing and kiosk program. Offsetting this increase was a reduction in
service fee income and tenant recoveries. Service fee income decreased $5.0
million in 1995 as a result of Westfield Holdings's assumption of the management
of the Company's shopping centers as described above. Tenant recovery revenue
decreased $3.7 million due to lower recoverable operating expenses.

56
<PAGE>
TOTAL EXPENSES decreased $6.3 million or 9% to $65.7 million for the year
ended December 31, 1995 as compared to $72.0 million for the Pro Forma year
ended December 31, 1994. The decrease is due primarily to a decrease of $4.0
million in general and administrative costs resulting from Westfield Holdings's
assumption of the management of the Centers as described above. Additionally,
operating-recoverable expenses decreased $2.6 million due to operational
efficiencies.

INTEREST EXPENSE increased $3.3 million or 13% to $27.9 million for the year
ended December 31, 1995 as compared to $24.6 million for the Pro Forma year
ended December 31, 1994. The increase resulted primarily from borrowings assumed
in connection with the Acquisition and the borrowings of $1.5 million in
connection with the purchase of a department store at Enfield Square and $9.0
million for the purchase of an additional 25.8% interest in the Mission Valley
Partnership.

EQUITY IN INCOME (LOSSES) of unconsolidated real estate partnerships
increased $5.9 million to $3.4 million for the year ended December 31, 1995 as
compared to a loss of $2.5 million for the Pro Forma year ended 1994 resulting
from an improvement in operations at each of the partnerships in which the
Company has an equity interest. The Annapolis Mall net income increased $0.7
million in 1995 as a result of an increase in minimum rent. The Company's share
of operations of the Topanga Plaza Partnership increased $2.8 million as the
Topanga Plaza Partnership recognized a loss of $1.5 million for the Pro Forma
year ended 1994 as a result of the 1994 Northridge Earthquake and recognized
income of $1.3 million in 1995 from insurance proceeds received for business
interruption caused by the earthquake. Additionally, the Company increased its
ownership interest in the Mission Valley Partnership in September 1995 resulting
in the recognition of an additional 25.8% of operations of the Mission Valley
Partnership.
NET INCOME increased $6.2 million or 40% to $21.8 million for the year ended
December 31, 1995 as compared to $15.6 million for the same period in 1994 for
the reasons discussed above.

PRO FORMA OPERATING RESULTS--THREE MONTHS ENDED MARCH 31, 1997 TO THREE MONTHS
ENDED MARCH 31, 1997

On a pro forma basis, after giving effect to the Offerings and concurrent
transactions, net income of the Company for the three months ended March 31,
1997 was $13.6 million as compared to historical net income of the Company for
the same period of $7.9 million. The pro forma adjustments increased revenues by
$9.1 million and total operating expenses by $4.0 million, as a result of
reflecting the operations for Annapolis Mall and Wheaton Plaza for the three
months ended March 31, 1997. The pro forma adjustments increased interest
expense by $1.3 million as a result of additional borrowings on the Company's
unsecured corporate credit line as described under "Use of Proceeds." Equity in
income of unconsolidated real estate partnerships decreased $0.8 million due to
the purchase of the outside partner's interest in Annapolis Mall and
consolidating Annapolis Mall. The pro forma adjustments increased interest
income by $3.3 million reflecting interest earned on the Garden State Plaza Loan
as described under "Use of Proceeds." The pro forma adjustments increased the
minority interest in earnings of unconsolidated real estate partnerships by $0.7
million due to purchasing a 70% interest in Wheaton Plaza.

PRO FORMA OPERATING RESULTS--YEAR ENDED DECEMBER 31, 1996 TO YEAR ENDED DECEMBER
31, 1996

On a pro forma basis, after giving effect to the Offerings and concurrent
transactions, net income of the Company for the year ended December 31, 1996 was
$48.7 million as compared to historical net income of the Company for the same
period of $24.7 million. The pro forma adjustments increased revenues by $63.9
million and total operating expenses by $32.5 million, as a result of reflecting
the operations of the Acquired Properties for the period January 1, 1996 through
June 30, 1996, the operations of Annapolis Mall and Wheaton Plaza for the year
ended December 31, 1996 and a decrease in the advisory fee due to an amendment
of the Advisory Agreement. The pro forma adjustments increased interest expense
by $15.2 million as a result of additional borrowings on the Company's unsecured
corporate credit line as described under "Use of Proceeds," and additional
interest expense that would have been incurred had the Acquired Properties been
acquired on January 1, 1996 versus July 1, 1996. Equity in income of
unconsolidated real estate partnerships decreased $3.0 million due to the
purchase of

57
<PAGE>
the outside partner's interest in Annapolis Mall and consolidating Annapolis
Mall. The pro forma adjustments increased interest income by $12.7 million
reflecting interest earned on the Garden State Plaza Loan as described under
"Use of Proceeds." The pro form adjustments increased the minority interest in
earnings of unconsolidated real estate partnerships by $1.9 million due to
purchasing a 70% interest in Wheaton Plaza.

CASH FLOWS

COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1997 TO THE THREE MONTHS
ENDED MARCH 31, 1996 (UNAUDITED). Cash and cash equivalents decreased $5.5
million for the three months ended March 31, 1997 when compared to the same
period in 1996 due primarily to cash used in operating, investing and financing
activities. Net cash provided by operating activities decreased $0.2 million due
to an increase in tenant accounts receivable. Net cash used in investing
activities increased $4.6 million primarily due to capital expenditures totaling
$4.7 million pertaining to the expansion and redevelopment of South Shore Mall,
Eastland Center and Mid Rivers Mall partially offset by an increase in net
distributions received from unconsolidated real estate partnerships of $0.2
million. Net cash used in financing activities increased due to an increase in
net distributions to shareholders of $6.6 million, partially offset by increased
borrowings of $6.3 million incurred primarily to finance redevelopment and
expansion activities.

COMPARISON OF YEAR ENDED DECEMBER 31, 1996 TO YEAR ENDED DECEMBER 31,
1995. Cash and cash equivalents increased $6.7 million in 1996 when compared to
the same period in 1995 due to the excess of cash provided by operating
activities and financing activities over cash used for investing activities. Net
cash provided by operating activities increased by $12.9 million to $55.8
million when compared to $42.9 million in 1995. The increase in cash provided by
operating activities is primarily due to the additional cash flow generated from
the Acquired Properties. Net cash used in investing activities was $97.1 million
higher in the year ended 1996 than the comparable period of 1995 as a result of
purchasing the Acquired Properties in July 1996 for $62.8 million, renovation
and redevelopment costs of $13.3 million for Mission Valley Center which was not
consolidated in 1995, renovation and redevelopment costs at Eastland Center and
Mid Rivers Mall aggregating $17.2 million, and pre-development costs for the
Properties of $1.0 million. Net cash provided by financing activities was $105.2
million higher in the year ended 1996 than the comparable period of 1995. The
increase in cash flows provided by financing activities reflects the issuance of
stock, repurchase of stock and repayment of debt associated with the
Recapitalization. Additionally, the 1996 financing activities reflect
distributions to common and preferred shareholders which were $9.8 million
higher when compared to the same period in 1995 as a result of additional
distributable income generated by the Acquired Properties and increased
specialty leasing.

COMPARISON OF YEAR ENDED DECEMBER 31, 1995 TO YEAR ENDED DECEMBER 31,
1994. Cash and cash equivalents decreased $14.3 million in 1995 when compared
to the same period in 1994 due to the excess of cash used in financing
activities over cash provided by operating activities and investing activities.
Net cash provided by operating activities increased $17.1 million to $43.0
million when compared to $25.9 million in 1994. The increase in cash provided by
operating activities is due primarily to an increase in net income, increased
collections of accounts receivable, and changes in deferred expenses, other
assets and deferred taxes. Net cash provided by investing activities was $5.4
million higher in the year ended December 31, 1995 when compared to the
comparable period in 1994. The increase in cash provided by investing activities
reflects $12.8 million of capital expenditures in 1995 as compared to $32.1
million in 1994 primarily due to the completion of the Westland Towne Center
redevelopment in 1994. In 1995, the Company began the Eastland Center and Mid
Rivers Mall developments. This increase in cash flows from investing activities
is partially offset by a reduction in distributions received from unconsolidated
real estate partnerships of $13.7 million primarily due to a special
distribution received by the Company in 1994 from the Meriden Square Partnership
as a result of a debt financing. Net financing activities increased $20.7
million to $62.7 million for the year end December 31, 1995 when compared to
$42.0 million for the same period in 1994. The increase in cash used for
financing activities is due primarily to increased distributions due to an
increase in cash provided by operations.

58
<PAGE>
EBITDA--EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION

The Company believes that there are several important factors that
contribute to the ability of the Company to increase rent and improve
profitability of its shopping centers, including aggregate tenant sales volume,
sales per square foot, occupancy levels and tenant costs. Each of these factors
has a significant effect on EBITDA. The Company believes that EBITDA is an
effective measure of shopping center operating performance because, EBITDA is
unaffected by the debt and equity structure of the property owner. EBITDA: (i)
does not represent cash flow from operations as defined by GAAP; (ii) should not
be considered as an alternative to net income (determined in accordance with
GAAP) as a measure of the Company's operating performance; (iii) is not
indicative of cash flows from operating, investing and financing activities
(determined in accordance with GAAP); and (iv) is not an alternative to cash
flows (determined in accordance with GAAP) as a measure of the Company's
liquidity.

The Company's total EBITDA before minority interest plus its pro-rata share
of EBITDA of unconsolidated real estate partnerships ("Total EBITDA") increased
from $92.2 million in 1994 to $124.4 million in 1996, representing a compound
annual growth rate of 16%. The growth in total EBITDA reflects the addition of
Total GLA, increased rental rates, increased tenant sales, improved occupancy
levels and effective control of operating costs. During this period, the
operating profit margin increased from 62% to 64%. This improvement is also
primarily attributable to aggressive leasing of new and existing space and
effective control of operating costs.

A summary of EBITDA for the three months ended March 31, 1997 and 1996 and
the years ended December 31, 1996, 1995 and 1994 follows:
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
FOR THE YEARS ENDED DECEMBER 31,
ENDED MARCH 31, ----------------------------------
-------------------- PROFORMA
1997 1996 1996 1995 1994
--------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
(UNAUDITED)

<CAPTION>
($ IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
EBITDA of wholly-owned and consolidated real estate
partnerships......................................... $ 31,288 $ 21,762 $ 100,962 $ 75,267 $ 70,920
Pro rata share of EBITDA of unconsolidated real estate
partnerships......................................... 6,563 6,193 24,020 26,932 21,300
--------- --------- ---------- ---------- ----------
Total EBITDA........................................... $ 37,851 $ 27,955 $ 124,982 $ 102,199 $ 92,220
--------- --------- ---------- ---------- ----------
--------- --------- ---------- ---------- ----------
EBITDA after minority interest (1)..................... $ 37,242 $ 27,540 $ 124,352 $ 102,199 $ 92,220
--------- --------- ---------- ---------- ----------
--------- --------- ---------- ---------- ----------
Increase in Total EBITDA from prior period............. 35% -- 22.3% 10.8% --
Increase in EBITDA after minority interest from prior
period............................................... 35% -- 21.7% 10.8% --
</TABLE>

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

(1) EBITDA after minority interest represents earnings before interest, taxes,
depreciation and amortization for all Properties after the minority share in
Mission Valley Partnership EBITDA.

FUNDS FROM OPERATIONS

The Company computes Funds from Operations in accordance with standards
established by the White Paper on Funds from Operations approved by the Board of
Governors of NAREIT in March 1995 which defines Funds from Operations as net
income (loss) (computed in accordance with GAAP), excluding gains (or losses)
from debt restructuring and sales of property, plus real estate related
depreciation and amortization and after adjustments for unconsolidated
partnerships and joint ventures. Funds from Operations should not be considered
as an alternative to net income (determined in accordance with GAAP) as a
measure of the Company's financial performance or to cash flow from operating
activities (determined in accordance with GAAP) as a measure of the Company's
liquidity, nor is it indicative of funds available to fund the Company's cash
needs, including its ability to make distributions. In addition, Funds from
Operations as computed by the Company may not be comparable to similarly titled
figures reported by other REITs.

59
<PAGE>
The following is a summary of the Funds from Operations of the Company and a
reconciliation of net income to Funds from Operations for the periods presented:

<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE YEARS ENDED
DECEMBER 31,
ENDED MARCH 31, ---------------------------------
-------------------- PROFORMA
1997 1996 1996 1995 1994
--------- --------- --------- --------- -----------
($ IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Funds from Operations...................................... $ 22,564 $ 18,046 $ 75,842 $ 65,792 $ 58,257
--------- --------- --------- --------- -----------
--------- --------- --------- --------- -----------
Increase in Funds from Operations from prior period........ 25.0% -- 15.3% 12.9% --
--------- --------- --------- --------- -----------
--------- --------- --------- --------- -----------
Reconciliation:
Net income............................................... $ 7,964 $ 6,707 $ 24,696 $ 21,846 $ 15,612
Amortization of deferred financing leases................ 499 466 1,883 1,786 1,679
Plus:
Depreciation and amortization from consolidated
properties............................................. 11,622 8,221 38,596 29,150 28,134
The Company's share of depreciation and amortization from
unconsolidated real estate partnerships................ 2,710 2,741 11,100 13,010 12,832
Less:
Minority interest portion of depreciation and
amortization.............................................. (231) (89) (433) -- --
--------- --------- --------- --------- -----------
Funds from Operations...................................... $ 22,564 $ 18,046 $ 75,842 $ 65,792 $ 58,257
--------- --------- --------- --------- -----------
--------- --------- --------- --------- -----------
</TABLE>

RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS

COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1997 TO THREE MONTHS ENDED MARCH
31, 1996.

The ratio of earnings to combined fixed charges and preferred stock
dividends decreased to $1.59 for the three months ended March 31, 1997 compared
to 1.99 for the three months ended March 31, 1996. This decrease is mainly due
to approximately $2.0 million in distributions on preferred stock issued on July
1, 1996, an increase in interest expense of approximately $5.4 million offset by
an increase in net income of approximately $1.3 million and an increase in
distributions from unconsolidated real estate partnerships in excess of related
earnings of approximately $2.0 million.

COMPARISON OF YEAR ENDED DECEMBER 31, 1996 TO YEAR ENDED DECEMBER 31, 1995

The ratio of earnings to combined fixed charges and preferred stock
dividends decreased to 1.60 for the year ended December 31, 1996 compared to
2.25 for the year ended December 31, 1995. This decrease is due primarily to an
increase in interest expense in 1996 compared to 1995 of approximately $12.3
million, payment of approximately $4.3 million of distributions on preferred
stock issued in 1996, offset by an increase in income before taxes and minority
interest of approximately $2.9 million.

COMPARISON OF YEAR ENDED DECEMBER 31, 1995 TO PERIOD FROM FEBRUARY 12, 1994
THROUGH DECEMBER 31, 1994

The ratio of earnings to combined fixed charges and preferred stock
dividends decreased to 2.25 for the year ended December 31, 1995 compared to
2.89 for the period from February 12, 1994 through December 31, 1994. This
decrease is due to an increase in net income of approximately $6.6 million,
offset by a decrease of approximately $13.4 million in distributions from
unconsolidated real estate partnerships and an increase in interest expense of
approximately $3.8 million.

60
<PAGE>
PORTFOLIO DATA

REPORTED TENANT SALES VOLUME AND SALES PER SQUARE FOOT. From 1994 to 1996,
reported sales for Mall Stores (excluding the recently redeveloped Eastland
Center) increased from $1,487 million to $1,591 million, an average annual
compound growth rate of 3%. Total sales for Mall Stores affect revenue and
profitability levels of the Company because they determine the amount of minimum
rent the Company can charge, the percentage rent it realizes, and the
recoverable expenses (common area maintenance, real estate taxes, etc.) the
tenants can afford to pay.

The following illustrates total sales for Mall Stores:

<TABLE>
<CAPTION>
ANNUAL
FOR YEAR ENDED DECEMBER 31, PERCENTAGE INCREASE
- --------------------------------------------------------- TOTAL SALES FOR -----------------------
MALL STORES
---------------
(IN MILLIONS)
<S> <C> <C>
1994..................................................... $ 1,487 --
1995..................................................... 1,533 3.1%
1996..................................................... 1,591 3.8
</TABLE>

Reported sales per square foot for Mall Stores located at Centers under
Westfield Holdings's management (excluding the recently redeveloped Eastland
Center) for the years 1994 to 1996 were as follows:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
-------------------------------
1996 1995 1994
--------- --------- ---------
<S> <C> <C> <C>
Reported sales per square foot.............................. $ 297 $ 279 $ 263
Increase from prior year.................................... 6.5% 6.1% --
</TABLE>

If North County is included reported sales per square foot for Mall Stores
located at Centers (excluding the recently redeveloped Eastland Center) for the
years 1994 to 1996 were as follows:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
-------------------------------
1996 1995 1994
--------- --------- ---------
<S> <C> <C> <C>
Reported sales per square foot.............................. $ 300 $ 280 $ 266
Increase from prior year.................................... 7.1% 5.3% --
</TABLE>

In 1996, the Centers under Westfield Holdings's management (including the
Acquired Properties as if they were owned by the Company during such period but
excluding the recently redeveloped Eastland Center) reported average Mall Store
sales psf of $297 (including North County Fair, sales psf of $300) as compared
to an industry average of $278 psf for the same period (Source: ICSC Monthly
Mall Merchandise Index, February 1997).

As reflected in the above table, the increase in sales per square foot from
1994 to 1996 for Mall Stores located at Centers under Westfield Holdings's
management (excluding the recently redeveloped Eastland Center) was 13%.

The Company believes these sales levels enhance the Company's ability to
obtain higher rents from tenants.

LEASING

The amount of leased Mall Store space at Stabilized Centers (including the
Acquired Properties as if they were owned by the Company as of December 31,
1994) increased each year from 88% at December 31, 1994 to 92% (88% to 91%,
including North County Fair) at December 31, 1996, excluding temporary leases
with durations of less than one year. The Company excludes temporary leasing
from the calculation of leased Mall Store space since such leases are on a
short-term team basis (30 days to 11 months) and are subject to termination by
the Company on 30 days' notice.

61
<PAGE>
TENANT OCCUPANCY COSTS

A tenant's ability to pay rent is affected by the percentage of its sales
represented by occupancy costs, which consist of base rents and expense
recoveries. As sales levels increase, if expenses subject to recovery are
controlled, the tenant can pay higher rent. From 1994 to 1996 recoverable
expenses remained relatively constant while sales per square foot continued to
increase. This has permitted base rents to increase without raising a tenant's
total occupancy cost beyond its ability to pay.

The following table illustrates occupancy cost as percentage of sales for
reporting tenants for 1996 and 1995:

<TABLE>
<CAPTION>
(INCLUDING NORTH (EXCLUDING NORTH
COUNTY FAIR) FOR THE COUNTY FAIR) FOR THE
YEARS ENDED DECEMBER YEARS ENDED DECEMBER
31, 31,
-------------------- --------------------
1996 1995 1996 1995
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Mall Stores
Base rents......................................... 8.6% 8.9% 8.5% 8.7%
Expense recoveries................................. 4.6 4.8 4.7 4.9
--- --- --- ---
Total............................................ 13.2% 13.7% 13.2% 13.6%
--- --- --- ---
--- --- --- ---
</TABLE>

As a result of these factors, the average effective (base plus percentage)
rents for Mall Stores located at Centers under Westfield Holdings's management
(including the Acquired Properties as if they were owned by the Company as of
December 31, 1994) increased from 1994 to 1996. Effective rents per square foot
of Mall Stores located at Centers under Westfield Holdings's management
increased 8% during this period (including North County Fair, 7%). The following
highlights this trend:

<TABLE>
<CAPTION>
(INCLUDING NORTH (EXCLUDING NORTH
COUNTY FAIR) AVERAGE COUNTY FAIR) AVERAGE
EFFECTIVE RENT PER EFFECTIVE RENT PER
SQUARE FOOT SQUARE FOOT
---------------------- ----------------------
MALL MALL
AS OF DECEMBER 31, STORES % CHANGE STORES % CHANGE
- -------------------------------------------- --------- ----------- --------- -----------
<S> <C> <C> <C> <C>
1992........................................ $ 21.73 -- $ 21.29 --
1993........................................ 22.84 5.1% 22.50 5.7%
1994........................................ 25.77 12.3 25.55 13.6
1995........................................ 26.51 2.9 26.33 3.1
1996........................................ 27.50 3.7 27.62 4.9
</TABLE>

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
AVERAGE BASE RENT PER SQUARE FOOT MALL
STORES
<S> <C>
Dollars Per Square Ft
1994 $25
1995 $26
1996 $28
</TABLE>

LIQUIDITY AND CAPITAL RESOURCES

On a pro forma basis as of March 31, 1997, after giving effect to the
Offerings and concurrent transactions and the application of the proceeds
thereof, the Company's consolidated indebtedness is

62
<PAGE>
expected to increase from approximately $783.3 million to approximately $858.3
million. The maturity dates of such indebtedness range from 1999 to 2014. The
Company's ratio of debt-to-Total Market Capitalization would be approximately
44% on a pro forma basis as of March 31, 1997. The interest rate on the
fixed-rate debt ranges from 6.15% to 8.09%. See "Debt Summary." After the
Offerings, scheduled principal amortization and balloon payments in connection
with maturing mortgage indebtedness over the next five years and thereafter are
set forth in the table below:

<TABLE>
<CAPTION>
YEAR
- ------------------------------------------------------------------------------ AMOUNT
--------------
(IN THOUSANDS)
<S> <C>
1997.......................................................................... $ 4,944
1998.......................................................................... 7,022
1999.......................................................................... 194,542
2000.......................................................................... 418,549
2001.......................................................................... 170,157
Thereafter.................................................................... 63,048
</TABLE>

The Company has also entered into interest rate exchange agreements to
manage future interest rates. These agreements consists of swaps and involve the
future receipt, corresponding with the expiration of existing fixed rate
mortgage debt, of a floating rate based on LIBOR and the payment of a fixed
rate. At December 31, 1996, the Company had interest rate exchange agreements
beginning February 11, 1999 and expiring after three years with notional
principal amounts totaling $90.0 million which provide that the Company will pay
6.125% per annum. Subsequently, the Company entered into interest rate exchange
agreements beginning in February 1999 and April 2000 and expiring at various
dates in 2002 with notional principal amounts totaling $227.0 million which
provide that the Company will pay 6.25% per annum. These exchange rate
agreements ensure that, upon the expiration of certain of the Company's mortgage
debt, if the Company refinances such debt with new LIBOR based loans, the
interest rate on such loans will be no more than 6.125% or 6.25%, plus the
applicable spread of the loan at such time.

The historical sources of capital used to fund the Company's operating
expenses, interest expense, recurring capital expenditures and non-recurring
capital expenditures (such as major building renovations and expansions) have
been: (i) Funds from Operations, (ii) property financing and (iii) capital
contributions. The Company anticipates that all development projects, expansion
projects and potential acquisitions will be funded by external financing
sources.

Capital expenditures were $44.1 million, $12.8 million and $32.1 million for
the years ended December 31, 1996, 1995 and 1994, respectively. The following
table shows the components of capital expenditures.

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER
31,
-------------------------------
1996 1995 1994
--------- --------- ---------
(IN MILLIONS)
<S> <C> <C> <C>
Renovations and expansions........................................... $ 39.0 $ 8.3 $ 27.1
Tenant allowances.................................................... 5.0 4.1 4.1
Other capital expenditures........................................... 0.1 0.4 0.9
--------- --------- ---------
Total............................................................ $ 44.1 $ 12.8 $ 32.1
--------- --------- ---------
--------- --------- ---------
</TABLE>

63
<PAGE>
Capital expenditures were financed by external funding and recovery of costs
from tenants where applicable. The Company is currently involved in several
development projects and had outstanding commitments with contractors totaling
approximately $35.8 million as of December 31, 1996, which will be funded
through existing mortgage debt and the secured revolving credit facility
discussed below.

The Company anticipates that its Funds from Operations will provide the
necessary funds on a short-and long-term basis for its operating expenses,
interest expense on outstanding indebtedness and all distributions to the
shareholders in accordance with the REIT Requirements. Sources of recurring and
non-recurring capital expenditures on a short-term and long-term basis, such as
major building renovations and expansions, as well as for scheduled principal
payments, including balloon payments on outstanding indebtedness are expected to
be obtained from: (i) additional debt financing, (ii) additional equity and
(iii) working capital reserves.

The Company also may obtain additional funds for future acquisitions and
development through borrowings, the issuance of equity securities or partnership
arrangements. Certain acquisitions may be undertaken through the issuance of
additional equity securities. The Company intends to incur additional
indebtedness in a manner consistent with its policy of maintaining a
debt-to-Total Market Capitalization ratio of not more than 50%. The Company
intends to access debt financing from the capital markets on a secured or
unsecured basis.

As of March 31, 1997, the Company's balance of cash and cash equivalents was
$2.6 million, not including its proportionate share of cash held by
unconsolidated real estate partnerships. The Company currently has a $50.0
million unsecured revolving credit facility. The Company has entered into a
letter of intent for a new $600.0 million unsecured revolving credit facility
with National Australia Bank Limited, Australia and New Zealand Banking Group
Limited, Commonwealth Bank of Australia, and Union Bank of Switzerland, of which
approximately $163.0 million will be used to refinance existing secured debt and
the balance will be used for the Company's redevelopment and acquisition
activities, as well as working capital, capital costs and general corporate
purposes. There can be no assurance that a definitive credit agreement with
respect to this loan facility will be entered into. For a further description of
the proposed credit facility see "Business and Properties--Debt Summary."

Although no assurance can be given, the Company believes that it will have
access to capital resources sufficient to satisfy the Company's cash
requirements and expand and develop its business in accordance with its strategy
for growth.

INFLATION

Inflation has remained relatively low during the past three years and has
had a minimal impact on the operating performance of the Properties.
Nonetheless, substantially all of the tenants' leases contain provisions
designed to lessen the impact of inflation. Such provisions include clauses
enabling the Company to receive percentage rentals based on tenants' gross
sales, which generally increase as prices rise, and/or escalation clause, which
generally increase rental rates during the terms of the lease. In addition, many
of the leases are for terms of less than ten years, which may enable the Company
to replace existing leases with new leases at higher base and/or percentage
rentals if rents of the existing leases are below the then-existing market rate.
Substantially all of the leases, other than those for anchors, require the
tenants to pay a proportionate share of operating expenses, including common
area maintenance, real estate taxes and insurance, thereby reducing the
Company's exposure to increases in cost and operating expenses resulting from
inflation.

However, inflation may have a negative impact on some of the Company's other
operating items. Interest and general and administrative expenses may be
adversely affected by inflation as these specified costs could increase at a
rate higher than rents. Also, for tenant leases with stated rent increases,
inflation may have a negative effect as the stated rent increases in these
leases could be lower than the increase in inflation at any given time.

64
<PAGE>
SEASONALITY

The shopping center industry is seasonal in nature, particularly in the
fourth quarter during the holiday season, when tenant occupancy and retail sales
are typically at their highest levels. In addition, shopping malls achieve most
of their temporary tenant rents during the holiday season. As a result of the
above, earnings are generally highest in the fourth quarter of each year.

BUSINESS AND PROPERTIES

GENERAL

The Company's portfolio consists of interests in 13 super regional shopping
centers, six regional shopping centers and three Power Centers, the May
Properties and certain other real estate investments.

THE SHOPPING CENTER BUSINESS

According to "The Scope of the Shopping Center Industry in the United States
1996" as published by the ICSC, retail shopping centers accounted for
approximately 58% of retail sales in the United States (excluding sales by
automotive dealers and gasoline service stations), or an estimated $914.2
billion, in 1996. The ICSC divides shopping centers into various categories
including, among others, super regional shopping centers which are greater than
800,000 square feet of total gross leasable area, regional shopping centers
ranging from 400,000 to 800,000 square feet of total gross leasable area, and
power centers ranging from 250,000 to 600,000 square feet of total gross
leasable area.

Most regional and super regional shopping centers compete for consumer
retail dollars by offering fashion merchandise, hard goods and services,
generally in an enclosed, climate-controlled environment with convenient
parking. Regional and super regional shopping centers have differing strategies
for price levels depending upon the market demographics, competition and the
merchants and merchandise offered, from very high-end presentations, on the one
extreme, to a strategy of leasing exclusively to promotional, single category
outlet stores, on the other. Super regional shopping centers generally have more
variety and assortment than regional shopping centers.

The Company owns interests in 13 super regional shopping centers, with
approximately 14.0 million square feet of Total GLA, representing 72.9% of the
Total GLA. According to the ICSC, nationwide there are approximately 680 super
regional shopping centers, representing 1.7% of shopping centers across the
country.

The Company owns interests in six regional shopping centers with
approximately 3.7 million feet of Total GLA, representing 19.5% of the Total
GLA. According to the ICSC, nationwide there are approximately 1,235 regional
shopping centers representing 3% of shopping centers across the country.

Power centers tend to have category-dominant anchors and few small tenants.
The Company has three Power Centers, including Eastland Center which was
recently converted from a regional shopping center. The Company is also planning
to build a power center on land adjacent to Topanga Plaza and to redevelop the
existing Power Center known as Mission Valley Center-West into a value-oriented
power center. The Power Centers have approximately 1.5 million square feet of
Total GLA, representing 7.6% of Total GLA.

INDUSTRY TRENDS AND THE COMPANY'S MERCHANDISING

The Manager continually monitors and analyzes trends in the Centers and the
industry as a whole. The Manager's in-house research, marketing, merchandising,
and leasing professionals work together to identify retail trends and seek to
merchandise and lease the Centers in response to those market trends. The
following significant industry trends have been identified.

Over the past six years, the Manager has identified a major fashion shift in
ready-to-wear with women's fashion retailers decreasing from approximately 24%
to 19.8% of Mall GLA. The trend to casual dressing and the resulting consumer
interest in value-oriented ready-to-wear, including casual and athletic
footwear, has changed the nature of fashion in the Centers. The trend has moved
from women's ready-to-

65
<PAGE>
wear to unisex apparel with unisex retailers increasing from 8.2% to 14.7% of
Mall GLA over the period. The Manager has sought out unisex tenants such as
Eddie Bauer, J. Crew, The Gap, Banana Republic, American Eagle and others.

New retailers are revitalizing the merchandise variety available at the
Centers, including The Disney Store, Starbucks, Garden Botanika, Coach Leather,
The Museum Company, Warner Bros., Crate and Barrel, The Nature Company, The
Bombay Company, and California Pizza Kitchen.

Successful retailers (including The Gap, Banana Republic and The Limited)
are expanding their formats into larger stores and combining stores such as The
Gap, Gap Kids and the Baby Gap.

There has been a recent "baby-boom" in the U.S., in years 1989-1993, births
have exceeded four million for the first time since the early 1960's; there are
now 20 million Americans between the ages of four and eight. As a result of this
new "baby-boom," the Manager is making a special effort to attract children's
ready-to-wear (i.e., Gap Kids, Baby Gap, and Gymboree) and related kids'
retailers (toys, software, videos), to its Centers. Marketing has also been
tailored to attract this young market and their parents through strategies such
as "Kids Clubs" and mall promotions.

The Manager is merchandising the Centers today to take advantage of the fast
growing teenage market. There are 37 million teens in the U.S., and there has
been a fashion shift to more stylish, junior ready-to-wear. Also, as the new
"baby-boomers" reach their teenage years the Manager believes such tenants as
Wet Seal, Contempo Casuals, Rampage/Friends, Pacific Sunwear, Claire's Store and
The Limited will benefit from these demographic trends.

The Manager and the Company are optimistic about the future of the regional
shopping center business because the consolidation of the department stores in
recent years provides the Centers with financially stronger anchor stores. Also,
the new innovative retailers entering the Centers offer greater merchandise
selection for the shopper. The Company believes the demographic trends described
above will be beneficial to the fashion retailers in the same manner that the
first generation of "baby-boomers" that were fashion oriented drove the dramatic
growth of the shopping industry in the 1970's and 1980's.

THE CENTERS

As set forth in the following table, the Company's portfolio consists of
interests in 13 super regional shopping centers, six regional centers and three
Power Centers located in seven states in the East Coast, the Mid West, and the
West Coast regions of the United States and totalling 19.2 million square feet
of Total GLA. In addition, the Company has an option to acquire the stock of
Westland Realty, Inc., the holder of an indirect 50% interest in Garden State
Plaza pursuant to the Garden State Plaza Option.

66
<PAGE>
CENTER PROFILE
<TABLE>
<CAPTION>
PERCENTAGE OF
MALL GLA
LEASED AT 1996 MALL STORE HISTORY AND
SHOPPING CENTER AND PERCENTAGE TOTAL GLA MALL GLA DECEMBER 31, SALES STATUS OF
LOCATION(1) OWNERSHIP (SQ. FT.) SQ. FT. 1996 (PER SQ. FT.)(2) DEVELOPMENT
- ------------------------------ ------------ ----------- ----------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
EAST COAST
Annapolis Mall,(5) ........... 30 990,702 408,554 96 $ 371 Opened 1980
Annapolis, Maryland Redeveloped
1983/1994

Connecticut Post Mall,(6) .... 100 831,707 438,405 91 298 Opened 1960
Milford, Connecticut Redeveloped 1991

Enfield Square,(6)(7) ........ 100 678,822 260,632 76 215 Opened 1971
Enfield, Connecticut Redeveloped
1987/1997

Meriden Square, .............. 50 746,695 294,654 92 330 Opened 1971
Meriden, Connecticut Redeveloped
1988/1993

Montgomery Mall, ............. 100 1,253,482 467,872 97 405 Opened 1968
Bethesda, Maryland Redeveloped
1976/1982/1984
1991

South Shore Mall,(7)(8) ...... 100 1,108,111 370,962 92 292 Opened 1963 Under
Bay Shore, New York Redevelopment

Trumbull Shopping Park, ...... 100 1,160,716 464,088 86 314 Opened 1964
Trumbull, Connecticut Redeveloped
1982/1987/1990
1992
----------- ----------- --

Total(8).................. 6,770,235 2,705,167 92
----------- ----------- --

<CAPTION>
TRADE AREA
POPULATION
(000S)(3)/
AVERAGE ANNUAL
SHOPPING CENTER AND HOUSEHOLD MAJOR RETAILERS AND
LOCATION(1) INCOME $(4) SPECIAL FEATURES
- ------------------------------ --------------- ---------------------
<S> <C> <C>
EAST COAST
Annapolis Mall,(5) ........... 450/ Nordstrom, Hecht's,
Annapolis, Maryland $63,400 J.C. Penney,
Montgomery Ward
Connecticut Post Mall,(6) .... 430/ Filene's, J.C.
Milford, Connecticut $54,600 Penney, Caldor
Enfield Square,(6)(7) ........ 312/ Filene's, J.C.
Enfield, Connecticut $53,700 Penney. Sears
scheduled to open
Spring 1997.
Meriden Square, .............. 396/ Filene's, J.C.
Meriden, Connecticut $54,800 Penney, Sears
Montgomery Mall, ............. 612/ Nordstrom, Hecht's,
Bethesda, Maryland $79,900 Sears, J.C. Penney
South Shore Mall,(7)(8) ...... 495/ Macy's, J.C. Penney,
Bay Shore, New York $66,500 Sears scheduled to
open Fall 1997
Trumbull Shopping Park, ...... 536/ Macy's, Filene's,
Trumbull, Connecticut $71,400 Lord & Taylor, J.C.
Penney
Total(8)..................
</TABLE>

67
<PAGE>
<TABLE>
<CAPTION>
PERCENTAGE OF
MALL GLA LEASED
AT 1996 MALL STORE HISTORY AND
SHOPPING CENTER AND PERCENTAGE TOTAL GLA MALL GLA DECEMBER 31, SALES STATUS OF
LOCATION(1) OWNERSHIP (SQ. FT.) (SQ. FT.) 1996 (PER SQ. FT.)(2) DEVELOPMENT
- ------------------------------ ------------ ----------- ----------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
MID WEST
Mid Rivers Mall,(7) .......... 100 929,185 352,371 87 248 Opened 1987
St. Peters, Missouri Redeveloped
1990/1996

South County Center,(6) ...... 100 754,063 259,360 93 270 Opened 1963
St. Louis, Missouri Redeveloped 1979

West County Center, .......... 100 583,646 152,590 95 267 Opened 1969
Des Peres, Missouri Redeveloped 1985

West Park Mall, .............. 100 502,856 230,505 92 212 Opened 1981
Cape Girardeau, Missouri Redeveloped 1984

Westland Towne Center, ....... 100 470,943 137,520 95 175 Opened 1960
Lakewood, Colorado Redeveloped
1979/1994
----------- ----------- --

Total..................... 3,240,693 1,132,346 93
----------- ----------- --

WEST COAST

Eagle Rock Plaza, ............ 100 474,230 163,912 81 177 Opened 1973
Los Angeles, California

Eastland Center,(7) .......... 100 819,244 617,444 76 -- Opened 1957
West Covina, California Redeveloped
1979/1996/1997
(substantially
completed)

Mission Valley Center, ....... 76 1,340,410 508,492 96 283 Opened 1961
San Diego, California Redeveloped
1975/1983
1996/1997

Mission Valley 76 178,624 178,624 82 283 Opened 1961
Center-West,(7) . Under
San Diego, California Redevelopment

North County Fair,(9) ........ 45 1,243,551 363,054 79 316 Opened 1986
Escondido, California

Total.....................

WEST COAST
Eagle Rock Plaza, ............ 525/ Robinsons-May,
Los Angeles, California $50,500 Montgomery Ward
Eastland Center,(7) .......... 528/ Mervyn's, Target
West Covina, California $52,600

Mission Valley Center, ....... 936/ Robinsons-May,
San Diego, California $48,600 Macy's, Montgomery
Ward, AMC 20-screen
theater, Nordstrom
Rack
Mission Valley 936/
Center-West,(7) . $48,600
San Diego, California
North County Fair,(9) ........ 743/ Nordstrom,
Escondido, California $54,700 Robinsons-May (2),
Macy's, J.C. Penney,
Sears
</TABLE>

68
<PAGE>
<TABLE>
<CAPTION>
PERCENTAGE OF
MALL GLA LEASED
AT 1996 MALL STORE HISTORY AND
SHOPPING CENTER AND PERCENTAGE TOTAL GLA MALL GLA DECEMBER 31, SALES STATUS OF
LOCATION(1) OWNERSHIP (SQ. FT.) (SQ. FT.) 1996 (PER SQ. FT.)(2) DEVELOPMENT
- ------------------------------ ------------ ----------- ----------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Plaza Bonita, ................ 100 822,075 313,248 94 304 Opened 1981
National City, California

Plaza Camino Real, ........... 40 1,152,194 433,984 92 275 Opened 1969
Carlsbad, California Redeveloped
1979/1989

The Plaza at West Covina, .... 100 1,233,582 585,488 91 256 Opened 1975
West Covina, California Redeveloped
1990/1993

Topanga Plaza, ............... 42 1,085,038 373,006 95 332 Opened 1964
Canoga Park, California Redeveloped
1984/1992/1994

Vancouver Mall, .............. 50 870,141 328,575 88 243 Opened 1977
Vancouver, Washington Redeveloped
1979/1993
----------- ----------- --

Total..................... 9,219,089 3,865,827 92(10)
----------- ----------- --

Grand Total(8).......... 19,230,017 7,703,340 92(10)
----------- ----------- --
----------- ----------- --

<CAPTION>
TRADE AREA
POPULATION
(000S)(3)/
AVERAGE ANNUAL
SHOPPING CENTER AND HOUSEHOLD MAJOR RETAILERS AND
LOCATION(1) INCOME $ (4) SPECIAL FEATURES
- ------------------------------ --------------- ---------------------
<S> <C> <C>
Plaza Bonita, ................ 696/ Robinsons-May, J.C.
National City, California $41,800 Penney, Montgomery
Ward and Mervyn's
Plaza Camino Real, ........... 475/ Macy's (2),
Carlsbad, California $52,300 Robinsons- May,
Sears, J.C. Penney
The Plaza at West Covina, .... 679/ Robinsons-May,
West Covina, California $54,900 Macy's, Sears, J.C.
Penney
Topanga Plaza, ............... 846/ Nordstrom,
Canoga Park, California $66,900 Robinsons-May, Sears,
Montgomery Ward
Vancouver Mall, .............. 278/ Nordstrom, Meier &
Vancouver, Washington $43,500 Frank, Sears, J.C.
Penney, Mervyn's
Total.....................
Grand Total(8)..........
</TABLE>

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

(1) For a description of the mortgage encumbrances on each Center, see "Business
and Properties--Debt Summary." All of the Centers are managed by Westfield
Holdings Limited other than North County Fair which is managed by Trizec
Hahn Corporation Limited.

(2) Sales are based on reports of Mall Store tenants reporting sales; Mall Store
sales are not provided for Eastland Center as such Center was under
redevelopment for all of 1996. Mall Store sales for Mission Valley Center
and Mission Valley Center - West are calculated on an aggregate basis for
such Centers. For Mall Store sales per square foot for 1994 and 1995 at such
Centers, see "Business and Properties--The East Coast Properties," "Business
and Properties--The Mid West Properties" and "Business and Properties--The
West Coast Properties."

(3) Trade Area Population means the number of people that reside in a
geographically defined area surrounding the shopping center that equates to
approximately 70% to 80% of the Centers' customer draw.

(4) U.S. national average household income $44,799. All figures are 1994
estimates provided by Equifax National Decisions Systems.

(5) The Company has entered into a letter of intent to purchase the remaining
70% interest in Annapolis Mall from its Joint Venture partner.

(6) The Company's interest in this Center includes certain incidental long-term
ground leases.

(7) Under redevelopment.

(8) After giving effect to the South Shore Mall redevelopment anticipated to be
completed in Fall 1997.

(9) The Joint Venture which owns this Center leases it from the City of
Escondido pursuant to a 50-year ground lease which expires in 2033. This
Center is not managed by Westfield Holdings.

(10) Total and Grand Total are for Stabilized Centers and exclude North County
Fair as such Center is not managed by Westfield Holdings.

69
<PAGE>
The following table sets forth the number of Centers in each State and the
Total GLA per State for such Centers.

<TABLE>
<CAPTION>
PERCENT OF TOTAL
STATE OF SHOPPING CENTER LOCATIONS NO. OF SHOPPING CENTERS TOTAL GLA GLA
- ---------------------------------------------- ----------------------- ---------- -------------------
<S> <C> <C> <C>
California.................................... 9 8,348,900 43%
Colorado...................................... 1 470,900 2
Connecticut................................... 4 3,417,900 18
Maryland...................................... 2 2,244,200 12
Missouri...................................... 4 2,769,800 14
New York...................................... 1 1,108,100 6
Washington.................................... 1 870,100 5
</TABLE>

Business highlights of the operation and performance of the Centers include
the following:

- Successful redevelopment of a number of the Centers has generated
increased returns. The Company is in the process of redeveloping South
Shore Mall and anticipates that the redevelopment of Mission Valley
Center--West will commence in the second quarter of 1997. In addition, the
Company is currently planning the redevelopment of eight additional
Properties.

- In 1996, the Centers under Westfield Holdings's management (excluding the
recently redeveloped Eastland Center) reported average Mall Stores sales
psf of $297 (and including North County Fair, $300 psf for the same
period) as compared to an industry average of $278 psf for the same period
(Source: ICSC Monthly Mall Merchandise Index, February 1997).

- Mall GLA at Stabilized Centers was leased 92% as of December 31, 1996
(and, including North County Fair, 91% leased).

- A significant concentration of Centers in California (43% of the Total GLA
of the Centers as of December 31, 1996) provides an excellent opportunity
to take advantage of that state's recent economic recovery.

- The Centers have 74 Anchors operating under 18 trade names. The portfolio
includes 20 May Company stores (Famous-Barr, Filene's, Hecht's, Lord &
Taylor, Meier & Frank, and Robinsons-May), 16 J.C. Penneys, 11 Sears,
seven Federated (Macy's) and five Nordstrom stores. In addition, other
major Anchors include Dillard's, Dayton Hudson (Mervyn's, Target) and
Montgomery Ward. The Manager's strong relationships with these Anchors
enhance the Company's opportunities by providing substantial pre-leasing
of new projects, lease-up of existing space, improved tenant retention and
releasing opportunities. For a description of the total 1996 annualized
base rent and the percentage of Total GLA for such Anchors, see "Business
and Properties--Anchors."

- In 1996, the Centers derived approximately 95% of their base rents from
Mall Stores. Mall Stores occupied approximately 40.1% of the Total GLA,
and the balance of Total GLA was represented by

70
<PAGE>
Anchors and outparcel stores. No Mall Store retailer accounted for more
than 5% of Mall GLA or more than 6% of the Company's 1996 annualized
effective rent (I.E., base plus percentage rent), except for The Limited
Stores, a clothing retailer, which occupied approximately 10% of Mall GLA
and accounted for 11% of the 1996 Mall Store annualized effective rent.

THE EAST COAST PROPERTIES

The East Coast portfolio consists of interests in four Centers in
Connecticut, two in Maryland and one in New York. The East Coast properties are
well located in areas with large populations and generally middle to high
incomes. Connecticut has a population of more than 3.3 million, Long Island, New
York has 2.7 million and the greater Washington, D.C. area has 5.2 million
people. Many of the Centers have significant development opportunities over the
next 10 years. While competition is generally strong, Centers such as Annapolis
Mall, Montgomery Mall and Trumbull Shopping Park have established a competitive
advantage because of their strong department store and specialty store tenant
mix. For example, Montgomery Mall is differentiated from its competition by
having the only Nordstrom store in its market and a distinctive tenant mix.
Annapolis Mall, with its upscale suburban market, has the only Nordstrom store
in its Primary Trade Area.

CONNECTICUT SUPER REGIONAL SHOPPING CENTERS

CONNECTICUT POST MALL. Connecticut Post Mall is located in Milford,
Connecticut, at the intersection of Interstate 95 and Boston Post Road, and has
a significant market share of the greater New Haven market. The Center, which
opened in 1960, was last redeveloped in 1991 by adding J.C. Penney, Filene's and
a new food court. The enclosed, two-level mall has 831,707 square feet of Total
GLA on a 79-acre site, with 137 Mall Stores and three Anchors: Filene's, J.C.
Penney and Caldor. The Company anticipates that further redevelopment could
include the addition of up to two more anchors and additional Mall GLA. The
Company owns 100% of the Center. Mall Store sales per square foot (based on Mall
Store tenants reporting sales) were $297, $297 and $298 for 1994, 1995 and 1996,
respectively.

TRUMBULL SHOPPING PARK. Trumbull Shopping Park is located in Trumbull,
Connecticut, near the Merritt Parkway and serves the affluent Fairfield County
communities. The Center, which opened in 1964, has undergone multiple
redevelopments, including a significant redevelopment in 1992 which added Lord &
Taylor and 10,000 square feet of additional Mall GLA. The two-level Center has
approximately 1.2 million square feet of Total GLA on a 78-acre site, with 176
Mall Stores and four Anchors: Macy's, Filene's, Lord & Taylor and J.C. Penney.
The Company believes that there is redevelopment potential with the addition of
a third level of specialty stores. The Company owns 100% of the Center. Mall
Store sales per square foot (based on Mall Store tenants reporting sales) were
$271, $307 and $314 for 1994, 1995 and 1996, respectively.

CONNECTICUT REGIONAL SHOPPING CENTERS

ENFIELD SQUARE. Enfield Square is located in Enfield, Connecticut, 15 miles
north of downtown Hartford, Connecticut, along Interstate 91 and serves North
Hartford County. The Center, which opened in 1971, was last renovated in 1987,
and is currently under redevelopment with the addition of Sears as a new anchor
scheduled for Spring 1997. Upon completion of redevelopment, the one-level
Center will have 678,822 square feet of Total GLA on a 104-acre site, with 81
Mall Stores and three Anchors: Filene's and J.C. Penney and a new Sears store.
The Company believes that potential redevelopment exists for a possible fourth
anchor and an additional Mall GLA. The Company owns 100% of the Center. Mall
Store sales per square foot (based on Mall Store tenants reporting sales) were
$215, $211 and $215 for 1994, 1995 and 1996, respectively.

MERIDEN SQUARE. Meriden Square is located in Meriden, Connecticut, 20 miles
southwest of downtown Hartford, Connecticut, and serves New Haven County. The
Center, which opened in 1971, was last redeveloped in 1993 with the addition of
Sears and 100,000 square feet of Mall GLA. This two-level Center has 746,695
square feet of Total GLA on a 63-acre site, with 113 Mall Stores and three
Anchors: Filene's, J.C. Penney and Sears. The Company believes that further
redevelopment may include the addition of a fourth anchor and an expansion of
Mall GLA. Mall Store sales per square foot (based on Mall Store tenants
reporting sales) were $292, $309 and $330 for 1994, 1995 and 1996, respectively.

71
<PAGE>
The Company is a 50% general partner in Meriden Square, under a partnership
agreement expiring in 2058 with two entities that together comprise the other
50% general partner interest. Each partner may only sell the Center with the
consent of the other or after offering its interest to the other partner where
the partner elects not to purchase.

MARYLAND/WASHINGTON, D.C. SUPER REGIONAL SHOPPING CENTERS

ANNAPOLIS MALL. Annapolis Mall is located in Annapolis, Maryland, the home
of the U.S. Naval Academy and a popular tourist destination, 20 miles east of
the Washington, D.C. metropolitan area. The Center, which opened in 1980, was
redeveloped in 1994 with the addition of Nordstrom and 100,000 square feet of
Mall GLA. At that time the Center was also renovated and repositioned with
upscale specialty stores to complement Nordstrom. The 1994 redevelopment and
repositioning significantly expanded the Center's trade area and enabled
Annapolis Mall to hold a significant market share. The one-level Center has
990,702 square feet of Total GLA on a 93-acre site, with 151 Mall Stores and
four Anchors: Hecht's, Montgomery Ward, J.C. Penney and Nordstrom. There is
early redevelopment planning for the addition of a fifth anchor. The Company
believes that two additional anchors and Mall GLA can be added to the Center.
Mall Store sales per square foot (based on Mall Store tenants reporting sales)
were $280, $336 and $371 for 1994, 1995 and 1996, respectively.

The Company is a 30% general partner in Annapolis Mall. Under the terms of
the partnership agreement expiring May 1, 2078, neither joint venture partner
may dispose of an interest except (i) to an affiliate, (ii) in connection with
the merger, consolidation, or sale or substantially all the assets or (iii)
subject to a right of first refusal. The agreement contains buy-sell provisions
with respect to partnership interests in the event of a deadlock as to the sale
of the Center, refinancing or the identity of a department store operator.
Neither joint venture partner may mortgage its partnership interest. The Company
has entered into a letter of intent with its Joint Venture partner to acquire
the remaining 70% interest in Annapolis Mall and an adjoining parcel of real
property leased to Montgomery Ward & Co., for an aggregate purchase price of
$133.0 million. See "The Company--The Company's Strategy for Operation and
Growth Acquisition of New Centers and Joint Venture Interests."

MONTGOMERY MALL. Montgomery Mall is located in Bethesda, Maryland, and
serves Montgomery County. The Center, which opened in 1968, was expanded and
redeveloped in 1991 with the addition of a Nordstrom and a new fashion retail
wing. The repositioning of the Center includes serving the high income
demographics of the market and additional upscale merchandise to better
compliment Nordstrom. The Center has approximately 1.25 million square feet of
Total GLA on a 58-acre site, with 178 Mall Stores and four Anchors: Nordstrom,
Hecht's, Sears and J.C. Penney. The Center has the most significant market share
of the super regional shopping centers serving Montgomery County in Maryland.
The Company believes that additional anchors and Mall GLA can be added to the
Center. The Company owns 100% of the Center. Mall Store sales per square foot
(based on Mall Store tenants reporting sales) were $384, $397 and $405 for 1994,
1995 and 1996, respectively.

NEW YORK SUPER REGIONAL CENTER

SOUTH SHORE MALL. South Shore Mall is located in Bay Shore, New York in
Long Island near the Sunrise Highway. The Center, which opened in 1963, is
presently being expanded with a new Sears and 40,000 square feet of Mall GLA. As
part of its expansion, the Center is being renovated. The redevelopment is
expected to be completed in Fall 1997. Upon completion of the redevelopment, the
Center will have approximately 1.1 million square feet of Total GLA on a 84-acre
site, with 120 Mall Stores and three Anchors: J.C. Penney, Macy's and the new
Sears store. The Company owns 100% of the Center. Mall Store sales per square
foot (based on Mall Store tenants reporting sales) were $265, $282 and $292 for
1994, 1995 and 1996, respectively.

THE MID WEST PROPERTIES

The Mid West portfolio consists of interests in four Centers in Missouri and
one in Denver, Colorado. All of the Missouri Centers are easily accessible to
and readily visible from major interstate highways. Three of the Mid West
Properties are located in the St. Louis metropolitan area which has a population
of more than 2.5 million.

72
<PAGE>
MISSOURI/ST. LOUIS SUPER REGIONAL CENTER

MID RIVERS MALL. Mid Rivers Mall is located on Interstate 70 in St. Charles
County in the St. Peters, Missouri metropolitan area. The Center, which opened
in 1987, was redeveloped in 1990, and again in 1996. The 1996 redevelopment
resulted in an addition of 40,000 square feet of Mall GLA and added J.C. Penney.
The two-level Center has 929,185 square feet of Total GLA on a 78-acre site,
with 142 Mall Stores and Anchors all four major department stores that serve St.
Louis: Famous-Barr, Dillard's, Sears and J.C. Penney. The Company owns 100% of
the Center. Mall Store sales per square foot (based on Mall Store tenants
reporting sales) were $199, $226 and $248 for 1994, 1995 and 1996, respectively.

MISSOURI/ST. LOUIS REGIONAL CENTERS

SOUTH COUNTY CENTER. South County Center is located at the intersection of
Interstate 270 and Interstate 55 in St. Louis, Missouri, and serves the south
St. Louis and South County markets. The two-level Center, which opened in 1963,
has 754,063 square feet of Total GLA on a 73-acre site, with 102 Mall Stores and
three Anchors: Famous-Barr, Dillard's and J.C. Penney. Substantial redevelopment
planning is proceeding for the addition of a fourth anchor and additional
specialty stores. The Company owns 100% of the Center. Mall Store sales per
square foot (based on Mall Store tenants reporting sales) were $241, $258 and
$270 for 1994, 1995 and 1996, respectively.

WEST COUNTY CENTER. West County Center is located in Des Peres, Missouri,
on Interstate 270 and serves the affluent west county suburbs of St. Louis
County. The Center, which opened in 1969, has 583,646 square feet of Total GLA
on a 51-acre site, with 65 Mall Stores and two Anchors: Famous-Barr and J.C.
Penney. Substantial redevelopment planning is proceeding for the addition of a
fashion anchor, additional Mall GLA and the redevelopment of the existing Mall
GLA. The Company owns 100% of the Center. Mall Store sales per square foot
(based on Mall Store tenants reporting sales) were $244, $247 and $267 for 1994,
1995 and 1996, respectively.

WEST PARK MALL. West Park Mall is located in southeast Missouri in Cape
Girardeau. The Center serves a geographically large Primary Trade Area and is
the only regional shopping center in southeast Missouri. The Center, which
opened in 1981, was redeveloped in 1984. The one-level Center has 502,856 square
feet of Total GLA on a 65-acre site, with 82 Mall Stores and three Anchors:
Famous-Barr, J.C. Penney and Venture. The Company believes that there is
redevelopment potential for another anchor. The Company owns 100% of the Center.
Mall Store sales per square foot (based on Mall Store tenants reporting sales)
were $189, $206 and $212 for 1994, 1995 and 1996, respectively.

DENVER POWER CENTER

WESTLAND TOWNE CENTER. Westland Towne Center is located to the west of
downtown Denver in suburban Lakewood, Colorado. The Center, which opened in
1960, was redeveloped into a power center in 1994. The Center has 470,943 square
feet of Total GLA on a 46-acre site, with 15 Mall Stores and is anchored by a
Super Kmart (approximately 191,000 square feet) and a Sears store. The 1994
redevelopment repositioned the Center to better serve the middle income west
Denver market. No further redevelopment is currently planned. The Company owns
100% of the Center. Mall Store sales per square foot (based on Mall Store
tenants reporting sales) were $148 and $175 for 1995 and 1996, respectively.
Mall Store sales per square foot are not provided for 1994 as the Center was
under redevelopment in 1994.

THE WEST COAST PROPERTIES

The West Coast portfolio consists of interests in nine Centers in California
and one in Vancouver, Washington. With a population of more than 15.6 million,
the Los Angeles properties serve a broad customer base. The San Diego properties
serve a growing market with a base of 2.7 million people. The California
properties are well located with good access to major highways and are well
positioned to take advantage of the economic recovery taking place in
California. Vancouver Mall is in the Portland/ Vancouver market which has a
population of 1.7 million.

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<PAGE>
CALIFORNIA SUPER REGIONAL CENTERS

MISSION VALLEY CENTER. Mission Valley Center is located in Mission Valley
in the heart of San Diego County, and is easily accessible from Interstates 8,
805 and 5. The one-level, open-air Center, which opened in 1961, was redeveloped
and strategically repositioned in 1996-7. A new 20-screen AMC theater which
opened in 1995 drew over 2 million theater-goers in its first year, making it
one of the top five movie theaters in the United States. As part of the
redevelopment, a major mall concourse was redeveloped with Category Killers,
including Bed Bath & Beyond, Loehmann's, Michaels and Nordstrom Rack. Theme
restaurants including Jr. Seau's, Canyon Cafe and Wolfgang Puck's Cafe have been
added to the Center. The repositioning of the Center allows it to better serve
its large middle class market. The Center has over 1.3 million square feet of
Total GLA on a 58-acre site, with 95 Mall Stores and three Anchors: Robinsons-
May, Montgomery Ward and Macy's. Mall Store sales per square foot (based on Mall
Store tenants reporting sales and computed on an aggregate basis for Mission
Valley Center and Mission Valley Center-West) were $239, $246 and $283 for 1994,
1995 and 1996, respectively.

The Company owns 75.8% of the Mission Valley partnership and is the sole
general partner. Under the terms of the partnership agreement, which terminates
on October 8, 2007, a partner may not transfer its interest, other than to an
affiliate, without the consent of the other partners.

NORTH COUNTY FAIR. North County Fair is located in Escondido, California,
and serves the north San Diego County market along Interstate 15. The
three-level Center, which opened in 1986, has over 1.2 million square feet of
Total GLA on a 83-acre site, with 168 Mall Stores and six Anchors: Nordstrom,
two Robinsons-May, Macy's, J.C. Penney and Sears. The Center has a significant
position in the upper middle class trade area. The Center is leased from the
city of Escondido under a 50-year lease which expires in 2033. North County Fair
is the only Center not managed by Westfield Holdings. Mall Store sales per
square foot (based on Mall Store tenants reporting sales) were $302, $297 and
$316 for 1994, 1995 and 1996, respectively.

The Company is a 45% limited partner in North County Fair. Under the terms
of the partnership agreement terminating on June 30, 2033, a partner may not
transfer its interest except to (i) an affiliate, (ii) a third party, subject to
a right of first refusal or (iii) a successor by merger or purchase of all or
substantially all of the assets.

PLAZA BONITA. Plaza Bonita is located in the south bay area of San Diego
County along Interstate 805, eight miles from the Mexican border. This two-level
Center, which opened in 1981, has 822,075 square feet of Total GLA on a 70-acre
site, with 135 Mall Stores and four Anchors: Robinsons-May, J.C. Penney,
Montgomery Ward and Mervyn's. Further redevelopment on a fifth pad may include
an additional anchor or specialty shops. The Company owns 100% of the Center.
Mall Store sales per square foot (based on Mall Store tenants reporting sales)
were $287, $269 and $304 for 1994, 1995 and 1996, respectively.

PLAZA CAMINO REAL. Plaza Camino Real is located in northern San Diego
County near the intersection of Highway 78 and El Camino Real and serves the
tri-city area of Carlsbad, Vista and Oceanside. This Center, which opened in
1969, was last redeveloped in 1989. The two-level Center has over 1.1 million
square feet of Total GLA on a 82-acre site, with 155 Mall Stores and five
Anchors: two Macy's, Robinsons-May, J.C. Penney and Sears. The Company believes
the Center has redevelopment potential with the inclusion of theaters,
restaurants or, possibly, Category Killers. Mall Store sales per square foot
(based on Mall Store tenants reporting sales) were $222, $245 and $275 for 1994,
1995 and 1996, respectively.

The Company is the 40% general partner in Plaza Camino Real. Under the terms
of the partnership agreement terminating in 2065, the consent of a majority
interest of limited partners is generally required for any transfer by the
Company of its interest in the Center other than to certain affiliated entities.

THE PLAZA AT WEST COVINA. The Plaza at West Covina is located in West
Covina, California, Los Angeles County on Interstate 10 (the San Bernardino
Freeway). The Center is the leading super regional shopping center serving the
San Gabriel Valley. The Center, which opened in 1975, was renovated in 1990. In
1993, a Robinsons-May store and 100,000 square feet of Mall GLA was added to the
Center. In 1996,

74
<PAGE>
the former Broadway store converted into a new Sears, the Bullock's converted
into Macy's and the Company added a 50,000 square-foot Oshman's Super Store. The
Center has over 1.2 million square feet of Total GLA on a 71-acre site, with 194
Mall Stores and four Anchors: Robinsons-May, Macy's, Sears and J.C. Penney. The
Company owns 100% of the Center. Mall Store sales per square foot (based on Mall
Store tenants reporting sales) were $218, $220 and $256 for 1994, 1995 and 1996,
respectively.

TOPANGA PLAZA. Topanga Plaza is located in Warner Center in the West San
Fernando Valley, in Los Angeles, California. The Center, which opened in 1964,
was renovated and repositioned in 1994 with an upscale merchandise mix including
Crate & Barrel, Guess, The Museum Company, and Warner Bros. A Sears opened in
late 1996, replacing a Broadway store. The Center has the only Nordstrom in the
west San Fernando Valley and attracts a high-income customer base. The two-level
Center has approximately 1.1 million square feet of Total GLA on a 63-acre site,
with 130 Mall Stores and four Anchors: Nordstrom, Robinsons-May, Sears and
Montgomery Ward. The Company believes the Center has redevelopment potential
with up to two additional department stores and additional Mall GLA. Mall Store
sales per square foot (based on Mall Store tenants reporting sales) were $340,
$338 and $332 for 1994, 1995 and 1996, respectively.

The Company is a 42% general partner in Topanga Plaza; the Outside Partner
is a 58% general partner. Under the terms of the partnership agreement, which
expires December 31, 2035, until December 31, 1998, the Company's joint venture
partner has the sole right to cause the Center to be sold, subject to a right of
first refusal by the Company; after January 1, 1999, either partner may cause
the Center to be sold subject to a right of first refusal by the other. The
Company may transfer its interest in the Center to certain affiliates without
the consent of the Outside Partner.

CALIFORNIA REGIONAL CENTER

EAGLE ROCK PLAZA. Eagle Rock Plaza is located southeast of Glendale,
California in Los Angeles County at Colorado Boulevard and the Glendale Freeway.
The two-level Center, which opened in 1973, has 474,230 square feet of Total GLA
on a 22-acre site, with 63 Mall Stores and two Anchors: Robinsons-May and
Montgomery Ward. Future redevelopment and repositioning may include an
additional anchor and a Category Killer. The Company owns 100% of the Center.
Mall Store sales per square foot (based on Mall Store tenants reporting sales)
were $166, $186 and $177 for 1994, 1995 and 1996, respectively.

CALIFORNIA POWER CENTERS

EASTLAND CENTER. Eastland Center is located on Interstate 10 in Los Angeles
County. Redevelopment of the Center, which opened in 1957, is substantially
complete. The Center has been repositioned as a power center and offers
value-oriented shopping with Ross Dress for Less, Office Depot, Old Navy,
Marshall's and a Babies 'R Us. The Center has 819,244 square feet of Total GLA
on a 58-acre site with 29 Mall Stores and is anchored by Mervyn's and a new
Target. The Center also has a major grocery store and drugstore. The Company
owns 100% of the Center. There were no reported sales by Mall Store tenants for
1994-1996 as the Center was under redevelopment.

MISSION VALLEY CENTER-WEST. The Center is a strip center, located on and
visible from Interstate 8, adjacent to the super regional Mission Valley Center.
The Center, which opened in 1961, has 178,624 square feet of Total GLA, 34 Mall
Stores and several value tenants, offices and outparcels. The Company plans to
build a new power center with value-oriented retailers complementing the newly,
repositioned Mission Valley Center and strengthening the retail hub created by
the two Centers. Mall Store sales per square foot (based on Mall Store tenants
reporting sales and computed on an aggregate basis for Mission Valley Center and
Mission Valley Center-West) were $239, $246 and $283 for 1994, 1995 and 1996,
respectively.

Mission Valley Center-West is owned by the same partnership that owns
Mission Valley Center.

75
<PAGE>
WEST VALLEY

West Valley is located in Canoga Park, California, and is adjacent to
Topanga Plaza. The property is predominantly vacant land with a few outparcels
that have been developed. The Company plans to redevelop the property into a
power center with value-oriented retailers. The property has 36.6 acres with
excellent visibility and position in Warner Center.

The Company is a 42.5% general and limited partner in West Valley under the
terms of the partnership agreement which terminates on December 31, 2015; the
Outside Partners have a 57.5% limited partnership interest.

WASHINGTON SUPER REGIONAL CENTERS

VANCOUVER MALL. Vancouver Mall, is located in Vancouver, Washington in
Clark County, a growing suburb of the Portland, Oregon metropolitan area. The
Center, which opened in 1977, was recently renovated and redeveloped by adding a
food court in 1993. The two-level Center has 870,141 square feet of Total GLA on
a 97-acre site, with 156 Mall Stores and five Anchors: Meier & Frank, Nordstrom,
Sears, J.C. Penney and Mervyn's. Expansion of current department stores is
planned to solidify the Center's position within its market. Mall Store sales
per square foot (based on Mall Store tenants reporting sales) were $196, $218
and $243 for 1994, 1995 and 1996, respectively.

The Company is a 50% general partner in Vancouver Mall; the Outside Partner
is also a 50% general partner. Under the terms of the partnership agreement,
terminating September 28, 2074, the Company's joint venture partner may only
sell its interest (other than through a right of first refusal) to a corporate
affiliate or in connection with a merger, consolidation or reorganization.
Notwithstanding any other provision, the partners together may not sell more
than 50% of the partnership interest in a year. There are buy-sell provisions
regarding the property, the price being set by the offeror. The Company's joint
venture partner may buy out the Company in certain circumstances (such as
bankruptcy) at the fair market value, which is determined by appraisal
procedures. Neither partner may mortgage its partnership interest.

ANCHORS

Anchors generally are department stores whose merchandise appeals to a broad
range of shoppers and traditionally have been a major factor in the public's
perception of a shopping center. Although the Centers receive a smaller
percentage of their operating income from Anchors than from Mall Stores, the
Company believes that the Anchors at a Center help to generate customer traffic
and therefore make a Center a desirable location for Mall Store tenants.

Anchors and the owner of a shopping center usually enter into agreements,
generally referred to as "reciprocal easement agreements" or "REAs," covering,
among other things, operational matters, initial construction and future
expansion. Anchors generally retain certain rights to approve or disapprove
future renovations or expansions of the shopping center, and the REAs usually
are recorded as encumbrances on all of the real property within the shopping
center. Many of the Anchors own their stores, the land under them and adjacent
parking areas. Others enter into long-term leases at rents that are lower than
the rents generally charged to Mall Store tenants.

Anchors at the Centers occupy approximately 11.5 million square feet of
Total GLA, or 59.9% of Total GLA, and accounted for less than 8.2% of the
Company's total revenue in 1996 (including North County Fair, 7.6% of the
Company's total revenues in 1996). Anchors range in size from approximately
72,000 to 363,000 square feet, with an average of approximately 156,000 square
feet. The Centers have 74 Anchors operating under 18 trade names. Excellent
relationships have been established with major Anchors, including
Dayton-Hudson's, Dillard's, Federated, J.C. Penney, May Company, Montgomery
Ward, Nordstrom and Sears. These relationships, combined with Westfield
Holdings's experience in management and development, enhance the Company's
development activities by permitting substantial pre-leasing of new projects,
lease-up of existing space and releasing opportunities.

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<PAGE>
The following table indicates the parent company of each Anchor, the number
of stores owned or leased by each Anchor in the Centers, Total GLA and the
percentage of Total GLA as of December 31, 1996.

<TABLE>
<CAPTION>
1996
TOTAL GLA TOTAL ANNUALIZED
NUMBER OF (SQUARE FEET) PERCENTAGE OF BASE RENT
NAME ANCHOR STORES (IN THOUSANDS) TOTAL GLA (IN THOUSANDS)
- ----------------------------------------------- --------------------- --------------- --------------- -----------------
<S> <C> <C> <C> <C>
May Department Stores
Robinsons-May................................ 8 1,520 7.9% $ 113
Famous-Barr.................................. 4 693 3.6 264
Filene's..................................... 4 705 3.7 479
Hecht's...................................... 2 416 2.2 --
Meier & Frank................................ 1 118 0.6 --
Lord & Taylor................................ 1 118 0.6 --
--
------ --- ------
Sub-Total...................................... 20 3,570 18.6 856
--
------ --- ------
J.C. Penney.................................. 16 2,415 12.6 1,653
Sears........................................ 11 1,657 8.6 60
Macy's....................................... 7 1,269 6.6 1,546
Montgomery Ward.............................. 5 790 4.1 207
Nordstrom.................................... 5 730 3.8 777
Dayton Hudson
Mervyn's................................... 3 248 1.3 --
Target Discount............................ 1 122 0.6 63
--
------ --- ------
Sub-Total.................................... 4 370 1.9 63
--
------ --- ------
Dillard's.................................... 2 290 1.5 15
Caldor....................................... 1 86 0.4 210
Venture...................................... 1 81 0.4 --
AMC Theater.................................. 1 76 0.4 761
Kmart........................................ 1 191 1.0 1,517
--
------ --- ------
Total........................................ 74 11,525 59.9% $ 7,665
--
--
------ --- ------
------ --- ------
</TABLE>

No single Anchor accounted for more than 10% of Total GLA as of December 31,
1996 at the Centers, except for the May Company which accounted for 18.6% of
Total GLA and J.C. Penney which accounted for 12.6% of Total GLA.

MALL STORES

The Centers have approximately 2,500 Mall Stores. As of December 31, 1996,
national or regional chains leased approximately 90% of the Mall GLA. The five
Mall Stores retailers accounting for the largest percentage of Mall Store
effective rent in 1996 were: The Limited Stores (Abercrombie & Fitch, The
Limited, Limited Express, Lane Bryant, Lerner's, Structure, Victoria Secret),
The Woolworth Corporation (Footlocker, Kinney Shoes and others), The Gap (The
Gap, Gap Kids, Banana Republic), Barnes and Noble, and Casual Corner.

In 1996, the Centers under Westfield Holdings's management (excluding
Eastland Center which is under redevelopment) reported average Mall Store sales
psf of $297 (including North County Fair, sales psf of $300) as compared to an
industry average of $278 psf for the same period (Source: ICSC Monthly Mall
Merchandiser Index, February 1997).

In 1996, the Centers derived approximately 95% of their base rents from Mall
Stores, which occupied approximately 40.1% of the Total GLA. No Mall Store
retailer accounted for more than 5% of Mall GLA or more than 6% of the Company's
1996 annualized effective rent (I.E., base plus percentage) at the

77
<PAGE>
Centers, except for The Limited Stores, a clothing retailer, which occupied 10%
of Mall GLA, and accounted for 11% of the 1996 total Mall Store annualized
effective rent as of December 31, 1996.

The following table sets forth, as of December 31, 1996, certain information
with respect to the ten largest Mall Store tenants (through their various
operating divisions) in terms of Mall GLA.

<TABLE>
<CAPTION>
TOTAL 1996
NUMBER OF MALL GLA EFFECTIVE PERCENTAGE OF
MALL STORES (SQUARE PERCENTAGE OF RENT TOTAL MALL STORE
TENANT LEASED FEET) MALL GLA (THOUSANDS) EFFECTIVE RENT
- ---------------------- --------------- ------------ ----------------- ------------- ---------------------
<S> <C> <C> <C> <C> <C>
Limited Stores........ 102 771,119 10% $ 15,941 11%
Woolworth............. 119 384,211 5 8,325 6
The Gap............... 17 131,030 2 3,054 2
Casual Corner......... 28 104,230 1 2,369 2
Barnes and Noble...... 27 84,545 1 2,492 2
Edison Brothers....... 38 77,163 1 1,845 1
Trans World........... 12 75,859 1 1,793 1
Eddie Bauer........... 12 73,530 1 2,173 1
Musicland............. 18 71,887 1 2,129 1
Kay Bee Toys &
Hobby................ 18 69,509 1 1,711 1
-- --
--- ------------ -------------
Total................. 391 1,843,083 24% $ 41,832 28%
-- --
-- --
--- ------------ -------------
--- ------------ -------------
</TABLE>

SALES

"Total sales" accounts for a portfolio's ability to generate sales over its
total square footage and is affected by occupancy. Total sales for Mall Stores
(including North County Fair) was in excess of $1.5 billion in 1996 and
represented a compound annual growth rate of 6.7% between 1994 (when Westfield
Holdings began managing the Company) and 1996.

The table below sets forth Mall Store sales for Centers in the East Coast,
the Mid West and the West Coast regions of the United States.

<TABLE>
<CAPTION>
EAST COAST CENTERS MID WEST CENTERS WEST COAST CENTERS TOTAL CENTERS
------------------------------ ---------------------------- -------------------------- --------------------------
PERCENTAGE PERCENTAGE PERCENTAGE PERCENTAGE
SALES(1) INCREASE SALES(1) INCREASE SALES(1) INCREASE SALES(1) INCREASE
YEAR (MILLIONS) (DECREASE) (MILLIONS) (DECREASE) (MILLIONS) (DECREASE) (MILLIONS) (DECREASE)
- ---------- ----------- ----------------- ----------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1994...... $ 667 -- $ 168 -- $ 652 -- $ 1,487 --
1995...... 699 4.8% 174 3.6% 660 1.2% 1,533 3.1%
1996...... 700 -- 177 1.7 714 8.2 1,591 3.8
</TABLE>

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

(1) Sales are based on reports of Mall Store tenants reporting sales and
excludes Centers under redevelopment.

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<PAGE>
LEASING

Leased percentages are calculated on the basis of signed leases under which
the Company at the time of determination will be receiving rents for a period of
12 consecutive months starting on the date of calculation. The following table
sets forth leased status for the Centers in the East Coast, the Mid West and the
West Coast regions of the United States (excluding Centers under redevelopment).

<TABLE>
<CAPTION>
WEST COAST WEST COAST TOTAL TOTAL
CENTERS CENTERS CENTERS CENTERS
EAST COAST MID WEST (INCLUDING NORTH (EXCLUDING NORTH (INCLUDING NORTH (EXCLUDING NORTH
DECEMBER 31 CENTERS CENTERS COUNTY FAIR) COUNTY FAIR) COUNTY FAIR) COUNTY FAIR)
- ------------------- ------------- ----------- ----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
1992............... 91% 88% 91% 90% 90% 90%
1993............... 93 89 90 90 91 91
1994............... 94 88 84 83 88 88
1995............... 92 92 88 89 90 90
1996............... 92 93 90 92 91 92
</TABLE>

Since Westfield Holdings acquired an interest in the Company and began to
provide development services with respect to the Centers, Eastland Center, West
Covina, California; Enfield Square, Enfield, Connecticut; Mid Rivers Mall, St.
Peters, Missouri; and Mission Valley Center, San Diego, California, have
undergone redevelopment, expansion and/or repositioning. It is the Company's
policy to minimize, to the extent consistent with the redevelopment plan, the
impact on existing tenants and revenues. In the case of Eastland Center and
Mission Valley Center, the areas targeted for redevelopment were substantially
vacant at the time the properties were acquired by the Company, and existing
tenants and revenues were not materially affected during redevelopment. The
projects at Enfield Square and Mid Rivers Mall involved expansion and did not
materially affect the existing tenants or revenues. The current redevelopment at
South Shore Mall is not expected to have a material affect during redevelopment.

COSTS OF OCCUPANCY

Management believes that in order to continue to increase Funds from
Operations, Mall Store tenants must be able to operate profitably. A major
factor contributing to tenant profitability is cost of occupancy. Management
believes that the occupancy costs for Mall Stores in the Centers are competitive
within the respective markets serviced by the Centers, thereby giving the
Company an opportunity to increase minimum rents.

The following table sets forth certain information relating to occupancy
costs in the Centers (including all Mall Store tenants reporting sales).

<TABLE>
<CAPTION>
(INCLUDING NORTH (EXCLUDING NORTH
COUNTY FAIR) COUNTY FAIR)
FOR THE YEARS ENDED FOR THE YEARS ENDED
DECEMBER 31, DECEMBER 31,
-------------------- --------------------
1996 1995 1996 1995
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Occupancy Costs as a Percentage of Sales:
Base Rents.............................................. 8.6% 8.9% 8.5% 8.7%
Expense Recoveries...................................... 4.6 4.8 4.7 4.9
--- --- --- ---
Total................................................. 13.2% 13.7% 13.2% 13.6%
--- --- --- ---
--- --- --- ---
</TABLE>

LEASES

Generally the Mall Store leases are for ten-year terms at inception and the
leases provide for tenants to pay rent comprised of two elements. The first
element is fixed "base" or "minimum" rent, often subject to step increases
according to a schedule agreed upon at the time of lease inception. The second
element of rent is additional rent based upon a percentage of a tenant's gross
sales in excess of a minimum annual amount. Although both elements are
immaterial in the aggregate, in some cases, tenants only pay a fixed base rent
and, in a few cases, tenants only pay percentage rent.

79
<PAGE>
Virtually all of the leases for Mall Stores contain provisions that allow
the Centers to recover certain operating costs and expenses (including certain
capital expenditures) with respect to the common areas (including parking
facilities), all buildings, roofs and facilities within the Centers, as well as
insurance and property taxes. As a result of the foregoing, the Centers
recovered approximately 102% (including North County Fair) of these costs and
expenditures in 1996.

LEASE EXPIRATIONS

The expiration of leases presents shopping center owners with the
opportunity to increase base and percentage rents, modify lease terms and
conditions, improve tenant mix, relocate existing tenants, reconfigure or expand
tenant spaces and introduce new retailers and retail concepts to the shopping
center. The Company endeavors to increase base rent levels in the Centers in
part through negotiating terminations of leases of under performing tenants and
renegotiating existing leases. Where indicated, the Company has excluded
outparcels from various calculations set forth below. Outparcels include one or
more free standing buildings generally located along the perimeter of a Center.
The outparcels have been excluded because they are typically ground leased to
the tenants who own their own buildings and because such buildings are typically
restaurants, banks and similar service facilities.

The following table shows scheduled lease expirations as of December 31,
1996 for the next ten years for the Centers' Mall Stores (excluding outparcels).

<TABLE>
<CAPTION>
APPROXIMATE
MALL GLA OF PERCENTAGE AVERAGE ANNUALIZED PERCENTAGE OF
EXPIRING OF MALL GLA BASE RENT BASE RENT BASE RENT
NUMBER LEASES REPRESENTED (PSF) OF OF EXPIRING REPRESENTED
OF LEASES (SQUARE BY EXPIRING EXPIRING LEASES BY EXPIRING
YEAR ENDING DECEMBER 31, EXPIRING FEET) LEASES LEASES (THOUSANDS) LEASES
- ------------------------- ------------- ------------ ------------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
1997..................... 84 177,853 3.48% $ 25.27 $ 4,494 3.27%
1998..................... 217 460,672 9.01 25.35 11,676 8.49
1999..................... 186 321,180 6.28 25.98 8,344 6.07
2000..................... 194 334,433 6.54 29.55 9,881 7.18
2001..................... 190 378,982 7.41 30.80 11,673 8.49
2002..................... 215 482,845 9.45 30.59 14,771 10.74
2003..................... 198 467,827 9.33 26.93 12,843 9.34
2004..................... 234 681,311 13.33 27.24 18,561 13.49
2005..................... 192 582,274 11.39 26.82 15,619 11.36
2006..................... 164 465,071 9.1 28.35 13,184 9.59
</TABLE>

MALL STORE RENTAL RATES

The following table contains certain information regarding per square foot
average base rent of the Mall Stores that have been open since January 1, 1994
(excluding outparcels and North County Fair).

<TABLE>
<CAPTION>
ALL ALL
EXISTING LEASES EXISTING LEASES
(EXCLUDING (INCLUDING
NORTH COUNTY NORTH COUNTY
AS OF DECEMBER 31 FAIR) FAIR)
- ------------------------------------------------------------------- --------------- ---------------
<S> <C> <C>
1992............................................................... $ 20.32 $ 20.76
1993............................................................... 21.51 21.88
1994............................................................... 24.62 24.86
1995............................................................... 25.89 26.07
1996............................................................... 26.88 26.99
</TABLE>

As leases have expired, the Company has generally sought to rent the
available space, either to the existing tenant or a new tenant, at rental rates
that are higher than those of the expired leases, in part since the average rent
for leases in place is generally less than the market rate for such space.

The average effective (base plus percentage) annual rent per square foot at
Mall Stores was $27.62 psf at December 31, 1996 (excluding outparcels and North
County Fair) (excluding outparcels and including North County Fair, $27.50 psf
at December 31, 1996).

80
<PAGE>
The following table illustrates increases in Mall Store rental rates
(excluding outparcels).

<TABLE>
<CAPTION>
LEASES LEASES LEASES LEASES
EXPIRING EXECUTED EXPIRING EXECUTED
DURING THE DURING THE DURING THE DURING THE
PERIOD(1) PERIOD(2) PERIOD(1) PERIOD(2)
(EXCLUDING (EXCLUDING (INCLUDING (INCLUDING
NORTH NORTH NORTH NORTH
YEAR COUNTY FAIR) COUNTY FAIR) COUNTY FAIR) COUNTY FAIR)
- ------------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
1994............... $ 20.63 $ 28.63 $ 21.26 $ 28.88
1995............... 22.89 26.06 23.03 26.68
1996............... 21.48 28.16 22.88 28.62
</TABLE>

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

(1) Includes scheduled expirations, early termination, abandonments and
negotiated buyouts. Represents average base rent for the final year of
occupancy.

(2) Includes renewals. Represents average base rent for the initial year of
occupancy.

Minimum rents at Mall Stores are expected to grow based upon contractual
increases in base rent in existing leases, although there can be no assurance
that such contractual increases will be realized or that such contractual
increases are indicative of possible future increases in base rent. In the
aggregate, base rent is expected to increase by approximately $16,456,089 over
the next five years through these contractual increases (excluding outparcels).

<TABLE>
<CAPTION>
EXISTING CUMULATIVE EXISTING
CONTRACTUAL RENT CONTRACTUAL RENT
YEAR INCREASES INCREASES
- -------------------------------------------------------- ------------------- -------------------------
<S> <C> <C>
1997.................................................... $ 4,650,210 $ 4,650,210
1998.................................................... 4,889,631 9,539,841
1999.................................................... 2,775,982 12,315,823
2000.................................................... 2,223,276 14,539,099
2001.................................................... 1,916,990 16,456,089
</TABLE>

As required by GAAP, contractual rent increases are recognized as rental
income using the straight line method over the respective lease term which may
result in the recognition of income not evidenced by cash receipts. The amount
of contractual rent increases not represented by cash receipts for the year
ended December 31, 1996 was $2.3 million.

In addition to the increase in existing leases, the Company endeavors to
increase base rent levels in the Centers in part through negotiating
terminations of leases of under performing tenants and renegotiating existing
leases.

COMPETITION

All of the Centers are located in developed retail and commercial areas.
With respect to certain of such Centers, other malls or neighborhood and
community shopping centers may compete within the Primary Trade Area of each of
the Centers. The amount of rentable space in the relevant Primary Trade Area,
the quality of facilities and the nature of stores at such competing shopping
centers could each have a material adverse effect on the Company's ability to
lease space and on the level of rents the Company can obtain. In addition,
retailers at the Centers face increasing competition from other forms of
retailing, such as discount shopping centers, outlet malls, catalogues, discount
shopping clubs and telemarketing. Other development companies, including other
REITs, compete for acquisition of new retail shopping centers. See "Business and
Properties--The Shopping Center Business."

Although the Company believes the Centers can compete effectively within
their trade areas, the Company must also compete with other owners, managers and
developers of retail shopping centers and malls. Those competitors that are not
REITs may be at an advantage to the extent they can utilize working capital to
finance projects, while the Company (and its competitors that are REITs) will be
required by the annual distribution provisions under the Code to distribute
significant amounts of cash from operations to its shareholders. In addition,
the Company intends to distribute more cash to its shareholders than is required
by the Code because of WAT's distribution policies. See "Distributions." If the
Company should

81
<PAGE>
require funds, it may have to borrow when the cost of capital is high. Moreover,
increased competition could adversely affect the Company's revenues and Funds
from Operations.

CERTAIN TAX INFORMATION

The aggregate real estate property tax obligations for the Centers during
calendar 1996 was approximately $21.1 million. Substantially all leases for Mall
Stores contain provisions requiring tenants to pay as additional rent their
proportionate share of any real estate taxes.

At December 31, 1996, the Properties' gross Federal income tax basis was
approximately $1,182.9 million. The Company computes depreciation on the Centers
for Federal income tax purposes generally using the straight line method based
on useful lives ranging from 3 to 40 years and for accounting purposes using the
straight-line method based on useful lives of 3 to 50 years for buildings and
improvements and 10 years for equipment and fixtures.

ADDITIONAL INFORMATION REGARDING CONNECTICUT POST MALL, MONTGOMERY MALL, THE
PLAZA AT WEST COVINA, SOUTH SHORE MALL AND TRUMBULL SHOPPING PARK

The following section provides certain additional information with respect
to Montgomery Mall, The Plaza at West Covina, Connecticut Post Mall, South Shore
Mall and Trumbull Shopping Park. Montgomery Mall and The Plaza at West Covina
are the only Centers which had gross revenues which amounted to 10% or more of
the aggregate gross revenues of the Company during 1996. In addition, Montgomery
Mall also had a book value which amounted to 10% or more of the total assets of
the Company in 1996. Each of Connecticut Post Mall, South Shore Mall and
Trumbull Shopping Park, which were acquired by the Company in July, 1996 and for
which the Company's book value is based on the acquisition cost, had a book
value which amounted to 10% or more of the total assets of the Company in 1996.
Each of Montgomery Mall, The Plaza at West Covina, Connecticut Post Mall, South
Shore Mall and Trumbull Shopping Park is 100% owned by the Company.

The following table sets forth the Total GLA, number of Mall Stores, Anchors
and date of last redevelopment relating to Montgomery Mall, The Plaza at West
Covina, Connecticut Post Mall, South Shore Mall and Trumbull Shopping Park.

<TABLE>
<CAPTION>
NUMBER OF MALL DATE OF LAST
CENTER TOTAL GLA STORES ANCHORS REDEVELOPMENT
- ------------------------------------------------- ---------- --------------- ---------------- ------------------
<S> <C> <C> <C> <C>
Connecticut Post Mall ........................... 831,707 133 Filene's 1991
Milford, Connecticut J.C. Penney
Caldor
Montgomery Mall ................................. 1,253,482 178 Nordstrom 1991
Bethesda, Maryland Hecht's
J.C. Penney
Sears
The Plaza at West Covina 1,233,582 184 Robinson's- May 1993
West Covina, California......................... Macy's
Sears
J.C. Penney
South Shore Mall ................................ 1,108,111 129 Macy's Currently under
Bayshore, New York J.C. Penney redevelopment
Sears
Trumbull Shopping Park ......................... 1,160,716 175 Macy's 1992
Trumbull, Connecticut Filene's
J.C. Penney
Lord & Taylor
</TABLE>

The Company is currently redeveloping South Shore Mall, including the
addition of a Sears store and 40,000 square feet of Total GLA. Total project
cost are estimated at $30.4 million and are expected to be funded through the
Company's unsecured line of credit. Project completion is scheduled for Fall
1997. The Company is planning for the addition of up to two Anchors and
specialty stores at Connecticut Post Mall over the next five years. The Company
believes that there is further redevelopment potential for

82
<PAGE>
Montgomery Mall, The Plaza at West Covina, and Trumbull Shopping Park during the
next five to ten years although such redevelopment is not currently planned.

The following chart sets forth the Mall Store sales per square foot for
Connecticut Post Mall, Montgomery Mall, The Plaza at West Covina, South Shore
Mall and Trumbull Shopping Park. Sales are based on Mall Stores reporting sales:

<TABLE>
<CAPTION>
CENTER 1996 1995 1994
- ------------------------------------------------------------------------------------------ --------- --------- ---------
<S> <C> <C> <C>
Connecticut Post Mall..................................................................... $ 298 $ 297 $ 297
Montgomery Mall........................................................................... 405 397 384
The Plaza at West Covina.................................................................. 256 220 218
South Shore Mall.......................................................................... 292 282 265
Trumbull Shopping Park.................................................................... 314 307 271
</TABLE>

No tenant leased 10% or more of the rentable square footage at The Plaza at
West Covina. The following table sets forth the principal provisions of leases
for tenants that leased 10% or more of the rentable square footage of
Connecticut Post Mall, Montgomery Mall, South Shore Mall and Trumbull Shopping
Park as of December 31, 1996:

<TABLE>
<CAPTION>
BASE RENTAL SQUARE LEASE
PER ANNUM FOOTAGE EXPIRATION OPTIONS PERCENTAGE RENT(7)
----------- ----------- ----------- ---------- ----------------------------------
<S> <C> <C> <C> <C> <C> <C>
CONNECTICUT POST MALL
J.C. Penney.............. $ 832,500 156,848 8/31/17 (1) 1% of sales over
$37,500,000
Caldor................... 209,675 86,454 1/31/03 (2) 1% of sales over
$10,000,000
----------- ----------- 2% of sales over
$12,000,000
Total Anchors............ 1,042,175 243,302
----------- -----------
Limited
Abercrombie & Fitch...... 154,000 7,700 1/31/06 None 5% of sales over
$3,080,000
Express.................. 450,000 18,000 8/31/04 None 5% of sales over
$9,000,000
Lane Bryant.............. 75,296 4,706 1/31/97 None 5% of sales over
$1,505,920
Lerner New York.......... 260,000 13,000 7/31/02 None 5% of sales over
$5,200,000
The Limited.............. 416,025 16,641 7/31/04 None 4% of sales over
$10,400,625
Victoria Secret.......... 213,875 8,555 1/31/02 None 5% of sales over
$4,277,500
----------- -----------
Total Limited.......... 1,569,196 68,602
----------- -----------
Total Connecticut Post $2,611,371 311,904
Mall...................
----------- -----------
----------- -----------
MONTGOMERY MALL
Limited
Abercrombie & Fitch...... $ 347,270 12,628 1/31/07 None 5% of sales over
$8,681,751
Express.................. 307,896 11,978 1/31/00 None 5% of sales over
$6,157,920
Lane Bryant.............. 117,220 5,861 1/31/98 None 5% of sales over
$2,344,402
Lerner New York.......... 133,364 6,062 1/31/99 None 5% of sales over
$2,667,281
The Limited.............. 829,715 29,116 1/31/07 None 4% of sales over
$13,830,100
Victoria Secret.......... 109,893 5,233 1/31/99 None 5% of sales over
$2,197,860
----------- -----------
Total Montgomery Mall.. $1,845,358 70,878
----------- -----------
----------- -----------
SOUTH SHORE MALL
Macy's................... $1,310,286 318,804 1/31/12 (3) 3% of sales up to
$100,000,000
2% of sales over
$100,000,000
but less than
$150,000,000
1% of sales over
$150,000,000
J.C. Penney.............. 155,263 202,116 4/30/02 (4) 2% of sales over
$12,542,890
----------- -----------
Total South Shore...... $1,465,549 520,920
----------- -----------
----------- -----------
TRUMBULL SHOPPING PARK
Macy's................... $ 236,500 215,000 1/31/15 (5) 2% of sales over
$12,900,000 and
2.5% of sales up to
$12,900,000
Filene's................. 479,391 213,081 1/31/04 (6) 0.75% of sales over
$23,250,000
----------- -----------
1% of sales over
$17,250,000
2% of sales over
$10,250,000
Total Trumbull Shopping
Park................. $ 715,891 428,081
----------- -----------
----------- -----------
</TABLE>

- ------------------------------
(1) One 10 year option and three 5 year options
(2) Five 5 year options
(3) Nine 7 year options
(4) Two 5 year options
(5) One 20 year option
(6) Five options, 1st is 6 years and 11 months, 2nd is 4 years, 3rd is 10 years,
4th and 5th are 5 years.
(7) Percentage rent is calculated based upon sales in excess of stipulated
minimums which vary from lease to lease.

83
<PAGE>
Mall Stores leased at Connecticut Post Mall, Montgomery Mall, The Plaza at
West Covina, South Shore Mall and Trumbull Shopping Park were as follows:

<TABLE>
<CAPTION>
CENTER 1996 1995 1994 1993 1992
- ----------------------------------------------------------- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
Connecticut Post Mall...................................... 91% 91% 92% 93% 82%
Montgomery Mall............................................ 97 98 99 95 93
The Plaza at West Covina................................... 91 83 80 82 77
South Shore Mall........................................... 92 88 91 93 90
Trumbull Shopping Park..................................... 86 92 96 97 97
</TABLE>

The following table shows scheduled lease expirations as of December 31,
1996 for the next ten years for Mall Stores at Connecticut Post Mall (excluding
outparcels):

<TABLE>
<CAPTION>
APPROXIMATE AVERAGE BASE ANNUALIZED PERCENTAGE OF
MALL GLA OF PERCENTAGE OF RENT (PSF) BASE RENT BASE ANNUALIZED
NUMBER OF EXPIRING LEASED MALL GLA UNDER OF EXPIRING RENT
YEAR ENDING LEASES LEASES REPRESENTED BY EXPIRING LEASES REPRESENTED BY
DECEMBER 31, EXPIRING (SQUARE FEET) EXPIRING LEASES LEASES (THOUSANDS) EXPIRING LEASES
- ------------ --------- ------------- --------------- ------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
1997 5 15,667 5.9% $ 22.90 $ 359 4.5%
1998 11 23,567 8.9 28.02 660 8.3
1999 5 10,734 4.0 27.04 290 3.6
2000 12 17,804 6.7 36.42 648 8.1
2001 14 16,587 6.2 50.56 839 10.5
2002 21 60,882 22.9 26.93 1,640 20.6
2003 12 23,125 8.7 31.10 719 9.0
2004 6 32,939 12.4 30.44 1,003 12.6
2005 4 18,768 7.1 23.01 432 5.4
2006 4 15,435 5.8 25.24 389 4.9
</TABLE>

The following table shows scheduled lease expirations as of December 31,
1996 for the next ten years for Mall Stores at Montgomery Mall (excluding
outparcels):

<TABLE>
<CAPTION>
PERCENTAGE OF
APPROXIMATE PERCENTAGE OF BASE
MALL GLA OF LEASED MALL AVERAGE ANNUALIZED ANNUALIZED
YEAR EXPIRING GLA BASE RENT BASE RENT RENT
ENDING NUMBER OF LEASES REPRESENTED (PSF) UNDER OF EXPIRING REPRESENTED
DECEMBER LEASES (SQUARE BY EXPIRING EXPIRING LEASES BY EXPIRING
31, EXPIRING FEET) LEASES LEASES (THOUSANDS) LEASES
- ---------- --------- ----------- ------------- ----------- ----------- -------------
1997 1 3,720 0.8% $ 30.00 $ 112 0.7%
<S> <C> <C> <C> <C> <C> <C> <C>
1998 13 24,602 5.5 32.96 811 4.9
1999 17 32,254 7.2 32.35 1,043 6.3
2000 11 20,191 4.5 39.71 802 4.7
2001 13 31,671 7.1 40.44 1,281 7.7
2002 38 68,180 15.2 50.34 3,432 20.7
2003 15 31,038 6.9 42.19 1,309 7.9
2004 19 81,671 18.2 33.02 2,696 16.3
2005 12 35,333 7.9 33.10 1,170 7.1
2006 14 26,997 6.0 40.26 1,087 6.6
</TABLE>

84
<PAGE>
The following table shows scheduled lease expirations as of December 31,
1996 for the next ten years for Mall Stores at The Plaza at West Covina
(excluding outparcels):

<TABLE>
<CAPTION>
APPROXIMATE AVERAGE BASE ANNUALIZED PERCENTAGE OF
MALL GLA OF PERCENTAGE OF RENT (PSF) BASE RENT BASE ANNUALIZED
NUMBER OF EXPIRING LEASED MALL GLA UNDER OF EXPIRING RENT
YEAR ENDING LEASES LEASES REPRESENTED BY EXPIRING LEASES REPRESENTED BY
DECEMBER 31, EXPIRING (SQUARE FEET) EXPIRING LEASES LEASES (THOUSANDS) EXPIRING LEASES
- ------------ --------- ------------- --------------- ------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
1997 5 11,299 2.9% $ 11.47 $ 130 1.5%
1998 3 3,028 0.8 28.37 86 1.0
1999 12 20,050 5.1 33.37 669 7.7
2000 20 31,504 8.0 30.64 965 11.2
2001 14 28,011 7.2 25.83 723 8.4
2002 13 24,313 6.2 24.12 587 6.8
2003 4 9,348 2.4 21.18 198 2.3
2004 41 96,594 24.7 25.00 2,415 27.9
2005 19 44,253 11.3 22.38 990 11.5
2006 13 35,854 9.2 19.91 714 8.3
</TABLE>

The following table shows scheduled lease expirations as of December 31,
1996 for the next ten years for Mall Stores at South Shore Mall (excluding
outparcels):

<TABLE>
<CAPTION>
APPROXIMATE AVERAGE BASE ANNUALIZED PERCENTAGE OF
MALL GLA OF PERCENTAGE OF RENT (PSF) BASE RENT BASE ANNUALIZED
NUMBER OF EXPIRING LEASED MALL GLA UNDER OF EXPIRING RENT
YEAR ENDING LEASES LEASES REPRESENTED BY EXPIRING LEASES REPRESENTED BY
DECEMBER 31, EXPIRING (SQUARE FEET) EXPIRING LEASES LEASES (THOUSANDS) EXPIRING LEASES
- ------------ --------- ------------- --------------- ------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
1997 7 6,145 3.4% $ 53.56 $ 329 5.4%
1998 10 17,764 9.7 40.11 712 11.6
1999 3 8,043 4.4 38.68 311 5.1
2000 6 2,754 1.5 83.99 231 3.8
2001 6 19,724 10.8 36.08 712 11.6
2002 5 12,139 6.7 33.51 407 6.6
2003 9 26,877 14.7 33.33 896 14.6
2004 7 30,318 16.6 32.30 979 16.0
2005 6 27,728 15.2 25.26 700 11.4
2006 3 8,852 4.9 30.62 271 4.4
</TABLE>

The following table shows scheduled lease expirations as of December 31,
1996 for the next ten years for Mall Stores at Trumbull Shopping Park (excluding
outparcels):

<TABLE>
<CAPTION>
PERCENTAGE OF
APPROXIMATE PERCENTAGE OF BASE
MALL GLA OF LEASED MALL AVERAGE ANNUALIZED ANNUALIZED
YEAR EXPIRING GLA BASE RENT BASE RENT RENT
ENDING NUMBER OF LEASES REPRESENTED (PSF) UNDER OF EXPIRING REPRESENTED
DECEMBER LEASES (SQUARE BY EXPIRING EXPIRING LEASES BY EXPIRING
31, EXPIRING FEET) LEASES LEASES (THOUSANDS) LEASES
- ---------- --------- ----------- ------------- ----------- ----------- -------------
1997 11 19,374 5.4% $ 34.58 $ 670 5.9%
<S> <C> <C> <C> <C> <C> <C> <C>
1998 13 13,948 3.9 48.48 676 5.9
1999 12 16,109 4.5 25.58 412 3.6
2000 6 18,324 5.1 17.78 326 2.9
2001 12 18,893 5.2 47.19 892 7.8
2002 13 40,274 11.1 29.87 1,203 10.6
2003 14 41,222 11.4 25.10 1,035 9.1
2004 14 74,851 20.7 27.83 2,083 18.3
2005 9 37,548 10.4 30.15 1,132 9.9
2006 8 29,925 8.3 39.43 1,180 10.4
</TABLE>

85
<PAGE>
Minimum rents are expected to grow based upon contractual increases in base
rent in the Company's existing leases, although there can be no assurance that
such contractual increases will be realized or that such contractual increases
are indicative of possible future increases in base rent. In the aggregate, base
rent is expected to increase by approximately $5,528,702 over the next five
years through these contractual rent increases as illustrated below:

<TABLE>
<CAPTION>
EXISTING CONTRACTUAL RENT INCREASES
- ------------------------------------------------------------------------ CUMULATIVE
TRUMBULL EXISTING
CONNECTICUT MONTGOMERY PLAZA AT SOUTH SHOPPING RENT
YEAR POST MALL MALL WEST COVINA SHORE MALL PARK INCREASES
- --------- ----------- ----------- ----------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
1997 $ 372,912 $ 608,608 $ 506,441 $ 267,975 $ 757,582 $ 2,513,518
1998 289,472 317,623 324,373 58,444 233,315 3,736,745
1999 96,262 221,970 146,754 72,863 99,187 4,373,781
2000 81,674 247,964 174,427 72,803 124,047 5,074,696
2001 7,124 145,672 230,592 28,768 41,850 5,528,702
</TABLE>

The average effective (base rent plus percentage rent) annual rent per
square foot is set forth in the table below:

<TABLE>
<CAPTION>
CENTER 1996 1995 1994 1993 1992
- ----------------------------------------------------------- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
Connecticut Post Mall...................................... $ 30 $ 29 $ 30 $ 29 $ 28
Montgomery Mall............................................ 38 36 34 32 31
The Plaza at West Covina................................... 25 24 23 14 17
South Shore Mall........................................... 34 30 30 27 26
Trumbull Shopping Park..................................... 32 31 31 29 26
</TABLE>

86
<PAGE>
The Company was generally able to increase base rent psf for leases expiring
during the past three years as illustrated below:

<TABLE>
<CAPTION>
LEASES LEASES
EXPIRING EXECUTED
EXISTING DURING THE DURING THE
CENTER AND YEAR BASE RENTS PERIOD(1) PERIOD(2)
- ----------------------------------------------------------- ----------- ----------- -----------
<S> <C> <C> <C>
Connecticut Post Mall:
1994..................................................... $ 29.34 $ 23.00 $ 25.64
1995..................................................... 28.96 27.55 27.03
1996..................................................... 29.96 26.03 27.90

Montgomery Mall:
1994..................................................... $ 33.40 $ 34.08 $ 37.31
1995..................................................... 35.50 37.35 60.39
1996..................................................... 36.98 42.26 49.25

The Plaza at West Covina:
1994..................................................... $ 21.55 $ 16.32 $ 24.09
1995..................................................... 23.18 20.28 26.04
1996..................................................... 24.10 17.72 16.30

South Shore Mall:
1994..................................................... $ 28.82 $ 20.29 $ 28.04
1995..................................................... 29.10 24.90 26.34
1996..................................................... 33.61 22.80 23.90

Trumbull Shopping Park:
1994..................................................... $ 30.37 $ 29.37 $ 33.32
1995..................................................... 30.61 26.69 27.92
1996..................................................... 31.48 24.70 36.68
</TABLE>

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

(1) Includes scheduled expirations, early termination, abandonments and
negotiated buyouts. Represents average base rent for the final year of
occupancy.

(2) Includes renewals. Represents average base rent for the initial year of
occupancy.

Connecticut Post Mall, Montgomery Mall, The Plaza at West Covina, South
Shore Mall and Trumbull Shopping Park are the largest shopping centers in their
respective trade areas. South Shore Mall in Bay Shore, New York serves the
southern Long Island market in Suffolk County and has one competing regional
center in its Primary Trade Area. Trumbull Shopping Park, in Trumbull,
Connecticut serves the Fairfield County, Connecticut market and there is no
competitive regional shopping center. Connecticut Post Mall in Milford,
Connecticut is the only super regional shopping center serving the greater New
Haven market. Connecticut Post and Trumbull Shopping Park are eleven miles apart
and a portion of their trade areas overlap. There is a regional center proposed
to be developed in the greater New Haven area that would, if eventually
developed, compete with Connecticut Post. The Plaza at West Covina, in West
Covina, California is one of three super regional centers serving the San
Gabriel Valley market. Three other regional shopping centers complete with
Montgomery Mall's Primary Trade Area. However, Montgomery Mall has the largest
total gross leasable area of any center within this trade area.

87
<PAGE>
Annual real estate taxes for the year ended December 31, 1996 and gross
Federal income tax basis at December 31, 1996 for Connecticut Post Mall,
Montgomery Mall, The Plaza at West Covina, South Shore Mall and Trumbull
Shopping Park were as follows:

<TABLE>
<CAPTION>
CENTER
- ------------------------------------------------------------------- REAL ESTATE FEDERAL
TAXES INCOME TAX
--------------- BASIS
(IN MILLIONS) -------------
(IN MILLIONS)
<S> <C> <C>
Connecticut Post Mall.............................................. $ 1.9 $ 151
Montgomery Mall.................................................... 2.2 151
The Plaza at West Covina........................................... 2.3 124
South Shore Mall................................................... 3.9 77
Trumbull Shopping Park............................................. 1.7 99
</TABLE>

The Company believes that Connecticut Post Mall, Montgomery Mall, The Plaza
at West Covina, South Shore Mall and Trumbull Shopping Park are adequately
covered by existing insurance.

For information concerning indebtedness and mortgages relating to
Connecticut Post Mall, Montgomery Mall, The Plaza at West Covina, South Shore
Mall and Trumbull Shopping Park, see"--Debt Summary."

ADDITIONAL INFORMATION REGARDING ANNAPOLIS MALL

Annapolis Mall is located in Annapolis, Maryland and is owned by Annapolis
Mall Limited Partnership. RREEF USA Fund--III/Annapolis, Inc. is a 70% partner
in such partnership and CenterMark Properties of Annapolis, Inc., a wholly owned
subsidiary of the Company, is a 30% partner in such partnership. The Company has
entered into a letter of intent with RREEF USA Fund--III/Annapolis, Inc. to
acquire its 70% interest in the partnership. Although no assurance can be given
that such acquisition will occur, upon such acquisition Annapolis Mall would
have a book value which amounted to 10% or more of the total assets of the
Company in 1996. Annapolis Mall has over 990,000 square feet of Total GLA, with
148 Mall Stores and four Anchors: Hecht's, Montgomery Ward, J.C. Penney and
Nordstrom.

The Limited is the only tenant at the Center that leased 10% or more of
Total GLA as of December 31, 1996. The principal terms of The Limited's leases
are set forth below:

<TABLE>
<CAPTION>
BASE RENTAL SQUARE LEASE
TENANT PER ANNUM FEET EXPIRATION OPTIONS PERCENTAGE RENT(1)
- ---------------------------------- ------------ --------- ---------- --------- --------------------------------
<S> <C> <C> <C> <C> <C>
Express........................... $ 303,862 11,687 1/31/07 None 5% of sales over $ 6,077,240
Lane Bryant....................... 164,832 9,696 1/31/09 None 5% of sales over $ 3,296,640
Lerner New York................... 216,988 13,312 1/31/09 None 5% of sales over $ 4,339,760
Limited Too....................... 147,648 4,614 1/31/06 None 5% of sales over $ 2,952,960
Limited, The...................... 409,890 15,765 1/31/10 None 4% of sales over $ 10,247,250
Structure......................... 163,930 6,305 1/31/06 None 5% of sales over $ 3,278,600
Victoria's Secret................. 186,914 7,189 1/31/07 None 5% of sales over $ 3,738,280
------------ ---------
$ 1,594,064 68,568
------------ ---------
------------ ---------
</TABLE>

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

(1) Percentage rent is calculated based upon sales in excess of stipulated
minimums which may vary from lease to lease.

The following charts sets forth the Mall Store sales for Annapolis Mall:

<TABLE>
<CAPTION>
YEAR MALL STORE SALES (PSF)(1)
- -------------------------------------------------------------------- ---------------------------
<S> <C>
1994................................................................ $ 280
1995................................................................ 336
1996................................................................ 371
</TABLE>

- --------------
(1) Sales are based on Mall Stores reporting sales.

88
<PAGE>
Mall Stores leased at Annapolis Mall were 96% in 1996, 97% in 1995, 98% in
1994, 90% in 1993 and 76% in 1992 at December 31 of each such year.

The following table sets forth certain information with respect to the
expiration of leases at Annapolis Mall as of December 31, 1996:

<TABLE>
<CAPTION>
APPROXIMATE AVERAGE BASE ANNUALIZED PERCENTAGE OF
MALL GLA OF PERCENTAGE OF RENT (PSF) BASE RENT BASE ANALIZED
NUMBER OF EXPIRING MALL GLA UNDER OF EXPIRING RENT
LEASES LEASES REPRESENTED BY EXPIRING LEASES REPRESENTED BY
YEAR ENDING DECEMBER 31 EXPIRING (SQUARE FEET) EXPIRING LEASES LEASES (THOUSANDS) EXPIRING LEASES
- -------------------------------- ------------- ------------- --------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
1997............................ 2 4,438 1.2% $ 37.79 $ 168 1.3%
1998............................ 5 2,503 0.7 90.68 227 1.8
1999............................ 7 9,192 2.5 35.95 330 2.6
2000............................ 11 16,151 4.5 44.63 721 5.6
2001............................ 15 25,169 6.9 37.48 943 7.4
2002............................ 2 503 0.1 135.19 68 0.5
2003............................ 13 28,082 7.7 38.96 1,094 8.5
2004............................ 37 58,833 16.2 45.23 2,661 20.8
2005............................ 19 54,578 15.0 38.10 2,080 16.2
2006............................ 15 52,885 14.6 33.15 1,753 13.7
</TABLE>

Minimum rents at Annapolis Mall are expected to grow based upon contractual
increases in base rent in the existing leases, although there can be no
assurance that such contractual increases will be realized or that such
contractual increases are indicative of possible future increases in base rent.
In the aggregate, base rent is expected to increase by approximately $1,795,429
over the next five years through these contractual increases.

<TABLE>
<CAPTION>
EXISTING CUMULATIVE EXISTING
CONTRACTUAL RENT CONTRACTUAL RENT
YEAR INCREASES INCREASES
- ---------------------------------------------- ------------------- -------------------------
<S> <C> <C>
1997.......................................... $ 351,686 $ 351,686
1998.......................................... 667,270 1,018,956
1999.......................................... 350,251 1,369,207
2000.......................................... 160,195 1,529,402
2001.......................................... 266,027 1,795,429
</TABLE>

The average effective (base plus percentage rent) annual rent per square
foot was $36 psf for 1996, $33 psf for 1995, $32 psf for 1994, $26 psf for 1993
and $24 psf for 1992.

Annapolis Mall in Annapolis, Maryland has one regional shopping center in
its Primary Trade Area. Annapolis Mall with four anchors and total GLA of
990,702 square feet in the largest super regional shopping center in its trade
area.

As a result of the expansion and renovation of Annapolis Mall and the
favorable market position of Annapolis Mall in the Annapolis, Maryland trade
area, management was able to increase base rent psf for leases expiring during
the past three years as illustrated below.

<TABLE>
<CAPTION>
LEASES LEASES
ALL EXPIRING EXECUTED
EXISTING DURING THE DURING THE
YEAR LEASES PERIOD (1) PERIOD (2)
- ----------------------------------------------------------- ----------- ----------- -----------
<S> <C> <C> <C>
1994....................................................... $ 30.90 $ 20.69 $ 39.09
1995....................................................... 32.73 30.30 44.11
1996....................................................... 35.31 24.17 47.67
</TABLE>

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

(1) Includes scheduled expirations, early terminations, abandonments and
negotiated buyouts. Represents average base rent for the final year of
occupancy.

(2) Includes renewals. Represents average base rent for the initial year of
occupancy.

89
<PAGE>
Annual real estate taxes for Annapolis Mall in 1996 were $1.1 million. At
December 31, 1996, Annapolis Mall's gross Federal income tax basis was
approximately $103 million. The Company intends to compute depreciation on
Annapolis Mall for Federal income tax purposes the straight line method based on
useful lives ranging from 3 to 40 years for accounting purposes using the
straight-line method based on useful lives of 7 to 20 years for buildings and
improvements and 5 to 14 years for equipment and fixtures. See "Federal Income
Tax Considerations--Taxation of the Company."

The Company believes that Annapolis Mall is adequately covered by existing
insurance.

Annapolis Mall is not encumbered by any mortgage debt.

ADDITIONAL INFORMATION REGARDING GARDEN STATE PLAZA

Garden State Plaza is located in Paramus, New Jersey and is 50% indirectly
owned by Westland Realty, Inc., a wholly owned subsidiary of Westfield Holdings
Limited, and 50% by HRE Garden State Plaza, Inc., an affiliate of Rodamco North
America B.V. Garden State Plaza has over 2.0 million square feet of Total GLA,
with 294 Mall Stores and five Anchors: Nordstrom, Macy's, Neiman Marcus, Lord
and Taylor and J.C. Penney. The center is currently under redevelopment.

At any time after January 1, 2000, either Westfield Holdings or HRE Garden
State Plaza, Inc. can force a sale of the property. The partner initiating the
sale must allow the other partner 150 days to accept the offer for sale. If the
noninitiating partner does not accept the offer, the initiating partner shall
have the right during the succeeding 12 month period to sell the entire property
for a price not less than 95% of the proposed price.

The Company has an option to acquire the stock of Westland Realty, Inc. and,
thus, the indirect 50% interest in Garden State Plaza. The Garden State Plaza
Option is exercisable following the completion of an independent valuation of
the property to determine its fair market value. Contemporaneously with the
closing of the Offerings, the Garden State Plaza Option will be amended to
provide that the valuation procedure may be commenced by the Company upon the
earliest to occur of (x) any time after completion and stabilization of the
current expansion of the property, defined to mean the leasing of 95% of the
mall gross leasable area for the expansion, (y) any time after the date which is
18 months after completion of the current expansion of the property and (z) no
later than January 3, 2000. The valuation is to be performed by an independent
appraiser approved by the Company and Westfield Holdings within 30 days after
the Company elects to commence the valuation procedure. The purchase price under
the Garden State Plaza Option is equal to 50% of such fair market valuation,
subject to adjustment for the mortgage debt of Garden State Plaza, the Garden
State Plaza Loan and the amount by which current assets exceed current
liabilities. The exercise of the Garden State Plaza Option will require the
approval of at least 75% of the Independent Directors and, if the purchase price
(which is payable in Common Stock) will exceed $55 million (net of the $145
million Garden State Plaza Loan), the approval of a majority of the holders of
the Common Stock voting at a meeting on such issue other than Westfield Holdings
and its affiliates (including, without limitation, WAT) and interests associated
with the Lowy Family. The Garden State Plaza Option must be exercised within 120
days after delivery of the determination of the fair market value of the
property. The Company believes that the conditions to the exercise of Garden
State Plaza Option will first be satisfied in the summer of 1999 based on the
right to exercise 18 months after substantial completion; however, the option
may first be satisfied at an earlier date if the property is 95% leased. The
Board of Directors (including at least 75% of the Independent Directors) and, if
the purchase price exceeds $55 million (net of the $145 million Garden State
Plaza Loan) as described above, the shareholders of the Company will determine
whether to exercise the Garden State Plaza Option. The book value of Westfield
Holdings' interest in Garden State Plaza, calculated in accordance with
Australian generally accepted accounting principles, is approximately $200
million.

The Company is using $145.0 million of the proceeds of the Offerings and
concurrent transactions to make the Garden State Plaza Loan. The amount of this
loan, as well as the book value of Garden State Plaza if the Company elects to
exercise the Garden State Plaza Option, would amount to 10% or more of the total
assets of the Company in 1996.

90
<PAGE>
Macy's, Nordstrom and J.C. Penney are the only tenants at the center that
leased 10% or more of the rentable square footage as of December, 31 1996. The
principal terms of Macy's, Nordstrom's and J.C. Penney's leases are set forth
below.

<TABLE>
<CAPTION>
BASE RENTAL SQUARE LEASE % RENT
ANCHORS PER ANNUM FEET EXPIRATION OPTIONS PROVISION
- ------------------------------------------------- ------------ --------- ------------ --------- --------------
<S> <C> <C> <C> <C> <C>
Macy's........................................... $ 6,183,704 439,632 7/31/21 (a) none
Nordstrom........................................ 2,614,295 245,348 7/31/06 (b) none
J.C. Penney...................................... 1,200,000 180,000 10/31/20 (c) 1.5% of sales
in excess of
$60 million
------------ --------- --------------
Total.......................................... $ 9,997,999 864,980 --
------------ ---------
------------ ---------
</TABLE>

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

(a) Eight self-existing successive options. The first option is for a 5-year
period and thereafter each option is for a period of 7 years

(b) Eight 10-year options

The following charts sets forth the Mall Store sales for Garden State Plaza:

<TABLE>
<CAPTION>
MALL STORE SALES
YEAR (PSF) (1)
- ------------------------------------------------------------------- -----------------
<S> <C>
1994............................................................... $ 450
1995............................................................... 433
1996............................................................... 467
</TABLE>

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

(1) Sales are based on Mall Stores reporting sales.

Mall Stores leased at Garden State Plaza were 92% in 1996, 94% in 1995, 98%
in 1994, 99% in 1993 and 95% in 1992 at December 31 of each such year. During
1995 and 1996 the Garden State Plaza was under redevelopment.

The following table sets forth certain information with respect to the
expiration of leases at Garden State Plaza as of December 31, 1996:

<TABLE>
<CAPTION>
APPROXIMATE
MALL GROSS PERCENTAGE OF AVERAGE BASE ANNUALIZED PERCENTAGE OF
LEASABLE AREA MALL GROSS RENT (PSF) BASE RENT BASE ANNUALIZED
NUMBER OF OF EXPIRING LEASABLE AREA UNDER OF EXPIRING RENT
LEASES LEASES REPRESENTED BY EXPIRING LEASES REPRESENTED BY
YEAR ENDING DECEMBER 31 EXPIRING (SQUARE FEET) EXPIRING LEASES LEASES (THOUSANDS) EXPIRING LEASES
- ----------------------------------- ------------- ------------- --------------- ------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
1997............................... 20 25,690 4.9 % $ 48.07 $ 1,248 4.7%
1998............................... 13 20,171 3.8 52.61 1,061 4.0
1999............................... 28 65,076 12.25 47.45 3,088 11.5
2000............................... 7 12,724 2.40 51.34 653 2.4
2001............................... 13 33,590 6.32 43.75 1,469 5.5
2002............................... 7 37,770 7.11 62.33 2,354 8.8
2003............................... 11 29,296 5.52 49.32 1,445 5.4
2004............................... 9 22,924 4.32 52.85 1,212 4.5
2005............................... 14 81,251 15.30 38.06 3,092 11.6
2006............................... 18 24,331 4.58 71.61 1,742 6.5
</TABLE>

Minimum rents at Garden State Plaza are expected to grow based upon
contractual increases in base rent in the existing leases, although there can be
no assurance that such contractual increases will be realized or that such
contractual increases are indicative of possible future increases in base rent.
In the

91
<PAGE>
aggregate, base rent is expected to increase by approximately $1,174,369 over
the next five years through these contractual increases.

<TABLE>
<CAPTION>
EXISTING CUMULATIVE EXISTING
CONTRACTUAL RENT CONTRACTUAL RENT
YEAR INCREASES INCREASES
- ---------------------------------------------- ------------------- -------------------------
<S> <C> <C>
1997.......................................... $ 401,290 $ 401,290
1998.......................................... (65,874) 335,416
1999.......................................... 25,056 360,472
2000.......................................... 416,072 776,544
2001.......................................... 397,825 1,174,369
</TABLE>

The average effective (base plus percentage) annual rent per square foot was
$51 psf for 1996, $44 psf for 1995, $39 psf for 1994, $38psf for 1993 and $34
psf for 1992.

Four other regional shopping centers compete with Garden State Plaza in its
Primary Trade Area. Garden State Plaza has five department stores and a larger
number of mall stores than any other regional shopping center within its trade
area.

As a result of the expansion and renovation of Garden State Plaza and the
favorable market position of Garden State Plaza in the Paramus, New Jersey trade
area, management was able to increase base rent psf for leases expiring during
the past three years as illustrated below.

<TABLE>
<CAPTION>
LEASES LEASES
ALL EXPIRING EXECUTED
EXISTING DURING THE DURING THE
YEAR LEASES PERIOD(1) PERIOD(2)
- ----------------------------------------------------------- ----------- ----------- -----------
<S> <C> <C> <C>
1994....................................................... $ 36.32 $ 40.70 $ 46.86
1995....................................................... 41.71 29.91 64.35
1996....................................................... 50.40 32.11 53.74(3)
</TABLE>

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

(1) Includes scheduled expirations, early terminations, abandonments and
negotiated buyouts. Represents average base rent for the final year of
occupancy.

(2) Includes renewals. Represents average base rent for the initial year of
occupancy.

(3) Comprised of leases executed by 28 tenants covering approximately 71,270
square feet (3% of total gross leasable area), of which one lease was signed
by Abercrombie & Fitch consisting of 11,155 square feet at $42.00 psf.

Annual real estate taxes for Garden State Plaza in 1996 were $4.1 million.
At December 31, 1996, Garden State Plaza's gross Federal income tax basis was
approximately $540.0 million. The partnership which owns Garden State Plaza
computes depreciation for income tax purposes using the straight line method of
depreciation based on 5 to 40 years, and for accounting purposes using the
straight line method based on useful lives of 3 to 35 years.

The Company believes that Garden State Plaza is adequately covered by
existing insurance.

Prudential has a first mortgage on Garden State Plaza totaling $260.02
million. This loan bears interest at 8.23% per annum, matures in May 2005 and is
a non-recourse obligation of the owner of Garden State Plaza.

ADDITIONAL INFORMATION REGARDING WHEATON PLAZA

Wheaton Plaza is located in Wheaton, Montgomery County, Maryland and serves
a populous, urban/ suburban trade area that includes the towns of Kensington,
Wheaton, Silver Springs, the northern Washington D.C. suburbs and parts of
Montgomery County. The center's Trade Area has a population of 410,600 with an
average household income of $70,500.

92
<PAGE>
The enclosed, one level (with a two level connection to Hecht's) center
opened in 1960 and has approximately 1.1 million square feet of total gross
leasable area, with 120 mall stores and three anchors: J.C. Penney (which in
1996 replaced Woodward & Lothrop), Montgomery Ward and Hecht's; and two free
standing office buildings of approximately 107,000 square feet and approximately
73,000 square feet, on an 80-acre site. The site is 100% owned by Wheaton Plaza
Regional Shopping Center, LLP, in which the Company intends to acquire a 70%
general partnership interest, and will be the sole general partner.

Under the terms of the partnership agreement which terminates on December
31, 2047, (i) the Company, as managing partner, will have authority and
discretion to make all decisions affecting the business and affairs of the
partnership; however, the limited partners shall have consent rights with
respect to certain matters, including the annual operating budget, financing,
sale of the project and certain leasing matters, (ii) management and development
services will be provided by Westfield Holdings, and (iii) under certain
circumstances the limited partners will have the right to transfer their
partnership interests to the Company for cash or operating partnership units if
the Company forms an operating partnership, or shares in the Company if the
Company's shares are listed on a national stock exchange and the Company has not
formed an operating partnership.

There are no regional shopping centers in the center's Primary Trade Area;
however, three regional shopping centers compete with the center. J.C. Penney
and Montgomery Ward are the only tenants at the center that leased 10% or more
of rentable square footage as of December 31, 1996. The principal terms of J.C.
Penney and Montgomery Ward leases are set forth below.

<TABLE>
<CAPTION>
BASE RENTAL SQUARE LEASE
ANCHORS PER ANNUM FOOTAGE EXPIRATION OPTIONS % RENT PROVISION
- ------------------------------ ----------- --------- ----------- --------- ------------------------------------------
<S> <C> <C> <C> <C> <C>
J.C. Penney $ 20,000 218,667 8/31/09 (A) 1.5% of sales up to and including
$6,500,000
1.25% of sales in excess of $6,500,000
1.0% of sales in excess of $7,500,000
0.75% of sales in excess of $10,000,000
Montgomery Ward 240,810 227,700 2/28/00 (B) 2.25% of sales up to and including
$13,460,000 less minimum rent
1.75% of sales in excess of $13,460,000
----------- ---------
Total $ 260,810 446,367
----------- ---------
----------- ---------
</TABLE>

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

(A) Three successive options for 20 years each.

(B) One 10 year option.

The following charts sets forth the Mall Store sales for Wheaton Plaza:

<TABLE>
<CAPTION>
MALL STORE SALES (PSF)
YEAR (1)
- ------------------------------------ -------------------------
<S> <C>
1994................................ $ 247
1995................................ 266
1996................................ 281
</TABLE>

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

(1) Sales are based on Mall Stores reporting sales.

Mall Stores leased at Wheaton Plaza were 92% in 1996, 94% in 1995, 94% in
1994, 92% leased in 1993 and 93% leased in 1992 at December 31 of each such
year.

93
<PAGE>
The following table sets forth certain information with respect to the
expiration of Mall Store leases (excluding outparcels) at Wheaton Plaza as of
December 31, 1996:

<TABLE>
<CAPTION>
APPROXIMATE AVERAGE BASE ANNUALIZED PERCENTAGE OF
MALL GLA OF RENT (PSF) BASE RENT BASE ANNUALIZED
NUMBER OF EXPIRING PRECENTAGE OF MALL UNDER OF EXPIRING RENT
YEAR ENDING LEASES LEASES GLA REPRESENTED BY EXPIRING LEASES REPRESENTED BY
DECEMBER 31 EXPIRING (SQUARE FEET) EXPIRING LEASES LEASES (THOUSANDS) EXPIRING LEASES
- ------------------------------ ------------- ------------- ------------------- ------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
1997.......................... 21 42,431 18.8% $ 25.68 $ 1,090 19.3%
1998.......................... 20 32,249 14.3% 32.11 1,036 18.3%
1999.......................... 8 10,508 4.7% 26.87 282 5.0%
2000.......................... 8 24,000 10.7% 26.76 642 11.3%
2001.......................... 10 18,365 8.2% 23.18 425 7.5%
2002.......................... 7 14,808 6.6% 27.74 411 7.3%
2003.......................... 4 14,449 6.4% 22.94 331 5.9%
2004.......................... 5 11,417 5.1% 20.38 233 4.1%
2005.......................... 5 15,949 7.1% 19.34 308 5.4%
2006.......................... 5 31,703 14.1% 22.16 702 12.4%
</TABLE>

Minimum rents at Wheaton Plaza are expected to grow based upon contractual
increases in base rent in the existing leases although there can be no assurance
that such contractual increases will be realized or that such contractual
increases are indicative of possible future increases in base rent. In the
aggregate, base rent is expected to increase by approximately $274,399 over the
next five years through these contractual increases.

<TABLE>
<CAPTION>
EXISTING CUMULATIVE EXISTING
CONTRACTUAL RENT CONTRACTUAL RENT
YEAR INCREASES INCREASES
------------------- -------------------------
<S> <C> <C>
1997.................. $ 13,498 $ 13,498
1998.................. 110,719 124,217
1999.................. 59,023 183,240
2000.................. 72,425 255,665
2001.................. 18,734 274,399
</TABLE>

The average effective (base plus percentage) annual rent per square foot was
$25 psf for 1996, $26 psf for 1995, $26 psf for 1994, $26 psf for 1993 and $27
psf for 1992.

Annual real estate taxes for Wheaton Plaza in 1996 were $1.8 million.
Federal income tax basis cannot be determined until the acquisition of the
center is consummated.

The Company believes that Wheaton Plaza is adequately covered by existing
insurance. Wheaton Plaza is unencumbered.

MAY PROPERTIES

The Company holds interests in 13 department store properties (12 of which
are owned in fee and one of which is ground leased) that were net leased to the
May Company in 1988 under financing leases. Each lease has an original term of
29 years, ending on September 21, 2017, with 14 consecutive five-year options
exercisable by the May Company. Upon termination of each lease, the May Company
has an option to acquire the Company's interest in each of the May Properties
for their respective fair market value as determined by appraisal. The leases
are at fixed rental rates that do not increase over the terms of the leases and
provide that the tenant is to pay for all taxes, maintenance, repair and other
expenses. Eleven of the May Properties are operated by various divisions of the
May Company. Two of the May Properties have been assigned to other operators,
but the May Company remains liable for the performance of the tenant's
obligations thereunder. One of these properties is for a store that is currently
vacant, although rent is being paid on it. The leased properties are located in
Buena Park, Oxnard, San Bernardino, El

94
<PAGE>
Cajon, Redondo Beach, Costa Mesa, Riverside, Westminster and West Los Angeles,
California; Waterbury, Connecticut; Salem, Oregon; Elyria, Ohio; and
Springfield, Missouri. The May Properties generated rent of $8.4 million in
1996, and the Company paid $7.7 million of interest and principal in 1996 on the
loans associated with the financing of the May Properties. See "--Debt Summary."

OTHER REAL ESTATE INTERESTS

The Company owns interests in Properties other than the Centers, which
represented less than 1.0% of 1996 Funds from Operations.

The Company owns a 42.5% partnership interest in the West Valley
Partnership, which is the fee owner of a 36-acre tract of land in Canoga Park,
California, directly across from Topanga Plaza. There are currently six
free-standing stores on the Property, representing a total of 89,128 square feet
of rentable area. In addition, West Valley Partnership is a limited partner in
an entity that owns two office buildings located on such land which is ground
leased by West Valley Partnership to such entity.

The Company is the holder of a $2,850,000 promissory note, which is secured
by a first deed of trust on property known as Northland Shopping Center in St.
Louis, Missouri. The loan is recourse to the borrower and bears interest at a
rate of 7% per annum. Interest only is receivable under the note until June 7,
1997, when the entire principal balance will become due. The borrower has five
one-year options to extend the maturity date of the loan.

The Company also owns indirect interests in a certain office building and
land adjacent to the Mid Rivers Mall and is the owner of a 116-unit apartment
complex in La Jolla, California.

INSURANCE ARRANGEMENTS

As part of its management services for the Properties under Westfield
Holdings's management, the Manager is responsible for arranging insurances for
such Properties to cover fire, flood, earthquake, comprehensive liability and
other appropriate risks. The Company's insurance advisors/brokers have reported
that these insurances are adequate having regard to the insurance risks and
insured limits customarily carried for similar properties. The Company will
continue fire, business interruption, flood, earthquake, comprehensive liability
and other appropriate insurance with respect to such Properties and believes
that such Properties are adequately covered by existing insurance. The Company
carries earthquake insurance on all Centers under Westfield Holdings's
management. Such policies are subject to a deductible equal to 5% of the total
insured value of each Center managed by Westfield Holdings and a combined annual
aggregate loss limit of $100 million on the Centers. See "Advisory, Management
and Development Services to the Company."

EMPLOYEES

The Company has engaged the Manager to provide the property management and
leasing services, the Advisor to provide advisory services and the Developer to
provide development and redevelopment planning and implementation. All of the
employees of the Manager, the Advisor and the Developer are employees of
Westfield Holdings. The Company has no employees. See "Advisory, Management and
Development Services to the Company."

DEBT SUMMARY

The following table reflects indebtedness of the Company that will remain
outstanding following the consummation of the Offerings and concurrent
transactions.

95
<PAGE>
WESTFIELD AMERICA, INC.
OUTSTANDING MORTGAGE DEBT AFTER THE OFFERINGS AND CONCURRENT TRANSACTIONS
<TABLE>
<CAPTION>
COMPANY'S PRO
RATA SHARE
PRINCIPAL -------------
LIBOR AT BALANCE AS PRINCIPAL
ANNUAL REPRICING OF BALANCE AS OF
LENDER INTEREST RATE (A) DATE 3/31/97(B) 3/31/97(B)
-------------------- ------------------ ------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
($ IN THOUSANDS)
Corporate Debt:
Unsecured Corporate Line of Credit
($600,000)......................... Various (1) LIBOR + 1.00% (2) 5.69% $ 244,993 $ 244,993
Property Debt:
Wholly Owned
Various (3)........................ Prudential 6.15% 172,000 172,000
Various (3)........................ Prudential 6.51% 167,000 167,000
Mid Rivers Mall (3)................ Prudential 8.09% 15,000 15,000
Trumbull Shopping Park............. Equitable 7.07% 143,960 143,960
General Partnerships Interests
Meriden Square..................... Hypo Bank LIBOR + 1.50% (2) 5.44% 50,000 25,000
Mission Valley Center.............. Bank of America LIBOR + 1.45% (4) 5.39% 38,899 29,485
Plaza Camino Real.................. John Hancock 9.50% 37,073 14,829
Topanga Plaza...................... Cigna 10.125% 57,579 24,183
Vancouver Mall..................... AEW 9.78% 31,820 15,910
Limited Partnership interest
North County Fair.................... Teachers Insurance 12.25% (5) 49,827 22,422
------------ -------------
763,158 629,789
------------ -------------
Finance Lease Debt..................... Various (10) 6.39% 20,576 20,576
Various (11) 7.33% 55,834 55,834
------------ -------------
76,410 76,410
------------ -------------
Total Debt............................. $1,084,561 $ 951,192
------------ -------------
------------ -------------

EARLIEST
ANNUAL ANNUAL BALANCE NOTES MAY
INTEREST DEBT DUE AT MATURITY BE PREPAID
PAYMENT SERVICE MATURITY DATE W/O PENALTY
----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>

Corporate Debt:
Unsecured Corporate Line of Credit
($600,000)......................... $ 16,390 $ 16,390 $ 244,993 5/2000 now
Property Debt:
Wholly Owned
Various (3)........................ 10,578 10,578 172,000 2/1999 2/1999(6)
Various (3)........................ 10,872 10,872 167,000 2/2001 2/2001(6)
Mid Rivers Mall (3)................ 1,214 1,214 15,000 2/1999 2/1999(6)
Trumbull Shopping Park............. 10,005 10,896 130,063 7/2000 4/2000(7)
General Partnerships Interests
Meriden Square..................... 1,735 1,735 25,000 3/1999 now
Mission Valley Center.............. 2,105 2,105 28,786 8/2000 now
Plaza Camino Real.................. 1,404 1,515 14,427 6/2000 6/2000(8)
Topanga Plaza...................... 2,440 2,637 23,014 1/2002 1/2002(8)
Vancouver Mall..................... 1,549 1,701 14,917 5/2002 5/2002(9)
Limited Partnership interest
North County Fair.................... 2,739 2,879 238 6/2022 6/2022(5)
----------- ----------- -----------
44,641 46,132 590,445
----------- ----------- -----------
Finance Lease Debt..................... 1,287 3,108 0 2/2004 2/2004
4,057 4,724 0 2/2014 2/2014
----------- ----------- -----------
5,344 7,832 0
----------- ----------- -----------
Total Debt............................. $ 66,375 $ 70,354 $ 835,438
----------- ----------- -----------
----------- ----------- -----------
</TABLE>

- ----------------------------------
(a) All loans are at a fixed interest rate unless stated as LIBOR plus a spread.

(b) All balances reflect additional borrowings of principal on the Company's
unsecured corporate credit line. See "Use of Proceeds."

(1) Participating revolving credit facility that is expected to close
concurrently with the Offerings. Participant lenders include National
Australia Bank Limited, Commonwealth Bank of Australia, Australia and New
Zealand Banking Group Limited and Union Bank of Switzerland.

(2) The Company generally reprices these LIBOR contracts every 30 days.

(3) Includes cross collateralized first mortgage covering the following
properties: Mid Rivers Mall, West Park Mall, Plaza Bonita Mall, The Plaza at
West Covina, Montgomery Mall, South County Center and West County Center.

(4) Borrowings totaling $22,073 have been fixed at 7.5% through August 1997,
with the remaining debt balance at LIBOR plus 1.75% for which the LIBOR
contract is repriced every 30 days.

(5) Lender is entitled to contingent interest equal to 30% of annual applicable
receipts in excess of $8.3 million. Beginning June 1, 2004, the loan may be
prepaid for a 6% premium; this declines to a minimum of 1% plus ten times
contingent interest.

(6) May be prepaid with a premium equal to the greater of Yield Maintenance
Premium or a declining 1% premium.

(7) May be prepaid in entirety with 60 day irrevocable notice subject premium
equal to greater of Yield Maintenance Premium or 1% of balance until April
1, 2000. Thereafter, no prepayment premium.

(8) May be prepaid for greater of 1% of outstanding principal balance or Yield
Maintenance Premium.

(9) May be prepaid for greater of 2% of outstanding principal balance or Yield
Maintenance Amount.

(10) Nationwide Life Insurance Co. and EBENCO--Farmer's Insurance Exchange.

(11) Phoenix Home Life Mutual Insurance Company, American United Life Insurance
Co., GALICO, Central Life Insurance Company, Physicians Life Insurance
Company, Guarantee Trust Life Insurance Company Annuity Portfolio Pocket #2,
INCE & Co.--Equitable, INCE & Co.--Kanawah, Physicians Mutual Insurance
Company, The Franklin Life Insurance Company, EBENCO-- Truck Insurance
Exchange, EBENCO--Farmers New World Life, EBENCO--Ohio State Life Insurance
Company.

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The Company has entered into a letter of intent with National Australia Bank
Limited, Australia and New Zealand Banking Group Limited, Commonwealth Bank of
Australia and Union Bank of Switzerland for a new $600.0 million loan facility.
A portion of the proceeds of the facility would be used by the Company to repay
existing mortgage loans in the aggregate amount of approximately $163.0 million.
The remaining portion of the loan would be used by the Company to fund its
acquisition and redevelopment activities and as a revolving working capital
facility. The loan will have a three-year 'evergreen' term (with the evergreen
being exercised every year with the approval of the bank lenders so that if the
evergreen is not exercised there is a two-year period prior to maturity) and
will have an interest rate of LIBOR plus 100 basis points. The Company will
agree to a negative pledge with respect to substantially all of the Company's
wholly-owned properties that are presently unencumbered and the loan facility
will include customary financial covenants, including, without limitation, the
maintenance of certain debt service coverage ratios, the maintenance of minimum
shareholder equity, limitations on additional indebtedness, limitations on the
payment of distributions in any calender year in excess of 100% of Funds from
Operations for such year and limitations on the changing the Advisor and Manager
of the Company. Borrowings under the loan facility are limited to 60% of the
value of the negative pledged properties. On a pro forma basis, the current
availability under the loan facility is approximately $355 million. Borrowings
under the facility are expected to be guaranteed by subsidiaries that own the
negative pledge properties. There can be no assurance that a definitive credit
agreement with respect to this loan facility will be entered into or that any
definitive agreement will be as described above.

The Company has also entered into interest rate exchange agreements with a
counterparty to manage future interest rates. These agreements consist of swaps
and involve the future receipt, corresponding with the expiration of existing
fixed rate mortgage debt, of a floating rate based on LIBOR and the payment of a
fixed rate. At December 31, 1996, the Company had interest rate exchange
agreements beginning February 11, 1999 and expiring after three years with
notional principal amounts totaling $90 million which provide that the Company
will pay 6.125% per annum. Subsequently, the Company entered into interest rate
exchange agreements beginning in February 1999 and April 2000 and expiring at
various dates in 2002 with notional principal amounts totaling $227 million
which provide that the Company will pay 6.25% per annum. These exchange rate
agreements ensure that, upon the expiration of certain of the Company's mortgage
debt, if the Company refinances such debt with new LIBOR based loans, the
interest rate on such loans will be no more than 6.125% or 6.25%, plus the
applicable spread of the loan at such time.

ENVIRONMENTAL MATTERS

Various Federal, state and local laws, ordinances and regulations impose
liability on present and former property owners and operators for the cost of
cleaning up or removing hazardous or toxic materials that are present on or
emanated from such property. Such laws often impose liability without regard to
whether the owner knew of, or was responsible for, the presence of such
hazardous or toxic materials. The presence of contamination on, or even adjacent
to or near, a property may impact the valuation of that property or the ability
of the owner to sell, lease or finance it. In addition, persons who arrange for
the disposal or treatment of hazardous or toxic materials may be liable for the
costs of cleaning up contamination that results from the effort to dispose of or
treat those materials at another site.

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The Company's independent consultant has reviewed certain existing
environmental reports, including "Phase I" site assessments (which generally
include a visual site inspection, interviews and a records review) of the
Centers and certain formerly owned properties. The environmental reports were
prepared in 1993 for all of the Centers other than the Acquired Properties and
in 1996 for the Acquired Properties. Although all of the environmental reports
were made available to the Company, a majority of the reports were prepared for
parties other than the Company and the Company does not have recourse against
the preparer of such reports in the event such reports are inaccurate. On the
basis of this review and other environmental investigations of various outside
consultants commissioned by the Company and Management's operation of the
Properties, the Company believes that certain properties have had or currently
have operations (primarily gas stations and tire, battery and auto centers) that
may have or have resulted in soil or groundwater contamination. In that regard,
many of the properties contain, or at one time contained, underground storage
tanks and/or above-ground storage tanks that are or were used to store waste
oils or other petroleum products. At certain properties, underground storage
tanks have been abandoned in place (i.e., their use has been discontinued but
the structures were not removed from the ground) or removed. In some instances,
the Company is not aware whether such actions complied with laws or regulations
that mandate or regulate the manner of such abandonment or removal. In certain
instances, current or former underground storage tanks have been the sources of
known soil or groundwater contamination.

The Properties also could be negatively impacted, either through physical
contamination or by virtue of an adverse effect on value, from contamination
that has or may have emanated from other properties. Most of the adjacent or
nearby properties of concern are or were operated as gas stations containing
underground storage tanks, though some have been the sites of other types of
industrial operations. Several Properties are located in areas that are known to
have regional groundwater contamination. Such contamination could impact the
Properties.

Certain laws and regulations also impose liability for the release of
certain materials, including asbestos in the environment, and such releases can
form the basis for liability to third persons for personal injury, property or
other damages. Some of the Properties contain asbestos-containing materials.
Procedures have been adopted by the Company to monitor and maintain the
condition of such asbestos-containing materials.

LEGAL PROCEEDINGS

The Company is involved in routine litigation and administrative proceedings
arising in the ordinary course of business. Based on consultation with counsel,
management believes that such matters will not have a material adverse effect on
the Company's business, financial position or results of operations.

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POLICIES AND OBJECTIVES WITH RESPECT TO INVESTMENTS, FINANCING AND OTHER
ACTIVITIES

The following is a discussion of the Company's investment objectives and
policies, financing policies and policies with respect to certain other
activities. These policies may be amended or revised from time to time at the
discretion of the Board of Directors unilaterally and without a vote of the
Company's shareholders. Any such change would be made by the Board of Directors,
however, only after a review and analysis of such change, in light of then
existing business and other circumstances, and then only if, in the exercise of
their business judgment, they believe that it is advisable to do so in the best
interests of the Company. NO ASSURANCE CAN BE GIVEN THAT THE COMPANY'S
INVESTMENT OBJECTIVES WILL BE ATTAINED OR THAT THE VALUE OF THE COMPANY WILL NOT
DECREASE.

INVESTMENT OBJECTIVES AND POLICIES

In general, the Company's investment objectives are: (i) to increase the
value of the Company through increases in the cash flows and values of the
Centers (and any shopping centers or related properties hereafter acquired,
developed or expanded); (ii) to achieve long-term capital appreciation, and
preserve and protect the value of its interests in the Centers (and any shopping
centers or related properties hereafter acquired, developed or expanded); and
(iii) to provide quarterly or other periodic cash distributions, a portion of
which is expected to constitute a nontaxable return of capital because it will
exceed the Company's current and accumulated earnings and profits, as well as to
provide growth in distributions over time.

REAL ESTATE INVESTMENT POLICIES AND CRITERIA

The Company plans to invest primarily in super regional and regional
shopping centers and power centers in major metropolitan areas in the United
States and Canada. In connection with future acquisitions, the Company will
analyze other factors, including, but not limited to:

<TABLE>
<C> <S>
(i) the location and accessibility,
(ii) demographic profile,
(iii) redevelopment potential of the property,
(iv) the purchase price,
(v) the current and historical occupancy levels of the shopping centers and of
comparable properties in comparable locations,
(vi) the characteristics of tenants, including anchor tenants, and the terms of
their leases,
(vii) the quality of the construction and design of improvements, and
(viii) the relationship or fit of the shopping center with the other assets owned by
the Company.
</TABLE>

The Company plans to invest in properties both for income and for capital
appreciation. Subject to certain asset requirements necessary for REIT
qualification, the Company does not presently have a policy with respect to the
amount or percentage of assets which may be invested in any specific property or
other investment.

Even though super regional and regional shopping centers will be the
Company's primary focus, the Company also intends to evaluate, on a selective
basis, power center developments that, in the Company's opinion, will provide
acceptable rates of return. The Company has recently completed or substantially
completed the redevelopment of Eastland Center and Westland Towne Center into
power centers, and is planning for the redevelopment of Mission Valley
Center-West, one of the Company's existing power centers, and the land located
adjacent to Topanga Plaza into power centers.

ACQUIRING ADDITIONAL PROPERTIES

During the past three years, the Company has acquired an indirect interest
in the Acquired Properties and additional interests in one of the Centers. In
April 1994, the Company acquired the former May Company department store at
Eastland Center from the May Company pursuant to an option to purchase which was
acquired by the Company at the time the May Company store was relocated to The

99
<PAGE>
Plaza at West Covina. On January 27, 1995, the Company exchanged its interest in
the May Company department store located at University Hills, Denver, Colorado,
for an interest in the May Company department store located at Elyria Mall,
Elyria, Ohio pursuant to a tax-free exchange under Section 1031 of the Code. On
January 13, 1995, the Company acquired the Steiger's store at Enfield Square
from the May Company in anticipation of the redevelopment of Enfield Square. On
August 4, 1995, the Company purchased the Sak's Fifth Avenue store at Mission
Valley Center in San Diego, California, from Cal SFA, Inc. On September 5, 1995,
the Company acquired an additional 25.8% interest in the Mission Valley
Partnership, the owner of Mission Valley Center and Mission Valley Center--West.
On July 1, 1996, the Company acquired substantially all of the capital stock of
WPI, the owner of Connecticut Post Mall, South Shore Mall and Trumbull Shopping
Park, as part of the Recapitalization described in "Company Structure and
History." In addition, the Company has entered into a letter of intent to
purchase the remaining 70% interest in Annapolis Mall as well as an agreement to
acquire approximately 70% of the partnership interests in Wheaton Plaza Regional
Shopping Center LLP.

DISPOSITIONS

Shortly before the Company was acquired from Prudential, the Company's
interests in one shopping center were distributed to Prudential.

During the past three years the Company has disposed of its interest in a
few non-core properties. On December 24, 1995, the Company transferred its
interest in the May Company department store at University Hills Mall to the May
Company pursuant to the Section 1031 exchange. See "--Acquiring Additional
Properties" above. In addition to the above transfers, the Company has
transferred its interest in certain land pursuant to condemnation and eminent
domain proceedings or transfers of interest in lieu of condemnation. Other than
such dispositions, the Company has not disposed of interests in any shopping
centers since December 31, 1993. The Company has no current intention to dispose
of any of the Centers or its other related Properties, but does reserve the
right to do so if, based upon its periodic review of the Company's portfolio, it
determines that such action would be in the best interests of the Company. If
the Company does sell certain assets within ten years of the first day of the
first taxable year for which the Company qualified as a REIT (February 12,
1994), a corporate level tax would be imposed upon the Company with respect to
certain Built-In Gain. See "Federal Income Tax Considerations--Taxation of the
Company." Many of the Properties have significant Built-In Gain and this may
affect whether the Company decides to sell such Properties within such ten-year
period.

PARTNERSHIP RESTRUCTURING

On January 1, 1994, the Company restructured its partnership and management
rights in Plaza Camino Real, the limited partnership which owns Plaza Camino
Real, to increase its interest from a 5% general partnership interest to a 40%
general partnership interest and to provide for a separate management agreement,
which was subsequently assigned to the Manager. As of January 1, 1994, the
limited partnership interest in Tishman Warner Center Joint Venture held by the
West Valley Partnership was substantially reduced to a 1% interest as a result
of a restructuring of Tishman Warner Center Joint Venture. The 1% interest was
transferred in 1995. The Tishman Warner Center Joint Venture owns an office
building located on a tract of land adjacent to Topanga Plaza.

OTHER INVESTMENTS

Subject to the percentage of ownership limitations and gross income and
asset tests necessary for REIT qualification (see "Federal Income Tax
Considerations"), the Company may also invest in securities of concerns engaged
in real estate activities, including mortgages, stock of other REITs and other
real estate interests of other issuers. The Company may also invest in the
securities of other issuers in connection with acquisitions of indirect
interests in properties (normally general or limited partnership interests in
special purpose partnerships owning properties). The Company may in the future
acquire all or substantially all of the securities or assets of other REITs or
similar entities where such investments would be consistent with the Company's
investment policies as in its 1996 acquisition of substantially all the capital
stock of WPI. However, the Company does not anticipate investing in issuers of
securities (other than REITs in order to acquire interests in real property,
such as the stock of Westland Realty, Inc., a

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REIT, which owns an indirect 50% interest in Garden State Plaza, and its
interest in Westfield Holdings Limited through its holding of the Westfield
Holdings Warrants or any ordinary shares received upon the exercise thereof) for
the purpose of exercising control or acquiring any investments primarily for
sale in the ordinary course of business or holding any investments with a view
to making short-term profits from their sale. In any event, the Company does not
intend that its investments in securities will require the Company to register
as an "investment company" under the Investment Company Act of 1940, and the
Company intends to divest securities before any such registration would be
required. Over the past three years the Company has not and does not intend to
engage in material trading, underwriting, agency distribution or sale of
securities of other issuers.

FINANCING

The Company currently intends to adhere to a policy of maintaining a
debt-to-Total Market Capitalization ratio of not more than 50%. No assurance can
be given in this regard, however, and the organizational documents of the
Company do not limit the amount or percentage of indebtedness that it may incur.
On a pro forma basis at March 31, 1997, after giving effect to the consummation
of the Offerings and concurrent transactions and the application of the proceeds
as set forth in "Use of Proceeds", the Company would have a ratio of
debt-to-Total Market Capitalization of approximately 44%. The debt-to-Total
Market Capitalization ratio, which is based upon the market value of the
Company's equity and, accordingly, fluctuates with changes in the price of the
Common Stock, differs from debt-to-total asset ratio, which is based upon book
values. The consolidated pro forma debt-to-total asset ratio at March 31, 1997
was 51%. See "Capitalization" and The Company's Pro Forma Condensed Consolidated
Financial Information. The debt-to-total asset ratio may not reflect the current
income potential of the assets and the operating business. The Company believes
that debt-to-Total Market Capitalization provides a more appropriate indication
of leverage for a company whose assets are primarily operating real estate and
of its ability to repay debt. The Company may from time to time reevaluate its
debt policy in light of current economic conditions, relative costs of debt and
equity capital, changes in the Company's market capitalization, growth and
acquisition opportunities and other factors, and modify its debt financing
policy accordingly. As a result, the Company may increase its debt-to-Total
Market Capitalization ratio beyond the limits described above. See "Risk
Factors--Risks Associated with Debt Financing--No Limitation on Debt." If the
Board of Directors (or, in the case of certain Joint Ventures in which the
Company does not act as managing general partner, an Outside Partner) determines
that additional funding is required, the Company or the Joint Ventures may raise
such funds through additional equity offerings, debt financing or retention of
cash flow (subject to provisions in the Code concerning taxability of
undistributed income), or a combination of these methods.

Indebtedness incurred by the Company may be in the form of purchase money
obligations to the sellers of properties, or in the form of publicly or
privately placed debt instruments, financing from banks, institutional
investors, or other lenders, any of which indebtedness may be unsecured or may
be secured by mortgages or other interests in the Property. Such indebtedness
may be recourse, non-recourse or cross-collateralized and, if recourse, such
recourse may include the Company's general assets and, if non-recourse, may be
limited to the particular property to which the indebtedness relates. In
addition, the Company may invest in properties subject to existing loans secured
by mortgages, deeds of trust or similar liens on the properties, or may
refinance properties acquired on a leveraged basis. The proceeds from any
borrowings by the Company, or the Joint Ventures may be used for working
capital, to purchase additional partnership interests in the Joint Ventures or
other partnerships or joint ventures in which the Company participates, to
refinance existing indebtedness or to finance acquisitions, expansions or
development of new properties. The Company may also incur indebtedness for other
purposes when, in the opinion of the Board of Directors, it is advisable to do
so. In addition, the expected size of the Company's distributions may not allow
the Company, using only cash flow from operations, to fund 100% of (i) the
tenant allowances associated with renewal or replacement of current tenants as
their leases expire and (ii) the retirement of all of its debt when due, and
therefore, the Company may be required to seek periodic debt or equity
financings to cover such items. For example, the Company may borrow to meet the
taxable

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income distribution requirements under the Code if the Company does not have
sufficient cash available to meet those distribution requirements.

The Company intends to finance acquisitions with the most appropriate
sources of capital, which may include undistributed Funds from Operations, the
issuance of equity securities including through the operation of any dividend
reinvestment plan adopted by the Company, the sale of assets, bank and other
institutional borrowings and the issuance of debt securities.

The Company does not have a policy limiting the number or amount of
mortgages that may be placed on any particular property, but mortgage financing
instruments may, and usually do, limit additional indebtedness on such
properties.

A chart showing the debt of the Company is set forth above in "--Debt
Summary". During the past three years, the Company has engaged in the following
borrowing transactions. In September 1996 and February 1997, the Company
increased its mortgage loan with Prudential by $15.0 million, bringing the total
mortgage financing with Prudential to $354.0 million. This additional loan was
used to finance the expansion of Mid Rivers Mall. The original loan was part of
the acquisition financing for the purchase of the Company by Westfield Holdings
and other investors in February 1994. In July 1996, WPI extended its mortgage
loan facilities aggregating $146.8 million with National Australia Bank Limited.
These loans are secured by separate first mortgages on South Shore Mall and
Connecticut Post Mall. On August 7, 1996, the Company closed the refinance of an
existing Mello-Roos tax bond financing which were secured by taxes levied on The
Plaza at West Covina. The refinanced bonds totaled $51.2 million.

In December 1995, the Company entered into a $100.0 million unsecured
revolving credit/secured project loan with Bank of America National Trust and
Savings Association, Wells Fargo Bank, N.A., Dresdner Bank AG, and Fleet
National Bank. Portions of this loan were used to refinance a prior secured
revolving credit facility from The Boatmen's National Bank and Trust Company, to
finance the redevelopment of Eastland Center and for other corporate purposes.
As a result of the Company's election to convert a portion of such facility into
a $34.5 million secured project loan on Eastland Center, the unsecured revolving
credit facility is currently $50.0 million. On August 25, 1995, the Company
entered into a $48.0 million secured project loan with Bank of America National
Trust and Savings Association relating to the redevelopment of Mission Valley
Center. In March 1994, Meriden Square Partnership, a Joint Venture in which the
Company has a 50% interest, borrowed $50.0 million from Hypo Bank secured by a
first mortgage on Meriden Square.

EQUITY CAPITAL

The Board of Directors has the authority, without shareholder approval, to
issue additional shares of Common Stock and Preferred Stock or otherwise raise
capital, including through the issuance of senior securities, in any manner (and
on such terms and for such consideration) it deems appropriate, including in
exchange for property. Existing shareholders will have no preemptive right to
shares of Common Stock or other shares of capital stock issued in any offering,
and any such offering might cause a dilution of a shareholder's investment in
the Company. In 1995, the Company issued 105 shares of Senior Preferred Shares
at a purchase price of $500 per share. In connection with the Recapitalization,
the Company issued $94.0 million of Series A Preferred Shares. Simultaneously
with the closing of the Offerings, the Company expects to issue $27.0 million of
Series B Preferred Shares to ABP. Although it has no current plans to do so, the
Company may in the future issue securities in connection with acquisitions.

WORKING CAPITAL RESERVES

The Company will maintain working capital reserves (and when not sufficient,
access to borrowings) in amounts that the Board of Directors determines to be
adequate to meet normal contingencies in connection with the operation of the
Company's business and investments. Under an Unsecured Revolving Credit/Secured
Project Loan Agreement, dated December 19, 1995, between the Company, certain
banks and the Bank of America National Trust and Savings Association, as Agent,
the Company has been provided with a loan facility of up to $100.0 million,
which may be drawn as either secured or unsecured

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loans. The agreement currently provides the Company with an unsecured revolving
working capital facility of up to $50.0 million for general corporate purposes.
The agreement also provides the Company with a secured facility in an amount up
to $70.0 million for the rehabilitation of Eastland Center and Enfield Square
(if the remaining $35.5 million is borrowed in connection with Enfield Square,
the working capital facility will be reduced to $30.0 million). The revolving
facility is secured by negative pledges on Eagle Rock Plaza, Westland Towne
Center, Eastland Center and Enfield Square. In 1996, the Company elected to
obtain a project loan of $34.5 million in connection with the redevelopment of
Eastland Center. This project loan is secured by a Deed of Trust on Eastland
Center. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations--Liquidity and Capital Resources."

ANNUAL REPORTS

Over the last three years, the Company has not issued annual reports to
shareholders. Following the Offerings, the Company will make annual reports, and
other reports to shareholders, as required by the United States securities laws
and New York Stock Exchange rules, and will include financial statements
certified by independent public accountants.

OTHER POLICIES

The Company may, under certain circumstances, purchase shares of Common
Stock in the open
market or in private transactions with its shareholders, if such purchases are
approved by the Board of Directors. The Board of Directors has no present
intention of causing the Company to repurchase any such shares (other than the
Senior Preferred Shares), and any such action would only be taken in conformity
with applicable Federal and state laws and the applicable requirements for
qualifying as a REIT. As part of the Recapitalization, the Company repurchased
21,767,645 shares of Common Stock held by investors other than Westfield
Holdings and its affiliates.

The Company has adopted certain policies to reduce or eliminate potential
conflicts of interest. Following consummation of the Offerings, any transaction
between the Company and Westfield Holdings (including the decision by the
Company to proceed with any development project, the fixed price or construction
schedule for any development project, but excluding decisions relating to the
operation of the Properties in the ordinary course of business) must be approved
by at least 75% of the Independent Directors except that all decisions relating
to the exercise of any rights under the Garden State Plaza Loan or the exercise
of the Westfield Holdings Warrants must be approved by only a majority of the
Independent Directors. Any decision to terminate the Management Agreements, the
Advisory Agreement or the Master Development Framework Agreement, as well as any
decision to exercise the Garden State Plaza Option, must be approved by at least
75% of the Independent Directors and, so long as WAT owns at least 10% of the
outstanding capital stock of the Company, the WAT Trustee. See "Management,
Advisory and Development Services to the Company." Except as set forth above and
the other transactions described herein between the Company and such parties,
any transaction between the Company and any officer or director or principal
shareholder (including any loan to or borrowing from any such officer, director
or principal shareholder or any acquisition of assets or other property from or
sale of assets or other property to any such officer, director or principal
shareholder) must be approved by a majority of the disinterested directors.

The Company's policies with respect to all activities described may be
reviewed and modified from time to time by the Board of Directors without the
vote of the shareholders and the Board of Directors may, without the approval of
shareholders, alter the Company's investment, acquisition, financing and other
policies if it determines in the future that such a change is in the best
interests of the Company and its shareholders.

At all times, however, the Company intends to make investments in such a
manner as to be consistent with the requirements of the Code to qualify as a
REIT unless, because of circumstances or changes in the Code (or in the Treasury
Regulations), the Board of Directors, with the consent of holders of a majority
of each of the Common Stock and the Series A Preferred Shares and Series B
Preferred Shares, voting as a single class, determines to revoke the Company's
REIT election.

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MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

Following the completion of the Offerings, the Board of Directors will be
comprised of ten directors, six of whom will be Independent Directors, and two
associate directors. Associate directors of the Company will attend meetings of
the Board but will not vote on matters before the Board.

The Board of Directors is responsible for the general policies of the
Company and the general supervision of the Company's activities conducted by its
officers, agents, advisors, managers or independent contractors, including the
Advisor, Manager and Developer, as may be necessary in the course of the
Company's business.

The directors and executive officers of the Company are as set forth below:

<TABLE>
<CAPTION>
NAME AGE TITLE
- ------------------------------ --- -------------------------------------------------------
<S> <C> <C>
Frank P. Lowy................. 66 Director and Chairman of the Board
Roy L. Furman................. 57 Director
Frederick G. Hilmer........... 52 Director
David H. Lowy................. 42 Director
Herman Huizinga............... 63 Director
Larry A. Silverstein.......... 66 Director
Francis T. Vincent, Jr........ 59 Director
George Weissman............... 78 Director
Peter S. Lowy................. 38 Director and Co-President
Richard E. Green.............. 54 Associate Director and Co-President
Stephen P. Johns.............. 49 Associate Director
Robert P. Bermingham.......... 52 General Counsel and Secretary
Roger D. Burghdorf............ 49 Executive Vice President
Mark A. Stefanek.............. 43 Chief Financial Officer and Treasurer
Randall J. Smith.............. 47 Executive Vice President
Dimitri Vazelakis............. 43 Executive Vice President
</TABLE>

An additional Independent Director will be elected within 90 days following
completion of the Offerings.

BIOGRAPHIES OF DIRECTORS AND EXECUTIVE OFFICERS

FRANK P. LOWY

Frank P. Lowy was appointed director of the Company in 1994. Frank P. Lowy
has been Chairman of the Company since 1994. He is Chairman of the Board of
Directors and co-founder of Westfield Holdings Limited. He is a Member of the
Board of the Reserve Bank of Australia, former President of the Board of
Trustees of the Art Gallery of New South Wales and a Director of the Daily Mail
and General Trust plc (U.K.). Frank P. Lowy is the father of David H. Lowy and
Peter S. Lowy. In 1993, Frank P. Lowy was acknowledged as one of six "pioneers"
of the shopping center industry worldwide by the ICSC.

ROY L. FURMAN

Roy L. Furman was appointed director of the Company in 1996. Mr. Furman is
vice chairman of Furman Selz, which he co-founded in 1973. He oversees the
Investment Banking Division of Furman Selz and has extensive experience in the
media and communications industry. Mr. Furman currently serves as a Vice
Chairman of Lincoln Center for the Performing Arts, Chairman of The Film Society
of Lincoln Center, and Vice President of the New York City Opera. Mr. Furman is
a graduate of Brooklyn College and Harvard Law School.

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FREDERICK G. HILMER

Frederick G. Hilmer was appointed director of the Company in 1996. Professor
Frederick Hilmer was appointed a director of Westfield Holdings in 1991. He
holds a degree in Law from the University of Sydney, a Master in Law from the
University of Pennsylvania and an MBA from the Wharton School of Finance. Since
1989 he has been Professor of Management at the Australian Graduate School of
Management. Prior to that he spent 19 years with McKinsey & Co., including three
years in the United States where he consulted to various retailers and nine
years as head of McKinsey & Co.'s Australian practice and was Chairman of the
National Competition Policy Review conducted on behalf of the Commonwealth
Government of Australia in 1993. He is a director of Fosters Brewing Group, Port
Jackson Partners Limited and Chairman of Pacific Power.

DAVID H. LOWY

David H. Lowy was appointed director of the Company in 1996. David H. Lowy
joined Westfield Holdings Limited in 1977, was appointed Managing Director of
Westfield Holdings Limited in 1987, and a director of Westfield Holdings Limited
in 1982. He worked for Westfield Holdings in the United States from 1977 to
1981. He holds a Bachelor of Commerce degree from the University of NSW. He is a
member of the Business Council of Australia, a member of the Royal Alexandra
Children's Hospital Fund Executive Committee and a Founding Governor and
Director of Air Services Australia Limited and the Australian Naval Aviation
Museum. David H. Lowy is a son of Frank P. Lowy and a brother of Peter S. Lowy.

HERMAN HUIZINGA

Herman Huizinga was appointed a director of the Company in May 1997. Mr.
Huizinga until recently was a member of the Executive Board of ING Group, the
major international banking and insurance group, headquartered in the
Netherlands. He is a former Executive Director of Mercantile Mutual (Group) of
Australia, (a subsidiary of ING) and was also a member of the Executive Board of
Nationale-Nederlanden, Chairman of "Mandeville" (Erasmus University Award
Committee), a member of the Board of Club Rotterdam (Chairman 1995-1996),
Rotterdam Morgen (Vice Chairman 1995-1997), and he was a member of the Committee
Financing Infrastructure (ORI, which advised the Netherlands Government in
1996). He has recently been appointed as a member of the Board of Industrial
Tunnel Methology in Rotterdam.

LARRY A. SILVERSTEIN

Larry A. Silverstein was appointed a director of the Company in May 1997.
Larry A. Silverstein is President of Silverstein Properties, Inc., a
Manhattan-based real estate investment and development firm which owns interests
and operates over 10 million square feet of office space. Mr. Silverstein is a
member of the New York Bar, and governor of the Real Estate Board of New York,
having served as its Chairman. He is a trustee of New York University and is the
founder and Chairman Emeritus of the New York University Real Estate Institute.
He is Chairman of the Realty Foundation, Vice Chairman of the South Street
Seaport Museum, and board member of the Museum of Jewish Heritage.

FRANCIS T. VINCENT, JR.

Francis T. Vincent, Jr. was appointed a director of the Company in May 1997.
Francis T. Vincent, Jr. served as the eighth Commissioner of Major League
Baseball from September 13, 1989 to September 7, 1992. Prior to 1992, Mr.
Vincent was President and Chief Executive Officer of Columbia Pictures
Industries, Inc., Chairman and CEO of Coca Cola Company Entertainment Business
Sector and Executive Vice President of the Coca-Cola Company. Mr. Vincent also
served as Associate Director of the Division of Corporation Finance of the U.S.
Securities and Exchange Commission. Mr. Vincent received his law degree from
Yale Law School in 1963 and is a member of the Bar in New York, Connecticut and
the

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District of Columbia. Mr. Vincent is a member of the Board of Directors of Time
Warner, Inc., Culbro Corporation, Horizon and Oakwood Homes Corporation.

GEORGE WEISSMAN

George Weissman was appointed a director of the Company in May 1997. George
Weissman served as Chairman and Chief Executive Officer of Philip Morris
Companies Inc. from November 1978 until his retirement in July 1984. From March
1984 to 1994, he was a member of the Board of Directors of Paramount
Communications, Inc. From 1973 to 1994, he was on the Board of Directors of
Avnet, Inc. He also served on the Board of Directors of Chemical Bank from 1978
to 1990. Mr. Weissman was formerly a member of the Council of the Brookings
Institute, the Board of Trustees of the Committee for Economic Development
(CED), and The Business Roundtable. From 1980 to 1987, Mr. Weissman was a
director of the New York Chamber of Commerce and Industry, and a member of the
Policy Committee of the New York City Partnership. From 1986 to 1994, Mr.
Weissman served as Chairman of the Board of Directors of Lincoln Center for the
Performing Arts, Inc. From 1979 to 1990, he served as a Trustee of the Whitney
Museum of American Art.

PETER S. LOWY

Peter S. Lowy was appointed director of the Company in 1994. Peter S. Lowy
was an Executive Vice President of the Company from 1994 until March 1997 and is
currently a co-President of the Company. He has been responsible for Westfield
Holdings's U.S. operations since 1990 after nearly a decade with Westfield
Holdings and its affiliates in Sydney. He was appointed a director of Westfield
Holdings Limited in 1987 and a managing director in 1997. Prior to joining
Westfield Holdings, he worked in investment banking in New York and London. He
holds a Bachelor of Commerce degree from the University of NSW. Peter S. Lowy is
a son of Frank P. Lowy and a brother of David H. Lowy.

RICHARD E. GREEN

Richard E. Green was appointed an associate director of the Company in May
1997. Mr. Green served as a director from 1996 to May 1997. He has been
President of the Company since 1994. He has held the position of President of
Westfield Holdings's U.S. operations from 1980 to 1988 and from 1993 to today.
In the interval from 1988 until 1993, he served as President of the entity
acquired in the Recapitalization. See "Certain Transactions." From 1968 to 1980
he was employed by the Company which was then owned by the May Company, and
obtained the title of Executive Vice President. He is a Past Trustee of the
ICSC. Richard E. Green holds a Bachelor of Accounting and Finance from San Jose
State University.

STEPHEN P. JOHNS

Stephen P. Johns was appointed an associate director in May 1997. Stephen P.
Johns is a director of Westfield Holdings Limited. Mr. Johns joined Westfield
Holdings Limited in 1970 and was appointed Secretary and subsequently General
Manager, Finance, prior to becoming Finance Director in 1985. In 1997, Mr. Johns
was appointed Group Finance Director for Westfield Holdings Limited and its
subsidiaries. Mr. Johns holds a Bachelor of Economic degree from the University
of Sydney and is an Associate of the Institute of Chartered Accountants in
Australia.

ROBERT P. BERMINGHAM

Robert P. Bermingham was appointed as General Counsel, a Senior Vice
President and Secretary of the Company in February 1995 and is currently General
Counsel and Secretary of the Company. He joined Westfield Holdings's U.S.
operations to take responsibility for all legal functions relating to the
Company and the Developer. Robert P. Bermingham holds a B.A. in English from the
University of Southern California and a J.D. from Loyola Law School. Between
1993 and 1994, he was Vice President, General

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Counsel and Secretary of Food 4 Less/Alpha Beta Corporation. Prior to that, Mr.
Bermingham was in private legal practice in Los Angeles.

ROGER D. BURGHDORF
Roger D. Burghdorf was appointed a Senior Executive Vice President of
Leasing and Center Management of the Company in 1994 and became an Executive
Vice President of the Company in 1997. Prior to joining Westfield Holdings in
1995, Roger D. Burghdorf was, for five years, the director of leasing at the
Company. He is responsible for all leasing and management services for the
Centers throughout the United States.

RANDALL J. SMITH

Randall Smith is an Executive Vice President of the Company. With over 20
years of experience in the field, Mr. Smith was with May Centers, Inc., the
Company's predecessor, for nine years, before joining Westfield Holdings in
1995. Mr. Smith has a Bachelor of Arts in Art and Architecture and a Master in
Business Administration in Marketing from Miami University. He is a member of
the ICSC's Research Advisory Task Force.

MARK A. STEFANEK

Mark Stefanek was appointed Treasurer of the Company in 1994 and became
Chief Financial Officer in 1997. Mark Stefanek has extensive experience in real
estate finance and development. He began his career at Arthur Andersen. He holds
a Bachelor of Business Administration-Accounting from the University of Notre
Dame and is a certified public accountant. From 1985 to 1991 he was Chief
Financial Officer of Western Development Corporation and for three years before
that he was with Cadillac Fairview Urban Development, Inc. From 1991 to 1994 he
served as Vice President, Finance and Administration for Disney Development
Company.

DIMITRI VAZELAKIS

Dimitri Vazelakis was appointed a Senior Executive Vice President of the
Company in 1994 and is currently an Executive Vice President of the Company. He
holds a Bachelor of Science in Civil Engineering and a Masters in Business
Administration and Finance from New South Wales Institute of Technology. Dimitri
Vazelakis joined Westfield Holdings Limited in 1972, came to Westfield
Holdings's U.S. operations in 1986 and in 1989 he began heading activities in
development, design and construction activities. Between 1979 and 1986, he
worked with Westfield Holdings in Australia, obtaining the position of Deputy
General Manager of Design and Construction.

CERTAIN INFORMATION REGARDING THE BOARD OF DIRECTORS

The Board of Directors expects to hold meetings at least quarterly, and it
may take action on behalf of the Company without a meeting by unanimous written
consent. Directors may participate in meetings by means of telephone conference
calls or other telecommunications equipment.

Upon consummation of the Offerings, the Board of Directors will be divided
into three classes of directors. The terms of the classes will expire in 1998,
1999, and 2000 respectively. Beginning in 1998, as the term of each class
expires, directors for that class will be elected for a three-year term and the
directors for the other two classes will continue in office.

COMMITTEES OF THE BOARD OF DIRECTORS

EXECUTIVE COMMITTEE. The Executive Committee has such authority as is
delegated by the Board of Directors, including authority to execute certain
contracts and agreements with unaffiliated parties. The Executive Committee will
consist of three members, at least one of whom is an Independent Director.

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AUDIT COMMITTEE. The Audit Committee consists of three Independent
Directors. It makes recommendations concerning the engagement of independent
public accountants, reviews with the independent public accountants the plans
and results of the audit engagement, approves professional services provided by
the independent public accountants, reviews the independence of the independent
public accountants, considers the range of audit and non-audit fees and reviews
the adequacy of the Company's internal accounting controls. The current members
of the Audit Committee are Messrs. Herman Huizinga, Francis Vincent and George
Weissman.

NOMINATING COMMITTEE. The Nominating Committee consists of the Chairman and
two Independent Directors. It shall make recommendations to the Board of
Directors for the election of directors of the Company. The current members of
the Nominating Committee are Messrs. Frank Lowy, Roy Furman and Larry
Silverstein.

SPECIAL POWERS OF THE INDEPENDENT DIRECTORS. In addition to the review and
approval of transactions in which Westfield Holdings has a material interest,
the Independent Directors will retain certain special powers with respect to the
Company's relationship with the Manager, Advisor and Developer. Upon
consummation of the Offerings, by the agreement of the WAT Trustee (so long as
it owns at least 10% of the outstanding capital stock of the Company) and at
least 75% of the Independent Directors, the Company may terminate the Advisory
and Management Agreements upon certain, specific determinations after the
initial three-year term, and thereafter on an annual basis. The Master
Development Framework Agreement may be terminated by the vote of the WAT Trustee
and at least 75% of the Independent Directors if the Advisory and Management
Agreements have been terminated. In addition, upon consummation of the
Offerings, the decision for the Company to proceed with a development project
and the fixed price or construction schedule for any development project will
require approval of at least 75% of the Independent Directors. The exercise of
the Garden State Plaza Option will require the approval of at least 75% of the
Independent Directors. All decisions relating to the exercise of any rights
under the Garden State Plaza Loan or the exercise of the Westfield Holdings
Warrants shall require the approval of at least a majority of the Independent
Directors.

COMPENSATION OF DIRECTORS

Each Independent Director will receive from the Company an annual fee of
$40,000, payable one-half in cash and one-half in Common Stock and reimbursement
of expenses incurred in attending meetings and as a result of other work
performed for the Company.

EXECUTIVE COMPENSATION

The Company has no employees and none of the executive officers named above
receive any compensation for services rendered to the Company. The Company does
not have any other retirement, incentive, bonus, stock based or other employee
benefit plans. All of the Company's executive officers are compensated by
Westfield Holdings. See "Advisory, Management and Development Services to the
Company."

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ADVISORY, MANAGEMENT AND
DEVELOPMENT SERVICES TO THE COMPANY

The Company has no employees and relies on Westfield Holdings for the
management of the Company and the Properties. These services are provided under
a series of agreements between the Company and subsidiaries of Westfield
Holdings. For a description of Westfield Holdings, see "The Company--Westfield
Holdings."

The Board of Directors monitors the performance under the advisory,
management and development agreements with Westfield Holdings. Such financial
arrangements and any other transactions in which Westfield Holdings has a
material interest must be approved by the Independent Directors and, in certain
instances, WAT. The Independent Directors may seek the advice of independent
experts in carrying out their duties.

The agreements were negotiated by the Company and Westfield Holdings. The
Company believes that, although these agreements were negotiated between
associated parties, they reflect market terms. The following summaries of
certain provisions of the advisory, management and development agreements do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all of the provisions of such agreements, copies of which are
exhibits to the Registration Statement of which this Prospectus is a part. See
"Additional Information."

THE ADVISOR AND THE ADVISORY AGREEMENT

The Advisor, Westfield U.S. Advisory, L.P., a Delaware limited partnership
wholly-owned by Westfield Corporation, Inc., a subsidiary of Westfield Holdings
Limited, provides a variety of asset management and investment services for the
Company. These services include (i) preparation of an annual strategic plan,
including: a specific business strategy, annual operating budget, investment and
disposition objectives, capitalization and funding strategies, (ii) coordination
of asset management in connection with the Manager and the Developer, (iii)
general administrative duties for the Company and the Centers, including:
financial reporting, shareholder relations, property accounting, (iv) real
estate investment advice, (v) the investment and reinvestment of any moneys and
securities of the Company in short-term investments and (vi) maintenance of the
Company books and preparation of financial reports.

Under an advisory agreement, dated as of July 1, 1996, as amended (the
"Advisory Agreement"), the Advisor receives an annual fee determined as follows.
The annual advisory fee shall be equal to 25% of the annual Funds From
Operations in excess of the "Advisory FFO Amount", but shall not exceed 55 basis
points on the "Net Equity Value" of the Company's assets. As of the date of and
after giving effect to the Offerings and concurrent transactions, the "Advisory
FFO Amount" will equal $111.5 million. The "Advisory FFO Amount" shall
thereafter be increased as set forth below whenever the Company issues
additional Common Stock (the "New Issuance"), as follows. The Advisory FFO
Amount shall be the sum of the then applicable Advisory FFO Amount and the "FFO
Adjustment Factor." The "FFO Adjustment Factor" is equal to 103% (except that
100% shall be used with respect to Common Stock issued under any distribution
reinvestment plan adopted by the Company) multiplied by (a) a fraction the
numerator of which is the aggregate "Funds From Operations Available for Common
Stock" of the Company for each of the four full calendar quarters immediately
preceding the date of the New Issuance and the denominator of which is the
aggregate number of shares of Common Stock (on a fully diluted basis as required
by GAAP) of the Company then outstanding immediately prior to the date of the
New Issuance multiplied by (b) the number of shares of Common Stock issued in
the New Issuance (on a fully diluted basis as required by GAAP). "Funds From
Operations Available for Common Stock" means Funds from Operations less
dividends paid or accrued on the preferred shares during the applicable four
full calendar quarter period. The advisory fee shall be paid quarterly on the
last business day of each calendar quarter based on the annual budget for Funds
from Operations for the Company and shall be subject to year end adjustment
based on actual Funds From Operations Available for Common Stock for the year.
The advisory fee is not payable for the period through December 31, 1997. "Net
Equity Value" will be based on shareholders' equity as reflected in the
Company's most recent quarterly financial statements, as adjusted to reflect the

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most recent appraised value of the Properties (which appraisals will be
performed on a rolling three year basis).

Upon consummation of the Offerings, the Advisory Agreement will be amended
to have an initial term of three years commencing on the consummation of the
Offerings and will automatically be renewed for additional one-year terms. After
the initial three-year term, the Advisor's performance will be reviewed annually
and the Advisory Agreement may be terminated annually upon the agreement of the
WAT Trustee (so long as it owns at least 10% of the outstanding capital stock to
the Company) and at least 75% of the Independent Directors based on
unsatisfactory performance that is materially detrimental to the Company or if
the compensation payable to the Advisor is not fair, subject to the Advisor's
right to prevent a compensation termination by accepting a mutually acceptable
reduction of its fees. In addition, the Advisory Agreement may be terminated at
any time, for cause, which is defined as fraud, misappropriation of funds or
willful violation of the Advisory Agreement or if an event of default has
occurred and is continuing under the Garden State Plaza Loan.

The Advisor can terminate the Advisory Agreement if the Advisor notifies the
Company that advisory services shall cease to be one of the major business
undertakings of Westfield Holdings in the United States, except that the
Advisory Agreement will continue for a period of 180 days thereafter so long as
the Company is reasonably satisfied with the Advisor's ability to provide the
required services during such period.

The principal executive officers of the general partner of the Advisor are
Richard E. Green and Peter S. Lowy, both of whom are co-Presidents of the
Company. For at least the last five years Richard E. Green has worked for
Westfield Holdings or the entity acquired in the Recapitalization. Peter S. Lowy
has worked for Westfield Holdings for at least the last five years. The Advisor
is located at 11601 Wilshire Boulevard, 12th Floor, Los Angeles, California
90025.

THE MANAGER AND THE MANAGEMENT AGREEMENTS

The Manager, CenterMark Management Company, a Delaware partnership
wholly-owned by Westfield Holdings Limited, manages the Properties (other than
North County Fair). Under separate management agreements (each individually a
"Management Agreement" and collectively the "Management Agreements"), the
Manager has managed each wholly-owned Center in the Company's portfolio and the
Centers owned by the Joint Ventures for which the Company has management
responsibility, since January 1995. Prior to January 1995, Westfield Holdings
provided management services to the Company from and after its acquisition by
Westfield Holdings and others in February 1994. The Manager provides management
and leasing services including, among other duties, (i) paying expenses of the
Center to the extent that the Company has provided the funds, (ii) negotiating,
administering and enforcing leases, (iii) administering and enforcing service,
maintenance and other agreements made by or on behalf of the Company or Center,
(iv) employing, paying and supervising the employees necessary to operate and
maintain the Center, (v) cleaning, maintaining, servicing and repairing the
Center, (vi) notifying the Company of any tax assessments, reassessments or
other impositions and handling any relevant appeals at the request and cost of
the Company, (vii) formulating and implementing an insurance plan, (viii)
locating and endeavoring to secure suitable tenants, and (ix) performing other
activities necessary for running a Center. For each of the wholly-owned Centers,
the Manager receives a property management fee from the Company equal to 5% of
all minimum, fixed and percentage rents payable with respect to the wholly-owned
Centers, a lease preparation fee of $750 per lease, and a tenant plan review fee
of $1,000 per tenant. The property management fee payable by the Company to the
Manager for the wholly-owned Centers is identical to the fee paid by the Company
to Westfield Holdings prior to the Recapitalization. For the Joint Venture
properties managed by the Manager, the fees payable to the Manager are based on
the terms of the Joint Venture agreements but the Company's share thereof is
subject to adjustment so that the aggregate fees payable by the Company with
respect to such properties are the same as payable with respect to the
wholly-owned Centers. Fees paid for the year ended December 31, 1996 to the
Manager under these agreements totaled $5.2 million, including $1.7 million of
which was capitalized.

Upon consummation of the Offerings, each Management Agreement will be
amended to have an initial three-year term commencing upon the consummation of
the Offerings followed by automatic one-

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year renewals. After the initial three-year term, the Manager's performance will
be reviewed annually and the Management Agreements may be terminated annually
upon the agreement of the WAT Trustee (so long as it owns at least 10% of the
outstanding capital stock of the Company) and at least 75% of the Independent
Directors based on unsatisfactory performance that is materially detrimental to
the Company or if the compensation to the Manager is not fair, subject to the
Manager's right to prevent a compensation termination by accepting a mutually
acceptable reduction of its fees. In addition, each of the Management Agreements
may be terminated at any time for cause, which is defined as fraud,
misappropriation of funds or willful violation of the respective Management
Agreements or if an event of default has occurred and is continuing under the
Garden State Plaza Loan.

Pursuant to a separate letter agreement, the Company and Manager have also
agreed that so long as the Manager is managing the Centers under the Management
Agreements, the Manager will manage all wholly-owned properties acquired by the
Company in the future and that the Company will use its reasonable efforts to
have the Manager appointed as the manager with respect to any future joint
venture properties controlled by the Company.

The Manager can terminate the Management Agreements if the Manager notifies
the Company that management of regional shopping centers shall cease to be one
of the principal business undertakings of Westfield Holdings Limited in the
United States, except that the Management Agreements will continue for a period
of 180 days thereafter so long as the Company is reasonably satisfied with the
Manager's ability to provide the required services during such period.

The principal executive officers of the general partner of the Manager are
Richard E. Green and Peter S. Lowy, both of whom are co-Presidents of the
Company. For at least the last five years Richard E. Green has worked for
Westfield Holdings or the entity acquired in the Recapitalization. Peter S. Lowy
has worked for Westfield Holdings for at least the last five years. The Manager
is located at 11601 Wilshire Boulevard, 12th Floor, Los Angeles, California
90025.

THE DEVELOPER AND THE DEVELOPMENT AGREEMENT

The Developer, Westfield Corporation, Inc., a Delaware corporation
wholly-owned by Westfield Holdings Limited, carries out planning and
pre-development work to determine feasible and economically viable developments
of properties within the Company's portfolio. Under the Master Development
Framework Agreement, dated July 1, 1996, the Developer is reimbursed for costs,
subject to the work being performed in accordance with an annual plan or
redevelopment budget previously approved by the Board of Directors. If the
Company in its sole discretion (based on feasibility and other appropriate
studies) decides to proceed with a particular development, the Developer
provides the necessary development services pursuant to a separate Development
Agreement to be entered into by the parties. The Developer provides (i) such
development services for a fixed fee equal to 5% of the final gross project
price, (ii) architectural, design and engineering services for a fixed fee equal
to 10% of the construction costs and (iii) other related services in
consideration of agreed fees. The construction portion of the development
project is performed on a fixed price basis. The Master Development Framework
Agreement provides that the Company may engage an independent representative to
advise the Company with respect to the proposed fixed price and the construction
schedule. If the Company desires to engage such an independent representative,
the Company shall consult with Westfield Holdings in good faith as to the
selection of the independent representative. If the Company and the Developer
cannot agree as to the fixed price or the construction schedule for the project,
and the parties' respective independent representatives cannot negotiate a
resolution, an independent expert will determine the appropriate price and
construction schedule. The Developer may then either accept the independent
expert's proposal or agree to perform the work on a "cost plus" basis in which
case the Developer will (i) be paid for the actual cost of performing the
services plus a percentage of those costs as agreed between the Company and the
Developer and (ii) the Company may designate the schedule, but the Developer
will not be liable if the construction schedule is not achieved. The Company has
no obligation to proceed with any development project. The decisions to proceed
with a development project and the fixed price and construction schedule with
respect thereto requires the approval of at least 75% of the Independent
Directors. Fees paid and capitalized for the year ended December 31, 1996 to the
Developer under these agreements totaled $2.7 million.

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Upon consummation of the Offerings, the Master Development Framework
Agreement will be amended to provide that it may be terminated by the Company by
agreement of at least 75% of the Independent Directors and the WAT Trustee (so
long as it owns at least 10% of the outstanding capital stock of the Company) if
the Advisory Agreement and the Management Agreements have been terminated in
accordance with their terms. In such event, the Developer and the Company will
remain bound by the Master Development Framework Agreement for the remaining
term with respect to any development projects for which the Developer has
commenced to provide substantial predevelopment services to the Company. In
addition, the Master Development Framework Agreement may be terminated at any
time for cause, which is defined as fraud, misappropriation of funds or willful
violation of the Master Development Framework Agreement. Similarly, any
Development Agreement may be terminated for cause, which is defined as fraud,
misappropriation of funds or willful violation of the Development Agreement or
if an event of default has occurred and is continuing under the Garden State
Plaza Loan.

The Developer can terminate the Master Development Framework Agreement if
the Developer notifies the Company that property development services shall
cease to be one of the principal business undertakings of Westfield Holdings
Limited in the United States, except that the Master Development Framework
Agreement will continue for a period of 180 days thereafter so long as the
Company is reasonably satisfied with the Developer's ability to provide the
required services during such period and except that any such termination shall
not affect any Development Agreement previously entered into by the Developer
and the Company.

The principal executive officers of the Developer are Richard E. Green and
Peter S. Lowy, both of whom are co-Presidents of the Company. For the last five
years Richard E. Green has worked for Westfield Holdings or the entity acquired
in the Recapitalization. Peter S. Lowy has worked for Westfield Holdings for at
least the last five years. The Developer is located at 11601 Wilshire Boulevard,
12th Floor, Los Angeles, California 90025.

WESTFIELD HOLDINGS MANAGEMENT

All of the officers of the Company are employed by Westfield Holdings and
receive compensation and fringe benefits from such entities and not from the
Company. Several of the officers serve as directors of Westfield Holdings
Limited and certain of such officers and associates beneficially own shares of
Westfield Holdings and units of WAT. See "Principal Shareholders." As a result
of such employment and interests, the officers of the Company receive an
indirect benefit from the advisory, management and development arrangements
described above.

CERTAIN TRANSACTIONS

RELATIONSHIPS AND TRANSACTIONS WITH WESTFIELD HOLDINGS

SERVICES

Westfield Holdings provides advisory services to the Company and management
and development services to the Centers, for which it receives fees. All of the
officers of the Company and certain of its directors are officers and directors
of Westfield Holdings. The Company has no employees and relies solely on
Westfield Holdings for management services. As such, the Company is not
currently able to operate without Westfield Holdings. See "Advisory, Management
and Development Services to the Company." Westfield Holdings Limited is an
independent company from the Company, and except for the Company's interest in
the Westfield Holdings Warrants, the purchasers of the Shares will not acquire
any interest in Westfield Holdings Limited.

STOCK OWNERSHIP

In 1994, Westfield Holdings acquired a 40% interest in the Company from
Prudential. In 1995, Westfield Holdings purchased an additional 10% of the
Company from certain other investors. Westfield Holdings currently owns
10,930,672 shares of Common Stock. Westfield Holdings received in connection

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with the Recapitalization WAT ordinary options, which permit it to exchange each
share of Common Stock owned by Westfield Holdings for ordinary units of WAT. The
ordinary options will expire upon consummation of the Offerings. Westfield
Holdings has informed the Company that it does not intend to exercise such
options prior to the consummation of the Offerings. Westfield Holdings will
purchase 2,300,000 Shares at the price to public in the Offerings and may, from
time to time, purchase additional shares of Common Stock in the market or
otherwise. Westfield Holdings has certain demand registration rights for its
shares of Common Stock. The Company has been informed that none of the proceeds
of the Offerings will be used by the offerees to acquire the Common Stock under
the Orders. Westfield Holdings has advised the Company that it will utilize
currently available cash or credit facilities to acquire such Common Stock under
the Orders. Interests associated with the Lowy family and Richard Green have
also notified the Company that they will utilize currently available cash or
credit facilities to acquire such Common Stock. Merrill Lynch will fill the
Orders in their entirety. See "Shares Eligible for Future Sale-- Registration
Rights."

WPI ACQUISITION

In connection with the Recapitalization, the Company acquired from interests
associated with the Lowy family indirect ownership of three additional regional
shopping centers, Connecticut Post Mall, Trumbull Shopping Park and South Shore
Mall. The acquisition was made and the price was determined based on a due
diligence investigation, review of the books, records and properties and receipt
of an independent appraisal of the three Centers. The Company paid $62.8
million, after adjustments, plus the assumption of debt, as the purchase price
for the acquisition which closed on July 1, 1996. The sellers remain liable for
certain liabilities, including certain income taxes imposed on WPI and its
subsidiaries with respect to periods prior to the closing of the purchase.
Although there is no assurance that the continuing undertaking of the sellers
(including credit support for such indemnity of not less than $20 million) will
be adequate to discharge any such liabilities, the Company believes that no such
liability would be material to the Company. The Company believes that, although
this acquisition was negotiated between associated parties, it reflects market
terms.

GARDEN STATE PLAZA OPTION

In July 1996, the Company acquired from Westfield Holdings an option to
acquire at fair market value the stock of Westland Realty, Inc., the holder of
an indirect 50% interest in the Garden State Plaza located in Paramus, New
Jersey.

The Garden State Plaza Option is exercisable following the completion of an
independent valuation of the property to determine its fair market value.
Contemporaneously with the closing of the Offerings, the Garden State Plaza
Option will be amended to provide that the valuation procedure may be commenced
by the Company upon the earliest to occur of (x) any time after completion and
stabilization of the current expansion of the property, defined to mean the
leasing of 95% of the mall gross leasable area for the expansion, (y) any time
after the date which is 18 months after completion of the current expansion of
the property and (z) no later than January 3, 2000. The valuation is to be
performed by an independent appraiser approved by the Company and Westfield
Holdings within 30 days after the Company elects to commence the valuation
procedure. The purchase price under the Garden State Plaza Option is equal to
50% of such fair market valuation, subject to adjustment for the mortgage debt
of Garden State Plaza, the Garden State Plaza Loan and the amount by which
current assets exceed current liabilities. The Garden State Plaza Option must be
exercised within 120 days after delivery of the determination of the fair market
value of the property. The Company believes that the conditions to the exercise
of Garden State Plaza Option will first be satisfied in the summer of 1999 based
on the right to exercise 18 months after substantial completion; however, the
option may first be exercised at an earlier date if the property is 95% leased.
The Board of Directors (including at least 75% of the Independent Directors)
will determine whether the exercise of the Garden State Option is in the best
interests of the Company. In the event that the purchase price exceeds $55
million (net of the $145 million Garden State Plaza Loan), the exercise of the
Garden State Plaza Option will be subject to an affirmative vote of a majority
of the holders of

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<PAGE>
Common Stock voting at a meeting on such issue other than Westfield Holdings and
its affiliates (including, without limitation, WAT) and interests associated
with the Lowy family. The purchase price shall be payable by the delivery of
shares of Common Stock, valued at the average of the closing sale price for the
Common Stock on the 20 trading days prior to the date the option is exercised.

Although the Garden State Plaza Option is not currently exercisable, the
Company will acquire a substantial economic interest in the revenues to be
received from the Garden State Plaza by using a portion of the proceeds of the
Offerings and concurrent transactions to make a $145 million participating
secured loan to the subsidiaries of Westfield Holdings Limited which own the
indirect 50% interest in Garden State Plaza. The loan will bear interest at a
fixed annual rate of 8.5% per annum, will be secured by a pledge of Westfield
Holdings' 50% partnership interest in the limited partnership which owns Garden
State Plaza and will be on a nonrecourse basis. The Company will also receive
participating interest based on 80% of the borrowers' share of the adjusted cash
flow (after payment of the fixed interest and after calculating Westfield
Holdings's share of cash flow from Garden State Plaza as if the mortgage loan
encumbering such property had a fixed interest rate of 7.25% per annum) from
Garden State Plaza subject to an aggregate limit for fixed interest and
participating interest in an amount equal to 11% per annum. The Company has been
advised by Westfield Holdings that the loan proceeds are not expected to be
invested in Garden State Plaza. The loan will mature in 10 years, may be prepaid
with a yield maintenance premium (based on the payment of the maximum amount of
participating interest) after the expiration of the Garden State Plaza Option in
connection with the sale of Garden State Plaza (or Westfield Holdings' interest
therein) to an unaffiliated third party and may not otherwise be prepaid for
five years. If an event of default shall occur under the Garden State Plaza
Loan, the Company will be entitled to a yield maintenance premium (based on the
payment of the maximum amount of participating interest) and will have the right
to terminate the Management Agreements, the Advisory Agreement and the Master
Development Framework Agreement. Prior to the consummation of the Offerings, the
board of directors of Westfield Holdings will represent to the U.S.
Underwriters, the International Managers and the holders of the Shares that
Westfield Holdings will not prepay the Garden State Plaza Loan for seven years
except under the circumstances and with a yield maintenance premium as set forth
above.

The other 50% interest in Garden State Plaza is owned by affiliates of
Rodamco North America B.V., a Netherlands corporation.

WESTFIELD HOLDINGS WARRANTS

Contemporaneously with the Offerings, the Company will purchase from
Westfield Holdings Limited for an aggregate of $15.3 (equal to Aus.$19.6
million) the non-transferable Westfield Holdings Warrants to acquire 9.8 million
ordinary shares of Westfield Holdings Limited, which would as of the date hereof
equal approximately 9% of the ordinary shares of Westfield Holdings Limited
outstanding after the exercise of the options. The term of the Westfield
Holdings Warrants is five years but will be seven years if Australian law is
changed to permit such longer term. The Westfield Holdings Warrants may be
exercised in whole or in part following the third anniversary of the grant of
the Westfield Holdings Warrant. Each Westfield Holdings Warrant will have an
exercise price equal to the weighted average of the sale prices of ordinary
shares of Westfield Holdings Limited on the ASX for the 20 business days
immediately preceding the consummation of the Offerings, and, subject to certain
anti-dilution adjustments, will entitle the Company to receive one ordinary
share of Westfield Holdings Limited. In addition, the Company has the right to
exercise the option for no cash payment, in which event the Company would be
entitled to receive, at the option of Westfield Holdings Limited, either the
number of Westfield Holdings Limited ordinary shares equal in value to, or cash
in an amount equal to, the amount by which the market price of the ordinary
shares of Westfield Holdings Limited exceeds on that date the exercise price of
such Westfield Holdings Warrants. For these purposes, the market price of an
ordinary share of Westfield Holdings Limited will be equal to the weighted
average of the sale prices of such shares on the ASX for the 20 business days
immediately preceding the exercise date. On May 15, 1997 the closing sale price
on the ASX of the Westfield Holdings Limited ordinary shares was Aus.$23.00.

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<PAGE>
For a description of the Westfield Holdings Warrants, see "The
Company--Westfield Holdings." The Westfield Holdings Warrants were negotiated
between associated parties and there can be no assurance that either the price
or the terms of the Westfield Holdings Warrant are fair.

RELATIONSHIPS AND TRANSACTIONS WITH WAT

WAT is an Australian public property trust which was established pursuant to
a Trust Deed, dated March 28, 1996, as amended (the "Trust Deed"), to acquire a
majority interest in the Company. WAT is managed by Westfield America Management
Limited ("WAM"), a wholly-owned subsidiary of Westfield Holdings Limited. WAT
units are traded on the ASX.

The WAT Trustee is Perpetual Trustee Company Limited which is Australia's
largest independent trustee organization and has extensive experience in acting
as trustee of unit trusts, including listed property trusts. Although under the
Trust Deed, WAM and the WAT Trustee have the power to make other investments,
WAT has informed the Company that it presently intends only to invest in the
Company.

The WAT Trustee generally exercises all of the voting rights over the shares
of Common Stock held by WAT as directed by WAM, the manager of WAT, subject to
certain exceptions contained in the WAT Trust Deed and applicable Australian
law, including an exception under current Australian law in relation to the
designation and election of the directors of the Company as set forth below.
Subject to the foregoing, so long as Westfield Holdings owns shares of Common
Stock and WAT and Westfield Holdings together hold more than 50% of the Common
Stock of the Company, the WAT Trustee has the power to vote in its absolute
discretion the number of shares of Common Stock held by WAT equal to the
difference between the number of shares of Common Stock held by WAT and
Westfield Holdings and 50% of the shares of Common Stock. Any additional shares
held by WAT will be voted by the WAT Trustee as directed by WAM.

Under current Australian law, the WAT Trustee must solicit approval of the
WAT unitholders before voting in the election of directors with respect to
shares of other corporations held by WAT. For this purpose, a general meeting of
WAT unitholders must be convened with each WAT unitholder having one vote for
each unit held. The WAT Trustee votes all shares of Common Stock as a block in
the manner approved by a majority of the units voting on the matter at such
meeting of unitholders. The WAT Trustee will agree to call a meeting of WAT
unitholders to obtain approval for voting for the election of directors.

In July 1996, the Company sold WAT 19,631,543 shares of Common Stock and the
1996 WAT Warrant for cash consideration of $314.3 million and WAT's agreement to
issue certain ordinary options and special options to the Company or, at the
direction of the Company, to certain shareholders of the Company. As a result,
13,429,110 ordinary options were issued to the holders of Common Stock
(including 10,930,672 ordinary options issued to Westfield Holdings) and 940,000
special options were issued to the holder of Series A Preferred Shares (ABP).
Each ordinary option permits the holder to exchange one share of Common Stock
for ordinary units of WAT. Each special option permits the holder to purchase
124.92 ordinary units of WAT (subject to adjustment in certain events) for $100
or for one Series A Preferred Share. The ordinary options, which are currently
exercisable, will expire upon consummation of the Offerings. The Company
understands that one of its existing shareholders intends to exercise ordinary
options with respect to 1,623,985 shares of Common Stock and all ownership
calculations set forth herein assume that such ordinary options have been
exercised. The special options become exercisable on July 1, 1998 and expire on
July 1, 2011. Concurrently with the Offerings, WAT expects to sell to ABP
270,000 special options. Each such special option will permit the holder to
purchase 133.33 ordinary units of WAT (subject to adjustment in certain events)
for $100 or one Series B Preferred Share. The special options become exercisable
on May 21, 1999 and will expire on May 21, 2012. WAT has no right to cause the
exercise of the options. If ordinary options are exercised prior to the
consummation of the Offerings or special options are exercised with Series A
Preferred Shares, WAT's equity ownership of the Company will increase. There can
be no assurance that ordinary options will not be exercised prior to
consummation of the Offerings or that special options will not be exercised with
shares of Series A Preferred Shares or Series B Preferred Shares on or after
July 1, 1998 or May 21, 1999.

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<PAGE>
Under the 1996 WAT Warrant, WAT has the right to purchase at any time and
from time to time, in whole or in part, 6,246,096 shares of Common Stock at an
exercise price (as well as the sales price for the Common Stock sold to WAT) of
$16.01 per share, subject to adjustment in certain events. The exercise price
was determined based on the initial public offering price of the WAT units. The
1996 WAT Warrant will expire on July 1, 2016. In connection with the Offerings,
the Company will issue to WAT the 1997 WAT Warrant pursuant to which WAT will
have the right to purchase at any time and from time to time, in whole or in
part, 2,089,552 shares of Common Stock at an exercise price equal to the initial
public offering price for the Shares, subject to adjustment in certain events.
The 1997 WAT Warrant will expire on the twentieth anniversary of its issuance.
The sale price for the 1997 WAT Warrant will be $2.6 million. Westfield Holdings
Limited has a right of first refusal if WAT wishes to sell the WAT Warrants.

In January 1997, the Company sold to WAT 8,151,155 shares of Common Stock
for $130.5 million and repurchased the same number of shares from an existing
investor for the same amount.

Upon consummation of the Offerings, WAT will own 62.4% of the outstanding
Common Stock on a fully-diluted basis. WAT also has the right to acquire
6,246,096 shares of Common Stock upon the exercise of the 1996 WAT Warrant and
2,089,552 shares of Common Stock upon the exercise of the 1997 WAT Warrant. Upon
the consummation of the Offerings, Westfield Holdings will own an approximately
24% equity interest in WAT on a fully diluted basis.

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<PAGE>
PRINCIPAL SHAREHOLDERS

The following table sets forth information regarding the beneficial
ownership (as defined under Rule 13d-3 promulgated under the Securities Exchange
Act of 1934, as amended) of shares of Common Stock and WAT units by (1) each
person known by the Company to be the beneficial owner of more than a five
percent interest in the Company, (2) each director, (3) the Chief Executive
Officers of the Company and (4) the directors and executive officers of the
Company as a group. No executive officers of the Company other than the Chairman
and the co-Presidents beneficially own shares of Common Stock or WAT units.
Unless otherwise indicated in the footnotes, all of the interests are owned
directly, and the indicated person or entity has sole voting and investment
power.

<TABLE>
<CAPTION>
NUMBER OF PERCENT OF
SHARES OF PERCENT OF ALL SHARES PERCENT OF
COMMON ALL SHARES NUMBER OF OF COMMON ALL WAT PERCENT OF
STOCK OF COMMON SHARES OF STOCK UNITS ALL WAT UNITS
BENEFICIALLY STOCK COMMON STOCK BENEFICIALLY BENEFICIALLY BENEFICIALLY
OWNED BENEFICIALLY BENEFICIALLY OWNED NUMBER OF OWNED OWNED
PRIOR TO OWNED PRIOR OWNED SUBSEQUENT WAT UNITS PRIOR TO SUBSEQUENT
NAME AND ADDRESS OF THE TO THE SUBSEQUENT TO TO BENEFICIALLY THE TO
BENEFICIAL OWNER OFFERINGS OFFERINGS OFFERINGS OFFERINGS OWNED OFFERINGS(6) OFFERINGS(7)
- ------------------------- ----------- ------------ -------------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Perpetual Trustee Company
Limited,
as Trustee for Westfield
America Trust............ 45,740,221 77.3% 49,453,758 62.4% -- -- --
The National Manager (1) (1) (4) (4)
Property Trusts
Perpetual Trustees of
Australia Limited
Level 7
1 Castlereagh Street
Sydney, Australia
Westfield Holdings
Limited................. 56,670,893 95.8% 62,684,430 79.1% 234,228,709 29.7% 28.5%
Level 24 Westfield (2)(3) (2)(3) (2)(3)(9) (2)(3) (2)(3)
Towers
100 William Street
Sydney, NSW 2011
Australia
Frank P. Lowy............ 56,670,893 95.8% 63,284,430.... 79.8% 302,935,768 38.4% 36.8%
c/o Westfield Holdings (3) (3) (3)(9) (3) (3)(5) (3)(5) (3)(5)
Limited
Level 24 Westfield
Towers
100 William Street
Sydney, NSW 2011
Australia
David H. Lowy............ 56,670,893 95.8% 63,284,430 79.8% 301,805,268 38.2% 36.7%
c/o Westfield Holdings (3) (3) (3)(9) (3) (3)(5) (3)(5) (3)(5)
Limited
Level 24 Westfield
Towers
100 William Street
Sydney, NSW 2011
Australia
Peter S. Lowy............ 56,670,893 95.8% 63,284,430 79.8% 301,800,768 38.2% 36.7%
c/o Westfield America, (3) (3) (3)(9) (3) (3)(5) (3)(5) (3)(5)
Inc.
11601 Wilshire
Boulevard
Los Angeles, CA 90025
Roy L. Furman............ -- -- 30,000(8) * 250,000 * *
Frederick G. Hilmer...... -- -- 16,000(8) -- -- -- --
Larry A. Silverstein..... -- -- -- -- -- -- --
Francis T. Vincent,
Jr...................... -- -- 10,000(8) * -- -- --
George Weissman.......... -- -- 10,000(8) * -- -- --
Richard E. Green......... -- -- 100,000(9) -- 300,000 * *
Herman Huizinga.......... -- -- -- -- -- -- --
Randall J. Smith......... -- -- 3,000(8) * -- -- --
Mark A. Stefanek......... -- -- 17,000(8) * -- -- --
All directors and
executive officers as a
group (11 persons)...... 56,670,893 95.8% 63,470,430 80.1% 303,565,168 38.4% 36.9%
(3) (3) (3)(9) (3)(5) (3)(5) (3)(5) (3)(5)
</TABLE>

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

* Less than 1%.

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<PAGE>
(1) Includes 6,246,096 shares issuable upon exercise of the 1996 WAT Warrant.
All of the shares are held by the WAT Trustee as trustee of Westfield
America Trust. Except with respect to the election of directors, the WAT
Trustee has the power to vote 23,960,029.5 (27,083,077.5 assuming exercise
of the WAT Warrants) of such shares in its absolute discretion and the
remaining shares held by the WAT Trustee are voted by the WAT Trustee as
directed by WAM, a subsidiary of Westfield Holdings Limited. The WAT Trustee
may only vote the shares for the election of directors as approved by the
holders of WAT units. The WAT Trustee disclaims beneficial ownership of such
shares. References to beneficial ownership are made herein solely with
respect to U.S. securities laws and are not intended to refer or apply in
any respect to Australian legal matters. Certain shareholders of the Company
hold options granted by WAT permitting such holders to exchange Common Stock
for ordinary units of WAT. If such options were exercised prior to
consummation of the Offerings, WAT's beneficial ownership of the Common
Stock would increase. See "Certain Transaction--Relationships and
Transactions with WAT."

(2) 10,930,672 of the shares of Common Stock are held by wholly-owned
subsidiaries of Westfield Holdings Limited. The balance represents shares of
Common Stock held in the name of the WAT Trustee which solely for purposes
of U.S. securities laws may be deemed to be beneficially owned by Westfield
Holdings by virtue of its ownership of WAM, which currently has the power to
direct the vote of 15,534,095.5 (18,657,143.5 assuming exercise of the 1996
WAT Warrant) of such shares, other than for the election of directors and
upon consummation of the Offerings (assuming 1,623,985 shares of Common
Stock are acquired by WAT in exchange for WAT units upon the anticipated
exercise of outstanding options by an existing shareholder prior to the
consummation of the Offerings). WAM will have the power to direct the vote
of 24,534,095.5 (28,701,919.5 assuming exercise of the WAT Warrants), other
than for the election of directors. WAM and the WAT Trustee share the
investment power over such shares. See footnote (1) above and footnote (4)
below. References to beneficial ownership are made herein solely with
respect to U.S. securities laws and are not intended to refer or apply in
any respect to Australian legal matters. Westfield Holdings' Board of
Directors has resolved to make a capital contribution to WAT which may
result in a reduction of Westfield Holdings' percentage interest in WAT by
approximately 1%. See "Certain Transactions."

(3) Messrs. Frank P. Lowy, David H. Lowy and Peter S. Lowy (each of whom is a
member of the Board of Directors, are directors and officers of Westfield
Holdings Limited) and interests associated with the Lowy family beneficially
own approximately 44% of the outstanding ordinary shares of Westfield
Holdings Limited and, as such, Messrs. Frank, David and Peter Lowy may be
deemed solely for purposes of U.S. securities laws to beneficially own the
securities indicated as owned and deemed beneficially owned by Westfield
Holdings Limited as set forth in footnote (2) above. Messrs. Frank, David
and Peter Lowy disclaim beneficial ownership of such securities. References
to beneficial ownership are made herein solely with respect to U.S.
securities laws and are not intended to refer or apply in any respect to
Australian legal matters.

(4) Includes 6,246,096 shares issuable upon exercise of the 1996 WAT Warrant,
2,089,552 shares issuable upon exercise of the 1997 WAT Warrant and
1,623,985 shares which are expected be exchanged for units in WAT upon
exercise by an existing shareholder of ordinary options prior to
consummation of the Offerings. The Company understands that one of its
existing shareholders intends to exercise 1,623,985 of such options prior to
consummation of the Offerings. All of the shares are held by the WAT Trustee
as trustee of Westfield America Trust. Except with respect to the election
of directors, the WAT Trustee has the power to vote 23,960,029.5
(27,083,077.5 assuming exercise of the WAT Warrants) of such shares in its
absolute discretion and the remaining shares held by the WAT Trustee are
voted by the WAT Trustee as directed by WAM, a subsidiary of Westfield
Holdings Limited. The WAT Trustee may only vote the shares for the election
of directors as approved by the holders of WAT units. The WAT Trustee
disclaims beneficial ownership of such shares. References to beneficial
ownership are made herein solely with respect to U.S. securities laws and
are not intended to refer or apply in any respect to Australian legal
matters.

(5) Interests associated with the Lowy family beneficially own 68,711,559 WAT
units. Messrs. Frank, David and Peter Lowy may be deemed solely for purposes
of the U.S. securities laws to beneficially

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<PAGE>
own 68,707,059, 67,576,559 and 67,572,059 of the WAT units, respectively,
benefically owned by such interests. Messrs. Frank, David and Peter Lowy
disclaim beneficial ownership of such WAT units. References to beneficial
ownership are made herein solely with respect to U.S. securities laws and
are not intended to refer or apply in any respect to Australian legal
matters.

(6) Excludes WAT units issuable in exchange for shares of Common Stock upon
exercise of WAT ordinary options that expire upon consummation of the
Offerings. Excludes WAT units issuable upon exercise of WAT special options,
which are not currently exercisable.

(7) Includes 32,479,700 WAT units which are expected to be issued upon exercise
of 1,623,985 ordinary options by an existing shareholders prior to the
consummation of the Offerings. Excludes WAT units issuable upon exercise of
WAT special options, which are not currently exercisable.

(8) Includes 30,000, 16,000, 10,000, 10,000, 3,000 and 17,000 shares expected to
be purchased by Messrs. Furman, Hilmer, Vincent, Weissman, Smith and
Stefanek in the Offerings. See "Underwriting."

(9) Takes account of the Shares to be acquired under the Orders (2,300,000 for
Westfield Holdings, 600,000 for interests associated with the Lowy family
and 100,000 for Richard E. Green).

Except as set forth above, no director or executive officer of the Company
will beneficially own shares of Common Stock as of completion of the Offerings.

119
<PAGE>
DESCRIPTION OF CAPITAL STOCK

The following summaries of certain provisions of the Articles and By-Laws,
as amended prior to consummation of the Offerings and concurrent transactions,
do not purport to be complete and are subject to, and are qualified in their
entirety by reference to, all of the provisions of the proposed Articles and By-
Laws, forms of which are exhibits to the Registration Statement of which this
Prospectus is a part, and by the provisions of the General Business and
Corporation Law of Missouri ("GBCL"). See "Additional Information."

CAPITAL STOCK

Upon the consummation of the Offerings and concurrent transactions, the
Articles will authorize the issuance of 410,000,200 shares of stock, consisting
of (i) two hundred (200) shares of non-voting senior preferred stock, par value
$1.00 per share (the "Senior Preferred Shares"), of which one hundred five (105)
shares are currently outstanding, (ii) five million (5,000,000) shares of
preferred stock, par value $1.00 per share (the "Preferred Stock"), of which
nine hundred forty thousand (940,000) shares are designated Series A cumulative
redeemable preferred stock (the "Series A Preferred Shares"), and of which nine
hundred forty thousand (940,000) are currently outstanding, and of which up to
400,000 shares will be designated Series B preferred stock (the "Series B
Preferred Shares") and of which 270,000 will be outstanding, (iii) 200,000,000
shares of common stock, par value $.01 per share (the "Common Stock"), of which
52,929,535 are currently outstanding (without giving effect to the Offerings, or
the exercise of the WAT Warrants), and (iv) 205,000,000 shares of excess stock,
par value $.01 per share, of which none are currently outstanding. Excess
Shares, if any, that are exchanged pursuant to the Articles (i) for Common
Stock, are sometimes referred to herein as "Excess Common Shares" and, together
with the Common Stock, the "Common Shares" and (ii) for Preferred Shares, are
sometimes referred to herein as "Excess Preferred Shares" and together with the
Preferred Shares, as "Preferred-Equity Shares."

SENIOR PREFERRED SHARES

The holders of Senior Preferred Shares shall be entitled to receive, when
and as declared by the Board of Directors, but only out of funds legally
available therefor, cash dividends at the annual rate of $35.00 per share, and
no more, payable quarterly. No dividend shall be paid on any Preferred Stock or
Common Shares unless the full dividend has been paid on Senior Preferred Shares.
In the event of any voluntary or involuntary liquidation, dissolution or winding
up of the affairs of the Company, the holders of Senior Preferred Shares shall
be entitled, before any distribution or payment is made to the holders of any
Preferred Stock or Common Shares, to be paid in full an amount equal to $550.00
per share, together with the full dividend thereon for the then current
quarterly-yearly dividend period. The Company, at the option of the Board of
Directors, may redeem in whole, but not in part, the Senior Preferred Shares at
the time outstanding at any time from and after February 20, 1999, upon notice,
at a redemption price for each Senior Preferred Share equal to $550.00, together
with the full dividend thereon for the then current quarterly-yearly dividend
period. Except as required by applicable law, the holders of Senior Preferred
Shares shall have no voting rights in the Company. The Company may repurchase
the outstanding Senior Preferred Shares after the consummation of the Offerings.

PREFERRED STOCK

Preferred Stock may be issued, from time to time, in one or more series as
authorized by the Board of Directors. Prior to issuance of a series, the Board
of Directors by resolution shall designate that series to distinguish it from
other series and classes of stock of the Company, shall specify the number of
shares to be included in the series, and shall fix the terms, rights,
restrictions and qualifications of the shares of the series, including any
preferences, voting powers, dividend rights and redemption, sinking fund and
conversion rights. Subject to the express terms of any other series of Preferred
Stock outstanding at the time, the Board of Directors may increase or decrease
the number of shares or alter the designation or classify or reclassify any
unissued shares of a particular series of Preferred Stock by fixing or altering
in any one or more respects from time to time before issuing the shares any
terms, rights, restrictions and qualifications of the shares.

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<PAGE>
SERIES A PREFERRED SHARES

The holders of Series A Preferred Shares shall be entitled to receive, when
and as declared by the Board of Directors, but only out of funds legally
available therefor, per share cumulative cash dividends equal to the greater of
(i) $8.50 per annum and (ii) an amount currently equal to 6.2461 times the
dollar amount declared on Common Shares for such period, subject to certain
adjustments. Holders of Series A Preferred Shares are entitled to dividends
before dividends can be distributed to holders of Common Shares. In the event of
any voluntary or involuntary liquidation, dissolution or winding up of the
affairs of the Company, the holders of Series A Preferred Shares shall be
entitled, before any distribution or payment is made to the holders of any
Common Shares, to be paid in full an amount per share equal to $100.00, together
with all accrued and unpaid dividends through the end date of the calendar
quarter most recently completed prior to the date of liquidation, dissolution or
winding up of the affairs of the Company plus $2.125 times a fraction equal to
the actual number of days elapsed from the end date of the calendar quarter most
recently completed to the relevant liquidation date over 90 days. From and after
July 1, 2003, the Company, at the option of the Board of Directors, with
approval of a majority of the Independent Directors, may redeem in whole, or in
part, the outstanding Series A Preferred Shares at a redemption price of $100.00
per share, together with all accrued and unpaid dividends through the end date
of the calendar quarter most recently completed prior to the redemption date
plus $2.125 times a fraction equal to the actual number of days elapsed from the
end date of the calendar quarter most recently completed to the relevant
redemption date over 90 days, plus a right to receive on the payment date for
the next quarterly dividend declared on the Common Stock an amount equal to the
proportionate additional amount, if any, of dividends the holder of such Series
A Preferred Share would have been entitled to receive had such share been held
on the record date for such Common Stock dividend.

The holders of Series A Preferred Shares shall have no voting rights in the
Company except: (i) in the event that the Board of Directors has not declared a
dividend payable to holders of Series A Preferred Shares or any series of
Preferred Shares authorized with the consent of the holders of Series A
Preferred Shares ranking PARI PASSU with the Series A Preferred Shares ("Ranking
Preferred Shares") for four quarterly dividend periods, the number of directors
constituting the Board of Directors shall, without further action, be increased
by one and the holders of a majority of the Series A Preferred Shares together
with all series of Ranking Preferred Shares shall have the exclusive right to
elect one director to fill such newly created directorship until such time as
all such dividends in arrears are made current and paid in full, at which time
the director so elected shall cease to be a director, and the number of
directors constituting the Board of Directors shall be reduced by one, (ii) a
majority vote of the holders of Series A Preferred Shares voting together as a
class shall be required to approve any amendment to the Articles that materially
and adversely affects their rights, PROVIDED, that (x) except where a unanimous
vote is required under clause (y) below, where the amendment adversely affects
the rights of any series of Ranking Preferred Shares, then such amendment shall
be approved by the vote of the Series A Preferred Shares and the Ranking
Preferred Shares affected thereby voting together as a class and (y) the
unanimous approval of the holders of Series A Preferred Shares shall be required
for any amendment to the Articles that would decrease the rate or change the
time of payment of any dividend or distribution on the Series A Preferred
Shares, decrease the amount payable upon redemption of the Series A Preferred
Shares or upon liquidation of the Company, advance the date on which the Series
A Preferred Shares may be redeemed by the Company or amend the number of shares
of Series A Preferred Shares required to effect amendments to the Articles,
(iii) the affirmative vote of the holders of a majority of the Series A
Preferred Shares and any series of Ranking Preferred Shares affected thereby
voting together as a class shall be required to approve any merger or
consolidation of the Company and another entity in which the Company is not the
surviving corporation and each holder of the Series A Preferred Shares and such
Ranking Preferred Shares do not receive shares of the surviving corporation with
substantially similar rights, preferences and powers in the surviving
corporation as such Preferred Shares have with respect to the Company, (iv) the
affirmative vote of the holders of a majority of the Series A Preferred Shares
and the Ranking Preferred Shares voting together as a class shall be required to
approve any voluntary action by the Board of Directors intended to cause the
Company to cease to have the status as a REIT and (v) as otherwise required by
applicable law.

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SERIES B PREFERRED SHARES

The holders of Series B Preferred Shares have the same rights as the holders
of Series A Preferred Shares and the terms of the Series B Preferred Shares are
substantially the same as those of the Series A Preferred Shares, except that
the amount of cumulative cash distributions will be equal to the greater of (i)
$8.50 per annum and (ii) an amount equal to the product of (x) 100 divided by
the Price to Public and (y) the dollar amount declared on the Common Shares for
the applicable period, subject to certain adjustments.

COMMON SHARES

DISTRIBUTION RIGHTS

The holders of Common Shares shall be entitled to receive such distributions
as may be declared by the Board of Directors out of funds legally available
therefor. In order to qualify as a REIT, the Company is required to distribute
at least 95% of its taxable income. The Company currently intends to continue to
pay regular quarterly distributions to its shareholders with the distribution in
respect of the quarter ending June 30, 1997 to be paid on or about July 31,
1997. Under the Articles, holders of the Senior Preferred Shares and Preferred
Shares will continue to have a preference with respect to dividends relative to
the holders of Common Shares. The Company expects that regular quarterly
distributions of the Company will be declared for the three month periods ending
March 31, June 30, September 30 and December 31 each year. All distributions
will be at the discretion of the Board of Directors and will depend on the
actual Funds from Operations, the Company's financial condition, the annual
distribution requirements under the REIT Requirements and such other factors as
the Board of Directors deems relevant and will be subject to the prior payment
of preferred stock dividends.

LIQUIDATION RIGHTS

In the event of liquidation, dissolution, winding up of, or any distribution
of the assets of the Company, each holder of Common Shares shall be entitled to
receive ratably with each holder of Common Shares, in that portion of the assets
of the Company available for distribution to holders of Common Shares as the
number of Common Shares held by such holder bears to the total number of Common
Shares then outstanding.

VOTING RIGHTS

At all meetings of the shareholders of the Company, each holder of Common
Shares shall be entitled to one vote for each Common Share entitled to vote at
such meeting. The affirmative vote of a majority of the holders of Common Shares
voting together as a class shall be required to approve: (1) an election to
change the Company's status as a REIT, and (2) other matters as required by
applicable law.

ELECTION AND REMOVAL OF DIRECTORS

The Board of Directors will be divided into three classes with the terms of
office of directors of each class ending in different years. The Class I, II and
III directors are to serve until the Annual Meeting of Shareholders in 1998,
1999 and 2000, respectively, or until their successors are elected. Following
such initial term, the directors will serve three-year terms, or until their
successors are elected.

Directors will be elected by a plurality of the Common Shares entitled to
vote on the election of directors represented in person or by proxy at a meeting
at which a quorum is present, subject to any rights of holders of the Preferred
Stock to elect directors. There are no cumulative voting rights. The Articles
will provide that directors may be removed from office only for cause and with
the vote of 66 2/3% of the outstanding Common Shares then entitled to vote for
the election as directors.

PREEMPTIVE RIGHTS

No holder of Common Shares shall be entitled as a matter of right to
subscribe for or purchase, or have any preemptive right with respect to, any
part of any new or additional issue of stock of any class whatsoever, or of
securities convertible into any stock of any class whatsoever, whether now or
hereafter authorized and whether issued for cash or other consideration or by
way of dividend.

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REDEMPTION RIGHTS

No holder of Common Shares is entitled to redemption rights.

SHAREHOLDER LIABILITY

Under Missouri corporate law, no shareholder of the Company will be liable
personally for any obligation of the Company solely as a result of their status
as a shareholder.

RESTRICTIONS ON OWNERSHIP AND TRANSFER

In order for the Company to qualify as a REIT under the Code, not more than
50% in value of its outstanding capital stock may be owned, directly or
indirectly, by or for five or fewer individuals, including certain entities (as
set forth in the Code and referred to herein as "Individuals") during the last
half of a taxable year, and the shares of capital stock must be beneficially
owned by 100 or more persons during at least 335 days of a taxable year of 12
months, or during a proportionate part of a shorter taxable year. Because the
Board of Directors believes that it is essential for the Company to continue to
qualify as a REIT, the Board of Directors has adopted, and the shareholders have
approved, provisions of the Articles restricting the acquisition and ownership,
directly and indirectly, of shares of the Company's capital stock.

The Company's Articles provide, subject to certain exceptions specified
therein, that after the Closing of the Offering no Individual may own, or be
deemed to own by virtue of various attribution and constructive ownership
provisions of the Code, more than 5.5% (except for Frank P. Lowy and the members
of his family who are prohibited from owning, directly or indirectly, more than
26.0%) of the outstanding shares of capital stock of the Company, as measured by
value (the "Ownership Limit"). The Articles authorize the Board of Directors to
increase the Ownership Limit on a case by case basis if evidence satisfactory to
the Board of Directors, based upon the advice of the Company's tax counsel or
other evidence or undertakings acceptable to it, is presented that such
ownership will not then or in the future jeopardize the Company's status as a
REIT. As a condition of such increase, the Board of Directors in its discretion
may require opinions of counsel satisfactory to it, and/or undertakings from the
applicant with respect to preserving the REIT status of the Company. The
restrictions on ownership will not apply if the holders of the Company's capital
stock determine that it is no longer in the best interest of the Company to
attempt to qualify, or to continue to qualify, as a REIT by resolution duly
adopted by a majority of the holders of each of the Common Stock and the
Preferred Stock.

If shares of capital stock in violation of the Ownership Limit or shares of
capital stock which would cause the Company to be beneficially owned by less
than 100 persons, or which would result in it being "closely held" within the
meaning of Section 856(h) of the Code, or which would otherwise result in the
Company failing to qualify as a REIT, are issued or transferred to any person or
Individual, such issuance or transfer will be null and void to the intended
transferee, and the intended transferee would acquire no rights to the capital
stock. If, notwithstanding the preceding sentence, shares of capital stock are
transferred in violation of the rules set forth therein or the Ownership Limit,
such shares will automatically be converted into Excess Shares and transferred
to one or more trusts for the benefit of a designated charitable organization,
and if required by the Articles, such other charitable organizations as may be
designated from time to time by the Board of Directors (each a "Charitable
Trust"). In addition, if any other event occurs which would result in any person
or Individual directly or indirectly holding shares of capital stock in
violation of the Ownership Limit, then shares of capital stock directly or
indirectly held by such person or Individual will be transferred to a Charitable
Trust to the extent of such excess. Shares transferred to a Charitable Trust
will remain outstanding, and the trustee of the trust will have all voting and
dividend rights pertaining to such shares. Dividends made after violation of the
Ownership Limit but prior to discovery of such violation shall be returned to
the Company and thereafter turned over to the trustee of the Charitable Trust.
The trustee of such trust shall transfer such shares to a person whose ownership
of such shares does not violate the Ownership Limit or other applicable
limitations. Upon a sale of such shares by the trustee, the interest of the
charitable beneficiary will terminate, the Excess Shares will automatically be
converted into shares of capital stock of the same type and class as the shares
from which they were converted, and the sales proceeds would be paid, first, to
the original intended transferee, to the extent of the lesser of (a) such
transferee's original purchase price (or the original market value of such

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shares if originally transferred to such person without having given value for
such shares) and (b) the price received by the trustee. Any remaining proceeds
will be paid to the charitable beneficiary. In addition, the Company may, for a
90 day period, designate the person to whom the trustee will sell the capital
stock held in the Charitable Trust. The 90-day period commences on the date of
the transfer in violation of the foregoing provisions that gave rise to the
issuance of Excess Shares, or the date that the Company first becomes aware of
such transfer, whichever is later.

All certificates representing shares of Common Stock will bear a legend
referring to the restrictions described above, as follows:

The Common Shares represented by this certificate are subject to
restrictions on ownership and transfer for the purpose of the Corporation's
maintenance of its status as a real estate investment trust under the
Internal Revenue Code of 1986, as amended. No Individual may Beneficially
Own Shares in excess of the then applicable Ownership Limit, which may
decrease or increase from time to time, unless such Individual is an
Existing Holder. In general, any Individual who attempts to Beneficially Own
Shares in excess of the Ownership Limit must immediately notify the
Corporation. All capitalized terms used in this legend have the meanings set
forth in the Articles of Incorporation, a copy of which, including the
restrictions on ownership and transfer, will be sent without charge to each
shareholder who so requests. If the restrictions on ownership and transfer
are violated, the Common Shares represented hereby may be automatically
exchanged for Excess Shares and deemed transferred to a Special Trust as
provided in the Articles of Incorporation.

Each shareholder shall upon demand be required to disclose to the Company in
writing such information with respect to the direct, indirect and constructive
ownership of shares as the Board of Directors deems necessary to comply with the
provisions of the Code applicable to a REIT or to comply with the requirements
of any taxing authority or governmental agency.

The ownership limitations may have the effect of precluding acquisition of
control of the Company by a third party unless the Board of Directors and the
shareholders determine that maintenance of REIT status is no longer in the best
interests of the Company.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock is American Stock
Transfer & Trust Company.

LISTING

Prior to the Offerings, there has been no public trading market for shares
of Common Stock. The Common Stock has been approved for listing on the NYSE,
subject to official notice of issuance, under the trading symbol "WEA."

CERTAIN PROVISIONS OF THE COMPANY'S
ARTICLES OF INCORPORATION AND BY-LAWS AND OF MISSOURI LAW

Certain provisions of the Articles and By-Laws of the Company that will be
in effect upon consummation of the Offerings and the General Business and
Corporation Law of Missouri (the "GBCL"), as well as the substantial influence
of WAT and Westfield Holdings may delay or make more difficult unsolicited
acquisitions or changes in control of the Company. It is believed that such
provisions will enable the Company to develop its business in a manner that will
foster its long-term growth without disruption caused by the threat of a
takeover not deemed by its Board of Directors to be in the best interests of the
Company and its shareholders. Such provisions could have the effect of
discouraging third parties from making proposals involving an unsolicited
acquisition or change of control of the Company, although such proposals, if
made, might be considered desirable by the holders of the Shares. Such
provisions may also have the effect of making it more difficult for third
parties to cause the replacement of the current management of the Company
without the concurrence of the Board of Directors. These provisions include
among others, (i) the Ownership Limit, (ii) the availability of capital stock
for issuance from time to time at the discretion of the Board of Directors (see
"Description of Capital Stock--Capital Stock" and "Description of Capital
Stock--Preferred Shares"), (iii) a classified board of directors, (iv) inability
of the shareholders to take action by written consent, (v) prohibitions against
shareholders calling a special

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meeting of shareholders, (vi) requirements for advance notice for raising
business or making nominations at shareholders' meetings, and (vii) additional
requirements for certain business combination transactions. The descriptions set
forth herein of such provisions do not purport to be complete and are qualified
in their entirety by reference to the Articles and By-Laws, which have been
filed as exhibits to the Registration Statement of which this Prospectus is a
part, and to the provisions of the GBCL.

OWNERSHIP LIMIT

The Articles contain the Ownership Limit which may discourage a change in
control of the Company, and may also deter tender offers for Common Stock that
might otherwise be advantageous to holders of the Common Stock. The Ownership
Limit may limit the opportunities of holders to receive a premium for their
Common Stock that might otherwise exist if an investor were attempting to
assemble a block of shares or otherwise effect a change in control of the
Company.

ADDITIONAL CLASSES AND SERIES OF PREFERRED STOCK

The Board of Directors is authorized to issue additional authorized but
unissued shares of Common Stock and to establish one or more series of Preferred
Stock and establish the number of shares to be included in the series and the
terms of such series, including any preferences, voting powers, dividend rights
and redemption, sinking fund and conversion rights, and issue such Common Stock
and Preferred Stock, without any further vote or action by the shareholders,
unless such action is required by applicable law or the rules of any stock
exchange or automated quotation system on which the Company's securities are
listed. The issuance of additional capital stock may have the effect of
delaying, deferring or preventing a change in control of the Company. The
issuance of additional series of Preferred Stock with voting or conversion
rights may adversely affect the voting power of the holders of Common Stock. The
ability of the Board of Directors to issue additional capital stock, while
providing flexibility in connection with possible acquisitions and other
corporate purposes, could have the effect of making it more difficult for a
third party to acquire, or of discouraging a third party from acquiring, a
majority of the outstanding voting stock of the Company.

SIZE OF BOARD, ELECTION OF DIRECTORS, CLASSIFIED BOARD, REMOVAL OF DIRECTORS AND
FILLING VACANCIES

The Articles and By-Laws will provide that the Board of Directors be divided
into three classes as nearly equal in number as possible, with directors having
three-year terms of office that expire at different times in annual succession.
The Articles will provide that directors may not be removed from office prior to
the expiration of their term without cause and the vote of 66 2/3% of the
outstanding Common Shares. A classified board makes it more difficult for
shareholders to change a majority of the directors.

The By-Laws will limit the total number of directors to 14 and provide that
newly created directorships resulting from any increase in the authorized number
of directors (or any vacancy) may be filled by a vote of a majority of directors
then in office. Accordingly, the Board of Directors may be able to prevent any
shareholder from obtaining majority representation on the Board of Directors by
increasing the size of the board and filling the newly created directorships
with its own nominees.

LIMITATIONS ON SHAREHOLDER ACTION BY WRITTEN CONSENT; ABILITY TO CALL SPECIAL
MEETINGS

As required by the GBCL, the Articles and the By-Laws provide that an action
by written consent of shareholders in lieu of a meeting must be unanimous. The
By-Laws will provide that, unless otherwise prescribed by statute or the
Articles, special meetings of the shareholders can be called only by the
Chairman of the Board of Directors, any President or by resolution of the Board
of Directors. Furthermore, as required by the GBCL, the By-Laws will provide
that only such business as is specified in the notice of any such special
meeting of shareholders may come before such meeting.

These provisions may have an adverse effect on the ability of shareholders
to influence the governance of the Company and the possibility of shareholders
receiving a premium above market price for their securities from a potential
acquiror who is unfriendly to management.

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ADVANCE NOTICE FOR RAISING BUSINESS OR MAKING NOMINATIONS AT MEETINGS

The By-Laws will establish an advance notice procedure for shareholder
proposals to be brought before an annual meeting of shareholders and for
nominations by shareholders of candidates for election as directors at an annual
or special meeting at which directors are to be elected. Only such business may
be conducted at an annual meeting of shareholders as has been brought before the
meeting by, or at the direction of, the Board of Directors, or by a shareholder
who has given to the Secretary of the Company timely written notice, in proper
form, of the shareholder's intention to bring that business before the meeting.
The Chairman of such meeting will have the authority to make such
determinations. Only persons who are nominated by, or at the direction of, the
Board of Directors, or who are nominated by a shareholder who has given timely
written notice, in proper form, to the Secretary prior to a meeting at which
directors are to be elected will be eligible for election as directors of the
Company.

To be timely, notice of business to be brought before an annual meeting or
nominations of candidates for election as directors at an annual meeting is
required to be received by the Secretary of the Company not less than 60 nor
more than 90 days in advance of the meeting (or, in the event that less than 70
days' notice or prior public disclosure of the date of the meeting is given or
made to shareholders, not later than 10 days after the first public notice or
disclosure of the date of such annual meeting).

The notice of any nomination for election as a director is required to set
forth the name and address of the shareholder who intends to make the nomination
and of the person or persons to be nominated, the age and the principal
occupation or employment of each nominee, the class and number of shares
beneficially owned by such shareholder and by each nominee, such other
information regarding each nominee proposed by such shareholder required to be
included in a proxy statement filed pursuant to the proxy rules of the
Commission, and the consent of each nominee to be named as a nominee who would
serve as a director if so elected.

BUSINESS COMBINATION AND CONTROL SHARE ACQUISITION STATUTES AND RELATED
PROVISIONS

The Company is subject to the GBCL which contains certain provisions which
may be deemed to have an anti-takeover effect. Such provisions include
Missouri's Business Combination Statute and the control share acquisition
statute.

The Missouri Business Combination Statute prohibits certain transactions
between corporations subject to the statute and certain shareholders of such
corporations. In particular, the statute restricts certain "Business
Combinations" between a corporation and an "Interested Shareholder" or
affiliates of the Interested Shareholder unless certain conditions are met. A
"Business Combination" includes a merger or consolidation, certain sales,
leases, exchanges, pledges and similar dispositions of corporate assets or stock
and certain reclassifications and recapitalizations. An "Interested Shareholder"
includes any person or entity which beneficially owns or controls 20% or more of
the outstanding voting shares of the corporation.

During the five-year restricted period after a person or entity becomes an
Interested Shareholder, no Business Combination may occur unless such Business
Combination or the transaction in which the person or entity become an
Interested Shareholder (the "Acquisition Transaction") was approved by the board
of directors of the corporation on or before the date of the Acquisition
Transaction. Business Combinations may occur after the five-year period
following the Acquisition Transaction only if: (i) prior to the Acquisition
Transaction, the board of directors approved the Acquisition Transaction or
approved the Business Combination in question; (ii) the holders of a majority of
the outstanding voting stock, other than stock owned by the Interested
Shareholder, approve the Business Combination; or (iii) the Business Combination
satisfies certain detailed fairness and procedural requirements.

The statute applies only to Missouri corporations which have either their
principal place of business or substantial assets in Missouri. In addition, the
corporation must have at least 100 shareholders, and (i) more than 10% of the
shareholders must be resident in Missouri, (ii) more than 10% of the outstanding
shares must be owned by Missouri residents, or (iii) more than 10,000
shareholders must be residents in Missouri (certain shares, such as shares held
by nominees, are disregarded in applying these tests). It will not be known
whether this latter requirement is met and whether the statute will be
applicable to the Company until after the Offerings has been completed.

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The GBCL exempts from the statute: (i) corporations not having a class of
voting stock registered under Section 12 of the Exchange Act; (ii) corporations
which adopt provisions in their articles of incorporation or by-laws expressly
electing not to be covered by the statute; and (iii) certain circumstances in
which a shareholder inadvertently becomes an Interested Shareholder. The
Company's Articles and By-Laws do not contain an election to "opt out" of the
Missouri Business Combination Statute.

Because the Missouri Business Combination Statute may not apply to the
Company, the Articles will contain a similar provision which will provide that,
during the five-year restricted period after a person or entity becomes an
Interested Shareholder, no Business Combination may occur unless such Business
Combination or the transaction in which the person or entity becomes an
Interested Shareholder was approved by the Board of Directors on or before the
date of the Acquisition Transaction or such person or entity was an Interested
Shareholder on the date the provision was adopted by the shareholders of the
Company. Business Combinations may occur after the five-year period following
the Acquisition Transaction only if (i) prior to the Acquisition Transaction,
the board of directors approved the Acquisition Transaction or approved the
Business Combination in question; (ii) the holders of a majority of the
outstanding voting stock, other than stock owned by the Interested Shareholder,
approve the Business Combination; or (iii) the Business Combination satisfies
certain detailed fairness and procedural requirements.

This provision may make it more difficult for a 20% beneficial owner to
effect transactions with the Company and may encourage persons interested in
acquiring the Company to negotiate in advance with the Board of Directors prior
to acquiring a 20% interest. It is possible that such a provision could make it
more difficult to accomplish a transaction which shareholders may otherwise deem
to be in their best interest.

The GBCL also contains a "Control Share Acquisition Statute" which may,
under some circumstances, limit the voting rights of certain shareholders. The
statute provides that an "Acquiring Person" who after any acquisition of shares
of certain publicly traded Missouri corporations has the voting power, when
added in all shares of the corporation previously owned or controlled by the
Acquiring Person, to exercise or direct the exercise of: (i) 20% but less than
33 1/3%, (ii) 33 1/3% or more but less than a majority or (iii) a majority, of
the voting power of outstanding stock of such corporation, will lose the right
to vote some or all of such shares unless the shareholder approval for the
purchase of the "Control Shares" is obtained. To obtain such approval, certain
disclosure requirements must be met and the retention or restoration of voting
rights approved by both: (i) a majority of the outstanding voting stock, and
(ii) a majority of the outstanding voting stock after exclusion of "Interested
Shares." Interested Shares are defined as shares owned by the Acquiring Person,
by directors who are also employees, and by officers of the corporation.
Shareholders are given dissenters' rights with respect to the vote on Control
Share Acquisitions and may demand payment of the fair value of their shares.

Certain acquisitions of shares are deemed not to constitute Control Share
Acquisitions, including good faith gifts, transfers pursuant to wills, purchases
pursuant to an issuance by the corporation, mergers involving the corporation
which satisfy the other requirements of the GBCL, transactions with a person who
owned a majority of the voting power of the corporation within the prior year,
or purchases from a person who has previously satisfied the provisions of the
Control Share Acquisition Statute so long as the transaction does not result in
the purchasing party having voting power after the purchase in a percentage
range (such ranges are as set forth in the immediately preceding paragraph)
beyond the range for which the selling party previously satisfied the provisions
of the statute. The statute applies only to Missouri corporations which satisfy
requirements as to their place of business or assets and the residence of the
shareholders similar to those applicable to the Business Combination Statute, as
described above. Consequently, it will not be known whether these requirements
are met and thus whether the statute will be applicable to the Company until
after the Offerings has been completed. Additionally, a corporation may exempt
itself from application of the statute by inserting a provision in its articles
of incorporation or by-laws expressly electing not to be covered by the statute.
The Company's Articles and By-Laws do not contain an election to "opt out" of
the Control Share Acquisition Statute.

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TERMINATION OF REIT STATUS

The Articles permit the directors, with the approval of a majority of each
of the holders of the Common Stock and the Preferred Shares, to terminate the
status of the Company as a REIT under the Code at any time.

LIMITATION ON LIABILITY OF DIRECTORS; INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Articles limit the liability of directors of the Company, in their
capacity as such, whether to the Company, its shareholders or otherwise, to the
fullest extent permitted by Missouri law.

The Articles also contain provisions indemnifying the Company's directors
and officers to the maximum extent permitted by Missouri law. Section 355.1 of
the GBCL provides that the Company may indemnify its directors, officers,
employees and agents in any action, suit or proceeding other than an action by
or in the right of the Company, against expenses (including attorneys' fees),
judgments, fines and settlement amounts actually and reasonably incurred by such
person in connection with such action, suit or proceeding if such person acted
in good faith and in a manner that such person reasonably believed to be in or
not opposed to the best interests of the Company and, with respect to any
criminal action, had no reasonable cause to believe his conduct was unlawful.
Section 355.2 of the GBCL provides that the Company may indemnify any such
person in any action or suit by or in the right of the Company against expenses
(including attorneys' fees) and settlement amounts actually and reasonably
incurred by him in connection with the defense or settlement of the action or
suit if such person acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Company, except that such
person may not be indemnified in respect of any matter in which such person has
been adjudged liable for negligence or misconduct in the performance of his duty
to the Company, unless authorized by the court. Section 355.1 of the GBCL
provides that the Company shall indemnify any such person against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the action, suit or proceeding if such person has been
successful in defending such action, suit or proceeding and if such action, suit
or proceeding is one for which the Company may indemnify him under Section 355.1
or 355.2. Section 355.7 of the GBCL provides that the Company shall have the
power to give any further indemnity to any such person, in addition to the
indemnity otherwise authorized under Section 355, provided such further
indemnity is either (i) authorized, directed or provided for in the Articles or
any duly adopted amendment thereof or (ii) is authorized, directed or provided
for in any By-Law or agreement of the Company which has been adopted by a vote
of the shareholders of the Company, provided that no such indemnity shall
indemnify any person from or on account of any conduct of such person which was
finally adjudged to have been knowingly fraudulent or deliberately dishonest or
to constitute willful misconduct.

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SHARES AVAILABLE FOR FUTURE SALE

GENERAL

Upon consummation of the Offerings, there will be 70,929,535 shares of
Common Stock issued and outstanding (73,629,535 shares if the Underwriters'
over-allotment options are exercised in full). Upon consummation of the
Offerings and concurrent transactions, WAT will hold the 1996 WAT Warrants
entitling it to purchase at any time and from time to time, in whole or in part,
6,246,096 shares of Common Stock, at an exercise price of $16.01 per share
(which is the same price paid by WAT for the Common Stock it purchased in
connection with the Recapitalization), and the 1997 WAT Warrant, entitling it to
purchase at any time and from time to time, in whole or in part, 2,089,552
shares of Common Stock, in each case subject to adjustment in certain events.
See "Certain Transactions--Relationships and Transactions with WAT" and
"Principal Shareholders." No prediction can be made as to the effect, if any,
that future sales of shares of Common Stock, the availability of shares of
Common Stock for future sale, or future issuances of shares upon the exercise of
the WAT Warrants will have on the market price of the Common Stock prevailing
from time to time.

All of the Shares sold in the Offerings will be freely tradeable by persons
other than "affiliates" of the Company without restriction under the Securities
Act, subject to the limitations on ownership set forth in the Articles. See
"Description of Capital Stock--Restrictions on Ownership and Transfer." There
are 52,055,082 shares of outstanding Common Stock owned by Westfield Holdings,
WAT and certain other shareholders, as well as the shares issuable upon exercise
of the WAT Warrants (the "Restricted Shares"), which will be "restricted"
securities within the meaning of Rule 144 promulgated under the Securities Act
("Rule 144") and may not be sold in the absence of registration under the
Securities Act unless an exemption from registration is available, including
exemptions contained in Rule 144. As described below under "--Registration
Rights," the Company has granted Westfield Holdings certain registration rights
with respect to its shares of Common Stock.

Of the 41,118,110 outstanding shares of Common Stock held by WAT, 31,342,970
shares may be eligible for sale in the public market 90 days after the effective
date of the Registration Statement of which this Prospectus is a part, 8,151,155
shares may become eligible for sale in the public market on January 2, 1998 and
1,623,985 shares of Common Stock (that are currently held by unaffiliated
investors that are expected to be exchanged for WAT Units prior to the Offerings
and that otherwise become eligible for sale in the public market 90 days after
completion of the Offerings and will become freely tradeable on July 1, 1998)
may become eligible for sale in the public market on the first anniversary of
the consummation of the Offerings in each case subject to compliance with the
volume limitations under Rule 144. All of the 10,930,692 shares of Common Stock
held by Westfield Holdings prior to consummation of the Offerings (and any
Shares to be acquired under the Orders) may be eligible for sale in the public
market 90 days after the completion of the Offerings, subject to compliance with
the volume limitations under Rule 144.

In general, under Rule 144, if one year has elapsed since the later of the
date of acquisition of restricted shares from the Company or any affiliate of
the Company, the acquiror or subsequent holder thereof is entitled to sell, and
any affiliate is entitled to sell, within any three-month period commencing 90
days after the date of the effectiveness of the Registration Statement of which
this Prospectus is a part, a number of shares that does not exceed the greater
of (i) 1% of the then outstanding shares of Common Stock (709,295 shares upon
consummation of the Offerings) or (ii) the average weekly trading volume in the
Common Stock during the four calendar weeks preceding such sale, subject to the
filing of a Form 144 with respect to such sale and certain other limitations and
restrictions. In addition, if two years have elapsed since the later of the date
of acquisition of restricted shares from the Company or from any affiliate of
the Company, and the acquiror or any subsequent holder thereof is not deemed to
have been an affiliate of the Company at any time during the 90 days preceding a
sale, such person would be entitled to sell such shares under Rule 144(k)
without regard to the above-described requirements.

In addition, the Commission has recently proposed further revisions to the
holding periods and volume limitations contained in Rule 144. The adoption of
amendments effecting such proposed revisions may result in resales of restricted
securities sooner than would be the case under Rules 144 and 144(k) as

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currently in effect. However, there can be no assurance of when, if ever, such
amendments will be proposed or adopted.

Prior to the Offerings, there has been no public market for the shares of
Common Stock in the United States. The Common Stock has been approved for
listing on the NYSE, subject to official notice of issuance, under the symbol
"WEA". No prediction can be made as to the effect, if any, that future sales of
Common Stock, or the availability of Common Stock for future sale or any
exercise of the WAT Warrant, will have on the market price of the shares of
Common Stock prevailing from time to time. Sales of substantial amounts of
Common Stock, or any exercise of the WAT Warrants, or the perception that such
sales or exercise could occur, could adversely affect prevailing market prices
of the shares of Common Stock. See "Risk Factors--Absence of Public Market for
Shares; Possible Volitility of Stock Price."

REGISTRATION RIGHTS

The Company, Westfield Holdings, interests associated with the Lowy family
and Richard E. Green, a Co-President of the Company, will each agree, subject to
certain exceptions (including the concurrent transactions and the exercise of
the WAT Warrants), not to (i) sell, grant any option, right or warrant for the
sale of, or to purchase or otherwise transfer or dispose of any Common Stock or
securities convertible into or exchangeable or exercisable for Common Stock or
file a registration statement under the Securities Act with respect to the
foregoing or (ii) enter into any swap or other agreement or transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, for a period of 90 days from the date of this
Prospectus in the case of the Company and any Shares which may be acquired under
the Orders, and 36 months from the date of this Prospectus in the case of shares
held by Westfield Holdings prior to consummation of the Offerings, without the
prior written consent of Merrill Lynch. Pursuant to a registration rights
agreement (the "Registration Rights Agreement"), after 36 months from the
closing of the Offerings, Westfield Holdings will have demand registration
rights that would require the Company to promptly effect the registration of
their shares held prior to the consummation of the Offerings. In addition, 90
days after the closing of the Offerings Westfield Holdings will have demand
registration rights for any other shares of Common Stock. In addition, the
Company has agreed that, upon the request of Westfield Holdings, it will use its
reasonable efforts to have a shelf registration statement filed after the
expiration of such 36-month period referred to above (after 12 months for any
shares not held prior to consummation of the Offerings) and declared and kept
continuously effective, pursuant to which Westfield Holdings will be able to
sell Common Stock in ordinary course brokerage or dealer transactions. However,
these rights allow the Company to postpone the filing of a demand registration
statement (and an amendment or supplement to a shelf registration statement) or
to suspend the use of any previously filed registration statement for a
reasonable period of time (not to exceed 60 days) if the Board of Directors
determines in good faith that it would be significantly disadvantageous to the
Company and its shareholders for such a registration statement (or amendment or
supplement) to be filed on or before the date filing otherwise would be
required. In addition, if the Company proposes to register any of its Common
Stock, either for its own account or for the account of other shareholders, the
Company is required, with certain exceptions, to provide the parties to the
Registration Rights Agreement with notice of the registration and to include in
such registration all of the shares of Common Stock requested to be included by
such persons. Any exercise of such registration rights may result in dilution in
the interest of the Company's shareholders, hinder efforts by the Company to
arrange future financings of the Company and/or have an adverse effect on the
market price of the Common Stock.

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FEDERAL INCOME TAX CONSIDERATIONS

THE FOLLOWING SUMMARY OF MATERIAL FEDERAL INCOME TAX CONSIDERATIONS
REGARDING AN INVESTMENT IN THE COMMON STOCK IS BASED ON CURRENT LAW, IS FOR
GENERAL INFORMATION ONLY AND IS NOT TAX ADVICE. THIS DISCUSSION DOES NOT PURPORT
TO DEAL WITH ALL ASPECTS OF TAXATION THAT MAY BE RELEVANT TO PARTICULAR
INVESTORS IN LIGHT OF THEIR PERSONAL INVESTMENT OR TAX CIRCUMSTANCES, OR, EXCEPT
TO THE EXTENT DISCUSSED UNDER "--TAXATION OF TAX-EXEMPT SHAREHOLDERS" AND
"--TAXATION OF FOREIGN SHAREHOLDERS," TO CERTAIN TYPES OF INVESTORS (INCLUDING
INSURANCE COMPANIES, TAX-EXEMPT ORGANIZATIONS, FINANCIAL INSTITUTIONS OR
BROKER-DEALERS, FOREIGN CORPORATIONS AND PERSONS WHO ARE NOT CITIZENS OR
RESIDENTS OF THE UNITED STATES) THAT ARE SUBJECT TO SPECIAL TREATMENT UNDER THE
FEDERAL INCOME TAX LAWS NOR DOES IT GIVE A DETAILED DISCUSSION OF ANY STATE,
LOCAL OR FOREIGN TAX CONSIDERATIONS.

EACH PROSPECTIVE PURCHASER SHOULD CONSULT WITH ITS TAX ADVISOR REGARDING THE
SPECIFIC TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND SALE OF THE SHARES AND
OF THE COMPANY'S ELECTION TO BE TAXED AS A REAL ESTATE INVESTMENT TRUST,
INCLUDING THE FEDERAL, STATE, LOCAL, AND FOREIGN INCOME AND OTHER TAX
CONSEQUENCES OF SUCH PURCHASE, OWNERSHIP, SALE AND ELECTION, AND OF POTENTIAL
CHANGES IN APPLICABLE TAX LAWS.

TAXATION OF THE COMPANY

GENERAL

The REIT provisions of the Code are highly technical and complex. The
following sets forth the material aspects of the provisions of the Code that
govern the Federal income tax treatment of a REIT and its shareholders. This
summary is based on current U.S. law, including the applicable Code provisions,
rules and regulations promulgated thereunder, and administrative and judicial
interpretations thereof, all of which are subject to change which may apply
retroactively.

OPINION OF COUNSEL

The Company elected to be taxed as a REIT under the Code, commencing with
its taxable year ending December 31, 1994, and the Company intends to continue
to operate in a manner consistent with such election and all rules with which a
REIT must comply. Skadden, Arps, Slate, Meagher & Flom LLP, has issued its
opinion that, commencing with the Company's taxable year ended December 31,
1994, the Company was organized in conformity with the requirements for
qualification as a REIT, and its planned method of operation, and its actual
method of operation from February 12, 1994, will enable it to meet the
requirements for qualification and taxation as a REIT under the Code. In
addition, the Company will qualify as a REIT only if WPI qualifies as a REIT and
satisfies each of the requirements for qualification as a REIT as set forth
below in this section with respect to the Company. WPI will elect to be taxed as
a REIT under the Code commencing with its taxable year ended December 31, 1996,
and WPI intends to continue to operate in a manner consistent with such election
and all rules with which a REIT must comply. Skadden, Arps, Slate, Meagher &
Flom LLP, has issued its opinion that, commencing with WPI's taxable year ending
December 31, 1996, WPI was organized in conformity with the requirements for
qualification as a REIT, and its planned method of operation, and its actual
method of operation from January 1, 1996, will enable WPI to meet the
requirements for qualification and taxation as a REIT under the Code.

Each of the foregoing opinions are based and conditioned upon certain
assumptions and representations made by the Company and WPI as of the date
thereof regarding factual matters. The opinions are expressed as of the date
thereof, and Skadden, Arps, Slate, Meagher & Flom LLP will have no obligation to
advise holders of the Shares of any subsequent change in the matters stated,
represented or assumed or any subsequent change in the applicable law. Moreover,
such qualification and taxation as a REIT depends upon the Company and WPI
having met and continuing to meet through, among other things, actual annual
operating results, distribution levels and diversity of stock ownership, the
various qualification tests imposed under the Code as discussed below, the
results of which will not be reviewed by Skadden, Arps, Slate, Meagher & Flom
LLP. Accordingly, no assurance can be given that the actual results of the

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Company's and WPI's operations for any particular taxable year have satisfied or
will satisfy such requirements. See "--Failure to Qualify." An opinion of
counsel is not binding on the IRS, and no assurance can be given that the IRS
will not challenge the Company's and WPI's eligibility for taxation as a REIT.

TAXATION OF THE COMPANY

If the Company continues to qualify for taxation as a REIT, it generally
will not be subject to Federal corporate income tax on its net income that is
currently distributed to shareholders. This treatment substantially eliminates
the "double taxation" (at the corporate and shareholder levels) that generally
results from investment in a corporation. However, the Company will be subject
to Federal income tax as follows: First, the Company will be taxed at regular
corporate rates on any undistributed REIT taxable income, including
undistributed net capital gains. Second, under certain circumstances, the
Company may be subject to the "alternative minimum tax" on its items of tax
preference. Third, if the Company has net income from prohibited transactions
(which are, in general, certain sales or other dispositions of property, other
than certain foreclosure property, held primarily for sale to customers in the
ordinary course of business), such net income will be subject to a 100% tax.
Fourth, if the Company should fail to satisfy the 75% gross income test or the
95% gross income test (as discussed below), but has nonetheless maintained its
qualification as a REIT because certain other requirements have been met, it
will be subject to a 100% tax on an amount equal to (i) the gross income
attributable to the greater of the amount by which the Company fails the 75% or
95% test multiplied by (ii) a fraction intended to reflect the Company's
profitability. Fifth, if the Company should fail to distribute during each
calendar year at least the sum of (i) 85% of its REIT ordinary income for such
year, (ii) 95% of its REIT capital gain net income for such year, and (iii) any
undistributed taxable income from prior periods, the Company would be subjected
to a 4% excise tax on the excess of such required distribution over the amounts
actually distributed. Sixth, if during the ten-year period beginning on the
first day of the first taxable year for which the Company and WPI each qualified
as a REIT (the "Recognition Period"), the Company or WPI recognizes gain on the
disposition of any property (including, any partnership interest) held by the
Company or WPI or any partnership in which an interest was held as of the
beginning of such Recognition Period, then, to the extent of the excess of (i)
the fair market value of such property as of the beginning of such Recognition
Period over (ii) the adjusted tax basis of the Company or WPI or the
partnerships in such property as of the beginning of such Recognition Period
(the "Built-in Gain"), such gain will be subject to tax at the highest corporate
tax rate pursuant to IRS regulations that have not yet been promulgated.
Seventh, if the Company or WPI acquires any asset from a C corporation (I.E.,
generally a corporation subject to full corporate level tax) in a transaction in
which the adjusted tax basis of the asset in the hands of the Company or WPI is
determined by reference to the adjusted tax basis of the asset (or any other
property) in the hands of the C corporation, and the Company or WPI recognizes
gain on the disposition of such asset during the Recognition Period beginning on
the date on which such asset was acquired by the Company, then, to the extent of
the Built-in Gain, such gains will be subject to tax at the highest regular
corporate tax rate pursuant to IRS regulations that have not yet been
promulgated. In addition, the Company could also be subject to tax in certain
situations and on certain transactions not presently contemplated.

REQUIREMENTS FOR QUALIFICATION

The Code defines a REIT as a corporation, trust or association (i) that is
managed by one or more trustees or directors; (ii) the beneficial ownership of
which is evidenced by transferable shares, or by transferable certificates of
beneficial interest; (iii) which would be taxable as a domestic corporation, but
for the special Code provisions applicable to REITs; (iv) that is neither a
financial institution nor an insurance company subject to certain provisions of
the Code; (v) the beneficial ownership of which is held by 100 or more persons;
(vi) in which not more than 50% in value of the outstanding stock is owned,
directly or indirectly, by five or fewer individuals (as defined in the Code to
include certain entities); and (vii) which meets certain other tests described
below (including with respect to the nature of its income and assets). The Code
provides that conditions (i) through (iv) must be met during the entire taxable
year, that

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condition (v) must be met during at least 335 days of a taxable year of 12
months, or during a proportionate part of a taxable year of less than 12 months,
and that condition (vi) must be met during the last half of each taxable year.
The Company believes that it satisfies all of the conditions, including
conditions (v) and (vi) above. In order to comply with the share ownership tests
described in conditions (v) and (vi) above, the Articles provide certain
restrictions on the transfer of its capital stock to prevent concentration of
stock ownership. These restrictions may not ensure that the Company will, in all
cases, be able to satisfy the share ownership tests set forth above. If the
Company fails to satisfy such requirements, the Company's status as a REIT will
terminate.

To monitor the Company's compliance with the share ownership requirements,
the Company is required to maintain records regarding the actual ownership of
its shares. To do so, the Company must demand written statements each year from
the record holders of certain percentages of its stock in which the record
holders are to disclose the actual owners of the shares (I.E., the persons
required to include in gross income the REIT dividends). A list of those persons
failing or refusing to comply with this demand must be maintained as part of the
Company's records. A shareholder who fails or refuses to comply with the demand
must submit a statement with its U.S. Federal income tax return disclosing the
actual ownership of the shares and certain other information.

OWNERSHIP OF PARTNERSHIP INTERESTS

In the case of a REIT that is a partner in a partnership, regulations
provide that the REIT is deemed to own its proportionate share of the
partnership's assets and to earn its proportionate share of the partnership's
income. In addition, the assets and gross income of the partnership retain the
same character in the hands of the REIT for purposes of the gross income and
asset tests applicable to REITs as described below. Thus, the Company's
proportionate share of the assets, liabilities and items of income of the
partnership will be treated as assets, liabilities and items of income of the
Company for purposes of applying the REIT requirements described herein. A
summary of certain rules governing the Federal income taxation of partnerships
and their partners is provided below in "--Tax Aspects of the Company's
Investments in Partnerships."

INCOME TESTS

In order to maintain qualification as a REIT, the Company annually must
satisfy three gross income requirements. First, at least 75% of the Company's
gross income (excluding gross income from "prohibited transactions," I.E.,
certain sales of property held primarily for sale to customers in the ordinary
course of business) for each taxable year must be derived directly or indirectly
from investments relating to real property or mortgages on real property
(including "rents from real property" and, in certain circumstances, interest)
or from certain types of temporary investments. Second, at least 95% of the
Company's gross income (excluding gross income from prohibited transactions) for
each taxable year must be derived from such real property investments, and from
other dividends, interest and gain from the sale or disposition of stock or
securities (or from any combination of the foregoing). Third, short-term gain
from the sale or other disposition of stock or securities, gain from certain
sales of property held primarily for sale, and gain on the sale or other
disposition of real property held for less than four years (apart from
involuntary conversions and sales of foreclosure property) must, in the
aggregate, represent less than 30% of the Company's gross income for each
taxable year.

Rents received by the Company directly, through partnerships in which it has
a direct or indirect ownership interest (collectively, the "Partnerships"), or
through its wholly-owned subsidiary corporations ("qualified REIT subsidiaries,"
as described below) will qualify as "rents from real property" in satisfying the
gross income requirements described above, only if several conditions are met,
including the following. If rent attributable to personal property leased in
connection with a lease of real property is greater than 15% of the total rent
received under the lease, then the portion of rent attributable to such personal
property will not qualify as "rents from real property." Moreover, for rents
received to qualify as "rents from real property," the REIT generally must not
operate or manage the property or furnish or render services to the tenants of
such property, other than through an "independent contractor" from which the
REIT derives no revenue. However, the Company (or its affiliates) are permitted
to, and do directly

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perform services that are "usually or customarily rendered" in connection with
the rental of space for occupancy only and are not otherwise considered rendered
to the occupant of the property. Because certain Centers are managed by third
parties, the ability to treat amounts from such property as "rents from real
property" will be dependent on the actions of others and will not be within the
control of the Company. In addition, the Company generally may not and will not
charge rent that is based in whole or in part on the income or profits of any
person (except by reason of being based on a percentage of the tenant's gross
receipts or sales). Finally, rents derived from tenants that are at least 10%
owned, directly or constructively, by the Company or WPI do not qualify as
"rents from real property" for purposes of the gross income requirements. While
the Company regularly attempts to monitor such requirements, no assurance can be
given that the Company will not realize income that does not qualify as "rents
from real property," and that such amounts when combined with other
nonqualifying income, may exceed 5% of the Company's taxable income and thus
disqualify the Company as a REIT.

The Company has derived and continues to derive income from certain sources
that are not described above and that generally do not constitute qualifying
income for purposes of the gross income requirements. While no assurance can be
given that the IRS would not successfully assert otherwise, the Company believes
that the aggregate amount of such income in any taxable year will not exceed the
limits on non-qualifying income under the gross income tests.

If the Company fails to satisfy one or both of the 75% or 95% gross income
tests (though not the 30% gross income test) for any taxable year, it may
nevertheless qualify as a REIT for such year if it is entitled to relief under
certain provisions of the Code. These relief provisions will be generally
available if the Company's failure to meet such tests was due to reasonable
cause and not due to willful neglect, the Company attaches a schedule of the
sources of its income to its return, and any incorrect information on the
schedule was not due to fraud with intent to evade tax. It is not possible,
however, to state whether in all circumstances the Company would be entitled to
the benefit of these relief provisions. If these relief provisions are
inapplicable to a particular set of circumstances involving the Company, the
Company will not qualify as a REIT. As discussed above, even where these relief
provisions apply, a tax is imposed with respect to the excess of the actual
amount of non-qualifying income over the amount permitted under the gross income
tests.

ASSET TESTS

The Company, at the close of each quarter of its taxable year, must also
satisfy three tests relating to the nature of its assets. First, at least 75% of
the value of the Company's total assets must be represented by real estate
assets (including its allocable share of real estate assets held by the
Partnerships), stock in other REITs (such as WPI), stock or debt instruments
held for not more than one year purchased with the proceeds of a stock offering
or long-term (at least five years) debt offering of the Company, cash, cash
items and U.S. government securities. Second, not more than 25% of the Company's
total assets may be represented by securities other than those in the 75% asset
class. Third, of the investments included in the 25% asset class, the value of
any one issuer's securities owned by the Company may not exceed 5% of the value
of the Company's total assets, and the Company may not own more than 10% of any
one issuer's outstanding voting securities.

The Company's indirect interests in certain of the Partnerships and certain
properties are held through wholly owned corporate subsidiaries of the Company
organized and operated as "qualified REIT subsidiaries" within the meaning of
the Code. Qualified REIT subsidiaries are not treated as separate entities from
their parent REIT for Federal income tax purposes. Instead, all assets,
liabilities and items of income, deduction and credit of each qualified REIT
subsidiary are treated as assets, liabilities and items of the Company. Each
qualified REIT subsidiary therefore will not be subject to Federal corporate
income taxation, although it may be subject to state or local taxation.

In addition, the Company's ownership of stock of each qualified REIT
subsidiary and its interest in the Partnerships do not violate either the 5%
value restriction or the restriction against ownership of more than 10% of the
voting securities of any issuer. Similarly, the ownership by the Company of any
other REIT (such as WPI) will not violate these restrictions.

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WESTFIELD HOLDINGS WARRANTS

ASSET AND INCOME TESTS. The Westfield Holdings Warrants will be treated as
assets that fall within the 25% asset class for purposes of determining the
Company's compliance with the REIT asset tests discussed above. See "--Taxation
of the Company--Asset Tests." Accordingly, the value of the Westfield Holdings
Warrants owned by the Company generally may not exceed 5% of the Company's gross
assets ("Total Assets"), as determined in accordance with GAAP. The Company
believes that the value of the Westfield Holdings Warrants will not constitute
more than 5% of the Total Assets on the date such warrants are received by the
Company. Although the Total Assets must be revalued for purposes of the 5% asset
test at the end of any quarter in which any security is acquired, Treasury
regulations provide that the Company is not required to perform such a
revaluation with respect to the securities of any particular issuer at the end
of any quarter during which there has been no acquisition of any security of
that issuer. Therefore, the mere change in market value of a security held by
the Company will not, of itself, affect the status of the Company as a REIT.
Thus, although it is possible that subsequent fluctuations in the value of the
Westfield Holdings Warrants, the Total Assets, or both, could cause the value of
such warrants to exceed 5% of the Total Assets, such fluctuations should not
cause the Company to fail to meet the 5% asset test in the absence of an
acquisition of additional securities of Westfield Holdings by the Company during
such quarter. In addition, the Company's ability to realize upon the value of
the Westfield Holdings Warrants above certain thresholds may be limited by the
REIT gross income tests.

EXERCISE OF WARRANTS. It is possible that on the exercise date, the value
of the shares of Westfield Holdings Limited which the Company is entitled to
receive upon exercise of the Westfield Holdings Warrants would constitute more
than 5% of the Total Assets if such warrants were exercised in full. Because the
exercise of the Westfield Holdings Warrants will constitute the acquisition of
Westfield Holdings Limited shares, and such an exercise will necessitate a
revaluation of the Total Assets for purposes of determining the Company's
compliance with the 5% asset test, the terms of the Westfield Holdings Warrants
provide the Company with the right to exercise such warrants in whole or in
part. The Company will not retain the shares of Westfield Holdings Limited to
the extent that the Company determines that retention would cause the Company to
violate the 5% asset test. The Company's ability to sell such shares also may be
limited by the REIT gross income tests. Except as described below, no gain or
loss will be recognized by the Company upon exercise of the Westfield Holdings
Warrants for ordinary shares of Westfield Holdings Limited. The Company's
adjusted tax basis in the Westfield Holdings Limited shares received upon
exercise will equal the sum of the Company's adjusted tax basis in the Westfield
Holdings Warrants immediately prior to exercise plus the exercise price paid by
the Company.

Pursuant to the terms of the Westfield Holdings Warrants agreement, the
Company has the right to elect to exercise the option without making a cash
payment of the exercise price (a "Cashless Exercise"), in which event the
Company would be entitled to receive, at the option of Westfield Holdings
Limited, either the number of Westfield Holdings Limited ordinary shares equal
in value to, or cash in an amount equal to, the amount by which the then market
price of the ordinary shares of Westfield Holdings Limited exeeds the exercise
price of such options. If upon a Cashless Exercise, Westfield Holdings Limited
pays cash to the Company in lieu of issuing Westfield Holdings Limited shares,
the Company will recognize gain or loss equal to the difference between the
amount of cash received and the Company's adjusted tax basis in the Westfield
Holdings Warrants exercised. Any such gain or loss should be long-term capital
gain or loss.

The tax consequences of such a Cashless Exercise is uncertain where the
Company receives shares of Westfield Holdings Limited upon exercise. There is no
authority directly on point, and several alternative characterizations of the
Cashless Exercise are possible, including characterizations that could result in
short-term capital gains or dividend treatment.

LAPSE OF WARRANTS. The lapse or expiration without exercise of the
Westfield Holdings Warrants generally will result in a capital loss to the
Company equal to the Company's tax basis in such warrants, and this capital loss
will be a long-term capital loss if the holding period with respect to such
warrants is more than one year.

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BASIS AND HOLDING PERIOD OF WESTFIELD HOLDINGS LIMITED SHARES. Except in
the case where the Company makes a Cashless Exercise, (i) the Company's tax
basis in Westfield Holdings Limited shares received upon exercise of a Westfield
Holdings Warrant will equal the sum of the Company's tax basis in the exercised
warrants plus the cash paid upon exercise, and (ii) the holding period for
Westfield Holdings Limited shares received upon exercise of a Westfield Holdings
Warrant will begin on the date the warrant is exercised and will not include the
period during which the warrant was held.

As discussed above, the tax consequences to the Company of making a Cashless
Exercise (including the tax basis of Westfield Holdings Limited shares received
upon exercise) are uncertain. If, for example, a Cashless Exercise is treated as
if the withheld Westfield Holdings Limited shares are constructively issued and
then immediately redeemed for cash, then the adjusted tax basis in the Westfield
Holdings Limited shares actually received generally would equal the sum of the
Company's tax basis in the exercised warrants that is allocable to the Westfield
Holdings Limited shares actually received plus the exercise price deemed paid in
respect of such Westfield Holdings Limited shares actually received.

ADJUSTMENTS TO THE WESTFIELD HOLDINGS WARRANTS. Pursuant to the terms of
the Westfield Holdings Warrants, the Exercise Price and the number of Westfield
Holdings Limited ordinary shares purchasable upon exercise of the Westfield
Holdings Warrants is subject to adjustments from time to time upon the
occurrence of specified events. These adjustments should not be treated as a
taxable exchange of the Westfield Holdings Warrants to the extent that such
adjustments are pursuant to the original terms of the warrants. However, under
certain circumstances, a change in conversion ratio or any transaction having a
similar effect on the interest of the Company may be treated as a taxable
distribution if the Company's proportionate interest in the earnings and profits
of Westfield Holdings Limited is increased by such change or transaction (even
though no cash is received).

AUSTRALIAN WITHHOLDING TAX ON DIVIDENDS. Under the income tax convention
presently in force between Australia and the United States, dividends paid on
any Westfield Holdings Limited shares held by the Company may be subject to a
15% Australian withholding tax.

ANNUAL DISTRIBUTION REQUIREMENTS

In order to qualify as a REIT, the Company is required to distribute
dividends (other than capital gain dividends) to its shareholders in an amount
at least equal to (i) the sum of (a) 95% of the Company's "REIT taxable income"
(computed without regard to the dividends paid deduction and the Company's net
capital gain) and (b) 95% of the net income (after tax), if any, from
foreclosure property, minus (ii) the sum of certain items of noncash income.
Such distributions must be paid in the taxable year to which they relate, or in
the following taxable year if declared before the Company timely files its tax
return for such year and if paid with or before the first regular dividend
payment after such declaration. To the extent that the Company does not
distribute all of its net capital gain or distributes at least 95%, but less
than 100%, of its "REIT taxable income," as adjusted, it will be subject to tax
thereon at the capital gains or ordinary corporate tax rates, as the case may
be. Furthermore, if the Company should fail to distribute during each calendar
year at least the sum of (i) 85% of its REIT ordinary income for such year, (ii)
95% of its REIT capital gain income for such year, and (iii) any undistributed
taxable income from prior periods, the Company would be subject to a 4% excise
tax on the excess of such required distribution over the amounts actually
distributed. The Company believes that it has made, and intends to make, timely
distributions sufficient to satisfy this annual distribution requirement.

It is possible that the Company, from time to time, may not have sufficient
cash or other liquid assets to meet the 95% distribution requirement due to
timing differences between (i) the actual receipt of income and actual payment
of deductible expenses and (ii) the inclusion of such income and deduction of
such expenses in arriving at the Company's REIT taxable income. In the event
that such timing differences occur, in order to meet the 95% distribution
requirement, the Company may find it necessary to arrange for short-term, or
possibly long-term, borrowings (on terms that may not be favorable to the
Company) or to pay dividends in the form of taxable distributions of property.

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Under certain circumstances, the Code permits the Company to rectify a
failure to meet the distribution requirement for a year by paying "deficiency
dividends" to shareholders in a later year, which may be included in the
Company's deduction for dividends paid for the earlier year. Thus, the Company
may avoid being taxed on amounts distributed as deficiency dividends. The
Company would, however, be required to pay interest based on the amount of any
deduction taken for deficiency dividends.

ABSENCE OF EARNINGS AND PROFITS

The Code provides that, in the case of a corporation such as the Company
that was formerly a taxable C corporation, it may qualify as a REIT for a
taxable year only if, as of the close of the such year, it has no "earnings and
profits" accumulated in any non-REIT year. This requirement applies to each of
the Company and WPI. The Company and its former owners retained independent
certified public accountants to determine the Company's earnings and profits as
of February 11, 1994 (and, December 31, 1994) for purposes of the distribution
requirement. The determination by the independent certified public accountants
was based upon the Company's tax returns as filed with the IRS and other
assumptions and qualifications set forth in the reports issued by such
accountants. Based upon a report of certified public accountants, the Company
also believes that WPI has satisfied this requirement.

Any adjustments to the Company's or WPI's taxable income for taxable years
ending on or before the effective date of their respective REIT election,
including as a result of an examination of its returns by the IRS, could affect
the calculation of their respective earnings and profits as of the appropriate
measurement date. Furthermore, the determination of earnings and profits
requires the resolution of certain technical tax issues with respect to which
there is no authority directly on point and, consequently, the proper treatment
of these issues for earnings and profits purposes is not free from doubt. There
can be no assurance that the IRS will not examine the tax returns of the Company
or WPI for prior years and propose adjustments to increase its taxable income.
In this regard, the IRS can consider all taxable years of a corporation as open
for review for purposes of determining the amount of such earnings and profits.

FAILURE TO QUALIFY

If the Company fails to qualify for taxation as a REIT in any taxable year,
and the relief provisions do not apply, the Company will be subject to tax
(including any applicable alternative minimum tax) on its taxable income at
regular corporate rates. Distributions to shareholders in any year in which the
Company fails to qualify will not be deductible by the Company nor will they be
required to be made. In such event, to the extent of current and accumulated
earnings and profits, all distributions to shareholders will be taxable as
ordinary income, and, subject to certain limitations of the Code, corporate
distributees may be eligible for the dividends received deduction. Unless
entitled to relief under specific statutory provisions, the Company will also be
disqualified from taxation as a REIT for the four taxable years following the
year during which qualification was lost. It is not possible to state whether in
all circumstances the Company would be entitled to such statutory relief. In
addition, a recent Federal budget proposal contains language which, if enacted
in its present form, would result in the immediate taxation of all gain inherent
in a C corporation's assets upon an election by the corporation to become a
REIT, and thus would effectively preclude the Company from re-electing REIT
status following a termination of its REIT qualification.

TAX ASPECTS OF THE COMPANY'S INVESTMENTS IN PARTNERSHIPS

GENERAL

Certain of the Company's investments are held indirectly through
partnerships. In general, partnerships are "pass-through" entities that are not
subject to Federal income tax. Rather, partners are allocated their
proportionate shares of the items of income, gain, loss, deduction and credit of
a partnership, and are potentially subject to tax thereon, without regard to
whether the partners receive a distribution from the partnership. The Company
will include in its income its proportionate share of the foregoing partnership
items for purposes of the various REIT income tests and in the computation of
its REIT taxable income.

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Moreover, for purposes of the REIT asset tests, the Company will include its
proportionate share of assets held by such partnerships. See "--Taxation of the
Company--Ownership of Partnership Interests."

ENTITY CLASSIFICATION

The Company's direct and indirect investment in partnerships involves
special tax considerations, including the possibility of a challenge by the IRS
of the status of any of the partnerships as a partnership (as opposed to an
association taxable as a corporation) for Federal income tax purposes. If
certain of these entities were treated as an association for Federal income tax
purposes, it would be taxable as a corporation and therefore subject to an
entity-level tax on its income. In such a situation, the character of the
Company's assets and items of gross income would change, which could preclude
the Company from satisfying the asset tests and/or the income tests (see
"--Taxation of the Company--Asset Tests" and "--Taxation of the Company--Income
Tests"), and in turn could prevent the Company from qualifying as a REIT. See
"--Taxation of the Company--Failure to Qualify" above for a discussion of the
effect of the Company's failure to meet such tests for a taxable year. In
addition, any change in the status of any of the partnerships for tax purposes
might be treated as a taxable event, in which case the Company might incur a tax
liability without any related cash distributions.

TAX ALLOCATIONS WITH RESPECT TO THE PROPERTIES

Pursuant to the Code and the regulations thereunder, income, gain, loss and
deduction attributable to appreciated or depreciated property that is
contributed to a partnership in exchange for an interest in the partnership must
be allocated in a manner such that the contributing partner is charged with, or
benefits from, respectively, the unrealized gain or unrealized loss associated
with the property at the time of the contribution. The amount of such unrealized
gain or unrealized loss is generally equal to the difference between the fair
market value of contributed property at the time of contribution, and the
adjusted tax basis of such property at the time of contribution (a "Book-Tax
Difference"). Such allocations are solely for Federal income tax purposes and do
not affect the book capital accounts or other economic or legal arrangements
among the partners. Where a partner contributes cash to a partnership that holds
appreciated property, the Treasury regulations provide for a similar allocation
of such items to the other partners. These rules would apply to the contribution
by the Company to an existing partnership of the cash proceeds received in any
offerings of its stock.

With respect to any property purchased or to be purchased by any of the
partnerships (other than through the issuance of partnership units), such
property will initially have a tax basis equal to its fair market value and the
special allocation provisions described above will not apply.

SALE OF THE PROPERTIES

The Company's share of any gain realized by any partnership, in which it
holds a direct or indirect interest, on the sale of any property held as
inventory or primarily for sale to customers in the ordinary course of business
will be treated as income from a prohibited transaction that is subject to a
100% penalty tax. See "--Requirements for Qualification--Income Tests." Such
prohibited transaction income may also have an adverse effect on the Company's
ability to satisfy the income tests for status as a REIT. Under existing law,
whether property is held as inventory or primarily for sale to customers in the
ordinary course of a partnership's trade or business is a question of fact that
depends on all the facts and circumstances with respect to the particular
transaction. The Company intends to hold its interests in the subject
partnerships, and such partnerships intend to hold their properties for
investment with a view to long-term appreciation, to engage in the business of
acquiring, developing, owning, and operating the properties and to make such
occasional sales of the properties, including peripheral land, as are consistent
with the Company's investment objectives. Accordingly, the Company believes that
its interests in the subject partnerships, and such partnerships' interests in
the properties will not be treated as inventory or as property held primarily
for sale to customers in the ordinary course of a trade or business.

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TAXATION OF TAXABLE DOMESTIC SHAREHOLDERS

As long as the Company qualifies as a REIT, distributions made to the
Company's taxable domestic shareholders out of current or accumulated earnings
and profits (and not designated as capital gain dividends) will be taken into
account by them as ordinary income and will not be eligible for the dividends
received deduction for corporations. Distributions that are designated as
capital gain dividends will be taxed as long-term capital gain (to the extent
that they do not exceed the Company's actual net capital gain for the taxable
year) without regard to the period for which the shareholder has held its stock.
However, corporate shareholders may be required to treat up to 20% of certain
capital gain dividends as ordinary income.

Distributions in excess of current and accumulated earnings and profits will
not be taxable to a shareholder to the extent that they do not exceed the
adjusted tax basis of the shareholder's shares, but rather will reduce the
adjusted tax basis of such shares. To the extent that such distributions exceed
the adjusted tax basis of a shareholder's shares, they will be included in
income as long-term capital gain (or short-term capital gain if the shares have
been held for one year or less) provided that the shares are a capital asset in
the hands of the shareholder. In addition, any dividend declared by the Company
in October, November or December of any year and payable to a shareholder of
record on a specified date in any such month shall be treated as both paid by
the Company and received by the shareholder on December 31 of such year,
provided that the dividend is actually paid by the Company during January of the
following calendar year. Shareholders may not include in their individual income
tax returns any net operating losses or capital losses of the Company.

In general, any loss upon a sale or exchange of shares by a shareholder who
has held such shares for six months or less (after applying certain holding
period rules) will be treated as a long-term capital loss to the extent that
distributions from the Company are required to be treated by such shareholder as
long-term capital gain.

TAXATION OF TAX-EXEMPT SHAREHOLDERS

Based upon a published ruling by the IRS, distributions by the Company to a
shareholder that is a tax-exempt entity will not constitute "unrelated business
taxable income" ("UBTI"), provided that the tax-exempt entity has not financed
the acquisition of its shares with "acquisition indebtedness" within the meaning
of the Code and the shares are not otherwise used in an unrelated trade or
business of the tax-exempt entity.

Notwithstanding the preceding paragraph, however, a portion of the dividends
paid by the Company may be treated as UBTI to certain U.S. private pension
trusts if the Company is treated as a "pension-held REIT." The Company is not,
and does not expect to become, a "pension-held REIT." If the Company were to
become a pension-held REIT, these rules generally would only apply to certain
U.S. pension trusts that hold more than 10% of the Company's stock.

TAXATION OF FOREIGN SHAREHOLDERS

The following is a discussion of certain anticipated U.S. Federal income and
estate tax consequences of the ownership and disposition of the Company's stock
applicable to Non-U.S. Holders of such stock. A "Non-U.S. Holder" is any person
other than (i) a citizen or resident of the United States, (ii) a corporation or
partnership created or organized in the United States or under the laws of the
United States or of any state thereof, or (iii) an estate or trust whose income
is includable in gross income for U.S. Federal income tax purposes regardless of
its source. The discussion is based on current law and is for general
information only. The discussion addresses only certain and not all aspects of
U.S. Federal income and estate taxation.

ORDINARY DIVIDENDS

The portion of dividends received by Non-U.S. Holders payable out of the
Company's earnings and profits which are not attributable to capital gains of
the Company and which are not effectively connected

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with a U.S. trade or business of the Non-U.S. Holder will be subject to U.S.
withholding tax at the rate of 30% (or lower rate, if so provided by an
applicable income tax treaty). In general, Non-U.S. Holders will not be
considered engaged in a U.S. trade or business solely as a result of their
ownership of stock of the Company. In cases where the dividend income from a
Non-U.S. Holder's investment in stock of the Company is (or is treated as)
effectively connected with the Non-U.S. Holder's conduct of a U.S. trade or
business, the Non-U.S. Holder generally will be subject to U.S. tax at graduated
rates, in the same manner as U.S. shareholders are taxed with respect to such
dividends (and may also be subject to the 30% branch profits tax in the case of
a Non-U.S. Holder that is a foreign corporation).

NON-DIVIDEND DISTRIBUTIONS

Distributions by the Company to a Non-U.S. Holder who holds 5% or less of
the Common Stock (after application of certain constructive ownership rules)
which are not dividends out of the earnings and profits of the Company will not
be subject to U.S. income or withholding tax. If it cannot be determined at the
time a distribution is made whether or not such distribution will be in excess
of current and accumulated earnings and profits, the distribution will be
subject to withholding at the rate applicable to dividends. However, the
Non-U.S. Holder may seek a refund of such amounts from the IRS if it is
subsequently determined that such distribution was, in fact, in excess of
current and accumulated earnings and profits of the Company.

CAPITAL GAIN DIVIDENDS

Under the Foreign Investment in Real Property Tax Act of 1980 ("FIRPTA"), a
distribution made by the Company to a Non-U.S. Holder, to the extent
attributable to gains from dispositions of United States Real Property Interests
("USRPIs") such as the properties beneficially owned by the Company ("USRPI
Capital Gains"), will be considered to be income effectively connected with a
U.S. trade or business of the Non-U.S. Holder and subject to U.S. income tax at
the rate applicable to U.S. individuals or corporations, without regard to
whether such distribution is designated as a capital gain dividend. In addition,
the Company will be required to withhold tax equal to 35% of the amount of
dividends to the extent such dividends constitute USRPI Capital Gains.
Distributions subject to FIRPTA may also be subject to a 30% branch profits tax
in the hands of a foreign corporate shareholder that is not entitled to treaty
exemption.

DISPOSITION OF STOCK OF THE COMPANY

Unless the Company's stock constitutes a USRPI, a sale of such stock by a
Non-U.S. Holder generally will not be subject to U.S. taxation under FIRPTA. The
stock will not constitute a USRPI if the Company is a "domestically controlled
REIT." A domestically controlled REIT is a REIT in which, at all times during a
specified testing period, less than 50% in value of its shares is held directly
or indirectly by Non-U.S. Holders. Immediately following the Offerings, the
Company will not be a domestically controlled REIT. A Non-U.S. Holder's sale of
stock generally nevertheless will not be subject to tax under FIRPTA as a sale
of a USRPI provided that (i) the stock is "regularly traded" (as defined by
applicable Treasury regulations) on an established securities market (e.g., the
NYSE, on which the regularly traded Common Stock will be listed) and (ii) the
selling Non-U.S. Holder (after application of certain constructive ownership
rules) held 5% or less of the Company's outstanding stock or the regularly
traded class at all times during a specified testing period.

If gain on the sale of stock of the Company were subject to taxation under
FIRPTA, the Non-U.S. Holder would be subject to the same treatment as a U.S.
shareholder with respect to such gain (subject to applicable alternative minimum
tax and a special alternative minimum tax in the case of nonresident alien
individuals) and the purchaser of the stock could be required to withhold 10% of
the purchase price and remit such amount to the IRS.

Capital gains not subject to FIRPTA will nonetheless be taxable in the
United States to a Non-U.S. Holder in two cases: (i) if the Non-U.S. Holder's
investment in the stock of the Company is effectively connected with a U.S.
trade or business conducted by such Non-U.S. holder, the Non-U.S. Holder will be

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subject to the same treatment as a U.S. shareholder with respect to such gain,
or (ii) if the Non-U.S. Holder is a nonresident alien individual who was present
in the United States for 183 days or more during the taxable year and has a "tax
home" in the United States, the nonresident alien individual will be subject to
a 30% tax on the individual's capital gain.

ESTATE TAX

Stock of the Company owned or treated as owned by an individual who is not a
citizen or resident (as specially defined for U.S. Federal estate tax purposes)
of the United States at the time of death will be includable in the individual's
gross estate for U.S. Federal estate tax purposes, unless an applicable estate
tax treaty provides otherwise. Such individual's estate may be subject to U.S.
Federal estate tax on the property includable in the estate for U.S. Federal
estate tax purposes.

INFORMATION REPORTING AND BACKUP WITHHOLDING

U.S. SHAREHOLDERS

The Company will report to the U.S. Shareholders and the IRS the amount of
distributions paid during each calendar year and the amount of tax withheld, if
any. Under the backup withholding rules, a U.S. Shareholder may be subject to
backup withholding at the rate of 31% with respect to distributions paid unless
such holder (i) is a corporation or comes within certain other exempt categories
and, when required, demonstrates this fact, or (ii) provides a taxpayer
identification number, certifies as to no loss of exemption from backup
withholding, and otherwise complies with applicable requirements of the backup
withholding rules. A U.S. Shareholder that does not provide the Company with his
correct taxpayer identification number may also be subject to penalties imposed
by the IRS. Any amount paid as backup withholding will be creditable against the
U.S. Shareholder's income tax liability. In addition, the Company may be
required to withhold a portion of capital gain distributions to any U.S.
Shareholders who fail to certify their nonforeign status to the Company. See
"Federal Income Tax Considerations--Taxation of Foreign Shareholders."

FOREIGN SHAREHOLDERS

The Company must report annually to the IRS and to each Non-U.S. Holder the
amount of dividends (including any capital gain dividends) paid to, and the tax
withheld with respect to, such Non-U.S. Holder. These reporting requirements
apply regardless of whether withholding was reduced or eliminated by an
applicable tax treaty. Copies of these returns may also be made available under
the provisions of a specific treaty or agreement with the tax authorities in the
country in which the Non-U.S. Holder resides.

U.S. backup withholding (which generally is imposed at the rate of 31% on
certain payments to persons that fail to furnish the information required under
the U.S. information reporting requirements) and information reporting generally
will not apply to dividends (including any capital gain dividends) paid on stock
of the Company to a Non-U.S. Holder at an address outside the United States.

The payment of the proceeds from the disposition of stock of the Company to
or through a U.S. office of a broker will be subject to information reporting
and backup withholding unless the owner, under penalties of perjury, certifies,
among other things, its status as a Non-U.S. Holder, or otherwise establishes an
exemption. The payment of the proceeds from the disposition of stock to or
through a non-U.S. office of a non-U.S. broker generally will not be subject to
backup withholding and information reporting.

Backup withholding is not an additional tax. Any amounts withheld under the
backup withholding rules will be refunded or credited against the Non-U.S.
Holder's U.S. Federal income tax liability, provided that the required
information is furnished to the IRS.

These information reporting and backup withholding rules are under review by
the U.S. Treasury and their application to the Common Stock could be changed by
future regulations. On April 15, 1996, the IRS issued proposed Treasury
Regulations concerning the withholding of tax and reporting for certain amounts
paid to non-resident individuals and foreign corporations. The proposed Treasury
Regulations, if adopted

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in their present form, would be effective for payments made after December 31,
1997. Prospective purchasers should consult their tax advisors concerning the
potential adoption of such proposed Treasury Regulations and the potential
effect on their ownership of Common Stock.

OTHER TAX CONSEQUENCES

POSSIBLE LEGISLATIVE OR OTHER ACTIONS AFFECTING TAX CONSEQUENCES

Prospective investors should recognize that the present Federal income tax
treatment of an investment in the Company may be modified by legislative,
judicial or administrative action at any time, and that any such action may
affect investments and commitments previously made. The rules dealing with
Federal income taxation are constantly under review by persons involved in the
legislative process and by the IRS and the U.S. Treasury Department, resulting
in revisions of regulations and revised interpretations of established concepts
as well as statutory changes. Revisions in Federal tax laws and interpretations
thereof could adversely affect the tax consequences of an investment in the
Company. For example, a recent Federal budget proposal contains language which,
if enacted in its present form, would result in the immediate taxation of all
gain inherent in a C corporation's assets upon an election by the corporation to
become a REIT, and thus would effectively preclude the Company from re-electing
REIT status following a termination of its REIT qualification.

STATE AND LOCAL TAXES

The Company and its shareholders may be subject to state or local income and
other taxation in various state or local jurisdictions, including those in which
it or they transact business or reside. The state and local tax treatment of the
Company and its shareholders may not conform to the Federal income tax
consequences discussed above. Consequently, prospective shareholders should
consult their own tax advisors regarding the effect of state and local tax laws
on an investment in the Company.

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ERISA CONSIDERATIONS

A fiduciary of a pension, profit-sharing, retirement or other employee
benefit plan (the "Plan") subject to the Employee Retirement Income Security Act
of 1974, as amended ("ERISA") should consider the fiduciary standards under
ERISA in the context of the Plan's particular circumstances before authorizing
an investment in the Shares. Among other factors, the fiduciary should consider
whether such an investment is in accordance with the documents governing the
Plan and whether an investment is appropriate for the Plan in view of its
overall investment policy and the composition and diversification of its
portfolio. Other provisions of ERISA and the Code prohibit an employee benefit
plan from engaging in certain transactions involving "Plan assets" with parties
which are "parties in interest" under ERISA or "disqualified persons" under the
Code with respect to the Plan. Therefore, a fiduciary of a Plan should also
consider whether an investment in the Shares might constitute or give rise to a
prohibited transaction under ERISA and the Code.

If the assets of the Company were deemed to be Plan assets of employee
benefit Plans that are shareholders, the Plan's investment in the Shares might
be deemed to constitute a delegation under ERISA of the duty to manage Plan
assets by a fiduciary investing in Shares, and certain transactions involving
the operation of the Company might be deemed to constitute prohibited
transactions under ERISA and the Code.

The U.S. Department of Labor (the "DOL") has issued a final regulation with
regard to whether the underlying assets of an entity in which employee benefit
plans acquire equity interests would be deemed to be Plan assets. The regulation
provides that the underlying assets of an entity will not be considered to be
Plan assets if the equity interests acquired by employee benefit plans are
"publicly-offered securities" that is, they are (i) widely held (I.E., owned by
more than 100 investors), (ii) freely transferable and (iii) sold as part of an
offering pursuant to an effective registration statement under the Securities
Act and then timely registered under Section 12(b) or 12(g) of the Securities
Exchange Act of 1934, as amended. It is expected that the Shares will meet the
criteria of "publicly-offered securities" above. The Underwriters expect
(although no assurances can be given) that the Shares will be held by at least
100 independent investors at the conclusion of the Offerings; except as
discussed in "Description of Capital Stock--Restrictions on Transfer and Excess
Shares," there are no restrictions imposed on the transfer of the Shares and the
Shares will be sold as part of an offering pursuant to an effective registration
statement under the Securities Act, and then will be timely registered under the
Securities Exchange Act of 1934, as amended.

Due to the complexity of these rules and the penalties imposed upon persons
involved in prohibited transactions, it is important that an employee benefit
plan considering the purchase of Shares consult with its counsel regarding the
consequences under ERISA of the acquisition and ownership of Shares. Employee
benefit plans which are governmental plans (as defined in Section 3(32) of
ERISA) and certain church plans (as defined in Section 3(33) of ERISA) generally
are not subject to ERISA requirements. Individual retirement accounts and
certain employee benefit plans of self-employed individuals are subject to the
prohibited transaction provisions of the Code but not ERISA's fiduciary
standards.

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UNDERWRITING

The underwriters named below (the "U.S. Underwriters"), acting through their
respective representatives, Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch"), Furman Selz LLC, Goldman, Sachs & Co., Morgan Stanley & Co.
Incorporated, Prudential Securities Incorporated and Smith Barney Inc.
(collectively, the "U.S. Representatives" and, together with the International
Representatives, the "Representatives"), have severally agreed, subject to the
terms and conditions contained in a U.S. purchase agreement relating to the
Common Stock (the "U.S. Purchase Agreement") and concurrently with the sale of
2,700,000 shares of Common Stock to certain underwriters outside the United
States and Canada (the "International Managers" and, together with the U.S.
Underwriters, the "Underwriters"), to purchase from the Company the number of
shares of Common Stock set forth opposite their respective names below. Under
certain circumstances, the commitments of certain non-defaulting U.S.
Underwriters or International Managers may be increased.

<TABLE>
<CAPTION>
NUMBER
UNDERWRITER OF SHARES
------------
<S> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.................................................................... 1,900,000
Furman Selz LLC........................................................................... 1,900,000
Goldman, Sachs & Co....................................................................... 1,900,000
Morgan Stanley & Co. Incorporated......................................................... 1,900,000
Prudential Securities Incorporated........................................................ 1,900,000
Smith Barney Inc.......................................................................... 1,900,000
ABN AMRO Chicago Corporation.............................................................. 200,000
Alex. Brown & Sons Incorporated........................................................... 200,000
Dillon, Read & Co. Inc.................................................................... 200,000
Donaldson, Lufkin & Jenrette Securities Corporation....................................... 200,000
A.G. Edwards & Sons, Inc.................................................................. 200,000
Lehman Brothers Inc....................................................................... 200,000
PaineWebber Incorporated.................................................................. 200,000
Advest, Inc............................................................................... 100,000
Robert W. Baird & Co. Incorporated........................................................ 100,000
Craigie Incorporated...................................................................... 100,000
EVEREN Securities, Inc.................................................................... 100,000
Fahnestock & Co. Inc...................................................................... 100,000
Friedman, Billings, Ramsey & Co., Inc..................................................... 100,000
Gruntal & Co., Incorporated............................................................... 100,000
Interstate/Johnson Lane Corporation....................................................... 100,000
Janney Montgomery Scott Inc............................................................... 100,000
Jefferies & Company, Inc.................................................................. 100,000
Legg Mason Wood Walker, Incorporated...................................................... 100,000
McDonald & Company Securities, Inc........................................................ 100,000
Ragen MacKenzie Incorporated.............................................................. 100,000
Rauscher Pierce Refsnes, Inc.............................................................. 100,000
Raymond James & Associates, Inc........................................................... 100,000
The Robinson-Humphrey Company, Inc........................................................ 100,000
The Seidler Companies Incorporated........................................................ 100,000
Smith, Moore & Co......................................................................... 100,000
Stifel, Nicolaus & Company, Incorporated.................................................. 100,000
Sutro & Co. Incorporated.................................................................. 100,000
Tucker Anthony Incorporated............................................................... 100,000
Utendahl Capital Partners, L.P............................................................ 100,000
Van Kasper & Company...................................................................... 100,000
Wedbush Morgan Securities................................................................. 100,000
Wheat, First Securities, Inc.............................................................. 100,000
------------
Total........................................................................... 15,300,000
------------
------------
</TABLE>

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The Company has also entered into a purchase agreement (the "International
Purchase Agreement") with the International Managers. Subject to the terms and
conditions set forth in the International Purchase Agreement, and concurrently
with the sale of 15,300,000 shares of Common Stock to the U.S. Underwriters
pursuant to the U.S. Purchase Agreement, the Company has agreed to sell to the
International Managers, and the International Managers have severally agreed to
purchase from the Company, an aggregate of 2,700,000 shares of Common Stock. The
initial public offering price per share of the Common Stock and the total
underwriting discount per share of the Common Stock are identical under the U.S.
Purchase Agreement and the International Purchase Agreement.

In the U.S. Purchase Agreement and the International Purchase Agreement, the
U.S. Underwriters and the International Managers, respectively, have agreed,
subject to the terms and conditions set forth therein, to purchase all of the
shares of Common Stock being sold pursuant to each such Purchase Agreement if
any of such shares of Common Stock being sold pursuant to each such Purchase
Agreement are purchased. The closings with respect to the sale of the shares to
be purchased by the U.S. Underwriters and the International Managers are
conditioned upon one another.

The U.S. Underwriters and the International Managers have entered into an
intersyndicate agreement (the "Intersyndicate Agreement") that provides for the
coordination of their activities. Under the terms of the Intersyndicate
Agreement, the U.S. Underwriters and the International Managers are permitted to
sell shares of Common Stock to each other for purposes of resale at the initial
public offering price, less an amount not greater than the selling concession.
Under the terms of the Intersyndicate Agreement, the U.S. Underwriters and any
dealer to whom they sell shares of Common Stock will not offer to sell or sell
shares of Common Stock to persons who are non-United States or non-Canadian
persons or to persons they believe intend to resell to persons who are
non-United States or non-Canadian persons, and the International Managers and
any dealer to whom they sell shares of Common Stock will not offer to sell or
sell shares of Common Stock to United States or Canadian persons or to persons
they believe intend to resell to persons who are United States or Canadian
persons, except in each case for transactions pursuant to the Intersyndicate
Agreement.

The U.S. Representatives have advised the Company that the U.S. Underwriters
propose initially to offer the shares of Common Stock to the public at the
offering price set forth on the cover page of this Prospectus and to certain
dealers at such price less a concession not in excess of $.58 per share. The
U.S. Underwriters may allow, and such dealers may reallow, a discount not in
excess of $.10 per share on sales to certain other dealers. After the public
offering, the initial offering price, the concession and discount may be
changed.

The Company has granted to the U.S. Underwriters an option exercisable for a
period of 30 days from the date of this Prospectus to purchase up to an
additional 2,295,000 shares of Common Stock to cover over-allotments, if any, at
the initial offering price less the underwriting discount. If the U.S.
Underwriters exercise this option, each U.S. Underwriter will have a firm
commitment, subject to certain conditions, to purchase approximately the same
percentage thereof which the number of shares of Common Stock to be purchased by
it shown in the foregoing table bears to the 15,300,000 shares of Common Stock
initially offered hereby.

At the request of the Company, the U.S. Underwriters have reserved for sale,
at the initial public offering price, up to 5% of the shares to be sold and
offered hereby by the Company to certain employees, officers and family members
of such officers of U.S. affiliates of Westfield Holdings Limited. The number of
shares of Common Stock available for sale to the general public will be reduced
to the extent such persons purchase such reserved shares. Any reserved shares
which are not orally confirmed for purchase within one day of the pricing of the
Offerings will be offered by the U.S. Underwriters to the general public on the
same terms as the other shares offered hereby.

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utilize currently available cash or credit facilities to acquire such Common
Stock. Merrill Lynch will fill the Orders in their entirety even if the
Offerings are oversubscribed.

In the Purchase Agreements, the Company has agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act, or to contribute to payments the Underwriters may be required to
make in respect thereof.

The Company, Westfield Holdings, interests associated with the Lowy family
and Richard E. Green, a Co-President of the Company, will each agree, subject to
certain exceptions (including the issuance of the 1997 WAT Warrant and the
Series B Preferred Shares and the exercise of the WAT Warrants), not to (i)
sell, grant any option, right or warrant for the sale of, or to purchase or
otherwise transfer or dispose of any Common Stock or securities convertible into
or exchangeable or exercisable for Common Stock or file a registration statement
under the Securities Act with respect to the foregoing or (ii) enter into any
swap or other agreement or transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of ownership of the Common
Stock, for a period of 90 days from the date of this Prospectus in the case of
the Company and any Shares which may be acquired under the Orders and 36 months
from the date of this Prospectus in the case of shares held by Westfield
Holdings immediately prior to consummation of the Offerings, without the prior
written consent of Merrill Lynch. See "Shares Available for Future Sale."

The Underwriters have informed the Company that the Underwriters do not
intend to confirm sales accounts over which they exercise discretionary
authority in excess of 5%.

Prior to the Offerings, there has been no public market for the Common
Stock. The initial public offering price has been determined by negotiations
among the Company and the Underwriters. Among the factors considered in such
negotiations, in addition to the prevailing market conditions in the equity
securities market, the price at which the WAT units have been traded on the ASX,
dividend yields, price-earnings ratios and price-Funds from Operations ratios of
publicly traded REITs that the Company and the Underwriters believe to be
comparable to the Company, an assessment of the recent results of the operations
of the Company (which are based on the results of the operations of the
Properties), estimates of the future prospects of the Company, the present state
of the Company's development projects, the current state of the real estate
markets in the geographic area in which the Company operates and the economics
of the Company's principal markets as a whole. The initial public offering price
set forth on the cover page of this Prospectus should not, however, be
considered as indication of the actual value of the Common Stock. Such price is
subject to change as a result of market conditions and other factors. There can
be no assurance that an active trading market will develop for the Common Stock
or that the Common Stock will trade in the public market subsequent to the
Offerings at or above the initial offering price.

The Common Stock has been approved for listing on the NYSE, subject to
official notice of issuance, under the symbol "WEA." In order to meet the
requirements for listing of the Common Stock on such exchange, the Underwriters
have undertaken to sell lots of 100 or more shares to a minimum of 2,000
beneficial owners.

Until the distribution of the Common Stock is completed, rules of the
Commission may limit the ability of the Underwriters and certain selling group
members to bid for and purchase the Common Stock. As an exception to these
rules, the Representatives are permitted to engage in certain transactions that
stabilize the price of the Common Stock. Such transactions consist of bids or
purchases for the purpose of pegging, fixing or maintaining the price of the
Common Stock.

If the Underwriters create a short position in the Common Stock in
connection with the Offerings, i.e., if they sell more shares of Common Stock
than are set forth on the cover page of this Prospectus, the Representatives may
reduce that short position by purchasing Common Stock in the open market. The
Representatives may also elect to reduce any short position by exercising all or
part of the over-allotment options described above.

The Representatives may also impose a penalty bid on certain Underwriters
and selling group members. This means that if the Representatives purchase
shares of Common Stock in the open market to

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reduce the Underwriters' short position or to stabilize the price of the Common
Stock, they may reclaim the amount of the selling concession from the
Underwriters and selling group members who sold those shares as part of the
Offerings.

In general, purchases of a security for the purpose of stabilization or to
reduce a short position could cause the price of the security to be higher than
it might be in the absence of such purchases. The imposition of a penalty bid
might also have an effect on the price of a security to the extent that it were
to discourage resales of the security.

Neither the Company nor any of the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the Common Stock. In addition, neither
the Company nor any of the Underwriters makes any representation that the
Representatives will engage in such transactions or that such transactions, once
commenced, will not be discontinued without notice.

Roy Furman, the Vice Chairman of Furman Selz LLC, one of the U.S.
Representatives, is a director of the Company. Goldman, Sachs & Co., one of the
U.S. Representatives and an affiliate of Goldman Sachs International which is
one of the International Managers, is the owner and/or manager of several
investment funds that currently are investors in the Company and such investors
will receive a pro-rata portion of the Special Distribution.

In 1994, in connection with Prudential's sale of the Company to Westfield
Holdings and certain other investors, Prudential, an affiliate of Prudential
Securities Incorporated which is one of the U.S. Representatives and
Prudential-Bache Securities (U.K.) Inc. which is one of the International
Managers, made secured loans in the aggregate amount of $339.0 million to
certain subsidiaries of the Company. In 1996, these loans were increased by
$15.0 million to $354.0 million. See "Business and Properties--Debt Summary."
Under the terms of the loan agreement, Prudential is entitled to receive a
transfer fee of $1.77 million from the Company on such mortgage loan upon the
sale of the Company's Common Stock in an intial public offering. Upon
consummation of the Offerings, the Company will pay such fees to Prudential.

In 1995, Prudential made a $260.02 million secured loan to Westland Garden
State Plaza Limited Partnership, the owner of Garden State Plaza. In connection
with the making of the Garden State Plaza loan by the Company to Westfield
Holdings, Prudential is entitled to receive a transfer fee of $130,000. Upon
consummation of the Offerings, Westfield Holdings will pay such fee to
Prudential.

In the ordinary course of their business, certain of the Underwriters have
engaged in transactions with and performed services for the Company, Westfield
Holdings Limited and WAT and their respective subsidiaries for which they have
received customary fees.

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EXPERTS

The consolidated financial statements and schedules of the Company at
December 31, 1996 and for the year then ended included in this Prospectus and
Registration Statement have been audited by Ernst & Young LLP, independent
auditors, and at December 31, 1995 and for the year ended December 31, 1995 and
the periods from February 12, 1994 through December 31, 1994 and from January 1,
1994 through February 11, 1994, by Coopers & Lybrand LLP independent auditors,
as set forth in their respective reports thereon appearing elsewhere herein, and
included in reliance upon such reports given upon the authority of such firms as
experts in accounting and auditing.

The combined statements of revenues and certain expenses of the Acquired
Properties for the years ended June 30, 1996, 1995, and 1994, included in this
Prospectus and Registration Statement have been audited by BDO Seidman LLP,
independent auditors, as set forth in their report thereon appearing elsewhere
herein, and included in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.

The statement of revenue and certain expenses of Annapolis Mall for the year
ended December 31, 1996, included in the Prospectus and Registration Statement
have been audited by Ernst & Young LLP, independent auditors, as set forth in
their report thereon appearing elsewhere herein and included in reliance upon
such report given upon the authority of such firm as experts in accounting and
auditing.

LEGAL MATTERS

The validity of the issuance of the shares of Common Stock offered pursuant
to this Prospectus will be passed upon by Debevoise & Plimpton, New York, New
York on behalf of the Company, and certain legal matters and tax matters as
described under "Federal Income Tax Considerations" will be passed upon by
Skadden, Arps, Slate, Meagher & Flom LLP, Los Angeles, California. Certain legal
matters related to the Offerings will be passed upon for the Underwriters by
Skadden, Arps, Slate, Meagher & Flom LLP, Los Angeles, California. Debevoise &
Plimpton will rely upon the opinion of Bryan Cave LLP, as to matters of Missouri
law.

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement (of which this Prospectus is a part) on
Form S-11 under the Securities Act with respect to the securities offered
hereby. This Prospectus does not contain all the information set forth in the
Registration Statement, certain portions of which have been omitted as permitted
by the rules and regulations of the Commission. Statements contained in this
Prospectus as to the content of any contract or other document are not
necessarily complete, and in each instance reference is made to the copy of such
contract or other document filed as an exhibit to the Registration Statement,
each such statement being qualified in all respects by such reference and the
exhibits and schedules hereto. For further information regarding the Company and
the shares offered hereby, reference is hereby made to the Registration
Statement and such exhibits and schedules.

The Registration Statement, the exhibits and schedules forming a part
thereof filed by the Company with the Commission can be inspected and copies
obtained from the Commission at Room 1204, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the following regional offices of the
Commission: 7 World Trade Center, 13th Floor, New York, New York 10048 and 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such
material can be obtained from the Public Reference Section of the Commission,
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The
Commission also maintains a site on the world web at http://www.sec.gov that
contains information filed electronically by the Company.

The Company intends to furnish its shareholders with annual reports
containing consolidated financial statements audited by its independent
certified public accountants and with quarterly reports containing unaudited
condensed consolidated financial statements for each of the first three quarters
of each fiscal year.

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GLOSSARY

Unless the context otherwise requires, the following terms shall have the
meanings set forth below for the purposes of this Prospectus:

"ABP" means Stichting Pensioenfonds ABP, a Dutch pension fund established
under the laws of the Kingdom of the Netherlands.

"ACCREDITED INVESTOR" has the meaning defined in Rule 501 under the
Securities Act.

"ACQUISITION" means the 1994 acquisition of the Company from Prudential by
Westfield Holdings and certain other investors.

"ACQUIRED PROPERTIES" means Connecticut Post Mall, Trumbull Shopping Park
and South Shore Mall.

"ACQUISITION TRANSACTION" means the transaction in which a person or entity
became an Interested Shareholder.

"ADA" means the Americans with Disabilities Act of 1990.

"ADVISOR" means Westfield U.S. Advisory, L.P., a Delaware limited
partnership wholly-owned by Westfield Holdings that provides advisory services
to the Company.

"ADVISORY AGREEMENT" means the agreement dated July 1, 1996 as amended
between the Advisor and the Company.

"ADVISORY FFO AMOUNT" means, as of the date of, and after giving effect to,
the Offerings and concurrent transactions, an amount equal to $111.5 million.
After any New Issuance, the Advisory FFO Amount shall be the sum of the then
applicable Advisory FFO Amount and the FFO Adjustment Factor.

"ANCHOR" means the Centers' full line department stores or other large
retail stores generally occupying more than 50,000 square feet or a large
entertainment complex.

"ANNAPOLIS ACQUISITION" means the proposed acquisition by the Company to
purchase the remaining 70% interest in Annapolis Mall, together with an
adjoining parcel of real property leased to Montgomery Ward & Co., for an
aggregate purchase price of $133.0 million.

"ARTICLES" mean the Third Restated Articles of Incorporation of the Company
as in effect upon consummation of the Offerings.

"ASX" means the Australian Stock Exchange Limited.

"BANKRUPTCY CODE" means the United States Bankruptcy Code, codified at 11
U.S.C. SectionSection 101-1330, as amended.

"BASE RENT PER SQUARE FOOT (PSF)" means, when referring to the Centers, the
minimum or base rent per square foot payable by Mall Store tenants under leases
at the Centers excluding outparcels.

"BIG BOX RETAILER" means a discount retailer similar to a Category Killer,
but with a wider product offering, e.g. Loehmann's and Michael's.

"BOARD OF DIRECTORS" means the board of directors of the Company.

"BOOK-TAX DIFFERENCE" means the unrealized gain or loss equal to the
difference between the fair market value, at the time of contribution, of
property contributed to a partnership in exchange for a partnership interest and
the adjusted tax basis of such property at the time of contribution.

"BUILT-IN GAIN" means the difference between the fair market value and the
adjusted basis of a Property as of the beginning of the Recognition Period.

"BUILT-IN GAIN RULES" mean guidelines issued by the IRS relating to taxation
of Built-in Gain in IRS Notice 88-19.

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"BUSINESS COMBINATION" means, for purposes of the Missouri Business
Combination Statute, any person or entity which beneficially owns or controls
20% or more of the outstanding voting shares of the Company.

"BY-LAWS" means the Second Amended and Restated By-Laws of the Company as in
effect upon consummation of the Offerings.

"CASHLESS EXERCISE" means that the Company, pursuant to the terms of the
Westfield Holdings Warrants, elected to apply a number of shares of Westfield
Holdings Limited that otherwise would be issuable upon exercise of the Westfield
Holdings Warrants toward payment of the exercise price.

"BUSINESS COMBINATION" includes, for the purpose of the purposes of the
Missouri Business Combination Statute, a merger or consolidation, certain sales,
leases, exchanges, pledges and similar dispositions of corporate stock and
certain reclassifications and recapitalizations.

"CATEGORY KILLER" means a discount retailer in a specific product niche,
e.g., Toys R' Us.

"CENTERS" means the 19 Regional Centers and three Power Centers.

"CODE" means the United States Internal Revenue Code of 1986, as amended.

"COMMISSION" means the United States Securities and Exchange Commission.
"COMMON STOCK" means the common stock, par value $.01 per share, of the
Company.

"COMMON SHARES" means the Common Stock and the Excess Common Shares.

"COMPANY" means Westfield America, Inc., a Missouri corporation, together
with each of its subsidiaries and Joint Venture interests.

"CONCURRENT TRANSACTIONS" means the sale of the 1997 WAT Warrant by the
Company to WAT, the sale of the Series B Preferred Shares by the Company to ABP
and the exercise by certain existing investors of ordinary options granted by
WAT to exchange 1,623,985 shares of Common Stock for 32,479,700 units in WAT.

"DEVELOPER" means Westfield Corporation, Inc., a Delaware corporation and a
wholly-owned subsidiary of Westfield Holdings Limited that provides development
services to the Company.

"DOL" means the United States Department of Labor.

"EBITDA" means the Company's share of net income before interest, taxes,
depreciation and amortization.

"EFFECTIVE RENT PER SQUARE (PSF)" means, when referring to the Centers, the
minimum or base rent per square foot plus percentage rent per square foot
payable by Mall Store tenants under leases at the Centers excluding outparcels.

"ERISA" means the United States Employee Retirement Income Security Act of
1974, as amended.

"EXCESS COMMON SHARES" means shares of Common Stock owned, or deemed to be
owned, or transferred to a shareholder in excess of the Ownership Limit.

"EXCESS PREFERRED SHARES" means shares of Preferred Stock owned, or deemed
to be owned, or transferred to a shareholder in excess of the Ownership Limit.

"EXCESS SHARES" means the Excess Common Shares and the Excess Preferred
Shares.

"EXCHANGE ACT" means the Securities Exchange Act of 1934.

"FIRPTA" means the United States Foreign Investment in Real Property Tax Act
of 1980, as amended.

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"FULLY DILUTED" means with respect to the Company, the ownership of Common
Stock assuming the exercise of the WAT Warrants and with respect to WAT, the
ownership of units in WAT assuming the exercise of certain options to acquire
additional units in WAT.

"FFO ADJUSTMENT FACTOR" means 103% (except that 100% shall be used with
respect to Common Stock issued under any distribution reinvestment plan adopted
by the Company) multipled by (a) a fraction the numerator of which is the
aggregate Funds from Operations Available for Common Stock of the Company for
each of the four full calendar quarters immediately preceeding the date of the
New Issuance and the denominator of which is the aggregate number of shares of
Common Stock (on a fully diluted basis as required by GAAP) of the Company then
outstanding immediately prior to the date of the New Issuance multipled by (b)
the number of shares of Common Stock issued in the New Issuance (on a fully
diluted basis as required by GAAP).

"FUNDS FROM OPERATIONS" means net income (loss) (computed in accordance with
GAAP) excluding gains (or losses) from debt restructurings and sales of
property, plus real estate related depreciation and amortization and after
adjustments for unconsolidated partnerships and joint ventures except for years
ended December 31, 1993 and 1992 for which income taxes are not included. This
definition is in accordance with standards established by the White Paper on
Funds from Operations approved by the Board of Governors of NAREIT in March
1995.

"FUNDS FROM OPERATIONS AVAILABLE FOR COMMON STOCK" means Funds from
Operations less dividends paid or accrued on the preferred shares during the
applicable four full calendar quarter period.

"GAAP" means generally accepted accounting principles in the United States.

"GARDEN STATE PLAZA LOAN" means the $145.0 million participating secured
loan that will be made by the Company to Westfield Holdings, secured by a pledge
of a 50% partnership interest in the limited partnership that owns Garden State
Plaza.

"GARDEN STATE PLAZA OPTION" means the Company's option to acquire an
indirect 50% interest in Garden State Plaza at fair market value.

"GBCL" means Chapter 351 of the Revised Statutes of Missouri, entitled The
General Business and Corporation Law of Missouri.

"ICSC" means the International Council of Shopping Centers.

"INCOME TESTS" means three requirements relating to the Company's gross
income that must be satisfied annually for qualification as a REIT: (i) at least
75% of the Company's gross income (excluding gross income from prohibited
transactions) for each taxable year must be derived directly or indirectly from
investments relating to real property or mortgages on real property (including
"rents from real property" (as defined by the Code) and, in certain
circumstances, interest) or from certain types of temporary investments; (ii) at
least 95% of the Company's gross income (excluding gross income from prohibited
transactions) for each taxable year must be derived from such real property
investments, and from other dividends, interest and gain from the sale or
disposition of stock or securities (or from any combination of the foregoing);
and (iii) short-term gain from the sale or other disposition of stock or
securities, gain from certain sales of property held primarily for sale, and
gain on the sale or other disposition of real property held for less than four
years (apart from involuntary conversions and sales of foreclosure property)
must, in the aggregate, represent less than 30% of the Company's gross income
for each taxable year.

"INDEPENDENT DIRECTORS" means those members of the Board of Directors who
(i) are not, and have not for the last 12 months been, directors, officers or
employees of Westfield Holdings or the WAT Trustee, (ii) is not an affiliate of
Westfield Holdings or the WAT Trustee or an officer or employee of such an
affiliate, (iii) are not members of the immediate family of any natural person
described in clause (i) or (ii) above and (iv) are free from any relationship
that would interfere with the exercise of independent judgment as a director.

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"INDIVIDUAL" means an individual and certain entities as provided in Section
542(a)(2) of the Code.

"INTERESTED SHAREHOLDER" includes, for the purposes of the Missouri Business
Combination Statute, any person or entity which beneficially owns or controls
20% or more of the outstanding voting shares of the Company.

"INTERNATIONAL MANAGERS" means the International Managers named in the
International Prospectus.
"INTERNATIONAL OFFERING" means the offering of 2,700,000 Shares offered
initially outside the United States and Canada by the International Managers.

"INTERNATIONAL PROSPECTUS" means the prospectus to be used in connection
with the International Offering.

"INTERNATIONAL PURCHASE AGREEMENT" means the purchase agreement between the
International Managers and the Company.

"INTERNATIONAL REPRESENTATIVES" means Merrill Lynch International, Furman
Selz, Goldman Sachs International, Morgan Stanley & Co. International,
Prudential-Bache Securities (U.K.) Inc. and Smith Barney Inc.

"INTERSYNDICATE AGREEMENT" means the agreement between the International
Managers and the U.S. Underwriters, providing for the coordination of their
activities.

"IRS" means the United States Internal Revenue Service.

"JOINT VENTURE CENTERS" means, collectively, the seven Regional Centers and
one Power Center owned or ground leased by Joint Ventures (partnership interests
which are owned by the Company and the Joint Venture partners), and includes:
Annapolis Mall, Annapolis, Maryland; Meriden Square, Meriden, Connecticut;
Mission Valley Center, San Diego, California; Mission Valley Center-West, San
Diego, California; North County Fair, Escondido, California; Plaza Camino Real,
Carlsbad, California; Topanga Plaza, Canoga Park, California and Vancouver Mall,
Vancouver, Washington.*

"JOINT VENTURES" means, collectively, the partnerships through which the
Company owns interests in Annapolis Mall, Meriden Square, Mission Valley Center,
Mission Valley Center-West, North County Fair, Plaza Camino Real, Topanga Plaza,
Vancouver Mall, the land adjacent to Topanga Plaza known as West Valley and
certain other real estate interests.

"MALL GLA" means gross leasable area for Mall Stores.

"MALL STORES" means stores smaller than Anchors and kiosks permanently
located within the corridors of the Centers that are typically specialty
retailers and free standing buildings generally located along the perimeter of a
Center's parking area.

"MANAGEMENT AGREEMENTS" mean the separate management agreements, as amended,
between the Company and the Manager, relating to the management of the
Properties (other than North County Fair).

"MANAGER" means CenterMark Management Company, a Delaware limited
partnership wholly owned by Westfield Holdings that provides management services
to the Centers (other than North County Fair).

"MASTER DEVELOPMENT FRAMEWORK AGREEMENT" means the Master Development
Framework Agreement, dated July 1, 1996, as amended, between the Company and the
Developer.

"MAY COMPANY" means The May Department Stores Company, a New York
corporation.

"MAY PROPERTIES" means the 13 department store properties, located at
Springfield, Missouri; Salem, Oregon; Waterbury, Connecticut; Elyria, Ohio; and
Oxnard, West Los Angeles, Westminster, San Bernardino, El Cajon, Redondo Beach,
Costa Mesa, Riverside and Buena Park, California, in each case currently

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

*The Company has signed a letter of intent with its Joint Venture partner to
acquire the remaining 70% interest in Annapolis Mall.

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owned or ground leased by the Company, together with the department store
facility on each, which is net leased, to the May Company or assignees until
2017.

"MERRILL LYNCH" means Merrill Lynch, Pierce, Fenner & Smith Incorporated.

"MISSION VALLEY PARTNERSHIP" means the Joint Venture that owns Mission
Valley Center and Mission Valley Center--West.

"NAREIT" means the National Association of Real Estate Investment Trusts.

"NASD" means the National Association of Securities Dealers, Inc.

"NEW ISSUANCE" means any additional issuance by the Company of Common Stock.

"NON-U.S. SHAREHOLDERS" means nonresident alien individuals, foreign
corporations, foreign partnerships and other foreign shareholders.

"NOTICE 88-19" means the notice issued by the IRS which generally permits a
REIT to elect to defer recognition of Built-In Gain if certain conditions are
met.

"NYSE" means the New York Stock Exchange.

"OFFERINGS" means the offering of Shares pursuant to the U.S. Offering and
the International Offering.

"ORDER" means the orders placed by Westfield Holdings, interests associated
with the Lowy family and Richard E. Green, a Co-President of the Company, to
purchase 2,300,000, 600,000 and 100,000 Shares, respectively, at the price to
public in the Offerings.

"OPERATING PARTNERSHIP" means Westfield America, L.P., which the Company
intends to form following the consummation of the Offerings and prior to January
1, 1998.

"OUTPARCELS" means one or more free standing buildings generally located
along the perimeter of a Center's parking area.

"OUTSIDE PARTNERS" means one or more individuals or entities having no
interest in the Company or Westfield Holdings which are partners with the
Company in one or more of the Joint Ventures.

"OWNERSHIP LIMIT" means 5.5%, by value, of the outstanding capital stock
held directly or indirectly by any individual (except for Frank P. Lowy and the
members of his family, who are prohibited from owning directly or indirectly
more than 26.0% of the outstanding capital stock of the Company).

"PLAN" means a pension, profit sharing, retirement or other employee benefit
plan.

"PHASE I" means an investigation intended to identify areas or issues of
potential environmental concern with respect to a property conducted in
accordance with a standardized scope of work that directs the investigator to
investigate certain predetermined sources of information about environmental
conditions on and near the subject property, to examine the subject property and
to identify publicly known conditions in respect of properties in the vicinity
of the subject property that have had, might have had or might have
environmental impacts on the subject property.

"POWER CENTERS" means centers whose major tenants are large discount
department stores or Category Killers.

"POWER CENTERS" means Eastland Center, Mission Valley Center-West and
Westland Towne Center.

"PREFERRED SHARES" means the Preferred Stock, the Senior Preferred Shares
and the Excess Preferred Shares.

"PREFERRED STOCK" means the preferred stock, par value $1.00 per share, of
the Company of which 940,000 shares of Series A Preferred Shares and 270,000
shares of Series B Preferred Shares will be issued and outstanding upon the
closing of the Offerings and concurrent transactions.

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"PRIMARY TRADE AREA" means the geographic market from which a Center draws a
majority of its sales, as determined by the Company by taking into account
competing shopping centers, access, available sales data and on-site geographic
research.

"PROPERTIES" means, collectively, the respective interests of the Company as
applicable, in the Centers, the May Properties, the land adjacent to Topanga
Plaza known as West Valley and other minor real estate investments held directly
or indirectly by any of the foregoing entities.

"PRUDENTIAL" means The Prudential Insurance Company of America.

"PURCHASE AGREEMENTS" means the purchase agreements between the Company and
the Underwriters entered into in connection with the Offerings.

"PSF" means per square foot.

"QUALIFICATION DATE" means the first day of the first taxable year of which
an entity qualifies as a REIT (February 12, 1994 for the Company and January 1,
1996 for WPI).

"RANKING PREFERRED SHARES" means the Series A Preferred Shares or any series
of Preferred Shares authorized with the consent of the holders of Series A
Preferred Shares ranking PARI PASSU with the Series A Preferred Shares.

"RBC" means the risk based capital requirements of the National Association
of Insurance Commissioners governing regulatory capital.

"REA" means a reciprocal easement agreement.

"RECAPITALIZATION" means the series of transactions in 1996 and 1997 by
which WAT acquired a majority interest in the Company and other transactions.

"RECOGNITION PERIOD" means the recognition period pertaining to Built-In
Gain as defined in Notice 88-19.

"REGIONAL SHOPPING CENTERS" means mall facilities built around one or two
anchors and containing from 400,000 to 800,000 square feet of total gross
leasable area.

"REGIONAL CENTERS" means, collectively, the six regional and 13 super
regional shopping centers in which the Company has ownership interests.

"REGISTRATION RIGHTS AGREEMENT" means the agreement between Westfield
Holdings and the Company whereby Westfield Holdings will have the right, 12
months after the closing of the Offerings, to require the Company to promptly
effect the registration of their shares.

"REGULAR QUARTERLY DISTRIBUTION" means the regular quarterly distributions
payable by the Company during each fiscal year.

"REIT" means a real estate investment trust as defined pursuant to Sections
856 through 860 of the Code.

"REIT REQUIREMENTS" means the applicable Treasury Regulations relating to
REIT qualification.

"REPRESENTATIVES" means the U.S. Representatives and the International
Representatives.

"RESTRICTED SHARES" means the Common Stock owned by Westfield Holdings, WAT
and certain other investors which are subject to Rule 144.

"RULE 144" means the rule promulgated under the Securities Act that permits
holders of restricted securities as well as affiliates of an issuer of the
securities, pursuant to certain conditions and subject to certain restrictions,
to sell their securities publicly without registration under the Securities Act.

"SALES PER SQUARE FOOT" means when referring to the Centers, the sales per
square foot for Mall Stores at Stabilized Centers reporting sales for 12 months,
excluding North County Fair.

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"SECURITIES ACT" means the United States Securities Act of 1933, as amended.

"SENIOR PREFERRED SHARES" means the Company's senior non-voting preferred
stock, par value $1.00 per share.

"SERIES A PREFERRED SHARES" means a designated portion of the Company's
preferred stock, par value $1.00 per share.

"SERIES B PREFERRED SHARES" means a designated portion of the Company's
preferred stock, par value $1.00 per share, to be issued concurrently with the
Offerings.

"SHARES" means the shares of Common Stock issued in the Offerings.

"SPECIAL DISTRIBUTION" means the special distribution intended to be
declared and paid by the Company to the shareholders of the Company immediately
preceding the Closing of the Offerings in the amount of $13.0 million.

"STABILIZED CENTERS" means Centers (other than North County Fair) not under
redevelopment for the relevant period.

"SUPER REGIONAL SHOPPING CENTER" means mall facilities built around three or
more anchors and containing greater than 800,000 square feet of total gross
leasable area.

"TOTAL ASSETS" means the Company's gross assets as defined in accordance
with GAAP.

"TOTAL EBITDA" means the Company's total EBITDA before minority interest
plus its pro-rata shares of EBITDA of unconsolidated real estate partnerships.

"TOTAL GLA" means total gross leasable area, including Anchors and Mall
Stores at the Centers.

"TOTAL MARKET CAPITALIZATION" means the sum of (i) the aggregate market
value of the outstanding shares of Common Stock (based on the mid-point of the
range as set forth on the cover page of this Prospectus), plus (ii) the total
debt of the Company consolidated with the subsidiaries, including its
proportionate share of any indebtedness on property held by Joint Ventures plus
(iii) the total liquidation value of the Company's Preferred Shares.

"TRADE AREA POPULATION" means the number of people that reside in a
geographically defined area surrounding the shopping center that equates to
approximately 70% to 80% of the Centers' customer draw.

"TREASURY REGULATIONS" means the income tax regulations that have been
promulgated under the Code.

"TRUST DEED" means the trust deed dated March 28, 1996 pursuant to which WAT
was established.

"UBTI" means "unrelated business taxable income" as defined in Section
512(a) of the Code.

"UNDERWRITERS" means the U.S. Underwriters and the International Managers.

"U.S. OFFERING" means the offering of 15,300,000 shares Common Stock offered
initially in the United States and Canada by the U.S. Underwriters.

"U.S. PROSPECTUS" means the prospectus used in connection with the U.S.
Offering.

"U.S. PURCHASE AGREEMENT" means the purchase agreement between the Company
and the U.S. Underwriters.

"U.S. REPRESENTATIVES" means Merrill Lynch, Furman Selz LLC, Goldman, Sachs
& Co., Morgan Stanley & Co. Incorporated, Prudential Securities Incorporated and
Smith Barney Inc.

"U.S. UNDERWRITERS" means the U.S. Underwriters named in the U.S.
Prospectus.

"USRPIS" means United States Real Property Interests as defined at Section
897 of the Code.

G-7
<PAGE>
"WAM" means Westfield America Management Limited, a wholly-owned subsidiary
of Westfield Holdings that manages WAT.

"WAT" means Westfield America Trust.

"WAT OFFERING" means the offering of WAT Units to the Australian public
which closed on June 27, 1996.

"WAT TRUSTEE" means Perpetual Trustee Company Limited.

"WAT WARRANTS" means the 1996 WAT Warrant and the 1997 WAT Warrant.

"1996 WAT WARRANT" means the warrant acquired by WAT in July 1996 entitling
it to purchase, in whole or in part, 6,246,096 shares of Common Stock at the
exercise price of $16.01, subject to adjustment in certain events.

"1997 WAT WARRANT" means the warrant that will be issued by the Company to
WAT, in connection with the Offerings, entitling it to purchase, in whole or in
part, 2,089,552 shares of additional Common Stock at an exercise price of the
price to public set forth on the cover page of this Prospectus.

"WCI" means the Developer, Westfield Corporation, Inc., a Delaware
corporation and a wholly-owned subsidiary of Westfield Holdings Limited.

"WEST VALLEY PARTNERSHIP" means the limited partnership consisting of the
Company, as a general partner, and Outside Partners, as limited partners, which
owns the land adjacent to Topanga Plaza known as West Valley.

"WESTFIELD AMERICA TRUST" means an Australian public property trust listed
on the ASX.

"WESTFIELD HOLDINGS" means Westfield Holdings Limited and its subsidiaries.

"WESTFIELD HOLDINGS LIMITED" means Westfield Holdings Limited, an Australian
public corporation listed on the ASX.

"WESTFIELD HOLDINGS WARRANTS" means the options granted to the Company to
purchase 9.8 million ordinary shares of Westfield Holdings Limited.

"WESTFIELD TRUST" means an Australian publicly traded property unit trust
listed on the ASX and managed by Westfield Holdings.

"WESTLAND REALTY, INC" means a subsidiary of Westfield Holdings which holds
an indirect 50% partnership interest in the Garden State Plaza.

"WHEATON ACQUISITION" means the proposed acquisition by the Company of
approximately 70% of the partnership interests in Wheaton Plaza Regional
Shopping Center LLP, the entity that owns Wheaton Plaza Regional Shopping Center
located in Wheaton, Montgomery County, Maryland, for a purchase price of $52.5
million.

"WPI" means Westland Properties, Inc, a Delaware corporation.

G-8
<PAGE>
INDEX TO FINANCIAL STATEMENTS

<TABLE>
<S> <C>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES
Pro Forma Condensed Consolidated Financial Information (Unaudited):
Pro Forma Condensed Consolidated Balance Sheet as of March 31, 1997................ F-2
Pro Forma Condensed Consolidated Statements of Income for the three months ended
March 31, 1997 and the year ended December 31, 1996.............................. F-5

WESTFIELD AMERICA, INC. AND SUBSIDIARIES
Consolidated Financial Statements
Report of Independent Auditors..................................................... F-9
Report of Independent Auditors..................................................... F-10
Consolidated Balance Sheets as of March 31, 1997 (unaudited) December 31, 1996 and
1995............................................................................. F-11
Consolidated Statements of Income for the three months ended March 31, 1997 and
1996 (unaudited) and for the years ended December 31, 1996 and 1995, the period
from February 12, 1994 through December 31, 1994 and the period from January 1,
1994 through February 11, 1994................................................... F-12
Consolidated Statements of Changes in Shareholders' Equity for the three months
ended March 31, 1997 and 1996 (unaudited) and for the years ended December 31,
1996 and 1995, the period from February 12, 1994 through December 31, 1994 and
the period from January 1, 1994 through February 11, 1994........................ F-13
Consolidated Statements of Cash Flows for the three months ended March 31, 1997 and
1996 (unaudited) and for the years ended December 31, 1996 and 1995, the period
from February 12, 1994 through December 31, 1994 and the period from January 1,
1994 through February 11, 1994................................................... F-14
Notes to Consolidated Financial Statements......................................... F-16
Schedule III:
Real Estate Investment and Accumulated Depreciation................................ F-34
All other schedules have been omitted since the required information is either
included in the Consolidated Financial Statements, not present, or not present in
amounts sufficient to require submission of the schedule.

THE ACQUIRED PROPERTIES
Report of Independent Certified Public Accountants................................. F-35
Combined Statements of Revenues and Certain Expenses............................... F-36
Notes to Combined Statements of Revenues and Certain Expenses...................... F-37

ANNAPOLIS MALL (AN ENTITY FOR WHICH WESTFIELD AMERICA, INC. HAS A LETTER OF INTENT TO
ACQUIRE A 70% INTEREST)
Report of Independent Auditors..................................................... F-39
Statement of Revenues and Certain Expenses......................................... F-40
Notes to Statement of Revenues and Certain Expenses................................ F-41

GARDEN STATE PLAZA LIMITED PARTNERSHIP (THE OWNER OF GARDEN STATE PLAZA AND THE
ENTITY IN WHICH WESTFIELD AMERICA, INC. WILL HAVE AN INDIRECT 50% SECURITY INTEREST
IN BY WAY OF MAKING A $145 MILLION PARTICIPATING SECURED LOAN)
Report of Independent Certified Public Accountants................................. F-43
Statements of Revenues and Certain Expenses........................................ F-44
Notes to Statements of Revenues and Certain Expenses............................... F-45
</TABLE>

F-1
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

MARCH 31, 1997

(UNAUDITED)
(IN THOUSANDS)

The unaudited Pro Forma Condensed Consolidated Balance Sheet is presented as
if the net proceeds of Westfield America, Inc.'s (the "Company") initial public
offering of 18,000 shares of common stock par value $.01 per share (the "Common
Stock"), the sale of 270 shares of Series B Preferred Shares and the proceeds
from the Company's sale of the 1997 WAT Warrants were applied as described in
"Use of Proceeds" as of March 31, 1997, assuming for this purpose that (i) the
Outside Partner's interest in Annapolis Mall is acquired for $133,000, (ii) the
Wheaton Acquisition is made for $52,500, (iii) the Garden State Plaza Loan in
the amount of $145,000 is made, (iv) options to purchase ordinary shares are
purchased from Westfield Holdings Limited, an affiliate, for $15,300 (Aus. $19.6
million), (v) $74,977 is borrowed under the Company's unsecured line of credit,
(vi) the Common Stock is sold in the Offerings at an assumed price of $15.00 per
share, and the over-allotment options for the Offerings are not exercised, the
Series B Preferred Shares are issued and the 1997 WAT Warrants are sold and
(vii) the Company is recapitalized and the Acquired Properties are acquired as
of March 31, 1997 as described in Notes 1 and 9 to the Consolidated Financial
Statements.

The unaudited Pro Forma Condensed Consolidated Balance Sheet should be read
in conjunction with the Consolidated Financial Statements of Westfield America,
Inc. and Subsidiaries and Notes thereto included elsewhere herein. In the
Company's opinion, all adjustments necessary to reflect the effects of the
consummation of the Offerings, the application of the net proceeds therefrom and
from the concurrent transactions have been made.

The unaudited Pro Forma Condensed Consolidated Balance Sheet is not
necessarily indicative of what the actual financial position of the Company
would have been at March 31, 1997, nor does it purport to present the future
financial position of the Company.

F-2
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

MARCH 31, 1997

(UNAUDITED)
(IN THOUSANDS)

<TABLE>
<CAPTION>
MARCH 31, 1997
---------------------------------------
PRO FORMA PRO FORMA
HISTORICAL(A) ADJUSTMENTS CONSOLIDATED
------------ ----------- ------------
<S> <C> <C> <C>
ASSETS:
Net investment in real estate....................................... $ 1,305,462 $ 330,500(b) $1,635,962
Cash and cash equivalents........................................... 2,647 2,647
Tenant accounts receivable.......................................... 21,768 -- 21,768
Deferred expenses and other assets, net............................. 9,125 15,300(c) 24,425
------------ ----------- ------------
Total assets.................................................... $ 1,339,002 $ 345,800 $1,684,802
------------ ----------- ------------
------------ ----------- ------------
LIABILITIES:
Mortgage notes payable.............................................. $ 783,285 $ 74,977(d) $ 858,262
Accounts payable, accrued expenses and other liabilities............ 29,681 -- 29,681
Distribution payable................................................ 1,952 -- 1,952
Minority interest................................................... -- -- --
------------ ----------- ------------
Total liabilities 814,918 74,977 889,895
------------ ----------- ------------

SHAREHOLDERS' EQUITY:
Common stock........................................................ 529 180(e) 709
Preferred stock..................................................... 94,000 27,000(e) 121,000
Paid-in-capital..................................................... 424,001 243,643(e) 667,644
Retained earnings................................................... 5,554 -- 5,554
------------ ----------- ------------
Total equity........................................................ 524,084 270,823 794,907
------------ ----------- ------------
Total liabilities and shareholders' equity...................... $ 1,339,002 $ 345,800 $1,684,802
------------ ----------- ------------
------------ ----------- ------------
</TABLE>

NOTES (IN THOUSANDS)

(a) Reflects the Westfield America, Inc. and Subsidiaries Consolidated Balance
Sheet at March 31, 1997.

(b) Increase reflects

<TABLE>
<S> <C>
Garden State Plaza Loan....................................... $ 145,000
Annapolis Acquisition......................................... 133,000
Wheaton Acquisition........................................... 52,500
---------
$ 330,500
---------
---------
</TABLE>

(d) Increase reflects additional borrowing under the unsecured corporate line of
credit.

(e) Increase reflects the issuance of 18,000 shares of Common Stock, the 1997
WAT Warrant and 270 shares of Series B Preferred Shares (at its liquidation
amount) offset by $26,177 of estimated underwriting costs and other
expenses.

F-3
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND
FOR THE YEAR ENDED DECEMBER 31, 1996
(UNAUDITED)
(IN THOUSANDS)

The unaudited Pro Forma Condensed Consolidated Statements of Income are
presented as if the net proceeds of Westfield America, Inc.'s (the "Company")
initial public offering of 18,000 shares of common stock par value $0.01 per
share (the "Common Stock"), the sale of 270.0 shares of Series B Preferred
Shares and the proceeds from the Company's sale of the 1997 WAT Warrants were
applied as described in "Use of Proceeds" as of the beginning of the period
presented, assuming for this purpose that (i) the Outside Partner's interest in
Annapolis Mall is acquired for $133,000 (ii) the Wheaton Acquisition is made for
$52,500, (iii) the Garden State Plaza Loan in the amount of $145,000 is made,
(iv) options to purchase ordinary shares are purchased from Westfield Holdings
Limited, an affiliate, for $15,300 (Aus $19.6 million) (v) $74,977 is borrowed
under the Company's unsecured line of credit (vi) the Common Stock is sold in
the Offerings at an assumed price of $15.00 per share, and the over-allotment
option for the Offerings is not exercised, the Series B Preferred Shares and the
1997 WAT Warrants are sold and (vii) the Company is recapitalized and the
Acquired Properties are acquired as of January 1, 1996, as described in Notes 1
and 9 to the Consolidated Financial Statements.

The unaudited Pro Forma Condensed Consolidated Statement of Income should be
read in conjunction with the Consolidated Financial Statements of Westfield
America, Inc. and Subsidiaries and Notes thereto included elsewhere herein. In
the Company's opinion, all adjustments necessary to reflect the effects of the
consummation of the Offerings, the application of the net proceeds therefrom and
from the concurrent transactions, have been made.

The unaudited Pro Forma Condensed Consolidated Statement of Income is not
necessarily indicative of what the actual results of operations of the Company
would have been assuming the Offering and related application of net Offering
proceeds had been consummated as of the beginning of the year presented, nor do
they purport to present the future operations of the Company.

F-4
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT

FOR THE THREE MONTHS ENDED MARCH 31, 1997
(UNAUDITED)
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1997
---------------------------------------
PRO FORMA PRO FORMA
HISTORICAL(A) ADJUSTMENTS CONSOLIDATED
------------ ----------- ------------
<S> <C> <C> <C>
REVENUES:
Minimum rents and percentage rents.................................. $ 32,728 $ 6,899(b) $ 39,627
Tenant recoveries and service fee income............................ 14,175 2,232(b) 16,407
------------ ----------- ------------
Total revenue..................................................... 46,903 9,131 56,034
EXPENSES:
Operating........................................................... 14,763 2,337(b) 17,100
Management fees..................................................... 928 345(b) 1,273
Advisory fee (not payable) (c)...................................... -- -- (c) --
General and administrative.......................................... 236 -- 236
Depreciation and amortization....................................... 11,539 1,289(b) 12,828
------------ ----------- ------------
OPERATING INCOME...................................................... 19,437 5,160 24,597
Interest expense, net............................................... (12,860) (1,312)(d) (14,172)
Equity in income of unconsolidated real estate partnerships......... 1,293 (792)(e) 501
Interest and other income........................................... 312 3,325(f) 3,637
------------ ----------- ------------
Income before minority interest..................................... 8,182 6,381 14,563
Minority interest in earnings of unconsolidated real estate
partnerships...................................................... (218) (713)(g) (931)
------------ ----------- ------------
NET INCOME............................................................ $ 7,964 $ 5,667 $ 13,632
------------ ----------- ------------
------------ ----------- ------------
Income allocable to preferred shares................................ $ 1,998 $ 2,571
Income allocable to common shares................................... 5,966 11,061
------------ ------------
$ 7,964 $ 13,632
------------ ------------
------------ ------------
EARNINGS PER SHARE (H)................................................ $ 0.11 $ 0.16
------------ ------------
------------ ------------
</TABLE>

F-5
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT

FOR THE YEAR ENDED DECEMBER 31, 1996
(UNAUDITED)
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1996
---------------------------------------
PRO FORMA PRO FORMA
HISTORICAL(A) ADJUSTMENTS CONSOLIDATED
------------ ----------- ------------
<S> <C> <C> <C>
REVENUES:
Minimum rents and percentage rents.................................. $ 110,384 $ 45,534(b) $ 155,918
Tenant recoveries and service fee income............................ 45,705 18,449(b) 64,154
------------ ----------- ------------
Total revenue..................................................... 156,089 63,983 220,072
EXPENSES:
Operating........................................................... 49,000 22,783(b) 71,783
Management fees..................................................... 3,495 2,067(b) 5,562
Advisory fee (not payable) (c)...................................... 2,600 (2,600)(c) --
General and administrative.......................................... 808 -- 808
Depreciation and amortization....................................... 38,033 10,254(b) 48,287
------------ ----------- ------------
OPERATING INCOME...................................................... 62,153 31,479 93,632
Interest expense, net............................................... (40,233) (15,232)(d) (55,465)
Equity in income of unconsolidated real estate partnerships......... 3,063 (3,008)(e) 55
Interest and other income........................................... 776 12,736(f) 13,512
------------ ----------- ------------
Income before minority interest..................................... 25,759 25,975 51,734
Minority interest in earnings of unconsolidated real estate
partnerships...................................................... (1,063) (1,943)(g) (3,006)
------------ ----------- ------------
NET INCOME............................................................ $ 24,696 $ 24,082 $ 48,728
------------ ----------- ------------
------------ ----------- ------------
Income allocable to preferred shares................................ $ 4,264 $ 10,285
Income allocable to common shares................................... 20,432 38,443
------------ ------------
$ 24,696 $ 48,728
------------ ------------
------------ ------------
EARNINGS PER SHARE (H)................................................ $ 0.42 $ 0.54
------------ ------------
------------ ------------
</TABLE>

F-6
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT

FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND
YEAR ENDED DECEMBER 31, 1996
(UNAUDITED)

NOTES (IN THOUSANDS EXCEPT PER SHARE AMOUNTS):

(a) Reflects the Westfield America, Inc. and Subsidiaries Consolidated Statement
of Income for the three months ended March 31, 1997 and the year ended
December 31, 1996.

(b) Reflects the operations of (i) Acquired Properties, which were acquired on
July 1, 1996, for the period January 1, 1996 through June 30, 1996, and (ii)
the operations of Annapolis Mall and Wheaton Acquisition as if these
properties were acquired at the beginning of each period presented as
follows:

<TABLE>
<CAPTION>
THREE MONTHS
ENDED YEAR ENDED
MARCH 31, 1997 DECEMBER 31, 1996
-------------- -----------------
<S> <C> <C>
Revenues:
Minimum rents and percentage rents...................... $ 6,899 $ 45,534
Tenant recoveries....................................... 2,232 18,449
Expenses:
Operating............................................... 2,337 22,783
</TABLE>

Additionally, management fees were adjusted to reflect a payment equal to 5%
of the minimum rent and percentage rent, and depreciation expense was
adjusted to reflect the new basis of the properties based on purchase price.

(c) Effective July 1996, in conjunction with a reorganization of the Company, a
separate Advisory Agreement was entered into between the Company and the
Advisor which provided for an Advisory Fee. The Advisory Fee was calculated
as 55 basis points of the Company's net assets and was waived for the period
July 1, 1996 through December 31, 1997. In connection with the Offerings,
the Advisory Agreement will be amended and the Advisory Fee will be modified
to be the lower of (i) 55 basis points of the Company's net assets or (ii) a
base amount of 25% of the Company's FFO, as defined, in excess of $111.5
million. Since the Company's pro forma FFO are below the $111.5 million base
amount, no Advisory Fee was earned on a pro forma basis.

(d) Reflects the increase in interest expense resulting from the following:

<TABLE>
<CAPTION>
THREE MONTHS
ENDED YEAR ENDED
MARCH 31, 1997 DECEMBER 31, 1996
-------------- -----------------
<S> <C> <C>
Additional interest expense related to adjusted debt
balances of Acquired Properties......................... $ -- $ (9,984)
Increase in interest expense resulting from borrowings
under the unsecured corporate line of credit at 7%...... (1,312) (5,248)
------- --------
Net increase in interest expense........................ $ (1,312) $ (15,232)
------- --------
------- --------
</TABLE>

(e) Reflects reduction in equity in income of unconsolidated real estate
partnerships due to consolidation of Annapolis Mall.

(f) Reflects interest and other income from:

<TABLE>
<S> <C> <C>
Garden State Plaza Loan........................ $ 3,082 $ 12,325
Annapolis Mall and Wheaton Acquisition......... 243 411
------------- -------
$ 3,325 $ 12,736
------------- -------
------------- -------
</TABLE>

(g) Represent increase in minority interest in earnings of unconsolidated real
estate partnerships related to 30% interest in the Wheaton Acquisition not
owned by the Company.

(h) Earnings per share are computed assuming the Offerings and the
Recapitalization of the Company were effective at the beginning of each
period presented. Weighted average number of shares outstanding during the
three months ended March 31, 1997 and the year ended December 31, 1996 for
the purpose of computing pro forma earnings per share were 70,930 shares.

F-7
<PAGE>
REPORT OF INDEPENDENT AUDITORS

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

To the Board of Directors
of Westfield America, Inc.:

We have audited the accompanying consolidated balance sheet of Westfield
America, Inc. and Subsidiaries formerly CenterMark Properties, Inc. (the
"Company") as of December 31, 1996 and the related consolidated statement of
income, shareholders' equity and cash flows for the year then ended (our audit
also includes the financial statement schedule on page F-33). These consolidated
financial statements and financial statement schedule are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
consolidated financial statements and financial statement schedule based on our
audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects the consolidated financial position of
Westfield America, Inc. and Subsidiaries as of December 31, 1996 and the
consolidated results of operations and cash flows for the year then ended in
conformity with generally accepted accounting principles. Also, in our opinion,
the related financial statement schedule, when considered in relation to the
basic consolidated financial statements taken as a whole, presents fairly in all
material respects the information set forth thereof.

Ernst & Young LLP

Los Angeles, California
February 28, 1997

F-8
<PAGE>
REPORT OF INDEPENDENT AUDITORS

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

To the Board of Directors
of Westfield America, Inc.:

We have audited the accompanying consolidated balance sheet of Westfield
America, Inc. and Subsidiaries (the "Company") as of December 31, 1995 and the
related consolidated statements of income, changes in shareholders' equity and
cash flows for the year ended December 31, 1995 and the periods from February
12, 1994 through December 31, 1994 and from January 1, 1994 through February 11,
1994. These consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects the consolidated financial position of
Westfield America, Inc. and Subsidiaries as of December 31, 1995 and the
consolidated results of its operations and its cash flows for the year ended
December 31, 1995 and the periods from February 12, 1994 through December 31,
1994 and from January 1, 1994 through February 11, 1994 in conformity with
generally accepted accounting principles.

Coopers & Lybrand L.L.P.
Los Angeles, California
February 13, 1996, except for information as to
earnings per share, dividends per share and average shares outstanding,
for which the date is March 3, 1997.

F-9
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

ASSETS

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------
1996 1995
MARCH 31, ------------ ----------
------------
1997
------------
(UNAUDITED)
<S> <C> <C> <C>
INVESTMENT IN REAL ESTATE:
Land.................................................................... $ 196,810 $ 196,810 $ 143,851
Buildings, improvements and equipment................................... 1,001,768 975,224 503,125
Less accumulated depreciation and amortization.......................... (121,533) (110,260) (52,657)
------------ ------------ ----------
Net property and equipment............................................ 1,077,045 1,061,774 594,319

Construction in progress................................................ 33,135 49,821 5,447
Investments in unconsolidated real estate partnerships.................. 103,422 106,488 135,484
Direct financing leases receivable...................................... 91,860 92,351 94,234
------------ ------------ ----------
Net investment in real estate......................................... 1,305,462 1,310,434 829,484

CASH AND CASH EQUIVALENTS................................................. 2,647 6,729 --

RESTRICTED CASH........................................................... -- -- 100

ACCOUNTS AND NOTES RECEIVABLE (net of allowance of $6,305, $6,441 and
$4,187 in 1997, 1996 and 1995, respectively)............................ 21,768 19,716 9,661

DEFERRED EXPENSES AND OTHER ASSETS, NET................................... 9,125 7,691 5,461
------------ ------------ ----------
Total assets.......................................................... $ 1,339,002 $ 1,344,570 $ 844,706
------------ ------------ ----------
------------ ------------ ----------

LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Notes payable........................................................... $ 783,285 $ 770,625 $ 426,781
Accounts payable and accrued expenses................................... 29,681 33,380 23,903
Distribution payable.................................................... 1,952 21,981 13,603
Minority interest....................................................... -- 54 --
------------ ------------ ----------
Total liabilities..................................................... 814,918 826,040 464,287
------------ ------------ ----------
COMMITMENTS AND CONTINGENCIES............................................. -- -- --

SHAREHOLDERS' EQUITY (NOTE 9):
Common stock............................................................ 529 529 453
Preferred stock......................................................... 94,000 94,000 --
Additional paid-in capital.............................................. 424,001 424,001 379,966
Retained earnings....................................................... 5,554 -- --
------------ ------------ ----------
Total shareholders' equity............................................ 524,084 518,530 380,419
------------ ------------ ----------
Total liabilities and shareholders' equity............................ $ 1,339,002 $ 1,344,570 $ 844,706
------------ ------------ ----------
------------ ------------ ----------
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

F-10
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

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

<TABLE>
<CAPTION>
PERIOD FROM PERIOD FROM
THREE MONTHS ENDED YEAR ENDED FEBRUARY 12, JANUARY 1,
------------------------ ---------------------------- 1994 THROUGH 1994 THROUGH
MARCH 31, MARCH 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, FEBRUARY 11,
1997 1996 1996 1995 1994 1994
----------- ----------- ------------- ------------- ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
REVENUES:
Minimum rents................ $ 30,742 $ 20,967 $ 106,393 $ 75,154 $ 58,750 $ 7,309
Tenant recoveries............ 14,055 8,987 44,423 32,335 32,023 4,036
Percentage rents............. 1,986 1,572 3,991 1,690 2,470 467
Service fee income from
unconsolidated real estate
partnerships............... 120 475 1,282 2,148 6,213 957
----------- ----------- ------------- ------------- ------------- -------------
Total revenues............. 46,903 32,001 156,089 111,327 99,456 12,769
----------- ----------- ------------- ------------- ------------- -------------
EXPENSES:
Operating--recoverable....... 13,771 8,916 44,487 31,184 29,477 4,326
Other operating.............. 992 721 4,513 3,061 -- --
Management fees.............. 928 728 3,495 1,828 -- --
Advisory fee (not payable)... -- -- 2,600 -- -- --
General and administrative... 236 153 808 776 7,129 2,543
Depreciation and
amortization............... 11,539 8,027 38,033 28,864 24,897 3,605
----------- ----------- ------------- ------------- ------------- -------------
Total expenses............. 27,466 18,545 93,936 65,713 61,503 10,474
----------- ----------- ------------- ------------- ------------- -------------

OPERATING INCOME............... 19,437 13,456 62,153 45,614 37,953 2,295

INTEREST EXPENSE, NET.......... (12,860) (7,482) (40,233) (27,916) (24,156) (481)

OTHER INCOME:
Equity in income (losses) of
unconsolidated real estate
partnerships............... 1,293 733 3,063 3,359 (386) (2,151)
Interest and other income.... 312 230 776 789 1,830 340
----------- ----------- ------------- ------------- ------------- -------------

INCOME BEFORE MINORITY
INTEREST..................... 8,182 6,937 25,759 21,846 15,241 3

MINORITY INTEREST IN EARNINGS
OF CONSOLIDATED REAL ESTATE
PARTNERSHIP.................. (218) (230) (1,063) -- -- --
----------- ----------- ------------- ------------- ------------- -------------
NET INCOME..................... $ 7,964 $ 6,707 $ 24,696 $ 21,846 $ 15,241 $ 3
----------- ----------- ------------- ------------- ------------- -------------
----------- ----------- ------------- ------------- ------------- -------------
Net Income allocable to
preferred shares............. $ 1,998 $ 1 $ 4,264 $ 3 $ -- $ --
Net Income allocable to common
shares....................... 5,966 6,706 20,432 21,843 15,241 3
----------- ----------- ------------- ------------- ------------- -------------
$ 7,964 $ 6,707 24,696 21,846 15,241 3
----------- ----------- ------------- ------------- ------------- -------------
----------- ----------- ------------- ------------- ------------- -------------

Earnings per share............. $ 0.11 $ 0.15 $ 0.42 $ 0.48 $ 0.34

DISTRIBUTIONS DECLARED PER
COMMON SHARE................. $ 0.01 $ 0.06 $ 1.51 $ 1.68 $ 0.81

WEIGHTED AVERAGE NUMBER OF
COMMON SHARES................ 53,481 45,109 49,383 44,978 44,902
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

F-11
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(IN THOUSANDS)

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

<TABLE>
<CAPTION>
ADDITIONAL TOTAL
COMMON PREFERRED PAID-IN RETAINED SHAREHOLDERS'
STOCK STOCK CAPITAL EARNINGS EQUITY
----------- ----------- ----------- ----------- -------------

<S> <C> <C> <C> <C> <C>
BALANCES, JANUARY 1, 1994............................. $ 5,200 $ -- $ 657,630 $ 7,137 $ 669,967

Net income for the period from January 1, 1994 through
February 11, 1994................................... -- -- -- 3 3
Capital contributions from Prudential................. -- -- 48,000 -- 48,000
Distributions paid to Prudential...................... -- -- (460,558) (7,140) (467,698)
Distribution of partnership interest to Prudential.... -- -- (4,888) -- (4,888)
Capital contributions from GWG........................ -- -- 32,030 -- 32,030
----------- ----------- ----------- ----------- -------------

BALANCES, FEBRUARY 12, 1994........................... 5,200 -- 272,214 -- 277,414

Adjustment to reflect cost allocated to GWG's
investment in CenterMark Properties, Inc............ (5,200) -- 179,826 -- 174,626
----------- ----------- ----------- ----------- -------------

BALANCES, FEBRUARY 12, 1994, as adjusted.............. -- -- 452,040 -- 452,040
Stock split, 8980.3983 shares to 1.................... 451 -- (451) -- --

Net income for the period from February 12, 1994
through December 31, 1994........................... -- -- -- 15,241 15,241
Distributions on common stock......................... -- -- (21,258) (15,241) (36,499)
----------- ----------- ----------- ----------- -------------

BALANCES, DECEMBER 31, 1994........................... 451 -- 430,331 -- 430,782

Net income for the year ended December 31, 1995....... -- -- -- 21,846 21,846
Issuance of common stock.............................. -- -- 3,170 -- 3,170
Issuance of preferred stock........................... 2 -- 50 -- 52
Distributions on common stock......................... -- -- (53,585) (21,843) (75,428)
Distributions on preferred stock...................... -- -- -- (3) (3)
----------- ----------- ----------- ----------- -------------

BALANCES, DECEMBER 31, 1995........................... 453 -- 379,966 -- 380,419

Net income for the year ended December 31, 1996....... -- -- -- 24,696 24,696
Issuance of common stock.............................. 212 -- 342,109 -- 342,321
Cost of issuance of stock............................. -- -- (29,000) -- (29,000)
Repurchase of common stock............................ (136) -- (217,864) -- (218,000)
Issuance of preferred stock........................... -- 94,000 -- -- 94,000
Advisory fee (not payable)............................ -- -- 2,600 -- 2,600
Distributions on common stock......................... -- -- (53,810) (20,432) (74,242)
Distributions on preferred stock...................... -- -- -- (4,264) (4,264)
----------- ----------- ----------- ----------- -------------

BALANCES, DECEMBER 31, 1996........................... 529 94,000 424,001 -- 518,530
Net income for the three months ended March 31, 1997
(unaudited)......................................... -- -- -- 7,964 7,964
Distributions on common stock (unaudited)............. -- -- -- (412) (412)
Distributions on preferred stock (unaudited).......... -- -- -- (1,998) (1,998)
----------- ----------- ----------- ----------- -------------
BALANCES, MARCH 31, 1997 (UNAUDITED)................ $ 529 $ 94,000 $ 424,001 $ 5,554 $ 524,084
----------- ----------- ----------- ----------- -------------
----------- ----------- ----------- ----------- -------------
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

F-12
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

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

<TABLE>
<CAPTION>
PERIOD FROM PERIOD FROM
THREE MONTHS ENDED FEBRUARY 12, JANUARY 1,
------------------------ YEAR ENDED 1994 THROUGH 1994 THROUGH
MARCH 31, MARCH 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, FEBRUARY 11,
1997 1996 1996 1995 1994 1994
----------- ----------- ------------ ------------ ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income................... $ 7,964 $ 6,707 $ 24,696 $ 21,846 $ 15,241 $ 3
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation............... 11,273 7,828 37,130 28,296 24,405 3,421
Amortization............... 349 393 1,466 854 492 184
Equity in (income) losses
of unconsolidated real
estate partnership....... (1,293) (733) (3,063) (3,359) 386 2,151
Minority interest in
earnings of consolidated
real estate
partnership.............. 218 230 1,063 -- -- --
Advisory fee (not
payable)................. -- 2,600 -- -- --
Changes in assets and
liabilities:
Accounts receivable, net... (2,079) (2,162) (5,510) 2,525 41 (1,464)
Deferred expenses and other
assets................... (1,375) (387) (580) (605) (795) (3,473)
Accounts payable and
accrued expenses......... (3,479) (62) (1,914) (6,567) (19,105) 11,804
Deferred income taxes...... (8) (6) -- -- -- (7,332)
----------- ----------- ------------ ------------ ------------- -------------
Net cash flows provided by
operating activities....... 11,570 11,808 55,888 42,990 20,665 5,294
----------- ----------- ------------ ------------ ------------- -------------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures......... (10,266) (5,522) (44,084) (12,787) (26,782) (5,304)
Purchase of unconsolidated
partnership interest....... -- -- -- (2,000) -- --
Purchase of WPI, net of cash
acquired................... -- -- (62,794) -- -- --
Cash distributions received
from unconsolidated real
estate partnerships........ 4,359 1,717 10,786 16,558 29,961 267
Cash and cash equivalents of
consolidated real estate
partnership................ -- 2,389 2,389 -- -- --
Repayment of direct financing
leases receivable.......... 491 459 1,883 1,786 1,360 --
Notes receivable advances.... -- -- -- (268) (40) --
Notes receivable
repayments................. 27 24 107 186 815 119
Decrease (increase) in
investments................ -- -- -- 248 6,432 (709)
Decrease (increase) in
restricted cash............ -- 100 100 1,318 15,612 (17,030)
Repayment of advances made to
unconsolidated real estate
partnerships............... -- -- -- 435 300 --
Capital contribution to
unconsolidated real estate
partnerships............... -- -- -- -- (4,102) (844)
----------- ----------- ------------ ------------ ------------- -------------
Net cash flows (used in)
provided by investing
activities................. $ (5,389) $ (833) $ (91,613) $ 5,476 $ 23,556 $ (23,501)
----------- ----------- ------------ ------------ ------------- -------------
</TABLE>

F-13
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

(IN THOUSANDS)

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

<TABLE>
<CAPTION>
PERIOD FROM PERIOD FROM
THREE MONTHS ENDED FEBRUARY 12, JANUARY 1,
------------------------ YEAR ENDED 1994 THROUGH 1994 THROUGH
MARCH 31, MARCH 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, FEBRUARY 11,
1997 1996 1996 1995 1994 1994
----------- ----------- ------------ ------------ ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from issuance of
common stock............... $ -- $ -- $ 340,405 $ -- $ -- $ 32,030
Proceeds from issuance of
preferred stock............ -- -- 94,000 52 -- --
Purchase stock from common
stockholders............... -- -- (218,000) -- -- --
Stock issuance costs......... -- -- (29,000) -- -- --
Cash distributions paid to
preferred shareholders..... (2,241) (1) (2,070) (3) -- --
Cash distributions paid to
common stockholders........ (20,198) (17,595) (69,568) (61,825) (36,499) --
Shareholder recontribution of
distributions.............. -- 1,759 3,426 3,170 -- --
Decrease in minority interest
in consolidated real estate
partnership................ (484) -- (316) -- -- --
Proceeds from notes
payable.................... 22,755 23,381 114,172 16,700 -- 413,681
Principal payments on notes
payable.................... (10,095) (17,054) (190,595) (20,816) (31,489) --
Capital contributions from
Prudential................. -- -- -- -- -- 48,000
Cash distributions paid to
Prudential................. -- -- -- -- -- (467,698)
----------- ----------- ------------ ------------ ------------- -------------
Net cash flows (used in)
provided by financing
activities................. (10,263) (9,510) 42,454 (62,722) (67,988) 26,013
----------- ----------- ------------ ------------ ------------- -------------
Net (decrease) increase in
cash and cash
equivalents................ (4,082) 1,465 6,729 (14,256) (23,767) 7,806
CASH AND CASH EQUIVALENTS,
beginning of period.......... 6,729 -- -- 14,256 38,023 30,217
----------- ----------- ------------ ------------ ------------- -------------
CASH AND CASH EQUIVALENTS, end
of period.................... $ 2,647 $ 1,465 $ 6,729 $ -- $ 14,256 $ 38,023
----------- ----------- ------------ ------------ ------------- -------------
----------- ----------- ------------ ------------ ------------- -------------
</TABLE>

Supplemental cash flow information provided in Note 10.

The accompanying notes are an intergral part of the consolidated financial
statements

F-14
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

1. ORGANIZATION AND CHANGE IN OWNERSHIP:

Westfield America, Inc. ("WEA" or the "Company"), formerly CenterMark
Properties, Inc., is primarily in the business of owning, operating, leasing,
developing, redeveloping and acquiring super regional and regional retail
shopping centers in major metropolitan areas in the United States. On February
11, 1994, 100% of the stock of WEA, formerly May Centers, Inc., and
subsidiaries, was acquired from the Prudential Insurance Company of America
("Prudential") through a stock purchase agreement ("Stock Purchase Agreement")
between Prudential and GGP Limited Partnership ("GGP"), Westfield U.S.
Investments Pty. Limited ("WUSI"), a wholly owned subsidiary of Westfield
Holdings Limited ("WHL"), and five real estate investment funds sponsored by
Goldman Sachs & Co. ("Goldman"). The purchasers are collectively referred to as
"GWG." The cash purchase price including transaction costs of $14,830 was
approximately $420,000. In conjunction with the closing GWG contributed $32,030
to WEA, a portion of which was used to pay off revolving credit borrowings.

Also, in conjunction with the acquisition, the Company entered into an
agreement with CenterMark Management Company ("CMC"), a 50/50 partnership
between General Growth CMP, L.P. and Westfield Services, Inc., a wholly owned
subsidiary of WHL, to manage the properties in WEA's portfolio. Commencing
January 1, 1995, CMC subcontracted such management rights to Westfield
Corporation, Inc. ("WCI"), a wholly owned subsidiary of WHL. In July 1996, WCI
purchased General Growth CMP L.P.'s partnership interest in CMC. In
consideration for providing these management services, CMC will be reimbursed
certain recoverable property operating costs and receive gross fees of 5% of
minimum and percentage rents.

As part of the Stock Purchase Agreement, the Company elected Real Estate
Investment Trust ("REIT") status for income tax purposes.

The above acquisition was accounted for as a purchase. Accordingly, the cost
of the acquisition was allocated to the assets acquired and liabilities assumed
based upon their respective fair values. The results of operations and the
financial position of the Company reflect the revaluation of the assets and
liabilities of CMP to equal GWG's cost at February 11, 1994.

In 1995, WUSI and WCI, both wholly owned subsidiaries of WHL acquired 25% of
GGP's interest in the Company and concurrently acquired options to purchase the
remaining combined 50% interest in the Company held by GGP and Goldman.

On July 1, 1996, the Company was recapitalized (the "Recapitalization")
whereby the Company's common stock split 8,980.3983 shares to one and the
Company sold additional shares of both common and preferred stock to U.S. and
foreign investors (see Note 9) for $434,405.

In conjunction with the Recapitalization, the Company acquired the options
to acquire GGP and Goldman's interest in the Company and agreed to exercise such
options at two separate closing dates. On the first closing date, July 1, 1996,
the Company used $218,000 of the Recapitalization proceeds to repurchase 40% of
GGP's interest and 90% of Goldman's interest in the Company. On the second
closing date, January 2, 1997, the Company purchased GGP's remaining interest in
the Company for $130,500 from proceeds received from the sale of shares to an
affiliate of WHL. The Recapitalization does not result in a sufficient change in
ownership to warrant purchase accounting.

On July 1, 1996, the Company used $62,794 of the Recapitalization proceeds
to acquire indirect ownership of three regional shopping centers, Connecticut
Post Mall, South Shore Mall and Trumbull

F-15
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

1. ORGANIZATION AND CHANGE IN OWNERSHIP: (CONTINUED)
Shopping Park (the "Acquired Properties") through the acquisition of
substantially all the outstanding stock of Westland Properties, Inc., a company
whose business consisted of operating the Acquired Properties.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

BASIS OF PRESENTATION:

The Company conducts its business through its divisions, wholly-owned
subsidiaries and affiliates. The consolidated financial statements include the
accounts of the Company and all subsidiaries over which the Company is able to
exercise significant control. The Company does not consider itself to be in
control when the other partners have important approval rights over major
actions. Investments as general and limited partner in non-controlled
partnerships are accounted for using the equity method. All significant
intercompany accounts and transactions have been eliminated in consolidation.

The accompanying unaudited financial statements for the three month periods
ended March 31, 1997 and 1996 have been prepared in accordance with generally
accepted accounting principles. In the opinion of management, such financial
statements reflect all adjustments considered necessary for a fair presentation
of the results of the respective interim periods and all such adjustments are of
a normal, recurring nature.

INVESTMENT IN REAL ESTATE:

Buildings, improvements and equipment are stated at cost. Costs related to
the acquisition, development, construction and improvement of properties are
capitalized. Interest costs and real estate taxes incurred during construction
periods are capitalized and amortized on the same basis as the related assets.
Expenditures for repairs and maintenance are charged to expense when incurred.
Certain repair and maintenance costs are chargeable to the tenants as provided
in their leases. Such reimbursements are included in recoverable expenses in the
Consolidated Statements of Income. Depreciation of property is computed on the
straight-line method over the estimated useful lives of the property, which
generally range from 3 to 50 years.

In March 1995, the Financial Accounting Standards Board issued Statement No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of," which requires impairment of losses to be recorded on
long-lived assets used in operations when indicators of impairment are present
and the undiscounted cash flows estimated to be generated by those assets are
less than the assets' carrying amount. In this case an impairment loss is
recognized to the extent that the carrying amount exceeds the fair value of the
assets. Statement 121 also addresses the accounting for long-lived assets that
are expected to be disposed of. Such assets are reported at the lower of their
carrying amount or fair value, less cost to sell. The Company adopted Statement
121 in 1996 and the adoption had no effect.

CASH AND CASH EQUIVALENTS:

The Company considers all highly liquid investments with an original
maturity of three months or less at date of purchase to be cash equivalents.

F-16
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (CONTINUED)
RESTRICTED CASH:

Restricted cash at December 31, 1995 represented remaining funds for the
completion of the Westland Center redevelopment.

REVENUE RECOGNITION:

Shopping center space is generally leased to specialty retail tenants under
leases which are accounted for as operating leases. Minimum rent revenues are
recognized on a straight-line basis over the respective lease term. Percentage
rents are recognized on an accrual basis as earned. Recoveries from tenants are
recognized as income in the period the applicable costs are accrued.

INTEREST RATE SWAP CONTRACTS

In the normal course of business the Company enters into interest rate swap
contracts to reduce its exposure to fluctuations in interest rates. Net interest
differentials to be paid or received related to these swap contracts are accrued
as incurred or earned. Any gain or loss from terminating swap contract
transactions will be deferred and recognized over the original swap contract
term as a yield adjustment to interest expense of the underlying debt. There
were no terminations of swap contracts during the year ended December 31, 1996.
When the underlying debt matures or is extinguished any unamortized gain or loss
is recognized at that time.

ACCOUNTS AND NOTES RECEIVABLE:

Accounts and notes receivable include amounts billed to tenants, deferred
rent receivables arising from straight-lining of rents and accrued recoveries
from tenants. Management periodically evaluates the collectibility of these
receivables and adjusts the allowance for doubtful accounts to reflect the
amounts estimated to be uncollectible.

DEFERRED EXPENSES AND OTHER ASSETS:

Deferred expenses and other assets include costs associated with notes
payable, tenant leases and prepaid expenses. Costs associated with obtaining
notes payable are amortized on a straight-line basis over the term of the
related notes payable, which approximates the effective interest rate method.
Direct costs related to leasing activities are capitalized and amortized over
the initial term of the new lease.

LEASE TERMINATIONS:

Included in accounts payable and accrued expenses are lump sum payments
received from tenants to terminate their lease. Income received from tenants for
early lease termination is deferred and amortized over the term of the original
lease unless the space is re-leased to a new tenant, at which time the remaining
deferred income is recognized. The unamortized costs of improvements pertaining
to terminated leases are expensed in the period of termination unless the
improvements can be used by the replacement tenant.

F-17
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (CONTINUED)
EARNINGS PER SHARE:

Net income and dividend declared per common share is calculated by dividing
net income applicable to common stock (net income less dividend requirements of
preferred stock) by the weighted average number of shares of common stock and
common stock equivalents outstanding. Common stock equivalents are represented
by a warrant to purchase common stock at $16.01 per share (Note 9). Net income
and dividends per share for the period January 1, 1994 through February 11, 1994
have not been presented as they are not meaningful given the change in capital
structure that occurred in conjunction with the February 11, 1994 acquisition.

INCOME TAXES:

In conjunction with the February 11, 1994 acquisition, the Company elected
REIT status for income tax purposes. As a REIT, the Company is required to
distribute at least 95% of its taxable income to shareholders and meet certain
asset and income tests as well as certain other requirements. As a REIT, the
Company will generally not be liable for federal and state income taxes,
provided it satisfies the necessary requirements.

USE OF ESTIMATES:

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the consolidated
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.

3. INVESTMENTS IN UNCONSOLIDATED REAL ESTATE PARTNERSHIPS:

As of December 31, 1996, the Company is a general and managing partner in
five real estate partnerships, a limited partner in one real estate partnership
and both a general and limited partner in one real estate partnership. As a
result of the February 11, 1994 acquisition, the carrying amount of investments
in unconsolidated real estate partnerships was adjusted to reflect the purchase
accounting adjustments described in Note 1. This adjustment is being amortized
on a straight-line basis over the useful life of the associated asset which
ranges from 15 to 24 years. The Company's interest in each partnership as of
December 31, 1996 is as follows:

<TABLE>
<CAPTION>
PERCENT
PROPERTY LOCATION INTEREST
- -------------------------------------------------------- -------------------------- -----------
<S> <C> <C>
Annapolis Mall.......................................... Annapolis, MD 30.0%
Meriden Square.......................................... Meriden, CT 50.0
Plaza Camino Real....................................... Carlsbad, CA 40.0
Topanga Plaza........................................... Canoga Park, CA 42.0
Vancouver Mall.......................................... Vancouver, WA 50.0
West Valley............................................. Canoga Park, CA 42.5
North County Fair....................................... Escondido, CA 45.0
</TABLE>

F-18
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

3. INVESTMENTS IN UNCONSOLIDATED REAL ESTATE PARTNERSHIPS: (CONTINUED)
A summary of the condensed balance sheet and income statement information
for all unconsolidated real estate partnerships on a combined basis follows:

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------
CONDENSED BALANCE SHEET INFORMATION 1996 1995
- ------------------------------------------------------------------------------ ----------- -----------
<S> <C> <C>
Investment in real estate:
Land, building and improvements, at cost.................................... $ 487,571 $ 516,710
Less accumulated depreciation and amortization.............................. (167,020) (160,220)
Construction in progress.................................................... 1,115 6,984
----------- -----------
Net investment in real estate................................................. 321,666 363,474
Notes payable to affiliate.................................................... (1,156) --
Other notes payable........................................................... (226,619) (260,241)
Other assets and liabilities, net, and interest of other partners............. (50,977) (56,811)
----------- -----------
Net equity investment in unconsolidated real estate partnerships.............. 42,914 46,422
Adjustments to reflect cost allocated to GWG's investment..................... 63,574 78,100
Cost in excess of basis in the Mission Valley partnership interest acquired... -- 10,962
----------- -----------
Investments in unconsolidated real estate partnerships.................... $ 106,488 $ 135,484
----------- -----------
----------- -----------
</TABLE>

<TABLE>
<CAPTION>
PERIOD FROM PERIOD FROM
FEBRUARY 12, JANUARY 1,
YEAR ENDED YEAR ENDED 1994 THROUGH 1994 THROUGH
CONDENSED STATEMENTS OF DECEMBER 31, DECEMBER 31, DECEMBER 31, FEBRUARY 11,
INCOME (LOSS) INFORMATION 1996 1995 1994 1994
- ---------------------------------------------------- ------------ ------------ ------------- -------------
<S> <C> <C> <C> <C>
Total revenue....................................... $ 85,767 $ 95,359 $ 74,661 $ 13,734
Costs and expenses:
Operating, general and administrative expenses.... 27,975 32,549 30,537 9,156
Interest expense, net............................. 22,342 24,844 19,885 3,570
Depreciation and amortization..................... 21,263 22,525 20,081 3,766
------------ ------------ ------------- -------------
Net income (loss)................................. 14,187 15,441 4,158 (2,758)
Other partners' share of (income) loss.............. (7,049) (7,177) (2,647) 1,627
Adjustments to reflect the amortization of cost
allocated to GWG's and Prudential's investment in
CMP............................................... (4,075) (4,905) (1,897) (1,020)
------------ ------------ ------------- -------------
Equity in income (losses) of unconsolidated real
estate partnerships............................... $ 3,063 $ 3,359 $ (386) $ (2,151)
------------ ------------ ------------- -------------
------------ ------------ ------------- -------------
</TABLE>

Significant accounting policies used by unconsolidated real estate partnerships
are similar to those used by the Company.

F-19
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

3. INVESTMENTS IN UNCONSOLIDATED REAL ESTATE PARTNERSHIPS: (CONTINUED)

On September 1, 1995, the Company increased its ownership interest in
Mission Valley Partnership from 50 percent to 75.8 percent.

On January 17, 1994, an earthquake occurred near Topanga Plaza. The cost of
the repairs was approximately $11,500 of which $865 remains to be spent at
December 31, 1996. The majority of this cost was recovered under the
Partnership's earthquake insurance policy after payment of the required
deductible of approximately $2,100. The Company's share of this deductible and
uninsured expenses along with the write off of certain leasehold improvements
was $1,512 and is included in equity in income (losses) of unconsolidated real
estate partnerships in 1994. In 1995, the Topanga Plaza Partnership received
insurance proceeds for business interruption caused by the 1994 earthquake. The
Company's share of these proceeds, previously unrecognized due to uncertainty,
was $1,358, and is included in equity in income (losses) of unconsolidated
partnerships in 1995. During 1996, the Topanga Plaza Partnership was reimbursed
by two of its major department store tenants for their pro-rata share of the
cost of repairs caused by the earthquake. The Company's share of these proceeds,
previously unrecognized due to uncertainty, is $216, and is included in equity
in income (losses) of unconsolidated partnerships in 1996.

In January 1994, the Company increased its ownership interest in Plaza
Camino Real from 5 percent to 40 percent and changed its management and leasing
fee agreements.

4. LEASES:

DIRECT FINANCING LEASES RECEIVABLE:

The Company owns certain properties that are leased to May Department Stores
Company ("May") under direct financing leases. The leases' initial terms expire
in September 2017, and may be renewed for up to 14 additional five year terms.
May has the option to purchase the property under these leases at fair market
value during the last 16 months of the initial term or any of the renewal option
terms.

As a result of the changes in ownership described in Note 1, the direct
financing leases receivable at February 11, 1994 were revalued based upon future
cash flows for these leases discounted at seven percent.

The direct financing leases receivable are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
1996 1995
---------- ----------
<S> <C> <C>
Minimum lease payments receivable..................................... $ 177,030 $ 185,460
Less unearned revenue................................................. (84,679) (91,226)
---------- ----------
Direct financing leases receivable.................................. $ 92,351 $ 94,234
---------- ----------
---------- ----------
</TABLE>

F-20
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

4. LEASES: (CONTINUED)
The future minimum rentals to be received by the Company on the direct
financing leases as of December 31, 1996, are as follows:

<TABLE>
<S> <C>
1997.............................................................. $ 8,430
1998.............................................................. 8,430
1999.............................................................. 8,430
2000.............................................................. 8,430
2001.............................................................. 8,430
Thereafter........................................................ 134,880
---------
$ 177,030
---------
---------
</TABLE>

In connection with the redevelopment plan at Eastland Shopping Center, the
Company exercised its option to purchase May's leasehold interest in its store
at Eastland in 1994.

PROPERTY RENTAL:

Substantially all of the property owned by the Company is leased to
third-party tenants under operating leases as of December 31, 1996. Lease terms
vary between tenants and some leases include percentage rental payments based on
sales volume.

Future minimum rental revenues under noncancelable operating leases as of
December 31, 1996, are as follows:

<TABLE>
<S> <C>
1997.............................................................. $ 93,229
1998.............................................................. 87,842
1999.............................................................. 83,394
2000.............................................................. 79,131
2001.............................................................. 71,550
Thereafter........................................................ 235,405
---------
$ 650,551
---------
---------
</TABLE>

These amounts do not include percentage rentals that may be received under
certain leases on the basis of tenant sales in excess of stipulated minimums.

5. ACCOUNTS AND NOTES RECEIVABLE:

At December 31, 1996 and December 31, 1995, accounts and notes receivable
include $367 and $429 of tenant notes receivable and $5,192 and $5,281 of other
notes receivable which primarily relate to property sales and which bear
interest at rates ranging from 7.0% to 8.5% and are due at various dates ranging
from 1997 to 2004.

F-21
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

6. DEFERRED EXPENSES AND OTHER ASSETS:

Deferred expenses and other assets are summarized as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
1996 1995
--------- ---------
<S> <C> <C>
Lease costs, net of accumulated amortization of $2,100 and $560 in 1996 and
1995, respectively....................................................... $ 4,354 $ 2,406
Loan costs, net of accumulated amortization of $881 and $286 in 1996 and
1995, respectively....................................................... 1,668 1,520
Other assets............................................................... 1,669 1,535
--------- ---------
$ 7,691 $ 5,461
--------- ---------
--------- ---------
</TABLE>

7. NOTES PAYABLE AND LINES OF CREDIT:

A summary of notes payable is as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
1996 1995
---------- ----------
<S> <C> <C>
Collateralized nonrecourse notes to an insurance company, interest only payable monthly,
at 6.15% due in 1999.................................................................... $ 172,000 $ 172,000
Collateralized nonrecourse notes to an insurance company, interest only payable monthly,
at 6.51% due in 2001.................................................................... 167,000 167,000
Senior collateralized nonrecourse notes, interest only payable quarterly at 6.39% until
1997, thereafter principal and interest payable quarterly, due in 2004.................. 20,576 20,576
Senior collateralized nonrecourse notes bearing interest at 7.33%, $1,620 principal and
interest payable quarterly until 1997, interest only payable from 1997 until 2004,
principal and interest payable thereafter, due in 2014.................................. 56,429 58,705
Unsecured line of credit/collateralized project loan from a bank with a maximum commitment
of $50,000, interest only at LIBOR + 1.5% ($1,500 is at 8.25% and $3,500 is at 7.156% at
December 31, 1996) payable monthly, due in 1998......................................... 5,000 --
Collateralized recourse note to an insurance company, interest only payable monthly at
8.09%, due in 1999...................................................................... 15,000 --
Collateralized recourse construction loan payable to a bank, interest only at LIBOR + 1.5%
($1,000 is at 7.156% and $3,885 is at 7.094% at December 31, 1996) payable monthly, due
in 1998 with an option to extend to 2001................................................ 4,885 --
Collateralized non-recourse note payable to an insurance company interest at an effective
rate of 7.07%, $1,182 principal and interest payable monthly, due in 2000............... 144,959
Collateralized non-recourse note payable to a bank, interest only at LIBOR + 1% (6.5% at
December 31, 1996) payable quarterly, due in 2001....................................... 73,350 --
Collateralized non-recourse note payable to a bank, interest only at LIBOR + 1% (6.5% at
December 31, 1996) payable quarterly, due in 2001....................................... 73,450 --
</TABLE>

F-22
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

7. NOTES PAYABLE AND LINES OF CREDIT: (CONTINUED)

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
1996 1995
---------- ----------
<S> <C> <C>
Collateralized non-recourse construction loan payable to a bank with a maximum commitment
of $48,000, interest only payable monthly at LIBOR + 1.75% ($2,050 at 7.44% and $13,853
at 7.32% December 31, 1996) with borrowings totaling $22,073 fixed at 7.5% through
maturity, due in 1997 with an option to extend to 2000.................................. 37,976 --
Line of credit with a total commitment of $30,000 collateralized by a shopping center
property. Interest only payable monthly at prime or a LIBOR based rate. This line of
credit was repaid in 1996 and replaced with a $50 million line of credit from a bank as
previously disclosed.................................................................... -- 1,000
Collateralized non-recourse note, interest only payable monthly at the lower of prime + 1%
or 12% (9.5% at December 31, 1995), repaid in 1996...................................... -- 1,500
Collateralized note, principal of $3,000 plus accrued interest at prime due quarterly,
repaid in 1996.......................................................................... -- 6,000
---------- ----------
$ 770,625 $ 426,781
---------- ----------
---------- ----------
</TABLE>

Interest costs capitalized for the years ended December 31, 1996 and 1995
were $1,503 and $52, respectively. There was no capitalized interest in 1994.

Senior collateralized non-recourse notes totaling $77,005 and $79,281 at
December 31, 1996 and 1995, respectively, are collateralized by the related
direct financing leases receivable from The May Company.

The unsecured portion of the Company's line of credit, initially totaling
$50,000 is for general corporate purposes.

The annual maturities of notes payable as of December 31, 1996 are as
follows:

<TABLE>
<S> <C>
1997.............................................................. $ 6,539
1998.............................................................. 12,022
1999.............................................................. 194,542
2000.............................................................. 172,633
2001.............................................................. 321,842
Thereafter........................................................ 63,047
---------
$ 770,625
---------
---------
</TABLE>

Certain note payable agreements above provide restrictive covenants relating
to the maintenance of specified financial performance ratios such as minimum net
worth, debt service coverage ratio, loan to value, ownership percentages and
restrictions on future dividend payments. As of December 31, 1996, the Company
was in compliance with these covenants.

F-23
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

8. INTEREST RATE SWAP CONTRACTS:

At December 31, 1996, the Company had two swap agreements. Interest rate
swaps are contractual agreements between the Company and third parties to
exchange fixed and floating interest payments periodically without the exchange
of the underlying principal amounts (notional amounts). Notional amounts are
used to express the volume of interest rate swap contracts. In the unlikely
event that a counterparty fails to meet the terms of an interest rate swap
contact, the Company's exposure is limited to the interest rate differential on
the notional amount. The Company does not anticipate non-performance by any of
the counterparties. Under one of the swap agreements, which has a notional
amount of $125,000, the Company is credited interest at LIBOR and incurs
interest at a fixed rate of 5.75%. Under the second swap agreement, which has a
notional amount of $11,400, the Company incurs interest at LIBOR and is credited
interest at a fixed rate of 6.23%. Both swap agreements expire in 2000.

On November 27, 1996 and November 29, 1996, the Company completed structured
deferred interest rates swaps totaling $90 million notional amount, where the
Company will receive LIBOR and pay 6.125% for three years beginning February 11,
1999. Additionally, the counterparty received an option to extend the swaps for
an additional two years exercisable on November 12, 1997.

The fair value and unrealized gain of the interest rate swap contracts were
approximately $1,360 at December 31, 1996.

9. CAPITAL STOCK:

In conjunction with the acquisition of WEA at February 11, 1994, the Company
authorized 269,411,949 shares of $0.01 par value common stock of which
44,901,991 shares were issued. During 1995, WEA issued an additional 212,836
shares of common stock in conjunction with the recontribution of 10% of the July
1995 and October 1995 distribution, respectively. Additionally during 1995, the
Company authorized 200 shares of 7% non-cumulative, non-participating,
non-voting preferred stock with a par value of $1.00 of which 105 shares were
issued. During the six months ended June 30, 1996, the Company issued an
additional 169,370 shares of common stock in conjunction with the recontribution
of 10% and 5% of the December 1995 and March 1996 distributions, respectively.

In July 1996, the Company's Articles of Incorporation were amended. The
total number of shares of all classes of stock that the Company is authorized to
issue is 435,012,800.

In conjunction with the Recapitalization in July 1996, the Company's stock
split 8,980.3983 shares to one. In addition, Westfield America Trust ("WAT"), a
newly formed publicly traded Australian trust in which WHL has an ownership
interest, acquired 19,631,543 shares of Class B-1 common stock and a warrant to
purchase up to 6,246,096 shares of Class B-1 common stock at $16.01 per share,
all of which was exercisable at December 31, 1996. The Company received
$314,304, 940,000 WAT Special Options and 2,498,440 WAT Ordinary Options for the
issuance of this stock and warrants issued by the Company. In connection with
the sale of common and preferred stock, WEA designated the purchasers of such
stock to be the recipients of WAT Ordinary and Special Options, respectively.

The Company received additional proceeds totaling $26,101 from the sale of
1,623,985 shares of Class B-2 common stock, 6,300 shares of Class B-3 common
stock and 2,498,440 WAT Ordinary Options. The Company also received $94,000 upon
the sale of 940,000 shares of Series A Preferred Stock and sale of 940,000 WAT
special options.

F-24
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

9. CAPITAL STOCK: (CONTINUED)
The Company used a portion of the proceeds raised from the issuance of
common and preferred stock to repurchase 5,434,104 shares from GGP and 8,182,386
shares from Goldman for a total purchase price of $218,000. The cost associated
with the Recapitalization of the Company and issuance of new capital stock was
$29,000.

At December 31, 1996 and 1995, the total number of shares authorized, issued
and outstanding were as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1995
DECEMBER 31, 1996 ---------------------------
--------------------------- NUMBER OF
NUMBER OF NUMBER OF NUMBER OF SHARES
SHARES SHARES SHARES ISSUED AND
AUTHORIZED OUTSTANDING AUTHORIZED OUTSTANDING
------------- ------------ ------------- ------------
<S> <C> <C> <C> <C>
Class A common stock, $.01 par value................... 25,000,000 8,151,155 44,901,992 18,045,931
Class B common stock, $.01 par value................... -- -- 44,901,992 18,045,931
Class B-1 common stock, $.01 par value................. 100,000,000 31,342,970 -- --
Class B-2 common stock, $.01 par value................. 100,000,000 13,429,110 -- --
Class B-3 common stock, $.01 par value................. 6,300 6,300 -- --
Class C common stock, $.01 par value................... -- -- 44,901,992 9,022,965
Excess common stock, $.01 par value.................... 200,006,300 -- 134,705,973 --
Non-voting senior preferred stock, $1.00 par value..... 200 105 200 105
Preferred stock, $1.00 par value of which 940,000
shares shall be designated Series A cumulative
redeemable preferred stock........................... 5,000,000 940,000 -- --
Excess preferred stock, $1.00 par value................ 5,000,000 -- -- --
------------- ------------ ------------- ------------
Total number of shares authorized, issued and
outstanding...................................... 435,012,800 53,869,640 269,412,149 45,114,932
------------- ------------ ------------- ------------
------------- ------------ ------------- ------------
</TABLE>

Shares authorized, issued and outstanding at December 31, 1995 were adjusted to
reflect the July 1996 stock split.

SENIOR PREFERRED SHARES:

The holders of non-voting senior preferred stock shall be entitled to
receive, when declared, cash dividends at an annual rate of $35 per share, and
no more, payable quarterly. No dividend shall be paid on any Preferred or Common
Shares unless the full dividend has been paid on the Senior Preferred Shares.
The Company has an option to redeem the Senior Preferred Shares anytime after
February 20, 1999 at a redemption price of $550 per share, which is equal to the
liquidation preference.

SERIES A PREFERRED SHARES:

The holders of Series A Preferred Shares shall be entitled to receive, when
declared, cumulative cash dividends equal to the greater of $8.50 per annum or
an amount currently equal to 6.2461 times the dollar amount declared on common
shares. Series A Preferred Shareholders are entitled to dividends before
dividends are distributed to common shareholders. The holders of Series A
Preferred Shares have no

F-25
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

9. CAPITAL STOCK: (CONTINUED)
voting rights unless a dividend is not declared for four quarters, at which time
the holders of Series A Preferred Shares may elect a Director to be added to the
Board of Directors. The Company has an option to redeem the Series A Preferred
Shares anytime after July 1, 2003 at a redemption price of $100 per share, which
is equal to the liquidation preference. Simultaneously with the issuance of the
Series A Preferred Shares, the Series A Preferred Shareholder also acquired
940,000 Special Options to acquire units in WAT. Each special option permits the
holder to acquire 124.92 (or 117,428,609 WAT units in the aggregate) units in
WAT in consideration for $100 or one Series A Preferred Share. The Special
Options are exercisable at any time after July 1, 1998 and prior to July 1,
2011.

COMMON SHARES:

The holders of Class A, Class B-1, Class B-2 and Class B-3 Common Shares
vote together as a class on all matters other than election of directors and
termination of REIT status and are entitled to receive distributions declared
after payment of dividends on preferred shares. Simultaneously with the
Recapitalization, the Class B-2 Shareholders acquired 13,429,110 Ordinary
Options to acquire units in WAT. Each Ordinary Option permits the holder to
acquire 20 units in WAT in exchange for one Class B-2 Common Share. The Ordinary
Options are exercisable at any time after January 1, 1997. The Ordinary Options
expire upon the listing of the Company's Common Stock on the New York Stock
Exchange, the American Stock Exchange or the London Stock Exchange.

10. SUPPLEMENTAL CASH FLOW INFORMATION:

<TABLE>
<CAPTION>
PERIOD FROM PERIOD FROM
FEBRUARY 12, JANUARY 1, 1994
YEAR ENDED YEAR ENDED 1994 THROUGH THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, FEBRUARY 11,
1996 1995 1994 1994
------------ ------------ ------------ ---------------
<S> <C> <C> <C> <C>
CASH PAID DURING THE PERIOD FOR:
Interest (net of amount capitalized).................. $ 42,378 $ 27,444 $ 21,731 $ 307
------------ ------------ ------------ -----
------------ ------------ ------------ -----
Income taxes.......................................... $ 60 $ 73 $ 1,684 $ --
------------ ------------ ------------ -----
------------ ------------ ------------ -----
</TABLE>

NON CASH INVESTING AND FINANCING INFORMATION:

Mission Valley Partnership was accounted for under the equity method in 1995
and has been consolidated in 1996. The condensed assets and liabilities of the
partnership were as follows:

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1996 1995
------------ ------------
<S> <C> <C>
Net investment in real estate.................................... $ 34,992 $ 24,612
Cash and Cash Equivalents........................................ 2,824 2,389
Accounts and notes receivable.................................... 1,407 891
Deferred expenses and other assets............................... 979 1,201
Notes payable.................................................... (37,976) (28,988)
Accounts payable................................................. (2,172) (798)
------------ ------------
Minority/other partners' interest................................ $ 54 $ (693)
------------ ------------
------------ ------------
</TABLE>

F-26
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS EXCEPT SHARE AMOUNTS)

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

10. SUPPLEMENTAL CASH FLOW INFORMATION: (CONTINUED)
The Mission Valley Partnerships condensed consolidated statements of income
were as follows:

<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1996 1995
------------ ------------
<S> <C> <C>
Total Revenue.................................................... $ 13,198 $ 11,117
Total Expenses................................................... 8,179 7,102
------------ ------------
Operating Income............................................... 5,019 4,015
Interest Expense................................................. (1,945) (2,226)
Other Income..................................................... 76 185
------------ ------------
Income before minority/other partners' interest................ 3,150 1,974
Minority/other partners' interest in earnings.................... (1,063) (1,277)
------------ ------------
Net income..................................................... $ 2,087 $ 697
------------ ------------
------------ ------------
</TABLE>

During 1996, construction in process totaling $4,529 was placed into
service.

During 1995, the Company increased its ownership interest in the Mission
Valley Partnership from 50% to 75.8%. In consideration, the Company paid $2,000
in cash and provided the partner selling its interest with a note for the
remaining purchase price totaling $9,000.

During 1995, the Company purchased a building previously owned by one of the
Company's major tenants. In consideration, the Company paid $528 in cash and
provided the seller with a note for the remaining purchase price totaling
$1,500.

Included in accounts payable and accrued liabilities at December 31, 1995
are cash overdrafts totaling $2,263.

The cost of GWG's acquisition of the Company on February 11, 1994 was
accounted for as a purchase. Accordingly, the cost of the acquisition was
allocated to the assets acquired and liabilities assumed based upon respective
fair values as follows:

<TABLE>
<CAPTION>
Net property and equipment................................................ $ (10,498)
<S> <C>
Investments in unconsolidated real estate partnerships.................... (6,818)
Direct financing leases receivable........................................ 13,484
Accounts and notes receivable............................................. (2,465)
Deferred expenses and other assets........................................ (7,715)
Accounts payable and accrued expenses..................................... (6,863)
Deferred income taxes..................................................... 195,501
---------
Adjustment to reflect cost allocated to GWG's investment in CenterMark
Properties, Inc....................................................... $ 174,626
---------
---------
</TABLE>

Shortly before GWG's acquisition of the Company on February 11, 1994, the
Company dividended its 50% interest in Ballston Common Mall to Prudential. The
assets and liabilities that were dividended consisted of the following:

<TABLE>
<CAPTION>
Net investment in real estate.............................................. $ (3,037)
<S> <C>
Investment in unconsolidated real estate partnerships...................... (3,408)
Accounts payable and accrued expenses...................................... 1,557
---------
Distribution of partnership interest to Prudential......................... $ (4,888)
---------
---------
</TABLE>

F-27
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

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

11. INCOME TAXES:

As discussed in Note 2, the Company elected REIT status for income tax
purposes effective February 12, 1994 and, accordingly, is exempt from federal
income tax subsequent to that date. For the year ended December 31, 1996 and
1995 and the period from February 12, 1994 through December 31, 1994,
distributions have exceeded taxable income resulting in a partial return of
capital. On a per share basis distributions represented by ordinary income and
return of capital were approximately as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER PERIOD FROM
31, FEBRUARY 12, 1994
-------------------- THROUGH DECEMBER
1996 1995 31, 1994
--------- --------- -------------------
<S> <C> <C> <C>
(UNAUDITED)
Distributions per share representing ordinary income.......................... $ 0.88 $ 0.61 $ 0.56
Distributions per share representing a return of capital...................... 0.63 0.96 0.35
--------- --------- -----
Total distributions per share based on income tax amounts..................... $ 1.51 $ 1.57 $ 0.91
--------- --------- -----
--------- --------- -----
</TABLE>

For periods prior to the REIT election, the income tax provision consisted of
the following:

<TABLE>
<CAPTION>
PERIOD FROM
JANUARY 1,
1994 THROUGH
FEBRUARY 11,
1994
-------------
<S> <C>
Current income taxes:
Federal...................................................................... $ 6,968
State and local.............................................................. 1,847
-------------
Total current income taxes................................................. 8,815
-------------
Deferred income taxes:
Federal...................................................................... (5,752)
State and local.............................................................. (1,580)
-------------
Total deferred income taxes................................................ (7,332)
Tax benefit due to dividend of partnership investment.......................... (1,480)
-------------
$ 3
-------------
-------------
</TABLE>

In 1994, total current income taxes includes $6,965 in federal and $1,551 in
state income taxes relating to the Ballston Common Mall partnership interest
dividended to Prudential as discussed in Note 10.

Included in accounts payable and accrued liabilities is a deferred income
tax liability of $1,479 and $1,457 at December 31, 1996 and 1995, respectively,
relating to installment notes receivable for property sales prior to February
12, 1994.

F-28
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

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

12. RELATED PARTIES:

As discussed in Note 1, the Company acquired the Acquired Properties in
conjunction with the Company's Recapitalization. Accordingly, the cost of this
acquisition was allocated to the assets acquired and liabilities assumed based
upon their respective fair values as follows:

<TABLE>
<S> <C>
Net property and equipment...................................... $ 459,707
Cash and cash equivalents....................................... 9,616
Accounts and notes receivable................................... 3,761
Deferred expenses and other assets.............................. 1,915
Notes payable................................................... (388,609)
Accounts payable and accrued expenses........................... (13,980)
----------
Total purchase price............................................ $ 72,410
----------
----------
</TABLE>

The operations of the Company include the Acquired Properties from the date
of purchase, July 1, 1996. If the Acquired Properties were acquired on January
1, 1995, the Condensed Consolidated Statements of Income would have been as
follows:

<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1996 1995
(UNAUDITED) (UNAUDITED)
------------ ------------
<S> <C> <C>
Total revenues................................................... $ 183,352 $ 164,511
Total operating expenses......................................... 67,096 58,812
Depreciation expense............................................. 43,131 39,060
------------ ------------
Operating income............................................... 73,125 66,639
Interest expense, net............................................ (52,479) (52,306)
Other income..................................................... 3,839 4,148
------------ ------------
Income before minority interest................................ 24,485 18,481

Minority interest................................................ (1,063) --
------------ ------------
Net income....................................................... $ 23,422 $ 18,481
------------ ------------
------------ ------------
Earnings per share............................................... $ 0.39 $ 0.41
------------ ------------
------------ ------------
Estimated taxable income......................................... $ 39,372
------------
------------
Estimated cash flow.............................................. $ 79,536
------------
------------
</TABLE>

If all of the above estimated cash flows were assumed to have been
distributed, the unaudited distributions per share, based on the pro forma
common shares and Common Stock equivalents outstanding would have been $1.53 per
share which would have included an unaudited estimated return of capital of
$0.70 per share.

CenterMark Management Company, an entity wholly owned by WHL, entered into
an agreement with WEA to manage the properties in WEA's portfolio beginning
January 1, 1995. Property management fees totaling $3,495 and $1,828, net of
capitalized leasing fees of $1,667 and $1,219 were expensed by WEA

F-29
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

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

12. RELATED PARTIES: (CONTINUED)
for the years ended December 31, 1996 and 1995 respectively. Included in
accounts payable and accrued expenses at December 31, 1996 and 1995, are
management fees payable to CMC totaling $711 and $0, respectively.

In addition to the management fees, CMC is reimbursed for corporate overhead
and mall related payroll costs. Reimbursements to CMC of recoverable property
operating costs for the years ended December 31, 1996 and 1995 totaled $8,409
and $6,598, respectively.

The Company entered into a Master Development Framework Agreement with WCI,
a wholly owned subsidiary of WHL, whereby the Company granted WCI the exclusive
right to carry out expansion, redevelopment and related works on WEA wholly
owned shopping centers and to endeavor to have WCI be appointed by the relevant
partner to carry out similar activities for jointly owned real estate
partnerships. During 1996 and 1995, the Company reimbursed WCI $21,535 and
$4,373, respectively, for expansion, redevelopment and related work.

In conjunction with the Recapitalization on July 1, 1996, the Company
engaged Westfield U.S. Advisory L.P. ("Advisor"), a wholly owned subsidiary of
WHL, to provide information, advise and assist the Company and undertake certain
duties and responsibilities on behalf of, and subject to, supervision of the
Company. The advisor is entitled to an annual fee of .55% of the net fair market
value of the Company. No fee is payable for the period through December 31,
1997. The service fee that would have been paid for the six months ended
December 31, 1996, if applicable, was approximately $2.6 million.

In conjunction with the Recapitalization on July 1, 1996, the Company
obtained an option to acquire all of the outstanding common stock of Westland
Realty, Inc. ("WRI"). WRI, a wholly owned subsidiary of WHL, holds a 50%
indirect general partnership interest in Westland Garden State Plaza L.P., an
owner and operator of a super-regional shopping center located in Paramus, New
Jersey. The terms of the option allow WEA to purchase the WRI stock at a price
equal to 50% of the market value of Garden State Plaza net of any mortgage debt
provided that the Company exercises its option within 120 days of the valuation
date. The valuation will be performed upon completion of the expansion of Garden
State Plaza and stabilization of its rents.

13. FINANCIAL INSTRUMENTS:

The following disclosure of the estimated fair value of financial
instruments is made in accordance with the requirements of Statements of
Financial Accounting Standards No. 107, DISCLOSURES ABOUT FAIR VALUE OF
FINANCIAL INSTRUMENTS. The estimated fair value amounts have been determined by
the Company, using available market information and appropriate valuation
methodologies. However, considerable judgment is necessarily required in
interpreting market data to develop the estimates of fair value. Accordingly,
the estimates presented herein are not necessarily indicative of the amounts
that the Company could realize in a current market exchange. The use of
different market assumptions and/or estimation methodologies may have a material
effect on the estimated fair value amounts.

The fair value estimates presented herein are based on pertinent information
available to management as of December 31, 1996. Although management is not
aware of any factors that would significantly affect the estimated fair value
amounts, such amounts have not been comprehensively revalued for

F-30
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

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

13. FINANCIAL INSTRUMENTS: (CONTINUED)
purpose of these consolidated financial statements since that date, and current
estimates of fair value may differ significantly from the amounts presented
herein.

<TABLE>
<CAPTION>
DECEMBER 31, 1996
---------------------
CARRYING ESTIMATED
AMOUNT FAIR VALUE
--------- ----------
<S> <C> <C>
Assets:
Direct financing leases receivable....................................................... $ 92,351 $ 80,689
Accounts and notes receivable............................................................ 19,716 18,180
Liabilities:
Notes payable............................................................................ 770,625 718,914
Accounts payable and accrued expenses.................................................... 33,380 33,380
Off-balance sheet financial instruments--
Letters of credit........................................................................ 3,337 3,337
</TABLE>

RESTRICTED CASH, ACCOUNTS AND NOTES RECEIVABLE, AND ACCOUNTS PAYABLE AND ACCRUED
EXPENSES:

The carrying amounts of these items are a reasonable estimate of their fair
value, except for certain notes receivable which are discounted at current rates
for similar terms.

DIRECT FINANCING LEASES RECEIVABLE:

The fair value of these lease receivables are based upon the discounted
future cash flows at current market rates for leases with similar terms.

NOTES PAYABLE:

The fair value of notes payable are based upon current market rates for
loans with similar terms.

LETTERS OF CREDIT:

The fair value of letters of credit is based on fees currently charged for
similar agreements or on the estimated cost to terminate them or otherwise
settle the obligations with the counterparts at the reporting date.

14. COMMITMENTS AND CONTINGENCIES:

COMMITMENTS:

The Company is currently involved in several development projects and had
outstanding commitments with contractors totaling approximately $35,829 at
December 31, 1996.

The Redevelopment Agency of the City of West Covina (the "Agency") issued
$45,000 of special tax assessment municipal bonds ("Original Bonds") on March 1,
1990, to finance land acquisition for expansion of the shopping center and
additional site improvements. During 1996, the agency refinanced the Original
Bonds by issuing certain serial and term bonds with a total face amount of
$51,220 ("New Bonds"), proceeds of which were used to redeem the Original Bonds.
Special taxes levied against the

F-31
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(IN THOUSANDS)

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

14. COMMITMENTS AND CONTINGENCIES: (CONTINUED)
property, together with incremental property tax, incremental sales tax, and
park and ride revenues will be used to pay the principal and interest on the
bonds and the administrative expense of the Agency. Principal and interest
payments began in 1996 and continue to 2022 in graduating amounts ranging from
$2,030 to $5,289. WEA has the contingent obligation to satisfy any shortfall in
annual debt service requirements after tenant recoveries.

The Company is subject to the risks inherent in the ownership and operation
of commercial real estate. These include, among others, the risks normally
associated with changes in the general economic climate, trends in the retail
industry, including creditworthiness of tenants, competition for tenants,
changes in tax laws, interest rate levels, the availability of financing, and
potential liability under environmental and other laws.

Substantially all of the properties have been subjected to Phase I
environmental reviews. Such reviews have not revealed, nor is management aware
of, any probable or reasonably possible environmental costs that management
believes would be material to the consolidated financial statements.

LITIGATION:

During early 1994, the Company reached an agreement to settle certain
litigation for $950. WEA currently is neither subject to any other material
litigation nor, to management's knowledge, is any material litigation currently
threatened against WEA other than routine litigation and administrative
proceedings arising in the ordinary course of business. Based on consultation
with counsel, management believes that these items will not have a material
adverse impact on the Company's consolidated financial position or results of
operations.

15. SUBSEQUENT EVENTS:

The Company paid a distribution of $22,440 to its shareholders on January
30, 1997.

On January 2, 1997, the Company sold 8,151 common shares to WAT. The Company
used proceeds totaling $130,500 to purchase the remaining common stock held by
GGP Limited Partnership.

F-32
<PAGE>
SCHEDULE III

WESTFIELD AMERICA, INC.
REAL ESTATE INVESTMENT AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
BUILDINGS & ACCUMULATED
PROPERTY LAND IMPROVEMENTS TOTAL DEPRECIATION ENCUMBRANCES
- -------------------------------------------------- ---------- ------------- ------------ ------------ -------------
<S> <C> <C> <C> <C> <C>
Eagle Rock........................................ $ 3,624 $ 12,646 $ 16,270 $ 2,446 --
Eastland.......................................... 16,609 3,375 19,984 627 $ 4,885
Enfield........................................... 8,468 21,050 29,518 3,767 --
La Jolla.......................................... 2,558 2,458 5,016 218 --
Mid Rivers........................................ 10,816 47,732 58,548 7,947 53,205
Mission Valley.................................... 1,007 63,237 64,244 23,283 37,976
Montgomery........................................ 32,420 163,740 196,160 24,572 121,515
Plaza Bonita...................................... 22,994 79,732 102,726 13,951 59,030
South County...................................... 13,259 34,832 48,091 6,514 28,735
West County....................................... 6,506 22,632 29,138 4,215 16,750
West Covina....................................... 18,922 82,326 101,248 10,910 60,615
West Park......................................... 2,633 23,583 26,216 4,482 14,150
Westland.......................................... 5,162 13,101 18,263 2,053 --
Trumbull.......................................... 16,405 161,814 178,219 2,235 144,959
South Shore....................................... 29,071 112,111 141,182 1,402 73,350
Connecticut Post.................................. 6,356 130,855 137,211 1,638 73,450
---------- ------------- ------------ ------------ -------------
$ 196,810 $ 975,224 $ 1,172,034 $ 110,260 $ 688,620
---------- ------------- ------------ ------------ -------------
---------- ------------- ------------ ------------ -------------

<CAPTION>
DEPRECIABLE
PROPERTY DATE OF COMPLETION LIFE
- -------------------------------------------------- --------------------- -------------
<S> <C> <C>
Eagle Rock........................................ 1973 3-31.5 yrs
Eastland.......................................... under constr./1957 3-30 yrs.
Enfield........................................... 1987/1971 3-31.5 yrs.
La Jolla.......................................... 1981 15-31.5 yrs.
Mid Rivers........................................ 1996/1987 3-22 yrs.
Mission Valley.................................... 1997/1961 3-50 yrs.
Montgomery........................................ 1991/1962 3-20 yrs.
Plaza Bonita...................................... 1981 3-39 yrs.
South County...................................... 1979/1963 3-39 yrs.
West County....................................... 1985/1969 3-22 yrs.
West Covina....................................... 1993/1975 3-22 yrs.
West Park......................................... 1984/1981 3-50 yrs.
Westland.......................................... 1994/1960 3-50 yrs.
Trumbull.......................................... 1992/1964 3-40 yrs.
South Shore....................................... under constr./1963 3-40 yrs.
Connecticut Post.................................. 1991/1960 3-40 yrs.
</TABLE>

F-33
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

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

To the Board of Directors
of Westfield America, Inc.

We have audited the accompanying combined statements of revenues and certain
expenses of the Acquired Properties (as defined in Note 1) for the years ended
June 30, 1996, 1995 and 1994. The above mentioned combined statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on the above mentioned combined statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the above mentioned combined statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the above mentioned combined
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
above mentioned combined statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

The accompanying combined statement of revenues and certain expenses was
prepared for the purpose of complying with the rules and regulations of the
Securities and Exchange Commission for inclusion in the registration statement
on Form S-11 of Westfield America, Inc. (formerly CenterMark Properties, Inc.).
Material amounts (described in the Notes to the combined statement of revenues
and certain expenses) that would not be comparable to those resulting from the
proposed future operations of the Acquired Properties are excluded, and the
above mentioned combined statements are not intended to be a complete
presentation of the revenues and expenses of the properties.

In our opinion, the above mentioned combined statements referred to above
present fairly, in all material respects, the revenues and certain expenses for
the years ended June 30, 1996, 1995 and 1994 in conformity with generally
accepted accounting principles.

BDO Seidman, LLP

Los Angeles, California
February 7, 1997

F-34
<PAGE>
THE ACQUIRED PROPERTIES

COMBINED STATEMENTS OF REVENUES AND CERTAIN EXPENSES

FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
(IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR YEAR YEAR
ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30,
1996 1995 1994
--------- --------- ---------
<S> <C> <C> <C>
REVENUES:
Minimum rents.................................................................. $ 34,914 $ 34,741 $ 33,258
Tenant recoveries.............................................................. 17,231 16,922 16,128
Percentage Rents............................................................... 1,498 1,717 1,961
--------- --------- ---------
Total revenue................................................................ 53,643 53,380 51,347
--------- --------- ---------
OPERATING EXPENSES
Operating...................................................................... 20,031 20,021 18,551
Management fees................................................................ 1,325 1,337 1,335
--------- --------- ---------
Total operating expenses..................................................... 21,356 21,358 19,886
--------- --------- ---------
OPERATING INCOME $ 32,287 $ 32,022 $ 31,461
--------- --------- ---------
--------- --------- ---------
</TABLE>

F-35
<PAGE>
THE ACQUIRED PROPERTIES

NOTES TO THE COMBINED STATEMENTS OF REVENUES

AND CERTAIN EXPENSES
(IN THOUSANDS)

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

1. ORGANIZATION AND BASIS OF PRESENTATION:

The accompanying combined statements of revenues and certain expenses
include the accounts of regional shopping centers which Westfield America, Inc.
("WEA") acquired from affiliates on July 1, 1996 in conjunction with its
recapitalization. These regional shopping centers ("Acquired Properties") are as
follows:

Connecticut Post Mall--Milford Connecticut

South Shore Mall--Bay Shore, New York

Trumbull Shopping Park--Trumbull, Connecticut

The accounts of the Acquired Properties have been presented on a combined
historical cost basis in the hands of the sellers. No adjustments have been
reflected in the combined financial statements to give effect to the purchase by
WEA of the properties, listed above.

The combined statements of revenue and certain expenses include only the
accounts and activity of the Acquired Properties and do not include other
accounts or operations of the sellers, primarily expenses that are not
comparable to the expenses expected to be incurred by WEA in the proposed future
operations of the Acquired Properties. Expenses exclude interest, income taxes
and depreciation and amortization.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

REVENUE RECOGNITION:

Shopping center space is generally leased to specialty retail tenants under
leases which are accounted for as operating leases. Minimum rent revenues are
recognized on an accrual basis over the respective lease term, which
approximates the straight-line basis. Percentage rents are recognized on an
accrual basis as earned. Recoveries from tenants, which include an
administrative fee, are recognized as income in the period the applicable costs
are accrued.

BAD DEBTS:

The sellers periodically evaluated amounts billed to tenants and accrued
recoveries from tenants and adjusted the allowance for doubtful accounts to
reflect the amounts estimated to be uncollectible. Amounts determined to be
uncollectible are included in operating expenses.

LEASE TERMINATIONS:

Lump sum payments received from tenants to terminate their lease are
deferred and amortized as minimum rental revenue over the remaining life of the
lease unless the space is re-leased to a new tenant, at which time the remaining
deferred income is recognized.

USE OF ESTIMATES:

The preparation of the combined statements of revenue and certain expenses
in conformity with generally accepted accounting principles requires management
to make estimates and assumptions that effect the reported amounts of revenue
and certain expenses during the reporting periods. Actual results could differ
from those estimates.

F-36
<PAGE>
THE ACQUIRED PROPERTIES

NOTES TO THE COMBINED STATEMENTS OF REVENUES (CONTINUED)

AND CERTAIN EXPENSES
(IN THOUSANDS)

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

3. PROPERTY RENTALS:

Future minimum rental revenues under non cancelable leases as of June 30,
1996 are as follows:

<TABLE>
<S> <C>
1997...................................................... $ 29,805
1998...................................................... 28,662
1999...................................................... 27,609
2000...................................................... 26,794
2001...................................................... 24,717
Thereafter................................................ 103,576
---------
$ 241,163
---------
---------
</TABLE>

These amounts do not include percentage rentals that may be received under
certain leases on the basis of tenant sales in excess of stipulated minimums.

4. TRANSACTIONS WITH RELATED PARTIES:

CenterMark Management Company ("CMC"), an affiliate, provides management,
leasing and development services for the Acquired Properties. CMC received a
management fee of 5% of gross receipts (as defined) for the years ended June 30,
1996, 1995 and 1994. CMC is wholly-owned by Westfield Corporation, Inc. ("WCI")
and its subsidiaries. WCI currently has a 3.85% direct ownership interest in the
Company. WCI is a wholly-owned subsidiary of a company who has a direct and
indirect ownership interest in the Company.

F-37
<PAGE>
REPORT OF INDEPENDENT AUDITORS

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

To the Board of Directors
of Westfield America, Inc.

We have audited the accompanying statement of revenues and certain expenses
of Annapolis Mall for the year ended December 31, 1996. The above mentioned
statement is the responsibility of the Company's management. Our responsibility
is to express an opinion on the above mentioned statement based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the above mentioned statement is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the above mentioned statement. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall above mentioned
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

The accompanying statement of revenues and certain expenses was prepared for
the purpose of complying with the rules and regulations of the Securities and
Exchange Commission for inclusion in the registration statement on Form S-11 of
Westfield America, Inc. (formerly CenterMark Properties, Inc.). As described in
the Note 1 to the statement of revenues and certain expenses, certain expenses
that would not be comparable to those resulting from the proposed future
operations of Annapolis Mall are excluded, and the above mentioned statement is
not intended to be a complete presentation of the revenues and expenses of the
property.

In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and certain expenses for the year ended December
31, 1996 in conformity with generally accepted accounting principles.

Ernst & Young, LLP

Los Angeles, California
January 30, 1997

F-38
<PAGE>
ANNAPOLIS MALL

STATEMENT OF REVENUES AND CERTAIN EXPENSES

(IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR
ENDED
DECEMBER 31,
1996
------------
<S> <C>
REVENUES:
Minimum rents..................................................................................... $ 14,216
Tenant recoveries................................................................................. 5,219
Percentage rents.................................................................................. 171
------------
Total revenues.................................................................................. 19,606
------------

OPERATING EXPENSES
Operating--recoverable............................................................................ 4,414
Other operating................................................................................... 274
------------
Total operating expenses........................................................................ 4,688
------------
Excess of revenue over certain operating expenses................................................... $ 14,918
------------
------------
Interest in excess of revenue over certain operating expenses being acquired........................ $ 10,443
------------
------------
</TABLE>

See accompanying notes

F-39
<PAGE>
ANNAPOLIS MALL

NOTES TO THE STATEMENT OF REVENUES

AND CERTAIN EXPENSES

(IN THOUSANDS)
-------------------

1. ORGANIZATION AND BASIS OF PRESENTATION:

The accompanying statement of revenues and certain expenses includes the
accounts of a regional shopping center which is owned by Annapolis Mall Limited
Partnership (the "Partnership"). The Partnership consists of CenterMark
Properties of Annapolis, Inc. ("CMPA"), a 30% general partner, and RREEF USA
Fund-III/Annapolis, Inc. ("RREEF"), which is both a 50% general and a 20%
limited partner. CMPA is a wholly-owned subsidiary of Westfield America, Inc.
(WEA), formerly CenterMark Properties, Inc.

In the proposed transaction WEA is proposing to acquire a 70% interest in
Annapolis Mall.

Interest income, depreciation expense and management fee expense (see Note
4) are not comparable to the proposed operations of Annapolis Mall and have been
excluded from the accompanying statement of revenues and certain expenses.

Income taxes are not reflected in the statement of revenues and certain
expenses as Annapolis Mall is currently owned by the Partnership and income of
the Partnership is included in the partners' respective tax returns.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

REVENUE RECOGNITION:

Shopping center space is generally leased to specialty retail tenants under
leases which are accounted for as operating leases. Minimum rent revenues are
recognized on a straight-line basis over the respective lease term. Percentage
rents are recognized on an accrual basis as earned. Recoveries from tenants,
which include an administrative fee, are recognized as income in the period the
applicable costs are accrued.

BAD DEBTS:

Management periodically evaluates amounts billed to tenants and accrued
recoveries from tenants and adjusts the allowance for doubtful accounts to
reflect the amounts estimated to be uncollectible. Amounts determined to be
uncollectible are included in other operating expenses.

LEASE TERMINATIONS:

USE OF ESTIMATES:

The preparation of the statement of revenues and certain expenses in
accordance with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of revenue and
certain expenses during the reporting periods. Actual results could differ from
those estimates.

F-40
<PAGE>
3. PROPERTY RENTALS:

Future Minimum rental revenues under noncancelable operating leases as of
December 31, 1996 are as follows:

<TABLE>
<S> <C>
1997................................. $ 13,119
1998................................. 13,413
1999................................. 13,329
2000................................. 12,894
2001................................. 11,986
Thereafter........................... 44,321
--------
$ 109,062
--------
--------
</TABLE>

These amounts do not include percentage rentals that may be received under
certain leases on the basis of tenant sales in excess of stipulated minimums.

4. TRANSACTIONS WITH RELATED PARTIES:

During 1996 the property was managed by an affiliate WEA. The management fee
is not reflected in the accompanying statement of revenue and certain expenses
since it is not comparable to the proposed operations of Annapolis Mall. In
addition, the affiliate is reimbursed for mall related overhead and payroll
costs recoverable from tenants in accordance with their leases. Reimbursements
of recoverable overhead and payroll costs for the year ended December 31, 1996
totaled $1,073.

F-41
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

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

To the Board of Directors
of Westfield America, Inc.

We have audited the accompanying statements of revenues and certain expenses
of Westland Garden State Plaza Limited Partnership (the "Partnership") for the
years ended December 31, 1996, 1995 and 1994. The above mentioned statements are
the responsibility of the Partnership's management. Our responsibility is to
express an opinion on the above mentioned statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the above mentioned statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the above mentioned statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall above mentioned
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

The accompanying statements of revenues and certain expenses were prepared
for the purpose of complying with the rules and regulations of the Securities
and Exchange Commission for inclusion in the registration statement on Form S-11
of Westfield America, Inc. (formerly CenterMark Properties, Inc.). Material
amounts (described in the Notes to the Statements of Revenues and Certain
Expenses) that would not be comparable to those resulting from the proposed
future operations of Garden State Plaza are excluded, and the above mentioned
statements are not intended to be a complete presentation of the revenues and
expenses of Garden State Plaza.

In our opinion, the statements referred to above present fairly, in all
material respects, the revenues and certain expenses of Westland Garden State
Plaza Limited Partnership for the years ended December 31, 1996, 1995 and 1994
in conformity with generally accepted accounting principles.

BDO SEIDMAN, LLP

Los Angeles, California
February 5, 1997

F-42
<PAGE>
WESTLAND GARDEN STATE PLAZA LIMITED PARTNERSHIP
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

(IN THOUSANDS)

<TABLE>
<CAPTION>
1996 1995 1994
---------- ---------- ----------
<S> <C> <C> <C>
REVENUES:
Minimum rents............................................................... $ 32,829 $ 28,238 $ 26,228
Tenant recoveries........................................................... 13,112 12,073 11,839
Percentage rents............................................................ 799 1,705 2,625
---------- ---------- ----------
Total revenue............................................................. 46,740 42,016 40,692
---------- ---------- ----------
EXPENSES:
Operating recoverable....................................................... 11,688 11,069 10,974
Other operating............................................................. 804 910 230
Management fees............................................................. 1,388 1,132 1,102
---------- ---------- ----------
Total expenses............................................................ 13,880 13,111 12,306
---------- ---------- ----------
OPERATING INCOME.............................................................. 32,860 28,905 28,386

INTEREST EXPENSE, net......................................................... (11,279) (15,815) (18,323)

INTEREST INCOME............................................................... 127 75 43
---------- ---------- ----------
NET REVENUES AND CERTAIN EXPENSES............................................. $ 21,708 $ 13,165 $ 10,106
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

F-43
<PAGE>
WESTLAND GARDEN STATE PLAZA LIMITED PARTNERSHIP

NOTES TO THE STATEMENTS OF REVENUES AND CERTAIN EXPENSES
(IN THOUSANDS)

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

1. ORGANIZATION:

Westland Garden State Plaza Limited Partnership, a Delaware limited
partnership (the "Partnership"), was formed to acquire, hold for investment and
operate Garden State Plaza, a super regional shopping center located in Paramus,
New Jersey. For the years ended December 31, 1996, 1995 and 1994, the general
partners are HRE Garden State Plaza, Inc. (50%) and Westland Management, Inc.
("WMI") (1%) and the limited partner is Westfield Partners, Inc. ("WPI") (49%).
WMI and WPI are indirectly wholly owned by Westfield Holdings Limited ("WHL").
Profits and losses are allocated in accordance with the partners' respective
interests.

Westfield America, Inc., an affiliate of WMI, WPI and WHL, will acquire a
substantial economic interest in the revenues of Garden State Plaza by using a
portion of the proceeds from its initial public offering to make a $145 million
participating secured loan to WMI and WPI.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

REVENUE RECOGNITION:

Shopping center space is generally leased to specialty retail tenants under
leases which are accounted for as operating leases. Minimum rent revenues are
recognized on an accrual basis over the respective lease term, which
approximates the straight-line basis. Percentage rents are recognized on an
accrual basis as earned. Recoveries from tenants are recognized as income in the
period the applicable costs are accrued.

BAD DEBTS:

DEFERRED EXPENSES:

Procurement costs associated with the note payable are amortized on a
straight-line basis, which approximates the effective interest rate method, over
the term of the note payable. Direct costs related to leasing activities are
capitalized and amortized over the initial term of the new lease.

LEASE TERMINATIONS:

INCOME TAXES:

Income of the Partnership is included in the partners' respective tax
returns; therefore, no provision is made in the accompanying statements of
income for federal and state income taxes.

F-44
<PAGE>
WESTLAND GARDEN STATE PLAZA LIMITED PARTNERSHIP

NOTES TO THE STATEMENTS OF REVENUES AND CERTAIN EXPENSES
(IN THOUSANDS) (CONTINUED)

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

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (CONTINUED)
USE OF ESTIMATES:

The preparation of the statements of income in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that effect the reported amounts of revenue and expenses during the
reporting periods. Actual results could differ from those estimates.

3. PROPERTY RENTALS:

Future minimum rental revenues under noncancelable leases as of December 31,
1996 are as follows:

<TABLE>
<S> <C>
1997.............................................................. $ 39,994
1998.............................................................. 39,447
1999.............................................................. 37,093
2000.............................................................. 36,444
2001.............................................................. 35,481
Thereafter........................................................ 253,046
---------
$ 441,505
---------
---------
</TABLE>

These amounts do not include percentage rentals that may be received under
certain leases on the basis of tenant sales in excess of stipulated minimums.

During the years ended December 31, 1996, 1995 and 1994, one tenant,
Federated Department Stores operating as Macy's, represented approximately 15%
of rental revenues.

4. INTEREST EXPENSE:

The Partnership incurs interest at 8.23% on a collateralized note payable to
an insurance company totaling $260,020. Interest only payments are due monthly
with the principal balance due in May 2005.

During the years ended December 31, 1996, 1995 and 1994, the Partnership
capitalized interest totaling $10,468, $7,404 and $4,739, respectively.

5. TRANSACTIONS WITH RELATED PARTIES:

On July 1, 1993 the Partnership entered into a management agreement with
Westfield Corporation, Inc. ("WCI"), a wholly owned subsidiary of WHL. The
agreement provides that the Partnership pay a fee of four percent on minimum
rents and percentage rents and reimburse WCI for payroll and related fringe
benefit costs incurred on its behalf. Employee related expenses are reflected as
recoverable expenses in the accompanying statements of income.

F-45
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN
CONNECTION WITH THE OFFERING COVERED BY THIS PROSPECTUS. IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR THE UNDERWRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER
TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, THE SHARES IN ANY JURISDICTION
WHERE, OR TO ANY PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS, NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS
BEEN ANY CHANGE IN THE FACTS SET FORTH IN THIS PROSPECTUS OR IN THE AFFAIRS OF
THE COMPANY SINCE THE DATE HEREOF.

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

SUMMARY
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Prospectus Summary............................. 1
Risk Factors................................... 21
The Company.................................... 37
Use of Proceeds................................ 47
Capitalization................................. 48
Dilution....................................... 49
Distributions.................................. 50
Selected Financial Data........................ 51
Management's Discussion and Analysis of
Financial Condition and Results of
Operations.................................... 54
Business and Properties........................ 65
Policies and Objectives with Respect to
Investments, Financing and Other Activities... 99
Management..................................... 104
Advisory, Management and Development Services
to the Company................................ 109
Certain Transactions........................... 112
Principal Shareholders......................... 117
Description of Capital Stock................... 120
Certain Provisions of the Company's Articles of
Incorporation and By-Laws and of Missouri
Law........................................... 124
Shares Available for Future Sale............... 129
Federal Income Tax Considerations.............. 131
ERISA Considerations........................... 143
Underwriting................................... 144
Experts........................................ 148
Legal Matters.................................. 148
Additional Information......................... 148
Glossary....................................... G-1
Index to Financial Statements.................. F-1
</TABLE>

UNTIL JUNE 9, 1997 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL DEALERS
EFFECTING TRANSACTIONS IN THE SHARES OFFERED HEREBY, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER
A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.

18,000,000 SHARES

rstuw

COMMON STOCK

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

PROSPECTUS

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

MERRILL LYNCH & CO.

FURMAN SELZ

GOLDMAN, SACHS & CO.

MORGANSTANLEY & CO.
INCORPORATED

PRUDENTIAL SECURITIES INCORPORATED

SMITH BARNEY INC.

MAY 15, 1997

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
Filed pursuant to Rule 424(b)(1)
Registration No. 333-22731

PROSPECTUS
18,000,000 SHARES
[LOGO]
WESTFIELD AMERICA, INC.

COMMON STOCK
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Westfield America, Inc. (formerly known as CenterMark Properties, Inc.) (the
"Company") is a Missouri corporation incorporated in 1924 and is engaged in
owning, operating, leasing, developing, redeveloping and acquiring super
regional and regional shopping centers and power centers located primarily in
major metropolitan areas in the United States. The Company's portfolio consists
of interests in 13 super regional and six regional shopping centers and three
power centers containing approximately 19.2 million square feet of gross
leasable area (together, the "Centers") and 13 separate department store
properties. The Company has engaged subsidiaries of Westfield Holdings Limited
(individually, "Westfield Holdings Limited" and collectively with its
subsidiaries, "Westfield Holdings"), an Australian public corporation and a
principal shareholder in the Company, to provide advisory, management and
development services to the Company and the Centers. The Company will use $145
million of the proceeds of the Offerings (as defined below) to make a
non-recourse loan secured by Westfield Holdings's indirect 50% interest in
Garden State Plaza, a super-regional shopping center, and $15.3 million to
purchase from Westfield Holdings Limited warrants (the "Westfield Holdings
Warrants") to acquire 9.8 million ordinary shares of Westfield Holdings Limited.
Westfield Holdings Limited is an independent company from the Company and,
except for the Company's interest in the Westfield Holdings Warrants, the
purchasers of the Shares will not acquire any interest in Westfield Holdings
Limited. The Company is organized and operated as a real estate investment trust
("REIT") and expects to continue to be operated as a REIT for Federal income tax
purposes. The Company intends to continue to pay regular quarterly
distributions.

All of the shares (the "Shares") of common stock, par value $.01 per share
(the "Common Stock"), of the Company offered hereby are being sold by the
Company. Of the 18,000,000 Shares being offered, 2,700,000 Shares are being
offered initially outside the United States and Canada by the International
Managers (the "International Offering") and the remaining 15,300,000 Shares are
being offered initially in a concurrent offering in the United States and Canada
by the U.S. Underwriters (the "U.S. Offering" and, together with the
International Offering, the "Offerings"). Westfield Holdings, interests
associated with the Lowy family and a Co-President of the Company have placed
orders to purchase up to 2,300,000, 600,000 and 100,000 shares respectively (the
"Orders"), at the price to public in the Offerings. The Common Stock has been
approved for listing on the New York Stock Exchange, subject to official notice
of issuance, under the symbol "WEA". Prior to the Offerings, there has been no
public market for the Common Stock. See "Underwriting" for a discussion of the
factors considered in determining the initial public offering price. The
Company's articles of incorporation impose limitations, subject to certain
limited exceptions, on the number of shares of capital stock that may be
directly or indirectly owned by any person or affiliated group. See "Description
of Capital Stock--Restrictions on Ownership and Transfer."

Upon consummation of the Offerings and concurrent transactions and taking
account of the maximum number of Shares which may be acquired under the Orders,
Westfield America Trust, an Australian public property trust ("WAT") will own
62.4% and Westfield Holdings will own 16.7% (31.7% including its indirect
interest through WAT) of the outstanding Common Stock on a fully-diluted basis.
The Shares offered hereby represent approximately 22.7% of all shares of Common
Stock (including up to 3.8% which may be acquired under the Orders) that will be
issued and outstanding after the Offerings and concurrent transactions on a
fully-diluted basis.

SEE "RISK FACTORS" BEGINNING ON PAGE 21 FOR CERTAIN FACTORS RELEVANT TO AN
INVESTMENT IN THE COMMON STOCK, INCLUDING:

- POSSIBLE CONFLICTS OF INTEREST AMONG WESTFIELD HOLDINGS, THE LOWY FAMILY,
WAT AND THE OTHER SHAREHOLDERS OF THE COMPANY.

- RELIANCE BY THE COMPANY ON WESTFIELD HOLDINGS FOR ADVISORY, MANAGEMENT AND
DEVELOPMENT SERVICES SUCH THAT THE COMPANY IS NOT CURRENTLY ABLE TO
OPERATE WITHOUT WESTFIELD HOLDINGS.

- THE ABILITY OF WESTFIELD HOLDINGS, THE LOWY FAMILY AND WAT TO EXERCISE
SIGNIFICANT INFLUENCE OVER THE BUSINESS AND POLICIES OF THE COMPANY.

- LIMITATIONS ON THE SHAREHOLDERS' ABILITY TO CHANGE CONTROL OF THE COMPANY
DUE TO SIGNIFICANT OWNERSHIP BY WESTFIELD HOLDINGS AND WAT AND DUE TO
RESTRICTIONS ON OWNERSHIP OF MORE THAN 5.5% OF THE SHARES OF CAPITAL STOCK
BY OTHER SHAREHOLDERS.

- RISKS GENERALLY INHERENT IN RETAIL REAL ESTATE INVESTMENTS, SUCH AS RISKS
FROM CHANGES IN ECONOMIC CONDITIONS, REDEVELOPMENT RISK, COMPETITION FROM
OTHER SHOPPING CENTERS AND OTHER FORMS OF RETAILING AND FINANCIAL
DIFFICULTIES OR BANKRUPTCIES OF TENANTS OR ANCHORS.

- RISKS NORMALLY ASSOCIATED WITH DEBT FINANCING, INCLUDING POSSIBLE
INABILITY TO REFINANCE BALLOON PAYMENTS AND THE RISK OF HIGHER INTEREST
RATES.

- TAXATION OF THE COMPANY AS A REGULAR CORPORATION AND RESULTING ADVERSE
CONSEQUENCES IF IT FAILS TO CONTINUE TO QUALIFY AS A REIT.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

(1) The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."

(2) The U.S. Underwriters and International Managers will only receive the
selling concession portion of the underwriting discount ($.58 per Share) on
the Orders.

(3) Before deducting estimated expenses of $7,750,000 payable by the Company.

(4) The Company has granted to the U.S. Underwriters and the International
Managers options, exercisable for a period of 30 days after the date of the
Prospectus, to purchase up to an aggregate of 2,295,000 and 405,000
additional shares of Common Stock, respectively, solely to cover
over-allotments. If all such shares of Common Stock are purchased, the total
Price to Public, Underwriting Discount and Proceeds to Company will be
$310,500,000, $20,325,000 and $290,175,000, respectively. See
"Underwriting."
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The Shares are offered by the several Underwriters, subject to prior sale,
when, as and if delivered to and accepted by the Underwriters, and subject to
their right to withdraw, modify, cancel and reject orders in whole or in part.
It is expected that delivery of the Shares offered hereby will be made in New
York City on or about May 21, 1997.
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MERRILL LYNCH INTERNATIONAL
FURMAN SELZ
GOLDMAN SACHS INTERNATIONAL
MORGAN STANLEY & CO. INTERNATIONAL
PRUDENTIAL-BACHE SECURITIES
SMITH BARNEY INC.
BANKERS TRUST INTERNATIONAL PLC
ABN AMRO ROTHSCHILD
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The date of this Prospectus is May 15, 1997.
<PAGE>
Map showing the locations of Westfield America, Inc.'s shopping centers
throughout the United States and identifying the redevelopment projects over a
five-year period; photograph of Montgomery Mall; aerial photographs of Annapolis
Mall, Topanga Plaza, Trumbull Shopping Park, West County Center, Meriden Square,
Mission Valley Center, Plaza Bonita, Mid Rivers Mall, The Plaza at West Covina;
interior photographs of Montgomery Mall, Plaza Camino Real, Plaza Bonita,
Annapolis Mall and Connecticut Post Mall.

THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
IS UNLAWFUL. THERE ARE RESTRICTIONS ON THE OFFER AND SALE OF SECURITIES IN THE
UNITED KINGDOM. ALL APPLICABLE PROVISIONS OF THE FINANCIAL SERVICES ACT 1986 AND
THE PUBLIC OFFERS OF SECURITIES REGULATIONS 1995 WITH RESPECT TO ANYTHING DONE
BY ANY PERSON IN RELATION TO ANY SECURITIES IN, FROM OR OTHERWISE INVOLVING THE
UNITED KINGDOM MUST BE COMPLIED WITH. SEE "UNDERWRITING."